ALLIANCE INTERNATIONAL FUND
ANNUAL REPORT
JUNE 30, 1998
ALLIANCE CAPITAL
LETTER TO SHAREHOLDERS ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
August 24, 1998
Dear Shareholder:
This annual report contains investment results and market activity for Alliance
International Fund for the periods ended June 30, 1998. We are pleased to
inform you that your Fund is now being managed by Bruce W. Calvert, Chief
Investment Officer and Director of Global Equity Research at Alliance. In
addition to heading up the global equity research department, Mr. Calvert
oversees all of the firm's investment management activities. Mr. Calvert has a
total of 29 years of investment experience, 25 years at Alliance.
ECONOMIC REVIEW
During the second quarter of 1998, the global economy continued to wrestle with
the effects of the Asian financial crisis. Final domestic demand in both the
United States and Europe remained strong, but demand in Japan continued to
decline. Growth in manufacturing output in most developed countries slowed.
Weakness in commodity prices, especially oil, and falling import prices kept
consumer price index (CPI) inflation rates on downward trajectories. The major
central banks held official interest rates steady. U.S. and European stock
prices spent most of the second quarter in a consolidating mode, ultimately
posting small gains, while Tokyo stocks struggled and were basically flat in
the quarter. The U.S. dollar appreciated slightly on a trade-weighted basis
during the past three months, while the German mark held steady and the
Japanese yen lost ground.
INVESTMENT RESULTS
Your Fund's Class A shares performed in line with both of the Fund's benchmarks
for the six-month period ended June 30, 1998, posting returns of 15.43% at net
asset value (NAV) compared with 15.76% for the MSCI World Index (minus the
U.S.) and 15.50% for the Lipper International Funds Average. During the
12-month period ended June 30, 1998, your Fund's Class A shares achieved
returns of 6.79% at NAV while the MSCI Index and Lipper Average posted returns
of 6.59% and 8.19%, respectively.
INVESTMENT RESULTS*
Periods Ended June 30, 1998
TOTAL RETURNS
6 MONTHS 12 MONTHS
--------- ---------
ALLIANCE INTERNATIONAL FUND
Class A 15.43% 6.79%
Class B 14.92% 5.92%
Class C 14.91% 5.85%
MSCI WORLD INDEX (minus the U.S.) 15.76% 6.59%
LIPPER INTERNATIONAL FUNDS AVERAGE 15.50% 8.19%
* THE FUND'S INVESTMENT RESULTS ARE TOTAL RETURNS FOR THE PERIOD AND ARE BASED
ON THE NET ASSET VALUE OF EACH CLASS OF SHARES AS OF JUNE 30, 1998. ALL FEES
AND EXPENSES RELATED TO THE OPERATION OF THE FUND HAVE BEEN DEDUCTED, BUT NO
ADJUSTMENT HAS BEEN MADE FOR SALES CHARGES THAT MAY APPLY WHEN SHARES ARE
PURCHASED OR REDEEMED. TOTAL RETURN FOR ADVISOR CLASS SHARES WILL DIFFER DUE TO
DIFFERENT EXPENSES CHARGED TO THAT CLASS. RETURNS FOR THE FUND AND ITS
COMPARATIVE BENCHMARKS INCLUDE THE REINVESTMENT OF ANY DISTRIBUTIONS PAID
DURING THE PERIOD. PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
ALL COMPARATIVE BENCHMARKS ARE UNMANAGED AND REFLECT NO FEES OR EXPENSES.
THE MORGAN STANLEY CAPITAL INTERNATIONAL WORLD INDEX (MINUS THE U.S.), TRACKS
THE PERFORMANCE OF STOCK MARKETS IN 22 FOREIGN COUNTRIES. THE LIPPER
INTERNATIONAL FUNDS AVERAGE FOR THE SIX- AND 12-MONTH PERIODS ENDED JUNE 30,
1998 REFLECTS THE PERFORMANCE OF 544 AND 480 MUTUAL FUNDS, RESPECTIVELY. THESE
FUNDS HAVE GENERALLY SIMILAR INVESTMENT OBJECTIVES TO YOUR FUND, ALTHOUGH
INVESTMENT POLICIES FOR THE VARIOUS FUNDS MAY DIFFER. AN INVESTOR CANNOT INVEST
DIRECTLY IN THE INDEX OR AVERAGE.
ADDITIONAL INVESTMENT RESULTS APPEAR ON PAGE 4.
ECONOMIC OUTLOOK
Our outlook for global financial markets assumes that the strains created by
the Asian crisis, while persisting for several more months, will eventually be
unwound. However, many countries in East Asia, including Japan, will experience
negative growth in 1998. These reversals will be mitigated by a substantial
growth transfer from the United States, Europe and China totaling at least $100
billion. Low interest rates, lofty stock prices, and relatively strong
currencies will facilitate this growth "export."
1
ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
Overall growth in the United States and Europe may temporarily slip below
2%--in China, below 7%--by this summer. However, this process should not go on
indefinitely, and a significant portion of the adjustment may have already
occurred. Wage and benefit increases have been slowly escalating in the United
States, and we expect that acceleration will show through during the remainder
of 1998 as CPI inflation rises above 2%. Inflation in Europe is likely to
remain subdued given the high levels of unemployment and wide output gaps,
while inflation is hardly a worry in Japan's recessionary environment.
Central bank policy remains in a reactive mode, although a modest upward
adjustment of official rates is possible later this year or in 1999, once the
Asian shock wave passes.
The "mini-bubble" in stock prices in the United States and Europe that occurred
during the first quarter of 1998 appears to have deflated. We believe that the
fundamentals are in place for U.S. equities to produce returns of 10%-12% over
the next year, and for European equities to do even better thanks to the advent
of monetary union. Only bold action by the Japanese authorities in tackling
their economic and banking problems can turn the tide in their stock market.
