<PAGE> 1
EATON VANCE MUNICIPALS TRUST
FOR THE FUNDS:
- EV Traditional California Municipals Fund
- EV Traditional Florida Municipals Fund
- EV Traditional Massachusetts Municipals Fund
- EV Traditional Mississippi Municipals Fund
- EV Traditional New York Municipals Fund
- EV Traditional Ohio Municipals Fund
- EV Traditional West Virginia Municipals Fund
- --------------------------------------------------------------------------------
[GRAPHIC OF A DOOR]
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ANNUAL SHAREHOLDER REPORT
SEPTEMBER 30, 1996
<PAGE> 2
TABLE OF CONTENTS
ITEM PAGE
Year-end results, listed by state............................. 2
President's letter to shareholders............................ 3
Management Reports:
EV Traditional California Municipals Fund............. 4
EV Traditional Florida Municipals Fund................ 5
EV Traditional Massachusetts Municipals Fund.......... 6
EV Traditional Mississippi Municipals Fund............ 7
EV Traditional New York Municipals Fund............... 8
EV Traditional Ohio Municipals Fund................... 9
EV Traditional West Virginia Municipals Fund.......... 10
Financial Results..................................... 11
INFORMATION ABOUT YOUR MUTUAL FUND INVESTMENT
RESULTS FOR THE YEAR ENDED: SEPTEMBER 30, 1996
<TABLE>
<CAPTION>
FINANCIAL DATA:
- ---------------------------------------------------------------------------------
Fund's
Total return Dividends distribution
(excl. sales paid by Fund NAV per share rate
charge) (during period) at 9/30/96 at 9/30/96
- ---------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
EV Traditional
CALIFORNIA
Municipals Fund 8.1% $0.604 $10.38 5.78%
EV Traditional
FLORIDA
Municipals Fund 6.6% $0.592 $10.53 5.56%
EV Traditional
MASSACHUSETTS
Municipals Fund 6.2% $0.522 $ 9.30 5.76%
EV Traditional
MISSISSIPPI
Municipals Fund 6.6% $0.485 $ 9.42 5.31%
EV Traditional
NEW YORK
Municipals Fund 6.7% $0.595 $10.22 5.72%
EV Traditional
OHIO
Municipals Fund 6.1% $0.500 $ 9.38 5.47%
EV Traditional
WEST VIRGINIA
Municipals Fund 6.5% $0.491 $ 9.45 5.34%
<CAPTION>
TAX DATA:
- --------------------------------------------------------------------------------------
The after-tax
equivalent
If your combined distribution
Federal & state rate you Tax
tax rate is... would need is.. Information*
- --------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
EV Traditional
CALIFORNIA
Municipals Fund [GRAPHIC STATE 43.04% 10.09% 98.73%
OF CALIFORNIA]
EV Traditional
FLORIDA
Municipals Fund [GRAPHIC STATE 41.73% 9.47% 98.36%
OF FLORIDA]
EV Traditional
MASSACHUSETTS
Municipals Fund [GRAPHIC STATE 43.68% 10.19% 99.05%
OF MASSACHUSETTS]
EV Traditional
MISSISSIPPI
Municipals Fund [GRAPHIC STATE 39.20% 8.68% 98.46%
OF MISSISSIPPI]
EV Traditional
NEW YORK
Municipals Fund [GRAPHIC STATE 40.56% 9.56% 98.17%
OF NEW YORK]
EV Traditional
OHIO
Municipals Fund [GRAPHIC STATE 40.80% 9.22% 99.44%
OF OHIO]
EV Traditional
WEST VIRGINIA
Municipals Fund [GRAPHIC STATE 40.16% 8.89% 98.94%
OF WEST VIRGINIA]
- --------------------------------------------------------------------------------------
</TABLE>
*Percentages represent the amounts of the total dividends paid by the Funds
from net investment income during the year ended September 30, 1996 that have
been designated as exempt-interest dividends. Tax legislation eliminated the
exception to market discount rules applicable to tax-exempt obligations. As a
result, certain tax-exempt obligations acquired by the Portfolio subsequent to
April 30, 1993 at market discounts may generate a small amount of ordinary
taxable income.
Fund shares are not guaranteed by the FDIC and are not deposits or other
obligations of, or guaranteed by, any depository institution. Shares are
subject to investment risks, including possible loss of principal invested.
2
<PAGE> 3
TO SHAREHOLDERS
Following an upbeat year in 1995, the bond market encountered difficulty in the
first half of 1996. The year started favorably enough, with the Federal Reserve
lowering the Federal Funds Rate - the rate banks charge each other for overnight
loans and a key short-term interest rate barometer - to 5.25%. Investors'
optimism was short-lived, however, as Fed Chairman Alan Greenspan suggested in
his spring Congressional testimony that, in light of current economic growth,
the next move in rates could possibly be higher. By mid-summer, employment data
showed that job creation was exceeding market estimates, and that the labor
market was indeed tightening.
The fall brought news that job growth had cooled from the blistering pace set
early in the year, and that inflation was still not a threat. However, the
economic data still have failed to give a clear indication of the economy's
future direction. Accordingly, the Federal Reserve effectively put its monetary
policy on hold until after the November elections.
An investment in municipal bonds continues to represent good value for
tax-conscious investors for several reasons. First, while turning in somewhat
faster growth than expected, the nation's economy remains subdued. GDP grew at a
4.8% rate in the second quarter - a relatively strong showing, but one not
likely to be sustained over the balance of the year. Recent indicators suggest a
possible slowdown in the second half of the year, and, more importantly,
inflation remains well under control.
Second, whatever the outcome of the various tax cut proposals that have marked
the campaign of both major political parties, it is certain that the tax
structure will remain sharply progressive. That means that municipal bonds
should retain their relative value.
Third, on the budget front, the deficit has been reduced significantly. At
present, the deficit as a percentage of GDP is the smallest of all
industrialized nations, alleviating near-term borrowing needs.
TAX-EXEMPT BONDS YIELD 81% OF TREASURY YIELDS
<TABLE>
<S> <C>
30-YR. AAA GENERAL OBLIGATION (G0) BONDS* 5.61%
TAXABLE EQUIVALENT YIELD OF INVESTMENT
FOR COUPLE IN 36% TAX BRACKET 8.77%
30-YEAR TREASURY BONDS 6.92%
</TABLE>
Principal and interest payments of Treasury securities are guaranteed by the
U.S. government.
*GO yield is a compilation of a representative variety of general obligation
bonds and is not necessarily represented by the Fund's yield. Statistics as of
September 30, 1996. Past performance is no guarantee of future results.
Source: Bloomberg, L.P.
Finally, and perhaps most important of all, the tax burden of our citizens is
still extraordinarily high. Municipal bonds remain one of the better ways for
most individuals to relieve that burden and keep more of what they work so hard
to earn. We believe that, despite the occasional market fluctuations, a
steadfast, long-term outlook is the best way to reap the advantages of tax-free
investing.
[PHOTO OF THOMAS J. FETTER]
Sincerely
/s/ Thomas J. Fetter
Thomas J. Fetter
President
November 4, 1996
Included in the pages that follow are performance charts that compare your
Fund's total return with that of a broad-based securities market index. The
lines on the chart represent the total returns of $10,000 hypothetical
investments in your Fund and the unmanaged Lehman Brothers Municipal Bond Index.
The solid line on the chart represents the Fund's performance. The Fund's total
return figure reflects fund expenses and portfolio transaction costs, and
assumes the reinvestment of income dividends and capital gain distributions. The
maximum sales charge, which the charts refer to, is 4.75% and is deducted at the
time of initial investment. The dotted line represents the performance of the
Lehman Brothers Municipal Bond Index, a broad-based, widely recognized unmanaged
index of municipal bonds. Whereas the Fund's portfolio is composed principally
of bonds solely from your individual state, the Index is composed of bonds from
all 50 states and many jurisdictions. The Index's total return does not reflect
any commissions or expenses that would be incurred if an investor individually
purchased or sold the securities represented in the Index. It is not possible to
invest directly in the Lehman Brothers Municipal Bond Index.
3
<PAGE> 4
EV TRADITIONAL CALIFORNIA MUNICIPALS FUND
YOUR INVESTMENT AT WORK
[GRAPHIC OF HARDHAT WORKER]
Moulton Niguel Water District
General Obligation Bonds
The proceeds from this bond issue will help maintain and upgrade the water
supply facilities of the Moulton Niguel Water District, a 23,135 acre area
located in southwestern Orange County and including the cities and towns such as
Alisa Viego, Laguna Niguel, Mission Viejo, Laguna Hills, and Dana Point. The
District's sale of water provides a reliable source of cash flow for repayment
in addition to serving a vital need.
