<PAGE>
THE DREYFUS FUND
INCORPORATED
ANNUAL REPORT
1994
<PAGE>
DIRECTORS
John J. Pyburn
Assistant Treasurer
Joseph S. DiMartino
Chairman of the Board*
Ruth D. Leibert
Assistant Secretary
Lucy Wilson Benson
Paul Furcinito
David W. Burke
Assistant Secretary
Martin D. Fife
PORTFOLIO MANAGERS
Whitney I. Gerard
Howard Stein
Robert R. Glauber
Ernest Wiggins
Arthur A. Hartman
Wolodymyr Wronskyj
George L. Perry
Paul Wolfowitz
OFFICERS
Marie E. Connolly
President and Treasurer
John E. Pelletier
Vice President and Secretary
Frederic C. Dey
Vice President and Assistant Treasurer
Joseph F. Tower III
Assistant Treasurer
CUSTODIAN
The Bank of New York
110 Washington Street
New York, N.Y. 10286
AUDITORS
Ernst & Young LLP
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
DISTRIBUTOR
Premier Mutual Fund Services, Inc.
One Exchange Place
Boston, MA 02109
*As of February 2, 1995
Further information is contained in the Prospectus
which must precede or accompany this report.
<PAGE>
- --------------------------------------------------------------------------------
LETTER TO SHAREHOLDERS
Dear Shareholder:
The rise in interest rates last year brought on by the actions of the Federal
Reserve Board to slow down the economy and reduce potential inflation pressures
had an adverse impact on certain sectors of the stock market, in particular on
cyclical and financial stocks that had significant weightings in The Dreyfus
Fund Incorporated's portfolio.
We have lowered our exposure to these two interest-sensitive sectors. Among
the sales in these areas were shares in the automotive and housing industries,
banks and other financial enterprises. Companies where we sold stock included
First Chicago, AMBAC, EXEL Limited, Goodyear Tire & Rubber, PACCAR, Cummins
Engine, Eaton, Louisiana Pacific and Centex.
At some point, we believe, the rise in interest rates will slow down the rate
of growth of the economy. Accordingly, in making new commitments, we emphasize
companies that can show meaningful earnings growth in a moderately expanding
economy.
With this in mind, among the companies newly acquired for the portfolio were
Office Depot, Premark International, Grace (W.R.), United Technologies, NIKE
Cl.B, Royal Dutch Petroleum, Mobil, Chevron, Texaco, du Pont (E.I.) de Nemours
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
and others. The Fund continues to carry about 16% of assets in cash and cash
equivalents, which is not an unusual level for current market conditions. This
gives us a reserve to use when we see attractive buying opportunities.
For the fiscal year that ended December 31, 1994, the total return of The
Dreyfus Fund Incorporated was -4.26%.* This compared with 1.31% for the
Standard & Poor's 500 Composite Stock Price Index and 5.02% for the Dow Jones
Industrial Average of 30 blue chip stocks.**
It is our belief that interest rates should soon peak. We also think that
the outlook for corporate earnings is favorable. The S&P 500 Index appears to
us to be reasonably priced. Barring some unexpected development, this should
bode well for future stock market performance.
Very truly yours,
Wolodymyr Wronskyj
Portfolio Manager
January 11, 1995
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 U.S. stock market performance.
- --------------------------------------------------------------------------------
<PAGE>
THE DREYFUS FUND INCORPORATED DECEMBER 31, 1994
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN THE DREYFUS FUND
INCORPORATED AND THE STANDARD & POOR'S 500 COMPOSITE STOCK PRICE INDEX
$1,266,843
The Dreyfus Fund
[CHART]
$1,029,548
Standard & Poor's 500
Composite Stock
Price Index*
*Source: Lipper Analytical Services, Inc.