FUND STRATEGY
In managing your Fund, our investment strategy will emphasize stock selection
and investment in a limited number of comparatively large, high-quality
companies. In following this strategy, we utilize the fundamental analysis and
research of Alliance's large global equity research team situated in numerous
locations around the world. The Fund's sector and geographic weightings will be
a by-product of our "bottom-up" stock selection approach rather than
predetermined allocation.
As of June 30, 1998, we have placed some emphasis on companies in the consumer
services, health care and finance sectors as well as geographically in Japan,
the United Kingdom and the Netherlands.
INDUSTRIAL AND GEOGRAPHIC BREAKDOWNS AS OF JUNE 30, 1998*
7.9% CONSUMER MANUFACTURING
13.4% OTHER
16.9% CONSUMER SERVICES
6.8% UTILITIES
11.1% TECHNOLOGY
12.0% CONSUMER STAPLES
16.4% HEALTH CARE
15.5% FINANCE
15.6% JAPAN
44.0% OTHER
14.4% THE NETHERLANDS
10.1% SWITZERLAND
15.9% UNITED KINGDOM
* EXPRESSED AS A PERCENTAGE OF TOTAL INVESTMENTS.
2
ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
We thank you for your continued interest and investment in Alliance
International Fund and look forward to reporting its progress to you in future
periods.
Sincerely,
John D. Carifa
Chairman and President
Bruce W. Calvert
Senior Vice President
SHARES OF THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, GUARANTEED OR ENDORSED
BY, ANY BANK; FURTHER, SUCH SHARES ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY.
SHARES OF THE FUND INVOLVE INVESTMENT RISKS, INCLUDING THE POSSIBLE LOSS OF
PRINCIPAL.
3
INVESTMENT OBJECTIVE AND POLICIES ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
Alliance International Fund is a diversified investment company that seeks to
provide investors with a total return on its assets from long-term growth of
capital and income. The Fund invests principally in marketable securities of
established non-U.S. companies participating in foreign economies with
prospects of growth and foreign government securities.
INVESTMENT RESULTS
_______________________________________________________________________________
NAV AND SEC AVERAGE ANNUAL TOTAL RETURNS AS OF JUNE 30, 1998
CLASS A SHARES
WITHOUT WITH
SALES CHARGE SALES CHARGE
------------ ------------
One Year 6.79% 2.25%
Five Years 10.05% 9.10%
Ten Years 8.47% 8.00%
CLASS B SHARES
WITHOUT WITH
SALES CHARGE SALES CHARGE
------------ ------------
One Year 5.92% 1.98%
Five Years 9.13% 9.13%
Since Inception* 6.56% 6.56%
CLASS C SHARES
WITHOUT WITH
SALES CHARGE SALES CHARGE
------------ ------------
One Year 5.85% 4.86%
Five Years 9.13% 9.13%
Since Inception* 8.57% 8.57%
The Fund's investment results represent average annual total returns. The NAV
and SEC returns reflect reinvestment of dividends and/or capital gains
distributions in additional shares without (NAV) and with (SEC) the effect of
the 4.25% maximum front-end sales charge for Class A or applicable contingent
deferred sales charge for Class B (4% year 1, 3% year 2, 2% year 3, 1% year 4);
and for Class C shares (1% year 1). Returns for Class A shares do not reflect
the imposition of the 1 year 1% contingent deferred sales charge for accounts
over $1,000,000. Total return for Advisor Class shares will differ due to
different expenses associated with that class.
SEC average annual total returns for the periods shown reflect reinvestment of
all distributions and deduction of the maximum 4.25% front-end sales charges
and applicable contingent deferred sales charges.
Past performance does not guarantee future results. Investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their original cost.
* Inception: 9/17/90, Class B; 5/3/93, Class C.
4
ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
ALLIANCE INTERNATIONAL FUND
GROWTH OF A $10,000 INVESTMENT
6/30/88 TO 6/30/98
$28,000
$24,000
$20,000
$16,000
$12,000
$10,000
$8,000
LIPPER INTERNATIONAL FUNDS AVERAGE: $27,306
ALLIANCE INTERNATIONAL FUND CLASS A: $21,592
MSCIWORLD INDEX (MINUS THE U.S.): $20,027
6/30/88 6/30/89 6/30/90 6/30/91 6/30/92 6/30/93
6/30/94 6/30/95 6/30/96 6/30/97 6/30/98
This chart illustrates the total value of an assumed $10,000 investment in
Alliance International Fund Class A shares (from 6/30/88 to 6/30/98) as
compared to the performance of an appropriate broad-based index. The chart
reflects the deduction of the maximum 4.25% sales charge from the initial
$10,000 investment in the Fund and assumes the reinvestment of dividends and
capital gains. Performance for Class B, Class C and Advisor Class shares will
vary from the results shown above due to differences in expenses charged to
those classes. Past performance is not indicative of future results, and is not
representative of future gain or loss in capital value or dividend income.
The Morgan Stanley Capital International World Index (minus the United States)
is an unmanaged, market-capitalization-weighted index that measures the
performance of stock markets in 22 countries outside the United States.
The Lipper International Funds Average reflects performance of 35 funds (based
on the number of funds in the average from 6/30/88 to 6/30/98). These funds
have generally similar investment objectives to Alliance International Fund,
although the investment policies of some funds included in the average may vary.
When comparing Alliance International Fund to the index and average shown
above, you should note that no charges or expenses are reflected in the
performance of the index. Lipper results include fees and expenses.