The District imports all of its water from the Metropolitan Water District of
Southern California (MWD). The MWD, in turn, is supplied primarily by water from
the Colorado River and from the Sacramento-San Joachin Delta via the 444-mile
long California Aqueduct.
[GRAPHIC OF CALIFORNIA]
<TABLE>
<CAPTION>
PORTFOLIO OVERVIEW
Based on market value as of September 30, 1996
<S> <C>
Number of issues.............................................94
Average quality..............................................A+
Investment grade...........................................89.9%
Effective maturity...................................14.12 yrs.
Largest sectors:
Lease/certificate of participation......................21.8%
Escrowed................................................17.1
Special tax.............................................12.8
Housing..................................................7.7
Transportation...........................................6.8
Cogeneration.............................................6.0
</TABLE>
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THE STATE OF THE STATE: California
California's economy has had a difficult time since it was hit by the recession
of 1991-1992. Total state employment just recently reached the pre-recession
peak of 14.5 million recorded in mid-1990. Employment growth, however, has been
sporadic. Annualized growth this year has ranged from 2.0% to 2.5%. In 1994, the
state added 256,000 jobs, while only 89,000 were added in 1995. Much of the job
growth has taken place in the San Francisco Bay Area, where unemployment dropped
to 4.3% in July of 1996, a decline of 1.5% over the preceding 12 months. By
contrast, unemployment in the Los Angeles Area was 7.25%, a slight increase over
the same 12-month period. Overall, the state's unemployment was 7.1% in June,
1996, which was above the national average. Wages have also fallen, indicating
the continuing effects of the declining aerospace industry.
Financially, California's tax revenues have improved with the recovery, but the
state remains burdened with structural budget problems - most notably, an
increase in school funding and mandatory criminal sentencing. Should revenues
decline, these legislated programs could have an adverse effect on the budget.
Nevertheless, the overall economic picture in California has brightened enough
to warrant a rating increase from "A" to "A+" by Standard & Poor's.
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COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT IN EV TRADITIONAL
CALIFORNIA MUNICIPALS FUND (INCLUDING SALES CHARGE) AND THE LEHMAN BROTHERS
MUNICIPAL BOND INDEX
FROM MAY 31, 1994, THROUGH SEPTEMBER 30, 1996
<TABLE>
<CAPTION>
Average 1 Life of
Annual Returns Year Fund*
- -----------------------------------
<S> <C> <C>
With Max. SC 4.0% 6.1%
- -----------------------------------
Without SC 8.1% 7.8%
- -----------------------------------
</TABLE>
Lehman Brothers Municipal Bond Index: $11,974
EV TRADITIONAL CALIFORNIA MUNICIPALS FUND: $11,798
Fund incl. max. sales charge: $11,523
EV Traditional California Municipals Fund vs.
Lehman Brothers 7-Year Municipal Bond Index
<TABLE>
<CAPTION>
Date Fund @ NAV Fund w/SC Index
<S> <C> <C> <C>
5/31/94 $10,000 $ 9,624 $10,000
6/30/94 $10,008 $ 9,631 $ 9,942
7/31/94 $10,181 $ 9,798 $10,121
8/31/94 $10,223 $ 9,838 $10,156
9/30/94 $10,080 $ 9,700 $10,007
10/31/94 $ 9,907 $ 9,534 $ 9,830
11/30/94 $ 9,670 $ 9,306 $ 9,652
12/31/94 $ 9,847 $ 9,477 $ 9,864
1/31/95 $10,213 $ 9,829 $10,146
2/28/95 $10,544 $10,147 $10,441
3/31/95 $10,682 $10,280 $10,561
4/30/95 $10,672 $10,270 $10,574
5/31/95 $11,034 $10,619 $10,911
6/30/95 $10,820 $10,413 $10,816
7/31/95 $10,886 $10,476 $10,918
8/31/95 $10,985 $10,571 $11,057
9/30/95 $11,082 $10,665 $11,126
10/31/95 $11,334 $10,907 $11,288
11/30/95 $11,618 $11,181 $11,476
12/31/95 $11,795 $11,351 $11,586
1/31/96 $11,841 $11,395 $11,673
2/28/96 $11,761 $11,318 $11,595
3/31/96 $11,573 $11,137 $11,446
4/30/96 $11,528 $11,094 $11,414
5/31/96 $11,540 $11,106 $11,410
6/30/96 $11,641 $11,203 $11,534
7/31/96 $11,778 $11,335 $11,638
8/31/96 $11,791 $11,347 $11,636
9/30/96 $11,974 $11,523 $11,798
</TABLE>
Past performance is not indicative of future results. Investment returns and
principal will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than their original cost. Source: Towers Data Systems,
Bethesda, MD. *Investment operations commenced 5/27/94. +Index information is
available only at month-end; therefore, the line comparison begins at the next
month-end following the commencement of the Fund's investment operations.
FROM THE PORTFOLIO MANAGER:
[PHOTO OF CYNTHIA J. CLEMSON]
"Growth in the California economy, though not outstanding, has been sufficient
to warrant a rating increase in the state's general obligation bonds. As a
result, the California-backed bonds that this Portfolio holds, such as
California Public Works, have appreciated nicely.
"To increase the yield of the Portfolio, I have added positions in San Bernadino
Community Hospital bonds, as well as those of the Sacramento Power Authority
Cogeneration Project. To help the Fund's total return, I continually focus on
Portfolio structure, which includes increasing call protection and choosing the
appropriate coupon and maturity characteristics."
- Cynthia J. Clemson
4
<PAGE> 5
EV TRADITIONAL FLORIDA MUNICIPALS FUND
YOUR INVESTMENT AT WORK
Florida Municipal Power Agency -
Stanton II Project [GRAPHIC OF POWER LINES]
The proceeds from this bond issue are being used to fund the Florida Municipal
Power Agency's partial ownership interest in the Stanton II Project, a 420
megawatt, coal-fired electric generating facility.
This power facility, which will provide power to cities and towns throughout the
state of Florida, was scheduled to be in service in June, 1996. The Stanton II
project is operated by the Orlando Utilities Commission (OUC), which was also
responsible for its construction.
[GRAPHIC OF FLORIDA]
<TABLE>
<CAPTION>
PORTFOLIO OVERVIEW
Based on market value as of September 30, 1996
<S> <C>
Number of issues...........................125
Average quality............................AA-
Investment grade..........................79.7%
Effective maturity..................15.97 yrs.
Largest sectors:
Housing................................13.6%
Utilities..............................12.9
General obligations....................10.0
Special tax revenue.....................7.7
Escrowed................................7.4
Insured hospital........................6.8*
</TABLE>
*Private insurance does not remove the market risks that are associated with
these investments.
- --------------------------------------------------------------------------------
THE STATE OF THE STATE: Florida
Florida's economy has grown steadily since 1993, led by a strong service sector
which comprises over one-third of the state's employment and consists mainly of
health and business services. Total employment increased by 5% from 1993 to
1995, and the unemployment rate decreased from 8.2% in 1992 to 5.3% at the end
of last year. Other strong sectors include construction and trade which, along
with service, account for two-thirds of employment in Florida. Tourism was hit
hard by the recession in the early 1990s, but has rebounded strongly in the past
few years. The tourism industry provides the foundation for much of the state's
economy and is expected to grow by 4.3% through fiscal 1997, according to
Standard & Poor's.
Though dependent on a cyclical 6% sales and use tax, Florida's finances are well
managed and the state maintains a healthy working capital reserve. Governor
Chiles has proposed bond issuance totalling $1.14 billion for fiscal 1997 which
will provide funding in four main areas: Public Education, Environmental
Preservation, Right-of-Way Acquisition, and Prison and Detention. As required by
law, all bond issues must be backed by a specific revenue stream to receive the
"full faith and credit" approval from the Florida state government.
- --------------------------------------------------------------------------------
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT IN
EV TRADITIONAL FLORIDA MUNICIPALS FUND (INCLUDING SALES CHARGE)
AND THE LEHMAN BROTHERS MUNICIPAL BOND INDEX
FROM APRIL 30, 1994, THROUGH SEPTEMBER 30, 1996
<TABLE>
<CAPTION>
Average 1 Life of
Annual Returns Year Fund*
- -------------------------------------
<S> <C> <C>
With Max. SC 2.5% 6.5%
- -------------------------------------
Without SC 6.6% 8.1%
- -------------------------------------
</TABLE>
Lehman Brothers Municipal Bond Index: $11,900
EV TRADITIONAL FLORIDA MUNICIPALS FUND: $11,793
Fund incl. max. sales charge: $11,352
EV Traditional Florida Municipals Fund vs.
