DELAWARE GROUP EQUITY FUNDS I INC, 497, 1999-02-16

DELAWARE GROUP EQUITY FUNDS I INC
497, 1999-02-16

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<PAGE>
DELAWARE
INVESTMENTS
---------------------
PHILADELPHIA * LONDON

Delaware
Balanced Fund
(formerly Delaware Fund)

Devon Fund
Institutional Class

Prospectus January 15, 1999
(revised February 12, 1999)

[photo of illustration from Total Return brochure]

Total Return Funds

The Securities and Exchange Commission has not approved or disapproved
these securities or passed upon the accuracy of this prospectus, and any
representation to the contrary is a criminal offense.

<PAGE>

Table of contents

.................................................................
Fund profiles page 1
Delaware Balanced Fund 2
Devon Fund 4
.................................................................
How we manage the Funds page 6
Our investment strategies 6
The securities we typically invest in 7
The risks of investing in the Funds 9
.................................................................
Who manages the Funds page 10
Investment manager 10
Portfolio managers 10
Fund administration (Who's who) 11
.................................................................
About your account page 12
Investing in the Funds 12
How to buy shares 13
How to redeem shares 15
Account minimum 16
Exchanges 16
Dividends, distributions and taxes 17

.................................................................
Certain management considerations page 17

.................................................................
Financial information page 18

How to use
this prospectus

Here are guidelines to help you use this prospectus to make well-informed
investment decisions about our funds. If you're looking for a specific piece of
information, the table of contents can guide you directly to the appropriate
section.

Step 1
- --------------------------------------------------------------------------------
Take a look at the fund profiles for an overview of each Fund.

Step 2
- --------------------------------------------------------------------------------
Learn in-depth information about how the Funds invest, the risks involved and
the people and organizations responsible for the Funds' day-to-day operations.

Step 3
- --------------------------------------------------------------------------------
Determine which fund features and services you would like to take advantage of.

Step 4
- --------------------------------------------------------------------------------
Use the glossary that begins on page 6 to find definitions of words printed in
bold type in the text throughout the prospectus.

<PAGE>

Fund Profiles:
An investment overview

When choosing a mutual fund to invest in, you have a variety of options and
important information to consider. This prospectus provides information about
Delaware Balanced Fund and Devon Fund, two mutual funds from the Delaware
Investments Family of Funds.

Before evaluating individual funds, however, your first step is to define your
personal financial goals. Knowing your goals and determining your investment
time horizon in advance can help you make a more appropriate fund selection. It
is also important to select a fund in the context of your entire investment
program. Diversification, or spreading your money among different types of
investments, is usually a sound investment strategy. This is commonly called
"asset allocation." The way you choose to allocate your money depends on a
number of factors. A professional financial adviser can help you build an
investment portfolio that fits your financial situation, your investment
objectives and your risk tolerance.

Investing for total return with Delaware Balanced Fund and Devon Fund

Delaware Balanced Fund and Devon Fund are both total return funds. Investors
with long-term goals often choose mutual funds designed to provide total return.
Total return funds typically provide moderate growth potential as well as some
current income. They generally involve less risk than aggressive stock funds but
more risk than bond funds. Like all mutual funds, total return funds allow you
to invest conveniently in a diversified portfolio without having to select and
monitor individual securities on your own.

Building Blocks of Asset Allocation

Aggressive Growth Equity Funds

International and Global Funds

Asset Allocation Funds

Growth Equity Funds

Moderate Growth Equity Funds for...

Total Return
These stock funds provide moderate growth potential as well as some current
income, with generally less risk than aggressive stock funds but more risk than
bond funds.

Taxable Bond Funds

Tax-ExemptBond Funds

Money Market Funds (Taxable and Tax-Exempt)

1
<PAGE>

What are the Fund's goals?

Delaware Balanced Fund seeks a balance of capital appreciation, income and
preservation of capital. Although the Fund will strive to achieve its goal,
there is no assurance that it will.

Who should invest in the Fund
o Investors with long-term financial goals.
o Investors looking for stocks and bonds combined in a single investment.
o Investors seeking modest quarterly income.
o Investors seeking a measure of capital preservation.

Who should not invest in the Fund
o Investors with short-term financial goals.
o Investors who are unwilling to accept share prices that may fluctuate,
sometimes significantly, over the short term.

How has Delaware Balanced Fund performed?
- --------------------------------------------------------------------------------
This bar chart and table can help you evaluate the potential risks of investing
in the Fund. We show how returns for the Fund's Institutional Class shares have
varied over the past ten calendar years, as well as the average annual returns
for one, five and ten years -- all compared to the performance of the S&P 500
Index and the Lehman Brothers Aggregate Bond Index. Delaware Balanced Fund's
Institutional Class commenced operations on November 9, 1992. Return information
for the Class for the periods prior to the time the Class commenced operations
is calculated by taking the performance of Delaware Balanced Fund A Class and
eliminating all sales charges that apply to Class A shares. However, for those
periods, Class A 12b-1 payments were not eliminated, and performance would have
been affected if this adjustment had been made. You should remember that unlike
the Fund, the indexes are unmanaged and don't reflect the actual costs of
operating a mutual fund, such as the costs of buying, selling, and holding
securities. Neither index is a perfect comparison to Delaware Balanced Fund
since the S&P 500 does not include fixed-income securities and the Lehman
Brothers Aggregate Bond Index does not include stocks. The Fund's past
performance does not necessarily indicate how it will perform in the future.

Year-by-year total return (Institutional Class)

o Delaware Balanced Fund
o S&P 500
o Lehman Brothers Aggregate Bond Index

Lehman Bros. Agg.
Delaware Balanced Fund S&P Bond Index
---------------------- --- -----------------
1989 25.60% 31.50% 14.53%
1990 -0.50% -3.20% 8.96%
1991 20.60% 30.60% 16.00%
1992 12.70% 7.70% 7.40%
1993 9.40% 10.00% 9.75%
1994 -1.40% 1.30% -2.92%
1995 26.15% 37.40% 18.47%
1996 14.13% 23.10% 3.63%
1997 24.77% 33.40% 9.65%
1998 17.58% 28.74% 8.69%

As of December 31, 1998, the Institutional Class had a year-to-date return of
17.58%. During the ten years illustrated in this bar chart, the Institutional
Class' highest return was 15.10% for the quarter ended December 1998 and its
lowest return was -9.11% in the quarter ended September 1990.

What are the Fund's main investment strategies? We invest primarily in common
stocks of established companies we believe have the potential for long-term
capital appreciation. In addition, we invest at least 25% of the Fund's assets
in various types of fixed-income securities, including U.S.government securities
and corporate bonds. Funds with this mix of stocks and bonds are commonly known
as balancedfunds.

What are the main risks of investing in the Fund? Investing in any mutual fund
involves risk, including the risk that you may lose part or all of the money you
invest. The price of Fund shares will increase and decrease according to changes
in the value of the Fund's investments. This Fund will be affected primarily by
declines in stock and bond prices which can be caused by a drop in the stock or
bond market, an adverse change in interest rates or poor performance in specific
industries or companies. For a more complete discussion of risk, please turn to
page 9.

