[PIONEER LOGO]
Pioneer Bond
Fund
ANNUAL REPORT 6/30/98
<PAGE>
Table of Contents
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Letter from the Chairman 1
Portfolio Summary 2
Performance Update 3
Portfolio Management Discussion 6
Schedule of Investments 9
Financial Statements 16
Notes to Financial Statements 22
Report of Independent Public Accountants 26
Trustees, Officers and Service Providers 27
The Pioneer Family of Mutual Funds 28
Retirement Plans from Pioneer 29
</TABLE>
<PAGE>
Pioneer Bond Fund
LETTER FROM THE CHAIRMAN 6/30/98
Dear Shareowner,
- --------------------------------------------------------------------------------
Fixed-income markets, in particular U.S. Treasury bonds, produced strong
results over the past year as the powerful combination of low interest rates
and low inflation pushed bond prices higher.
Holders of a diverse combination of bonds, like those owned by Pioneer Bond
Fund, enjoyed the best of both worlds - high yields with stable or rising
prices. As conditions changed throughout the period, your Fund's portfolio
management team adjusted both the portfolio's duration and diversification to
manage risk and produce solid returns.
Predicting the short-term direction of financial markets is almost always a
futile exercise, as the events of the last year reminded many investors. While
stock and bond markets generated solid gains, concerns about the Asian economic
crisis and its effect on corporate earnings prompted periods of volatility.
What can you as an investor do? I encourage you to periodically review your
financial goals and strategy with your investment professional. It's a simple
step to make sure you will be better prepared to weather the inevitable swings
in the market.
Please read on to learn more about how your Fund is being managed. If you have
questions about Pioneer Bond Fund, please contact your investment professional,
or Pioneer at 1-800-225-6292.
Respectfully,
/S/ John F. Cogan, Jr.
John F. Cogan, Jr.,
Chairman and President
1
<PAGE>
Pioneer Bond Fund
PORTFOLIO SUMMARY 6/30/98
P o r t f o l i o D i v e r s i f i c a t i o n
- --------------------------------------------------------------------------------
(As a percentage of total investment portfolio)
[pie chart]
Corporate Securities 59%
U.S. Government and Agency Securities 40%
Short-Term Cash Equivalents 1%
P o r t f o l i o M a t u r i t y
- --------------------------------------------------------------------------------
(Effective life as a percentage of total investment portfolio)
[pie chart]
0-2 Years 14%
2-5 Years 24%
5-7 Years 20%
7-10 Years 12%
10-20 Years 14%
20+ Years 16%
1 0 L a r g e s t H o l d i n g s
- --------------------------------------------------------------------------------
(As a percentage of long-term holdings)
<TABLE>
<S> <C>
1. U.S. Treasury Notes, 7.25%, 5/15/04 6.51%
2. U.S. Treasury Notes, 7.0%, 7/15/06 4.37
3. U.S. Treasury Notes, 6.375%, 8/15/27 3.30
4. Government National Mortgage Association, 7.5%, 6/15/27 3.03
5. U.S. Treasury Notes, 8.5%, 2/15/00 2.79
6. Government National Mortgage Association, 7.5%, 5/15/27 2.71
7. Ford Capital BV, 9.5%, 6/1/10 2.53
8. U.S. Treasury Notes, 8.0%, 5/15/01 2.48
9. U.S. Treasury Notes, 6.375%, 3/31/01 2.04
10. Delta Air Lines, Inc., 9.2%, 9/23/14 2.04
</TABLE>
Fund holdings will vary for other periods.
2
<PAGE>
Pioneer Bond Fund
PERFORMANCE UPDATE 6/30/98 CLASS A SHARES
S h a r e P r i c e s a n d D is t r i b u t i o n s
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C>
Net Asset Value
per Share 6/30/98 6/30/97
$ 9.37 $ 9.07
Distributions per Share Income Short-Term Long-Term
(6/30/97 - 6/30/98) Dividends Capital Gains Capital Gains
$ 0.589 - -
</TABLE>
I n v e s t m e n t R e t u r n s
- --------------------------------------------------------------------------------
The mountain chart on the right shows the growth of a $10,000 investment made
in Pioneer Bond Fund at public offering price, compared to the growth of the
Lehman Brothers Government/Corporate Bond Index.
<TABLE>
<CAPTION>
Average Annual Total Returns
(As of June 30, 1998)
Net Asset Public Offering
Period Value Price*
<S> <C> <C>
10 Years 8.37% 7.87%
5 Years 6.18 5.21
1 Year 10.04 5.06
</TABLE>
* Reflects deduction of the maximum 4.5% sales charge at the beginning of the
period and assumes reinvestment of distributions at net asset value.
[mountain chart]
Growth of $10,000
Lehman Brothers Government/
Pioneer Bond Fund* Corporate Bond Index
6/88 9550 10000
10612 11234
6/90 11273 12032
12415 13262
6/92 14033 15141
15810 17132
6/94 15612 16881
17405 19036
6/96 18104 19927
19387 21471
6/98 21334 23894
The Lehman Brothers Government/Corporate Bond Index is an unmanaged, composite
index of the U.S. bond market. It contains 5,353 issues, including Treasury and
government agency securities, investment-grade corporate bonds and Yankee bonds.
Index returns are calculated monthly, assume reinvestment of dividends and,
unlike Fund returns, do not reflect any fees, expenses or sales charges. You
cannot invest directly in the Index.
Past performance does not guarantee future results. Return and share price
fluctuate, and your shares, when redeemed, may be worth more or less than their
original cost.
3
<PAGE>
Pioneer Bond Fund
PERFORMANCE UPDATE 6/30/98 CLASS B SHARES
S h a r e P r i c e s a n d D i s t r i b u t i o n s
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C>
Net Asset Value
per Share 6/30/98 6/30/97
$ 9.33 $ 9.03
Distributions per Share Income Short-Term Long-Term
(6/30/97 - 6/30/98) Dividends Capital Gains Capital Gains
$ 0.515 - -
</TABLE>
I n v e s t m e n t R e t u r n s
- --------------------------------------------------------------------------------
The mountain chart on the right shows the growth of a $10,000 investment made
in Pioneer Bond Fund, compared to the growth of the Lehman Brothers
Government/Corporate Bond Index.
<TABLE>
<CAPTION>
Average Annual Total Returns
(As of June 30, 1998)
If If
Period Held Redeemed*
<S> <C> <C>
Life-of-Fund 6.64% 6.26%
(4/4/94)
1 Year 9.21 5.21
</TABLE>
* Reflects deduction of the maximum applicable contingent deferred sales charge
(CDSC) at the end of the period and assumes reinvestment of distributions. The
maximum CDSC of 4% declines over six years.
