<PAGE>
- ----------------------------------------------------------------------
ANNUAL REPORT
August 31, 1995
Neuberger&Berman
INTERNATIONAL FUND -SM-
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
THE FUND
CHAIRMAN'S LETTER 4
PORTFOLIO MANAGER'S
COMMENTARY 6
GROWTH OF A DOLLAR
CHART 9
COMPARISON OF A
$10,000 INVESTMENT
FINANCIAL STATEMENTS 10
FINANCIAL HIGHLIGHTS 17
PER SHARE DATA
REPORT OF
INDEPENDENT AUDITORS 19
THE PORTFOLIO
SCHEDULE OF
INVESTMENTS 20
TOP TEN HOLDINGS
FINANCIAL STATEMENTS 25
FINANCIAL HIGHLIGHTS 32
REPORT OF
INDEPENDENT AUDITORS 33
DIRECTORY 34
OFFICERS AND
TRUSTEES 35
</TABLE>
3
<PAGE>
CHAIRMAN'S LETTER October 11, 1995
Dear Shareholder,
Over the last six months, the strong performance of both the stock and bond
markets more than compensated for the lackluster results of 1994, when stocks
struggled to stay even and bonds had their worst year since 1926.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
S&P 500 INDEX* MSCI EAFE (INTERNATIONAL)* MERRILL LYNCH INDEX*
<S> <C> <C> <C>
Sep-94 -2.44% -3.15% -2.045%
Oct-94 -0.24% 0.08% -2.486%
Nov-94 -3.88% -4.74% -2.717%
Dec-94 -2.45% -4.14% -1.772%
Jan-95 0.07% -7.82% 0.447%
Feb-95 3.98% -8.08% 2.274%
Mar-95 7.04% -2.35% 3.942%
Apr-95 10.19% 1.32% 5.637%
May-95 14.60% 0.12% 11.020%
Jun-95 17.26% -1.65% 11.978%
Jul-95 21.15% 4.48% 11.196%
Aug-95 21.45% 0.50% 12.606%
</TABLE>
SOURCE: BLOOMBERG FINANCIAL SERVICES
It now appears that the U.S. economy has reached the long-discussed "soft
landing." The term "soft landing" is often used to describe an economy slowing
sufficiently to keep inflation in check, but not stalling into a recession.
While the market continues to reach new highs, some investors are tempted to
try their hands at "market timing." It seldom works and shareholders are best
served by simply focusing on their long-term objectives. We feel that through
careful security selection, opportunities still exist for growth to occur.
Internationally, we see good opportunities in markets such as Southeast Asia,
and in certain Latin American countries.
Long term, we believe the market holds opportunity for shareholders that have
the discipline to demand value as well as strong growth. The performance of our
Portfolios has been aided by several sectors
4
<PAGE>
including the Technology and Finance areas. We are now looking for value in the
stocks of laggard groups such as Retail, Energy and Insurance.
Please read the interviews with our portfolio managers and their discussions
of their investment strategies over the past fiscal year ended August 31st. If
you have any questions, please call us at 800-877-9700. As always, we remain
committed to serving your investment needs.
Sincerely,
/s/ Stanley Egener
Stanley Egener
Chairman of the Board
Neuberger&Berman Equity Funds
*The S&P "500" Index is an unmanaged index generally considered to be
representative of U.S. stock market activity.
The MSCI EAFE Index is an unmanaged index generally considered to be
representative of international stock market activity.
The Merrill Lynch 7-10 year Treasury Index is an unmanaged total return market
value index consisting of all coupon-bearing U.S. Treasury publicly placed debt
securities with maturities between 7 to 10 years.
Please note that indices do not take into account any fees or expenses of
investing in the individual securities that they track, and that individuals
cannot invest directly in any index. Data about these indices are prepared or
obtained by Neuberger&Berman Management Inc. and include reinvestment of all
dividends and capital gain distributions. Past performance does not guarantee
future results.
5
<PAGE>
PORTFOLIO MANAGER'S COMMENTARY
Neuberger&Berman
- ----------------------------------------------------------------------
International Fund
FELIX ROVELLI -- PORTFOLIO MANAGER
Q
WHAT FACTORS INFLUENCED YOUR PORTFOLIO'S PERFORMANCE DURING
THE PAST FISCAL YEAR?
A Our Portfolio performed well over the past year, as some
rationality returned to the international equity markets.
We entered the fiscal year with a moderate weighting in Japanese stocks (22%
vs. 48% for the EAFE Index), as we believed that the overvaluation of the yen
was leading the Japanese economy back into recession, and that earnings
estimates would have to be revised downwards drastically. We reduced our
exposure later in the year to around 11%, as this assumption proved correct.
The Nikkei dramatically declined from the 18,000 level to a low of 14,295 on
July 3, a level last seen in the summer of 1992. Since then, we have been
increasing our exposure to the technology and semiconductor area, so that our
current Japanese weighting stands at around 14%, as of August 31.
We have also increased our weighting in Europe from approximately 40% to 50%
of the Portfolio. European markets performed well, particularly the Nordic
countries, the Netherlands and Germany.
In Asia, outside of Japan, performances were more subdued. Hong Kong followed
Wall Street upwards, buoyed mostly by lower interest rates. We have kept our
emerging Asian markets allocation at about 20% of the total assets.
Finally, in Latin America the sky didn't fall. Argentina, while still not out
of danger, did not devalue its peso, and a run on the banks has been
successfully averted. Mexico's currency has found a stable level from which
the economy can start mending, while Chile's economy keeps on growing
unabated, with stocks at all time highs.
Currently, we believe that Argentina and Peru offer the best value. Mexico's
problems are not over, but certainly many companies that
6
<PAGE>
- ----------------------------------------------------------------------
International Fund (Cont'd)
are able to export their products have been able to weather the worst of the
storm. Chile's excellent performance leaves the market fairly valued, in our
opinion, while the jury is still out on Brazil's economy. Over the last 6
months we have increased our weightings in Latin America from 3% to 8% of
assets.
Looking forward, we believe a more benign interest rate environment around
the world should continue to sustain equity markets. The Japanese monetary
authorities seem to indicate they are finally planning some monetary stimulus
and a solution to the banks' bad debt problem. While official statements can
lead to temporary rallies, we believe there may be further disillusionment as
the magnitude of Japan's structural adjustments require more pain through
higher unemployment and opening to foreign competition. The hollowing out of
Japan is a long term structural issue that cannot be addressed by simple
discount rate cuts. Nevertheless, a number of companies that have invested in
global production and are technological leaders appear to be quite
attractively priced, especially if the yen strength were to moderate.
We believe the ongoing shift towards producing in Southeast Asia continues
unabated. The markets of Thailand, Malaysia and Indonesia have not performed
in line with their economic growth over the last 12 months, and we believe
these markets are well-positioned to make up the lost ground over the next
few months.
Q
WHAT ARE SOME EXAMPLES OF STOCKS THAT HAVE POSITIVELY
AFFECTED THE PORTFOLIO'S PERFORMANCE?
A Our approach, which is to try and discover value around the
world, often leads us to invest in countries that are
slightly off the beaten path, and to companies which may not
be easily recognized.
One company that represents an excellent example of this investment strategy
and that has performed extremely well is Austria Micro Systems. The company
is a leading supplier of logic chips to
7
<PAGE>
PORTFOLIO MANAGER'S COMMENTARY
Neuberger&Berman
- ----------------------------------------------------------------------
International Fund (Cont'd)
the European cellular and automotive industry, and is still a relatively
unknown company with excellent fundamentals. It actually came to our
attention because it is a supplier to Nokia of Finland, another of our best
performing holdings, and today a much better known name by American
investors.
