(ICON)
Prudential
Global
Fund, Inc.
ANNUAL
REPORT
Oct. 31, 1995
(LOGO)
<PAGE>
Prudential Global Fund, Inc.
Performance At A Glance.
The global stock markets rebounded this year, posting a 5% return for the six
months ended October, as measured by the Morgan Stanley World Index. This
performance marks a sharp reversal from last winter, when a series of negative
surprises sent most foreign stock markets lower. We are pleased to report that
for the 12-month periods ended in October the Prudential Global Fund Class A
shares performed better than the average global fund measured by Lipper
Analytical Services.
<TABLE>
<CAPTION>
Cumulative Total Returns1 As of 10/31/95
One Five Ten Since
Year Years Years Inception2
<S> <C> <C> <C> <C>
Class A 5.7% 75.1% N/A 55.1%
Class B 5.0 68.9 195.0% 315.5
Class C 5.0 N/A N/A 8.7
Lipper Global Fund Avg3 5.2 69.6 250.8 352.2
</TABLE>
<TABLE>
<CAPTION>
Average Annual Total Returns1 As of9/30/95
One Five Ten Since
Year Years Years Inception2
<S> <C> <C> <C> <C>
Class A 5.6% 12.3% N/A 7.5%
Class B 5.5 12.5 11.7% 13.6
Class C 9.5 N/A N/A 9.5
</TABLE>
Past performance is not a guarantee of 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.
1Source: Prudential Mutual Fund Management and Lipper Analytical Services. The
cumulative total returns do not take into account sales charges. The average
annual returns do take into account applicable sales charges. The Fund charges
a maximum front end sales load of 5% for
Class A shares. Class B shares are subject to a declining contingent deferred
sales charge (CDSC) of 5%, 4%, 3%, 2%, 1% and 1%, for six years. Class C shares
have a 1% CDSC for one year. Class B shares will automatically convert to Class
A shares on a quarterly basis, after approximately seven years.
2 Inception dates: 1/22/90 Class A; 5/16/84 Class B; 8/1/94 Class C.
3 The Lipper Fund average includes 120 funds in the global category for one
year; 30 funds for five years; and nine since inception, as determined by
Lipper Analytical Services, Inc.
How Investments Compared.
(As of 10/31/95)
(CHART)
Source: Lipper Analytical Services. Financial markets change, so a mutual
fund's past performance should never be used to predict future results. The
risks to each of the investments listed above are different -- we provide
12-month total returns for several Lipper mutual fund categories to show you
that reaching for higher yields means tolerating more risk. The greater the
risk, the larger the potential reward or loss. In addition, we've added
historical 20-year average annual returns to show that some of 1995's returns
in the U.S. market (so far) are higher than normal. These returns assume the
reinvestment of dividends.
U.S. Growth Funds will fluctuate a great deal. Smaller capitalization stocks
offer greater potential for long term growth but may be more volatile than
larger capitalization stocks. Investors receive higher historical total returns
from stocks than from most other investments.
Bond Funds provide more income than stock funds, which can help smooth out
their total returns year by year. But their prices still fluctuate (sometimes
substantially) and their returns are historically lower than those of stock
funds.
Global Stock Funds will also fluctuate a great deal. Historically, foreign
investments have offered greater returns than domestic investments. However,
investments overseas are subject to political, social, and currency risks that
may affect performance.
Money Market Funds attempt to preserve a constant share value; they don't
fluctuate much in price but their returns are generally among the lowest of the
major investment categories.
<PAGE>
Dan Duane, Fund Manager
(PHOTO)
Portfolio
Manager's Report
The Prudential Global Fund invests primarily in U.S. and foreign stocks. It
invests globally, so the Fund is subject to all the risks associated with
foreign investing, including currency, political and social risks.
Growth Investor.
Daniel J. Duane, managing director and portfolio manager, works with a team of
investment professionals to identify long-term economic, social and demographic
themes that will lead to high earnings growth levels.
Strategy Session.
Foreign stock markets look attractive to us. Last winter, many foreign markets
struggled through currency turmoil, financial scandals and a general crisis of
confidence among global stock investors. We thought most of those worries were
unfounded and, since April, more investors have been seeing things from our
point of view. What do they see? Economic growth has been more robust in many
foreign countries than in the U.S., and while corporate earnings overseas have
generally exceeded expectations, they have only begun to be reflected in
foreign stock prices.
Our strategy in the Prudential Global Fund has been to emphasize economically-
sensitive stocks in three key areas: the United States, Europe and the Pacific
Rim.
For long-term growth potential, our favorite regions are Europe and the smaller
Pacific Rim markets, where corporate earnings have been strong.
- -In the Pacific Rim, we are adding to our holdings in Hong Kong, as we expect
companies there will be the prime beneficiaries of renewed growth in mainland
China.
- -We are also adding slightly to our Japanese holdings (now 15% of total net
assets, up from 12%), where stocks benefited from both the weakening yen
(which makes exports more attractive to overseas consumers) and the
government's action to strengthen the banking sector.
- -We are reducing our holdings in Malaysia, where the economy has been growing
so rapidly that it is overheating. We see no signs the government will do
anything to cool it down soon.
- -Around the world, we're buying luxury retailers, entertainment and leisure
companies. As the baby boomers age, we think they'll have more disposable
income to spend on the finer things in life.
Sector Breakdown.
Prudential Global Fund
As of 10/31/95
(CHART)
<PAGE>
What Went Well.
Change In Europe.
We took advantage of a broadening economic recovery in Europe by shifting
assets from companies that benefit early in the business cycle to those that
benefit later. So we sold basic materials stocks in the chemical and steel
industries (typical "early business cycle" stocks) and bought consumer-oriented
stocks in the retail, machinery, telecommunications and technology sectors.
We also took profits in some of our stronger performers. For instance, we sold
some of our holdings in German data processing and reproduction company Sap, in
French engineering company Sidel, and in Finnish cellular phone manufacturer
Nokia, whose price has more than doubled in the past year. Nokia is one of our
favorite companies -- and it remains one of our largest holdings.
Technology Was Tops.
Our decision this summer to sell some U.S. computer hardware stocks proved
wise. We worry that new productive capacity now being built will depress
hardware prices in the next year or two despite continuing strong demand. So we
have moved assets into software manufacturers, who stand to benefit from wider
and cheaper hardware availability. Our only remaining U.S. hardware company is
Texas Instruments. Abroad, we're down to positions in Samsung Electronics
(memory chips) and Kyocera (ceramic packages for microprocessors).
And Not So Well.
We Could Have Made More in the U.S.A.
While our U.S. stocks performed substantially better than the S&P 500, we could
have benefited by holding an even greater exposure there. The U.S. stock market
led all other world markets over the past year, but accounted for just 20% of
the Fund's assets as of October 31.
Five Largest Holdings.*
<TABLE>
<C> <S>
2.5% Nokia
Telecommunications
2.4% Microsoft
Computer Software
2.3% Western Mining
Metals - Non-ferrous
2.2% Sap Ag
Data Processing & Repro
2.2% Nintendo
Recreation & Other
Consumer Goods
</TABLE>
*Expressed as a percentage of total net assets as of 10/31/95. Portfolio
holdings are subject to change.
Looking Ahead.