Lehman Brothers 7-Year Municipal Bond Index
<TABLE>
<CAPTION>
Date Fund @ NAV Fund w/SC Index
<S> <C> <C> <C>
4/30/94 $10,000 $ 9,626 $10,000
5/31/94 $10,061 $ 9,685 $10,087
6/30/94 $10,001 $ 9,627 $10,028
7/31/94 $10,179 $ 9,798 $10,209
8/31/94 $10,189 $ 9,808 $10,244
9/30/94 $10,009 $ 9,635 $10,094
10/31/94 $ 9,760 $ 9,395 $ 9,915
11/30/94 $ 9,518 $ 9,162 $ 9,735
12/31/94 $ 9,831 $ 9,464 $ 9,949
1/31/95 $10,177 $ 9,797 $10,234
2/28/95 $10,550 $10,155 $10,532
3/31/95 $10,632 $10,235 $10,653
4/30/95 $10,641 $10,244 $10,665
5/31/95 $10,942 $10,533 $11,005
6/30/95 $10,764 $10,362 $10,909
7/31/95 $10,827 $10,423 $11,012
8/31/95 $10,933 $10,524 $11,152
9/30/95 $11,069 $10,655 $11,223
10/31/95 $11,281 $10,859 $11,386
11/30/95 $11,557 $11,125 $11,575
12/31/95 $11,718 $11,280 $11,686
1/31/96 $11,782 $11,342 $11,774
2/28/96 $11,618 $11,183 $11,695
3/31/96 $11,445 $11,017 $11,545
4/30/96 $11,411 $10,984 $11,513
5/31/96 $11,389 $10,963 $11,508
6/30/96 $11,508 $11,078 $11,634
7/31/96 $11,651 $11,215 $11,739
8/31/96 $11,606 $11,172 $11,736
9/30/96 $11,793 $11,352 $11,900
</TABLE>
Past performance is not indicative of future results. Investment returns and
principal will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than their original cost. Source: Towers Data Systems,
Bethesda, MD. * Investment operations commenced 4/5/94. +Index information is
available only at month-end; therefore, the line comparison begins at the next
month-end following the commencement of the Fund's investment operations.
FROM THE PORTFOLIO MANAGER:
[PHOTO OF THOMAS J. FETTER]
"This Fund is broadly diversified and maintains a high average investment
rating, with almost 50% invested in triple-A bonds. Moreover, the Fund has
significant positions in essential community needs such as hospitals, electric
utilities, and education.
"I am positioning the Portfolio to perform by including some discount bonds in
my purchases and, as always, by managing for call protection. At times, I can
increase call protection without a significant hit on the yield or net asset
value because institutional buyers like Eaton Vance often get first pick at new
bonds and can sometimes buy them at lower prices. In addition, I increased the
weighting in federal alternative minimum tax (AMT) bonds to 24% from 18% last
year, which is a way to increase yield without increasing risk."
- Thomas J. Fetter
5
<PAGE> 6
EV TRADITIONAL MASSACHUSETTS MUNICIPALS FUND
YOUR INVESTMENT AT WORK
[GRAPHIC OF POWER LINES]
City of Boston, Massachusetts
Harbor Electric Energy Company
The proceeds from these bonds were used to finance the cost of acquiring,
equipping, and installing electric distribution facilities owned and operated by
the Harbor Electric Energy Company, a wholly owned subsidiary of Boston Edison
Company.
Specifically, the new facilities consisted of buildings and equipment that are
part of the waste water treatment plant on Deer Island in Boston Harbor.
Included among the construction projects was a 115-kilovolt submarine cable
between Boston and Deer Island, and a new permanent substation on Deer Island.
[GRAPHIC OF MASSACHUSETTS]
<TABLE>
<CAPTION>
PORTFOLIO OVERVIEW
Based on market value as of September 30, 1996
<S> <C>
Number of issues......................................96
Average quality.......................................A+
Investment grade....................................94.3%
Effective maturity............................11.00 yrs.
Largest sectors:
Housing..........................................14.3
Insured hospitals...............................12.9*
Hospital.........................................11.8
Water & sewer.....................................9.1
Transportation....................................8.3
</TABLE>
* Private insurance does not remove the market risks that are associated with
these investments.
- -------------------------------------------------------------------------------
THE STATE OF THE STATE: Massachusetts
The Massachusetts economy has made a dramatic recovery from the recession of
1990-1991, which was one of the most difficult in recent memory. After three
years of budget deficits, the election of Governor William Weld in 1990 led to
immediate changes on the budgetary front. Since his election in 1990, the
governor has balanced the budget in every year of his administration. As a
result of its more conservative fiscal policies, the state's general obligation
debt has earned several rating increases since 1991.
Though the Massachusetts economic recovery was somewhat slow at first, the
business climate has shown great improvement in recent years. Unemployment
reached 4.0% in August of 1996, its lowest since June of 1989, and job growth
has been increasing at a 1.4% annual rate, with 114,800 new jobs added in the
past two years. The technology and defense-related sectors, which experienced
significant job losses, are beginning to turn around.
The state government has become much friendlier towards the business community
through tax cuts, regulatory reform, investing in infrastructure, and programs
to help small businesses.
- -------------------------------------------------------------------------------
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT IN
EV TRADITIONAL MASSACHUSETTS MUNICIPALS FUND (INCLUDING SALES CHARGE)
AND THE LEHMAN BROTHERS MUNICIPAL BOND INDEX
FROM DECEMBER 31, 1993, THROUGH SEPTEMBER 30, 1996
<TABLE>
<CAPTION>
<S> <C> <C>
Average 1 Life of
Annual Returns Year Fund*
- -----------------------------------------------------
With Max. SC 2.2% 1.5%
- -----------------------------------------------------
Without SC 6.2% 2.8%
- -----------------------------------------------------
</TABLE>
Lehman Brothers Municipal Bond Index: $11,343
EV TRADITIONAL MASSACHUSETTS MUNICIPALS FUND: $10,780
Fund incl. max. sales charge: $10,377
EV Traditional Massachusetts Municipals Fund vs.
Lehman Brothers 7-Year Municipal Bond Index
<TABLE>
<CAPTION>
Date Fund @ NAV Fund w/SC Index
<S> <C> <C> <C>
12/31/93 $10,000 $ 9,626 $10,000
1/31/94 $10,070 $ 9,694 $10,114
2/28/94 $ 9,841 $ 9,473 $ 9,852
3/31/94 $ 9,357 $ 9,007 $ 9,451
4/30/94 $ 9,331 $ 8,983 $ 9,531
5/31/94 $ 9,418 $ 9,066 $ 9,614
6/30/94 $ 9,328 $ 8,980 $ 9,558
7/31/94 $ 9,496 $ 9,141 $ 9,730
8/31/94 $ 9,532 $ 9,175 $ 9,764
9/30/94 $ 9,360 $ 9,010 $ 9,621
10/31/94 $ 9,116 $ 8,776 $ 9,450
11/30/94 $ 8,837 $ 8,506 $ 9,279
12/31/94 $ 9,108 $ 8,768 $ 9,483
1/31/95 $ 9,447 $ 9,094 $ 9,754
2/28/95 $ 9,764 $ 9,398 $10,038
3/31/95 $ 9,844 $ 9,476 $10,153
4/30/95 $ 9,835 $ 9,467 $10,165
5/31/95 $10,077 $ 9,700 $10,490
6/30/95 $ 9,892 $ 9,522 $10,398
7/31/95 $ 9,947 $ 9,575 $10,496
8/31/95 $10,075 $ 9,698 $10,630
9/30/95 $10,151 $ 9,771 $10,697
10/31/95 $10,326 $ 9,940 $10,852
11/30/95 $10,522 $10,129 $11,032
12/31/95 $10,675 $10,276 $11,138
1/31/96 $10,697 $10,297 $11,223
2/28/96 $10,589 $10,193 $11,147
3/31/96 $10,450 $10,059 $11,004
4/30/96 $10,420 $10,031 $10,973
5/31/96 $10,460 $10,069 $10,969
6/30/96 $10,545 $10,150 $11,088
7/31/96 $10,642 $10,244 $11,189
8/31/96 $10,637 $10,239 $11,186
9/30/96 $10,780 $10,377 $11,343
</TABLE>
Past performance is not indicative of future results. Investment returns and
principal will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than their original cost. Source: Towers Data Systems,
Bethesda, MD. * Investment operations commenced 12/7/93. +Index information is
available only at month-end; therefore, the line comparison begins at the next
month-end following the commencement of the Fund's investment operations.