Another stock that has performed well is Thai Farmers Bank, a high quality
company and a financial leader in Thailand, a country whose economy is
growing at a buoyant 7% rate. In addition, the Bank is one of the largest
mutual fund managers in Thailand, and is investing heavily in fee-based
businesses. The popularity of these products has contributed to a healthy
growth in the Bank's earnings, up 31% in 1994.
Q
WHAT ARE SOME FACTORS THAT HAVE NEGATIVELY AFFECTED
YOUR PORTFOLIO?
A The previously mentioned devaluation of the Mexican peso,
severely hurt our limited Mexican exposure. Unfortunately,
extreme pessimism spread to include, not only Mexico, but
all of Latin America and even many Asian markets. Our
investments in many of these markets have held back our
performance over the last few months.
8
<PAGE>
COMPARISON OF A $10,000 INVESTMENT
Neuberger&Berman August 31, 1995
- ----------------------------------------------------------------------
International Fund
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
AVERAGE ANNUAL International EAFE -Registered Trademark- Index
TOTAL RETURN*
<S> <C> <C>
1 Year +2.60% +0.79%
Life of Fund +6.02% +3.63%
</TABLE>
<TABLE>
<CAPTION>
International Fund EAFE -Registered Trademark- Index
<S> <C> <C>
10000 10000
8/31/94 10460 10360
8/31/95 10732 10442
</TABLE>
Neuberger&Berman Management Inc. voluntarily bears certain operating expenses
of International Fund in excess of 1.70% of average daily net assets. This
arrangement will be in effect until December 31, 1996. Absent such
reimbursement, the average annual total return of International Fund for the one
year ended 8/31/95 and for the period from 6/15/94 to 8/31/95 would have been
2.13% and 5.52%, respectively.
*"Total Return" is calculated including reinvestment of all income dividends and
capital gain distributions. Results represent past performance and do not
indicate future results. The value of an investment in the Fund and the return
on the investment both will fluctuate, and redemption proceeds may be higher or
lower than an investor's original cost.
The EAFE-Registered Trademark- Index, also known as the Morgan Stanley Capital
International Europe, Australia, Far East Index, is an unmanaged index of over
1,000 foreign stock prices. These data are derived by Neuberger&Berman
Management Inc. The index is translated into U.S. dollars and includes
reinvestment of all dividends and capital gain distributions. The risks involved
in seeking capital appreciation from investments principally in companies based
outside the United States are set forth in the prospectus. Please note that
indices do not take into account any fees and expenses of investing in the
individual securities that they track, and that individuals cannot invest
directly in any index.
9
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
Neuberger&Berman August 31, 1995
- ----------------------------------------------------------------------
International Fund
<TABLE>
<S> <C>
ASSETS
Investment in Portfolio, at value (Note A) $ 26,406,055
Deferred organization costs (Note A) 75,935
Receivable for Trust shares sold 21,999
-------------
26,503,989
-------------
LIABILITIES
Accrued expenses 47,031
Payable for Trust shares redeemed 10,980
Payable to administrator -- net (Note B) 10,342
-------------
68,353
-------------
NET ASSETS at value $ 26,435,636
-------------
NET ASSETS consist of:
Par value $ 2,471
Paid-in capital in excess of par value 24,907,883
Accumulated undistributed net investment
income 98,860
Accumulated net realized losses on
investment (1,253,377)
Net unrealized appreciation in value of
investment 2,679,799
-------------
NET ASSETS at value $ 26,435,636
-------------
SHARES OUTSTANDING
($.001 par value; unlimited
shares authorized) 2,470,967
-------------
NET ASSET VALUE, offering and redemption price per
share $10.70
-------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
10
<PAGE>
STATEMENT OF OPERATIONS
Neuberger&Berman For the Year Ended August 31, 1995
- ----------------------------------------------------------------------
International Fund
<TABLE>
<S> <C>
INVESTMENT INCOME
Investment income from Portfolio (Note A) $ 460,602
-----------
Expenses:
Administration fee (Note B) 122,725
Shareholder reports 56,976
Legal fees 22,111
Amortization of deferred organization and
initial offering expenses (Note A) 19,805
Registration and filing fees 31,839
Shareholder servicing agent fees 25,428
Custodian fees 10,000
Auditing fees 7,800
Trustees' fees and expenses 5,507
Service fees (Note B) 4,178
Miscellaneous 697
Expenses from Portfolio (Note A) 132,192
-----------
Total expenses 439,258
Deduct -- expenses reimbursed by
administrator (Note B) (116,746)
-----------
Total net expenses 322,512
-----------
Net investment income 138,090
-----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS, FOREIGN CURRENCY TRANSACTIONS, AND
FINANCIAL FUTURES CONTRACTS FROM PORTFOLIO (NOTE
A)
Net realized loss on investments (1,095,734)
Net realized gain on foreign currency
transactions 9,443
Net realized loss on financial futures
contracts (143,493)
Change in net unrealized appreciation of
investments 2,335,592
Net unrealized appreciation of financial
futures contracts 132,195
-----------
Net gain on investments, foreign currency
transactions,
and financial futures contracts from
Portfolio (Note A) 1,238,003
-----------
Net increase in net assets resulting from
operations $ 1,376,093
-----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
11
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Neuberger&Berman
- ----------------------------------------------------------------------
International Fund
<TABLE>
<CAPTION>
Period from
June 15,
1994
(Commencement
of
Year Operations)
Ended to
August 31, August 31,
1995 1994
--------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income $ 138,090 $ 4,902
Net realized loss on investments
sold, foreign
currency transactions, and
financial futures
contracts from Portfolio (Note A) (1,229,784) (14,460 )
Change in net unrealized
appreciation of
investments, financial futures
contracts, and
translation of assets and
liabilities in foreign
currencies from Portfolio (Note A) 2,467,787 212,012
--------------------------
Net increase in net assets resulting
from operations 1,376,093 202,454
--------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (53,265) --
--------------------------
FROM TRUST SHARE TRANSACTIONS:
Proceeds from shares sold 27,432,563 6,003,364
Proceeds from reinvestment of
dividends 48,345 --
Payments for shares redeemed (8,547,388) (26,530 )
--------------------------
Net increase from Trust share
transactions 18,933,520 5,976,834
--------------------------
NET INCREASE IN NET ASSETS 20,256,348 6,179,288
NET ASSETS:
Beginning of year 6,179,288 --
--------------------------
End of year $ 26,435,636 $6,179,288
--------------------------
Accumulated undistributed net
investment income
at end of year $ 98,860 $ 4,592
--------------------------
NUMBER OF TRUST SHARES:
Sold 2,705,301 593,306
Issued on reinvestment of dividends 4,883 --
Redeemed (829,932) (2,591 )
--------------------------
Net increase in shares outstanding 1,880,252 590,715
--------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
12
<PAGE>
NOTES TO FINANCIAL STATEMENTS
Neuberger&Berman August 31, 1995
- ----------------------------------------------------------------------
Equity Funds
NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
1) GENERAL: Neuberger&Berman International Fund (the "Fund") is a separate
series of Neuberger&Berman Equity Funds (the "Trust"), a Delaware business
trust organized pursuant to a Trust Instrument dated December 23, 1992. The
Trust is registered as a diversified, open-end management investment company
under the Investment Company Act of 1940, as amended (the "1940 Act") and its
shares are registered under the Securities Act of 1933, as amended (the "1933
Act"). The Fund had no operations until June 15, 1994 other than matters
relating to its organization and its registration as a diversified, open-end
management investment company under the 1940 Act and registration of its
shares under the 1933 Act and state law. The trustees of the Trust may
establish additional series or classes of shares without the approval of
shareholders.