We are optimistic many global markets will catch up to the U.S., posting
stronger gains in coming months. We believe many companies still show strong
potential for increased earnings both from productivity improvements and from
the effects of economic growth. We'll be watching the government-owned
companies that are sold to the public next year --we might find some bargains
here, but some recent deals have not gone well for investors. Our favorite area
is still the smaller Pacific Rim countries. Growth in China should take hold
next year, which will really boost sales and revenues for the Asian companies
that sell goods and services to China. Still, we wouldn't be surprised if the
lingering effects of the year's financial turmoil continues to add an extra
measure of volatility to global funds.
- -------------------------------------------------------------------------------
1
<PAGE>
President's Letter
(PHOTO)
December 11, 1995
Dear Shareholder:
For many investors, 1995 was a profitable year -- most stock and bond funds
enjoyed healthy returns from the U.S. markets. While climbing returns can tempt
even the most skittish investors to start buying again, it is important to
remember that the stock and bond markets go down just as they go up. At times
like these, remember the importance of working with your Financial Advisor or
Registered Representative to help you find investments that are consistent with
your risk tolerance and time horizon. Your Financial Advisor or Registered
Representative can help you maintain realistic expectations about both the
potential performance and risks associated with your investments.
American Dream Savings Account.
The U.S. Congress is now considering one of the most significant and positive
pieces of legislation to affect individual investors -- the American Dream
Savings Account. This legislation may improve the traditional Individual
Retirement Account (IRA) by allowing higher non-working spouse contributions as
well as tax-free and penalty-free withdrawals from the account before age
59 1/2, for certain expenses. We will keep our Financial Advisors and
Registered Representatives updated on the progress of this legislation, so call
him or her to learn how you may benefit.
Shareholder Legislative Action Program.
From time to time we've be informing you about significant legislation before
Congress, such as the American Dream Savings Account, that may potentially
impact mutual fund investors. We want to make it easier for you to share your
views with your Congressional member. So, beginning in 1996, your shareholder
reports will contain postage-paid message cards that you simply drop in the
mail if you want to let your senator or representative know how you feel about
pending legislation.
Fund Profiles.
Over the past year, we've worked to make your shareholder reports more
interesting, informative and easy to read. This year, we'll be turning our
attention to "fund profiles." Some mutual fund companies now offer one to
shareholders along with a full prospectus. The purpose of a fund profile is to
provide a very brief, reader-friendly summary of a fund's objective,
investments, risks and expenses. Would you like to see fund profiles from us?
Please call your Financial Advisor or Registered Representative to share your
views.
As always, thank you for your confidence in Prudential Mutual Funds.
Sincerely,
Richard A. Redeker
President
- -------------------------------------------------------------------------------
2
<PAGE>
Portfolio of Investments as of October 31, 1995 PRUDENTIAL GLOBAL FUND, INC.
<TABLE>
<CAPTION>
Shares Description Value (Note 1)
<C> <S> <C>
------------------------------------------------------------
LONG-TERM INVESTMENTS--96.1%
COMMON STOCKS--94.9%
------------------------------------------------------------
Australia--8.0%
371,500 Brambles Industries, Ltd. (Business
& Public Services) $ 3,948,457
518,417 Broken Hill Proprietary Co., Ltd.
(Other Energy Sources) 7,017,689
1,374,919 Coca-Cola Amatil, Ltd. (Beverages &
Tobacco) 10,635,403
1,486,600 Nine Network Australia, Ltd.
(Broadcasting & Publishing) 4,731,007
62,900 Qantas Airways Limited (ADR)
(Airlines) 1,111,020
398,000 Qantas Airways, Ltd.*
(Transportation-Airlines) 702,998
1,794,125 Western Mining Corp. Holdings, Ltd.
(Metals-Non Ferrous) 11,501,327
-------------
39,647,901
- ------------------------------------------------------------
Belgium--0.7%
5,000 Bekaert S.A., N.V. (Industrial
Components) 3,676,534
- ------------------------------------------------------------
Federal Republic of Germany--3.5%
9,920 Linde AG (Machinery & Engineering) 6,089,777
70,000 Sap Ag (Data Processing &
Reproduction) 11,088,322
-------------
17,178,099
- ------------------------------------------------------------
Finland--2.5%
213,700 Nokia Corp. (Telecommunication
Equipment) 12,222,782
France--6.4%
11,100 Carrefour (Retail) $ 6,523,866
45,000 Imetal S.A. (Misc. Materials &
Commodities) 5,304,356
4,235 LaFarge Coppee (New) (Building
Materials & Components) 280,886
57,255 LaFarge Coppee (Old) (Building
Materials & Components) 3,797,433
34,000 Legrand S.A. (Electrical Components) 5,691,541
18,300 Plastic Omnium (Automobilies & Auto
Parts) 1,198,391
10,000 Sgs Thomson Microelectronics*
(Electronic Components) 461,471
88,000 Sgs Thomson Microelectronics*
(Electronic Components) 3,982,000
95,300 Valeo (Automotive) 4,308,105
-------------
31,548,049
- ------------------------------------------------------------
Hong Kong--6.7%
6,531,213 CDL Hotels International Ltd.
(Leisure & Tourism) 2,956,714
2,350,000 CITIC Pacific, Ltd. (Multi-Industry) 7,340,615
1,852,000 Guoco Group, Ltd. (Multi-Industry) 8,575,738
8,990,000 Hung Hing Printing Group, Ltd.
(Forest Products & Paper) 1,866,303
1,459,000 Hutchison Whampoa, Ltd.
(Multi-Industry) 8,039,191
1,130,000 New World Development Co., Ltd.
(Property Developement) 4,399,390
-------------
33,177,951
- ------------------------------------------------------------
Indonesia--0.3%
1,549,000 Kabel Metal Industries, Ltd.
(Industrial Components) 1,406,787
- --------------------------------------------------------------------------------
See Notes to Financial Statements. 3 -----
<PAGE>
Portfolio of Investments as of October 31, 1995 PRUDENTIAL GLOBAL FUND, INC.
</TABLE>
<TABLE>
<CAPTION>
Shares Description Value (Note 1)
<C> <S> <C>
------------------------------------------------------------
Italy--1.9%
142,400 Gucci Group N V* (Retail) $ 4,272,000
3,075,000 Telecom Italia Mob*
(Telecommunications-Unregulated) 5,179,252
-------------
9,451,252
- ------------------------------------------------------------
Japan--14.0%
159,000 Aiwa Co. (Appliances & Household
Durables) 3,452,127
23,500 Autobacs Seven Co., (Retail) 2,217,848
243,000 Daibiru Corp. (Property Investment) 2,471,589
860 Ddi Corp.
(Telecommunications-Unregulated) 6,972,518
45,000 Keyence Corp. (Electronic Components
& Instruments) 5,545,232
77,000 Kyocera Corp. (Electronic Components
& Instruments) 6,310,611
425,000 Mitsui Fudosan Co., Ltd. (Property
Investment) 4,863,081
111,000 Nichiei Co. (Financial Services) 6,893,399
145,000 Nintendo Co., Ltd. (Recreation &
Other Consumer Goods) 10,664,059
92,640 Nissen Co., Ltd. (Retail) 2,672,743
248,000 Omron Corp. (Electronic Components &
Instruments) 5,796,773
106,000 Onward Kashiyama (Textile-Apparel
Manufacturing) 1,461,712
96,000 Rohm Co., Ltd. (Electronic
Components & Instruments) 5,830,416
92,300 Sony Music Entertainment (Recreation
& Other Consumer Goods) 3,953,780
-------------
69,105,888
- ------------------------------------------------------------
Korea--2.4%
9,408 Pohang Iron & Steel Co., Ltd.