Alliance International Fund
Lipper International Funds Average
MSCIWorld Index (minus the U.S)
5
TEN LARGEST HOLDINGS
JUNE 30, 1998 ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
PERCENT OF
COMPANY U.S. $ VALUE NET ASSETS
- -------------------------------------------------------------------------------
Nokia AB Series A--Develops and manufactures
mobile phones, networks, and systems for
cellular and fixed networks. $16,206,735 6.0%
Akzo Nobel NV--A worldwide operating company,
products include chemicals, man-made fibres,
paints, enamels and salts, ethical drugs,
veterinary products, hospital supplies and
diagnostics. 15,576,088 5.7
Nestle AG--A holding company whose subsidiaries
produce and sell a variety of food and consumer
products. 10,717,823 4.0
International Nederlander Groep NV--Offers a wide
range of financial services to individuals,
corporations and other institutions. 10,487,067 3.9
Diageo Plc.--Has operations in food, alcoholic
beverages, fast food restaurants, and property
management. 9,028,736 3.3
Ladbroke Group Plc.--Diversified company with
interests in off-track betting, hotels, and
real estate. 8,239,970 3.0
Sanofi SA--Researches and manufactures health
care products and beauty aids. 7,224,391 2.7
Credito Italiano--Provides a full range of
banking services. 6,810,858 2.5
Novartis AG--Manufactures healthcare products for
use in medical fields, as well as nutritional
and agricultural products. 6,667,107 2.5
Telebras (ADR)--A holding company for the
telecommunications sector in Brazil. 6,551,250 2.4
$97,510,025 36.0%
6
INDUSTRY DIVERSIFICATION
JUNE 30, 1998 ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
U.S. $ VALUE PERCENT OF NET ASSETS
- -------------------------------------------------------------------------------
Basic Industries $ 11,222,657 4.1%
Capital Goods 4,207,227 1.6
Consumer Manufacturing 21,245,932 7.9
Consumer Services 45,851,028 16.9
Consumer Staples 32,432,393 12.0
Energy 8,631,257 3.2
Finance 41,899,845 15.5
Healthcare 44,347,619 16.4
Multi Industry 8,285,724 3.1
Technology 30,149,471 11.1
Utilities 18,399,069 6.8
Total Investments* 266,672,222 98.6
Cash and receivables, net of liabilities 3,845,086 1.4
Net Assets $270,517,308 100.0%
* Excludes short-term obligations.
7
PORTFOLIO OF INVESTMENTS
JUNE 30, 1998 ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
COMPANY SHARES U.S. $ VALUE
- -------------------------------------------------------------------------
COMMON & PREFERRED STOCKS-98.6%
AUSTRALIA-0.3%
Normandy Mining, Ltd. 1,000,000 $ 819,390
BRAZIL-2.4%
Telebras (ADR) 60,000 6,551,250
CANADA-0.6%
Newcourt Credit Group, Inc. (a) 37,600 1,845,830
DENMARK-2.0%
Ratin AS Cl. B 25,000 5,297,270
FINLAND-8.3%
Nokia AB Series A 220,000 16,206,735
Orion-Yhtyma OY Series B 205,195 6,331,153
------------
22,537,888
FRANCE-6.4%
Sanofi SA 61,387 7,224,391
Seita (b) 70,000 3,174,708
Total, SA Cl. B (b) 50,000 6,505,007
Union des Assurances Federales, SA 1,800 283,936
------------
17,188,042
GERMANY-7.1%
Adidas Salomon AG 35,000 6,057,748
Merck KG AA 18,410 824,168
Prosieben Media AG pfd. (a) 91,360 4,753,872
Volkswagen AG 6,000 5,774,832
Wella AG pfd. 1,500 1,697,501
------------
19,108,121
HONG KONG-3.2%
Cheung Kong Holdings 450,600 2,221,595
Dickson Concepts International, Ltd. 404,500 563,836
Hong Kong Electric Holdings, Ltd. 500,000 1,548,787
Hutchison Whampoa, Ltd. 800,000 4,212,700
------------
8,546,918
ITALY-4.3%
Credito Italiano 1,300,000 6,810,858
Telecom Italia Spa 640,000 4,715,154
------------
11,526,012
JAPAN-15.6%
Bridgestone Corp. (b) 150,000 3,561,475
Canon, Inc. 117,000 2,667,849
Daiwa Securities Co., Ltd. 700,000 3,025,082
Fuji Photo Film Co. 78,000 2,727,135
Honda Motor Co. (b) 135,000 4,827,536
Japan Tobacco, Inc. 271 1,842,043
Nintendo Co. (b) 40,000 3,720,728
Orix Corp. 30,000 2,034,818
Rohm Co., Ltd. (b) 36,000 3,713,489
Sankyo Co., Ltd. 40,000 914,981
Sony Corp. (b) 50,000 4,325,166
TDK Corp. (b) 54,000 4,006,660
Tokai Bank 390,000 2,156,864
Yamanouchi Pharmaceutical Co., Ltd. (b) 130,000 2,719,606
------------
42,243,432
MEXICO-1.1%
Coca-Cola Femsa, SA (ADR) 25,000 434,375
Panamerican Beverages Cl. A 80,000 2,515,000
------------
2,949,375
NETHERLANDS-14.5%
Akzo Nobel NV 70,000 15,576,088
ASM Lithography Holding NV (a) 120,000 3,554,738
International Nederlander Groep NV 160,000 10,487,067
Philips Electronics NV 50,000 4,207,227
Wolters Kluwer CVA 38,776 5,327,313
------------
39,152,433
8
ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
SHARES OR
PRINCIPAL
AMOUNT
COMPANY (000) U.S. $ VALUE
- -------------------------------------------------------------------------
SOUTH KOREA-0.0%
S.K. Telecom Co., Ltd. (ADR) 4,269 $ 23,746
SPAIN-3.9%
Tabacalera, SA Cl. A 230,000 4,719,708
Telefonica, SA 120,000 5,560,132
Unidad Editorial, SA (c) 297,500 311,075
------------
10,590,915
SWEDEN-2.9%
Astra AB Series A 200,000 4,090,125
Sparbanken Sverige AB Series A 40,000 1,204,454
Volvo AB Cl. B 90,000 2,681,792
------------
7,976,371
SWITZERLAND-10.1%
Ciba Specialty Chemical Holding 40,000 5,144,291
Nestle AG (b) 5,000 10,717,823
Novartis AG 4,000 6,667,107
Zurich Vericher Namen 7,482 4,782,788
------------
27,312,009
UNITED KINGDOM-15.9%
BPB Industries Plc. 600,000 3,636,607
Bank of Scotland 375,000 4,201,383
Compass Group Plc. 500,000 5,760,465
Diageo Plc. 760,000 9,028,736
Granada Group Plc. 130,000 2,392,012
Ladbroke Group Plc. 1,500,000 8,239,970
Stolt Comex Seaway, SA 75,600 1,464,750
(ADR) 37,800 661,500
Tomkins Plc. 750,000 4,073,024
United Assurance Group Plc. 300,000 2,845,169
United News & Media, Inc. 50,000 699,604
------------
43,003,220
Total Common & Preferred Stocks
(cost $230,736,625) 266,672,222
TIME DEPOSIT-1.7%
Royal Bank of Canada,
5.75%, 7/01/98
(cost $4,500,000) $4,500 4,500,000
TOTAL INVESTMENTS-100.3%
(cost $235,236,625) 271,172,222
Other assets less liabilities-(0.3)% (654,914)
NET ASSETS-100% $ 270,517,308
(a) Non-income producing security.
