<PAGE>
THE DREYFUS FUND INC.
ANNUAL REPORT
1993
<PAGE>
DIRECTORS
Daniel C. Maclean
Secretary
Howard Stein
Chairman of the Board
John J. Pyburn
Treasurer
Lucy Wilson Benson
Robert F. Dubuss
David Burke
Assistant Treasurer
Martin D. Fife
Paul R. Casti, Jr.
Controller
Whitney I. Gerard
Robert I. Frenkel
Robert R. Glauber
Assistant Secretary
Arthur A. Hartman
Christine Pavalos
George L. Perry
Assistant Secretary
Paul Wolfowitz
Joseph S. DiMartino
Investment Officer
Wolodymyr Wronskyj
Lawrence M. Greene
Investment Officer
OFFICERS
Howard Stein
Chairman & Investment
Officer
Wolodymyr Wronskyj
President &
Investment Officer
Jeffrey N. Nachman
Vice President -- Financial
Mark N. Jacobs
Vice President
CUSTODIAN
The Bank of New York
110 Washington Street
New York, N.Y. 10286
AUDITORS
Ernst & Young
787 Seventh Avenue
New York, N.Y. 10019
COUNSEL
Stroock & Stroock & Lavan
7 Hanover Square, New York, N.Y. 10004
MANAGER
The Dreyfus Corporation
200 Park Avenue
New York, N.Y. 10166
UNDERWRITER
Dreyfus Service Corporation
200 Park Avenue
New York, N.Y. 10166
Further information is contained in the Prospectus which must precede or
accompany this report.
<PAGE>
COMMON STOCK
PURCHASES AND SALES
six months ended December 31, 1993
PURCHASES(1)
NEW COMMITMENTS:
Advanced Micro Devices, Chemical Banking, First Chicago, Galen Partners
II L.P. (Units), Intel, Masco, Primerica, Sun Microsystems, TRW, Union Texas
Petroleum, Varity, Wells Fargo and Whirlpool.
ADDITIONS:
Canadian Gas Gathering Systems Cl. A, Chrysler, First Union, GE
Investment Private Placement Partners I L.P. (Units), Mead and SGK Equity Fund
L.P. (Units).
SALES
REDUCTIONS:
MCI Communications, Philip Morris, Seagram and Yorktown Energy Partners
L.P. (Units).
ELIMINATIONS:
Anheuser-Busch, Baxter International, Dillard Department Stores Cl. A,
duPont (E.I.) de Nemours, K mart, NIKE Cl. B, Reebok International, Triton
Energy, V. F., Weyerhaeuser and Woolworth Corp.
(1) Not shown are increases resulting from stock dividends and splits.
<PAGE>
- --------------------------------------------------------------------------------
LETTER TO SHAREHOLDERS
Dear Shareholder:
The results of The Dreyfus Fund showed clear improvement in the second half of
the latest fiscal year compared to the first half.
During the most recent quarter, the three months ended December 31, 1993, the
total return of the Fund was 3.82%,* which compares with 2.32% for the Standard
& Poor's 500 Composite Stock Price Index.**
For the six months ended December 31, 1993, your Fund's total return was
6.26%, compared to 4.95% for the Standard & Poor's 500.
This improvement however was not sufficient to beat the Standard & Poor's 500
for the full year. The Dreyfus Fund's total return for the twelve months ended
December 31, 1993 was 6.36%, compared to 10.06% for the Standard & Poor's 500.
Comparisons with the Dow Jones Industrial Average, which is more weighted
toward cyclical stocks where value already reflects future earnings recovery,
are less favorable. The Dow Jones Industrial Average gained 6.32% in the year's
final quarter, 8.24% for the second half and 16.97% for the full twelve
months.**
As was discussed in our semi-annual report, the first half of the year was
impacted by the sharp decline in tobacco stocks and other consumer-related
securities. These included a number of consumer companies with well-known brand
names such as Philip Morris, Colgate-Palmolive, PepsiCo, Gillette and
Kimberly-Clark, which were affected by concern over competition from private
label products. Also, earlier in the year, consumer-oriented stocks were held
back by slow retail sales.
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
As tobacco stocks recovered during the second half of the year, we
substantially reduced our investment in Philip Morris. We also sold holdings in
other companies whose outlook for earnings growth in the intermediate term
appears limited.
In refocusing the portfolio in recent months, we have been emphasizing
investments in companies which have shown improving demand for their products,
growth in market share and good cost controls. New acquisitions have included
Varity, TRW, Masco and Whirlpool.
Top holdings of the Fund now include Chrysler, which has benefitted from the
strong demand for cars and trucks as well as from introduction of new vehicles;
and Conrail, which has improved its cost structure and is sharing in the revival
of freight activity. Also, several of our holdings in consumer-goods companies,
which lost ground earlier in the year, have since recovered.
A complete list of the Fund's holdings at year-end, and a list of its top ten
positions, appear in later pages of this Annual Report.
The current environment for the Fund's operations includes a U.S. economy that
is growing at a faster rate than other industrialized countries. The
competitiveness of American companies is improving because of cost reduction
efforts. This should have a favorable impact on long-term corporate
profitability.