(Metals-Steel) 818,889
829 Samsung Electronics (New)
(Electronic Components &
Instruments) 179,311
10,597 Samsung Electronics Co.* (New)
(Electronic Components &
Instruments) $ 2,333,653
39,330 Samsung Electronics Co., Ltd.*
(Electronic Components &
Instruments) 8,635,483
-------------
11,967,336
- ------------------------------------------------------------
Malaysia--3.1%
5,292,000 IJM Corporation Berhad
(Construction) 8,708,882
3,003,000 Renong Berhad (Multi-Industry) 4,587,260
790,000 Technology Resources Industries
Berhad (Utilities-Telephones) 2,006,102
-------------
15,302,244
- ------------------------------------------------------------
Mexico--1.1%
573,700 Apasco, S.A. (Building Materials &
Components) 2,101,554
1,596,400 Cifra, S.A. de C.V. (Retail) 1,698,345
866,900 Fomento Economico Mexicano, S.A. de
C.V. (Beverages & Tobacco) 1,795,852
-------------
5,595,751
- ------------------------------------------------------------
Netherlands--1.6%
44,600 Heineken N.V. (Beverages & Tobacco) 7,909,304
- ------------------------------------------------------------
New Zealand--1.5%
2,583,500 Fletcher Challenge, Ltd. (Forest
Products & Paper) 6,833,845
366,563 Fletcher Forestry Challenge, Ltd.
(Forest Products & Paper) 505,367
-------------
7,339,212
- ------------------------------------------------------------
Singapore--4.2%
410,000 Fraser & Neave Ltd. (Beverages &
Tobacco) 4,847,434
1,099,000 Over Seas Union Bank (Banking) 6,846,867
1,083,250 Sembawang Maritime, Ltd. (Energy
Equipment & Services) 3,665,795
- --------------------------------------------------------------------------------
- ----- 4 See Notes to Financial Statements.
<PAGE>
Portfolio of Investments as of October 31, 1995 PRUDENTIAL GLOBAL FUND, INC.
</TABLE>
<TABLE>
<CAPTION>
Shares Description Value (Note 1)
<C> <S> <C>
------------------------------------------------------------
Singapore (cont'd.)
266,000 United Overseas Bank, Ltd. (Banking) $ 2,335,150
1,737,000 Wing Tai Holdings (Property
Developement) 3,012,850
-------------
20,708,096
- ------------------------------------------------------------
Spain--2.9%
22,132 Acerinox, S.A. (Metals-Steel) 2,328,731
26,900 Banco Popular Esp (Banking) 4,270,960
236,062 Centros Commerciale (Pryca) (Retail) 5,025,680
197,000 Dragados y Construcciones
(Construction) 2,580,962
-------------
14,206,333
- ------------------------------------------------------------
Sweden--4.3%
180,600 Astra B Free (Health & Personal
Care) 6,532,630
75,000 Autoliv Ab (Automobilies & Auto
Parts) 4,306,707
84,200 Hennes & Mauritz B Free (Retail) 5,507,581
93,600 Missouri Och Domsjo AB (Forest
Products & Paper) 4,768,169
-------------
21,115,087
- ------------------------------------------------------------
Thailand--0.4%
116,202 Land & House Public Co., Ltd.
(Property Developement) 1,874,747
- ------------------------------------------------------------
United Kingdom--9.7%
319,700 Barclays Bank PLC (Banking) 3,747,729
29,000 Britannic Assured (Insurance) 323,899
1,025,800 British Sky Broadcast (Broadcasting
& Publishing) 6,150,483
319,700 Carlton Communications PLC
(Broadcasting & Publishing) 4,848,246
362,000 Commercial Union PLC (Insurance) 3,516,287
649,300 Guest Keen & Nettlefolds
(Automotive) 8,273,734
540,200 J. Sainsbury PLC (Retail) 3,606,404
688,500 Siebe PLC (Machinery & Engineering) $ 8,190,853
2,223,390 Vodafone Group PLC
(Telecommunications-Unregulated) 9,104,605
-------------
47,762,240
- ------------------------------------------------------------
United States--19.7%
288,806 Mattel, Inc. (Recreation & Other
Consumer Goods) 8,303,172
157,000 McDonald's Corp. (Food Serving-Fast
Foods) 6,437,000
290,100 MCI Communications Corp.
(Telecommunications) 7,234,369
118,500 Microsoft Corp.* (Computer Software
& Services) 11,850,000
195,100 Mirage Resorts, Inc.* (Gaming) 6,389,525
65,700 Mobil Corp. (Energy Sources) 6,619,275
141,400 Motorola, Inc. (Telecommunication
Equipment) 9,279,375
42,000 Nextel Communications, Inc.*
(Telecommunications) 582,750
208,900 Norwest Corp. (Banking) 6,162,550
165,000 Oracle Systems Corp.* (Computer
Software & Services) 7,198,125
270,700 Silicon Graphics, Inc.* (Electronic
Components) 9,000,775
67,000 Texas Instruments Inc. (Electronic
Components) 4,572,750
59,500 Tiffany & Co. (Retail) 2,595,687
121,800 Time Warner, Inc. (Entertainment) 4,445,700
138,900 Viacom Inc.* (Entertainment) 6,910,275
-------------
97,581,328
-------------
Total common stocks
(cost US$370,579,469) 468,776,921
-------------
Warrants
WARRANTS*--1.2%
- ------------------------------------------------------------
France
LaFarge Coppee,
3,500 Warrants expiring April '96 @ FF460
(Building Materials & Components) 4,226
- --------------------------------------------------------------------------------
See Notes to Financial Statements. 5 -----
<PAGE>
Portfolio of Investments as of October 31, 1995 PRUDENTIAL GLOBAL FUND, INC.
</TABLE>
<TABLE>
<CAPTION>
Warrants Description Value (Note 1)
<C> <S> <C>
------------------------------------------------------------
Japan--0.7%
Autobacs Seven Co.
400 expiring Mar. '96 @ Y8,231 (Retail) $ 755,000
Nissen Co., Ltd.
1,136 expiring Nov. '96 @ Y1,681 (Retail) 1,425,745
Nitori Co.,
5,250 expiring Feb. '98 @ Y3,268 (Retail) 535,856
Onward Kashiyama
636 expiring Mar. '96 @ Y1,169 (Textiles
& Apparel) 838,725
-------------
3,555,326
- ------------------------------------------------------------
Singapore--0.5%
United Overseas Bank, Ltd.,
666,800 expiring June '97 @ SGO1.5
(Banking) 2,525,579
-------------
Total warrants
(cost US$6,241,321) 6,085,131
-------------
Total long-term investments
(cost US$376,820,790) 474,862,052
-------------
<CAPTION>
Principal
Amount
(000) Description Value (Note 1)
<C> <S> <C>
SHORT-TERM INVESTMENTS--1.2%
- ------------------------------------------------------------
Repurchase Agreement--1.2%
USD5,880 Joint Repurchase Agreement Account,
2.93%, 11/1/95
(cost US$5,880,000; Note 5) $ 5,880,000
-------------
- ------------------------------------------------------------
Total Investments--97.3%
(cost US$382,700,790; Note 4) 480,742,052
Other assets in excess of
liabilities--2.7% 13,490,762
-------------
Net Assets--100% $ 494,232,814
-------------
-------------
- ---------------
*Non-income producing security.