(b) Securities, or a portion thereof, with an aggregate market value of
$31,068,988 have been segregated to collateralize forward exchange currency
contracts.
(c) Restricted and illiquid securities valued at fair value (See Notes A & F).
Glossary:
ADR - American Depositary Receipt
See notes to financial statements.
9
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1998 ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
ASSETS
Investments in securities, at value (cost $235,236,625) $271,172,222
Cash, at value (cost $1,378,373) 1,375,633
Receivable for investment securities and foreign currency sold 3,101,710
Receivable for shares of beneficial interest sold 2,077,550
Dividends and interest receivable 358,999
Foreign taxes receivable 306,707
Unrealized appreciation of forward exchange currency contract 2,276
Total assets 278,395,097
LIABILITIES
Payable for shares of beneficial interest redeemed 3,827,886
Payable for investment securities and foreign currency purchased 3,032,022
Advisory fee payable 574,849
Distribution fee payable 97,843
Accrued expenses 345,189
Total liabilities 7,877,789
NET ASSETS $270,517,308
COMPOSITION OF NET ASSETS
Shares of beneficial interest, at par $ 149,083
Additional paid-in capital 222,024,226
Undistributed net investment income 1,829,171
Accumulated net realized gain on investments and foreign
currency transactions 10,576,194
Net unrealized appreciation of investments and foreign
currency denominated assets and liabilities 35,938,634
$270,517,308
CALCULATION OF MAXIMUM OFFERING PRICE
CLASS A SHARES
Net asset value and redemption price per share ($131,564,997/
7,094,137 shares of beneficial interest issued and outstanding) $18.55
Sales charge--4.25% of public offering price .82
Maximum offering price $19.37
CLASS B SHARES
Net asset value and offering price per share ($71,370,335/
4,098,451 shares of beneficial interest issued and outstanding) $17.41
CLASS C SHARES
Net asset value and offering price per share ($20,427,825/
1,172,543 shares of beneficial interest issued and outstanding) $17.42
ADVISOR CLASS SHARES
Net asset value, redemption and offering price per share
($47,154,151 / 2,543,195 shares of beneficial interest
issued and outstanding) $18.54
See notes to financial statements.
10
STATEMENT OF OPERATIONS
YEAR ENDED JUNE 30, 1998 ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
INVESTMENT INCOME
Dividends (net of foreign taxes withheld
of $519,257) $4,115,694
Interest 242,699 $ 4,358,393
EXPENSES
Advisory fee 2,718,678
Distribution fee - Class A 251,400
Distribution fee - Class B 729,494
Distribution fee - Class C 211,941
Custodian 635,742
Transfer agency 512,895
Audit and legal 141,724
Administrative 127,000
Printing 111,563
Registration 70,853
Trustees' fees 25,000
Miscellaneous 88,476
Total expenses 5,624,766
Less: expenses waived by adviser (407,802)
Net expenses 5,216,964
Net investment loss (858,571)
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
AND FOREIGN CURRENCY TRANSACTIONS
Net realized gain on investment transactions 18,748,042
Net realized gain on foreign currency transactions 3,357,394
Net change in unrealized appreciation of:
Investments (882,601)
Foreign currency denominated assets and liabilities (156,892)
Net gain on investments and foreign currency transactions 21,065,943
NET INCREASE IN NET ASSETS FROM OPERATIONS $20,207,372
See notes to financial statements.
11
STATEMENT OF CHANGES IN NET ASSETS ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
YEAR ENDED YEAR ENDED
JUNE 30, JUNE 30,
1998 1997
------------- -------------
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income (loss) $ (858,571) $ 136,758
Net realized gain on investments and foreign
currency transactions 22,105,436 11,103,038
Net change in unrealized appreciation
(depreciation)of investments and foreign
currency denominated assets and liabilities (1,039,493) 13,688,698
Net increase in net assets from operations 20,207,372 24,928,494
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income
Class A (340,015) (1,212,031)
Advisor Class (164,972) (6,456)
Net realized gain on investments and foreign
currency transactions
Class A (8,564,124) (11,329,853)
Class B (5,015,932) (4,543,388)
Class C (1,492,502) (1,515,641)
Advisor Class (2,849,305) (47,863)
CAPITAL STOCK TRANSACTIONS
Net decrease (31,125,975) (2,106,765)
Total increase (decrease) (29,345,453) 4,166,497
NET ASSETS
Beginning of year 299,862,761 295,696,264
End of year (including undistributed net
investment income of $1,829,171 and
$91,546, respectively) $270,517,308 $299,862,761
See notes to financial statements.