FROM THE PORTFOLIO MANAGER:
[PHOTO OF ROBERT B. MACINTOSH]
"This Fund owns quite a few well-known names such as the Massachusetts Turnpike
Authority, the Massachusetts Water Resources Authority, and some wholesale
electric bonds. These credits may face difficulties in the long term, given the
pressures from increasing debt levels and deregulation, but I feel comfortable
holding onto them for the time being.
"The hospital sector has also faced difficulties due to downsizing and cost
cutting. I am pleased, however, with the Fund's current hospital holdings, such
as Beth Israel Hospital and Daughters of Charity. I am making minor adjustments
to the Portfolio as I see fit, but no major change in strategy is necessary."
- Robert B. MacIntosh
6
<PAGE> 7
EV TRADITIONAL MISSISSIPPI MUNICIPALS FUND
YOUR INVESTMENT AT WORK
[GRAPHIC OF HARDHAT WORKER]
Jackson County, Mississippi
Gautier Utility District
Revenue Refunding Bonds
These bonds are a good example of an investment that receives a constant cash
flow from a reliable source, while providing funds to meet the essential local
needs of a community.
The Gautier Utility District serves a population in excess of 13,000, located in
the southeastern corner of Mississippi. The District provides water, sewerage,
and sewer disposal facilities, as well as fire protection facilities, to the
citizens within its jurisdiction. With expanding growth expected, the District
has a plan to continue to add facilities to meet the growing needs in the years
ahead.
[GRAPHIC OF MISSISSIPPI]
<TABLE>
<CAPTION>
PORTFOLIO OVERVIEW
Based on market value as of September 30, 1996
<S> <C>
Number of issues......................................36
Average quality......................................Aa-
Investment grade....................................98.0%
Effective maturity............................13.88 yrs.
Largest sectors:
Insured hospitals................................18.2%*
Industrial development revenue ..................12.6
Housing..........................................10.4
Lease/certificate of participation................7.9
Utilities.........................................7.5
</TABLE>
*Private insurance does not remove the market risks that are associated with
these investments.
- -------------------------------------------------------------------------------
THE STATE OF THE STATE: Mississippi
Mississippi's economy experienced strong growth between 1985 and 1994, but has
slowed somewhat since then. Nevertheless, its general obligation debt has earned
respectable ratings recently, primarily due to the state government's
conservative financial management, a relatively strong manufacturing base, and a
solid gaming sector.
In the 10 years ended in 1994, Mississippi's employment grew by 23%, versus 16%
for the U.S. as a whole. In 1992, the gaming industry was established and over
50,000 new jobs have been created by that sector since then. The timber and
furniture industries have also performed well in recent years, benefiting from
the growth in the national economy.
The state has initiated several economic development programs to help attract
industry and stem the loss of jobs in defense-related businesses. Also,
Mississippi has taken steps to improve education in an effort to help its work
force become more competitive and earn higher wages, as its income levels are
among the lowest in the nation. For example, in 1996, the state committed $36.5
million for an educational enhancement fund.
The state government is fiscally conservative, and has had budgetary surpluses
every year since 1990.
- -------------------------------------------------------------------------------
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT IN
EV TRADITIONAL MISSISSIPPI MUNICIPALS FUND (INCLUDING SALES CHARGE)
AND THE LEHMAN BROTHERS MUNICIPAL BOND INDEX
FROM DECEMBER 31, 1993, THROUGH SEPTEMBER 30, 1996
<TABLE>
<CAPTION>
Average 1 Life of
Annual Returns Year Fund*
- ----------------------------------------------------
<S> <C> <C>
With Max. SC 2.7% 1.5%
- ----------------------------------------------------
Without SC 6.6% 2.9%
- ----------------------------------------------------
</TABLE>
Lehman Brothers Municipal Bond Index: $11,343
EV TRADITIONAL MISSISSIPPI MUNICIPALS FUND: $10,805
Fund Incl. Max. Sales Charge: $10,401
EV Traditional Mississippi Municipals Fund vs.
Lehman Brothers 7-Year Municipal Bond Index
<TABLE>
<CAPTION>
Date Fund @ NAV Fund w/SC Index
<S> <C> <C> <C>
12/31/93 $10,000 $ 9,626 $10,000
1/31/94 $10,109 $ 9,731 $10,114
2/28/94 $ 9,798 $ 9,432 $ 9,852
3/31/94 $ 9,180 $ 8,837 $ 9,451
4/30/94 $ 9,253 $ 8,907 $ 9,531
5/31/94 $ 9,336 $ 8,987 $ 9,614
6/30/94 $ 9,254 $ 8,908 $ 9,558
7/31/94 $ 9,428 $ 9,076 $ 9,730
8/31/94 $ 9,430 $ 9,078 $ 9,764
9/30/94 $ 9,256 $ 8,910 $ 9,621
10/31/94 $ 9,030 $ 8,693 $ 9,450
11/30/94 $ 8,790 $ 8,462 $ 9,279
12/31/94 $ 9,016 $ 8,679 $ 9,483
1/31/95 $ 9,361 $ 9,011 $ 9,754
2/28/95 $ 9,716 $ 9,352 $10,038
3/31/95 $ 9,793 $ 9,427 $10,153
4/30/95 $ 9,770 $ 9,404 $10,165
5/31/95 $10,061 $ 9,685 $10,490
6/30/95 $ 9,907 $ 9,536 $10,398
7/31/95 $ 9,969 $ 9,596 $10,496
8/31/95 $10,071 $ 9,694 $10,630
9/30/95 $10,132 $ 9,753 $10,697
10/31/95 $10,314 $ 9,928 $10,852
11/30/95 $10,539 $10,145 $11,032
12/31/95 $10,665 $10,266 $11,138
1/31/96 $10,716 $10,316 $11,223
2/28/96 $10,606 $10,209 $11,147
3/31/96 $10,431 $10,041 $11,004
4/30/96 $10,409 $10,020 $10,973
5/31/96 $10,435 $10,044 $10,969
6/30/96 $10,548 $10,154 $11,088
7/31/96 $10,642 $10,244 $11,189
8/31/96 $10,644 $10,246 $11,186
9/30/96 $10,805 $10,401 $11,343
</TABLE>
Past performance is not indicative of future results. Investment returns and
principal will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than their original cost. Source: Towers Data Systems,
Bethesda, MD. * Investment operations commenced 12/7/93. +Index information is
available only at month-end; therefore, the line comparison begins at the next
month-end following the commencement of the Fund's investment operations.
FROM THE PORTFOLIO MANAGER:
[PHOTO OF CYNTHIA J. CLEMSON]
"Although the Mississippi bond market has experienced little in the way of new
issuance recently, we have been fortunate to find some good value in housing
bonds. These have respectable income streams and relatively stable prepayment
rates. In addition, our relationships with several local brokers in Mississippi
has provided us with access to attractive new deals which are not widely
disseminated in the general market.
"The Fund has also seen price appreciation in its Mississippi general obligation
holdings, whose ratings were recently upgraded. To help the Fund's total return,
I continually focus on Portfolio structure, which includes increasing call
protection and choosing the appropriate coupon and maturity characteristics."
- Cynthia J. Clemson
7
<PAGE> 8
EV TRADITIONAL NEW YORK MUNICIPALS FUND
[GRAPHIC OF POWER LINES]
YOUR INVESTMENT AT WORK
New York State Energy Research
and Development Authority -
Brooklyn Union Gas Company
Brooklyn Union Gas Company - one of the premier utilities in New York
distributes gas to retail customers in the metropolitan New York City area.
Proceeds from this issue have been used for general plant improvements and
expansions.
These bonds were issued in late January, 1996, at attractive price levels and
provided a good opportunity to swap out of other New York bonds that had weaker
trading values without sacrificing yield. These bonds are insured by MBIA,
resulting in a triple-A Standard & Poor's rating.
[GRAPHIC OF NEW YORK]
<TABLE>
<CAPTION>
PORTFOLIO OVERVIEW
Based on market value as of September 30, 1996
<S> <C>
Number of issues.....................................155
Average quality.......................................A+
Investment grade....................................98.3%
Effective maturity............................13.35 yrs.
Largest sectors:
Health care......................................16.8%
Education .......................................15.1
Special tax revenue..............................11.8
Lease/certificate of participation...............11.2
Escrowed..........................................9.6
</TABLE>
- ------------------------------------------------------------------------------
THE STATE OF THE STATE: New York
New York's economy has continued its relatively slow rate of growth in 1996,
with mediocre economic results for the state offset by a Wall Street-led
recovery in New York City. The securities industry, concentrated primarily in
New York City, has emerged as a key part of the state's overall economy,
accounting for 2.5% of the state's private sector employment and over 5% for
that of New York City. Average wages for the securities industry, at $127,800 in
1995, are among the highest in the state. By comparison, average wages excluding
this industry were $32,300 in 1995. Overall, employment in the state is up 1%
over the previous year, and this rate of growth is not expected to change
significantly through 1997. The unemployment rate, at 6.5% in July of this year,
was a full percentage point higher than that of the nation. New York is still
one of the wealthiest states in the country, with a personal income that is 118%
of the nation, but the rate of growth in personal income has slowed considerably
since the 1990-1991 recession.
