<PAGE>
AMERICAN DIVERSIFIED FUNDS, INC.
AMERICAN DIVERSIFIED GLOBAL VALUE FUND
May 25, 1999
Dear Shareholders:
We are pleased to present this Annual Report, along with an update on the future
of the American Diversified Global Value Fund. The Board of Directors of the
American Diversified Global Value Fund (the "Fund") has voted to approve a
tax-free reorganization of the American Diversified Global Value Fund. The
Board, after careful deliberations, has determined that this transaction is in
the best interest of the Fund and its shareholders, and will recommend to
shareholders that the Fund be brought under the umbrella of the Orbitex Group of
Funds through a merger with the Orbitex Growth Fund. The Orbitex Growth Fund
seeks long-term growth of capital through investments in global equities and
debt instruments, selected on the basis of strong value and growth
characteristics. The Orbitex funds are managed by Orbitex Management, Inc., an
experienced global investment advisor focused on specialty equity markets.
Orbitex and its affiliates have more than $1.2 billion under management.
These actions require a shareholder vote. Proxy statements regarding this change
will be mailed to shareholders within 60 days. Orbitex Management, Inc. has
agreed to serve as the Fund's investment advisor during this interim period
replacing American Diversified Asset Management, Inc.
How will these actions affect current shareholders? Effective immediately,
Orbitex will take over investment management of the Fund subject to the Fund's
existing investment objectives, policies and guidelines as set forth in the
Fund's current prospectus. The Board of Directors has selected ADS Distributors,
Inc. as the Fund's new distributor. Shortly, you will receive more detailed
information describing the tax-free reorganization and the Orbitex funds. In
addition to the Growth Fund, Orbitex currently manages several other mutual
funds with which shareholders will have commission free exchange privileges.
Orbitex manages the Orbitex Group of Funds (US), a family of equity mutual funds
available to individual investors through broker/dealers and financial advisors.
Orbitex is affiliated with the Orbitex Group of Funds (Canada), a global
investment advisor founded in 1986. Orbitex maintains offices in New York,
London, Zurich, Nassau, Frankfurt, Mexico City and Dubai.
We appreciate your continued confidence and look forward to serving you in the
future.
Thank you,
The Board of Directors
<PAGE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
THE BOARD OF DIRECTORS AND SHAREHOLDERS OF
AMERICAN DIVERSIFIED GLOBAL VALUE FUND
LOS ANGELES, CALIFORNIA
We have audited the accompanying statement of assets and liabilities of American
Diversified Global Value Fund (formerly the Rea-Graham Balanced Fund) including
the portfolio of investments, as of March 31, 1999, and the related statement of
operations, the statement of changes in net assets, and the financial highlights
for the year then ended March 31, 1999. These financial statements 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
audit. The financial statements and financial highlights presented for the
year ended March 31, 1998 and prior were audited by other auditors whose report
dated April 24, 1998, expressed an unqualified opinion on such statements and
financial highlights.
We conducted our audit 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 March 31, 1999,
by correspondence with the custodian. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that
our audit provides 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
American Diversified Global Value Fund as of March 31, 1999, the results of its
operations, the changes in its net assets, and the financial highlights for the
year then ended, in conformity with generally accepted accounting principles.