12
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1998 ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
NOTE A: SIGNIFICANT ACCOUNTING POLICIES
Alliance International Fund (the "Fund"), which is a Massachusetts business
trust, is registered under the Investment Company Act of 1940, as a
diversified, open-end management investment company. The Fund offers Class A,
Class B, Class C, and Advisor Class shares. Class A shares are sold with a
front-end sales charge of up to 4.25% for purchases not exceeding $1,000,000.
With respect to purchases of $1,000,000 or more, Class A shares redeemed within
one year of purchase will be subject to a contingent deferred sales charge of
1%. Class B shares are sold with a contingent deferred sales charge which
declines from 4% to zero depending on the period of time the shares are held.
Class B shares will automatically convert to Class A shares eight years after
the end of the calendar month of purchase. Class C shares are subject to a
contingent deferred sales charge of 1% on redemptions made within the first
year after purchase. Advisor Class shares are sold without an initial or
contingent deferred sales charge and are not subject to ongoing distribution
expenses. Advisor Class shares are offered to investors participating in fee
based programs and to certain retirement plan accounts. All four classes of
shares have identical voting, dividend, liquidation and other rights, except
that each class bears different distribution expenses and has exclusive voting
rights with respect to its distribution plan. The financial statements have
been prepared in conformity with generally accepted accounting principles which
require management to make certain estimates and assumptions that affect the
reported amounts of assets and liabilities in the financial statements and
amounts of income and expenses during the reporting period. Actual results
could differ from those estimates. The following is a summary of significant
accounting policies followed by the Fund.
1. SECURITY VALUATION
Portfolio securities traded on a national securities exchange or on a foreign
securities exchange (other than foreign securities exchanges whose operations
are similar to those of the United States over-the-counter market) are
generally valued at the last reported sales price or if no sale occurred, at
the mean of the closing bid and asked price on that day. Readily marketable
securities traded in the over-the-counter market, securities listed on a
foreign securities exchange whose operations are similar to the U.S.
over-the-counter market, and securities listed on a national securities
exchange whose primary market is believed to be over-the-counter, are valued at
the mean of the current bid and asked price. U.S. government and fixed income
securities which mature in 60 days or less are valued at amortized cost, unless
this method does not represent fair value. Securities for which current market
quotations are not readily available are valued at their fair value as
determined in good faith by, or in accordance with procedures adopted by, the
Board of Trustees. Fixed income securities may be valued on the basis of prices
obtained from a pricing service when such prices are believed to reflect the
fair market value of such securities.
2. CURRENCY TRANSLATION
Assets and liabilities denominated in foreign currencies and commitments under
forward exchange currency contracts are translated into U.S. dollars at the
mean of the quoted bid and asked price of such currencies against the U.S.
dollar. Purchases and sales of portfolio securities are translated at the rates
of exchange prevailing when such securities were acquired or sold. Income and
expenses are translated at rates of exchange prevailing when accrued.
Net realized foreign exchange gains and losses represent gains and losses from
sales and maturities of debt securities, holding of foreign currency contracts,
foreign currencies, exchange gains and losses realized between the trade and
settlement dates on security transactions, and the difference between the
amounts of dividends, interest and foreign taxes receivable recorded on the
Fund's books and the U.S. dollar equivalent of the amounts actually received or
paid. Net currency gains and losses from valuing foreign currency denominated
assets and liabilities at period end exchange rates are reflected as a
component of net unrealized appreciation of investments and foreign currency
denominated assets and liabilities.
3. TAXES
It is the Fund's policy to meet the requirements of the Internal Revenue Code
applicable to regulated investment companies and to distribute all of its
investment company taxable income and net realized gains, if any, to
shareholders. Therefore, no provisions for federal income or excise taxes are
required.
13
NOTES TO FINANCIAL STATEMENTS (CONTINUED) ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
4. INVESTMENT INCOME AND INVESTMENT TRANSACTIONS
Dividend income is recorded on the ex-dividend date. Interest income is accrued
daily. Investment transactions are accounted for on the date securities are
purchased or sold. Investment gains and losses are determined on the identified
cost basis. The Fund accretes discounts on short-term securities as adjustments
to interest income.
5. INCOME AND EXPENSES
All income earned and expenses incurred by the Fund are borne on a pro-rata
basis by each outstanding class of shares, based on the proportionate interest
in the Fund represented by the net assets of such class, except that the Fund's
Class B and Class C shares bear higher distribution and transfer agent fees
than Class A shares and the Advisor Class shares have no distribution fees.
6. DIVIDENDS AND DISTRIBUTIONS
Dividends and distributions to shareholders are recorded on the ex-dividend
date.
Income and capital gains distributions are determined in accordance with
federal tax regulations and may differ from those determined in accordance with
generally accepted accounting principles. To the extent these differences are
permanent, such amounts are reclassified within the capital accounts based on
their federal tax basis treatment; temporary differences do not require such
reclassification. During the current fiscal year, permanent differences,
primarily due to net foreign currency gains, resulted in a net increase in
undistributed net investment income, and a corresponding decrease in
accumulated net realized gain on investments and foreign currency transactions.
This reclassification had no affect on net assets.
NOTE B: ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES
Under an investment advisory agreement, the Fund pays Alliance Capital
Management L.P. (the "Adviser") a fee at a quarterly rate equal to 1/4 of 1%
(approximately 1% on an annual basis) of quarter end net assets up to $500
million and 3/16 of 1% (approximately .75% on an annual basis) of quarter end
net assets in excess of $500 million. Effective July 1, 1997 the Adviser has
voluntarily agreed to waive unilaterally, for a minimum of two years, that
portion of the Fund's advisory fee on the first $500 million of net assets in
excess of the annualized rate of .85 of 1%. Such waiver amounted to $407,802.
Pursuant to the advisory agreement, the Fund paid $127,000 to the Adviser
representing the cost of certain legal and accounting services provided to the
Fund by the Adviser for the year ended June 30, 1998.
The Fund compensates Alliance Fund Services, Inc. (a wholly-owned subsidiary of
the Adviser) under a Transfer Agency Agreement for providing personnel and
facilities to perform transfer agency services for the Fund. Such compensation
amounted to $376,447 for the year ended June 30, 1998.