An investment in the Fund is not a deposit of any bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other
government agency.

You should keep in mind that an investment in the Fund is not a complete
investment program; it should be considered just one part of your total
financial plan. Be sure to discuss this Fund with your financial adviser to
determine whether it is an appropriate choice for you.

2
<PAGE>
How has Delaware Balanced Fund performed? (continued)
- --------------------------------------------------------------------------------

Average annual return as of 12/31/98
<TABLE>
<CAPTION>
=================================================================================================
Lehman Brothers
Institutional Class S&P 500 Aggregate Bond Index
=================================================================================================
<S> <C> <C> <C>
1 year 17.58% 28.74% 8.69%
- -------------------------------------------------------------------------------------------------
5 years 15.86% 24.08% 7.27%
- -------------------------------------------------------------------------------------------------
10 years 14.55% 19.20% 9.26%
- -------------------------------------------------------------------------------------------------
</TABLE>

What are the Fund's fees and expenses?
<TABLE>
<CAPTION>

- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
You do not pay sales charges directly Maximum sales charge (load) imposed on
from your investments when you buy or sell purchases as a percentage of offering price none
shares of the Institutional Class. Maximum contingent deferred sales charge (load)
as a percentage of original purchase price or
redemption price, whichever is lower none
Maximum sales charge (load) imposed on
reinvested dividends none
Redemption fees none
Exchange Fees(1) none

- -----------------------------------------------------------------------------------------------------------------

Annual fund operating expenses are deducted Management fees 0.50%
from the Fund's assets before it pays Distribution and service (12b-1) fees none
dividends and before its net asset value Other expenses 0.27%
and total return are calculated. We will Total operating expenses 0.77%
not charge you separately for these expenses.
These expenses are based on amounts incurred
during the Fund's most recent fiscal year.

- -----------------------------------------------------------------------------------------------------------------

This example is intended to help you compare 1 year $79
the cost of investing in the Fund to the cost 3 years $246
of investing in other mutual funds with 5 years $428
similar investment objectives. We show the 10 years $954
cumulative amount of Fund expenses on a
hypothetical investment of $10,000 with an
annual 5% return over the time shown.(2)
This is an example only, and does not
representfuture expenses, which may be
greater or less than those shown here.

</TABLE>

(1) Exchanges are subject to the requirements of each fund in the Delaware
Investments family. A front-end sales charge may apply if you exchange your
shares into a fund that has a front-end sales charge.
(2) The Fund's actual rate of return may be greater or less than the
hypothetical 5% return we use here. Also, this example assumes that the
Fund's total operating expenses remain unchanged in each of the periods we
show.

3
<PAGE>

What are the Fund's goals?

Devon Fund seeks current income and capital appreciation. Although the Fund
will strive to achieve its goal, there is no assurance that it will.

Who should invest in the Fund

o Investors with long-term financial goals.
o Investors seeking long-term capital appreciation.
o Investors seeking an investment primarily in common stocks.

Who should not invest in the Fund
o Investors seeking an investment primarily in fixed-income
securities.
o Investors with short-term financial goals.
o Investors who are unwilling to accept share prices that may fluctuate,
sometimes significantly over the short term.

How has Devon Fund performed?
- --------------------------------------------------------------------------------
This bar chart and table can help you evaluate the risks of investing in the
Fund. We show how returns for the Fund's Institutional Class shares have varied
over the five calendar years since its inception, as well as the average annual
returns of these shares for the past year and since inception--all compared to
the performance of the S&P 500 Index. You should remember that unlike the Fund,
the index is unmanaged and doesn't include the costs of operating a mutual fund,
such as the costs of buying, selling, and holding the securities. The Fund's
past performance is not necessarily an indication of how it will perform in the
future. The returns reflect voluntary expense caps. The returns would be lower
without the voluntary caps.

o Devon Fund
o S&P 500

- --------------------------------------------------------------------------------
Year-by-year total return (Institutional Class)

Devon Fund S&P 500
---------- -------
1994 5.93% 1.30%
1995 35.96% 37.40%
1996 22.20% 23.10%
1997 35.33% 33.40%
1998 22.52% 28.74%

As of December 31, 1998, the Institutional Class had a year-to-date return of
22.52%. During the five years illustrated in this bar chart, the Institutional
Class' highest return was 20.73% for the quarter ended December 1998 and its
lowest return was -8.90% for the quarter ended September 1998.

What are the Fund's main investment strategies? We invest primarily in
income-producing common stocks of companies. We focus on common stocks that we
believe have the potential for above-average dividend increases over time.

What are the main risks of investing in the Fund? Investing in any mutual fund
involves risk, including the risk that you may lose part or all of the money you
invest. The price of Fund shares will increase and decrease according to changes
in the value of the Fund's investments. This Fund will be par ticularly affected
by changes in stock prices, which tend to fluctuate more than bond prices. Stock
prices may be negatively affected by declines in the stock market or poor
performance in specific industries or companies. For a more complete discussion
of risk, please turn to page 9.

Moreover, an investment in the Fund is not a deposit of any bank and is not
insured or guaranteed by the Federal Deposit Insurance Corporation or any other
government agency.

4
<PAGE>

How has Devon Fund performed? (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C>
Average annual return as of 12/31/98
Institutional Class S&P500
1 year 22.52% 28.74%
5 years 24.09% 24.08%
Since inception (12/29/93) 24.14% 24.08%

What are the Fund's fees and expenses?
- -------------------------------------------------------------------------------------------------------------------------

You do not pay sales charges directly Maximum sales charge (load) imposed on
from your investments when you buy or sell purchases as a percentage of offering price none
shares of the Institutional Class. Maximum contingent deferred sales charge (load)
as a percentage of original purchase price or
redemption price, whichever is lower none
Maximum sales charge (load) imposed on
reinvested dividends none
Redemption fees none
Exchange Fees(1) none

- -------------------------------------------------------------------------------------------------------------------------
Annual fund operating expenses are deducted Management fees 0.60%
from the Fund's assets before it pays dividends Distribution and service (12b-1) fees none
and before its net asset value and total return Other expenses 0.50%
are calculated. We will not charge you Total operating expenses(2) 1.10%
separately for these expenses. These expenses
are based on amounts incurred during the Fund's
most recent fiscal year.

- -------------------------------------------------------------------------------------------------------------------------
This example is intended to help you compare 1 year $112
the cost of investing in the Fund to the cost 3 years $350
of investing in other mutual funds with similar 5 years $606
investment objectives. We show the cumulative 10 years $1,340
amount of Fund expenses on a hypothetical
investment of $10,000 with an annual 5% return
over the time shown.(3) This is an example only,
and does not represent future expenses, which
may be greater or less than those shown here.