The assets of each series belong only to that series, and the liabilities
of each series are borne solely by that series and no other.
The Fund seeks to achieve its investment objective by investing all of its
net investable assets in the International Portfolio (the "Portfolio") of
Global Managers Trust ("Managers Trust"), having the same investment
objective and policies as the Fund. The value of the Fund's investment in the
Portfolio reflects the Fund's proportionate interest in the net assets of the
Portfolio (100% at August 31, 1995). The performance of the Fund is directly
affected by the performance of the Portfolio. The financial statements of the
Portfolio, including the schedule of investments, are included elsewhere in
this report and should be read in conjunction with the Fund's financial
statements.
2) PORTFOLIO VALUATION: Investments in the Portfolio of Managers Trust are
valued by Managers Trust as indicated in the notes following the Portfolio's
schedule of investments.
3) FEDERAL INCOME TAXES: Each series of the Trust is treated as a separate
entity for Federal income tax purposes. It is the policy of the Fund to
continue to qualify as a regulated investment company 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 (after reduction for any amounts available for Federal
income tax purposes as capital loss carryforwards) sufficient to relieve it
from all, or substantially all, Federal income taxes. Accordingly, the Fund
paid no Federal income taxes and no provision for Federal income taxes was
required.
13
<PAGE>
4) DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS: The Fund earns income, net of
Portfolio expenses, daily on its investment in the Portfolio. Dividends and
net realized capital gains, if any, are normally distributed in December.
Income dividends and capital gain distributions to shareholders are recorded
on the ex-dividend date. To the extent that the Fund's net realized capital
gains, if any, can be offset by capital loss carryforwards, it is the policy
of the Fund not to distribute such gains.
The Fund distinguishes between dividends on a tax basis and a financial
reporting basis and only distributions in excess of tax basis earnings and
profits are reported in the financial statements as a return of capital.
Differences in the recognition or classification of income between the
financial statements and tax earnings and profits which result in temporary
over-distributions for financial statement purposes are classified as
distributions in excess of net investment income or accumulated net realized
gains.
5) ORGANIZATION EXPENSES: Expenses incurred by the Fund in connection with its
organization are being amortized on a straight-line basis over a five-year
period. At August 31, 1995, the unamortized balance of such expenses amounted
to $75,935.
6) EXPENSE ALLOCATION: The Fund bears all costs of operations. Expenses incurred
by the Trust with respect to any two or more Funds are allocated in
proportion to the net assets of such Funds, except where another more
appropriate allocation of expenses to each Fund can otherwise be made fairly.
Expenses directly attributable to a Fund are charged to that Fund.
7) OTHER: All net investment income and realized and unrealized capital gains
and losses of the Portfolio are allocated pro rata among its respective Funds
and any other investors in the Portfolio.
NOTE B -- ADMINISTRATION AND DISTRIBUTION FEES AND OTHER TRANSACTIONS
WITH AFFILIATES:
The Fund retains Neuberger&Berman Management Incorporated ("Management") as
its administrator under an Administration Agreement ("Agreement") dated as of
May 1, 1995. Pursuant to this Agreement the Fund pays Management an
administration fee at the annual rate of 0.67% (0.63% prior to May 1, 1995) of
the Fund's average daily net assets and indirectly pays for investment
management services through its investment in the Portfolio. (See Note B of
Notes to Financial Statements of the Portfolio.) The Agreement provides that if
with respect to any fiscal year of the Fund, its total operating expenses plus
its pro rata portion of the Portfolio's operating expenses (including the fees
payable to Management but excluding interest, taxes, brokerage commissions, and
extraordinary expenses) ("Operating Expenses") exceed the most restrictive of
the expense limitations imposed by securities laws of the states in which the
Fund's shares are qualified for sale, the administration fees for that fiscal
year will be reduced by the amount of such excess, provided that Management has
no obligation to reimburse the Fund for any such expenses that exceed the
administration
14
<PAGE>
fee. The most restrictive expense limitation to which the Fund is currently
subject is 2 1/2% of the first $30 million of average daily net assets, 2% of
the next $70 million of average daily net assets, and 1 1/2% of any additional
average daily net assets. No reduction in the administration fee as a result of
the state expense limitation was required for the year ended August 31, 1995.
In addition, Management has voluntarily undertaken to reimburse the Fund for
its Operating Expenses which exceed, in the aggregate, 1.70% per annum of the
Fund's average daily net assets during the period from June 15, 1994 to December
31, 1996 ("Fund Expense Limitation"). The Fund has in turn agreed to repay
Management through December 31, 1998, for the excess Operating Expenses
Management previously reimbursed to the Fund, so long as the Fund's annual
Operating Expenses during that period do not exceed the Fund Expense Limitation.
For the year ended August 31, 1995, Management reimbursed the Fund $116,746,
pursuant to this undertaking.
All of the capital stock of Management is owned by individuals who are also
general partners of Neuberger&Berman, L.P. ("Neuberger"), a member firm of The
New York Stock Exchange. Several individuals who are officers and/or trustees of
the Trust are also partners of Neuberger and/or officers and/or directors of
Management.
Under a service agreement, which was in effect through April 30, 1995, the
Fund had retained Management to provide certain shareholder, shareholder-related
and other services not furnished by the shareholder servicing agent. Pursuant to
the service agreement the Fund paid Management a monthly fee at the annual rate
of 0.04% of the average daily net assets of the Fund as compensation for such
services. For the period from September 1, 1994 to April 30, 1995, the Fund paid
$4,178 for such services. As of May 1, 1995, the service agreement and the
administration agreement were combined into a single agreement with a fee of
0.67%.
The Fund also has a distribution agreement with Management, which receives no
compensation therefor and no commissions for sales or redemptions of shares of
beneficial interest of the Fund.
NOTE C -- INVESTMENT TRANSACTIONS:
During the year ended August 31, 1995, additions and reductions in the Fund's
investment in the Portfolio amounted to $21,184,541 and $2,396,831,
respectively.
At August 31, 1995, the Portfolio's cost of investments for U.S. Federal
income tax purposes was $23,416,850. Gross unrealized appreciation of
investments was $3,325,213 and gross unrealized depreciation of investments was
$824,163, resulting in net unrealized appreciation of $2,501,050, based on cost
for U.S. Federal income tax purposes.
15
<PAGE>
NOTE D -- SUBSEQUENT EVENTS:
The trustees of the Trust have approved a new Administration Agreement,
effective November 1, 1995 or such later date as the Portfolio's proposed new
Investment Advisory Agreement and Administration Agreement becomes effective. As
compensation for its services under the proposed Administration Agreement, the
Fund would pay Management a fee at an annual rate of 0.26% of its average daily
net assets. The current Fund Expense Limitation will remain in place.
Notice to Shareholders (Unaudited)
Neuberger&Berman International Fund has elected to pass through to its
shareholders the credit for taxes paid to foreign countries. For the fiscal year
ended August 31, 1995 the Fund had $38,038 of such credits. In January 1996,
each shareholder will receive a 1995 Form 1099 which will provide specific
information for preparing tax returns.
16
<PAGE>
FINANCIAL HIGHLIGHTS
Neuberger&Berman
- --------------------------------------------------------------------------------
International Fund
The following table includes selected data for a share outstanding throughout
each year and other performance information derived from the Financial
Statements. The per share amounts and ratios which are shown reflect income and
expenses, including the Fund's proportionate share of the Portfolio's income and
expenses. It should be read in conjunction with the Portfolio's Financial
Statements and notes thereto.