Once international growth accelerates, companies with operations abroad should
do better. We are trying to take advantage of these trends when making our
investment decisions.
Very truly yours,
Wolodymyr Wronskyj
President
January 19, 1994
New York, N.Y.
*Total return represents the change during the period in a hypothetical
account with dividends reinvested.
**SOURCE: LIPPER ANALYTICAL SERVICES, INC. - Reflects the reinvestment of income
dividends and, where applicable, capital gain distributions. Both the Dow
Jones Industrial Average and the Standard & Poor's 500 Composite Stock Price
Index are widely accepted unmanaged indexes of stock market performance.
- --------------------------------------------------------------------------------
<PAGE>
THE DREYFUS FUND INCORPORATED December 31, 1993
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN THE DREYFUS FUND
INCORPORATED
AND THE STANDARD & POOR'S 500 COMPOSITE STOCK PRICE INDEX
[GRAPH]
$1,323,210
The Dreyfus Fund
$1,014,758
Standard & Poor's 500
Composite Stock
Price Index*
Past performance is not predictive of future performance.
Although the Fund commenced operations on 5/24/51, the Standard & Poor's 500
Composite Stock Price Index was available only beginning 12/31/51. Accordingly,
the above illustration compares a $10,000 investment in The Dreyfus Fund on
12/31/51 to a $10,000 investment made in the Standard & Poor's 500 Composite
Stock Price Index on that date. All dividends and capital gain distributions are
reinvested.
The Fund's performance takes into account all applicable fees and expenses. The
Standard & Poor's 500 Composite Stock Price Index is a widely accepted,
unmanaged index of overall stock market performance and does not take into
account charges, fees and other expenses. Further information relating to Fund
performance is contained in the Condensed Financial Information section of the
Prospectus and elsewhere in this report.
*Source: Ibbotson Associates
<PAGE>
THE DREYFUS FUND INCORPORATED December 31, 1993
BROAD SECTOR ALLOCATION*
[CHART]
Sector allocations in the pie chart are broader groupings than are listed in the
Report's Statement of Investments. Portfolio composition is subject to change at
any time.
ASSET ALLOCATION*
<TABLE>
<S> <C>
Common Stocks... 85.5%
Convertible Preferred Stock... 0.2
Call Options... 0.6
Corporate Bonds... 0.3
Cash Equivalents... 13.4
-----
100.0%
</TABLE>
TEN LARGEST EQUITY HOLDINGS*
<TABLE>
<S> <C>
Chrysler........................... 2.8%
Conrail............................ 2.7
Colgate-Palmolive.................. 2.6
PepsiCo............................ 2.2
Lowe's............................. 2.1
General Electric................... 2.0
McDonald's......................... 2.0
Procter & Gamble................... 2.0
Philip Morris...................... 2.0
AMBAC.............................. 1.8
</TABLE>
* As a percentage of Total Net Assets.
COMMON STOCK PURCHASES AND SALES
six months ended December 31, 1993
PURCHASES (1)
New Commitments:
Advanced Micro Devices, Chemical Banking, First Chicago, Galen Partners
II L.P. (Units), Intel, Masco, Primerica, Sun Microsystems, TRW, Union Texas
Petroleum, Varity, Wells Fargo and Whirlpool.
Additions:
Canadian Gas Gathering Systems Cl. A, Chrysler, First Union,
GE Investment Private Placement Partners I L.P. (Units), Mead and SGK Equity
Fund L.P. (Units).
SALES
Reductions:
MCI Communications, Phillip Morris, Seagram and Yorktown Energy
Partners L.P. (Units).
Eliminations:
Anheuser-Busch, Baxter International, Dillard Department Stores Cl. A,
duPont (e.I.) de Nemours, K mart, NIKE Cl. B, Reebok International, Triton
Energy, V.F.; Weyerhaeuser and Woolworth Corp.
(1) Not shown are increases resulting from stock dividends and splits.