[mountain chart]
Growth of $10,000+
Lehman Brothers Government/
Pioneer Bond Fund* Corporate Bond Index
4/94 10000 10000
6/94 9896 9958
9914 10007
9906 10044
10327 10545
6/95 10942 11229
11089 11444
11600 11977
11274 11699
6/96 11286 11754
11439 11962
11729 12328
11614 12221
6/97 11990 12665
12353 13109
12713 13530
12839 13736
6/98 12895 14095
+ Index comparison begins 4/30/94. The Lehman Brothers Government/Corporate Bond
Index is an unmanaged, composite index of the U.S. bond market. It contains
5,353 issues, including Treasury and government agency securities,
investment-grade corporate bonds and Yankee bonds. Index returns are
calculated monthly, assume reinvestment of dividends and, unlike Fund returns,
do not reflect any fees, expenses or sales charges. You cannot invest directly
in the Index.
Past performance does not guarantee future results. Return and share price
fluctuate, and your shares, when redeemed, may be worth more or less than
their original cost.
4
<PAGE>
Pioneer Bond Fund
PERFORMANCE UPDATE 6/30/98 CLASS C SHARES
S h a r e P r i c e s a n d D i s t r i b u t i o n s
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C>
Net Asset Value
per Share 6/30/98 6/30/97
$ 9.31 $ 9.02
Distributions per Share Income Short-Term Long-Term
(6/30/97 - 6/30/98) Dividends Capital Gains Capital Gains
$ 0.516 - -
</TABLE>
I n v e s t m e n t R e t u r n s
- --------------------------------------------------------------------------------
The mountain chart on the right shows the growth of a $10,000 investment made
in Pioneer Bond Fund, compared to the growth of the Lehman Brothers
Government/Corporate Bond Index.
<TABLE>
<CAPTION>
Average Annual Total Returns
(As of June 30, 1998)
If If
Period Held Redeemed*
<S> <C> <C>
Life-of-Fund 4.94% 4.94%
(1/31/96)
1 Year 9.12 9.12
</TABLE>
* Assumes reinvestment of distributions. A 1% contingent deferred sales charge
(CDSC) applies to redemptions made within one year of purchase.
[mountain chart]
Growth of $10,000
Lehman Brothers Government/
Pioneer Bond Fund* Corporate Bond Index
1/96 10000 10000
9679 9708
6/96 9700 9753
9831 9926
10081 10229
9971 10141
6/97 10294 10509
10607 10878
10904 11227
11024 11398
6/98 11233 11696
The Lehman Brothers Government/Corporate Bond Index is an unmanaged, composite
index of the U.S. bond market. It contains 5,353 issues, including Treasury and
government agency securities, investment-grade corporate bonds and Yankee
bonds. Index returns are calculated monthly, assume reinvestment of dividends
and, unlike Fund returns, do not reflect any fees, expenses or sales charges.
You cannot invest directly in the Index.
Past performance does not guarantee future results. Return and share price
fluctuate, and your shares, when redeemed, may be worth more or less than their
original cost.
5
<PAGE>
Pioneer Bond Fund
PORTFOLIO MANAGEMENT DISCUSSION 6/30/98
Pioneer Bond Fund celebrated its 20th fiscal year on June 30, 1998, marking a
two-decade span that presented a broad range of investment environments and
opportunities. In the 1980s, double-digit inflation and record-high interest
rates challenged the most seasoned fixed-income investors. However, the
subsequent 17-year decline in interest rates pushed bond prices significantly
higher, generating impressive total returns. Today, globalization is the key.
While conditions change and challenges remain, quality income-producing
investments still add time-tested value to a well-rounded portfolio.
The following discussion with Sherman B. Russ, your Fund's portfolio manager,
details the investment environment and the strategies that affected your Fund's
performance over the past 12 months. An investment professional for more than
20 years, Mr. Russ oversees the team responsible for the daily management of
Pioneer Bond Fund.
Q: How did Pioneer Bond Fund perform over the past 12 months?
A: The Fund generated an attractive level of income and a competitive total
return. On June 30, the Fund's 30-day SEC yield stood at 4.96%. For the 12
months ended June 30, the Fund's Class A Shares returned 10.04% at net asset
value. In comparison, the average return of the 143 funds in Lipper
Analytical Services' Corporate Debt A-rated category was 10.36%. (Returns do
not reflect sales charges.) We attribute the difference in returns to the
Fund's emphasis on quality. At least 85% of your Fund's assets are in bonds
rated A or better at the time of purchase by major rating agencies. In
contrast, other Funds in the category can invest in lower-quality, high-yield
bonds that, because these securities involve greater risk, often produce
higher returns. The Fund's average quality was "AA" at the end of the fiscal
year. (Ratings apply to underlying securities, not Fund shares.)
Q: What was the investment environment like during this time?
A: Very positive. Strong investor demand pushed bond prices higher and long-term
interest rates lower. The yield on the benchmark 30-year U.S.
6
<PAGE>
Pioneer Bond Fund
Treasury bond fell from 6.78% on June 30, 1997 to 5.63% one year later.
Bond prices rose accordingly.
In the United States, strong domestic labor and housing markets propelled
economic growth, inflation remained low and the dollar strengthened. The
economy's strength generated rising tax receipts, which helped produce the
first federal budget surplus in nearly 30 years. The government's positive
fiscal situation reduced its need to issue debt and a smaller supply tends
to be positive for bond prices.
Q: How did the situation in Asia affect U.S. interest rates and bonds?
A: The uncertainty of the Asian crisis kept interest rates, and bond prices,
within a narrow range for most of the period and sparked a "flight to
quality." Generally, investors waited for new developments and evidence of
the situation's effect on the U.S. economy. When the crisis worsened this
spring, they sought the safety and security of U.S. Treasurys. This demand
again pushed up bond prices and lowered interest rates.
Asia's problems held down U.S. interest rates for another reason, too. Many
investors were concerned that our strong economy eventually might stimulate
inflation and lead the Federal Reserve to raise interest rates. But,
because the United States and Asia are active trading partners, slowing
Asian economies could lessen U.S. economic growth. That would ease
inflationary pressures and reduce the Fed's impetus to change rates. This
possibility gave investors more confidence in government securities.
However, concern about Asia's problems spilling over to U.S. businesses
hurt the prices of many corporate bonds.
Q: What strategies did you use to manage the Fund?
A: We focused on maximizing total return and yield. We actively managed the
allocation to U.S. Treasury and agency, mortgage-backed and corporate
securities, emphasizing relative value. In addition, we adjusted the Fund's
maturity as interest rates moved up and down. Last June 30, portfolio
holdings had an average effective life of 9.2 years, which we decreased to
8.9 years by the end of the Fund's fiscal year. (Effective maturity takes
7
<PAGE>
Pioneer Bond Fund
PORTFOLIO MANAGEMENT DISCUSSION 6/30/98 (continued)
into account the time left until a bond matures or can be called on demand
by the issuer, whichever is sooner.)