<TABLE>
<CAPTION>
PERIOD FROM
YEAR ENDED JUNE 15,
AUGUST 31, 1994(1) TO
1995 AUGUST 31, 1994
------------------------------
<S> <C> <C>
Net Asset Value, Beginning of Year $ 10.46 $ 10.00
------------------------------
Income From Investment Operations
Net Investment Income .06 .01
Net Gains or Losses on Securities (both
realized and unrealized) .21 .45
------------------------------
Total From Investment Operations .27 .46
------------------------------
Less Distributions
Dividends (from net investment income) (.03) --
------------------------------
Net Asset Value, End of Year $ 10.70 $ 10.46
------------------------------
Total Return+ +2.60% +4.60%(2)
------------------------------
Ratios/Supplemental Data
Net Assets, End of Year (in millions) $ 26.4 $ 6.2
------------------------------
Ratio of Expenses to Average Net Assets(3) 1.70% 1.70%(4)
------------------------------
Ratio of Net Income to Average Net Assets(3) .73% .57%(4)
------------------------------
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS
17
<PAGE>
NOTES TO FINANCIAL HIGHLIGHTS
Neuberger&Berman August 31, 1995
- ----------------------------------------------------------------------
International Fund
1) The date investment operations commenced.
2) Not annualized.
3) After reimbursement of expenses by the administrator as described in Note B
of Notes to Financial Statements. Had the administrator not undertaken such
action the annualized ratios of expenses and net investment income (loss) to
average daily net assets would have been 2.31% and .12%, respectively, for
the year ended August 31, 1995 and 2.50% and (.23%), respectively, for the
period ended August 31, 1994.
4) Annualized.
+ Total return based on per share net asset value reflects the effects of
changes in net asset value on the performance of the Fund during each year,
and assumes dividends and capital gain distributions, if any, were reinvested.
Results represent past performance and do not guarantee future results.
Investment returns and principal may fluctuate and shares when redeemed may be
worth more or less than original cost. Total return would be lower if
Management and/or BNP-N&B Global Asset Management L.P. had not reimbursed
certain expenses.
18
<PAGE>
REPORT OF INDEPENDENT AUDITORS
To the Board of Trustees
Neuberger&Berman Equity Funds and Shareholders of Neuberger&Berman International
Fund
We have audited the accompanying statement of assets and liabilities of the
Neuberger&Berman International Fund, one of the series comprising Neuberger&
Berman Equity Funds (the "Trust"), as of August 31, 1995, the related statement
of operations for the year then ended, and the statement of changes in net
assets and the financial highlights for the year ended August 31, 1995 and the
period from June 15, 1994 (commencement of operations) to August 31, 1994. These
financial statements and financial highlights are the responsibility of the
Trust'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 in the United States. 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. 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
Neuberger&Berman International Fund at August 31, 1995, the results of its
operations for the year then ended, and the changes in its net assets and its
financial highlights for the year ended August 31, 1995 and the period from June
15, 1994 (commencement of operations) to August 31, 1994, in conformity with
generally accepted accounting principles in the United States.
[SIGNATURE]
/s/ ERNST & YOUNG LLP
Boston, Massachusetts
October 6, 1995
19
<PAGE>
SCHEDULE OF INVESTMENTS
- --------------------------------------------------------------------------------
International Portfolio
<TABLE>
<CAPTION>
TOP TEN EQUITY HOLDINGS
---------------------------------------------------------------------------------------------
HOLDING COUNTRY INDUSTRY PERCENTAGE
<C> <S> <C> <C> <C>
1. Tarkett AG Germany Consumer Goods & Services 2.4%
2. Austria Mikro Systeme International Austria Electronics 2.1%
3. Compania Peruana de Telefonos "B" Peru Telecommunications 1.8%
4. Philips Electronics Netherlands Electronics 1.5%
5. SAP AG (Pfd.) Germany Technology 1.4%
6. NEC Corp. Japan Electronics 1.4%
7. Kyocera Corp. Japan Electronics 1.3%
8. L.M. Ericsson Telephone ADR Sweden Telecommunications 1.3%
9. Tokyo Electron Japan Electronics 1.2%
10. Hunter Douglas Netherlands Building Materials 1.1%
</TABLE>
<TABLE>
<CAPTION>
Number Market
of Shares Value(1)
- ---------- -----------------
<C> <S> <C>
COMMON STOCKS (92.3%)
ARGENTINA (0.9%)
4,000 Buenos Aires Embotelladora ADR $ 95,000
2,000 Central Costanera ADR 51,540(2)
4,000 Telefonica de Argentina ADR 99,000
-----------------
245,540
-----------------
AUSTRALIA (1.4%)
10,274 Broken Hill Proprietary 149,078
5,000 News Corp. ADR 113,750
2,900 Westpac Banking ADR 54,375
13,000 Westpac Banking 48,868
-----------------
366,071
-----------------
AUSTRIA (2.1%)
3,200 Austria Mikro Systeme International 561,306
-----------------
BELGIUM (0.4%)
1,000 Barco Industries 107,479
-----------------
BRAZIL (0.8%)
9,666 Aracruz Celulose ADR 115,992
7,400 Rhodia-Ster S.A. GDR 99,900(2)
-----------------
215,892
-----------------
CHILE (1.3%)
19,000 Banco Osorno Y La Union ADR 282,625
1,500 Quimica Y Minera ADR 69,750
-----------------
352,375
-----------------
CHINA (0.2%)
149,000 Qingling Motors 38,977
-----------------
<CAPTION>
Number Market
of Shares Value(1)
- ---------- -----------------
<C> <S> <C>
DENMARK (0.6%)
6,000 Tele Danmark ADR $ 159,750
-----------------
FINLAND (2.2%)
9,000 Aamulehti
Yhtymae OY-II 168,220(2)
18,000 Kemira OY 141,551
3,000 Metra OY "B" 127,875
2,200 Nokia AB "A" 151,945
-----------------
589,591
-----------------
FRANCE (4.5%)
1,500 B.I.S. SA 139,423(3)
660 Bouygues 80,312
990 Chargeurs 214,253
976 Cie Generale des Eaux 103,291
800 Compagnie de Saint Gobain 101,629
2,600 Credit Local de France 220,025
650 Elf Gabon 100,480
900 PSA Peugeot Citroen 118,970
2,000 SGS Thomson Microelectronics 95,921(3)
-----------------
1,174,304
-----------------
GERMANY (4.9%)
400 Hoechst AG 96,327
527 Mannesmann AG 166,342
5,000 SGL Carbon 273,254(3)
25,000 Tarkett AG 637,138(2,3)
570 Thyssen AG 111,165(3)
-----------------
1,284,226
-----------------
HONG KONG (3.9%)
124,000 ASM Pacific Technology 114,533
150,000 First Pacific 155,988
</TABLE>
20
<PAGE>
August 31, 1995
- --------------------------------------------------------------------------------
International Portfolio (Cont'd)
<TABLE>
<CAPTION>
Number Market
of Shares Value(1)
- ---------- -----------------
<C> <S> <C>
11,200 HSBC Holdings PLC $ 150,471
34,000 Hutchison Whampoa 163,829
374,000 Manhattan Card 149,774
29,500 Swire Pacific "A" 221,031
45,000 Varitronix International 83,419
-----------------
1,039,045
-----------------
INDIA (0.7%)
6,000 Bajaj Auto GDR 180,780(2,3)
-----------------
INDONESIA (2.9%)
60,000 Bakrie & Brothers - Foreign 116,479
20,000 Hanjaya Mandala Sampoerna - Foreign 189,720
6,000 Indosat ADR 210,750