ADR--American Depository Receipt
- --------------------------------------------------------------------------------
- ----- 6 See Notes to Financial Statements.
<PAGE>
Statement of Assets and Liabilities PRUDENTIAL GLOBAL FUND, INC.
- --------------------------------------------------------------------------------
</TABLE>
<TABLE>
<S>
<C>
Assets
October 31, 1995
Investments, at value (cost
$382,700,790).................................................................
$480,742,052
Foreign currency, at value (cost
$12,271,288).............................................................
12,357,550
Cash.........................................................................
............................. 161,693
Forward currency contracts--net amount receivable from
counterparties..................................... 4,787,048
Receivable for investments
sold...........................................................................
3,468,241
Dividends and interest
receivable...................................................................
...... 1,055,406
Receivable for Fund shares
sold...........................................................................
615,942
Deferred expenses and other
assets........................................................................
10,652
----------------
Total
assets.......................................................................
.................... 503,198,584
----------------
Liabilities
Payable for Fund shares
reacquired...................................................................
..... 6,952,740
Forward currency contracts--net amount payable to
counterparties.......................................... 896,982
Accrued
expenses.....................................................................
..................... 461,162
Due to
Manager......................................................................
...................... 320,126
Due to
Distributors.................................................................
...................... 262,288
Withholding taxes
payable......................................................................
........... 71,676
Deferred Thailand capital gains
tax.......................................................................
796
----------------
Total
liabilities..................................................................
.................... 8,965,770
----------------
Net
Assets.......................................................................
......................... $494,232,814
----------------
----------------
Net assets were comprised of:
Common stock, at
par..........................................................................
......... $ 324,170
Paid-in capital in excess of
par.......................................................................
364,816,144
----------------
365,140,314
Undistributed net investment
income....................................................................
3,385,062
Accumulated net realized gain on investments and foreign currency
transactions......................... 23,692,735
Net unrealized appreciation on investments and foreign
currencies...................................... 102,014,703
----------------
Net assets, October 31,
1995.........................................................................
..... $494,232,814
----------------
----------------
Class A:
Net asset value and redemption price per share
($222,002,113 / 14,304,949 shares of common stock issued and
outstanding)........................... $15.52
Maximum sales charge (5% of offering
price)............................................................
.82
Maximum offering price to
public.......................................................................
$16.34
Class B:
Net asset value, offering price and redemption price per share
($268,498,121 / 17,863,731 shares of common stock issued and
outstanding)........................... $15.03
Class C:
Net asset value, offering price and redemption price per share
($3,732,580 / 248,353 shares of common stock issued and
outstanding)................................ $15.03
</TABLE>
- --------------------------------------------------------------------------------
See Notes to Financial Statements. 7 -----
<PAGE>
PRUDENTIAL GLOBAL FUND, INC.
Statement of Operations
<TABLE>
<CAPTION>
Year Ended
Net Investment Loss October 31, 1995
<S> <C>
Income
Dividends (net of foreign withholding taxes
of $725,999)............................. $ 6,225,155
Interest.................................... 492,191
----------------
Total income............................. 6,717,346
----------------
Expenses
Management fee.............................. 3,481,921
Distribution fee--Class A................... 435,790
Distribution fee--Class B................... 2,648,693
Distribution fee--Class C................... 22,842
Transfer agent's fees and expenses.......... 1,000,000
Custodian's fees and expenses............... 759,000
Reports to shareholders..................... 250,000
Registration fees........................... 135,000
Directors' fees and expenses................ 88,000
Legal fees and expenses..................... 67,000
Audit fees and expenses..................... 52,000
Insurance expense........................... 10,000
Miscellaneous............................... 28,023
----------------
Total operating expenses................. 8,978,269
----------------
Net investment loss........................... (2,260,923)
----------------
Realized and Unrealized Gain (Loss)
on Investments and Foreign Currency
Transactions
Net realized gain on:
Investment transactions..................... 24,807,445
Foreign currency transactions............... 507,677
----------------
25,315,122
----------------
Net change in unrealized
appreciation/depreciation on:
Investments (net of change in deferred
Thailand capital gains tax of $55,905)... (2,816,898)
Foreign currencies.......................... 3,991,517
----------------
1,174,619
----------------
Net gain on investments and foreign
currencies.................................. 26,489,741
----------------
Net Increase in Net Assets
Resulting from Operations..................... $ 24,228,818
----------------
----------------
</TABLE>
PRUDENTIAL GLOBAL FUND, INC.
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Increase (Decrease) Year Ended October 31,
<S> <C> <C>
in Net Assets 1995 1994
Operations
Net investment loss............. $ (2,260,923) $ (3,531,034)
Net realized gain on investment
and foreign currency
transactions................. 25,315,122 18,037,672
Net change in unrealized
appreciation/depreciation of
investments and foreign
currencies................... 1,174,619 29,668,338
------------ ------------
Net increase in net assets
resulting from operations.... 24,228,818 44,174,976
------------ ------------
Net equalization credits.......... 712,010 193,130
------------ ------------
Distributions paid to shareholders
from net realized gains on
investment and foreign currency
transactions
Class A......................... (1,006,573) --
Class B......................... (5,394,512) --
Class C......................... (20,921) --
------------ ------------
(6,422,006) --
------------ ------------
Fund share transactions (net of
share conversions) (Note 6)
Proceeds from shares sold....... 323,054,908 373,867,022
Net asset value of shares issued
in reinvestment of
distributions................ 6,072,122 --
Cost of shares reacquired....... (338,953,005) (225,849,388)
------------ ------------
Net increase (decrease) in net
assets from Fund share
transactions................. (9,825,975) 148,017,634
------------ ------------
Total increase.................... 8,692,847 192,385,740
Net Assets
Beginning of year................. 485,539,967 293,154,227
------------ ------------
End of year....................... $494,232,814 $485,539,967
------------ ------------
------------ ------------
</TABLE>
- --------------------------------------------------------------------------------
- ----- 8 See Notes to Financial Statements.
<PAGE>
Notes to Financial Statements PRUDENTIAL GLOBAL FUND, INC.
- --------------------------------------------------------------------------------
Prudential Global Fund, Inc. (the ``Fund'') is registered under the Investment
Company Act of 1940 as a diversified, open-end management investment company.
The investment objective of the Fund is to seek long-term capital growth, with
income as a secondary objective, by investing in a diversified portfolio of
securities consisting of marketable securities of U.S. and non-U.S. issuers.
- ------------------------------------------------------------
Note 1. Accounting Policies
The following is a summary of significant accounting policies followed by the
Fund in the preparation of its financial statements.