During the year, we increased the potential for total return by raising the
position in U.S. Treasurys and reducing holdings in callable agency and
mortgage-backed securities. U.S. Treasurys tend to outperform these other
securities when interest rates decline, because they earn income and
generate total return until their stated maturity or until we decide to
sell them. In contrast, callable bonds can be "called" from the portfolio
on a predetermined date if the issuer chooses to refinance at a lower
interest rate. Similarly, mortgage-holders may refinance existing,
higher-cost mortgages at lower interest rates. As these mortgages are
prepaid, they are eliminated from the portfolio.
We emphasized yield and relative value by increasing A-rated bonds and
maintaining the maximum allowable position (15%) in BBB-rated securities.
Securities rated BBB provided more yield than higher-quality securities and
their prices rose faster than many of their higher-rated counterparts. We
increased the Fund's holdings in A-rated bonds late in the period; we think
these bonds currently provide the most attractive blend of yield and
quality.
Q: What is your outlook for the next six months?
A: We think bonds will benefit from many trends that existed this year. We
expect the domestic economy to remain solid and developments regarding the
federal budget surplus to be positive. We also believe the uncertainty in
Asia will continue to affect the U.S. bond market.
Near term, we think investors will prefer quality and liquidity, which
should particularly benefit U.S. Treasurys and support the U.S. dollar.
Looking out further, we expect Asia to have a powerful influence on
interest rates - if there is a significant spillover into the U.S. economy,
interest rates could remain stable or move moderately lower.
8
<PAGE>
Pioneer Bond Fund
SCHEDULE OF INVESTMENTS 6/30/98
<TABLE>
<CAPTION>
S&P/Moody's
Principal Ratings
Amount (Unaudited) Value
<S> <C> <C> <C>
INVESTMENT IN SECURITIES - 99.3%
Basic Materials - 3.1%
Chemicals - 0.9%
$1,000,000 BBB+/Baa1 Arco Chemical Co., Deb., 9.8%, 2/1/20 $1,299,570
----------
Iron & Steel - 1.5%
2,000,000 BBB-/Baa2 USX Corp., Deb., 8.125%, 7/15/23 $2,245,500
----------
Paper & Forest Products - 0.7%
1,000,000 A-/A3 Mead Corp., Deb., 8.125%, 2/1/23 $1,103,110
----------
Total Basic Materials
(Cost $4,279,950) $4,648,180
----------
Capital Goods - 1.1%
Manufacturing - 1.1%
1,500,000 BBB/Baa1 Tenneco Inc., Deb., 10.075%, 2/1/01 $1,631,640
----------
Total Capital Goods
(Cost $1,597,900) $1,631,640
----------
Consumer Cyclicals - 4.0%
Automobiles - 1.7%
2,000,000 A/A2 General Motors Corp., Deb., 9.4%,
7/15/21 $2,654,820
----------
Retail - 2.3%
1,000,000 A/A2 Penney (J.C.) Co., Inc., Deb., 9.75%,
6/15/21 $1,118,250
1,000,000 AA/Aa2 Wal-Mart Stores, Inc., Deb., 8.62%, 1/1/10 1,153,130
1,000,000 AA/Aa2 Wal-Mart Stores, Inc., Deb., 8.50%,
9/15/24 1,184,000
----------
$3,455,380
----------
Total Consumer Cyclicals
(Cost $5,471,080) $6,110,200
----------
Consumer Staples - 7.8%
Broadcasting - 5.7%
2,200,000 BBB+/Baa3 Continental Cablevision, Inc., Deb., 9.5%,
8/1/13 $2,618,880
1,500,000 BBB-/Baa3 News America Holdings, Inc., Deb.,
10.125%, 10/15/12 1,736,190
1,250,000 BBB-/Baa3 Tele-Communications, Inc., Deb., 10.125%,
4/15/22 1,757,038
</TABLE>
The accompanying notes are an integral part of these financial statements. 9
<PAGE>
Pioneer Bond Fund
SCHEDULE OF INVESTMENTS 6/30/98 (continued)
<TABLE>
<CAPTION>
S&P/Moody's
Principal Ratings
Amount (Unaudited) Value
<S> <C> <C> <C>
Broadcasting - (continued)
$2,000,000 BBB-/Baa1 Time Warner Inc., Deb., 9.15%, 2/1/23 $ 2,534,040
-----------
$ 8,646,148
-----------
Distributors (Food & Health) - 0.8%
1,000,000 BBB+/Baa1 SUPERVALU Inc., Notes, 8.875%,
11/15/22 $ 1,120,550
-----------
Household Products (Non-Durables) - 1.3%
1,500,000 AA/Aa2 Proctor & Gamble Co., Deb., 9.36%,
1/1/21 $ 1,991,010
-----------
Total Consumer Staples
(Cost $10,481,310) $11,757,708
-----------
Energy - 7.9%
Oil & Gas - 7.9%
1,000,000 BBB/Baa2 Ashland Oil Co., Deb., 8.8%, 11/15/12 $ 1,197,670
500,000 A/A2 Atlantic Richfield Co., Deb., 9.875%,
3/1/16 682,050
2,000,000 A-/A3 Kerr McGee Corp., Deb., 7.0%, 11/1/11 2,001,740
2,600,000 AA+/Aa2 Imperial Oil Ltd., Deb., 8.75%, 10/15/19 2,768,558
2,000,000 A-/A3 Phillips Petroleum Co., Deb., 9.18%,
9/15/21 2,207,160
1,200,000 A+/A1 Texaco Capital Corp., Deb., 8.25%,
10/1/06 1,365,708
1,250,000 A+/A1 Texaco Capital Corp., Deb., 9.75%,
3/15/20 1,727,700
-----------
Total Energy
(Cost $11,407,392) $11,950,586
-----------
Financial - 24.0%
Banks - 14.5%
1,000,000 A+/A1 Banc One Corp., Sub. Notes, 10.0%,
8/5/10 $ 1,300,950
1,000,000 A/A1 BankAmerica Corp., Sub. Notes, 9.375%,
3/1/01 1,083,050
2,000,000 A+/A1 Bank of Montreal, 7.8%, 4/1/07 2,217,200
1,000,000 AA-/Aa3 Barclays North American Capital Corp., Gtd.