Alliance Fund Distributors, Inc. (a wholly-owned subsidiary of the Adviser)
serves as the Distributor of the Fund's shares. The Distributor received
$2,606, $153,795 and $6,763 in contingent deferred sales charges from the
redemptions of Class A, Class B and Class C shares, respectively for the year
ended June 30, 1998.
Brokerage commissions paid on investment transactions for the year ended June
30, 1998, amounted to $1,675,091, none of which was paid to brokers utilizing
the services of the Pershing Division of Donaldson, Lufkin & Jenrette
Securities Corp. ("DLJ"), an affiliate of the Adviser, nor to DLJ directly.
NOTE C: DISTRIBUTION SERVICES AGREEMENT
The Fund has adopted a Distribution Services Agreement (the "Agreement")
pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the
Agreement the Fund pays a distribution fee to the Distributor at an annual rate
of up to .30 of 1% of the average daily net assets attributable to Class A
shares and 1% of the average daily net assets attributable to the Class B and
Class C shares. There is no distribution fee on the Advisor Class shares. The
fees are accrued daily and paid monthly. The Agreement provides that the
Distributor will use such payments in their entirety for distribution
14
ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
assistance and promotional activities. The Distributor has incurred expenses in
excess of the distribution costs reimbursed by the Fund in the amount of
$2,638,659 and $838,475, for Class B and Class C shares, respectively; such
costs may be recovered from the Fund in future periods so long as the Agreement
is in effect. In accordance with the Agreement, there is no provision for
recovery of unreimbursed distribution costs, incurred by the Distributor,
beyond the current fiscal year for Class A shares. The Agreement also provides
that the Adviser may use its own resources to finance the distribution of the
Fund's shares.
NOTE D: INVESTMENT TRANSACTIONS
Purchases and sales of investment securities (excluding short-term and U.S.
government securities) aggregated $321,444,896 and $364,575,592, respectively,
for the year ended June 30, 1998. There were no purchases or sales of U.S.
government or government agency obligations for the year ended June 30, 1998.
At June 30, 1998, the cost of investments for federal income tax purposes was
$239,602,853. Accordingly, gross unrealized appreciation of investments was
$43,956,953 and gross unrealized depreciation of investments was $12,387,584
resulting in net unrealized appreciation of $31,569,369 (excluding foreign
currency transactions).
FORWARD EXCHANGE CURRENCY CONTRACTS
The Fund enters into forward foreign exchange currency contracts in order to
hedge its exposure to changes in foreign currency exchange rates on its foreign
portfolio holdings and to hedge certain firm purchase and sale commitments
denominated in foreign currencies. A forward foreign exchange currency contract
is a commitment to purchase or sell a foreign currency at a future date at a
negotiated forward rate. The gain or loss arising from the difference between
the original contract and the closing of such contract is included in net
realized gain or loss on foreign currency transactions. Fluctuations in the
value of open forward foreign exchange currency contracts are recorded for
financial reporting purposes as unrealized gains or losses by the Fund.
The Fund's custodian will place and maintain cash not available for investment
or liquid assets having a value equal to the aggregate amount of the Fund's
commitments under forward foreign exchange currency contracts entered into with
respect to position hedges.
Risks may arise from the potential inability of a counterparty to meet the
terms of a contract and from unanticipated movements in the value of a foreign
currency relative to the U.S. dollar.
At June 30, 1998, the Fund had one outstanding forward foreign exchange
currency contract as follows:
CONTRACT VALUE ON U.S. $
AMOUNT ORIGINATION CURRENT UNREALIZED
(000) DATE VALUE APPRECIATION
--------- ----------- ----------- ------------
FOREIGN CURRENCY SALE CONTRACT
Japanese Yen,
settling 9/24/98 2,921,639 $21,416,500 $21,414,224 $2,276
15
NOTES TO FINANCIAL STATEMENTS (CONTINUED) ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
NOTE E: SHARES OF BENEFICIAL INTEREST
There is an unlimited number of $.01 par value shares of beneficial interest
authorized, divided into four classes, designated Class A, Class B, Class C and
Advisor Class. Transactions in shares of beneficial interest were as follows:
SHARES AMOUNT
-------------------------- ------------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997
------------ ------------ -------------- --------------
CLASS A
Shares sold 24,484,292 6,622,075 $ 429,262,692 $ 114,715,975
Shares issued in
reinvestment of
dividends and
distributions 434,528 663,141 7,195,776 11,054,555
Shares converted
from Class B 135,142 117,002 2,418,317 2,047,012
Shares redeemed (28,137,023) (7,939,629) (501,332,312) (137,402,166)
Net decrease (3,083,061) (537,411) $ (62,455,527) $ (9,584,624)
CLASS B
Shares sold 5,858,963 2,125,113 $ 98,173,143 $ 35,155,961
Shares issued in
reinvestment of
distributions 253,584 214,830 3,960,979 3,409,345
Shares converted
to Class A (143,173) (123,261) (2,422,365) (2,047,012)
Shares redeemed (6,258,880) (1,982,904) (105,349,658) (32,750,197)
Net increase
(decrease) (289,506) 233,778 $ (5,637,901) $ 3,768,097
CLASS C
Shares sold 1,285,146 1,792,800 $ 21,956,475 $ 29,797,881
Shares issued in
reinvestment of
distributions 55,617 50,633 869,855 804,053
Shares redeemed (1,480,320) (2,075,557) (25,121,032) (34,583,108)
Net decrease (139,557) (232,124) $ (2,294,702) $(3,981,174)
YEAR ENDED OCT. 2,1996(A) YEAR ENDED OCT. 2,1996(A)
JUNE 30 TO JUNE 30, TO
1998 JUNE 30,1997 1998 JUNE 30, 1997
------------ ------------ -------------- --------------
ADVISOR CLASS
Shares sold 2,988,364 501,850 $ 56,300,890 $ 8,317,799
Shares issued in
reinvestment of
dividends and
distributions 181,876 2,960 3,008,222 49,249
Shares redeemed (1,092,832) (39,023) (20,046,957) (676,112)
Net increase 2,077,408 465,787 $ 39,262,155 $ 7,690,936
(a) Commencement of distribution.