Securities Valuation: Securities traded on an exchange (whether domestic or
foreign) are valued at the last reported sales price on the primary exchange on
which they are traded. Securities traded in the over-the-counter market
(including securities listed on exchanges for which a last sales price is not
available) are valued at the average of the last reported bid and asked prices.
Short-term securities which mature in more than 60 days are valued based upon
current market quotations. Short-term securities which mature in 60 days or less
are valued at amortized cost which approximates market value.
In connection with transactions in repurchase agreements with U.S. financial
institutions, it is the Fund's policy that its custodian or designated
subcustodians, as the case may be under triparty repurchase agreements, take
possession of the underlying collateral securities, the value of which exceeds
the principal amount of the repurchase transaction including accrued interest.
If the seller defaults and the value of the collateral declines or if bankruptcy
proceedings are commenced with respect to the seller of the security,
realization of the collateral by the Fund may be delayed or limited.
Foreign Currency Translation: The books and records of the Fund are maintained
in U.S. dollars. Foreign currency amounts are translated into U.S. dollars on
the following basis:
(i) market value of investment securities, other assets and liabilities--at the
closing daily rate of exchange as reported by a major bank;
(ii) purchases and sales of investment securities, income and expenses--at the
rate of exchange prevailing on the respective dates of such transactions.
Although the net assets of the Fund are presented at the foreign exchange rates
and market values at the close of the fiscal year, the Fund does not isolate
that portion of the results of operations arising as a result of changes in the
foreign exchange rates from the fluctuations arising from changes in the market
prices of securities held at fiscal year end. Similarly, the Fund does not
isolate the effect of changes in foreign exchange rates from the fluctuations
arising from changes in the market prices of long-term portfolio securities sold
during the fiscal year.
Net realized gains on foreign currency transactions of $507,677 represent net
foreign exchange gains or losses from holdings of foreign currencies, currency
gains or losses realized between the trade and settlement dates on security
transactions, and the difference between the amounts of dividends, interest and
foreign taxes recorded on the Fund's books and the U.S. dollar equivalent
amounts actually received or paid. Net unrealized currency gains and losses from
valuing foreign currency denominated assets and liabilities (other than
investments) at fiscal year end exchange rates are reflected as a component of
net unrealized appreciation on investments and foreign currencies.
Foreign security and currency transactions may involve certain considerations
and risks not typically associated with those of domestic origin as a result of,
among other factors, the possibility of political and economic instability and
the level of governmental supervision and regulation of foreign securities
markets.
Forward Currency Contracts: A forward currency contract is a commitment to
purchase or sell a foreign currency at a future date at a negotiated forward
rate. The Fund enters into forward currency contracts in order to hedge its
exposure to changes in foreign currency exchange rates on its foreign portfolio
holdings or on specific receivables and payables denominated in a foreign
currency. The contracts are valued daily at current exchange rates and any
unrealized gain or loss is included in net unrealized appreciation or
depreciation on investments. Gain or loss is realized on the settlement date of
the contract equal to the difference between the settlement value of the
original and renegotiated forward contracts. This gain or loss, if any, is
included in net realized gain (loss) on foreign currency transactions. Risks may
arise upon entering into these contracts from the potential inability of the
counterparties to meet the terms of their contracts.
Securities Transactions and Investment Income: Securities transactions are
recorded on the trade date. Realized gains and losses from investment and
currency transactions are calculated on the identified cost basis. Dividend
income is recorded on the ex-dividend date, and interest income is recorded on
an accrual basis.
- --------------------------------------------------------------------------------
9 -----
<PAGE>
Notes to Financial Statements PRUDENTIAL GLOBAL FUND, INC.
- --------------------------------------------------------------------------------
Net investment income (other than distribution fees) and unrealized and realized
gains or losses are allocated daily to each class of shares of the Fund based
upon the relative proportion of net assets of each class at the beginning of the
day.
Equalization: The Fund follows the accounting practice known as equalization by
which a portion of the proceeds from sales and costs of reacquisitions of Fund
shares, equivalent on a per share basis to the amount of distributable net
investment income on the date of the transaction, is credited or charged to
undistributed net investment income. As a result, undistributed net investment
income per share is unaffected by sales or reacquisitions of the Fund's shares.
Reclassification of Capital Accounts: The Fund accounts and reports for
distributions to shareholders in accordance with the American Institute
of Certified Public Accountants Statement of Position 93-2:
Determination, Disclosure, and Financial Statement Presentation
of Income, Capital Gain, and Return of Capital Distributions by Investment
Companies. The effect of applying this statement was to decrease paid-in capital
in excess of par by $1,545,933, increase undistributed net investment income by
$3,170,874, and decrease accumulated net realized gain on investments and
foreign currency transactions by $1,624,941 for the fiscal year ended October
31, 1995.
Dividends and Distributions: The Fund expects to pay dividends of net investment
income and distributions of net realized capital and currency gains, if any,
annually. Dividends and distributions are recorded on the ex-dividend date.
Income distributions and capital gain distributions are determined in accordance
with income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to differing treatments for
foreign currency transactions.
Federal Income Taxes: It is the Fund's policy to continue to meet the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to shareholders.
Therefore, no federal income tax provision is required.
Withholding taxes on foreign dividends, interest and capital gains have been
provided for in accordance with the Fund's understanding of the applicable
country's tax rules and rates.
- ------------------------------------------------------------
Note 2. Agreements
The Fund has a management agreement with Prudential Mutual Fund Management, Inc.
(``PMF''). Pursuant to this agreement, PMF has responsibility for all investment
advisory services and supervises the subadviser's performance of such services.
PMF has entered into a subadvisory agreement with The Prudential Investment
Corporation (``PIC''); PIC furnishes investment advisory services in connection
with the management of the Fund. PMF pays for the cost of the subadviser's
services, the compensation of officers of the Fund, occupancy and certain
clerical and bookkeeping costs of the Fund. The Fund bears all other costs and
expenses.
The management fee paid PMF is computed daily and payable monthly, at an annual
rate of .75 of 1% of the average daily net assets of the Fund.
The Fund has distribution agreements with Prudential Mutual Fund Distributors,
Inc. (``PMFD''), which acts as the distributor of the Class A shares of the
Fund, and with Prudential Securities Incorporated (``PSI''), which acts as
distributor of the Class B and Class C shares of the Fund (PMFD and PSI are
collectively the referred to as ``Distributors''). The Fund compensates
the Distributors for distributing and servicing the Fund's Class A,
Class B and Class C shares, pursuant to plans of distribution, (the
``Class A, B and C Plans'') regardless of expenses actually
incurred by them. The distribution fees are accrued daily and payable monthly.
Pursuant to the Class A, B and C Plans, the Fund compensates PMFD for
distribution-related activities with respect to Class A shares at an annual rate
of up to .30 of 1% of the average daily net assets of the Class A shares, .75
of
1% of the average daily net assets up to the level of average daily net assets
as of February 26, 1986, plus 1% of the average daily net assets in excess of
such level of the Class B shares and 1% of average daily net assets of Class C
shares. Payments made pursuant to the Plans were .25 of 1%, .92% of 1% and
1% of the average daily net assets of Class A, B and C shares, respectively,
for the year ended October 31, 1995.