Sub. Cap. Notes, 9.75%, 5/15/21 1,130,730
1,000,000 A/A1 The Chase Manhattan Corp., Sub. Notes,
8.5%, 2/15/02 1,074,660
</TABLE>
10 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Bond Fund
<TABLE>
<CAPTION>
S&P/Moody's
Principal Ratings
Amount (Unaudited) Value
<S> <C> <C> <C>
Banks - (continued)
$2,630,000 A/A1 The Chase Manhattan Corp., Sub. Notes,
7.125%, 6/15/09 $ 2,780,015
1,000,000 A/A1 Chemical NY Corp., Sub. Cap. Notes,
9.75%, 6/15/99 1,036,040
1,550,000 A-/A2 CoreStates Capital Corp., Gtd. Sub. Notes,
9.375%, 4/15/03 1,753,298
1,500,000 A/A2 First Chicago NBD Corp., Sub. Notes,
10.25%, 5/1/01 1,663,695
1,500,000 A-/A3 Fleet/Norstar Financial Group, Sub. Notes,
9.9%, 6/15/01 1,654,215
1,000,000 AA-/A1 J.P. Morgan & Co., Sub. Notes, 8.50%,
8/15/03 1,105,330
2,000,000 A+/A2 Mellon Bank, NA, Sub. Notes, 7.375%,
5/15/07 2,145,260
1,000,000 A/A3 Mellon Financial Co., Sub. Deb., 9.75%,
6/15/01 1,100,790
1,000,000 AA-/Aa3 National Westminster Bancorp, Inc., Gtd.
Cap. Notes, 9.375%, 11/15/03 1,145,520
500,000 AA-/A1 Republic New York Corp., Sub. Notes, 9.3%,
6/1/21 656,715
-----------
$21,847,468
-----------
Financial (Diversified) - 9.5%
2,000,000 A/A2 American General Finance Corp., 8.125%,
8/15/09 $ 2,258,940
3,000,000 A+/A1 Ford Capital BV, Deb., 9.5%, 6/1/10 3,797,910
1,500,000 AAA/Aa3 GEICO Corp., Deb., 9.15%, 9/15/21 1,678,710
1,500,000 A/A3 Deere (John) Capital Corp., 8.625%,
8/1/19 1,690,320
1,535,000 AA/Aa2 National Re Corp., Sr. Notes, 8.85%,
1/15/05 1,759,217
2,000,000 AAA/Aaa Standard Credit Card Master Trust Series
1991-3A, 8.875%, 7/7/98 2,000,160
1,000,000 A/A3 W.R. Berkley, Deb., 8.7%, 1/1/22 1,204,970
-----------
$14,390,227
-----------
Total Financial
(Cost $34,683,892) $36,237,695
-----------
</TABLE>
The accompanying notes are an integral part of these financial statements. 11
<PAGE>
Pioneer Bond Fund
SCHEDULE OF INVESTMENTS 6/30/98 (continued)
<TABLE>
<CAPTION>
S&P/Moody's
Principal Ratings
Amount (Unaudited) Value
<S> <C> <C> <C>
Transportation - 8.1%
Airlines - 5.7%
$1,741,012 BBB/A3 American Airlines, Inc., Pass-Through
Certificates, 9.71%, 1/2/07 $ 2,018,373
2,500,000 BBB/Baa1 Delta Air Lines, Inc., Pass-Through
Certificates, 9.2%, 9/23/14 3,056,900
2,096,773 A/A1 Southwest Airlines Co., Pass-Through
Certificates, 7.67%, 1/2/14 2,316,200
1,000,000 BB+/Baa3 United Air Lines Inc., Deb., 9.125%,
1/15/12 1,211,320
-----------
$ 8,602,793
-----------
Airfreight - 1.5%
2,000,000 BBB+/A3 Federal Express Corp., Pass-Through
Certificates, 8.40%, 3/23/10 $ 2,316,260
-----------
Railroads - 0.9%
1,000,000 BBB+/Baa1 Norfolk Southern Corp., Deb., 9.0%,
3/1/21 $ 1,282,570
-----------
Total Transportation
(Cost $11,454,159) $12,201,623
-----------
Utilities - 1.1%
Electric Companies - 1.1%
500,000 AAA/Aaa Cajun Electric Power, Cooperative Utilities
Trust, 10.125%, 3/15/19 $ 526,855
1,000,000 A/A2 Virginia Electric and Power Co., First
Mortgage Bonds, 8.75%, 4/1/21 1,065,780
-----------
Total Utilities
(Cost $1,565,500) $ 1,592,635
-----------
U.S. Government and Agency
Obligations - 39.5%
38,679 Federal Home Loan Mortgage Corp., 10.0%,
11/1/02 $ 40,431
51,412 Federal Home Loan Mortgage Corp., 10.5%,
4/1/19 56,954
90,981 Federal Home Loan Mortgage Corp., REMIC
Series 1988-24B, 9.5%, 1/15/05 94,521
1,500,000 Federal National Mortgage Association,
9.2%, 9/1/00 1,607,535
</TABLE>
12 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Bond Fund
<TABLE>
<CAPTION>
S&P/Moody's
Principal Ratings
Amount (Unaudited) Value
<S> <C> <C> <C>
U.S. Government and Agency
Obligations - (continued)
$1,000,000 Federal National Mortgage Association,
10.35%, 12/10/15 $1,471,800
448,464 Federal National Mortgage Association,
11.0%, 6/1/19 507,810
44,085 Federal National Mortgage Association,
10.0%, 7/1/19 48,293
2,280,467 Federal National Mortgage Association,
REMIC Series G94-6VB, 8.0%, 11/17/03 2,320,603
384,615 Federal National Mortgage Association,
REMIC Series 1989-19A, 10.3%, 4/25/19 425,249
7,751 Federal National Mortgage Association,
REMIC Series 1989-19B, 10.3%, 4/25/19 8,727
633,946 Federal National Mortgage Association,
REMIC Series 1989-72D, 8.9%, 10/25/19 655,361
198,656 Government National Mortgage Association,
10.0%, 1/15/06 209,850
258,554 Government National Mortgage Association,
10.0%, 1/15/18 285,855
69,797 Government National Mortgage Association,
9.5%, 5/15/20 75,990
297,823 Government National Mortgage Association,
10.0%, 7/15/20 328,621
8,370,777 Government National Mortgage Association,
7.5%, 5/15/27 to 6/15/27 8,603,067
77,564 Government National Mortgage Association,
Midget, 10.0%, 5/15/04 81,644
30,855 Government National Mortgage Association
II, 9.5%, 12/20/20 33,305
536,398 Resolution Trust Corp., Series 1992-5A6,
9.238%, 5/25/26 538,325
1,000,000 Tennessee Valley Authority, 8.625%,
11/15/29 1,088,130
2,000,000 U.S. Treasury Bonds, 8.25%, 5/15/05 2,092,700
2,000,000 U.S. Treasury Bonds, 8.75%, 11/5/08 2,281,440
4,500,000 U.S. Treasury Bonds, 6.375%, 8/15/27 4,943,700
4,000,000 U.S. Treasury Notes, 8.5%, 2/15/00 4,183,640
</TABLE>
The accompanying notes are an integral part of these financial statements. 13
<PAGE>
Pioneer Bond Fund
SCHEDULE OF INVESTMENTS 6/30/98 (continued)
<TABLE>
<CAPTION>
S&P/Moody's
Principal Ratings
Amount (Unaudited) Value
<S> <C> <C> <C>
U.S. Government and Agency