<PAGE>
THE DREYFUS FUND INCORPORATED
STATEMENT OF INVESTMENTS December 31, 1993
<TABLE>
<CAPTION>
COMMON STOCKS--85.5% SHARES VALUE
------------ --------------
<C> <S> <C> <C>
BASIC INDUSTRIES--2.5% Kimberly-Clark............................. 600,000 $ 31,125,000
Mead....................................... 500,000 22,500,000
SGK Equity Fund, L.P. (Units).............. 15.982(e) 15,896,064
--------------
69,521,064
--------------
CAPITAL GOODS--3.7% Eaton...................................... 500,000 25,250,000
General Electric........................... 545,000 57,156,875
Varity..................................... 500,000(a) 22,375,000
--------------
104,781,875
--------------
CONGLOMERATES--3.0% Dial....................................... 1,000,000 40,375,000
ITT........................................ 500,000 45,625,000
--------------
86,000,000
--------------
CONSUMER CYCLICAL--12.8% Chrysler................................... 1,500,000 79,875,000
Dana....................................... 500,000 29,937,500
Eastman Kodak.............................. 750,000 42,000,000
Ford Motor................................. 800,000 51,600,000
Fruit of The Loom, Cl. A................... 700,000(a) 16,887,500
Goodyear Tire & Rubber..................... 600,000 27,450,000
Penney (J.C.).............................. 400,000 20,950,000
Polaroid................................... 600,000 20,250,000
Sears, Roebuck............................. 700,000 36,925,000
Wal-Mart Stores............................ 500,000 12,500,000
Whirlpool.................................. 400,000 26,600,000
--------------
364,975,000
--------------
CONSUMER GROWTH STAPLES--9.1% Caremark International..................... 250,000 4,906,250
Galen Partners II, L.P. (Units)............ 2.086(e) 2,086,224
Gillette................................... 800,000 47,700,000
Mattel..................................... 1,000,000 27,625,000
McDonald's................................. 1,000,000 57,000,000
PepsiCo.................................... 1,525,000 62,334,375
Roche Holdings A.D.S....................... 1,140,000(b) 48,307,500
Toys R Us.................................. 250,000(a) 10,218,750
--------------
260,178,099
--------------
CONSUMER STAPLES--14.4% American Brands............................ 800,000 26,600,000
Campbell Soup.............................. 595,000 24,395,000
Clorox..................................... 300,000 16,275,000
Colgate-Palmolive.......................... 1,176,000 73,353,000
ConAgra.................................... 500,000 13,187,500
CPC International.......................... 801,000 38,147,625
General Mills.............................. 600,000 36,450,000
Melville................................... 500,000 20,312,500
Philip Morris.............................. 1,000,000 55,750,000
Procter & Gamble........................... 1,000,000 57,000,000
RJR Nabisco Holdings....................... 3,012,400(a) 19,204,050
Seagram.................................... 1,133,200 29,604,850
--------------
410,279,525
--------------
<PAGE>
</TABLE>
THE DREYFUS FUND INCORPORATED
STATEMENT OF INVESTMENTS (CONTINUED) December 31, 1993
<TABLE>
<CAPTION>
COMMON STOCKS (CONTINUED) SHARES VALUE
------------ --------------
<C> <S> <C> <C>
CREDIT CYCLICAL--3.5% Centex..................................... 460,000 $ 19,320,000
Lowe's..................................... 1,000,000 59,250,000
Masco...................................... 600,000 22,200,000
--------------
100,770,000
--------------
ENERGY--1.1% Canadian Gas Gathering Systems, Cl. A...... 244,511(e) 2,445,110
GE Investment Private Placement
Partners I, L.P. (Units)........... 12.357(e) 12,363,142
Union Texas Petroleum...................... 500,000 10,187,500
Yorktown Energy Partners, L.P. (Units)..... 6.357(e) 6,419,841
--------------
31,415,593
--------------
FINANCIAL--18.0% AMBAC...................................... 1,250,000 52,500,000
Banc One................................... 349,463 13,672,769
Bank of New York........................... 800,000 45,600,000
Bankers Trust New York..................... 203,700 16,117,763
Chase Manhattan (Warrants)................. 11,772(a) 95,647
Chemical Banking........................... 500,000 20,062,500
Continental Bank........................... 800,000 21,100,000
Dean-Witter, Discover...................... 373,217 12,922,639
EXEL Limited............................... 493,000 21,876,875
First Chicago.............................. 400,000 17,300,000
First Data................................. 800,000 32,600,000
First Financial Management................. 500,000 28,375,000
First Union................................ 500,000 20,625,000
GFC Financial.............................. 650,000 18,850,000
MBNA....................................... 1,500,000 50,062,500
Mellon Bank................................ 983,100 52,104,300
NationsBank................................ 500,000 24,500,000
Primerica.................................. 666,666 25,916,667
Shawmut National........................... 600,000 13,050,000
Wells Fargo................................ 200,000 25,875,000
--------------
513,206,660
--------------
TECHNOLOGY--6.7% Advanced Micro Devices..................... 500,000(a) 8,875,000
Hewlett-Packard............................ 600,000 47,400,000
Intel...................................... 500,000 31,000,000
MCI Communications......................... 1,025,000 28,956,250
Sprint..................................... 950,000 33,012,500
Sun Microsystems........................... 500,000(a) 14,562,500