</TABLE>

(1) Exchanges are subject to the requirements of each fund in the Delaware
Investments family. A front-end sales charge may apply if you exchange your
shares into a fund that has a front-end sales charge.
(2) The investment manager has agreed to waive fees and pay expenses in order to
prevent total operating expenses (excluding any taxes, interest, brokerage
fees and extraordinary expenses) from exceeding 1% of average daily net
assets through June 30, 1999.
(3) The Fund's actual rate of return may be greater or less than the
hypothetical 5% return we use here. Also, this example assumes that the
Fund's total operating expenses remain unchanged in each of the periods we
show. In addition, this example does not reflect the voluntary expense caps
described in footnote 2.

5
<PAGE>

Our investment strategies
We research individual companies and analyze economic and market conditions,
seeking to identify the securities or market sectors that we think are the best
investments for a particular Fund. Following are descriptions of how the
portfolio managers pursue the Funds' investment goals.

We take a disciplined approach to investing, combining investment strategies and
risk management techniques that can help shareholders meet their goals.

Delaware Balanced Fund
Delaware Balanced Fund is a type of total return fund that invests in both
stocks and bonds to pursue a three-pronged investment objective: capital
appreciation, current income and preservation of principal. We blend several
investment strategies to manage this Fund.

We seek capital appreciation by investing primarily in the common stocks of
established companies that we believe have long-term capital growth potential.
We focus on dividend-paying, undervalued stocks.

To seek current income and help preserve capital, we generally invest at least
25% of the Fund's net assets in various types of fixed-income securities,
including U.S. government and government agency securities and corporate bonds.
We generally in vest in bonds that have bond ratings in the top four grades
according to a nationally recognized statistical rating organization (NRSRO) at
the time we buy them. We buy unrated bonds only if we determine them to be
equivalent to one of the top four grades. Each bond in the portfolio will have a
maturity between five and 30 years, and the average maturity of the portfolio
will typically be between five and ten years.

We conduct ongoing analysis of the different markets to determine the
appropriate mix of stocks and bonds for the current economic and investment
environment.

Devon Fund
Devon Fund is also a total return fund, but it invests the majority of its
assets in stocks. This Fund has a dual objective of capital appreciation and
current income, but since it invests primarily in stocks, its shareholders
should be comfortable accepting somewhat greater fluctuation of principal than
with Delaware Balanced Fund.

For Devon Fund, we invest primarily in common stocks that we believe have the
potential for above-average dividend increases over time. Generally, at least
65% of the Fund's assets will be in dividend-paying stocks.

In selecting stocks for both Devon Fund and Delaware Balanced Fund, we consider
factors such as how much the stock's dividend has grown in the past, the
frequency of the stock's prior dividend increases, the company's potential for
strong positive cash flow, and the price/earnings ratio of the stock compared to
other stocks in the market. We avoid stocks that we think are overvalued. We
seek stocks that we believe have the potential for above-average dividend
growth.

How to use this glossary

Words found in the glossary are printed in boldface only the first time they
appear in the prospectus. So if you would like to know the meaning of a word
that isn't in boldface, you might still find it in the glossary.

GlossaryA-C

Amortized cost
- --------------------------------------------------------------------------------
Amortized cost is a method used to value a fixed income security that starts
with the face value of the security and then adds or subtracts from that value
depending on whether the purchase price was greater or less than the value of
the security at maturity. The amount greater or less than the par value is
divided equally over the time remaining until maturity.

Average maturity
- --------------------------------------------------------------------------------
An average of when the individual bonds and other debt securities held in a
portfolio will mature.

6
<PAGE>
The securities we
typically invest in

Stocks offer investors the potential for capital appreciation, and may pay
dividends as well. Fixed-income securities offer the potential for greater
income payments than stocks, and also may provide capital appreciation.

- --------------------------------------------------------------------------------
Securities
- --------------------------------------------------------------------------------
Common stocks: Securities that represent shares of ownership in a corporation.
Stockholders participate in the corporation's profits and losses, proportionate
to the number of shares they own.

Convertible securities: Usually preferred stocks or corporate bonds that can be
exchanged for a set number of shares of common stock at a predetermined price.
These securities offer higher appreciation potential than nonconvertible bonds
and greater income potential than nonconvertible preferred stocks.

Mortgage-backed securities: Fixed-income securities that represent pools of
mortgages, with investors receiving principal and interest payments as the
underlying mortgage loans are paid back. Many are issued and guaranteed against
default by the U.S. government or its agencies or instrumentalities, such as the
Federal Home Loan Mortgage Corporation, Fannie Mae and the Government National
Mortgage Association. Others are issued by private financial institutions, with
some fully collateralized by certificates issued or guaranteed by the government
or its agencies or instrumentalities.

Collateralized mortgage obligations (CMOs): Privately issued mortgage-backed
bonds whose underlying value is the mortgages that are grouped into different
pools according to their maturity.

Real estate mortgage investment conduits (REMICs): Privately issued
mortgage-backed bonds whose underlying value is a fixed pool of mortgages
secured by an interest in real property. Like CMOs, REMICs offer different
pools.
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
How we use them
- --------------------------------------------------------------------------------
Delaware Balanced Fund
- --------------------------------------------------------------------------------
Generally, we invest up to 75% of net assets in dividend-paying stocks.

Each Fund may invest in convertible securities; however, we will not invest
more than 5% of net assets in convertible securities that are rated below
investment grade by an NRSRO or in securities that are unrated but deemed
equivalent to non-investment grade.

There is no limit on government-related mortgage-backed securities or on
fully collateralized privately issued mortgage-backed securities.

We may invest up to 20% of net assets in mortgage-backed securities issued by
private companies whether or not the securities are 100% collateralized.
However, these securities must be rated at the time of purchase in one of the
four highest categories by an NRSRO. The privately issued securities we invest
in are either CMOs or REMICs (see below).

See mortgage-backed securities above.

- --------------------------------------------------------------------------------
Devon Fund
- --------------------------------------------------------------------------------
Generally, 90% to 100% of the Fund's assets will be invested in common
stocks. Under normal market conditions we will invest at least 65% of total
assets in dividend-paying stocks.

There is no limit on government-related mortgage-backed securities; however,
the Fund typically holds none or only a small percentage of its net assets in
fixed-income securities.

We may purchase privately issued obligations only if they are 100%
collateralized and rated in one of the four highest categories by an NRSRO. The
privately issued securities we would invest in would be either CMOs or REMICs
(see below).

See mortgage-backed securities above.

- --------------------------------------------------------------------------------
Bond
- --------------------------------------------------------------------------------
A debt security, like an IOU, issued by a company, municipality or government
agency. In return for lending money to the issuer, a bond buyer generally
receives fixed periodic interest payments and repayment of the loan amount on a
specified maturity date. A bond's price changes prior to maturity and is
inversely related to current interest rates. When interest rates rise, bond
prices fall, and when interest rates fall, bond prices rise. See also Nationally
recognized statistical rating organization.

Bond ratings
- --------------------------------------------------------------------------------
Independent evaluations of creditworthiness, ranging from Aaa/AAA (highest
quality) to D (lowest quality). Bonds rated Baa/BBB or better are considered
investment grade.

Capital
- --------------------------------------------------------------------------------
The amount of money you invest.