TAIT, WELLER & BAKER
PHILADELPHIA, PENNSYLVANIA
MAY 4, 1999
<PAGE>
AMERICAN DIVERSIFIED GLOBAL VALUE FUND
STATEMENT OF INVESTMENTS
MARCH 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES VALUE
------ COMMON STOCKS - 73.43% (NOTE 2-A)
--------------------- ----------
<S> <C> <C>
AUTOMOTIVE - 3.73%
11,100 Volkswagen AG (Germany) $ 147,636
4,000 Autoliv Inc. (Sweden) 150,250
-----------
297,886
-----------
CONGLOMERATE - 1.69%
2,700 Seagram Co. Ltd. (Canada) 135,000
-----------
CONSUMER PRODUCTS - 4.49%
4,500 Diageo PLC ADR (UK) 205,875
2,300 Unilever N.V. ADR (Netherlands) 152,806
-----------
358,681
CONTAINERS - 3.82%
6,000 Crown Cork & Seal Co. (USA) 171,375
6,700 Jefferson Smurfit Grp. ADR (Ireland) 134,000
-----------
305,375
-----------
DEFENSE - 2.14%
5,000 Boeing Co. (USA) 170,625
-----------
ELECTRONICS - 2.86%
2,500 Sony Corp. ADR (Japan) 228,281
-----------
ENERGY/OIL/GAS - 4.41%
2,300 Exxon Corp. (USA) 162,294
3,700 Repsol SA ADR (Spain) 189,625
-----------
351,919
-----------
FINANCE - 16.12%
4,200 Allstate Corp. (USA) 155,663
17,800 Bank Austria AG (Austria) 211,767
2,200 Chase Manhattan Corp. (USA) 178,887
3,800 Household International, Inc. (USA) 173,375
2,000 Merrill Lynch & Co. (USA) 176,875
3,800 Royal & Sun Alliance ADR (UK) 171,950
5,700 Societe Generale ADR (France) 219,069
-----------
1,287,586
-----------
HEALTHCARE - 6.67%
7,500 Invacare Corp. (USA) 182,344
2,200 Novartis AG ADR (Switzerland) 178,435
3,900 Rhone-Poulenc SA ADR (France) 171,600
-----------
532,379
-----------
OFFICE EQUIPMENT - 2.38%
8,000 Canon, Inc. ADR (Japan) 191,000
-----------
</TABLE>
<PAGE>
- --------------------------------------------------------------------------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
AMERICAN DIVERSIFIED GLOBAL VALUE FUND
STATEMENT OF INVESTMENTS - (CONTINUED)
MARCH 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES VALUE
------ COMMON STOCKS - 73.43% (NOTE 2-A)
--------------------- ----------
<S> <C> <C>
RETAIL - 3.25%
4,500 Nike Inc. Class B $ 259,594
-----------
SERVICE - 2.05%
7,000 Manpower, Inc. (USA) 163,625
-----------
TECHOLOGY - 7.93%
7,500 First Data Corp. 320,625
700 International Business Machines (USA) 124,075
1,900 Texas Instruments, Inc. (USA) 188,575
-----------
633,275
-----------
TELECOMMUNICATIONS - 10.01%
8,000 Alcatel Alsthom (France) 182,500
3,000 AT&T Corp. (USA) 239,437
3,900 Portugal Telecom SA ADR (Portugal) 170,869
5,300 Telecom New Zealand ADR (New Zealand) 206,700
-----------
799,506
-----------
UTILITIES - 1.88%
3,600 Texas Utilities Co. (USA) 150,075
-----------
TOTAL COMMON STOCKS (COST $5,313,019) 5,864,807
-----------
PRINCIPAL
--------- U.S. GOVERNMENT OBLIGATIONS - 25.14%
$ 500,000 U.S. Treasury Notes, 5.625%, Due 5/15/01 $ 506,094
1,000,000 U.S. Treasury Notes, 5.375%, Due 6/30/00 1,005,313
500,000 U.S. Treasury Notes, 4.500%, Due 9/30/00 496,406
-----------
TOTAL U.S. GOVERNMENT OBLIGATIONS (COST $2,013,541) 2,007,813
-----------
SHORT-TERM INVESTMENTS - 1.38%
110,107 Chase Institutional Money Market (Cost $110,107) 110,107
-----------
TOTAL INVESTMENTS (COST $7,436,667) - 99.95% 7,982,727
OTHER ASSETS LESS LIABILITIES NET - .05% 3,992
-----------
NET ASSETS - 100% $7,986,719
-----------
-----------
</TABLE>
<PAGE>
- --------------------------------------------------------------------------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
AMERICAN DIVERSIFIED GLOBAL VALUE FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
ASSETS
Investments at market value
(Identified cost $7,436,667) (NOTE 2-A) $7,982,727
Interest receivable 24,228
Dividends receivable 11,159
Other assets 42,234
----------
TOTAL ASSETS 8,060,348
----------
LIABILITIES
Payable to custodian $ 8,758
Advisory fee payable 13,455
Administration fees payable 5,785
Distribution fees payable 4,709
Accrued expenses 40,922
----------
TOTAL LIABILITIES 73,629
----------
NET ASSETS
(Applicable to 503,747 shares outstanding) $7,986,719
----------
----------
NET ASSET VALUE
Net asset value per share
($7,986,719 / 503,747 shares) $15.85
----------
----------
Offering price per share
(100/95.25 x 15.85) $16.64
----------
----------
NET ASSETS
At March 31, 1999, net assets consisted of:
Paid-in capital $8,381,876