TRW........................................ 400,000 27,700,000
--------------
191,506,250
--------------
TRANSPORTATION--9.4% Burlington Northern........................ 700,000 40,512,500
CSX........................................ 600,000 48,600,000
Conrail.................................... 1,140,000 76,237,500
Illinois Central........................... 1,000,000 35,875,000
Norfolk Southern........................... 500,000 35,250,000
Union Pacific.............................. 500,000 31,312,500
--------------
267,787,500
--------------
<PAGE>
</TABLE>
THE DREYFUS FUND INCORPORATED
STATEMENT OF INVESTMENTS (CONTINUED) December 31, 1993
<TABLE>
<CAPTION>
COMMON STOCKS (CONTINUED) SHARES VALUE
------------ --------------
<C> <S> <C> <C>
UTILITIES--1.3% American Telephone & Telegraph............. 700,000 $ 36,750,000
--------------
TOTAL COMMON STOCKS
(cost $1,752,459,350).............. $2,437,171,566
--------------
--------------
CONVERTIBILE PREFERRED
STOCK--.2%
USF&G, Ser. B, Cum., $10.25
(cost $4,925,000).................. 50,000(e) $ 7,053,008
--------------
--------------
<CAPTION>
PRINCIPAL
AMOUNT
SUBJECT TO
CALL
------------
<C> <S> <C> <C>
CALL OPTIONS--.6% Bundesobligationen;
6 5/8%, 1/20/1998, April '94 @
$58.42.............................. $ 8,625,647(c,e) $ 360,552
Bundesrepublik Deutschland:
6 1/2%, 7/15/2003, October '94 @
$59.15.............................. 189,764,232(c,e) 5,522,139
6 1/2%, 7/15/2003, October '94 @
$59.96.............................. 94,882,116(c,e) 1,527,602
6%, 9/15/2003, June '94 @ $58.68... 97,757,332(c,e) 2,140,886
Obligations Assimilables du Tresor;
6 3/4%, 10/25/2003, June '94 @
$18.04.............................. 98,022,647(d,e) 2,411,357
<CAPTION>
CONTRACTS
SUBJECT TO
CALL
------------
<C> <S> <C> <C>
German Stocks Bank Baskets:
October '94 @ $2,510.06............ 7,450(c,e) 1,884,991
October '94 @ $2,497.99............ 5,650(c,e) 1,494,538
October '94 @ $2,484.19............ 5,640(c,e) 1,540,538
--------------
TOTAL CALL OPTIONS
(cost $12,363,018)................. $ 16,882,603
--------------
--------------
<CAPTION>
PRINCIPAL
AMOUNT
------------
<C> <S> <C> <C>
CORPORATE BONDS--.3% Canadian Gas Gathering Systems:
14%, 8/29/2005..................... $ 187,500(e) $ 187,500
14%, 10/31/2005.................... 187,500(e) 187,500
14%, 7/24/2006..................... 531,633(e) 531,633
14%, 12/10/2006.................... 2,184,406(e) 2,184,406
14%, 4/8/2007...................... 549,478(e) 549,478
14%, 11/17/2007.................... 1,683,276(e) 1,683,276
14%, 6/30/2008..................... 1,930,747(e) 1,930,747
14%, 12/29/2008.................... 112,831(e) 112,831
--------------
TOTAL CORPORATE BONDS
(cost $7,367,371).................. $ 7,367,371
--------------
--------------
SHORT-TERM INVESTMENTS--13.3%
TIME DEPOSITS--3.7% Republic National Bank of New York (London)
2 3/8%, 1/3/94..................... $104,000,000 $ 104,000,000
--------------
REPURCHASE AGREEMENT--3.5% Kidder Peabody & Co.,
2 1/2%, (collateralized by U.S.
Treasury Bills
due 11/17/94 and U.S. Treasury
Notes 4 1/4% due 7/31/94)........... 100,000,000 100,000,000
--------------
<PAGE>
</TABLE>
THE DREYFUS FUND INCORPORATED
STATEMENT OF INVESTMENTS (CONTINUED) December 31, 1993
<TABLE>
<CAPTION>
PRINCIPAL
SHORT-TERM INVESTMENTS (CONTINUED) AMOUNT VALUE
------------ --------------
<C> <S> <C> <C>
U.S. GOVERNMENT AGENCY--6.1% U.S. Treasury Bill;
3.12%, 3/3/94...................... $175,000,000 $ 174,077,799
--------------
TOTAL SHORT-TERM INVESTMENTS
(cost $378,077,799)................ $ 378,077,799
--------------
--------------
TOTAL INVESTMENTS (cost $2,155,192,538)....................................... 99.9% $2,846,552,347
------- --------------
------- --------------
CASH AND RECEIVABLES (NET).................................................... .1% $ 3,970,758
------- --------------
------- --------------
NET ASSETS.................................................................... 100.0% $2,850,523,105
------- --------------
------- --------------
<FN>
NOTES TO STATEMENT OF INVESTMENTS:
(a) Non-income producing.
(b) Security exempt from registration under Rule 144A of the Securities Act
of 1933. This security may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the year
end, this security amounted to 1.69% of net assets.
(c) Denominated in Deutsche Marks.
(d) Denominated in French Francs.
(e) Securities restricted as to public resale. Investments in restricted
securities with an aggregate market value of $70,513,363, represent
approximately 2.47% of net assets:
</TABLE>
<TABLE>
<CAPTION>
ACQUISITION PURCHASE PERCENTAGE OF
ISSUER DATE PRICE* NET ASSETS VALUATION+
<S> <C> <C> <C> <C> <C>
___________ ---------------------- ------------- ------------- -------------------------
Bundesobligationen;
6 5/8%, 1/20/1998,
April '94 @ $58.42 4/27/93 $ .89 .01% $ 2.40
Bundesrepublik Deutschland:
6 1/2%, 7/15/2003,
October '94 @ $59.15 10/4/93 1.05 .19 1.67
6 1/2%, 7/15/2003,
October '94 @ $59.96 10/26/93 .89 .05 0.93
6%, 9/15/2003,
June '94 @ $58.68 12/13/93 .74 .07 1.26
Canadian Gas Gathering
Systems, Cl. A 8/29/90 - 12/29/93 10.00 .09 10.00 per share
Canadian Gas
Gathering Systems 14%:
8/29/2005 - 12/29/2008 8/29/90 - 12/29/93 100.00 .27 par
German Stocks Bank Baskets:
October '94 @ $2,510.06 10/20/93 233.05 .07 253.02
October '94 @ $2,497.99 10/19/93 233.17 .05 264.52
October '94 @ $2,484.19 10/18/93 233.15 .05 273.15
GE Investment
Private Placement
Partners I, L.P. (Units) 5/28/91 - 10/14/93 1,000,497.05 .43 1,000,497.05 per unit
Galen Partners II, L.P.