24,000 Kalbe Farma - Foreign 99,007
82,500 Matahari Putra Prima - Foreign 149,239
-----------------
765,195
-----------------
IRELAND (2.1%)
30,000 CRH PLC 207,784
15,136 Greencore Group PLC 113,937
44,000 Powerscreen International PLC 237,653
-----------------
559,374
-----------------
ISRAEL (0.4%)
3,000 Teva Pharmaceutical ADR 113,625
-----------------
ITALY (2.1%)
25,000 Fiat S.p.A. 91,775
21,000 Italcementi Fabbriche Riunite 146,802
90,000 Pirelli S.p.A. 124,623(3)
58,000 Telecom Italia 93,163
58,000 Telecom Italia Mobile 85,488(3)
-----------------
541,851
-----------------
JAPAN (14.3%)
10,000 Arcland Sakamoto 163,649
1,000 Autobacs Seven 103,304
4,000 Bandai Co. 145,239
4,000 Best Denki 62,596
10,000 Calsonic Corp. 79,472
5,000 Fanuc 228,598
5,000 Hitachi Ltd. 54,720
2,000 Ito Yokado 106,577
9,000 JACCS Co. 83,952
1,000 Japan Associated Finance 103,304
4,000 Kyocera Corp. 353,483
6,000 Matsushita Electric Industrial 93,894
5,000 Mitsubishi Trust & Banking $ 83,359
28,000 NEC Corp. 366,575
15,000 Nikon Corp. 205,584
2,400 Nissen Co. 69,960
2,000 Sega Enterprises 86,939
10,000 77 Bank 97,576
8,000 Sharp Corp. 113,736
7,000 Shin-Etsu Chemical 139,613
3,000 Shinkawa 112,304
2,000 SMC Corp. 121,305
1,800 Sony Corp. 98,312
10,000 Tachi-S 91,644
8,000 Tokyo Electron 322,389
4,000 Tokyo Ohka Kogyo 128,465
2,000 Towa Pharmaceutical 105,349
1,000 Zenrin Co. 59,323
-----------------
3,781,221
-----------------
KOREA (3.1%)
3,550 Daelim Industrial 77,593(3)
852 Daelim Industrial New 16,529(3)
2,400 Inchon Iron & Steel 88,463(3)
10 Korea 1990 Trust IDR 43,000(3)
2,200 Korea Electric Power 77,393(3)
2,900 L.G. Electronics 89,640(3)
169 L.G. Electronics New 1,306(3)
1,100 Samsung Electronics 199,172(3)
148 Samsung Electronics New 26,415(3)
15 Samsung Electronics New 3 2,580(3)
1,000 Shinsegae Department Store 69,322(3)
302 Shinsegae New 19,529(3)
2,400 Yukong Ltd. 86,912
287 Yukong Ltd. New 10,393
-----------------
808,247
-----------------
MALAYSIA (3.0%)
24,000 Ekran 72,144
16,000 Genting 141,723
36,000 Land & General Holdings 115,431
21,000 Malayan Banking 172,545
34,000 Sime Darby 86,533
12,000 Telekom Malaysia 84,168
20,000 YTL Corp. 109,820(2)
-----------------
782,364
-----------------
MEXICO (2.6%)
10,000 ALFA, SA "A" 137,052
40,000 Cementos de Mexico "B" 183,904(3)
5,000 Coca-Cola FEMSA ADR 115,625
</TABLE>
21
<PAGE>
SCHEDULE OF INVESTMENTS
- ----------------------------------------------------------
International Portfolio (Cont'd)
<TABLE>
<CAPTION>
Number Market
of Shares Value(1)
- ---------- -----------------
<C> <S> <C>
50,000 Fomento Economico Mexicano "B" $ 137,849
300,000 Grupo Financiero Bancomer "B" 120,000(3)
-----------------
694,430
-----------------
NETHERLANDS (5.2%)
2,000 Akzo Nobel ADR 118,000
12,520 Elsevier N.V. 158,356
2,537 Getronics N.V. 108,762
6,000 Hunter Douglas 301,368
8,750 Philips Electronics 392,673
8,210 Royal PTT Nederland 283,069
-----------------
1,362,228
-----------------
NEW ZEALAND (0.7%)
2,500 Fletcher Challenge ADR 68,125
2,000 Telecom of New Zealand ADR 127,750
-----------------
195,875
-----------------
NORWAY (2.4%)
2,000 Hafslund Nycomed ADR 48,000
3,800 Kvaerner AS "B" Free 140,949
3,800 Nera AS 123,479
4,000 Norske Skogindustrier "A" 125,614
6,000 Petroleum Geo-Services ADR 153,750(3)
2,000 Scandinavian Broadcasting System 54,250(3)
-----------------
646,042
-----------------
PERU (2.0%)
8,247 Banco Wiese ADR 57,729
243,000 Compania Peruana de Telefonos "B" 475,388(3)
-----------------
533,117
-----------------
PHILIPPINES (2.1%)
15,000 Benpres Holdings GDR 105,000(2,3)
246,000 International Container Terminal
Services 154,224(3)
270,000 JG Summit Holdings "A" 82,292
690,300 SM Prime Holdings 221,045(3)
-----------------
562,561
-----------------
SINGAPORE (1.4%)
44,000 Elec & Eltek International 87,560
11,000 Keppel Corp. 88,235
6,000 Singapore Press Holdings 82,747
12,000 United Overseas Bank - Foreign 103,856
-----------------
362,398
-----------------
SPAIN (1.5%)
770 Acerinox SA $ 98,046
7,000 Amper SA 86,230(3)
1,300 Empresa Nacional de Electricidad ADR 67,275
3,500 Telefonica de Espana ADR 142,187
-----------------
393,738
-----------------
SWEDEN (4.8%)
800 Asea ADR 70,700
9,200 Astra "B" 298,824
4,000 Atlas Copco "A" 62,221
2,000 Autoliv 120,878
3,000 Elekta Instrument "B" 115,944
16,000 L.M. Ericsson Telephone ADR 342,000
5,000 SKF ADR 101,875
4,000 WM-Data "B" 142,532
-----------------
1,254,974
-----------------
SWITZERLAND (3.3%)
100 Ascom Holding 113,278(3)
360 Holderbank Financiere Glaris "B" 282,324
28 Roche Holding 187,519
240 Sandoz AG 173,079
1,000 Von Moos Holding 124,481(3)
-----------------
880,681
-----------------
TAIWAN (0.7%)
2,300 Asia Cement GDS 45,149(3)
4,000 China Steel GDR 78,000
6,000 R O C Taiwan Fund 62,250(3)
-----------------
185,399
-----------------
THAILAND (2.4%)
6,200 Bangkok Bank - Foreign 69,274
43,500 Sahaviriya Steel Industry - Foreign 86,792(3)
3,700 Shinawatra Computer - Foreign 85,339
800 Siam Cement - Foreign 54,525
18,800 TelecomAsia Corp. - Foreign 60,391(3)
2,000 Thai-Euro Fund IDR 67,000(3)
12,000 Thai Farmers Bank - Foreign 116,840
1 The Thailand International Fund 31,500(3)
4,000 United Communications - Foreign 54,270
-----------------
625,931
-----------------
</TABLE>
22
<PAGE>
August 31, 1995
- --------------------------------------------------------------------------------
International Portfolio (Cont'd)
<TABLE>
<CAPTION>
Number Market
of Shares Value(1)
- ---------- -----------------
<C> <S> <C>
UNITED KINGDOM (11.4%)
1,000 British Petroleum ADR $ 90,125
10,500 Cable & Wireless ADR 206,063
10,250 Carlton Communications PLC 165,451
40,000 Dixons Group PLC 209,530
10,500 GKN PLC 127,359
62,000 McBride PLC 202,080(3)
3,500 Smithkline Beecham ADR 156,625
20,100 Southern Electric PLC 246,765
10,000 Tele-Communications International 156,250(3)
9,000 TeleWest Communications ADR 217,125(3)
8,500 Thorn EMI PLC 194,921
109,237 TLG PLC 288,224(2)
35,186 Tomkins PLC 136,255
12,000 Videotron Holdings ADR 175,500(3)
2,200 Vodafone Group ADR 92,125
75,000 WPP Group PLC 189,741
3,000 Zeneca Group ADR 155,250
-----------------
3,009,389
-----------------
TOTAL COMMON STOCKS (COST $22,225,217) 24,373,976
-----------------
PREFERRED STOCKS (2.4%)
300 Bayerische Motoren Werke, Germany 117,956
2,000 Nokia Corp. ADR, Finland 138,750
2,500 SAP AG, Germany 370,017
-----------------
TOTAL PREFERRED STOCKS (COST $319,355) 626,723
-----------------
WARRANTS (0.4%)
1,000 Bank Julius Baer - W95 Merck AG,
Switzerland, expire 9/20/95 103,735(3)
1,800 Holderbank CW95, Switzerland, expire
12/20/95 $ 2,241(3)
400 Thai Euro Fund, Thailand, expire 3/31/98 1,333(3)
-----------------
TOTAL WARRANTS (COST $80,618) 107,309
-----------------
RIGHTS (0.0%)
770 Acerinox SA, Spain, expire 9/15/95 (COST
$0) 9,639(3)
-----------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount
- ----------
<C> <S> <C>
CONVERTIBLE BONDS (0.2%)
$ 36,000 United Micro Electronics, Cv. Unsub.