New York's budget has been balanced due to higher than expected revenues from
the securities industry, but problems remain. Though the governor's three-year
income tax cut was implemented for the 1996-97 budget, spending cuts have been
slow to materialize. And with the enactment of the new federal welfare bill, New
York's costly social programs could become especially burdensome if not brought
under stricter control.
- ------------------------------------------------------------------------------
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT IN
EV TRADITIONAL NEW YORK MUNICIPALS FUND (INCLUDING SALES CHARGE)
AND THE LEHMAN BROTHERS MUNICIPAL BOND INDEX
FROM APRIL 30, 1994, THROUGH SEPTEMBER 30, 1996
Lehman Brothers Municipal Bond Index: $11,900
EV TRADITIONAL NEW YORK MUNICIPALS FUND: $11,871
Fund Incl. Max. Sales Charge: $11,424
EV Traditional New York Municipals Fund vs.
Lehman Brothers 7-Year Municipal Bond Index
<TABLE>
<CAPTION>
Date Fund @ NAV Fund w/SC Index
<S> <C> <C> <C>
4/30/94 $10,000 $ 9,624 $10,000
5/31/94 $10,148 $ 9,766 $10,087
6/30/94 $10,056 $ 9,677 $10,028
7/31/94 $10,240 $ 9,854 $10,209
8/31/94 $10,302 $ 9,914 $10,244
9/30/94 $10,086 $ 9,706 $10,094
10/31/94 $ 9,870 $ 9,499 $ 9,915
11/30/94 $ 9,527 $ 9,169 $ 9,735
12/31/94 $ 9,852 $ 9,481 $ 9,949
1/31/95 $10,198 $ 9,815 $10,234
2/28/95 $10,552 $10,155 $10,532
3/31/95 $10,670 $10,268 $10,653
4/30/95 $10,683 $10,281 $10,665
5/31/95 $10,994 $10,580 $11,005
6/30/95 $10,832 $10,425 $10,909
7/31/95 $10,909 $10,498 $11,012
8/31/95 $11,062 $10,646 $11,152
9/30/95 $11,127 $10,708 $11,223
10/31/95 $11,336 $10,909 $11,386
11/30/95 $11,578 $11,142 $11,575
12/31/95 $11,700 $11,260 $11,686
1/31/96 $11,757 $11,314 $11,774
2/28/96 $11,631 $11,193 $11,695
3/31/96 $11,475 $11,043 $11,545
4/30/96 $11,463 $11,031 $11,513
5/31/96 $11,475 $11,043 $11,508
6/30/96 $11,598 $11,161 $11,634
7/31/96 $11,701 $11,260 $11,739
8/31/96 $11,677 $11,237 $11,736
9/30/96 $11,871 $11,424 $11,900
</TABLE>
<TABLE>
<CAPTION>
Average 1 Life of
Annual Returns Year Fund*
- ----------------------------------------------------
<S> <C> <C>
With Max. SC 2.7% 5.4%
- ----------------------------------------------------
Without SC 6.7% 7.1%
- ----------------------------------------------------
</TABLE>
Past performance is not indicative of future results. Investment returns and
principal will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than their original cost. Source: Towers Data Systems,
Bethesda, MD. * Investment operations commenced 4/15/94. +Index information is
available only at month-end; therefore, the line comparison begins at the next
month-end following the commencement of the Fund's investment operations.
FROM THE PORTFOLIO MANAGER:
[PHOTO OF NICOLE ANDERES]
"As the market sold off in the spring of 1996, the Portfolio fared better
because of defensive coupon swaps that I had entered in late 1995 when prices
were high. I gradually reversed these swaps back into low coupon, `bullish'
bonds during this sell-off.
"Because of the exceptionally strong year on Wall Street, it became clear that
New York would end its 1995-1996 fiscal year with a moderate surplus. Based on
this news, I began to rebuild the Portfolio's exposure to higher-yielding state
appropriation debt. Since June, the bond markets have been caught in a volatile
trading range, and I have kept the Portfolio in a neutral interest rate posture
relative to its peer group."
- Nicole Anderes
8
<PAGE> 9
EV TRADITIONAL OHIO MUNICIPALS FUND
YOUR INVESTMENT AT WORK
[GRAPHIC OF OFFICE BUILDINGS]
State of Ohio Economic
Development - Ohio Enterprise
Bond Fund
This bond issue is funding a major industrial development project located in the
Nova Technology Park in the City of Massillon, Ohio. The project is a brand new,
144,000 square foot facility that will be used for the manufacturing of air-dry
body filler for automobile repairs, including proprietary and custom polyester
types of auto body repair materials.
The company leasing this facility is U.S. Chemical and Plastic, a subsidiary of
Alco Industries, Inc. Alco Industries, located in Valley Forge, Pennsylvania, is
a diversified manufacturing company with over $175 million in annual sales.
[GRAPHIC OF STATE OF OHIO]
<TABLE>
<CAPTION>
PORTFOLIO OVERVIEW
Based on market value as of September 30, 1996
<S> <C>
Number of issues.................................123
Average quality...................................A+
Investment grade................................68.3%
Effective maturity........................11.92 yrs.
Largest sectors:
Hospitals....................................22.6%
Insured hospitals...........................12.5*
Housing......................................11.9
Industrial development/pollution control.....11.8
General obligation............................7.6
</TABLE>
*Private insurance does not remove the market risks that are associated with
these investments.
- -------------------------------------------------------------------------------
THE STATE OF THE STATE: Ohio
Ohio has benefited in the past few years from an increasing diversification of
its economy. The state has relied historically on manufacturing, but this sector
has declined in importance, following a national trend. Still, manufacturing
remains a larger percentage of the economy in Ohio than in the U.S. According to
the Federal Reserve Bank of Cleveland (FRBC), 17% of Ohio's workers were
categorized as operators, fabricators, and laborers, versus 14% nationally. This
could explain a projected growth rate that is slower in Ohio than it is in the
U.S. The FRBC estimates that through the year 2005, the U.S. economy will grow
at an average annual rate of 1.5%, compared to 1.1% in Ohio. Nevertheless, the
diversifying economy - led by the service and trade sectors - has brought much
stability to the state, and the positive effects of economic diversification
should continue.
Ohio's government has done an admirable job of managing the state's finances,
with significant cuts in spending leading to budgetary surpluses over the past
few years. Moreover, the budget is balanced through 1997. This conservative
fiscal management has earned the state high bond ratings from both Moody's and
Standard & Poor's.
- -------------------------------------------------------------------------------
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT IN EV TRADITIONAL OHIO
MUNICIPALS FUND (INCLUDING SALES CHARGE) AND THE LEHMAN BROTHERS MUNICIPAL BOND
INDEX
FROM DECEMBER 31, 1993, THROUGH SEPTEMBER 30, 1996
<TABLE>
<CAPTION>
Average
Annual Returns 1 Year Life of Fund*
- ---------------------------------------------------
<S> <C> <C>
With Max. SC 2.2% 1.6%
- ---------------------------------------------------
Without SC 6.1% 2.9%
- ---------------------------------------------------
</TABLE>
Lehman Brothers Municipal Bond Index: $11,343
EV TRADITIONAL OHIO MUNICIPALS FUND: $10,817
Fund incl. max. sales charge: $10,412
EV Traditional Ohio Municipals Fund vs.