<PAGE>
How we manage the Funds (continued)

Securities we typically
invest in (continued)
- --------------------------------------------------------------------------------
Securities
- --------------------------------------------------------------------------------
Asset-backed securities: Bonds or notes backed by accounts receivables including
home equity, automobile or credit loans.

Corporate bonds: Debt obligations issued by a corporation.

Repurchase agreements: An agreement between a buyer and seller of securities in
which the seller agrees to buy the securities back within a specified time at
the same price the buyer paid for them, plus an amount equal to an agreed upon
interest rate. Repurchase agreements are often viewed as equivalent to cash.

American Depositary Receipts (ADRs): Certificates issued by a U.S. bank that
represent a stated number of shares of a foreign corporation that the bank holds
in its vault. An ADR entitles the holder to all dividends and capital gains
earned by the underlying foreign shares. An ADR is bought and sold the same as
U.S. securities.

Restricted securities: Privately placed securities whose resale is restricted
under securities law.

Illiquid securities: Securities that do not have a ready market, and cannot be
easily sold, if at all, at approximately the price that the Fund has valued
them.
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
How we use them
- --------------------------------------------------------------------------------
Delaware Balanced Fund
- --------------------------------------------------------------------------------
We invest only in asset-backed securities rated in one of the four highest
categories by an NRSRO.

We focus on bonds rated in one of the four highest categories by an NRSRO (or
deemed equivalent), with maturities between five and 30 years.

Typically, we use repurchase agreements as a short-term investment for a Fund's
cash position. In order to enter into these repurchase agreements, the Fund must
have collateral of at least 102% of the repurchase price. (Neither Fund may have
more than 10% of its total assets in repurchase agreements with maturities of
over seven days.)

We may invest without limitation in ADRs.

We may invest without limitation in privately placed securities that are
eligible for resale only among certain institutional buyers without
registration. These are commonly known as "Rule 144A Securities." Other
restricted securities must be limite d to 5% of total Fundassets.

We may invest up to 10% of total assets in illiquid securities.
- --------------------------------------------------------------------------------
Devon Fund
- --------------------------------------------------------------------------------
Devon Fund doesn't typically invest in asset-backed securities. When we do, we
are allowed to invest only in asset-backed securities rated in one of the four
highest categories by an NRSRO.

Although Devon is allowed to invest in corporate bonds, we do not typically
invest in them.

We may invest without limitation in ADRs.

We may invest up to 10% of total assets in illiquid securities.
- --------------------------------------------------------------------------------
The Funds may also invest in other securities including real estate investment
trusts, rights and warrants to purchase common stock, futures contracts,
options, U.S. Treasury securities, Yankee and Euro bonds. Please see the
Statement of Additional Information for additional descriptions on these
securities as well as those listed in the table above.

Lending securities Each Fund may lend up to 25% of its assets to qualified
brokers, dealers and investors for their use in security transactions.

Purchasing securities on a when-issued or delayed delivery basis Each Fund may
buy or sell securities on a when-issued or delayed delivery basis; that is,
paying for securities before delivery or taking delivery at a later date.

Portfolio turnover Both Funds anticipate that their annual portfolio turnover
will be less than 100%. A turnover rate of 100% would occur if a Fund sold and
replaced securities valued at 100% of its net assets within one year.

C-D

Capital appreciation
- --------------------------------------------------------------------------------
An increase in the value of an investment.

Capital gains distributions
- --------------------------------------------------------------------------------
Payments to mutual fund shareholders of profits (realized gains) from the sale
of a fund's portfolio securities. Usually paid once a year; may be either
short-term gains or long-term gains.

Compounding
- --------------------------------------------------------------------------------
Earnings on an investment's previous earnings.

Consumer Price Index (CPI)
- --------------------------------------------------------------------------------
Measurement of U.S. inflation; represents the price of a basket of commonly
purchased goods.

8
<PAGE>

The risks of investing
in the Funds

Investing in any mutual fund involves risk, including the risk that you may
receive little or no return on your investment, and the risk that you may lose
part or all of the money you invest. Before you invest in a Fund you should
carefully evaluate the risks. An investment in the Funds typically provides the
best results when held for a number of years. The following are the chief risks
you assume when investing in Delaware Balanced Fund or Devon Fund. Please see
the Statement of Additional Information for further discussion of these risks
and the other risks not discussed here.
- --------------------------------------------------------------------------------
Risks
- --------------------------------------------------------------------------------
Market risk is the risk that all or a majority of the securities in a certain
market--like the stock or bond market--will decline in value because of factors
such as economic conditions, future expectations or investor confidence.

Industry and security risk is the risk that the value of securities in a
particular industry or the value of an individual stock or bond will decline
because of changing expectations for the performance of that industry or for the
individual company issuing the stock or bond.

Interest rate risk is the risk that securities, particularly bonds with longer
maturities, will decrease in value if interest rates rise.

Foreign risk is the risk that foreign securities may be adversely affected by
political instability, changes in currency exchange rates, foreign economic
conditions or inadequate regulatory and accounting standards.

Liquidity risk is the possibility that securities cannot be readily sold, if at
all, at approximately the price that a Fund values them.
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
How we strive to manage them
- --------------------------------------------------------------------------------
Delaware Balanced Fund
- --------------------------------------------------------------------------------
We maintain a long-term investment approach and focus on stocks we believe can
appreciate over an extended time frame regardless of interim market
fluctuations. We do not try to predict overall stock market movements and do not
trade for short-term purposes.

We may hold a substantial part of each Fund's assets in cash or cash equivalents
as a temporary defensive strategy.

We diversify the Fund's assets among two major categories of investments--stocks
and bonds--which tend to increase and decline in value in different economic or
investment conditions.

We limit the amount of each Fund's assets invested in any one industry and in
any individual security. We also follow a rigorous selection process before
choosing securities for the portfolio.

Within Delaware Balanced Fund's fixed-income component, we do not try to
increase return by predicting and aggressively capitalizing on interest rate
moves. Instead, we aim to keep the interest rate risk similar to the Lehman
Brothers Aggregate Bond Index.

We typically invest only a small portion of each Fund's portfolio in foreign
securities. When we do purchase foreign securities, they are often denominated
in U.S. dollars. We also tend to avoid markets where we believe accounting
principles or the regulatory structure are underdeveloped.

We limit exposure to illiquid securities.
- --------------------------------------------------------------------------------
Devon Fund
- --------------------------------------------------------------------------------
We maintain a long-term investment approach and focus on stocks we believe can
appreciate over an extended time frame regardless of interim market
fluctuations. We do not try to predict overall stock market movements and do not
trade for short-term purposes.

We may hold a substantial part of each Fund's assets in cash or cash equivalents
as a temporary defensive strategy.

We limit the amount of each Fund's assets invested in any one industry and in
any individual security. We also follow a rigorous selection process before
choosing securities for the portfolio.

Devon does not generally hold a significant portion of assets in fixed-income
securities, so interest rate risk is not a major risk with this Fund.

We limit exposure to illiquid securities.
- --------------------------------------------------------------------------------
Corporate bond
- --------------------------------------------------------------------------------
A debt security issued by a corporation. See "bond."