Obligations - (continued)
$3,000,000 U.S. Treasury Notes, 6.375%, 3/31/01 $ 3,062,910
3,500,000 U.S. Treasury Notes, 8.00%, 5/15/01 3,723,020
2,000,000 U.S. Treasury Notes, 6.50%, 5/31/01 2,049,860
2,500,000 U.S. Treasury Notes, 5.625%, 12/31/02 2,510,425
9,000,000 U.S. Treasury Notes, 7.25%, 5/15/04 9,764,550
6,000,000 U.S. Treasury Notes, 7.0%, 7/15/06 6,553,260
------------
Total U.S. Government and
Agency Obligations
(Cost $58,553,780) $ 59,647,576
------------
Foreign - 2.7%
1,000,000 AAA/Aaa Inter-American Development Bank, Notes,
9.45%, 9/15/98 $ 1,007,730
1,000,000 A/A3 Province of Saskatchewan, Deb., 9.375%,
12/15/20 1,369,530
1,500,000 A+/A2 Hydro-Quebec, Deb., 8.0%, 2/1/13 1,724,865
------------
Total Foreign
(Cost $3,750,937) $ 4,102,125
------------
TOTAL INVESTMENT IN SECURITIES
(Cost $143,245,900) $149,879,968
------------
TEMPORARY CASH
INVESTMENT - 0.7%
Commercial Paper - 0.7%
1,092,000 Texaco Inc., 6.05%, 7/1/98 $ 1,092,000
------------
TOTAL TEMPORARY CASH INVESTMENT
(Cost $1,092,000) $ 1,092,000
------------
TOTAL INVESTMENT IN SECURITIES AND
TEMPORARY CASH INVESTMENT - 100%
(Cost $144,337,900) (a)(b) $150,971,968
------------
</TABLE>
14 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Bond Fund
(a) At June 30, 1998, the net unrealized gain on investments, based on cost for
federal income tax purposes of $144,346,884 was as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized gain for all investments in which
there is an excess of value over tax cost $7,305,669
Aggregate gross unrealized loss for all investments in which
there is an excess of tax cost over value (680,585)
----------
Net unrealized gain $6,625,084
----------
</TABLE>
(b) At June 30, 1998, the Fund had a net capital loss carryforward of
$4,558,838 which will expire between 1999 and 2006 if not utilized.
Note: The Fund's investments in mortgage-backed securities of the Government
National Mortgage Association (GNMA) are interests in separate pools of
mortgages. All separate investments in this issuer which have the same
coupon rate have been aggregated for the purpose of presentation in this
schedule of investments.
Purchases and sales of securities (excluding temporary cash investments) for
the year ended June 30, 1998 were as follows:
<TABLE>
<S> <C> <C>
Purchases Sales
-------- ------
Long-Term U.S. Government $61,736,426 $49,017,560
Other Long-Term Securities 24,480,503 9,190,794
</TABLE>
The accompanying notes are an integral part of these financial statements. 15
<PAGE>
Pioneer Bond Fund
BALANCE SHEET 6/30/98
<TABLE>
<S> <C>
ASSETS:
Investment in securities, at value (including temporary cash
investment of $1,092,000) (cost $144,337,900) $150,971,968
Cash 721
Receivables -
Investment securities sold 2,532
Fund shares sold 895,111
Interest 2,826,009
Other 568
------------
Total assets $154,696,909
------------
LIABILITIES:
Payables -
Fund shares repurchased $ 452,277
Dividends 191,943
Due to affiliates 188,889
Accrued expenses 135,266
------------
Total liabilities $ 968,375
------------
NET ASSETS:
Paid-in capital $151,800,225
Accumulated undistributed net investment income 15,047
Accumulated net realized loss on investments (4,720,806)
Net unrealized gain on investments 6,634,068
------------
Total net assets $153,728,534
------------
NET ASSET VALUE PER SHARE:
(Unlimited number of shares authorized)
Class A (based on $114,325,566/12,202,078 shares) $ 9.37
------------
Class B (based on $30,888,217/3,311,042 shares) $ 9.33
------------
Class C (based on $8,514,751/914,450 shares) $ 9.31
------------
MAXIMUM OFFERING PRICE:
Class A $ 9.81
------------
</TABLE>
16 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Bond Fund
STATEMENT OF OPERATIONS
For the Year Ended Ended 6/30/98
<TABLE>
<CAPTION>
INVESTMENT INCOME:
<S> <C> <C>
Interest $10,473,251
-----------
EXPENSES:
Management fees $696,789
Transfer agent fees
Class A 179,464
Class B 53,889
Class C 10,659
Distribution fees
Class A 267,315
Class B 248,383
Class C 75,697
Accounting 74,672
Custodian fees 32,938
Registration fees 127,138
Professional fees 57,916
Printing 19,597
Fees and expenses of nonaffiliated trustees 16,688
Miscellaneous 33,741
--------
Total expenses $ 1,894,886
Less fees paid indirectly (8,176)
-----------
Net expenses $ 1,886,710
-----------
Net investment income $ 8,586,541
-----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized loss on investments $ (27,677)
Change in net unrealized gain on investments 4,226,062
-----------
Net gain on investments $ 4,198,385
-----------
Net increase in net assets resulting from operations $12,784,926
-----------
</TABLE>
The accompanying notes are an integral part of these financial statements. 17
<PAGE>
Pioneer Bond Fund
STATEMENTS OF CHANGES IN NET ASSETS
For the Years Ended 6/30/98 and 6/30/97
<TABLE>
<CAPTION>
Year Ended Year Ended
FROM OPERATIONS: 6/30/98 6/30/97
<S> <C> <C>
Net investment income $ 8,586,541 $ 8,172,340
Net realized loss on investments (27,677) (969,154)
Change in net unrealized gain on investments 4,226,062 832,463
------------ ------------
Net increase in net assets resulting from operations $ 12,784,926 $ 8,035,649
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income:
Class A ($0.59 and $0.63 per share, respectively) $ (6,776,551) $ (6,943,232)