PMFD has advised the Fund that it has received approximately $297,400 in
front-end sales charges resulting from sales of Class A shares during the year
ended October 31, 1995. From these fees, PMFD paid such sales charges to dealers
(PSI and Prusec) which in turn paid commissions to salespersons.
PSI has advised the Fund that for the year ended October 31, 1995, it received
approximately $812,000 in contingent deferred sales charges imposed upon certain
redemptions by Class B and C shareholders.
PMFD is a wholly-owned subsidiary of PMF; PSI, PMF and PIC are indirect,
wholly-owned subsidiaries of The Prudential Insurance Company of America.
- --------------------------------------------------------------------------------
- ----- 10
<PAGE>
Notes to Financial Statements PRUDENTIAL GLOBAL FUND, INC.
- --------------------------------------------------------------------------------
Note 3. Other Transactions With Affiliates
Prudential Mutual Fund Services, Inc. (``PMFS''), a wholly owned subsidiary of
PMF, serves as the Fund's transfer agent and during the year ended October 31,
1995, the Fund incurred fees of approximately $875,000 for the services of PMFS.
As of October 31, 1995, approximately $76,500 of such fees were due to PMFS.
Transfer agent fees and expenses in the Statement of Operations include certain
out-of-pocket expenses paid to non-affiliates.
For the year ended October 31, 1995, PSI and/or its foreign affiliates earned
approximately $20,800 in brokerage commissions from portfolio transactions
executed on behalf of the Fund.
- ------------------------------------------------------------
Note 4. Portfolio Securities
Purchases and sales of investment securities, other than short-term investments,
for the year ended October 31, 1995 were $229,305,275 and $246,465,097,
respectively.
The United States federal income tax basis of the Fund's investments at October
31, 1995 was $382,899,108 and accordingly, net unrealized appreciation for
federal income tax purposes was $97,842,944 (gross unrealized
appreciation--$114,097,152; gross unrealized depreciation--$16,254,208).
At October 31, 1995, the Fund had outstanding forward currency contracts, both
to purchase and sell foreign currencies, as follows:
<TABLE>
<CAPTION>
Value at
Foreign Currency Settlement Date Current
Purchase Contract Payable Value Depreciation
- -------------------- --------------- ----------- --------------
<S> <C> <C> <C>
Japanese Yen,
expiring 5/15/96-
5/30/96........... $18,989,892 $18,092,910 $ (896,982)
--------------- ----------- --------------
--------------- ----------- --------------
</TABLE>
<TABLE>
<CAPTION>
Value at
Foreign Currency Settlement Date Current
Sale Contract Receivable Value Appreciation
- ------------------- --------------- ----------- --------------
<S> <C> <C> <C>
Japanese Yen,
expiring 5/15/96
5/30/96.......... $22,879,958 $18,092,910 $4,787,048
--------------- ----------- --------------
--------------- ----------- --------------
</TABLE>
Note 5. Joint Repurchase Agreement Account
The Portfolio, along with other affiliated registered investment companies,
transfers uninvested cash balances into a single joint account, the daily
aggregate balance of which is invested in one or more repurchase agreements
collateralized by U.S. Treasury or Federal agency obligations. As of October 31,
1995, the Portfolio had a .63% undivided interest in the repurchase agreements
in the joint account. The undivided interest for the Fund represents
$5,880,000 in principal amount. As of such date, each repurchase agreement in
the joint account and the value of the collateral therefor were as follows:
Goldman Sachs & Co., 5.88%, in the principal amount of $273,000,000, repurchase
price $273,044,590, due 11/1/95. The value of the collateral including accrued
interest is $278,460,050.
CS First Boston Corp., 5.90%, in the principal amount of $273,000,000,
repurchase price $273,044,742, due 11/1/95. The value of the collateral
including accrued interest is $278,529,780.
Smith Barney Inc., 5.93%, in the principal amount of $114,753,000, repurchase
price $114,771,902, due 11/1/95. The value of the collateral including accrued
interest is $117,048,982.
Bear Stearns & Co., 5.875% in the principal amount of $273,000,000, repurchase
price $273,044,552, due 11/1/95. The value of the collateral including accrued
interest is $278,800,077.
- ------------------------------------------------------------
Note 6. Capital
The Fund offers Class A, Class B and Class C shares. Class A shares are sold
with a front-end sales charge of up to 5%. Class B shares are sold with a
contingent deferred sales charge which declines from 5% to zero depending on the
period of time the shares are held. Class C shares are sold with a contingent
deferred sales charge of 1% during the first year. Class B shares will
automatically convert to Class A shares on a quarterly basis approximately seven
years after purchase. There are 500 million shares of common stock, $.01 par
value per share, divided equally into three classes, designated Class A, Class
B
and Class C common stock.
- --------------------------------------------------------------------------------
11 -----
<PAGE>
Notes to Financial Statements PRUDENTIAL GLOBAL FUND, INC.
- --------------------------------------------------------------------------------
Transactions in shares of common stock were as follows:
<TABLE>
<CAPTION>
Class A Shares Amount
- ---------------------------------- ----------- -------------
<S> <C> <C>
Year ended October 31, 1995:
Shares sold....................... 14,310,794 $ 203,989,259
Shares issued in reinvestment of
distributions................... 73,418 983,611
Shares reacquired................. (15,121,426) (217,547,014)
----------- -------------
Net decrease in shares outstanding
before conversion............... (737,214) (12,574,144)
Shares issued upon conversion from
Class B......................... 10,085,947 130,068,677
----------- -------------
Net increase in shares
outstanding..................... 9,348,733 $ 117,494,533
----------- -------------
----------- -------------
Year ended October 31, 1994:
Shares sold....................... 8,934,836 $ 124,979,118
Shares reacquired................. (7,169,344) (100,448,720)
----------- -------------
Net increase in shares
outstanding..................... 1,765,492 $ 24,530,398
----------- -------------
----------- -------------
<CAPTION>
Class B
- ----------------------------------
<S> <C> <C>
Year ended October 31, 1995:
Shares sold....................... 8,422,470 $ 116,118,701
Shares issued in reinvestment of
distributions................... 390,179 5,070,014
Shares reacquired................. (8,836,648) (120,783,109)
----------- -------------
Net decrease in shares outstanding
before conversion............... (23,999) 405,606
Shares reacquired upon conversion
into Class A.................... (10,370,444) (130,068,677)
----------- -------------
Net decrease in shares
outstanding..................... (10,394,443) $(129,663,071)
----------- -------------
----------- -------------
Year ended October 31, 1994:
Shares sold....................... 17,971,424 $ 247,670,808
Shares reacquired................. (9,114,786) (125,372,515)
----------- -------------
Net increase in shares
outstanding..................... 8,856,638 $ 122,298,293
----------- -------------
----------- -------------
<CAPTION>
Class C Shares Amount
- ---------------------------------- ----------- -------------
<S> <C> <C>
Year ended October 31, 1995:
Shares sold....................... 210,290 $ 2,946,948
Shares issued in reinvestment of
distributions................... 1,419 18,497
Shares reacquired................. (46,329) (622,882)
----------- -------------
Net increase in shares
outstanding..................... 165,380 $ 2,342,563
----------- -------------
----------- -------------
August 3, 1994* through
October 31, 1994:
Shares sold....................... 84,982 $ 1,217,096
Shares reacquired................. (2,009) (28,153)
----------- -------------
Net increase in shares
outstanding..................... 82,973 $ 1,188,943
----------- -------------
----------- -------------
- ---------------
* Commencement of offering of Class C shares.