(Units) 12/8/93 1,000,107.38 .07 1,000,107.38 per unit
Obligations Assimilables du Tresor;
6 3/4%, 10/25/2003,
June '94 @ $18.04 12/13/93 .29 .08 0.42
</TABLE>
<PAGE>
THE DREYFUS FUND INCORPORATED
STATEMENT OF INVESTMENTS (CONTINUED) December 31, 1993
<TABLE>
<CAPTION>
ACQUISITION PURCHASE PERCENTAGE OF
ISSUER DATE PRICE* NET ASSETS VALUATION+
____________ ---------------------- ------------- ------------- -------------------------
<S> <C> <C> <C> <C> <C>
SGK Equity Fund, L.P.
(Units) 12/16/92 - 9/17/93 $ 994,622.95 .56% $ 994,622.95 per unit
USF&G, Ser. B, Cum. $10.25 6/3/91 98.50 .25 141.06 per share
Yorktown Energy
Partners, L.P.
(Units) 3/25/91 - 4/26/93 1,003,100.16 .23 1,003,100.16 per unit
<FN>
*Average cost.
+The valuation of these securities has been determined in good faith under the
direction of the Board of Directors.
</TABLE>
- ------------------------------------------------------------------------
Subject to certain limitations, the Fund has commitments to invest in the
securities and limited partnerships listed below:
<TABLE>
<CAPTION>
PORTION OF COMMITTED
ISSUER AMOUNTS UNINVESTED
<S> <C>
_____________ --------------------
Canadian Gas Gathering Systems $ 150,441
GE Investment Private Placement Partners I, L.P. (Units) 7,636,858
Galen Partners II, L.P. (Units) 2,913,776
SGK Equity Fund, L.P. (Units) 34,103,936
Yorktown Energy Partners, L.P. (Units) 3,580,159
</TABLE>
See notes to financial statements.
<PAGE>
THE DREYFUS FUND INCORPORATED
STATEMENT OF
ASSETS AND LIABILITIES
December 31, 1993
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ASSETS:
<S> <C> <C>
Investments in securities, at value
(cost $2,155,192,538)--see statement........... $2,846,552,347
Cash.................................................... 718,585
Receivable for investment securities sold............... 17,105,104
Dividends and interest receivable....................... 6,905,025
Receivable for subscriptions to Capital Stock........... 1,955,872
Net unrealized appreciation on forward currency exchange
contracts--Note 3(a)........................... 718,706
Prepaid expenses and other assets....................... 832,907
--------------
2,874,788,546
LIABILITIES:
Due to The Dreyfus Corporation.......................... $ 1,521,705
Payable for Capital Stock redeemed...................... 21,869,371
Accrued expenses........................................ 874,365 24,265,441
----------- --------------
NET ASSETS....................................................... $2,850,523,105
--------------
--------------
REPRESENTED BY:
Paid-in capital......................................... $2,150,438,114
Accumulated undistributed net realized gain on
investments........................................... 8,006,476
Accumulated net unrealized appreciation on
investments--Note 3(b)................................ 692,078,515
--------------
NET ASSETS at value applicable to 217,618,081 shares outstanding
(300 million shares of $1 par value Capital Stock
authorized)........................................... $2,850,523,105
--------------
--------------
NET ASSET VALUE, offering and redemption price per share
($2,850,523,105 / 217,618,081 shares)................... $13.10
------
------
</TABLE>
- --------------------------------------------------------------------------------
See notes to financial statements.
<PAGE>
THE DREYFUS FUND INCORPORATED
STATEMENT OF
OPERATIONS
Year ended December 31, 1993
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INVESTMENT INCOME:
<S> <C> <C>
INCOME:
Cash dividends (net of $238,306 foreign taxes
withheld at source)............................ $ 55,534,225
Interest....................................... 16,374,430
------------
TOTAL INCOME................................ $ 71,908,655
EXPENSES:
Management fee--Note 2(a)...................... 18,514,648
Shareholder servicing costs.................... 2,758,054
Prospectus and shareholders' reports........... 263,006
Custodian fees................................. 223,884
Professional fees.............................. 185,829
Directors' fees and expenses--Note 2(b)........ 51,215
Registration fees.............................. 42,238
Miscellaneous.................................. 27,780
------------
TOTAL EXPENSES............................... 22,066,654
------------
INVESTMENT INCOME--NET....................... 49,842,001
------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments--Note 3(a)............. $132,872,635
Net realized gain on forward currency exchange
contracts--Note 3(a); Short transactions.............. 1,367,394
------------
NET REALIZED GAIN............................ 134,240,029
Net unrealized appreciation on investments and forward
currency exchange contracts........................... 12,667,571
------------
NET REALIZED AND UNREALIZED GAIN ON
INVESTMENTS................................ 146,907,600
------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS............. $196,749,601
------------
------------
</TABLE>
- --------------------------------------------------------------------------------
See notes to financial statements.