Cost basis
- --------------------------------------------------------------------------------
The original purchase price of an investment, used in determining capital gains
and losses.

Depreciation
- --------------------------------------------------------------------------------
A decline in an investment's value.

Diversification
- --------------------------------------------------------------------------------
The process of spreading investments among a number of different securities,
asset classes or investment styles to reduce the risks of investing.

Dividend distribution
- --------------------------------------------------------------------------------
Payments to mutual fund shareholders of dividends passed along from the fund's
portfolio of securities.

9
<PAGE>
Investment
manager

The Funds are managed by Delaware Management Company, a series of Delaware
Management Business Trust which is an indirect, wholly owned subsidiary of
Delaware Management Holdings, Inc. Delaware Management Company makes investment
decisions for the Funds, manages the Funds' business affairs and provides daily
administrative services. For these services, the manager was paid a feefor the
last fiscal year as follows:

Investment Management Fees

Delaware Balanced Fund Devon Fund
- --------------------------------------------------------------------------------
As a percentage of average daily net assets 0.50% 0.60%
- --------------------------------------------------------------------------------

Portfolio
managers

George H. Burwell and Gary A. Reed have primary responsibility for making
day-to-day investment decisions for Delaware Balanced Fund. Mr. Burwell has
responsibility for making the day-to-day investment decisions for Devon Fund.
When making decisions for the Funds, Mr. Burwell regularly consults with Andrea
Giles and Christopher Driver.

George H. Burwell, CFA, holds a BA from the University of Virginia and is a
Chartered Financial Analyst (CFA). He has been Senior Portfolio Manager for
equities since 1992 when he joined Delaware Investments. Previously he worked
for Midlantic Bank in New Jersey where he managed an equity mutual fund and
three commingled funds.

Gary A. Reed holds an AB in Economics from the University of Chicago and an MA
in Economics from Columbia University. He has been Senior Portfolio Manager for
fixed income since 1989. Before joining Delaware Investments in 1989, Mr. Reed
was Vice President and Manager of the fixed-income department of the Irving
Trust Company in New York.

Andrea Giles, Research Analyst for the Fund, holds a BSAD from the
Massachusetts Institute of Technology and an MBA in Finance from Columbia
University. Prior to joining Delaware Investments in 1996, she was an account
officer in the Leveraged Capital Group with Citibank.

Christopher Driver, Research Analyst for the Fund, holds a BS in Finance from
the University of Delaware. Prior to joining Delaware Investments in 1998, he
was a Research Analyst in the Equity Value group at Blackrock, Inc. Prior to
Blackrock, he was a partner at Cashman Farrell & Associates. Mr. Driver is a CFA
charterholder.

D-I

Duration
- --------------------------------------------------------------------------------
A measurement of a fixed-income investment's price volatility. The larger the
number, the greater the likely price change for a given change in interest
rates.

Expense ratio
- --------------------------------------------------------------------------------
A mutual fund's total operating expenses, expressed as a percentage of its total
net assets. Operating expenses are the costs of running a mutual fund, including
management fees, offices, staff, equipment and expenses related to maintaining
the fund's portfolio of securities and distributing its shares. They are paid
from the fund's assets before any earnings are distributed to shareholders.

10
<PAGE>
Who's who?

This diagram shows the various organizations involved with managing,
administering, and servicing the Delaware Investments funds.

Board of Directors

The Funds

Investment manager
Delaware Management Company
One Commerce Square
Philadelphia, PA 19103

Portfolio managers
(see page 10 for details)

Distributor
Delaware Distributors, L.P.
1818 Market Street
Philadelphia, PA 19103

Service agent
Delaware Service Company, Inc.
1818 Market Street
Philadelphia, PA 19103

Custodian
The Chase Manhattan Bank
4 Chase Metrotech Center
Brooklyn, NY 11245
Shareholders

Board of directors A mutual fund is governed by a board of directors which has
oversight responsibility for the management of the fund's business affairs.
Directors establish procedures and oversee and review the performance of the
investment manager, the distributor and others that perform services for the
fund. At least 40% of the board of directors must be independent of the fund's
investment manager or distributor. These independent fund directors, in
particular, are advocates for shareholder interests.

Investment manager An investment manager is a company responsible for selecting
portfolio investments consistent with the objective and policies stated in the
mutual fund's prospectus. The investment manager places portfolio orders with
broker/dealers and is responsible for obtaining the best overall execution of
those orders. A written contract between a mutual fund and its investment
manager specifies the services the manager performs. Most management contracts
provide for the manager to receive an annual fee based on a percentage of the
fund's average daily net assets. The manager is subject to nu merous legal
restrictions, especially regarding transactions between itself and the funds
itadvises.

Portfolio managers Portfolio managers are employed by the investment manager to
make investment decisions for individual portfolios on a day-to-day basis.

Custodian Mutual funds are legally required to protect their portfolio
securities and typically place them with a qualified bank custodian who
segregates fund securities from other bank assets.

Distributor Most mutual funds continuously offer new shares to the public
through distributors who are regulated as broker-dealers and are subject to
National Association of Securities Dealers, Inc. (NASD) rules governing mutual
fund sales practices.

Service agent Mutual fund companies employ service agents (sometimes called
transfer agents) to maintain records of shareholder accounts, calculate and
disburse dividends and capital gains and prepare and mail shareholder statements
and tax information, among other functions. Many service agents also provide
customer service to shareholders.

Shareholders Like shareholders of other companies, mutual fund shareholders have
specific voting rights, including the right to elect directors. Material changes
in the terms of a fund's management contract must be approved by a shareholder
vote, and funds seeking to change fundamental investment objectives or policies
must also seek shareholderapproval.

<PAGE>

Financial adviser
- --------------------------------------------------------------------------------
Financial professional (e.g., broker, banker, accountant, planner or insurance
agent) who analyzes clients' finances and prepares personalized programs to meet
objectives.

Fixed-income securities
- --------------------------------------------------------------------------------
With fixed-income securities, the money you originally invested is paid back at
a pre-specified maturity date. These securities, which include government,
corporate or municipal bonds, as well as money market securities, typically pay
a fixed rate of return (often referred to as interest). See Bonds.

Government securities
- --------------------------------------------------------------------------------
Securities issued by U.S. government or its agencies. They include Treasuries as
well as agency-backed securities such as Fannie Maes.

Inflation
- --------------------------------------------------------------------------------
The increase in the cost of goods and services over time. U.S. inflation is
frequently measured by changes in the Consumer Price Index (CPI).