Notes, 1.25%, due 6/8/04 (COST $47,160) 60,210(2)
-----------------
U.S. TREASURY SECURITIES (2.8%)
$ 745,000 U.S. Treasury Bills,
5.15% - 5.36%,
due 9/7/95 - 10/26/95
(COST $740,043) 740,043(4)
-----------------
TOTAL INVESTMENTS (98.1%)
(COST $23,412,393) 25,917,900
Cash, receivables and other assets, less
liabilities (1.9%) 488,157
-----------------
TOTAL NET ASSETS (100.0%) $ 26,406,057
-----------------
</TABLE>
23
<PAGE>
NOTES TO SCHEDULE OF INVESTMENTS
August 31, 1995
- ----------------------------------------------------------------------
International Portfolio
1) Investment securities of the Portfolio are valued at the latest sales price;
securities for which no sales were reported, unless otherwise noted, are
valued at the last available bid price. Foreign security prices are furnished
by independent quotation services expressed in local currency values. Foreign
securities are translated from the local currency into U.S. dollars using
current exchange rates.
2) Security exempt from registration under the Securities Act of 1933. These
securities may be resold in transactions exempt from registration, normally
to qualified institutional buyers under Rule 144A. At August 31, 1995, these
securities amounted to $1,700,832 or 6.4% of net assets.
3) Non-income producing security.
4) At cost, which approximates market value.
SEE NOTES TO FINANCIAL STATEMENTS
24
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
August 31, 1995
- ----------------------------------------------------------------------
International Portfolio
<TABLE>
<S> <C>
ASSETS
Investments in securities, at market value*
(Note A) -- see Schedule of Investments $ 25,917,900
Cash 6,274
Receivable for securities sold 924,209
Dividends and interest receivable 61,826
Deferred organization costs (Note A) 44,086
Net receivable for foreign currency exchange
contracts sold (Note C) 42,999
Receivable from investment adviser -- net
(Note B) 2,525
-------------
26,999,819
-------------
LIABILITIES
Payable for securities purchased 528,254
Accrued expenses 55,516
Payable to administrator (Note B) 8,492
Payable for variation margin (Note A) 1,500
-------------
593,762
-------------
NET ASSETS APPLICABLE TO INVESTORS' BENEFICIAL
INTERESTS $ 26,406,057
-------------
NET ASSETS consist of:
Paid-in capital $ 23,726,258
Net unrealized appreciation in value of
investments, foreign currency contracts,
financial futures contracts, and
translation of assets and liabilities in
foreign currencies 2,679,799
-------------
NET ASSETS $ 26,406,057
-------------
*Cost of investments $ 23,412,393
-------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
25
<PAGE>
STATEMENT OF OPERATIONS
For the Year Ended August 31, 1995
- ----------------------------------------------------------------------
International Portfolio
<TABLE>
<S> <C>
INVESTMENT INCOME
Income:
Dividend income $ 332,656
Interest income 165,984
Foreign taxes withheld (Note A) (38,038)
-----------
Total income 460,602
-----------
Expenses:
Administration fee (Note B) 100,000
Investment advisory fee (Note B) 94,422
Custodian fees 83,991
Legal fees 61,580
Auditing fees 30,000
Trustees' fees and expenses 28,021
Amortization of deferred organization and
initial offering expenses (Note A) 11,637
Accounting fees 10,000
Miscellaneous 2,903
-----------
Total expenses 422,554
Deduct -- expenses reimbursed by investment
adviser (Note B) (290,362)
-----------
Total net expenses 132,192
-----------
Net investment income 328,410
-----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS, FOREIGN CURRENCY TRANSACTIONS, AND
FINANCIAL FUTURES CONTRACTS
Net realized loss on investments sold (1,095,734)
Net realized gain on foreign currency
transactions (Note A) 9,443
Net realized loss on financial futures
contracts (Note A) (143,493)
Change in net unrealized appreciation of
investments and translation of assets and
liabilities in foreign currencies 2,335,592
Net unrealized appreciation of financial
futures contracts (Note A) 132,195
-----------
Net gain on investments, foreign currency
transactions, and financial futures
contracts 1,238,003
-----------
Net increase in net assets resulting from
operations $ 1,566,413
-----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
26
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
- ----------------------------------------------------------------------
International Portfolio
<TABLE>
<CAPTION>
Period from
June 15,
1994
(Commencement
of
Operations)
Year Ended to
August 31, August 31,
1995 1994
--------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income $ 328,410 $ 13,612
Net realized loss on investments
sold, foreign currency
transactions, and financial
futures contracts (1,229,784) (14,460 )
Change in net unrealized
appreciation of investments,
financial futures contracts, and
translation of assets and
liabilities in foreign currencies 2,467,787 212,012
--------------------------
Net increase in net assets resulting
from operations 1,566,413 211,164
--------------------------
TRANSACTIONS IN INVESTORS' BENEFICIAL
INTERESTS:
Additions 21,184,541 5,844,715
Reductions (2,396,831) (3,945 )
--------------------------
Net increase in net assets resulting
from transactions in
investors' beneficial interests 18,787,710 5,840,770
--------------------------
NET INCREASE IN NET ASSETS 20,354,123 6,051,934
NET ASSETS:
Beginning of year 6,051,934 --
--------------------------
End of year $ 26,406,057 $6,051,934
--------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
27
<PAGE>
NOTES TO FINANCIAL STATEMENTS
August 31, 1995
- ----------------------------------------------------------------------
Global Managers Trust
NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
1) GENERAL: International Portfolio (the "Portfolio") is a separate series of
Global Managers Trust ("Managers Trust"), a New York common law trust
organized as of March 18, 1994, with its principal office in the Cayman
Islands. Managers Trust is registered as a diversified, open-end management
investment company under the Investment Company Act of 1940, as amended.