Undistributed net investment income 10,084
Accumulated net realized loss on investments (951,301)
Net unrealized appreciation 546,060
----------
$7,986,719
----------
----------
</TABLE>
<PAGE>
- --------------------------------------------------------------------------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
AMERICAN DIVERSIFIED GLOBAL VALUE FUND
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED MARCH 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INVESTMENT INCOME
<S> <C>
Interest income $ 215,923
Dividends (net of foreign tax withheld of $9,071) 99,666
---------
TOTAL INCOME 315,589
---------
EXPENSES
Management fee (NOTE 3) 88,174
12b-1 fees (NOTE 3) 31,200
Administration fees (NOTE 3) 31,679
Transfer agent fees 15,470
Accounting fees 16,239
Legal and audit fees 31,828
Shareholder reporting 18,441
Custodian fees 19,094
Registration fees 20,548
Miscellaneous 6,352
Insurance 1,170
Directors fees 11,851
---------
TOTAL EXPENSES 292,046
Expenses reimbursed (NOTE 3) (41,630)
Expenses waived (NOTE 3) (54,951)
---------
NET EXPENSE 195,465
---------
NET INVESTMENT INCOME 120,124
---------
NET REALIZED AND UNREALIZED LOSS ON INVESTMENTS
Net realized loss from security transactions (247,128)
Change in unrealized appreciation of investments (326,471)
---------
NET LOSS ON INVESTMENTS (573,599)
---------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS $(453,475)
----------
----------
</TABLE>
<PAGE>
- --------------------------------------------------------------------------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
AMERICAN DIVERSIFIED GLOBAL VALUE FUND
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE FOR THE
YEAR ENDED YEAR ENDED
MARCH 31, MARCH 31,
1999 1998
----------- -----------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS
Net investment income $ 120,124 $ 138,007
Net realized gain (loss) on investments (247,128) 266,439
Change in unrealized appreciation of investments (326,471) 883,902
----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM OPERATIONS (453,475) ,288,348
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income
($.27 and $.23 per share, respectively) (139,910) (143,282)
CAPITAL SHARE TRANSACTIONS (NOTE 4)
Increase in net assets resulting from capital
share transactions (1,342,433) (1,703,230)
----------- -----------
TOTAL DECREASE IN NET ASSETS (1,935,818) (558,164)
NET ASSETS
Beginning of year 9,922,537 10,480,701
----------- -----------
END OF YEAR
(Including undistributed investment income of
$10,084 and $29,870, respectively) $ 7,986,719 $ 9,922,537
----------- -----------
----------- -----------
</TABLE>
<PAGE>
- --------------------------------------------------------------------------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
AMERICAN DIVERSIFIED GLOBAL VALUE FUND
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1999
- --------------------------------------------------------------------------------
(1) NATURE OF BUSINESS AND BASIS OF PRESENTATION
American Diversified Global Value Fund (formerly Rea-Graham Balanced Fund)
(the "FUND") is the only series of shares of American Diversified Funds,
Inc. (formerly Rea-Graham Funds, Inc.), a diversified open-end management
investment company registered under the Investment Company Act of 1940.
It was organized in 1982 to succeed to the business of Rea, Graham-Plan
Fund, an investment company organized as a limited partnership which
commenced operations June 30, 1976 for the purpose of investing the
partners' capital in securities under professional investment management.
This succession occurred on April 29, 1982 when the partnership's net
assets aggregating $3,436,275 were transferred to the Fund in exchange for
300,000 shares of the Fund's capital stock. The Fund seeks as its
investment objectives medium-term capital growth, income and safety through
balanced investments in common stocks, preferred stocks, U.S. Government
Securities and money market instruments.
The selected financial information, for the periods prior to April 29, 1982
(NOTE 7), gives effect to the assumed issuance of shares for partners'
capital contributions based upon the 300,000 shares issued on April 29,
1982 as described above.