11
<PAGE>

Investing in
the Funds

Institutional Class shares are available for purchase only by the following:

o retirement plans introduced by persons not associated with brokers or
dealers that are primarily engaged in the retail securities business and
rollover individual retirement accounts from such plans

o tax-exempt employee benefit plans of the manager or its affiliates and
securities dealer firms with a selling agreement with the distributor

o institutional advisory accounts of the manager, or its affiliates and those
having client relationships with Delaware Investment Advisers, an affiliate
of the manager, or its affiliates and their corporate sponsors, as well as
subsidiaries and related employee benefit plans and rollover individual
retirement accounts from such institutional advisory accounts

o a bank, trust company and similar financial institution investing for its
own account or for the account of its trust customers for whom such
financial institution is exercising investment discretion in purchasing
shares of the Class, except where the investment is part of a program that
requires payment to the financial institution of a Rule 12b-1 Plan fee

o registered investment advisers investing on behalf of clients that consist
solely of institutions and high net-worth individuals having at least
$1,000,000 entrusted to the adviser for investment purposes, but only if the
adviser is not affiliated or associated with a broker or dealer and derives
compensation for its services exclusively from its clients for such advisory
services

I-N

Investment goal
- --------------------------------------------------------------------------------
The objective, such as long-term capital growth or high current income, that a
mutual fund pursues.

Lehman Brothers Aggregate Bond Index
- --------------------------------------------------------------------------------
An index that measures the performance of about 6,500 U.S. corporate and
government bonds.

Management fee
- --------------------------------------------------------------------------------
The amount paid by a mutual fund to the investment adviser for management
services, expressed as an annual percentage of the fund's average daily
netassets.

<PAGE>

How to buy shares

By mail

Complete an investment slip and mail it with your check, made payable to the
fund and class of shares you wish to purchase, to Delaware Investments, 1818
Market Street, Philadelphia, PA 19103-3682. If you are making an initial
purchase by mail, you mus t include a completed investment application (or an
appropriate retirement plan application if you are opening a retirement account)
with your check.

By wire

Ask your bank to wire the amount you want to invest to First Union Bank, ABA
#031201467, Bank Account number 2014128934013. Include your account number and
the name of the fund in which you want to invest. If you are making an initial
purchase by wire, you must call us at 800.510.4015 so we can assign you an
account number.

By exchange

You can exchange all or part of your investment in one or more funds in the
Delaware Investments family for shares of other funds in the family. Please keep
in mind, however, that you may not exchange your shares for Class B or Class C
shares. To open an account by exchange, call Client Services Representative at
800.510.4015.

Through your financial adviser

Your financial adviser can handle all the details of purchasing shares,
including opening an account. Your adviser may charge a separate fee for this
service.

Market capitalization
- --------------------------------------------------------------------------------
The value of a corporation determined by multiplying the current market price of
a share of common stock by the number of shares held by shareholders. A
corporation with one million shares outstanding and the market price per share
of $10 has a market capitalization of $10 million.

Maturity
- --------------------------------------------------------------------------------
The length of time until a bond issuer must repay the underlying loan principal
to bondholders.

National Association of Securities Dealers (NASD)
- --------------------------------------------------------------------------------
A self-regulating organization, consisting of brokerage firms (including
distributors of mutual funds), that is responsible for overseeing the actions of
its members.

13
<PAGE>

About your account (continued)

How to buy shares (continued)

The price you pay for shares will depend on when we receive your purchase order.
If we or an authorized agent receives your order before the close of trading on
the New York Stock Exchange (normally 4:00 p.m. Eastern Time) on a business day,
you will pay that day's closing share price which is based on the Fund's net
asset value. If we receive your order after the close of trading, you will pay
the next business day's price. A business day is any day that the New York Stock
Exchange is open for business. Currently, the Exchange is closed when the
following holidays are observed: New Year's Day, Martin Luther King, Jr.'s
Birthday, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor
Day, Thanksgiving and Christmas. We reserve the right to reject any purchase
order.

We determine the Funds' net asset value (NAV) per share at the close of trading
of the New York Stock Exchange each business day that the Exchange is open. We
calculate this value by adding the market value of all the securities and assets
in the Fund's portfolio, deducting all liabilities, and dividing the resulting
number by the number of shares outstanding. The result is the net asset value
per share. We price securities and other assets for which market quotations are
available at their market value. We price fixed-income securities on the basis
of valuations provided to us by an independent pricing service that uses methods
approved by the board of directors. Any fixed-income securities that have a
maturity of less than 60 days we price at amortized cost. We price all other
securities at their fair market value using a method approved by the board of
directors.

N-R

Nationally recognized statistical rating organization (NRSRO)
- --------------------------------------------------------------------------------
A company that assesses the credit quality of bonds, commercial paper, preferred
and common stocks and municipal short-term issues, rating the probability that
the issuer of the debt will meet the scheduled interest payments and repay the
principal. Ratings are published by such companies as Moody's Investors Service
(Moody's), Standard & Poor's Corporation (S&P), Duff & Phelps, Inc. (Duff), and
Fitch Investor Services, Inc. (Fitch).

Net asset value (NAV)
- --------------------------------------------------------------------------------
The daily dollar value of one mutual fund share. Equal to a fund's net assets
divided by the number of shares outstanding.

Preferred stock
- --------------------------------------------------------------------------------
Preferred stock has preference over common stock in the payment of dividends and
liquidation of assets. Preferred stocks also often pays dividends at a fixed
rate and is sometimes convertible into common stock.

<PAGE>

How to redeem shares

By mail

You can redeem your shares (sell them back to the fund) by mail by writing to:
Delaware Investments, 1818 Market Street, Philadelphia, PA 19103-3682. All
owners of the account must sign the request, and for redemptions of $50,000 or
more, you must include a signature guarantee for each owner. You can also fax
your written request to 215.255.8864. Signature guarantees are also required
when redemption proceeds are going to an address other than the address of
record on an account.

By telephone

You can redeem up to $50,000 of your shares by telephone. You may have the
proceeds sent to you by check, or, if you redeem at least $1,000 of shares, you
may have the proceeds sent directly to your bank by wire. Bank information must
be on file before you request a wire redemption.

By wire

You can redeem $1,000 or more of your shares and have the proceeds deposited
directly to your bank account the next business day after we receive your
request. Bank information must be on file before you request a wire redemption.

Through your financial adviser

Your financial adviser can handle all the details of redeeming your shares. Your
adviser may charge a separate fee for this service.

Price/earnings ratio
- --------------------------------------------------------------------------------
A measure of a stock's value calculated by dividing the current market price of
a share of stock by its annual earnings per share. A stock selling for $100 per
share with annual earnings per share of $5 has a P/E of 20.

Principal
- --------------------------------------------------------------------------------
Amount of money you invest (also called capital). Also refers to a bond's
original face value, due to be repaid at maturity.

Prospectus
- --------------------------------------------------------------------------------
The official offering document that describes a mutual fund, containing
information required by the SEC, such as investment objectives, policies,
services and fees.

Redeem
- --------------------------------------------------------------------------------
To cash in your shares byselling them back to the mutual fund.

Risk
- --------------------------------------------------------------------------------
Generally defined as variability of value; also credit risk, inflation risk,
currency and interest rate risk. Different investments involve different types
and degrees of risk.

15
<PAGE>

About your account (continued)

How to redeem shares
(continued)

If you hold your shares in certificates, you must submit the certificates with
your request to sell the shares. We recommend that you send your certificates by
certified mail.