</TABLE>
- ------------------------------------------------------------
Note 7. Dividends and Distributions
On December 7, 1995, the Board of Trustees of the Fund declared a long term
capital gain distribution of $0.715 per share for class A, B and C shares
respectively, payable on December 15, 1995 to shareholders of record
on December 12, 1995:
- --------------------------------------------------------------------------------
- ----- 12
<PAGE>
Financial Highlights PRUDENTIAL GLOBAL FUND, INC.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Class A
- ------------------------------------------------------------
<S> <C> <C>
<C> <C> <C>
Year
Ended October 31,
- ------------------------------------------------------------
1995 1994
1993 1992 1991
<CAPTION>
----------- --------
------- ------- -------
<S> <C> <C>
<C> <C> <C>
PER SHARE OPERATING PERFORMANCE(a):
Net asset value, beginning of year............... $ 14.89 $ 13.17
$ 9.58 $ 10.08 $ 9.19
----------- --------
------- ------- -------
Income from investment operations
Net investment income (loss)..................... .01 (.04)
.02 .03 .07
Net realized and unrealized gain (loss) on
investment and foreign currency
transactions.................................. .81 1.76
3.57 (.53) 1.02
----------- --------
------- ------- -------
Total from investment operations............... .82 1.72
3.59 (.50) 1.09
----------- --------
------- ------- -------
Less distributions
Dividends from net investment income............. -- --
-- -- (.16)
Distributions paid to shareholders from net
realized gains on investment and foreign
currency transactions......................... (.19) --
-- -- (.04)
----------- --------
------- ------- -------
Total distributions............................ (.19) --
-- -- (.20)
----------- --------
------- ------- -------
Net asset value, end of year..................... $ 15.52 $ 14.89
$ 13.17 $ 9.58 $ 10.08
----------- --------
------- ------- -------
----------- --------
------- ------- -------
TOTAL RETURN(b):................................. 5.74% 13.06%
37.47% (4.96)% 12.11%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year (000).................... $ 222,002 $ 73,815
$42,021 $13,973 $14,154
Average net assets (000)......................... $ 174,316 $ 58,455
$21,409 $14,758 $10,593
Ratios to average net assets:
Expenses, including distribution fees.......... 1.51% 1.55%
1.56% 1.71% 1.72%
Expenses, excluding distribution fees.......... 1.26% 1.30%
1.36% 1.51% 1.52%
Net investment income (loss)................... .10% (0.29)%
0.20% 0.22% 0.65%
Portfolio turnover rate.......................... 50% 49%
69% 58% 126%
</TABLE>
- ---------------
(a) Based on average shares outstanding, by class.
(b) Total return does not consider the effects of sales loads. Total
return is calculated assuming a purchase of shares on the first day
and a sale on the last day of each period reported and includes
reinvestment of dividends and distributions.
- --------------------------------------------------------------------------------
See Notes to Financial Statements. 13 -----
<PAGE>
Financial Highlights PRUDENTIAL GLOBAL FUND, INC.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Class B
- ---------------------------------------------------------------
Year
Ended October 31,
- ---------------------------------------------------------------
1995 1994
1993 1992 1991
<S> <C> <C>
<C> <C> <C>
----------- --------
-------- -------- --------
PER SHARE OPERATING PERFORMANCE(a):
Net asset value, beginning of period............. $ 14.53 $ 12.94
$ 9.47 $ 10.05 $ 9.14
----------- --------
-------- -------- --------
Income from investment operations
Net investment loss.............................. (.11) (.13)
(.04) (.05) --
Net realized and unrealized gain (loss) on
investment and foreign currency
transactions.................................. .80 1.72
3.51 (.53) 1.02
----------- --------
-------- -------- --------
Total from investment operations............... .69 1.59
3.47 (.58) 1.02
----------- --------
-------- -------- --------
Less distributions
Dividends from net investment income............. -- --
-- -- (.07)
Distributions paid to shareholders from net
realized gains on investment and foreign
currency transactions......................... (.19) --
-- -- (.04)
----------- --------
-------- -------- --------
Total distributions............................ (.19) --
-- -- (.11)
----------- --------
-------- -------- --------
Net asset value, end of period................... $ 15.03 $ 14.53
$ 12.94 $ 9.47 $ 10.05
----------- --------
-------- -------- --------
----------- --------
-------- -------- --------
TOTAL RETURN(b):................................. 4.98% 12.29%
36.64% (5.77)% 11.29%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000).................. $ 268,498 $410,520
$251,133 $178,438 $249,582
Average net assets (000)......................... $ 287,656 $345,771
$183,741 $210,464 $253,866
Ratios to average net assets:
Expenses, including distribution fees.......... 2.19% 2.24%
2.24% 2.40% 2.44%
Expenses, excluding distribution fees.......... 1.27% 1.30%
1.36% 1.51% 1.53%
Net investment loss............................ (.84)% (0.97)%
(0.39)% (0.47)% (0.01)%
Portfolio turnover rate.......................... 50% 49%
69% 58% 126%
<CAPTION>
Class C
August 1,
Year Ended Through
October 31, October 31,
1995 1994
<S> <C> <C>
------------ -----------
PER SHARE OPERATING PERFORMANCE(a):
Net asset value, beginning of period............. $ 14.53 $ 14.03
------------ -----------
Income from investment operations
Net investment loss.............................. (.11) (.03)
Net realized and unrealized gain (loss) on
investment and foreign currency
transactions.................................. .80 .53
------------ -----------
Total from investment operations............... .69 .50
------------ -----------
Less distributions
Dividends from net investment income............. -- --
Distributions paid to shareholders from net
realized gains on investment and foreign
currency transactions......................... (.19) --
------------ -----------
Total distributions............................ (.19) --
------------ -----------
Net asset value, end of period................... $ 15.03 $ 14.53
------------ -----------
------------ -----------
TOTAL RETURN(b):................................. 4.98% 3.56%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000).................. $ 3,733 $ 1,205
Average net assets (000)......................... $ 2,284 $ 630
Ratios to average net assets:
Expenses, including distribution fees.......... 2.25%
2.63%(c)
Expenses, excluding distribution fees.......... 1.25%
1.63%(c)
Net investment loss............................ (.76)%
(1.21)%(c)
Portfolio turnover rate.......................... 50% 49%
</TABLE>
- ---------------
(a) Based on average shares outstanding, by class.
(b) Total return does not consider the effects of sales loads. Total
return is calculated assuming a purchase of shares on the first day
and a sale on the last day of each period reported and includes
reinvestment of dividends and distributions. Total returns for
periods of less than a full year are not annualized.
(c) Annualized.
(d) Commencement of offering of Class C shares.
- --------------------------------------------------------------------------------
- ----- 14 See Notes to Financial Statements.
<PAGE>
Independent Auditors' Report PRUDENTIAL GLOBAL FUND, INC.
- --------------------------------------------------------------------------------
The Shareholders and Board of Directors
Prudential Global Fund, Inc.