AVERAGE ANNUAL TOTAL RETURNS
<TABLE>
<S> <C> <C> <C>
ONE YEAR ENDED FIVE YEARS ENDED TEN YEARS ENDED FROM INCEPTION (5/24/51)
DECEMBER 31, 1994 DECEMBER 31, 1994 DECEMBER 31, 1994 TO DECEMBER 31, 1994
- ------------------ ------------------ ------------------ --------------------------
(4.26%) 5.87% 10.94% 12.00%
</TABLE>
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 graph 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.
<PAGE>
THE DREYFUS FUND INCORPORATED DECEMBER 31, 1994
ASSET ALLOCATION
[PIE CHART]
FIVE LARGEST SECTORS
<TABLE>
<S> <C> <C>
Consumer Cyclical.................................................... 14.8%
Technology........................................................... 11.6
Financial............................................................ 11.5
Consumer Staples..................................................... 10.6
Transportation....................................................... 9.7
</TABLE>
TEN LARGEST EQUITY HOLDINGS
<TABLE>
<S> <C> <C>
Chrysler............................................................. 3.0%
Lowe's Cos........................................................... 2.8
Procter & Gamble..................................................... 2.5
Hewlett-Packard...................................................... 2.5
Gillette............................................................. 2.4
McDonald's........................................................... 2.4
Conrail.............................................................. 2.4
Philip Morris Cos.................................................... 2.4
General Electric..................................................... 2.3
MBNA................................................................. 2.2
</TABLE>
All percentages shown above are based on Total Net Assets.
<PAGE>
COMMON STOCK
PURCHASES AND SALES (UNAUDITED)
six months ended December 31, 1994
PURCHASES(1)
NEW COMMITMENTS:
Chevron, Dayton Hudson, duPont (E.I.) de Nemours, Federal Express, Grace
(W.R.), Mobil, NIKE Cl. B, Office Depot, Premark International, Royal Dutch
Petroleum, Tenneco, Texaco, United Technologies, Weyerhaeuser and Williams Cos.
ADDITIONS:
Galen Partners II L.P. (Units), SK Equity Fund L.P. (Units) and Western
National.
SALES
REDUCTIONS:
Bank of New York, GE Investment Private Placement Partners I L.P. (Units),
Mellon Bank, PepsiCo and Roche Holdings A.D.S.
ELIMINATIONS:
AMBAC, Campbell Soup, Centex, Colgate-Palmolive, Cummins Engine, Dana,
Eastman Chemical, Eaton, EXEL Limited, First Chicago, Goodyear Tire & Rubber,
Hasbro, ITT, Masco, PACCAR, RJR Nabisco Holdings, Rayonier, Schering-Plough and
Sun Microsystems.
ELIMINATION OF SECURITIES ACQUIRED DURING THE SIX MONTHS:
cisco Systems and Louisiana Pacific.
(1) Not shown are increases resulting from stock dividends and splits.
<PAGE>
<TABLE>
<CAPTION>
THE DREYFUS FUND INCORPORATED
STATEMENT OF INVESTMENTS December 31, 1994
COMMON STOCKS--83.5% SHARES VALUE
------------ --------------
<S> <C> <C> <C>
BASIC INDUSTRIES--3.0% Grace (W.R.)......................... 500,000 $ 19,312,500
Mead................................. 500,000 24,312,500
SK Equity Fund, L.P. (Units)......... 15.647(c) 15,902,148
Weyerhaeuser......................... 400,000 15,000,000
--------------
74,527,148
--------------
CAPITAL GOODS--4.6% Eastman Kodak........................ 750,000 35,812,500
General Electric..................... 1,090,000 55,590,000
Varity............................... 600,000(a) 21,750,000
--------------
113,152,500
--------------
CHEMICALS--.7% duPont (E.I.) de Nemours............. 300,000 16,875,000
--------------
CONGLOMERATES--2.5% Dial................................. 2,000,000 42,500,000