16
ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
NOTE F: RESTRICTED AND ILLIQUID SECURITIES
DATE
SECURITY ACQUIRED U.S. $ COST
- -------- -------- -----------
Unidad Editorial, SA 1/20/92 $369,591
The security shown above is restricted as to sale and has been valued at fair
value in accordance with procedures described in Note A. The value of this
security at June 30, 1998 was $311,075 representing 0.1% of net assets.
NOTE G: CONCENTRATION OF RISK
Investing in securities of foreign companies involves special risks which
include revaluation of currency and future adverse political and economic
developments. Moreover, securities of many foreign companies and their markets
may be less liquid and their prices more volatile than those of comparable U.S.
companies.
NOTE H: BANK BORROWING
A number of open-end mutual funds managed by the Adviser, including the Fund,
participate in a $500 million revolving credit facility (the "Facility") to
provide for short-term financing if necessary in connection with abnormal
redemption activity. Commitment fees related to the Facility are paid by the
participating funds and are included in the miscellaneous expenses in the
statement of operations. During the year ended June 30, 1998, the Fund had
borrowings outstanding for 6 days and the weighted average interest on such
borrowings was 6.12%. The Fund had no borrowings outstanding on June 30, 1998.
17
FINANCIAL HIGHLIGHTS ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF BENEFICIAL INTEREST OUTSTANDING THROUGHOUT EACH
YEAR
<TABLE>
<CAPTION>
CLASS A
----------------------------------------------------------------
YEAR ENDED JUNE 30,
----------------------------------------------------------------
1998 1997 1996 1995 1994
------------ ----------- ----------- ---------- ------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year $18.69 $18.32 $16.81 $18.38 $16.01
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (.01)(a) .06(a) .05(a) .04 (.09)
Net realized and unrealized gain on
investments and foreign currency
transactions 1.13 1.51 2.51 .01 3.02
Net increase in net asset value from
operations 1.12 1.57 2.56 .05 2.93
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.05) (.12) -0- -0- -0-
Distributions from net realized gains
on investments and foreign currency
transactions (1.21) (1.08) (1.05) (1.62) (.56)
Total dividends and distributions (1.26) (1.20) (1.05) (1.62) (.56)
Net asset value, end of year $18.55 $18.69 $18.32 $16.81 $18.38
TOTAL RETURN
Total investment return(b) 6.79% 9.30% 15.83% .59% 18.68%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year (000's omitted) $131,565 $190,173 $196,261 $165,584 $201,916
Ratios to average net assets of:
Expenses, net of waivers 1.65% 1.73% 1.72% 1.73% 1.90%
Expenses, before waivers 1.80% 1.74%(c) 1.72% 1.73% 1.90%
Ratio of net investment income (loss)
to average net assets (.05)% .31% .31% .26% (.50)%
Portfolio turnover rate 121% 94% 78% 119% 97%
</TABLE>
See footnote summary on page 21.
18
ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF BENEFICIAL INTEREST OUTSTANDING THROUGHOUT EACH
YEAR
<TABLE>
<CAPTION>
CLASS B
-----------------------------------------------------------------
YEAR ENDED JUNE 30,
-----------------------------------------------------------------
1998 1997 1996 1995 1994
------------ ----------- ------------ ---------- ------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year $17.71 $17.45 $16.19 $17.90 $15.74
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (.16)(a) (.09)(a) (.07)(a) (.01) (.19)(a)
Net realized and unrealized gain (loss)
on investmentsand foreign currency
transactions 1.07 1.43 2.38 (.08) 2.91
Net increase (decrease) in net asset
value from operations .91 1.34 2.31 (.09) 2.72
LESS: DISTRIBUTIONS
Distributions from net realized gains on
investments and foreign currency
transactions (1.21) (1.08) (1.05) (1.62) (.56)
Net asset value, end of year $17.41 $17.71 $17.45 $16.19 $17.90
TOTAL RETURN
Total investment return(b) 5.92% 8.37% 14.87% (.22)% 17.65%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $71,370 $77,725 $72,470 $48,998 $29,943
Ratios to average net assets of:
Expenses, net of waivers 2.49% 2.58% 2.55% 2.57% 2.78%
Expenses, before waivers 2.64% 2.59%(c) 2.55% 2.57% 2.78%
Ratio of net investment loss to average
net assets (.90)% (.51)% (.46)% (.62)% (1.15)%
Portfolio turnover rate 121% 94% 78% 119% 97%
</TABLE>
See footnote summary on page 21.
19
FINANCIAL HIGHLIGHTS (CONTINUED) ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF BENEFICIAL INTEREST OUTSTANDING THROUGHOUT EACH
YEAR
<TABLE>
<CAPTION>
CLASS C
---------------------------------------------------------------
YEAR ENDED JUNE 30,
---------------------------------------------------------------
1998 1997 1996 1995 1994
------------ ----------- ----------- ---------- -----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year $17.73 $17.46 $16.20 $17.91 $15.74
INCOME FROM INVESTMENT OPERATIONS
Net investment loss (.15)(a) (.09)(a) (.07)(a) (.14) (.11)
Net realized and unrealized gain on
investments and foreign currency
transactions 1.05 1.44 2.38 .05 2.84
Net increase (decrease) in net asset
value from operations .90 1.35 2.31 (.09) 2.73
LESS: DISTRIBUTIONS
Distributions from net realized gains
on investments and foreign currency
transactions (1.21) (1.08) (1.05) (1.62) (.56)
Net asset value, end of year $17.42 $17.73 $17.46 $16.20 $17.91
TOTAL RETURN
Total investment return(b) 5.85% 8.42% 14.85% (.22)% 17.72%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year (000's omitted) $20,428 $23,268 $26,965 $19,395 $13,503
Ratios to average net assets of:
Expenses, net of waivers 2.48% 2.56% 2.53% 2.54% 2.78%
Expenses, before waivers 2.63% 2.58%(c) 2.53% 2.54% 2.78%
Ratio of net investment loss to
average net assets (.90)% (.51)% (.47)% (.88)% (1.12)%
Portfolio turnover rate 121% 94% 78% 119% 97%
</TABLE>
See footnote summary on page 21.