Lehman Brothers 7-Year Municipal Bond Index
<TABLE>
<CAPTION>
Date Fund @ NAV Fund w/SC Index
<S> <C> <C> <C>
12/31/93 $10,000 $ 9,626 $10,000
1/31/94 $10,139 $ 9,760 $10,114
2/28/94 $ 9,857 $ 9,489 $ 9,852
3/31/94 $ 9,291 $ 8,944 $ 9,451
4/30/94 $ 9,283 $ 8,936 $ 9,531
5/31/94 $ 9,387 $ 9,036 $ 9,614
6/30/94 $ 9,254 $ 8,908 $ 9,558
7/31/94 $ 9,470 $ 9,116 $ 9,730
8/31/94 $ 9,493 $ 9,138 $ 9,764
9/30/94 $ 9,309 $ 8,961 $ 9,621
10/31/94 $ 9,074 $ 8,734 $ 9,450
11/30/94 $ 8,803 $ 8,474 $ 9,279
12/31/94 $ 9,060 $ 8,721 $ 9,483
1/31/95 $ 9,384 $ 9,034 $ 9,754
2/28/95 $ 9,728 $ 9,365 $10,038
3/31/95 $ 9,827 $ 9,460 $10,153
4/30/95 $ 9,815 $ 9,448 $10,165
5/31/95 $10,118 $ 9,740 $10,490
6/30/95 $ 9,932 $ 9,560 $10,398
7/31/95 $ 9,994 $ 9,620 $10,496
8/31/95 $10,140 $ 9,761 $10,630
9/30/95 $10,180 $ 9,799 $10,697
10/31/95 $10,362 $ 9,974 $10,852
11/30/95 $10,565 $10,170 $11,032
12/31/95 $10,703 $10,303 $11,138
1/31/96 $10,755 $10,353 $11,223
2/28/96 $10,645 $10,247 $11,147
3/31/96 $10,481 $10,089 $11,004
4/30/96 $10,449 $10,059 $10,973
5/31/96 $10,464 $10,072 $10,969
6/30/96 $10,555 $10,161 $11,088
7/31/96 $10,672 $10,273 $11,189
8/31/96 $10,663 $10,265 $11,186
9/30/96 $10,836 $10,431 $11,343
</TABLE>
Past performance is not indicative of future results. Investment returns and
principal will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than their original cost. Source: Towers Data Systems,
Bethesda, MD. * Investment operations commenced 12/7/93. +Index information is
available only at month-end; therefore, the line comparison begins at the next
month-end following the commencement of the Fund's investment operations.
FROM THE PORTFOLIO MANAGER:
[PHOTO OF THOMAS J. FETTER]
"As in other industrial states, the municipal bond market has helped stimulate
Ohio's economy. Projects such as the Nova Technology Park, as well as other
essential needs such as transportation, education, health care, and electric
power, are examples of how municipal bonds can help serve local communities.
"Our research staff is adept at finding good credit quality in non-rated
holdings. This gives us higher-yielding securities without necessarily adding
significant risk. We are also enhancing the performance characteristics of the
Fund by investing in premium and discount bonds and staying away from current
coupon bonds. This helps to maintain good upside potential while limiting
downside volatility."
- Thomas J. Fetter
9
<PAGE> 10
EV TRADITIONAL WEST VIRGINIA MUNICIPALS FUND
YOUR INVESTMENT AT WORK
[GRAPHIC OF MAN OPENING WATER VALVE]
Harrison County, WV Solid
Waste Disposal Revenue Bonds
These bonds are being used to finance the construction of solid waste disposal
facilities located at the Harrison Power Station in Harrison County, West
Virginia. These facilities, which will include a flue gas desulfurization
process, will be very helpful in dealing with the solid waste disposal needs of
the Harrison County area.
The costs of the new facilities will be allocated among the three major owners
of the Harrison Power Station: Monongahela Power Company, The Potomac Edison
Company, and the West Penn Power Company.
[GRAPHIC OF W.VIRGINIA]
<TABLE>
<CAPTION>
PORTFOLIO OVERVIEW
Based on market value as of September 30, 1996
<S> <C>
Number of issues................................................42
Average quality................................................AA-
Investment grade..............................................95.3%
Effective maturity......................................15.05 yrs.
Largest sectors:
Industrial development/pollution control...................20.2%
Insured water & sewer.....................................15.9*
Insured hospitals.........................................12.2*
Electric utilities.........................................11.2
Hospital revenue...........................................10.6
</TABLE>
*Private insurance does not remove the market risks that are associated with
these investments.
- -------------------------------------------------------------------------------
THE STATE OF THE STATE: W. Virginia
West Virginians had reason to cheer this summer, as their state unemployment
rate dipped below the 7.0% mark for the first time since 1979, reaching an
unrevised 6.5%. Indeed, the state's economy has turned around remarkably since
1990, having been in an economic slump throughout the 1980s. During that decade,
the state lost 150,000 residents in net out-migration, and its personal
disposable income was 24.4% below the national average. That income gap has
narrowed to 18.6%, and the population has grown by over 34,000 on a net basis.
During the 12 months ended in July, 1996, total non-farm employment increased by
14,100 jobs. The bulk of this increase came from the expanding service and trade
sectors, which added 6,900 and 5,200 jobs, respectively, and constituted more
than 85% of job growth for this period. Job losses in the mining and
manufacturing sectors were offset by gains in construction, for a net increase
of 600 jobs in the goods-producing category.
The outlook for West Virginia's economy is positive, with moderate growth
expected for the next several years. The state government has improved financial
reporting practices, balanced its budget and built up financial reserves, and
significantly increased funding for education. This attractive climate should
continue to attract residents and businesses to West Virginia in the future.
- -------------------------------------------------------------------------------
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT IN EV TRADITIONAL WEST
VIRGINIA MUNICIPALS FUND (INCLUDING SALES CHARGE) AND THE LEHMAN BROTHERS
MUNICIPAL BOND INDEX
FROM DECEMBER 31, 1993, THROUGH SEPTEMBER 30, 1996
<TABLE>
<CAPTION>
Average Life of
Annual Returns 1 Year Fund*
- ---------------------------------------------------
<S> <C> <C>
With Max. SC 2.5% 1.7%
- ---------------------------------------------------
Without SC 6.5% 3.1%
- ---------------------------------------------------
</TABLE>
Lehman Brothers Municipal Bond Index: $10,836
EV TRADITIONAL WEST VIRGINIA MUNICIPALS FUND: $11,343
Fund incl. max. sales charge: $10,431
EV Traditional West Virginia Municipals Fund vs.
Lehman Brothers 7-Year Municipal Bond Index
<TABLE>
<CAPTION>
Date Fund @ NAV Fund w/SC Index
<S> <C> <C> <C>
12/31/93 $10,000 $ 9,626 $10,000
1/31/94 $10,139 $ 9,760 $10,114
2/28/94 $ 9,857 $ 9,489 $ 9,852
3/31/94 $ 9,291 $ 8,944 $ 9,451
4/30/94 $ 9,283 $ 8,936 $ 9,531
5/31/94 $ 9,387 $ 9,036 $ 9,614
6/30/94 $ 9,254 $ 8,908 $ 9,558
7/31/94 $ 9,470 $ 9,116 $ 9,730
8/31/94 $ 9,493 $ 9,138 $ 9,764
9/30/94 $ 9,309 $ 8,961 $ 9,621
10/31/94 $ 9,074 $ 8,734 $ 9,450
11/30/94 $ 8,803 $ 8,474 $ 9,279
12/31/94 $ 9,060 $ 8,721 $ 9,483
1/31/95 $ 9,384 $ 9,034 $ 9,754
2/28/95 $ 9,728 $ 9,365 $10,038
3/31/95 $ 9,827 $ 9,460 $10,153
4/30/95 $ 9,815 $ 9,448 $10,165
5/31/95 $10,118 $ 9,740 $10,490
6/30/95 $ 9,932 $ 9,560 $10,398
7/31/95 $ 9,994 $ 9,620 $10,496
8/31/95 $10,140 $ 9,761 $10,630
9/30/95 $10,180 $ 9,799 $10,697
10/31/95 $10,362 $ 9,974 $10,852
11/30/95 $10,565 $10,170 $11,032
12/31/95 $10,703 $10,303 $11,138
1/31/96 $10,755 $10,353 $11,223
2/28/96 $10,645 $10,247 $11,147
3/31/96 $10,481 $10,089 $11,004
4/30/96 $10,449 $10,059 $10,973
5/31/96 $10,464 $10,072 $10,969
6/30/96 $10,555 $10,161 $11,088
7/31/96 $10,672 $10,273 $11,189
8/31/96 $10,663 $10,265 $11,186
9/30/96 $10,836 $10,431 $11,343
</TABLE>
Past performance is not indicative of future results. Investment returns and
principal will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than their original cost. Source: Towers Data Systems,
Bethesda, MD. * Investment operations commenced 12/13/93. +Index information is
available only at month-end; therefore, the line comparison begins at the next
month-end following the commencement of the Fund's investment operations.
FROM THE PORTFOLIO MANAGER:
[PHOTO OF TIMOTHY T. BROWSE]
"The improving economy in West Virginia has helped bring about new municipal
bond issuance, which has allowed me to diversify the Portfolio. This benefits
share-holders in several ways: it lightens positions in heavily-concentrated
industry sectors; it increases call protection; and it builds a more solid
portfolio structure.