<PAGE>
THE DREYFUS FUND INCORPORATED
STATEMENT OF
CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------------------
1992 1993
--------------- ---------------
<S> <C> <C>
OPERATIONS:
Investment income--net............................. $ 59,563,508 $ 49,842,001
Net realized gain on investments................... 101,846,699 134,240,029
Net unrealized appreciation (depreciation) on
investments for the year......................... (1,467,412) 12,667,571
--------------- ---------------
NET INCREASE IN NET ASSETS RESULTING FROM
OPERATIONS.................................... 159,942,795 196,749,601
--------------- ---------------
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income--net............................. (51,433,224) (63,624,901)
Excess investment income--net...................... -- (6,130,584)
Net realized gain on investments................... (73,934,421) (140,044,515)
--------------- ---------------
TOTAL DIVIDENDS........................... (125,367,645) (209,800,000)
--------------- ---------------
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold...................... 9,435,773,801 12,798,442,290
Dividends reinvested............................... 108,691,981 181,237,341
Cost of shares redeemed............................ (9,426,845,870) (13,264,963,957)
--------------- ---------------
INCREASE (DECREASE) IN NET ASSETS FROM
CAPITAL STOCK TRANSACTIONS.............. 117,619,912 (285,284,326)
--------------- ---------------
TOTAL INCREASE (DECREASE) IN NET ASSETS... 152,195,062 (298,334,725)
NET ASSETS:
Beginning of year.................................. 2,996,662,768 3,148,857,830
--------------- ---------------
End of year (including undistributed investment
income--net; $13,782,900 in 1992)................ $ 3,148,857,830 $ 2,850,523,105
--------------- ---------------
--------------- ---------------
<CAPTION>
SHARES SHARES
<S> <C> <C>
--------------- ---------------
CAPITAL SHARE TRANSACTIONS:
Shares sold........................................ 728,486,540 965,802,077
Shares issued for dividends reinvested............. 8,319,610 13,953,428
Shares redeemed.................................... (727,707,146) (999,357,279)
--------------- ---------------
NET INCREASE (DECREASE) IN SHARES
OUTSTANDING............................. 9,099,004 (19,601,774)
--------------- ---------------
--------------- ---------------
</TABLE>
- --------------------------------------------------------------------------------
See notes to financial statements.
<PAGE>
THE DREYFUS FUND INCORPORATED
FINANCIAL
HIGHLIGHTS
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share of
Capital Stock outstanding, total investment return, ratios to average net assets
and other supplemental data for each year indicated. This information has been
derived from information provided in the Fund's financial statements.
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------------------------------------
1989 1990 1991 1992 1993
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value, beginning
of year.................. $10.55 $12.07 $10.80 $13.14 $13.27
------ ------ ------ ------ ------
INVESTMENT OPERATIONS:
Investment income--net..... .58 .50 .34 .27 .24
Net realized and unrealized
gain (loss) on
investments.............. 1.89 (.89) 2.63 .44 .58
------ ------ ------ ------ ------
TOTAL FROM
INVESTMENT
OPERATIONS........ 2.47 (.39) 2.97 .71 .82
------ ------ ------ ------ ------
DISTRIBUTIONS:
Dividends from investment
income--net.............. (.59) (.51) (.35) (.24) (.30)
Dividends in excess of
investment income--net... -- -- -- -- (.03)
Dividends from net realized
gain on investments...... (.36) (.37) (.28) (.34) (.66)
------ ------ ------ ------ ------
TOTAL
DISTRIBUTIONS.... (.95) (.88) (.63) (.58) (.99)
------ ------ ------ ------ ------
Net asset value, end of
year..................... $12.07 $10.80 $13.14 $13.27 $13.10
------ ------ ------ ------ ------
------ ------ ------ ------ ------
TOTAL INVESTMENT RETURN............ 23.64%* (3.33%) 28.02% 5.53% 6.36%
RATIOS / SUPPLEMENTAL DATA:
Ratio of expenses to
average net assets....... .75% .77% .78% .74% .74%
Ratio of net investment
income to average net
assets................... 4.73% 4.20% 2.65% 2.08% 1.67%
Portfolio Turnover Rate.... 104.28% 98.58% 79.70% 55.42% 39.29%
Net Assets, end of year
(000's Omitted).......... $2,536,151 $2,525,321 $2,996,663 $3,148,858 $2,850,523
- -----------------------------------
<FN>
*Exclusive of sales charge.
</TABLE>
- --------------------------------------------------------------------------------
See notes to financial statements.
<PAGE>
NOTES TO FINANCIAL
STATEMENTS
NOTE 1-- SIGNIFICANT ACCOUNTING POLICIES:
The Fund is registered under the Investment Company Act of 1940 ("Act")
as a diversified open-end management investment company. Dreyfus Service
Corporation ("Distributor") acts as the exclusive distributor of the Fund's
shares, which are sold to the public without a sales charge. The Distributor is
a wholly-owned subsidiary of The Dreyfus Corporation ("Manager").