20
ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF BENEFICIAL INTEREST OUTSTANDING THROUGHOUT EACH
PERIOD
ADVISOR CLASS
--------------------------
OCTOBER 2,
YEAR ENDED 1996(D)
JUNE 30, TO
1998 JUNE 30, 1997
---------- --------------
Net asset value, beginning of period $18.67 $17.96
INCOME FROM INVESTMENT OPERATIONS
Net investment income(a) .02 .16
Net realized and unrealized gain on investments
and foreign currency transactions 1.13 1.78
Net increase in net asset value from
operations 1.15 1.94
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.07) (.15)
Distributions from net realized gains on
investments and foreign currency transactions (1.21) (1.08)
Total dividends and distributions (1.28) (1.23)
Net asset value, end of period $18.54 $18.67
TOTAL RETURN
Total investment return based on net asset value(b) 6.98% 11.57%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $47,154 $8,697
Ratios to average net assets of:
Expenses, net of waivers 1.47% 1.69%(e)
Expenses, before waivers 1.62% 1.69%(c)(e)
Ratio of net investment income to average net assets .13% 1.47%
Portfolio turnover rate 121% 94%
(a) Based on average shares outstanding.
(b) Total investment return is calculated assuming an initial investment made
at the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period. Initial sales charges or contingent
deferred sales charges are not reflected in the calculation of total investment
return. Total investment return calculated for a period of less than one year
is not annualized.
(c) Ratio reflects expenses grossed up for expense offset arrangement with the
transfer agent. For the year ended June 30, 1997, the net expense ratio was
1.73%, 2.58%, 2.56% and 1.69% for Class A, B, C and Advisor Class shares,
respectively.
(d) Commencement of distribution.
(e) Annualized.
21
REPORT OF ERNST & YOUNG LLP
INDEPENDENT AUDITORS ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
TO THE SHAREHOLDERS AND BOARD OF TRUSTEES ALLIANCE INTERNATIONAL FUND
We have audited the accompanying statement of assets and liabilities of
Alliance International Fund, including the portfolio of investments, as of June
30, 1998, 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 the financial highlights for each of the periods indicated therein.
These financial statements and financial highlights are the responsibility of
the Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of June
30, 1998, 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
Alliance International Fund at June 30, 1998, 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
periods, in conformity with generally accepted accounting principles.
New York, New York
August 7, 1998
TAX INFORMATION (UNAUDITED)
_______________________________________________________________________________
In order to meet certain requirements of the Internal Revenue Code we are
advising you that $3,412,498 and $6,496,032 of the capital gain distributions
paid by the fund during the fiscal year June 30, 1998 are subject to maximum
tax rates of 28% and 20% respectively.
In addition, the Fund intends to make an election under Internal Revenue Code
Section 853 to pass through foreign taxes paid by the Fund to its shareholders.
The total amount of foreign taxes that may be passed through to the
shareholders for the fiscal year ended June 30, 1998 is $519,257. The foreign
source income for information reporting purposes in $3,029,126.
Shareholders should not use the above information to prepare their tax returns.
The information necessary to complete your income tax returns will be included
with your Form 1099 DIV which will be sent to you separately in January 1999.
22
ALLIANCE INTERNATIONAL FUND
_______________________________________________________________________________
TRUSTEES
JOHN D. CARIFA, CHAIRMAN AND PRESIDENT
DAVID H. DIEVLER (1)
JOHN H. DOBKIN (1)
W.H. HENDERSON (1)
STIG HOST (1)
ALAN STOGA (1)
OFFICERS
BRUCE W. CALVERT, SENIOR VICE PRESIDENT
KATHLEEN A. CORBET, SENIOR VICE PRESIDENT
EDWARD BAKER, VICE PRESIDENT
STEPHEN M. BEINHACKER, VICE PRESIDENT
MARK H. BREEDON, VICE PRESIDENT
EDMUND P. BERGAN, JR., SECRETARY
MARK D. GERSTEN, TREASURER & CHIEF FINANCIAL OFFICER
VINCENT S. NOTO, CONTROLLER
CUSTODIAN
BROWN BROTHERS HARRIMAN & CO.
40 Water Street
Boston, MA 02109
PRINCIPAL UNDERWRITER
ALLIANCE FUND DISTRIBUTORS, INC.
1345 Avenue of the Americas
New York, NY 10105
LEGAL COUNSEL
SEWARD & KISSEL
One Battery Park Plaza
New York, NY 10004
INDEPENDENT AUDITORS
ERNST & YOUNG LLP
787 Seventh Avenue
New York, NY 10019
TRANSFER AGENT
ALLIANCE FUND SERVICES, INC.
P.O. Box 1520
Secaucus, NJ 07096-1520
Toll-Free 1-(800) 221-5672
(1) Member of Audit Committee.
23
ALLIANCE INTERNATIONAL FUND
1345 Avenue of the Americas
New York, NY 10105
(800) 221-5672
ALLIANCE CAPITAL
THIS REPORT IS INTENDED SOLELY FOR DISTRIBUTION TO CURRENT SHAREHOLDERS
OF THE FUND.
R THESE REGISTERED SERVICE MARKS USED UNDER LICENSE FROM THE OWNER,
ALLIANCE CAPITAL MANAGEMENT L.P.
INTAR