"Although the flow of new money is not as strong as it was a few years ago, this
slower market enables me to pick and choose new positions more carefully. I am
also enhancing the performance characteristics of the Fund by investing in
premium and discount bonds and staying away from current coupon bonds. This
helps to maintain good upside potential while limiting downside volatility."
- Timothy T. Browse
10
<PAGE> 11
EV Traditional Municipals Funds
Financial Statements
STATEMENTS OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
September 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TRADITIONAL TRADITIONAL TRADITIONAL TRADITIONAL
CALIFORNIA FLORIDA MASSACHUSETTS MISSISSIPPI
FUND FUND FUND FUND
----------- ----------- ------------- -----------
<S> <C> <C> <C> <C>
ASSETS:
Investment in Portfolio --
Identified cost $5,916,575 $4,263,773 $ 5,954,168 $1,091,916
Unrealized appreciation 231,351 119,460 79,036 101,340
---------- ---------- ---------- ----------
Total investment in Portfolio, at value (Note
1A) $6,147,926 $4,383,233 $ 6,033,204 $1,193,256
Receivable from the Administrator (Note 5) 25,389 20,337 22,401 15,479
Deferred organization expenses (Note 1D) 5,094 465 4,350 4,972
---------- ---------- ---------- ----------
Total assets $6,178,409 $4,404,035 $ 6,059,955 $1,213,707
---------- ---------- ---------- ----------
LIABILITIES:
Dividends payable $ 7,253 $ 13,095 $ 7,523 $ 3,070
Accrued expenses 2,774 2,584 7,044 2,460
---------- ---------- ---------- ----------
Total liabilities $ 10,027 $ 15,679 $ 14,567 $ 5,530
---------- ---------- ---------- ----------
NET ASSETS $6,168,382 $4,388,356 $ 6,045,388 $1,208,177
========== ========== ========== ==========
SOURCES OF NET ASSETS:
Paid-in capital $5,953,122 $4,278,695 $ 6,288,892 $1,363,801
Accumulated net realized loss from Portfolio
(computed on the basis of identified cost) (17,305) (7,293) (315,719) (262,314)
Accumulated undistributed (distributions in excess
of) net investment income 1,214 (2,506) (6,821) 5,350
Unrealized appreciation from Portfolio (computed on
the basis of identified cost) 231,351 119,460 79,036 101,340
---------- ---------- ---------- ----------
Total $6,168,382 $4,388,356 $ 6,045,388 $1,208,177
========== ========== ========== ==========
SHARES OF BENEFICIAL INTEREST OUTSTANDING 594,304 416,936 650,326 128,239
========== ========== ========== ==========
NET ASSET VALUE AND REDEMPTION PRICE PER SHARE
(net assets / shares of beneficial interest
outstanding) $10.38 $10.53 $9.30 $9.42
====== ====== ===== =====
COMPUTATION OF OFFERING PRICE PER SHARE
(100/96.25 of net asset value per share) $10.78 $10.94 $9.66 $9.79
====== ====== ===== =====
</TABLE>
On sales of $50,000 or more, the offering price is reduced.
See notes to financial statements
11
<PAGE> 12
FINANCIAL STATEMENTS (continued)
STATEMENTS OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
September 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TRADITIONAL TRADITIONAL TRADITIONAL
NEW YORK OHIO WEST VIRGINIA
FUND FUND FUND
----------- ----------- -------------
<S> <C> <C> <C>
ASSETS:
Investment in Portfolio --
Identified cost $6,812,316 $1,945,020 $ 1,565,287
Unrealized appreciation (depreciation) 153,692 (7,614 ) 2,877
---------- ---------- ----------
Total investment in Portfolio, at value (Note 1A) $6,966,008 $1,937,406 $ 1,568,164
Receivable for Fund shares sold 44,221 4,810 1,010
Receivable from the Administrator (Note 5) 25,729 19,500 15,088
Deferred organization expenses (Note 1D) 8,397 5,052 5,057
---------- ---------- ----------
Total assets $7,044,355 $1,966,768 $ 1,589,319
---------- ---------- ----------
LIABILITIES:
Dividends payable $ 15,861 $ 4,387 $ 1,614
Payable to affiliate --
Trustees' fees (Note 5) 42 -- --
Accrued expenses 3,433 3,137 2,844
---------- ---------- ----------
Total liabilities $ 19,336 $ 7,524 $ 4,458
---------- ---------- ----------
NET ASSETS $7,025,019 $1,959,244 $ 1,584,861
========== ========== ==========
SOURCES OF NET ASSETS:
Paid-in capital $6,880,275 $2,069,997 $ 1,667,068
Accumulated net realized gain (loss) from Portfolio (computed on
the basis of identified cost) 5,105 (102,156) (83,470)
Accumulated distributions in excess of net investment income (14,053) (983) (1,614)
Unrealized appreciation (depreciation) from Portfolio (computed
on the basis of identified cost) 153,692 (7,614) 2,877
---------- ---------- ----------
Total $7,025,019 $1,959,244 $ 1,584,861
========== ========== ==========
SHARES OF BENEFICIAL INTEREST OUTSTANDING 687,100 208,794 167,760
========== ========== ==========
NET ASSET VALUE AND REDEMPTION PRICE PER SHARE
(net assets / shares of beneficial interest outstanding) $10.22 $9.38 $9.45
====== ===== =====
COMPUTATION OF OFFERING PRICE PER SHARE
(100/96.25 of net asset value per share) $10.62 $9.75 $9.82
====== ===== =====
</TABLE>
On sales of $50,000 or more, the offering price is reduced.
See notes to financial statements
12
<PAGE> 13
STATEMENTS OF OPERATIONS
- --------------------------------------------------------------------------------
For the Year Ended September 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TRADITIONAL TRADITIONAL TRADITIONAL TRADITIONAL
CALIFORNIA FLORIDA MASSACHUSETTS MISSISSIPPI
FUND FUND FUND FUND
----------- ----------- ------------- -----------
<S> <C> <C> <C> <C>
INVESTMENT INCOME (NOTE 1B):
Interest income allocated from Portfolio $ 230,733 $ 239,000 $ 217,121 $ 97,591
Expenses allocated from Portfolio (19,536) (18,945) (18,237) (4,309)
---------- --------- - --------- - --------- -
Net investment income from Portfolio $ 211,197 $ 220,055 $ 198,884 $ 93,282
---------- --------- - --------- - --------- -
Expenses --
Distribution costs (Notes 6 & 7) $ 3,551 $ 2,650 $ 13,884 $ 9,185
Custodian fee (Note 1G) 3,000 2,849 3,000 2,976
Transfer and dividend disbursing agent fees 2,524 2,261 2,783 1,321
Printing and postage 10,548 7,890 6,947 6,183
Legal and accounting services 5,213 4,514 5,265 5,652
Registration costs -- -- 2,003 --
Amortization of organization expenses (Note
1D) 1,929 4,952 2,025 2,302
Miscellaneous 2,092 1,003 1,604 1,484
---------- --------- - --------- - --------- -
Total expenses $ 28,857 $ 26,119 $ 37,511 $ 29,103
---------- --------- - --------- - --------- -
Deduct --
Allocation of expenses to the Administrator
(Note 5) $ 25,389 $ 20,337 $ 22,401 $ 15,479
Reduction of custodian fee (Note 1G) -- 1,976 -- --
---------- --------- - --------- - --------- -
Total $ 25,389 $ 22,313 $ 22,401 $ 15,479
---------- --------- - --------- - --------- -
Net expenses $ 3,468 $ 3,806 $ 15,110 $ 13,624
---------- --------- - --------- - --------- -
Net investment income $ 207,729 $ 216,249 $ 183,774 $ 79,658
---------- --------- - --------- - --------- -
REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) from Portfolio --
Investment transactions (identified cost
basis) $ 47,004 $ 44,195 $ 9,526 $ 27,072
Financial futures contracts (10,007) (14,508) (6,683) (2,951)
---------- --------- - --------- - --------- -
Net realized gain $ 36,997 $ 29,687 $ 2,843 $ 24,121
Change in unrealized appreciation 68,798 3,027 31,359 27,050
---------- --------- - --------- - --------- -
Net realized and unrealized gain $ 105,795 $ 32,714 $ 34,202 $ 51,171
---------- --------- - --------- - --------- -
Net increase in net assets from
operations $ 313,524 $ 248,963 $ 217,976 $ 130,829
========== ========== ========== ==========
</TABLE>
See notes to financial statements
13
<PAGE> 14
FINANCIAL STATEMENTS (continued)
STATEMENTS OF OPERATIONS
- --------------------------------------------------------------------------------
For the Year Ended September 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TRADITIONAL TRADITIONAL TRADITIONAL
NEW YORK OHIO WEST VIRGINIA
FUND FUND FUND
----------- ----------- -------------