Tenneco.............................. 400,000 17,000,000
--------------
59,500,000
--------------
CONSUMER CYCLICAL--14.8% Chrysler............................. 1,500,000 73,500,000
Dayton Hudson........................ 200,000 14,150,000
Echlin............................... 500,000 15,000,000
Ford Motor........................... 1,600,000 44,800,000
Fruit of The Loom, Cl. A............. 700,000(a) 18,900,000
General Motors....................... 500,000 21,125,000
Home Depot........................... 400,000 18,400,000
NIKE, Cl. B.......................... 300,000 22,387,500
Office Depot......................... 500,000(a) 12,000,000
Penney (J.C.)........................ 400,000 17,850,000
Reebok International................. 500,000 19,750,000
Sears, Roebuck....................... 1,000,000 46,000,000
Toys R Us............................ 250,000(a) 7,625,000
Wal-Mart Stores...................... 500,000 10,625,000
Whirlpool............................ 400,000 20,100,000
--------------
362,212,500
--------------
CONSUMER SERVICES--4.4% Columbia/HCA Healthcare.............. 250,000 9,125,000
Cracker Barrel Old Country........... 500,000 9,250,000
Mattel............................... 1,250,000 31,406,250
McDonald's........................... 2,000,000 58,500,000
--------------
108,281,250
--------------
CONSUMER STAPLES--10.6% ConAgra.............................. 500,000 15,625,000
Gillette............................. 800,000 59,800,000
PepsiCo.............................. 650,000 23,562,500
Philip Morris Cos.................... 1,000,000 57,500,000
Premark International................ 400,000 17,900,000
Procter & Gamble..................... 1,000,000 62,000,000
Roche Holdings A.D.S................. 275,000(b) 13,182,813
Sara Lee............................. 400,000 10,100,000
--------------
259,670,313
--------------
<PAGE>
THE DREYFUS FUND INCORPORATED
STATEMENT OF INVESTMENTS (CONTINUED) December 31, 1994
COMMON STOCKS (CONTINUED) SHARES VALUE
------------ --------------
CREDIT CYCLICAL--3.7% Green Tree Financial................. 700,000 $ 21,262,500
Lowe's Cos........................... 2,000,000 69,500,000
--------------
90,762,500
--------------
ENERGY--5.2% Canadian Gas Gathering Systems, Cl.
A.................................... 245,312(a,c) 2,453,123
Chevron.............................. 400,000 17,850,000
GE Investment Private Placement
Partners I, L.P. (Units)........... 14.175(c) 14,753,448
Mobil................................ 300,000 25,275,000
Royal Dutch Petroleum................ 300,000 32,250,000
Texaco............................... 300,000 17,962,500
Williams Cos......................... 350,000 8,793,750
Yorktown Energy Partners, L.P.
(Units).............................. 7.357(c) 8,262,362
--------------
127,600,183
--------------
FINANCIAL--11.2% ADVANTA, Cl. A....................... 15,000 393,750
ADVANTA, Cl. B....................... 485,000 12,246,250
Bank of New York..................... 800,000 23,200,000
Chase Manhattan (Warrants)........... 11,772(a) 57,388
First Data........................... 800,000 37,900,000
First Financial Management........... 500,000 30,812,500
First USA............................ 500,000 16,437,500
GFC Financial........................ 650,000 20,637,500
Galen Partners II, L.P. (Units)...... 3.290(c) 2,991,595
MBNA................................. 2,250,000 52,593,750
Mellon Bank.......................... 324,700 9,943,938
NationsBank.......................... 500,000 22,562,500
Travelers............................ 666,666 21,666,645
Western National..................... 1,750,000 22,531,250
--------------
273,974,566
--------------