When you send us a properly completed request to redeem or exchange shares, you
will receive the net asset value as determined on the business day we receive
your request. We will send you a check, normally the next business day, but no
later than seven days after we receive your request to sell your shares. If you
purchased your shares by check, we will wait until your check has cleared, which
can take up to 15 days, before we send your redemption proceeds.

Account minimum

If you redeem shares and your account balance falls below $250, the
Fund may redeem your account after 60 days' written notice to you.

Exchanges

You can exchange all or part of your shares for shares of the same class in
another Delaware Investments fund. If you exchange shares to a fund that has a
sales charge you will pay any applicable sales charges on your new shares. You
don't pay sales charges on shares that are acquired through the reinvestment of
dividends. You may have to pay taxes on your exchange. When you exchange shares,
you are purchasing shares in another fund so you should be sure to get a copy of
the fund's prospectus and read it carefully before buying shares through an
exchange. You may not exchange your shares for Class B and Class C shares of the
funds in the Delaware Investments family.

Dividends, distributions and taxes

For each Fund, dividends, if any, are paid quarterly, while any capital gains
are distributed annually. We automatically reinvest all dividends and any
capital gains, unless you tell us otherwise.

Tax laws are subject to change, so we urge you to consult your tax adviser about
your particular tax situation and how it might be affected by current tax law.
The tax status of your dividends from these Funds is the same whether you
reinvest your dividends or receive them in cash. Distributions from a Fund's
long-term capital gains are taxable as capital gains, while distributions from
short-term capital gains and net investment income are generally taxable as
ordinary income. Any capital gains may be taxable at different rates depending
on the length of time the Fund held the assets. In addition, you may be subject
to state and local taxes on distributions.

We will send you a statement each year by January 31 detailing the amount and
nature of all dividends and capital gains that you were paid for the prior year.

S-T

S&P 500 Index
- --------------------------------------------------------------------------------
The Standard & Poor's 500 Composite Stock Index; an unmanaged index of 500
widely held common stocks that is often used to represent performance of the
U.S. stock market.

Sales charge
- --------------------------------------------------------------------------------
Charge on the purchase or redemption of fund shares sold through financial
advisers. May vary with the amount invested. Typically used to compensate
advisers for advice and service provided.

SEC (Securities and Exchange Commission)
- --------------------------------------------------------------------------------
Federal agency established by Congress to administer the laws governing the
securities industry, including mutual fund companies.

Share classes
- --------------------------------------------------------------------------------
Different classifications of shares; mutual fund share classes offer a variety
of sales charge choices.

<PAGE>

Certain management considerations

Year 2000

As with other mutual funds, financial and business organizations and individuals
around the world, the Funds could be adversely affected if the computer systems
used by their service providers do not properly process and calculate
date-related information from and after January 1, 2000. This is commo nly known
as the "Year 2000 Problem." Each Fund is taking steps to obtain satisfactory
assurances that its major service providers are taking steps reasonably designed
to address the Year 2000 Problem on the computer systems that the service
providers use. However, there can be no assurance that these steps will be
sufficient to avoid any adverse impact on the business of the Funds.

EURO

Several European countries are participating in the European Economic and
Monetary Union, which will establish a common European currency for
participating countries. This currency will commonly be known as the "Euro." It
is anticipated that each such participating country will replace its existing
currency with the Euro on January 1, 1999. Additional European countries may
elect to participate after that date. If a Fund is invested in securities of
participating countries, it could be adversely affected if the computer systems
used by its major service providers are not properly prepared to handle the
implementation of this single currency or the adoption of the Euro by additional
countries in the future. The Funds are taking steps to obtain satisfactory
assurances that their major service providers are taking steps reasonably
designed to address these matters on the computer systems that the service
providers use. However, there can be no assurances that these steps will be
sufficient to avoid any adverse impact on the business of the Fund.

Investments by Fund of Funds

Devon Fund accepts investments from the series portfolios of Delaware Group
Foundation Funds, a fund of funds. From time to time, the Fund may experience
large investments or redemptions due to allocations or rebalancings by
Foundation Funds. While it is impossible to predict the overall impact of these
transactions over time, there could be adverse effects on portfolio management.
For example, the Fund may be required to sell securities or invest cash at times
when it would not otherwise do so. These transactions could also have tax
consequences if sales of securities result in gains, and could also increase
transactions costs or portfolio turnover. The manager will monitor transactions
by Foundation Funds and will attempt to minimize any adverse effects on both
Devon Fund and Foundation Funds as a result of these transactions.

Signature guarantee
- --------------------------------------------------------------------------------
Certification by a bank, brokerage firm or other financial institution that a
customer's signature is valid; signature guarantees can be provided by members
of the STAMP program.

Standard deviation
- --------------------------------------------------------------------------------
A measure of an investment's volatility; for mutual funds, measures how much a
fund's total return has typically varied from its historical average.

Statement of Additional Information (SAI)
- --------------------------------------------------------------------------------
The document serving as "Part B" of a fund's prospectus that provides more
detailed information about the fund's organization, investments, policies and
risks.

Stock
- --------------------------------------------------------------------------------
An investment that represents a share of ownership (equity) in a corporation.
Stocks are often referred to as "equities."

Total return
- --------------------------------------------------------------------------------
An investment performance measurement, expressed as a percentage, based on the
combined earnings from dividends, capital gains and change in price over a given
period.

17
<PAGE>
Financial information

Financial highlights
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
Year ended
10/31
Delaware Balanced Fund 1998 1997 1996 1995 1994
......................................................................................................................
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 23.000 $ 21.300 $ 19.980 $ 18.030 $19.460
Income From Investment Operations
Net investment income 0.585 0.659 0.727 0.694 0.653
Net realized & unrealized gains (losses) on investments 2.595 3.681 2.363 2.166 (0.293)
-------- -------- -------- -------- -------
Total from investment operations 3.180 4.340 3.090 2.860 0.360
-------- -------- -------- -------- -------
Less Dividends and Distributions
Dividends from net investment income (0.580) (0.720) (0.690) (0.660) (0.630)
Distributions from realized gain on investments (2.600) (1.920) (1.080) (0.250) (1.160)
-------- -------- -------- -------- -------
Total dividends and distributions (3.180) (2.640) (1.770) (0.910) (1.790)
-------- -------- -------- -------- -------
Net asset value, end of period $ 23.000 $ 23.000 $ 21.300 $ 19.980 $18.030
======== ======== ======== ======== =======
Total Return 15.03% 22.29% 16.25% 16.50% 1.96%
Ratios and Supplemental Data:
Net asset value, end of period (000's omitted) $300,656 $153,176 $125,751 $108,747 $93,990
Ratio of expenses to average net assets 0.77% 0.78% 0.80% 0.79% 0.81%
Ratio of net investment income to average net assets 2.46% 3.00% 3.58% 3.73% 3.47%
Portfolio turnover 86% 81% 92% 94% 142%
</TABLE>
Volatility
- --------------------------------------------------------------------------------
Volatility, as indicated byyear-by-year return
Volatility chart is not part of Financial highlights and has not been audited by
Ernst & Young LLP.
Year ended
10/31
1998 1997 1996 1995 1994
..............................................................................
15.03% 22.29% 16.25% 15.50% 1.96%

- ------------------------------------------------------------------------------

T-V

Treasury bills
- --------------------------------------------------------------------------------
Securities issued by the U.S. Treasury with maturities of one year or less.