(2) SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by
the Fund in the preparation of its financial statements.
(A) VALUATION OF SECURITIES. Investments are stated at value based on
latest sales prices reported on national securities exchanges on the
last business day of the period. Investments for which no sale is
reported, or which are traded over the counter, are valued at the mean
between bid and asked prices.
(B) INCOME TAXES. The Fund intends to comply with the provisions of the
Internal Revenue Code applicable to regulated investment companies and
to distribute all of its taxable income to its shareholders. Therefore
no provision has been made for federal income taxes.
(C) USE OF ESTIMATES. The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported
amounts of asset and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the
reported amounts of increases and decreases in net assets from
operations during the reporting period. Actual results could differ
from those estimates.
<PAGE>
(D) OTHER. Securities transactions are recorded on the trade date basis.
Interest is accrued as earned and dividend income is recorded on the
ex-dividend date, except that certain dividends from foreign
securities are recorded as soon as information is available to the
Fund. Dividends and capital gain distributions to shareholders are
recorded on the ex-dividend date.
- --------------------------------------------------------------------------------
AMERICAN DIVERSIFIED GLOBAL VALUE FUND
NOTES TO FINANCIAL STATEMENTS - (CONTINUED)
MARCH 31, 1999
- --------------------------------------------------------------------------------
(3) INVESTMENT ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES
On March 31, 1998, James Buchanan Rea, Inc. ("JBRI") the investment adviser
and principal underwriter of the Fund completed a merger transaction
pursuant to which all of the outstanding voting securities of JBRI were
acquired by American Diversified Asset Management, Inc. ("ADAM"). A new
Investment Advisory Agreement with ADAM, which is substantially similar to
the Fund's previous Investment Advisory Agreement with JBRI and provides
for the same investment advisory fee schedule, became effective on the same
date. Under the terms of the agreement the Adviser receives a monthly fee
of 1/12 of 1% of the first $20,000,000 of the Fund's net assets on the last
business day of the month, 1/12 of .75% of the next $80,000,000, 1/12 of
.5% of the next $100,000,000, and 1/12 of .45% of monthly net assets in
excess of $200,000,000. ADAM has voluntarily agreed for a period of two
years following the merger to limit the Fund's total operating expenses to
2.80% per annum. Effective August 1, 1998 ADAM voluntarily agreed to reduce
the expense limit to 1.88% per annum. For the year ended March 31, 1999,
ADAM reimbursed $41,630 and waived $54,951 in expenses.
The Fund also reimburses ADAM for the Fund's share of ADAM's administrative
and overhead costs. During the year ended March 31, 1999, such costs were
$31,679.
Pursuant to a Plan of Distribution the Fund paid monthly to ADAM, as
Principal Underwriter, (until December 1998 when American Diversified
Global Equities, Inc. ("ADGE") succeeded ADAM as principal underwriter), a
distribution fee equal on an annual basis to 0.35% of the Fund's average
daily net assets. There were no additional expenses borne by the Fund
pursuant to the Plan of Distribution.
During the year ended March 31, 1999, ADAM/ADGE earned commissions of $311
as principal underwriter and authorized dealer in Fund shares.
(4) CAPITAL STOCK
At March 31, 1999, there were 20,000,000 shares of capital stock ($1 par
value) authorized and paid-in capital amounted to $8,381,877. Transactions
in capital stock were as follows:
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
MARCH 31, 1999 MARCH 31, 1998
---------------------------------------------------------------
SHARES VALUE SHARES VALUE
------ ----- ------ -----
<S> <C> <C> <C> <C>
Sold 38,691 $ 634,682 4,319 $ 69,856
<PAGE>
Issued on reinvested of dividends 8,723 133,280 8,269 132,462
Redeemed (135,277) (2,110,395) (119,982) 905,548)
--------- ------------ --------- ------------
NET DECREASE (87,863) $(1,342,433) (107,394) $(1,703,230)
--------- ------------ --------- ------------
--------- ------------ --------- ------------
</TABLE>
- --------------------------------------------------------------------------------
AMERICAN DIVERSIFIED GLOBAL VALUE FUND
NOTES TO FINANCIAL STATEMENTS - (CONTINUED)
MARCH 31, 1999
- --------------------------------------------------------------------------------
(5) INVESTMENT TRANSACTIONS
During the year ended March 31, 1999, purchases and sales of investment
securities, excluding short-term obligations, were as follows:
COST OF PROCEEDS OF
PURCHASES SALES
--------- -----------
U.S. Government Obligations $ 2,013,541 $1,000,625
Other securities 10,295,208 6,962,960
----------- ----------
$12,308,749 $7,963,585
----------- ----------
----------- ----------
The aggregate portfolio turnover of the Fund for the year ended March 31,
1999 was 119%. Portfolio turnover on stocks was 144%. Portfolio turnover on
U.S. Government Obligations was 52%.