We have audited the accompanying statement of assets and liabilities including
the portfolio of investments, of Prudential Global Fund, Inc., as of October 31,
1995, the related statements of operations for the year then ended and of
changes in net assets for each of the two years in the period then ended, and
the financial highlights for each of the five years in the period then ended.
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 the securities owned as of
October 31, 1995 by correspondence with the custodian. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of Prudential Global
Fund, Inc. as of October 31, 1995, the results of its operations, the changes
in
its net assets, and its financial highlights for the respective stated periods,
in conformity with generally accepted accounting principles.
DELOITTE & TOUCHE LLP
New York, New York
December 13, 1995
Tax Information PRUDENTIAL GLOBAL FUND, INC.
- --------------------------------------------------------------------------------
As required by the Internal Revenue Code, we are to advise you within 60 days
of
the Fund's fiscal year end (October 31, 1995) as to the federal tax status of
dividends and distributions paid by the Fund.
During the fiscal year ended October 31, 1995, the Fund paid a long-term capital
gains distribution for Class A, Class B and Class C Shares of $.19 per share
(taxable as capital gains income). We wish to advise you that the corporate
dividends received deduction for the Fund is zero.
For the purpose of preparing your annual federal income tax return, however, you
should report the amounts as reflected on the appropriate Form 1099-DIV or
substitute 1099-DIV.
<PAGE>
Getting The Most From Your
Prudential Mutual Fund
When you invest through Prudential Mutual Funds, you receive financial advice
through a Prudential Securities financial advisor or Prudential/Pruco
Securities registered representative. Your advisor or representative can
provide you with the following services:
There's No Reward Without Risk; But Is This Risk Worth It?
Your financial advisor or registered representative can help you match the
reward you seek with the risk you can tolerate. And risk can be difficult to
gauge -- sometimes even the simplest investments bear surprising risks. The
educated investor knows that markets seldom move in just one direction -- there
are times when a market sector or asset class will lose value or provide little
in the way of total return. Managing your own expectations is easier with help
from someone who understands the markets and who knows you!
Keeping Up With The Joneses.
A financial advisor or registered representative can help you wade through the
numerous mutual funds available to find the ones that fit your own individual
investment profile and risk tolerance. While the newspapers and popular
magazines are full of advice about investing, they are aimed at generic groups
of people or representative individuals, not at you personally. Your financial
advisor or registered representative will review your investment objectives
with you. This means you can make financial decisions based on the assets and
liabilities in your current portfolio and your risk tolerance -- not just based
on the current investment fad.
Buy Low, Sell High.
Buying at the top of a market cycle and selling at the bottom are among the
most common investor mistakes. But sometimes it's difficult to hold on to an
investment when it's losing value every month. Your financial advisor or
registered representative can answer questions when you're confused or worried
about your investment, and remind you that you're investing for the long haul.
<PAGE>
The Prudential Global Fund and the Morgan Stanley Capital
International World Index: Comparing a $10,000 Investment.
Class A
Average Annual (CHART)
Total Returns
With Sales Load
6.9% Since Inception
10.7% for 5 Years
.5% for 1 Year
Without Sales Load
7.9% Since Inception
11.9% for 5 Years
5.7% for 1 Year
Class B
Average Annual (CHART)
Total Returns
With Sales Load
13.2% Since Inception
11.4% for 10 Years
10.9% for 5 Years
- -.02% for 1 Year
Without Sales Load
13.2% Since Inception
11.4% for 10 Years
11.1% for 5 Years
5.0% for 1 Year
Class C
Average Annual (CHART)
Total Returns
With Sales Load
6.9% Since Inception
4.0% for 1 Year
Without Sales Load
6.9% Since Inception
5.0% for 1 Year
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate so an investor's shares, when redeemed, will be
worth more or less than their original cost. The charts on the right are
designed to give you an idea how much the Fund's returns can fluctuate from
year to year by measuring the best and worst calendar years in terms of total
annual return since inception of each share class.
These graphs are furnished to you in accordance with SEC regulations. They
compare a $10,000 investment in the Prudential Global Fund (Class A, Class B
and Class C) with a similar investment in the Morgan Stanley Capital
International World Index by portraying the initial account values at the
commencement of operations of Class A and Class C shares and for 10 years for
Class B shares, and subsequent account values at the end of this reporting
period (October 31), as measured on a quarterly basis, beginning in 1990 for
Class A shares, in 1985 for Class B shares and in 1994 for Class C shares. For
purposes of the graphs, and unless otherwise indicated, in the accompanying
tables it has been assumed (a) that the maximum applicable front-end sales
charge was deducted from the initial $10,000 investment in Class A shares; (b)
the maximum applicable contingent deferred sales charge was deducted from the
value of the investment in Class B and Class C shares, assuming full redemption
on October 31, 1995; (c) all recurring fees (including management fees) were
deducted; and (d) all dividends and distributions were reinvested. Class B
shares will automatically convert to Class A shares, on a quarterly basis,
beginning approximately seven years after purchase. This conversion feature is
not reflected in the graph.
The Morgan Stanley World Index is a weighted index comprised of approximately
1,472 securities listed on the stock exchanges of the U.S., Europe, Canada,
Australia, New Zealand and the Far East. The World Index is an unmanaged index
and includes the reinvestment of all dividends, but does not reflect the
payment of transaction costs and advisory fees associated with an investment in
the Fund. The securities in the World Index may differ substantially from the
securities in the Fund. The World Index is not the only index that may be used
to characterize performance of stock funds and other indexes may portray
different comparative performance.
<PAGE>
Prudential Mutual Funds
One Seaport Plaza
New York, NY 10292
Toll Free (800) 225-1852
Internet Address:
http:\\www.prudential.com
(LOGO)
Directors
Stephen C. Eyre
Delayne D. Gold
Don G. Hoff
Harry A. Jacobs, Jr.
Sidney R. Knafel
Robert E. LaBlanc
Thomas A. Owens, Jr.
Richard A. Redeker
Clay T. Whitehead
Officers
Richard A. Redeker, President
David W. Drasnin, Vice President
Robert F. Gunia, Vice President
Grace C. Torres, Treasurer
Stephen M. Ungerman, Assistant Treasurer
S. Jane Rose, Secretary
Ellyn C. Acker, Assistant Secretary
Manager
Prudential Mutual Fund Management, Inc.
One Seaport Plaza
New York, NY 10292
Investment Adviser
The Prudential Investment Corporation
Prudential Plaza
Newark, NJ 07101
Distributors
Prudential Mutual Fund Distributors, Inc.
Prudential Securities Incorporated
One Seaport Plaza
New York, NY 10292
Custodian
State Street Bank and Trust Company
One Heritage Drive
North Quincy, MA 02171
Transfer Agent
Prudential Mutual Fund Services, Inc.
P.O. Box 15005
New Brunswick, NJ 08906
Independent Accountants
Deloitte & Touche LLP
Two World Financial Center
New York, NY 10281
Legal Counsel
Sullivan & Cromwell
125 Broad Street
New York, NY 10004
This report is not authorized for distribution to prospective investors unless
preceded or accompanied by a current prospectus.
744332107 MF115E
744332206 Cat. #44014AY
744332305