(A) PORTFOLIO VALUATION: Investments in securities are valued at the
last sales price on the securities exchange on which such securities are
primarily traded or at the last sales price on the national securities market.
Securities not listed on an exchange or the national securities market, or
securities for which there were no transactions, are valued at the average of
the most recent bid and asked prices. Bid price is used when no asked price is
available. Securities for which there are no such valuations are valued at fair
value as determined in good faith under the direction of the Board of Directors.
Short-term investments are carried at amortized cost, which approximates value.
Investments traded in foreign currencies are translated to U.S. dollars at the
prevailing rates of exchange.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities
transactions are recorded on a trade date basis. Realized gain and loss from
securities transactions are recorded on the identified cost basis. Dividend
income is recognized on the ex-dividend date and interest income, including,
where applicable, amortization of discount on investments, is recognized on the
accrual basis.
(C) DIVIDENDS TO SHAREHOLDERS: Dividends are recorded on the ex-dividend
date. Dividends from investment income-net are declared and paid on a quarterly
basis. Dividends from net realized capital gain are normally declared and paid
annually. The Fund may make distributions on a more frequent basis to comply
with the distribution requirements of the Internal Revenue Code. To the extent
that net realized capital gain can be offset by capital loss carryovers, if any,
it is the policy of the Fund not to distribute such gain.
Dividends in excess of investment income-net result primarily from
foreign currency transactions which are treated as ordinary income for tax
purposes and as capital gains for financial statement purposes.
(D) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to
qualify as a regulated investment company, if such qualification is in the best
interests of its shareholders, by complying with the provisions available to
certain investment companies, as defined in applicable sections of the Internal
Revenue Code, and to make distributions of taxable income sufficient to relieve
it from all, or substantially all, Federal income taxes.
NOTE 2--MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement ("Agreement") with the Manager,
the management fee is payable monthly, based on the following annual percentages
of the average daily value of the Fund's net assets: .65 of 1% of the first $1.5
billion; .625 of 1% of the next
<PAGE>
$500 million; .6 of 1% of the next $500 million; and .55 of 1% over $2.5
billion.
The Agreement provides for an expense reimbursement from the Manager
should the Fund's aggregate expenses, exclusive of taxes and brokerage
commissions, exceed 1% of the average daily value of the Fund's net assets for
any full year. No expense reimbursement was required pursuant to the Agreement
for the year ended December 31, 1993.
(B) Certain officers and directors of the Fund are "affiliated persons,"
as defined in the Act, of the Manager and/or the Distributor. Each director who
is not an "affiliated person" receives an annual fee of $6,500 and an attendance
fee of $500 per meeting.
(C) On December 5, 1993, the Manager entered into an Agreement and Plan
of Merger providing for the merger of the Manager with a subsidiary of Mellon
Bank Corporation ("Mellon").
Following the merger, it is planned that the Manager will be a direct
subsidiary of Mellon Bank, N.A. Closing of this merger is subject to a number of
contingencies, including the receipt of certain regulatory approvals and the
approvals of the stockholders of the Manager and of Mellon. The merger is
expected to occur in mid-1994, but could occur later.
Because the merger will constitute an "assignment" of the Fund's
Management Agreement with the Manager under the Investment Company Act of 1940,
and thus a termination of such Agreement, the Manager will seek prior approval
from the Fund's Board and shareholders.
- --------------------------------------------------------------------------------
NOTE 3--SECURITIES TRANSACTIONS:
(A) The aggregate amount of purchases and sales of investments,
excluding short-term securities, options transactions and forward currency
exchange contracts, during the year ended December 31, 1993, amounted to
$987,489,319 and $1,212,668,000, respectively.
In addition, the following summarizes open forward currency exchange
contracts at December 31, 1993:
<TABLE>
<CAPTION>
U.S. Dollar
Value at Unrealized
Forward Currency Sale Contracts Proceeds 12/31/1993 Appreciation
- -------------------------------- ----------- ----------- ------------
<S> <C> <C> <C>
Deutsche Marks, expiring 1/13/94.................... $12,835,472 $12,648,767 $186,705
Japanese Yen, expiring 2/15/94 and 2/17/94.......... 25,017,406 24,485,405 532,001
------------
$718,706
------------
------------
</TABLE>
<PAGE>
When executing forward currency exchange contracts, the Fund is
obligated to buy or sell a foreign currency at a specified rate on a certain
date in the future. With respect to sales of forward currency exchange
contracts, the Fund would incur a loss if the value of the contract increases
between the date the forward contract is opened and the date the forward
contract is closed. The Fund realizes a gain if the value of the contract
decreases between those dates. With respect to purchases of forward currency
exchange contracts, the Fund would incur a loss if the value of the contract
decreases between the date the forward contract is opened and the date the
forward contract is closed. The Fund realizes a gain if the value of the
contract increases between these dates.
(B) At December 31, 1993, accumulated net unrealized appreciation on
investments was $692,078,515, consisting of $744,471,097 gross unrealized
appreciation and $52,392,582 gross unrealized depreciation.