TECHNOLOGY--11.6% Advanced Micro Devices............... 500,000(a) 12,437,500
Computer Associates International.... 500,000 24,250,000
Computer Sciences.................... 500,000(a) 25,500,000
Electronic Arts...................... 525,000(a) 10,106,250
Hewlett-Packard...................... 600,000 59,925,000
Intel................................ 500,000 31,937,500
MCI Communications................... 1,025,000 18,834,375
Sprint............................... 950,000 26,243,750
TRW.................................. 400,000 26,400,000
United Technologies.................. 300,000 18,862,500
Xerox................................ 300,000 29,700,000
--------------
284,196,875
--------------
TRANSPORTATION--9.7% Burlington Northern.................. 700,000 33,687,500
CSX.................................. 600,000 41,775,000
Conrail.............................. 1,140,000 57,570,000
Federal Express...................... 173,800(a) 10,471,450
Illinois Central..................... 1,000,000 30,750,000
Norfolk Southern..................... 500,000 30,312,500
Ryder System......................... 400,000 8,800,000
Union Pacific........................ 500,000 22,812,500
--------------
236,178,950
--------------
<PAGE>
THE DREYFUS FUND INCORPORATED
STATEMENT OF INVESTMENTS (CONTINUED) December 31, 1994
COMMON STOCKS (CONTINUED) SHARES VALUE
------------ --------------
UTILITIES--1.5% AT&T................................. 700,000 $ 35,175,000
--------------
TOTAL COMMON STOCKS
(cost $1,622,238,925).............. $2,042,106,785
--------------
--------------
CONVERTIBLE PREFERRED STOCK--.3%
USF&G, Ser. B, Cum., $10.25
(cost $4,925,000).................. 50,000(c) $ 6,515,066
--------------
--------------
PRINCIPAL
CORPORATE BONDS--.3% AMOUNT
------------
Canadian Gas Gathering Systems:
14%, 8/29/2005..................... $ 187,500(c) $ 187,500
14%, 10/31/2005.................... 187,500(c) 187,500
14%, 7/24/2006..................... 531,633(c) 531,633
14%, 12/10/2006.................... 2,184,406(c) 2,184,406
14%, 4/8/2007...................... 549,478(c) 549,478
14%, 11/17/2007.................... 1,675,266(c) 1,675,266
14%, 6/30/2008..................... 1,930,747(c) 1,930,747
14%, 12/29/2008.................... 112,831(c) 112,831
--------------
TOTAL CORPORATE BONDS
(cost $7,359,361).................. $ 7,359,361
--------------
--------------
SHORT-TERM INVESTMENTS--15.9%
TIME DEPOSITS--6.9% Chemical Bank (London),
5%, 1/3/1995....................... $ 85,000,000 $ 85,000,000
Republic National Bank of New York
(London),
4%, 1/3/1995....................... 83,000,000 83,000,000
--------------
168,000,000
--------------
U.S. GOVERNMENT & AGENCIES--9.0% Federal Home Loan Mortgage:
5.90%, 1/4/1995.................... 50,000,000 49,975,417
5.97%, 1/26/1995................... 96,212,000 95,813,121
Federal National Mortgage
Association,
5.96%, 1/31/1995................... 75,000,000 74,627,500
--------------
220,416,038
--------------
TOTAL SHORT-TERM INVESTMENTS
(cost $388,416,038)................ $ 388,416,038
--------------
--------------
TOTAL INVESTMENTS (cost $2,022,939,324)................................. 100.0% $2,444,397,250
------ --------------
------ --------------
CASH AND RECEIVABLES (NET).............................................. 0.0% $ 903,232
------ --------------
------ --------------
NET ASSETS.............................................................. 100.0% $2,445,300,482
------ --------------
------ --------------
<PAGE>
THE DREYFUS FUND INCORPORATED
STATEMENT OF INVESTMENTS (CONTINUED) December 31, 1994
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. This security amounted to .54%
of net assets.
