FINANCIAL STATEMENTS
Following are the audited financial statements for the initial capitalization of
the John Hancock Growth Trends Fund and the report of PricewaterhouseCoopers LLP
dated August 10, 2000.
John Hancock Growth Trends Fund
Statement of Assets and Liabilities
August 1, 2000
Assets:
Cash $105,000
Deferred offering costs 104,000
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Total assets 209,000
Liabilities:
Payable for organizational costs 5,000
Payable for offering costs 104,000
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Total liabilities 109,000
Net Assets:
Paid in Capital 105,000
Undistributed net investment loss (5,000)
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Net Assets 100,000
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Net assets value per share:
(Based on net assets and shares of
beneficial interest outstanding -
unlimited number of shares authorized
with no par value)
Class A ($33,334/3,334) $10.00
Class B ($33,333/3,333) $10.00
Class C ($33,333/3,333) $10.00
Statement of Operations
for the period ended
August 1, 2000
Expenses:
Organizational costs $5,000
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Net Loss ($5,000)
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NOTES TO STATEMENT OF ASSETS AND LIABILITIES
Note 1. John Hancock Growth Trends Fund (the "Fund") is a newly organized
diversified series of John Hancock Equity Trust (formerly known as John Hancock
Special Equities Fund), an open-end management investment company, registered
under the Investment Company Act of 1940. The Fund may issue an unlimited number
of shares. The Fund offers three classes of shares - Classes A, B and C. Only
shares of beneficial interest of the Fund have been issued.
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The Fund's investment objective is to achieve long-term growth of capital. The
Fund will invest in a number of industry groups without concentration in any
particular industry.
At August 1, 2000, the Fund is inactive except for matters relating to its
organization and registration as an open-end investment company under the
Investment Company Act of 1940, and the sale of 10,000 shares for $105,000 to
John Hancock Advisers, Inc (the "Adviser"), an indirect, wholly-owned subsidiary
of John Hancock Life Insurance Company ("JHLICo"). Organizational costs, which
amount to $5,000, have been borne by the Fund. Offering costs have been deferred
and will be charged to the Fund's operations ratably over a twelve-month period
from the date upon which the Fund commences its investment activities.
Note 2. The Fund has entered into an investment management contract with the
Adviser. Upon commencement of the Fund's operations, the Adviser will receive a
monthly management fee from the Fund for a continuous investment program,
equivalent on an annual basis to 1.00% of the Fund's average daily net asset
value.
The Fund has an agreement with the Adviser whereby the Adviser performs
necessary tax, accounting and legal services for the Fund. The Adviser has
voluntarily agreed to limit the Fund's total expenses (excluding distribution
fees) to 1.35% for Class A, Class B and Class C shares through February 28,
2002.
The Fund has a distribution agreement with John Hancock Funds, Inc., a wholly
owned subsidiary of the Adviser. The Fund has adopted a distribution plan for
each class of shares as stated in the "Your Account" section in the Prospectus.
The Fund has a transfer agent agreement with John Hancock Signature Services,
Inc. ("Signature Services"), an indirect subsidiary of JHLICo. The Fund pays the
Signature Services a transfer agent fee based on the number of shareholder
accounts and certain out-of-pocket expenses.
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Report of Independent Accountants
To the Shareholders and Board of Trustees of
John Hancock Growth Trends Fund
In our opinion, the accompanying statement of assets and liabilities and the
related statement of operations present fairly, in all material respects, the
financial position of John Hancock Growth Trends Fund (the "Fund") at August 1,
2000, and the results of its operations for the period ended August 1, 2000 in
conformity with accounting principles generally accepted in the United States.
These financial statements are the responsibility of the Fund's management; our
responsibility is to express an opinion on these financial statements based on
our audit. We conducted our audit of these financial statements in accordance
with auditing standards generally accepted in the United States, which require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for the opinion expressed above.
/s/PricewaterhouseCoopers LLP
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Boston, Massachusetts
August 10, 2000