Class B ($0.52 and $0.54 per share, respectively) (1,379,864) (1,082,662)
Class C ($0.52 and $0.54 per share, respectively) (423,824) (108,347)
------------ ------------
Total distributions to shareholders $ (8,580,239) $ (8,134,241)
------------ ------------
FROM FUND SHARE TRANSACTIONS:
Net proceeds from sale of shares $ 79,685,588 $ 37,432,588
Reinvestment of distributions 6,168,312 5,838,102
Cost of shares repurchased (59,332,386) (37,312,197)
------------ ------------
Net increase in net assets resulting from fund share
transactions $ 26,521,514 $ 5,958,493
------------ ------------
Net increase in net assets $ 30,726,201 $ 5,859,901
NET ASSETS:
Beginning of year 123,002,333 117,142,432
------------ ------------
End of year (including accumulated undistributed net
investment income of $15,047 and $0, respectively) $153,728,534 $123,002,333
------------ ------------
</TABLE>
<TABLE>
<CAPTION>
CLASS A '98 Shares '98 Amount '97 Shares '97 Amount
<S> <C> <C> <C> <C>
Shares sold 4,618,197 $42,978,625 2,220,001 $20,119,015
Reinvestment of distributions 553,400 5,150,324 561,906 5,097,205
Less shares repurchased (3,811,048) (35,457,410) (3,170,150) (28,744,746)
---------- ----------- ---------- -----------
Net increase (decrease) 1,360,549 $12,671,539 (388,243) $(3,528,526)
---------- ----------- ---------- -----------
CLASS B
Shares sold 2,194,576 $20,360,306 1,277,126 $11,519,150
Reinvestment of distributions 92,814 860,618 76,366 689,363
Less shares repurchased (1,202,753) (11,149,336) (772,104) (6,961,177)
---------- ----------- ---------- -----------
Net increase 1,084,637 $10,071,588 581,388 $ 5,247,336
---------- ----------- ---------- -----------
CLASS C
Shares sold 1,763,437 $16,346,657 643,707 $ 5,794,423
Reinvestment of distributions 16,991 157,370 5,723 51,534
Less shares repurchased (1,374,869) (12,725,640) (178,517) (1,606,274)
---------- ----------- ---------- -----------
Net increase 405,559 $ 3,778,387 470,913 $ 4,239,683
---------- ----------- ---------- -----------
</TABLE>
18 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Bond Fund
FINANCIAL HIGHLIGHTS 6/30/98
<TABLE>
<CAPTION>
Year Ended Year Ended Year Ended Year Ended Year Ended
6/30/98 6/30/97 6/30/96 6/30/95 6/30/94
<S> <C> <C> <C> <C> <C>
CLASS A
Net asset value, beginning of year $ 9.07 $ 9.08 $ 9.35 $ 9.04 $ 9.81
------- ------- ------- ------- -------
Increase (decrease) from investment operations:
Net investment income $ 0.59 $ 0.63 $ 0.64 $ 0.68 $ 0.67
Net realized and unrealized gain (loss) on investments 0.30 (0.01) (0.27) 0.31 (0.77)
------- ------- ------- ------- -------
Net increase (decrease) from investment operations $ 0.89 $ 0.62 $ 0.37 $ 0.99 $ (0.10)
Distributions to shareholders:
Net investment income (0.59) (0.63) (0.64) (0.68) (0.67)
------- ------- ------- -------- -------
Net increase (decrease) in net asset value $ 0.30 $ (0.01) $ (0.27) $ 0.31 $ (0.77)
------- ------- ------- -------- -------
Net asset value, end of year $ 9.37 $ 9.07 $ 9.08 $ 9.35 $ 9.04
------- ------- ------- -------- -------
Total return* 10.04% 7.09% 4.02% 11.48% (1.26)%
Ratio of net expenses to average net assets 1.18%+ 1.14%+ 1.19%+ 1.14% 1.05%
Ratio of net investment income to average net assets 6.34%+ 6.97%+ 6.80%+ 7.55% 6.93%
Portfolio turnover rate 44% 48% 39% 37% 39%
Net assets, end of year (in thousands) $114,326 $98,310 $101,957 $110,158 $106,659
Ratios assuming reduction for fees paid indirectly:
Net expenses 1.17% 1.12% 1.18% - -
Net investment income 6.35% 6.99% 6.81% - -
</TABLE>
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
+ Ratio assuming no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements. 19
<PAGE>
Pioneer Bond Fund
FINANCIAL HIGHLIGHTS 6/30/98
<TABLE>
<CAPTION>
Year Ended Year Ended Year Ended Year Ended 4/4/94 to
6/30/98 6/30/97 6/30/96 6/30/95 6/30/94
<S> <C> <C> <C> <C> <C>
CLASS B
Net asset value, beginning of period $ 9.03 $ 9.02 $ 9.31 $ 9.02 $ 9.23
------- ------- ------- ------ ------
Increase (decrease) from investment operations:
Net investment income $ 0.51 $ 0.56 $ 0.57 $ 0.60 $ 0.14
Net realized and unrealized gain (loss) on investments 0.31 (0.01) (0.28) 0.31 (0.21)
------- ------- ------- ------ -------
Net increase (decrease) from investment operations $ 0.82 $ 0.55 $ 0.29 $ 0.91 $ (0.07)
Distributions to shareholders:
Net investment income (0.52) (0.54) (0.57) (0.62) (0.14)
In excess of net investment income - - (0.01) - -
------- ------- ------- ------- -------
Net increase (decrease) in net asset value $ 0.30 $ 0.01 $ (0.29) $ 0.29 $ (0.21)
------- ------- ------- ------- -------
Net asset value, end of period $ 9.33 $ 9.03 $ 9.02 $ 9.31 $ 9.02
------- ------- ------- ------- -------
Total return* 9.21% 6.24% 3.15% 10.57% (0.73)%
Ratio of net expenses to average net assets 1.98%+ 1.97%+ 1.96%+ 1.97% 1.92%**
Ratio of net investment income to average net assets 5.52%+ 6.12%+ 6.01%+ 6.60% 6.09%**
Portfolio turnover rate 44% 48% 39% 37% 39%
Net assets, end of period (in thousands) $30,888 $20,104 $14,843 $ 7,338 $ 1,212
Ratios assuming reduction for fees paid indirectly:
Net expenses 1.97% 1.96% 1.94% - -
Net investment income 5.53% 6.13% 6.03% - -
</TABLE>
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized.
+ Ratio assuming no reduction for fees paid indirectly.