Realized gains and losses are reported on an identified cost basis.
Accumulated undistributed net realized losses at March 31, 1999 were
$951,301. Such amount represents tax basis capital losses which may be
carried forward to offset future capital gains. Such losses expire in
varying amounts from March 31, 2003 to March 31, 2007.
At March 31, 1999, the cost of investments for federal income tax purposes
was $7,436,667. The aggregate gross unrealized appreciation and
(depreciation) of portfolio securities was as follows:
Unrealized appreciation $ 744,894
Unrealized depreciation (198,834)
---------
$ 546,060
---------
---------
(6) SUBSEQUENT EVENT
On April 7, 1999, The Board of Directors of the Fund were advised that ADAM
was insolvent and would not be in a position to continue serving as the
Fund's investment adviser. On May 4, 1999, the Board of Directors approved
a plan of reorganization whereby the Fund would, subject to stockholder
approval, merge into the Orbitex Growth Fund in a tax-free exchange of
shares and at the same time approved Orbitex Investment Management to serve
as the Fund's adviser until the reorganization is consummated. A special
meeting of shareholders is proposed to be held in the latter half of July
1999.
<PAGE>
AMERICAN DIVERSIFIED GLOBAL VALUE FUND
NOTES TO FINANCIAL STATEMENTS - (CONTINUED)
MARCH 31, 1999
- --------------------------------------------------------------------------------
(7) SELECTED FINANCIAL INFORMATION
<TABLE>
<CAPTION>
YEARS ENDED MARCH 31,
- ------------------------------------------------------------------------------------------------------------------------------------
1999 1998 1997 1996 1995 1994 1993 1992
---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
Net asset value, beginning of year $16.77 $14.99 $14.36 $13.12 $13.20 $13.68 $13.14 $12.84
------- ------ ------ ------ ------ ------ ------ ------
Income from investment operations
Net investment income 0.24 0.23 0.27 0.31 0.15 0.07 0.21 0.59
Net realized and unrealized gain (loss)
on investments (0.89) 1.78 0.65 1.24 (0.13) (0.47) 0.59 0.37
------- ------ ------ ------ ------ ------ ------ ------
Total from investment operations (0.65) 2.01 0.92 1.55 0.02 (0.40) 0.80 0.96
------- ------ ------ ------ ------ ------ ------ ------
Less distributions:
Dividends from net investment income (0.27) (0.23) (0.29) (0.31) (0.10) (0.08) (0.26) (0.66)
Dividends from net realized gains 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
------- ------ ------ ------ ------ ------ ------ ------
Total distributions (0.27) (0.23) (0.29) (0.31) (0.10) (0.08) (0.26) (0.66)
------- ------ ------ ------ ------ ------ ------ ------
Net asset value, end of year $15.85 $16.77 $14.99 $14.36 $13.12 $13.20 $13.68 $13.14
------- ------ ------ ------ ------ ------ ------ ------
------- ------ ------ ------ ------ ------ ------ ------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year (000's) $7,987 $9,923 $10,481 $12,277 $14,242 $17,877 $24,771 $28,281
------- ------ ------ ------ ------ ------ ------ ------