At December 31, 1993, the cost of investments for Federal income tax
purposes was substantially the same as the cost for financial reporting purposes
(see the Statement of Investments).
<PAGE>
REPORT OF ERNST & YOUNG,
INDEPENDENT AUDITORS
SHAREHOLDERS AND BOARD OF DIRECTORS
THE DREYFUS FUND INCORPORATED
We have audited the accompanying statement of assets and liabilities of The
Dreyfus Fund Incorporated, including the statement of investments, as of
December 31, 1993, and the related statement of operations for the year then
ended, the statement of changes in net assets for each of the two years in the
period then ended, and financial highlights for each of the years indicated
therein. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1993, by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of The
Dreyfus Fund Incorporated at December 31, 1993, the results of its operations
for the year then ended, the changes in its net assets for each of the two years
in the period then ended, and the financial highlights for each of the indicated
years, in conformity with generally accepted accounting principles.
ERNST & YOUNG
New York, New York
February 9, 1994
<PAGE>
IMPORTANT TAX INFORMATION (UNAUDITED)
For Federal Tax purposes the Fund hereby designates $.16 per share as a
longterm capital gain distribution of the $.23 per share paid on June 24, 1993.
The Fund also designates $.50 per share as a longterm capital gain distribution
of the $.63 per share paid on December 21, 1993.
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT
IN THE DREYFUS FUND INCORPORATED AND THE STANDARD
& POOR'S 500 COMPOSITE STOCK PRICE INDEX *
EXHIBIT A:
___________________________________________
| | STANDARD | |
| | & POOR'S 500 | THE |
| PERIOD |COMPOSITE STOCK| DREYFUS |
| | PRICE INDEX * | FUND |
|-----------|---------------|--------------|
| 12/31/51 | 10,000 | 10,000 |
| 12/31/52 | 11,840 | 10,437 |
| 12/31/53 | 11,722 | 10,426 |
| 12/31/54 | 17,887 | 17,094 |
| 12/31/55 | 23,540 | 21,634 |
| 12/31/56 | 25,093 | 24,887 |
| 12/31/57 | 22,383 | 23,767 |
| 12/31/58 | 32,097 | 36,617 |
| 12/31/59 | 35,949 | 45,971 |
| 12/31/60 | 36,129 | 49,066 |
| 12/31/61 | 45,847 | 61,990 |
| 12/31/62 | 41,859 | 53,563 |
| 12/31/63 | 51,402 | 67,003 |
| 12/31/64 | 59,884 | 78,289 |
| 12/31/65 | 67,369 | 101,770 |
| 12/31/66 | 60,565 | 103,506 |
| 12/31/67 | 75,101 | 131,100 |
| 12/31/68 | 83,437 | 146,511 |
| 12/31/69 | 76,345 | 128,868 |
| 12/31/70 | 79,398 | 120,805 |
| 12/31/71 | 90,752 | 137,760 |
| 12/31/72 | 107,995 | 150,414 |
| 12/31/73 | 92,120 | 121,928 |
| 12/31/74 | 67,708 | 97,676 |
| 12/31/75 | 92,896 | 128,698 |
| 12/31/76 | 115,005 | 163,843 |
| 12/31/77 | 106,724 | 163,899 |
| 12/31/78 | 113,768 | 183,947 |
| 12/31/79 | 134,702 | 230,811 |
| 12/31/80 | 178,345 | 301,036 |
| 12/31/81 | 169,606 | 317,341 |
| 12/31/82 | 205,902 | 362,707 |
| 12/31/83 | 252,229 | 434,405 |
| 12/31/84 | 268,120 | 448,407 |
| 12/31/85 | 354,455 | 560,839 |
| 12/31/86 | 420,029 | 652,370 |
| 12/31/87 | 441,870 | 708,583 |
| 12/31/88 | 516,104 | 770,529 |
| 12/31/89 | 678,677 | 952,677 |
| 12/31/90 | 656,960 | 920,941 |
| 12/31/91 | 857,332 | 1,178,926 |
| 12/31/92 | 923,347 | 1,244,137 |
| 12/31/93 | 1,014,758 | 1,323,210 |
|------------------------------------------|
|-----------------------------------------------------------|
| THE DREYFUS FUND |
| |
|-----------------------------------------------------------|
| AVERAGE ANNUAL TOTAL RETURNS ENDED ON 12/31/93 |
|-----------|---------------|--------------|----------------|
| | | | SINCE |
| 1 YEAR | 5 YEAR | 10 YEAR | 12/31/51 |
|-----------|---------------|--------------|----------------|
| 6.36%| 11.42%| 11.78%| 12.33%|
|-----------|---------------|--------------|----------------|
The Dreyfus Fund Incorporated December 31, 1993
Broad Sector Allocation*
-----------------------------------------------------------
|Financial 18.0% |
|Consumer Staples 14.4 |
|Cash Equivalents 13.4 |
|Consumer Cyclical 12.8 |
|Other 12.5 |
|Transportation 9.4 |
|Consumer Growth Staples 9.1 |
|Technology 6.7 |
|Capital Goods 3.7 |
|-----------------------------------------------------------|