20 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Bond Fund
FINANCIAL HIGHLIGHTS 6/30/98
<TABLE>
<CAPTION>
Year Ended Year Ended 1/31/96 to
6/30/98 6/30/97 6/30/96
<S> <C> <C> <C>
CLASS C
Net asset value, beginning of period $ 9.02 $ 9.02 $ 9.54
------- ------- -------
Increase (decrease) from investment operations:
Net investment income $ 0.52 $ 0.54 $ 0.23
Net realized and unrealized gain (loss) on
investments 0.29 - (0.52)
------- ------- --------
Net increase (decrease) from investment
operations $ 0.81 $ 0.54 $ (0.29)
Distributions to shareholders:
Net investment income (0.52) (0.54) (0.22)
In excess of net investment income - - (0.01)
------- ------- --------
Net increase (decrease) in net asset value $ 0.29 $ - $ (0.52)
------- ------- --------
Net asset value, end of period $ 9.31 $ 9.02 $ 9.02
------- ------- --------
Total return* 9.12% 6.13% (3.00)%
Ratio of net expenses to average net assets 1.90%+ 2.05%+ 2.18%**+
Ratio of net investment income to average net
assets 5.58%+ 5.83%+ 5.79%**+
Portfolio turnover rate 44% 48% 39%
Net assets, end of period (in thousands) $ 8,515 $ 4,588 $ 343
Ratios assuming reduction for fees paid indirectly:
Net expenses 1.89% 1.92% 2.13%**
Net investment income 5.59% 5.96% 5.84%**
</TABLE>
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized.
+ Ratio assuming no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements. 21
<PAGE>
Pioneer Bond Fund
NOTES TO FINANCIAL STATEMENTS 6/30/98
1. Organization and Significant Accounting Policies
Pioneer Bond Fund (the Fund) is a Massachusetts business trust registered under
the Investment Company Act of 1940 as a diversified, open-end management
investment company. The investment objective of the Fund is to seek current
income consistent with preservation of capital.
The Fund offers three classes of shares--Class A, Class B and Class C shares.
The shares of Class A, Class B, and Class C each represent an interest in the
same portfolio of investments of the Fund and have equal rights to voting,
redemptions, dividends and liquidation, except that each class of shares can
bear different transfer agent and distribution fees and have exclusive voting
rights with respect to the distribution plans that have been adopted by Class
A, Class B, and Class C shareholders, respectively.
The Fund's financial statements have been prepared in conformity with generally
accepted accounting principles that require the management of the Fund to,
among other things, make estimates and assumptions that affect the reported
amounts of assets and liabilities, the disclosure of contingent assets and
liabilities at the date of the financial statements, and the reported amounts
of revenues and expenses during the reporting periods. Actual results could
differ from those estimates. The following is a summary of significant
accounting policies consistently followed by the Fund, which are in conformity
with those generally accepted in the investment company industry:
A. Security Valuation
Security transactions are recorded on trade date. Securities are valued at
prices supplied by independent pricing services, which consider such factors
as Treasury spreads, yields, maturities and ratings. Valuations may be
supplemented by dealers and other sources, as required. Principal amounts of
mortgage-backed securities are adjusted for monthly paydowns. Premium and
discount related to certain mortgage-backed securities are amortized or
accreted in proportion to the underlying monthly paydowns. Interest income
is recorded on the accrual basis. Temporary cash investments are valued at
amortized cost.
Gains and losses on sales of investments are calculated on the identified
cost method for both financial reporting and federal income tax purposes. It
is the Fund's practice to first select for sale those securities that have
the highest cost and also qualify for long-term capital gain or loss
treatment for tax purposes.
22
<PAGE>
Pioneer Bond Fund
B. Federal Income Taxes
It is the Fund's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute
all of its taxable income and net realized capital gains, if any, to its
shareholders. Therefore, no federal income tax provision is required.
The characterization of distributions to shareholders for financial
reporting purposes is determined in accordance with federal income tax
rules. Therefore, the source of the Fund's distributions may be shown in the
accompanying financial statements as either from or in excess of net
investment income or net realized gain on investment transactions, or from
paid-in capital, depending on the type of book/tax differences that may
exist.
At June 30, 1998, the Fund reclassified $8,745 from accumulated net realized
loss on investments to accumulated undistributed net investment income. The
reclassification has no impact on the net asset value of the Fund and is
designed to present the Fund's capital accounts on a tax basis.
C. Fund Shares
The Fund records sales and repurchases of its shares on trade date. Net
losses, if any, as a result of cancellations are absorbed by Pioneer Funds
Distributor, Inc. (PFD), the principal underwriter for the Fund and an
indirect subsidiary of The Pioneer Group, Inc. (PGI). PFD earned $38,052 in
underwriting commissions on the sale of fund shares for the year ended June
30, 1998.
D. Class Allocations
Distribution fees are calculated based on the average daily net asset value
attributable to Class A, Class B, and Class C shares of the Fund,
respectively. Shareholders of each class share all expenses and fees paid to
the transfer agent, Pioneering Services Corporation (PSC), for their
services, which are allocated based on the number of accounts in each class
and the ratable allocation of related out-of-pocket expenses (see Note 3).
Income, common expenses, and realized and unrealized gains and losses are
calculated at the Fund level and allocated daily to each class of shares
based on the respective percentage of adjusted net assets at the beginning
of the day.
The Fund declares as daily dividends substantially all of its net investment
income. All dividends are paid on a monthly basis. Short-term capi-
23
<PAGE>
Pioneer Bond Fund
NOTES TO FINANCIAL STATEMENTS 6/30/98 (continued)
tal gain distributions, if any, may be declared with the daily dividends.
Distributions to shareholders are recorded as of the ex-dividend date.
Distributions paid by the Fund with respect to each class of shares are
calculated in the same manner, at the same time, and in the same amount,
except that Class A, Class B, and Class C shares can bear different transfer
agent and distribution fees.
2. Management Agreement
Pioneering Management Corporation (PMC), the Fund's investment adviser, manages
the Fund's portfolio and is a wholly owned subsidiary of PGI. Management fees
are calculated daily at the annual rate of 0.50% of the Fund's average daily
net assets.
In addition, under the management agreement, certain other services and costs,
including accounting, regulatory reporting, and insurance premiums, are paid by
the Fund. At June 30, 1998, $67,710 was payable to PMC related to management
fees and certain other services.
3. Transfer Agent
PSC, a wholly owned subsidiary of PGI, provides substantially all transfer
agent and shareholder services to the Fund at negotiated rates. Included in due
to affiliates is $29,711 in transfer agent fees payable to PSC at June 30,
1998.