------- ------ ------ ------ ------ ------ ------ ------
Ratios to average net assets:
Expenses (net of reimbursement) 2.19%+ 3.13% 2.89% 2.65% 2.52% 2.37% 2.16% 2.06%
Net investment income 1.35% 1.36% 1.70% 2.02% 1.08% 0.49% 1.45% 4.05%
Aggregate portfolio turnover rate 119% 8% 19% 223% 93% 106% 87% 109%
Portfolio turnover rate on stocks** 144% 14% 45% 88% 36%
Net asset value adjusted for reinvestment
of dividends and distributions:
Beginning of year $34.81 $34.67 $32.58 $29.14 $29.09 $29.97 $28.24 $26.23
------- ------ ------ ------ ------ ------ ------ ------
End of year $31.89 $39.34 $34.67 $32.58 $29.14 $29.09 $29.97 $28.24
------- ------ ------ ------ ------ ------ ------ ------
------- ------ ------ ------ ------ ------ ------ ------
TOTAL RETURN (excluding sales charge) (3.82)% 13.48% 6.41% 11.81% 0.17% (2.94)% 6.13% 7.66%
<CAPTION>
YEARS ENDED MARCH 31,
- ------------------------------------------------------------------------------------------------------------------------------------
1991 1990 1989 1988 1987 1986
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
Net asset value, beginning of year $13.56 $13.90 $13.83 $ 15.56 $16.45 $13.65
------ ------ ------ ------- ------ ------
Income from investment operations
Net investment income 0.75 0.90 0.78 0.66 0.43 0.50
Net realized and unrealized gain (loss)
on investments (0.65) (0.27) 0.25 (0.46) 0.98 3.06
------ ------ ------ ------- ------ ------
Total from investment operations 0.10 0.63 1.03 0.20 1.41 3.56
------ ------ ------ ------- ------ ------
Less distributions:
Dividends from net investment income (0.82) (0.96) (0.68) (1.03) (0.47) (0.53)
Dividends from net realized gains 0.00 (0.01) (0.28) (0.90) (1.83) (0.23)
------ ------ ------ ------- ------ ------
Total distributions (0.82) (0.97) (0.96) (1.93) (2.30) (0.76)
------ ------ ------ ------- ------ ------
Net asset value, end of year $12.84 $13.56 $13.90 $13.83 $15.56 $16.45
------ ------ ------ ------- ------ ------
------ ------ ------ ------- ------ ------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year (000's) $34,758 $43,386 $50,554 $49,287 $48,141 $31,531
------ ------ ------ ------- ------ ------
------ ------ ------ ------- ------ ------
Ratios to average net assets:
Expenses (net of reimbursement) 2.04% 1.60% 1.43% 1.41% 1.48% 1.50%
Net investment income 5.27% 5.82% 5.46% 4.82% 3.54% 4.78%
Aggregate portfolio turnover rate 100% 125% 88% 226% 111% 208%
Portfolio turnover rate on stocks**
Net asset value adjusted for reinvestment
of dividends and distributions:
Beginning of year $25.95 $24.85 $23.10 $22.69 $20.78 $16.24
------ ------ ------ ------- ------ ------
End of year $26.23 $25.95 $24.85 $23.10 $22.69 $20.73
------ ------ ------ ------- ------ ------
------ ------ ------ ------- ------ ------
TOTAL RETURN (excluding sales charge) 1.08% 4.43% 7.58% 1.81% 9.45% 27.65%
** PROVIDED FOR ADDITIONAL INFORMATION. PORTFOLIO TURNOVER RATE ON STOCKS
FOR PERIODS PRIOR TO 1995 NOT AVAILABLE.
+ IN THE ABSENCE OF THE REIMBURSEMENT, EXPENSES WOULD HAVE BEEN 3.28% FOR
THE YEAR ENDED MARCH 31, 1999.