Managers Trust currently has only one portfolio. The assets of the Portfolio
belong only to the Portfolio, and the liabilities of the Portfolio are borne
solely by the Portfolio and no other.
2) PORTFOLIO VALUATION: Investments are valued as indicated in the notes
following the Portfolio's schedule of investments.
3) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are
recorded on a trade date basis. Dividend income is recorded on the
ex-dividend date or, for certain foreign dividends, as soon as the Portfolio
becomes aware of the dividends, and interest income, including accretion of
discount on short-term investments (adjusted for original issue discount,
where applicable), is recorded on the accrual basis. Realized gains and
losses from securities and foreign currency transactions are recorded on the
basis of identified cost.
4) FOREIGN CURRENCY TRANSLATION: The accounting records of the Portfolio are
maintained in U.S. dollars. Foreign currency amounts are translated into
U.S. dollars at the current rate of exchange of such currency against the
U.S. dollar to determine the value of investments, other assets and
liabilities. Purchase and sale prices of securities, and income and expenses
are translated into U.S. dollars at the prevailing rate of exchange on the
respective dates of such transactions.
5) FORWARD FOREIGN CURRENCY CONTRACTS: The Portfolio may enter into forward
foreign currency contracts ("contracts") in connection with planned
purchases or sales of securities, to hedge the U.S. dollar value of
portfolio securities denominated in a foreign currency, or to increase or
decrease its exposure to a currency other than U.S. dollars. The gain or
loss arising from the difference between the original contract and the
closing of such contract is included in net realized gains on foreign
currency transactions. Fluctuations in the value of forward exchange
currency contracts are recorded for financial reporting purposes as
unrealized gains or losses by the Portfolio. The Portfolio has no specific
limitation on the percentage of assets which may be committed to these types
of contracts. The Portfolio could be exposed to risks if a counterparty to
the contracts were unable
28
<PAGE>
to meet the terms of its contracts or if the value of the foreign currency
changes unfavorably. The U.S. dollar value of foreign currency underlying
all contractual commitments held by the Portfolio is determined using
forward currency exchange rates supplied by an independent pricing service.
6) TAXES: There is, at present, no direct taxation in the Cayman Islands, and
therefore interest, dividends and capital gains derived by Managers Trust
are not subject to taxes in that jurisdiction.
7) FOREIGN TAXES: Foreign taxes withheld represent amounts withheld by foreign
tax authorities, net of refunds recoverable.
8) ORGANIZATION EXPENSES: Expenses incurred by the Portfolio in connection with
its organization are being amortized by the Portfolio on a straight-line
basis over a five-year period. At August 31, 1995, the unamortized balance
of such expenses amounted to $44,086.
9) EXPENSE ALLOCATION: The Portfolio bears all costs of operations. Expenses
incurred by Managers Trust with respect to any two or more Portfolios are
allocated in proportion to the net assets of such Portfolios, except where
another more appropriate allocation of expenses to each Portfolio can
otherwise be made fairly. Expenses directly attributable to a Portfolio are
charged to that Portfolio.
10) FINANCIAL FUTURES CONTRACTS: The Portfolio may buy and sell financial
futures contracts for hedging and non-hedging purposes. At the time the
Porfolio enters into a financial futures contract, it is required to deposit
with its custodian a specified amount of cash or U.S. government securities,
known as "initial margin," ranging upward from 1.1% of the value of the
financial futures contract being traded. Each day, the futures contract is
valued at the official settlement price of the board of trade or U.S.
commodity exchange on which such futures contract is traded. Subsequent
payments, known as "variation margin," to and from the broker are made on a
daily basis as the market price of the financial futures contract
fluctuates. Daily variation margin adjustments, arising from this "mark to
market," are recorded by the Portfolio as unrealized gains or losses.
Although some financial futures contracts by their terms call for actual
delivery or acceptance of financial instruments, in most cases the contracts
are closed out prior to delivery by offsetting purchases or sales of
matching financial futures contracts. When the contracts are closed, the
Portfolio recognizes a gain or loss. Risks of entering into futures
contracts include the possibility that there may be an illiquid market
and/or that a change in the value of the contract may not correlate with
changes in the value of the underlying securities.
29
<PAGE>
At August 31, 1995, open positions in financial futures contracts for the
Portfolio were as follows:
<TABLE>
<CAPTION>
UNREALIZED
EXPIRATION OPEN CONTRACTS POSITION APPRECIATION
- ------------------------------------------------------------------------------
<S> <C> <C> <C>
September 1995 12 Nikkei Futures Long $132,195
</TABLE>
At August 31, 1995, the Portfolio had deposited cash in a segregated
account with the broker in the amount of $125,000 to cover margin
requirements on open financial futures contracts.
NOTE B -- ADMINISTRATION AND ADVISORY FEES AND OTHER TRANSACTIONS WITH
AFFILIATES:
The Portfolio retains BNP-N&B Global Asset Management L.P. ("BNP-N&B
Global"), a partnership jointly owned by Banque Nationale de Paris ("BNP") and
Neuberger&Berman, L.P. ("Neuberger"), as its investment adviser under an
Investment Advisory Agreement dated as of June 15, 1994. For such investment
advisory services, the Portfolio pays BNP-N&B Global a fee at the annual rate of
0.50% of the first $250 million of the Portfolio's average daily net assets;
0.475% of the next $250 million; 0.45% of the next $250 million; and 0.425% of
average daily net assets in excess of $750 million. The Portfolio retains
Neuberger&Berman Management Incorporated ("Management") as its administrator
under an Administration Agreement dated as of June 15, 1994. For such
administrative services, the Portfolio pays Management a fee at the annual rate
of 0.10% of the first $250 million of the Portfolio's average daily net assets;
0.08% of the next $250 million; 0.06% of the next $250 million; and 0.04% of
average daily net assets in excess of $750 million. The minimum administration
fee is $100,000 per annum.
BNP-N&B Global has voluntarily undertaken to reimburse the Portfolio for its
operating expenses (excluding interest, taxes, brokerage commissions, and
extraordinary expenses) ("Operating Expenses") that exceed 0.70% per annum of
the Portfolio's average daily net assets during the period from June 15, 1994 to
December 31, 1996. The Portfolio has in turn agreed to repay BNP-N&B Global
through December 31, 1998, for the excess Operating Expenses BNP-N&B Global
previously reimbursed to the Portfolio, so long as the Neuberger&Berman
International Fund's annual Operating Expenses during that period do not exceed
its expense limitation. During the year ended August 31, 1995, BNP-N&B Global
reimbursed the Portfolio $290,362 pursuant to this undertaking.
All of the capital stock of Management is owned by individuals who are also
general partners of Neuberger, a member firm of The New York Stock Exchange. One
individual who is an officer and trustee of Managers Trust is also a partner of
Neuberger and an officer and director of Management.
30
<PAGE>
NOTE C -- SECURITIES TRANSACTIONS:
During the year ended August 31, 1995, there were purchase and sale
transactions (excluding short-term securities, forward foreign currency
contracts, and financial futures contracts) of $24,947,019 and $6,650,211,
respectively. Brokerage commissions on securities transactions amounted to
$128,324, of which Neuberger, BNP and other brokers received $4,110, $0, and
$124,214, respectively.