(c) Securities restricted as to public resale. Investments in restricted
securities with an aggregate market value of $58,237,103 represent
approximately 2.38% of net assets:
ACQUISITION PURCHASE PERCENTAGE OF
ISSUER DATE PRICE* NET ASSETS VALUATION+
------------------ ------------- ------------- -------------------------
Canadian Gas Gathering Systems, Cl. A 8/29/90-7/1/94 $ 10.00 .10% $ 10.00 per share
Canadian Gas Gathering Systems 14%:
8/29/2005-12/29/2008 8/29/90-7/1/94 100.00 .30 par
GE Investment Private Placement
Partners I, L.P. (Units) 5/28/91-6/22/94 1,040,807.62 .60 1,040,807.62 per unit
Galen Partners II, L.P. (Units) 12/8/93-11/29/94 909,299.39 .12 909,299.39 per unit
SK Equity Fund, L.P. (Units) 12/16/92-11/7/94 1,016,306.51 .65 1,016,306.51 per unit
USF&G, Ser. B, Cum., $10.25 6/3/91 98.50 .27 130.30 per share
Yorktown Energy Partners, L.P. (Units) 3/25/91-3/30/94 1,123,061.30 .34 1,123,061.30 per unit
<FN>
* Average cost.
+ The valuation of these securities has been determined in good faith under the
direction of the Board of Directors.
- ------------------
Subject to certain limitations, the Fund has commitments to invest in limited
partnerships listed below:
PORTION OF COMMITTED
ISSUER AMOUNTS UNINVESTED
- ------ --------------------
GE Investment Private Placement Partners I, L.P. (Units) $ 4,791,314
Galen Partners II, L.P. (Units) 1,710,116
SK Equity Fund, L.P. (Units) 30,383,919
See notes to financial statements.
</TABLE>
<PAGE>
THE DREYFUS FUND INCORPORATED
STATEMENT OF
ASSETS AND LIABILITIES
December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ASSETS:
<S> <C> <C>
Investments in securities, at value
(cost $2,022,939,324)--see statement.......................... $2,444,397,250
Cash............................................................ 64,731
Dividends and interest receivable............................... 6,106,820
Receivable for subscriptions to Capital Stock................... 923,822
Prepaid expenses................................................ 56,786
--------------
2,451,549,409
LIABILITIES:
Due to The Dreyfus Corporation.................................. $1,302,463
Payable for Capital Stock redeemed.............................. 4,247,219
Accrued expenses................................................ 699,245 6,248,927
---------- --------------
NET ASSETS........................................................ $2,445,300,482
--------------
--------------
REPRESENTED BY:
Paid-in capital................................................. $1,979,375,418
Accumulated undistributed net realized gain on investments...... 44,467,138
Accumulated net unrealized appreciation on investments--Note
3(b).......................................................... 421,457,926
--------------
NET ASSETS at value applicable to 204,909,040 shares outstanding
(300 million shares of $1 par value Capital Stock authorized)... $2,445,300,482
--------------
--------------
NET ASSET VALUE, offering and redemption price per share
($2,445,300,482 divided by 204,909,040 shares).................. $11.93
------
------
</TABLE>
- --------------------------------------------------------------------------------
See notes to financial statements.
<PAGE>
THE DREYFUS FUND INCORPORATED
STATEMENT OF
OPERATIONS
Year ended December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INVESTMENT INCOME:
<S> <C> <C>
INCOME:
Cash dividends (net of $81,474 foreign taxes withheld at
source).................................................... $ 48,229,678
Interest..................................................... 15,424,350
------------
TOTAL INCOME............................................ $ 63,654,028
EXPENSES:
Management fee--Note 2(a).................................... 16,866,777
Shareholder servicing costs.................................. 2,427,619
Custodian fees............................................... 191,739
Prospectus and shareholders' reports......................... 144,311
Professional fees............................................ 108,237
Directors' fees and expenses--Note 2(b)...................... 62,350
Registration fees............................................ 57,369
Miscellaneous................................................ 32,262
------------
TOTAL EXPENSES.......................................... 19,890,664
-------------
INVESTMENT INCOME--NET.................................. 43,763,364
-------------
REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS:
Net realized gain on investments
(including options transactions)--Note 3(a).................. $116,754,284
Net realized (loss) on forward currency exchange
contracts--Note 3(a); Short transactions..................... (775,318)
------------
NET REALIZED GAIN....................................... 115,978,966
Net unrealized (depreciation) on investments and forward
currency exchange contracts.................................. (270,620,589)
-------------
NET REALIZED AND UNREALIZED (LOSS) ON
INVESTMENTS........................................... (154,641,623)
-------------
NET (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS..................................................... $(110,878,259)
-------------
-------------
</TABLE>
- --------------------------------------------------------------------------------
See notes to financial statements.