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
AMERICAN DIVERSIFIED GLOBAL VALUE FUND
NOTES TO FINANCIAL STATEMENTS - (CONTINUED)
MARCH 31, 1999
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
(7) SELECTED FINANCIAL INFORMATION - (CONTINUED)
PRO FORMA
INFORMATION + (UNAUDITED)
----------------------------
YEARS ENDED APRIL 30, YEARS ENDED
MARCH 31, 1982 TO JANUARY 1, DECEMBER 31,
---------------- MARCH 31, TO APRIL 29, ---------------
1985 1984 1983 1982 1981 1980
---- ---- ------- -------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
Net asset value, beginning of period $13.09 $13.89 $11.45 $11.09 $ 9.55 $8.66
------ ------ ------ ------ ------ -----
Income from investment operations:
Net investment income 0.46 0.72 0.43 0.05 0.59 0.56
Net realized and unrealized gain (loss) on investments 1.12 (0.27) 2.01 0.31 0.95 0.33
------ ------ ------ ------ ------ -----
Total from investment operations 1.58 0.45 2.44 0.36 1.54 0.89
------ ------ ------ ------ ------ -----
Less distributions:
Dividends from net investment income (0.74) (0.33) 0.00 0.00 0.00 0.00
Dividends from net realized gains (0.28) (0.92) 0.00 0.00 0.00 0.00
------ ------ ------ ------ ------ -----
Total distributions (1.02) (1.25) 0.00 0.00 0.00 0.00
------ ------ ------ ------ ------ -----
Net asset value, end of period $13.65 $13.09 $13.89 $11.45 $11.09 $9.55
------ ------ ------ ------ ------ -----
------ ------ ------ ------ ------ -----
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) $13,627 $9,842 $6,863 $3,436 $3,200 $2,631
Ratios to average net assets:
Expenses 2.28% 2.45% 1.50%* 3.62%* 2.70% 3.10%
Net investment income 4.68% 6.46% 5.49%* 2.90%* 6.48% 3.85%
Portfolio turnover rate 196% 261% 187% 9% 135% 151%
Net asset value adjusted for reinvestment of dividends and
distributions: Beginning of period $14.35 $13.89 $11.45 $11.09 $9.55 $8.66
------ ------ ------ ------ ------ -----
------ ------ ------ ------ ------ -----
End of period $16.24 $14.35 $13.89 $11.45 $11.09 $9.55
------ ------ ------ ------ ------ -----
------ ------ ------ ------ ------ -----
TOTAL RETURN (excluding sales charge) 13.17% 3.31% 21.31% 3.25% 16.13% 10.28%
</TABLE>
<TABLE>
<CAPTION>
PRO FORMA INFORMATION + (UNAUDITED)
-----------------------------------------
JUNE 30, 1976
(COMMENCEMENT
YEARS ENDED DECEMBER 31, OF OPERATIONS)
------------------------ TO DECEMBER 31,
1979 1978 1977 1976
---- ---- ---- ---------------
<S> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
Net asset value, beginning of period $7.45 $ 6.75 $ 6.54 $ 6.03
----- ------ ------ ------
Income from investment operations:
Net investment income 0.30 0.12 0.18 0.00
Net realized and unrealized gain (loss) on investments 0.91 0.58 0.03 0.51
----- ------ ------ ------
Total from investment operations 1.21 0.70 0.21 0.51
----- ------ ------ ------
Less distributions:
Dividends from net investment income 0.00 0.00 0.00 0.00
Dividends from net realized gains 0.00 0.00 0.00 0.00
----- ------ ------ ------
Total distributions 0.00 0.00 0.00 0.00
----- ------ ------ ------
Net asset value, end of period $8.66 $7.45 $6.75 $6.54
----- ------ ------ ------
----- ------ ------ ------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) $3,063 $2,169 $1,458 $1,093
Ratios to average net assets:
Expenses 3.07% 2.90% 2.77% 4.92%*
Net investment income 4.63% 2.72% 2.98% -
Portfolio turnover rate 101% 135% 148% 22%
Net asset value adjusted for reinvestment of dividends
and distributions:
Beginning of period $7.45 $6.75 $6.54 $6.03
----- ------ ------ ------
----- ------ ------ ------
End of period $ 8.66 $7.45 $ 6.75 $6.54
----- ------ ------ ------
----- ------ ------ ------
TOTAL RETURN (excluding sales charge) 16.24% 10.37% 3.21% 8.46%
* ANNUALIZED
+ PREPARED AS IF THE PREDECESSOR PARTNERSHIP (NOTE 1) HAD BEEN ORGANIZED AS A
CORPORATION ON JUNE 30, 1976, THE DATE OF COMMENCEMENT OF ITS OPERATIONS,
AND HAD INITIALLY ISSUED CAPITAL STOCK AT A NET ASSET VALUE OF $6.03 PER
SHARE.
- --------------------------------------------------------------------------------------------------------------
</TABLE>