At August 31, 1995, the Portfolio had entered into various contracts to
deliver currencies at specified future dates. Open contracts were as follows:
<TABLE>
<CAPTION>
IN NET UNREALIZED
CONTRACTS EXCHANGE SETTLEMENT APPRECIATION
SALES TO DELIVER FOR DATE VALUE (DEPRECIATION)
- ---------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
GBP 638,529 $1,000,000 9/15/95 $ 990,368 $ 9,632
FRF 4,919,700 1,013,138 11/9/95 974,607 38,531
DM 1,433,800 974,844 11/22/95 980,008 (5,164 )
---------- ---------------------------
$2,987,982 $2,944,983 $ 42,999
---------- ---------------------------
</TABLE>
NOTE D -- SUBSEQUENT EVENTS:
BNP-N&B Global has advised Management that it intends to terminate the
Investment Advisory Agreement effective November 1, 1995. At a special meeting
on August 8, 1995, the trustees of Managers Trust have approved Management as
the investment manager of the Portfolio and Neuberger as the sub-adviser to the
Portfolio, effective November 1, 1995 or such later date as the actions are
approved by the interestholders of Managers Trust. As full compensation for the
proposed new services provided under the Investment Advisory Agreement and
Administration Agreement ("Management Agreement"), the Portfolio would pay
Management a fee at the annual rate of .85% of the first $250 million of average
daily net assets; .825% of the next $250 million; .80% of the next $250 million;
.775% of the next $250 million; .75% of the next $500 million; and .725% of
average daily net assets in excess of $1.5 billion. In addition, Management has
notified the Portfolio that it intends to terminate the Administration Agreement
effective November 1, 1995. Necessary administration services would be provided
to the Portfolio by Management under the proposed new Management Agreement.
Under the new Administration Agreement, the current expense limitation will be
terminated.
31
<PAGE>
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
International Portfolio
<TABLE>
<CAPTION>
PERIOD FROM
JUNE 15, 1994
(COMMENCEMENT
OF
YEAR ENDED OPERATIONS) TO
AUGUST 31, AUGUST 31,
1995 1994
-----------------------------
<S> <C> <C>
RATIOS TO AVERAGE NET ASSETS:
Expenses(1) .70% .70%(2)
-----------------------------
Net investment income(1) 1.74% 1.63%(2)
-----------------------------
Portfolio Turnover Rate 41% 5%
-----------------------------
Net Assets, End of Year (in millions) $26.4 $6.1
-----------------------------
</TABLE>
1) After reimbursement of expenses by the investment adviser as described in
Note B of Notes to Financial Statements. Had the investment adviser not
undertaken such action the annualized ratios of expenses and net investment
income (loss) to average daily net assets would have been 2.24% and .20%,
respectively, for the year ended August 31, 1995, and 2.50% and (.17%),
respectively, for the period ended August 31, 1994.
2) Annualized.
32
<PAGE>
REPORT OF INDEPENDENT AUDITORS
To the Board of Trustees
Global Managers Trust and Owners of Beneficial Interest of International
Portfolio
We have audited the accompanying statement of assets and liabilities,
including the schedule of investments, of the International Portfolio, a series
of Global Managers Trust (the "Trust"), as of August 31, 1995, and the related
statements of operations for the year then ended and changes in net assets and
financial highlights for the year then ended and the period from June 15, 1994
(commencement of operations) to August 31, 1994. These financial statements and
financial highlights are the responsibility of the Trust'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 in the United States. 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 August 31, 1995, by correspondence with the custodian and brokers or
other appropriate auditing procedures where replies from brokers were not
received. 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
International Portfolio at August 31, 1995, the results of its operations for
the year then ended, the changes in its net assets and its financial highlights
for the year then ended and the period from June 15, 1994 (commencement of
operations) to August 31, 1994, in conformity with accounting principles
generally accepted in the United States.
[SIGNATURE]
/s/ ERNST & YOUNG
Grand Cayman,
Cayman Islands
October 6, 1995
33
<PAGE>
DIRECTORY
DIRECTORY
INVESTMENT ADVISER
BNP-N&B Global Asset
Management L.P.
605 Third Avenue, 39th Floor
New York, NY 10158-3698
212-476-5529
ADMINISTRATOR AND DISTRIBUTOR
Neuberger&Berman
Management Inc.
605 Third Avenue, 2nd Floor
New York, NY 10158-0180
800-877-9700
Institutional Services
800-366-6264
LEGAL COUNSEL
Kirkpatrick & Lockhart LLP
1800 M Street, NW
Washington, DC 20036-5891
CUSTODIAN AND SHAREHOLDER
SERVICING AGENT
State Street Bank and
Trust Company
225 Franklin Street
Boston, MA 02110
Address correspondence to:
Neuberger&Berman Funds
Boston Service Center
P.O. Box 8403
Boston, MA 02266-8403
800-225-1596
INDEPENDENT AUDITORS
Ernst & Young LLP
200 Clarendon Street
Boston, MA 02116
Ernst & Young
One Capital Place
Shedden Road
George Town
Grand Cayman, Cayman Islands
Neuberger&Berman Management Inc. and Neuberger&Berman International Fund are
service marks of
Neuberger&Berman Management Inc.
- -C- 1995 Neuberger&Berman Management Inc.
34
<PAGE>
OFFICERS AND TRUSTEES
NEUBERGER&BERMAN
EQUITY FUNDS
Stanley Egener
CHAIRMAN OF THE BOARD
AND TRUSTEE
Lawrence Zicklin
PRESIDENT AND TRUSTEE
Faith Colish
TRUSTEE
Donald M. Cox
TRUSTEE
Alan R. Gruber
TRUSTEE
Howard A. Mileaf
TRUSTEE
Edward I. O'Brien
TRUSTEE
John T. Patterson, Jr.
TRUSTEE
John P. Rosenthal
TRUSTEE
Cornelius T. Ryan
TRUSTEE
Gustave H. Shubert
TRUSTEE
Daniel J. Sullivan
VICE PRESIDENT
Michael J. Weiner
VICE PRESIDENT
Richard Russell
TREASURER
Claudia A. Brandon
SECRETARY
Stacy Cooper-Shugrue
ASSISTANT SECRETARY
C. Carl Randolph
ASSISTANT SECRETARY
GLOBAL MANAGERS
TRUST
Stanley Egener
CHAIRMAN OF THE BOARD
AND TRUSTEE
Lawrence Zicklin
PRESIDENT
Howard A. Mileaf
TRUSTEE
John T. Patterson, Jr.
TRUSTEE
John P. Rosenthal
TRUSTEE
Daniel J. Sullivan
VICE PRESIDENT
Michael J. Weiner
VICE PRESIDENT
Richard Russell
TREASURER
Jacqueline Henning
ASSISTANT TREASURER
Claudia A. Brandon
SECRETARY
Stacy Cooper-Shugrue
ASSISTANT SECRETARY
Lenore Joan McCabe
ASSISTANT SECRETARY
C. Carl Randolph
ASSISTANT SECRETARY
35
<PAGE>
Neuberger&Berman Management Inc.
605 THIRD AVENUE 2ND FLOOR
NEW YORK, NY 10158-0180
SHAREHOLDER SERVICES
800.877.9700
INSTITUTIONAL SERVICES
800.366.6264
Statistics and projections in this report are derived from sources
deemed to be reliable but cannot be regarded as a representation of
future results of the Fund. This report is prepared for the general infor-
mation of shareholders and is not an offer of shares of the Fund.
Shares are sold only through the currently effective prospectus, which
must precede or accompany this report.
PRINTED ON RECYCLED PAPER
(recycle logo) NBITAR040895
WITH SOY BASED INKS
<PAGE>