<PAGE>
THE DREYFUS FUND INCORPORATED
STATEMENT OF
CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------------------
1993 1994
--------------- ---------------
<S> <C> <C>
OPERATIONS:
Investment income--net.................................... $ 49,842,001 $ 43,763,364
Net realized gain on investments.......................... 134,240,029 115,978,966
Net unrealized appreciation (depreciation) on investments
for the year............................................ 12,667,571 (270,620,589)
--------------- ---------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS............................................ 196,749,601 (110,878,259)
--------------- ---------------
DIVIDENDS TO SHAREHOLDERS:
From investment income--net............................... (63,624,901) (43,763,364)
In excess of investment income--net....................... (6,130,584) --
From net realized gain on investments..................... (140,044,515) (79,518,304)
--------------- ---------------
TOTAL DIVIDENDS......................................... (209,800,000) (123,281,668)
--------------- ---------------
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold............................. 12,798,442,290 6,662,064,854
Dividends reinvested...................................... 181,237,341 105,591,624
Cost of shares redeemed................................... (13,264,963,957) (6,938,719,174)
--------------- ---------------
(DECREASE) IN NET ASSETS FROM CAPITAL STOCK
TRANSACTIONS.......................................... (285,284,326) (171,062,696)
--------------- ---------------
TOTAL (DECREASE) IN NET ASSETS........................ (298,334,725) (405,222,623)
NET ASSETS:
Beginning of year......................................... 3,148,857,830 2,850,523,105
--------------- ---------------
End of year............................................... $ 2,850,523,105 $ 2,445,300,482
--------------- ---------------
--------------- ---------------
SHARES SHARES
<S> <C> <C>
--------------- ---------------
CAPITAL SHARE TRANSACTIONS:
Shares sold............................................... 965,802,077 517,021,740
Shares issued for dividends reinvested.................... 13,953,428 8,762,943
Shares redeemed........................................... (999,357,279) (538,493,724)
--------------- ---------------
NET (DECREASE) IN SHARES OUTSTANDING.................... (19,601,774) (12,709,041)
--------------- ---------------
--------------- ---------------
</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 the Fund's financial statements.
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------------------------------------
1990 1991 1992 1993 1994
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value, beginning of
year........................... $12.07 $10.80 $13.14 $13.27 $13.10
------ ------ ------ ------ ------
INVESTMENT OPERATIONS:
Investment income--net........... .50 .34 .27 .24 .21
Net realized and unrealized gain
(loss) on investments.......... (.89) 2.63 .44 .58 (.76)
------ ------ ------ ------ ------
TOTAL FROM INVESTMENT
OPERATIONS................... (.39) 2.97 .71 .82 (.55)
------ ------ ------ ------ ------
DISTRIBUTIONS:
Dividends from investment
income--net.................... (.51) (.35) (.24) (.30) (.22)
Dividends in excess of investment
income--net.................... -- -- -- (.03) --
Dividends from net realized gain
on investments................. (.37) (.28) (.34) (.66) (.40)
------ ------ ------ ------ ------
TOTAL DISTRIBUTIONS............ (.88) (.63) (.58) (.99) (.62)
------ ------ ------ ------ ------
Net asset value, end of year..... $10.80 $13.14 $13.27 $13.10 $11.93
------ ------ ------ ------ ------
------ ------ ------ ------ ------
TOTAL INVESTMENT RETURN............ (3.33%) 28.02% 5.53% 6.36% (4.26%)
RATIOS / SUPPLEMENTAL DATA:
Ratio of expenses to average net
assets......................... .77% .78% .74% .74% .74%
Ratio of net investment income to
average net assets............. 4.20% 2.65% 2.08% 1.67% 1.63%
Portfolio Turnover Rate.......... 98.58% 79.70% 55.42% 39.29% 27.70%
Net Assets, end of year
(000's Omitted)................ $2,525,321 $2,996,663 $3,148,858 $2,850,523 $2,445,300
</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,
until August 24, 1994, acted as the exclusive distributor of the Fund's shares,
which are sold to the public without a sales charge. Dreyfus Service Corporation
is a wholly-owned subsidiary of The Dreyfus Corporation ("Manager"). Effective
August 24, 1994, the Manager became a direct subsidiary of Mellon Bank, N.A.