Treasury bonds
- --------------------------------------------------------------------------------
Securities issued by the U.S. Treasury with maturities of 10 years or longer.

Treasury notes
- --------------------------------------------------------------------------------
Securities issued by the U.S. Treasury with maturities of one to 10 years.

Volatility
- --------------------------------------------------------------------------------
The tendency of an investment to go up or down in value by different magnitudes.
There are investments which are more likely to be "low volatility" and
investments which are more likely to be "high volatility" investments.

18
<PAGE>

How to read the Financial highlights

Net investment income
- --------------------------------------------------------------------------------
Net investment income includes dividend and interest income earned from the
Fund's securities; it is after expenses have been deducted.

Net realized and unrealized gains (losses) on investments
A realized gain occurs when we sell an investment at a profit, while a realized
loss occurs when we sell an investments at a loss. When an investment increases
or decreases in value but we do not sell it, we record an unrealized gain or
loss. The amount of realized gain per share that we pay to shareholders is
listed under "Less dividends and distributions-Distributions from realized gain
on investments."

Net asset value (NAV)
- --------------------------------------------------------------------------------
This is the value of a mutual fund share, calculated by dividing the net assets
by the number of shares outstanding.

Total return

This represents the rate that an investor would have earned or lost on an
investment in the Fund. In calculating this figure for the financial highlights
table, we include fee waivers, exclude front-end and contingent deferred sales
charges, and assume the shareholder has reinvested all dividends and realized
gains.

Net assets

Net assets represent the total value of all the assets in the Fund's portfolio,
less any liabilities, that are attributable to that class of the Fund.

(continues on page 21)

19
<PAGE>
Financial information (continued)

Financial highlights (continued)
- --------------------------------------------------------------------------------

The financial highlights table is intended to help you understand the Fund's
financial performance for the past five years. All "per share" information
reflects financial results for a single Fund share. This information has been
audited by Ernst & Young LLP, whose report, along with the Fund's financial
statements, is included in the Fund's annual report, which is available upon
request by calling 800.523.1918.
<TABLE>
<CAPTION>
Year ended
10/31 Period 12/29/93(1)
Devon Fund 1998 1997 1996 1995 through 10/31/94
............................................................................................................................
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $17.930 $14.670 $12.590 $10.860 $10.000
Income From Investment Operations
Net investment income 0.134 0.211 0.267 0.241(2) 0.201
Net realized & unrealized gains (losses) on investments 3.281 4.284 2.693 2.049 0.749
------- ------- ------- ------- -------
Total from investment operations 3.415 4.495 2.960 2.290 0.950
------- ------- ------- ------- -------
Less Dividends and Distributions
Dividends from net investment income (0.175) (0.270) (0.240) (0.240) (0.090)
Distributions from realized gain on investments (1.030) (0.965) (0.640) (0.320) none
------- ------- ------- ------- -------
Total dividends and distributions (1.205) (1.235) (0.880) (0.560) (0.090)
------- ------- ------- ------- -------
Net asset value, end of period $20,140 $17.930 $14.670 $12.590 $10.860
======= ======= ======= ======= =======
Total Return(3) 19.89% 32.57% 24.56% 22.26% 11.45%
Ratios and Supplemental Data:
Net assets, end of period (000's omitted) $10,482 $ 5,749 $ 3,290 $ 2,870 $ 2,516
Ratio of expenses to average net assets 1.00% 0.95% 0.95% 0.95% 0.95%
Ratio of expenses to average net assets prior to expense
limitation 1.10% 1.12% 1.54% 1.99% 2.96%
Ratio of net investment income to average net assets 0.94% 1.44% 1.97% 2.12% 2.26%
Ratio of net investment income to average net assets prior to
expense limitation 0.84% 1.27% 1.38% 1.08% 0.25%
Portfolio turnover 39% 64% 80% 99% 180%
</TABLE>

Volatility
- --------------------------------------------------------------------------------
Volatility, as indicated byyear-by-year return
Volatility chart is not part of Financial highlights and has not been audited by
Ernst & Young LLP.

Year ended
10/31 12/29/93(1)
1998 1997 1996 1995 through 10/31/94
...............................................................................

19.89% 32.57% 24.56% 22.26% 11.45%
- -------------------------------------------------------------------------------

(1) Date of initial sale; ratios and total return have been annualized.
(2) 1995 per share information was based on the average shares outstanding
method.
(3) Total return reflects the expense limitation referenced in Devon Fund's
Profile.

20
<PAGE>

How to read the Financial highlights (begins on page 19)

Ratio of expenses to average daily net assets
- --------------------------------------------------------------------------------
The expense ratio is the percentage of net assets that a fund pays annually for
operating expenses and management fees. These expenses include accounting and
administration expenses, services for shareholders, and similar expenses.

Ratio of net investment income to average daily net assets
We determine this ratio by dividing net investment income by average net assets.

Portfolio turnover rate
- --------------------------------------------------------------------------------
This figure tells you the amount of trading activity in a fund's portfolio. For
example, a fund with a 50% turnover has bought and sold half of the value of its
total investment portfolio during the stated period.

<PAGE>
Delaware
Balanced Fund

Devon Fund

Additional information about the Funds' investments is available in the Funds'
annual and semi-annual reports to shareholders. In the Funds' shareholder
reports, you will find a discussion of the market conditions and investment
strategies that significantly affected the Funds' performance during the re port
period. You can find more detailed information about the Funds in the current
Statement of Additional Information, which we have filed electronically with the
Securities and Exchange Commission (SEC) and which is legally a part of this
prospectus. If you want a free copy of the Statement of Additional Information,
the annual or semi-annual report, or if you have any questions about investing
in these funds, you can write to us at 1818 Market Street, Philadelphia, PA
19103-3682, or call toll-free 800.523.1918. You may also obtain additional
information about the Funds from your financial adviser.

You can find reports and other information about the Funds on the SEC web site
(http://www.sec.gov), or you can get copies of this information, after payment
of a duplicating fee, by writing to the Public Reference Section of the SEC,
Washington, D.C. 20549-6009. Information about the Funds, including their
Statement of Additional Information, can be reviewed and copied at the
Securities and Exchange Commission's Public Reference Room in Washington, D.C.
You can get information on the public reference room by calling the SEC at
1.800.SEC.0330.

Web site
www.delawarefunds.com

E-mail
[email protected]

Client Services Representative
800.510.4015

Delaphone Service
800.362.FUND (800.362.3863)

o For convenient access to account information or current performance
information on all Delaware Investments Funds seven days a week, 24 hours a
day, use this Touch-Tone (R)service.

DELAWARE
INVESTMENTS
- ---------------------
PHILADELPHIA * LONDON

Registrant's Investment Company Act file number: 811-249

P+ 042 [++] PP 1/99