4. Distribution Plans
The Fund adopted a Plan of Distribution for each class of shares (Class A Plan,
Class B Plan and Class C Plan) in accordance with Rule 12b-1 of the Investment
Company Act of 1940. Pursuant to the Class A Plan, the fund pays PFD a service
fee of up to 0.25% of the Fund's average daily net assets in reimbursement of
its actual expenditures to finance activities primarily intended to result in
the sale of Class A shares. Pursuant to the Class B Plan and the Class C Plan,
the Fund pays PFD 1.00% of the average daily net assets attributable to each
class of shares. The fee consists of a 0.25% service fee and a 0.75%
distribution fee paid as compensation for personal services and/or account
maintenance services or distribution services with regard to Class B and Class
C shares. Included in due to affiliates is $91,468 in distribution fees payable
to PFD at June 30, 1998.
In addition, redemptions of each class of shares may be subject to a contingent
deferred sales charge (CDSC). A CDSC of 1.00% may be imposed on redemptions of
certain net asset value purchases of Class A shares within one year of
purchase. Class B shares that are redeemed within six
24
<PAGE>
Pioneer Bond Fund
years of purchase are subject to a CDSC at declining rates beginning at 4.0%,
based on the lower of cost or market value of shares being redeemed.
Redemptions of Class C shares within one year of purchase are subject to a CDSC
of 1.0%. Proceeds from the CDSCs are paid to PFD. For the year ended June 30,
1998, CDSCs in the amount of $81,811 were paid to PFD.
5. Expense Offsets
The Fund has entered into certain expense offset arrangements resulting in a
reduction in the Fund's total expenses. For the year ended June 30, 1998, the
Fund's expenses were reduced by $8,176 under such arrangements.
25
<PAGE>
Pioneer Bond Fund
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Shareholders and the Board of Trustees of Pioneer Bond Fund:
We have audited the accompanying balance sheet, including the schedule of
investments, of Pioneer Bond Fund as of June 30, 1998, and the related
statement of operations, statements of changes in net assets, and financial
highlights for the periods presented. These financial statements and the
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. Our procedures included confirmation of securities owned as of June
30, 1998, by correspondence with the custodian. 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
Pioneer Bond Fund as of June 30, 1998, the results of its operations, the
changes in its net assets and the financial highlights for the periods
presented, in conformity with generally accepted accounting principles.
ARTHUR ANDERSEN LLP
Boston, Massachusetts
August 7, 1998
26
<PAGE>
Pioneer Bond Fund
TRUSTEES, OFFICERS AND SERVICE PROVIDERS
Officers Trustees
John F. Cogan, Jr. John F. Cogan, Jr., Chairman and
Mary K. Bush President
Richard H. Egdahl, M.D. David D. Tripple, Executive Vice
Margaret B.W. Graham President
John W. Kendrick Sherman B. Russ, Vice President
Marguerite A. Piret William H. Keough, Treasurer
David D. Tripple Joseph P. Barri, Secretary
Stephen K. West
John Winthrop
Investment Adviser
Pioneering Management Corporation
Custodian
Brown Brothers Harriman & Co.
Independent Public Accountants
Arthur Andersen LLP
Principal Underwriter
Pioneer Funds Distributor, Inc.
Legal Counsel
Hale and Dorr LLP
Shareowner Services and Transfer Agent
Pioneering Services Corporation
27
<PAGE>
Pioneer Bond Fund
THE PIONEER FAMILY OF MUTUAL FUNDS
For information about any Pioneer mutual fund, please contact your investment
representative, or call Pioneer at 1-800-225-6292. Ask for a free fund
information kit, which includes a fund prospectus. Please read the prospectus
carefully before you invest or send money.
Growth Funds Income Funds
Global/International Taxable
Pioneer Emerging Markets Fund Pioneer America Income Trust
Pioneer Europe Fund Pioneer Bond Fund
Pioneer Gold Shares Pioneer Short-Term Income Trust
Pioneer International Growth Fund
Pioneer World Equity Fund Tax-Exempt
Pioneer Intermediate Tax-Free Fund
Pioneer Tax-Free Income Fund
United States
Pioneer Capital Growth Fund
Pioneer Growth Shares Money Market Fund
Pioneer Micro-Cap Fund Pioneer Cash Reserves Fund
Pioneer Mid-Cap Fund
Pioneer Small Company Fund
Growth and Income Funds
Pioneer Balanced Fund
Pioneer Equity-Income Fund
Pioneer Fund
Pioneer Real Estate Shares
Pioneer II
28
<PAGE>
RETIREMENT PLANS FROM PIONEER
Pioneer offers retirement plans suited to the individual investor and
businesses of all sizes. For information, contact your investment professional,
or call Pioneer at 1-800-622-0176.
Individual Plans
Individual Retirement Account (IRA) The $2,000 maximum annual contribution may
be tax-deductible; earnings are tax-deferred.
Roth IRA New in 1998, $2,000 maximum annual contributions are
not tax-deductible. Earnings are tax-free for qualified withdrawals.
Plans for Small Businesses or the Self-Employed
SIMPLE (Savings Incentive Match PLan for Employees)
IRA or 401(k) Plan For firms with 100 or fewer employees. Employees
can make pre-tax contributions of up to $6,000 annually, and an employer
contribution is required.
Simplified Employee Pension Plan (SEP) Self-employed people and small-business
owners can make tax-deductible contributions of up to 15% of their income.
Employer-Sponsored Plans
401(k) Plan Allows employees to make pre-tax contributions. Also
allows for employer contributions.
403(b) Plan Lets employees of tax-exempt organizations set aside
part of their salary, before taxes, through payroll deduction.
Profit Sharing Plan Employers contribute on a discretionary basis,
usually based on profits.
Age-Weighted Profit Sharing Plan Employer makes discretionary contributions
based on employees' age and salary.
Money Purchase Pension Plan (MPP) Employers contribute based on
a fixed formula.
Most retirement plan withdrawals must meet specific conditions to avoid
penalties.
29
<PAGE>
HOW TO CONTACT PIONEER
We are pleased to offer a variety of convenient ways for you to contact us for
assistance or information.
Call us for:
Account information, including existing accounts,
new accounts, prospectuses, applications
and service forms 1-800-225-6292
FactFone(SM) for automated fund yields, prices,
account information and transactions 1-800-225-4321
Retirement plans information 1-800-622-0176
Telecommunications Device for the Deaf (TDD) 1-800-225-1997
Write to us:
Pioneering Services Corporation
60 State Street
Boston, Massachusetts 02109
Our toll-free fax 1-800-225-4240
Our Internet e-mail address [email protected]
(for general questions about Pioneer only)
Visit our web site: www.pioneerfunds.com
This report must be preceded or accompanied by a current
Fund prospectus.
[PIONEER LOGO]
Pioneer Funds Distributor, Inc.
60 State Street 0898-5432
Boston, Massachusetts 02109 (C) Pioneer Funds Distributor, Inc.
www.pioneerfunds.com [RECYCLE SYMBOL] Printed on Recycled Paper