On August 24, 1994, Premier Mutual Fund Services, Inc. (the "Distributor") was
engaged as the Fund's distributor. The Distributor, located at One Exchange
Place, Boston, Massachusetts 02109, is a wholly-owned subsidiary of
Institutional Administration Services, Inc., a provider of mutual fund
administration services, the parent company of which is Boston Institutional
Group, Inc.
(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 denominated in foreign currencies are translated to U.S. dollars at
the prevailing rates of exchange. Forward currency exchange contracts are valued
at the offsetting rate.
(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, but 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.
(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 applicable provisions of
the Internal Revenue Code, and to make distributions of taxable income
sufficient to relieve it from substantially all Federal income and excise
taxes.
<PAGE>
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 $500 million; .60 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, 1994.
(B) Prior to August 24, 1994, certain officers and directors of the Fund were
"affiliated persons," as defined in the Act, of the Manager and/or Dreyfus
Service Corporation. Each director who is not an "affiliated person" receives
an annual fee of $6,500 and an attendance fee of $500 per meeting.
NOTE 3--SECURITIES TRANSACTIONS:
(A) The aggregate amount of purchases and sales of investment securities,
excluding short-term securities, options transactions and forward currency
exchange contracts, during the year ended December 31, 1994, amounted to
$646,736,881 and $918,369,071, respectively.
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 those dates. At December 31, 1994, there were no forward currency
exchange contracts outstanding.
(B) At December 31, 1994, accumulated net unrealized appreciation on
investments was $421,457,926, consisting of $491,341,068 gross unrealized
appreciation and $69,883,142 gross unrealized depreciation.
At December 31, 1994, 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 LLP,
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, 1994, 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, 1994, by correspondence with the custodian. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of The
Dreyfus Fund Incorporated at December 31, 1994, 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 LLP
New York, New York
January 30, 1995
IMPORTANT TAX INFORMATION (UNAUDITED)
For Federal tax purposes the Fund hereby designates $.045 per share as a
longterm capital gain distribution of the $.10 per share paid on June 28,
1994. The Fund also designates $.40 per share as a longterm capital gain
distribution paid on December 20, 1994.
<PAGE>
THE DREYFUS FUND INCORPORATED - ANNUAL REPORT
THE DREYFUS FUND INCORPORATED
MANAGER--The Dreyfus Corporation/200 Park Ave., New York, NY 10166
DISTRIBUTOR--Premier Mutual Fund Services, Inc./One Exchange Place,
Boston, MA 02109
FINANCIAL CENTERS
Altamonte Springs/Atlanta/Beverly Hills/Boca Raton
Boston/Chicago/Coral Gables/Denver/Fort Lauderdale/Great Neck
Los Angeles/Morristown/Naples/New York City/Palm Beach Gardens/Paramus
San Francisco/Stamford/Uniondale/Walnut Creek/White Plains
PRINTED IN USA 026AR9412
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 | 1,016,235 | 1,323,210 |
| 12/31/94 | 1,029,548 | 1,266,843 |
|------------------------------------------|
*Source: Lipper Analytical Services, Inc.
The Dreyfus Fund Incorporated December 31, 1994
Asset Allocation
| --------------------------------------------- |
| Common Stocks 83.5% |
| Convertible Preferred Stock 0.3% |
| Corporate Bonds 0.3% |
| Cash Equivalents 15.9% |
| --------------------------------------------- |