<S> <C> <C> <C>
INVESTMENT INCOME (NOTE 1B):
Interest income allocated from Portfolio $ 353,820 $ 129,625 $ 65,221
Expenses allocated from Portfolio (28,078) (11,559) (4,156)
-------- -------- -------
Net investment income from Portfolio $ 325,742 $ 118,066 $ 61,065
-------- -------- -------
Expenses --
Compensation of Trustees not members of the
Administrator's organization (Note 5) $ 253 $ -- $ --
Distribution costs (Notes 6 & 7) 4,127 9,930 4,911
Custodian fee (Note 1G) 2,902 3,001 2,983
Transfer and dividend disbursing agent fees 3,675 1,956 1,143
Printing and postage 9,096 6,682 5,780
Legal and accounting services 4,845 5,082 4,837
Amortization of organization expenses (Note 1D) 3,027 2,098 2,321
Miscellaneous 1,931 2,082 1,050
-------- -------- -------
Total expenses $ 29,856 $ 30,831 $ 23,025
-------- -------- -------
Deduct --
Allocation of expenses to the Administrator (Note 5) $ 25,729 $ 19,500 $ 15,088
Reduction of custodian fee (Note 1G) -- 667 --
-------- -------- -------
Total $ 25,729 $ 20,167 $ 15,088
-------- -------- -------
Net expenses $ 4,127 $ 10,664 $ 7,937
-------- -------- -------
Net investment income $ 321,615 $ 107,402 $ 53,128
-------- -------- -------
REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) from Portfolio --
Investment transactions (identified cost basis) $ 39,205 $ 8,984 $ (15,438)
Financial futures contracts (9,652) (4,141) (128)
-------- -------- -------
Net realized gain (loss) $ 29,553 $ 4,843 $ (15,566)
Change in unrealized appreciation 8,414 12,947 39,368
-------- -------- -------
Net realized and unrealized gain $ 37,967 $ 17,790 $ 23,802
-------- -------- -------
Net increase in net assets from operations $ 359,582 $ 125,192 $ 76,930
======== ======== =======
</TABLE>
See notes to financial statements
14
<PAGE> 15
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
For the Year Ended September 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TRADITIONAL TRADITIONAL TRADITIONAL TRADITIONAL
CALIFORNIA FLORIDA MASSACHUSETTS MISSISSIPPI
FUND FUND FUND FUND
----------- ----------- ------------- -----------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations --
Net investment income $ 207,729 $ 216,249 $ 183,774 $ 79,658
Net realized gain 36,997 29,687 2,843 24,121
Change in unrealized appreciation 68,798 3,027 31,359 27,050
----------- ----------- ------------- -----------
Net increase in net assets from operations $ 313,524 $ 248,963 $ 217,976 $ 130,829
----------- ----------- ------------- -----------
Distributions to shareholders (Note 3) --
From net investment income $ (208,459) $ (216,249) $ (184,196) $ (80,687)
In excess of net investment income -- (830) (6,821) --
----------- ----------- ------------- -----------
Total distributions to shareholders $ (208,459) $ (217,079) $ (191,017) $ (80,687)
----------- ----------- ------------- -----------
Transactions in shares of beneficial interest (Note
4) --
Proceeds from sales of shares $4,245,553 $1,826,853 $ 4,671,489 $ 71,284
Net asset value of shares issued to shareholders
in payment of distributions declared 102,478 69,823 131,950 59,858
Cost of shares redeemed (2,377,166) (1,087,885) (1,548,936) (1,302,869)
----------- ----------- ------------- -----------
Increase (decrease) in net assets from Fund
share transactions $1,970,865 $ 808,791 $ 3,254,503 $(1,171,727)
----------- ----------- ------------- -----------
Net increase (decrease) in net assets $2,075,930 $ 840,675 $ 3,281,462 $(1,121,585)
NET ASSETS:
At beginning of year 4,092,452 3,547,681 2,763,926 2,329,762
---------- ---------- ------------- ----------
At end of year $6,168,382 $4,388,356 $ 6,045,388 $1,208,177
========== ========== =========== ==========
ACCUMULATED UNDISTRIBUTED (DISTRIBUTIONS IN EXCESS
OF ) NET INVESTMENT INCOME INCLUDED IN NET ASSETS AT
END OF YEAR $ 1,214 $ (2,506) $ (6,821) $ 5,350
========== ========== =========== ==========
</TABLE>
See notes to financial statements
15
<PAGE> 16
FINANCIAL STATEMENTS (continued)
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
For the Year Ended September 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TRADITIONAL TRADITIONAL TRADITIONAL
NEW YORK OHIO WEST VIRGINIA
FUND FUND FUND
----------- ----------- -------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations --
Net investment income $ 321,615 $ 107,402 $ 53,128
Net realized gain (loss) 29,553 4,843 (15,566)
Change in unrealized appreciation 8,414 12,947 39,368
---------- -------- ----------
Net increase in net assets from operations $ 359,582 $ 125,192 $ 76,930
---------- -------- ----------
Distributions to shareholders (Note 3) --
From net investment income $ (321,615 ) $ (107,402 ) $ (56,133)
In excess of net investment income (13,657 ) (959 ) (2,011)
---------- -------- ----------
Total distributions to shareholders $ (335,272 ) $ (108,361 ) $ (58,144)
---------- -------- ----------
Transactions in shares of beneficial interest (Note 4) --
Proceeds from sales of shares $3,396,331 $ 320,479 $ 902,359
Net asset value of shares issued to shareholders in payment
of distributions declared 164,593 75,359 42,725
Cost of shares redeemed (987,352 ) (621,339 ) (411,297)
---------- -------- ----------
Increase (decrease) in net assets from Fund share
transactions $2,573,572 $ (225,501 ) $ 533,787
---------- -------- ----------
Net increase (decrease) in net assets $2,597,882 $ (208,670 ) $ 552,573
NET ASSETS:
At beginning of year 4,427,137 2,167,914 1,032,288
---------- -------- ----------
At end of year $7,025,019 $1,959,244 $ 1,584,861
========== ======== ==========
ACCUMULATED DISTRIBUTIONS IN EXCESS OF NET INVESTMENT
INCOME INCLUDED IN NET ASSETS AT END OF YEAR $ (14,053 ) $ (983 ) $ (1,614)
========== ======== ==========
</TABLE>
See notes to financial statements
16
<PAGE> 17
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
For the Year Ended September 30, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TRADITIONAL TRADITIONAL TRADITIONAL TRADITIONAL
CALIFORNIA FLORIDA MASSACHUSETTS MISSISSIPPI
FUND FUND FUND FUND
----------- ----------- ------------- -----------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations --
Net investment income $ 225,745 $ 119,802 $ 143,481 $ 117,954
Net realized loss (51,790) (35,990) (218,094) (218,922)
Change in unrealized appreciation 176,972 142,361 242,489 304,544
----------- -------- ---------- ----------
Net increase in net assets from operations $ 350,927 $ 226,173 $ 167,876 $ 203,576
----------- -------- ---------- ----------
Distributions to shareholders (Note 3) --
From net investment income $ (223,651) $ (119,802) $ (143,481) $ (117,954)
In excess of net investment income -- (1,539) (7,184) (3,078)
----------- -------- ---------- ----------
Total distributions to shareholders $ (223,651) $ (121,341) $ (150,665) $ (121,032)
----------- -------- ---------- ----------
Transactions in shares of beneficial interest (Note
4) --
Proceeds from sales of shares $1,624,592 $2,378,925 $ 938,555 $ 747,475
Net asset value of shares issued to shareholders
in payment of distributions declared 51,798 47,959 109,243 76,392
Cost of shares redeemed (812,635) (229,728) (2,043,937) (1,376,356)
----------- -------- ---------- ----------
Increase (decrease) in net assets from Fund
share transactions $ 863,755 $2,197,156 $ (996,139) $ (552,489)
----------- -------- ---------- ----------
Net increase (decrease) in net assets $ 991,031 $2,301,988 $ (978,928) $ (469,945)
NET ASSETS:
At beginning of year 3,101,421 1,245,693 3,742,854 2,799,707
----------- -------- ---------- ----------
At end of year $4,092,452 $3,547,681 $ 2,763,926 $2,329,762
=========== ======== ========== ==========
ACCUMULATED UNDISTRIBUTED (DISTRIBUTIONS IN EXCESS
OF) NET INVESTMENT INCOME INCLUDED IN NET ASSETS AT
END OF YEAR $ 1,944 $ (1,676) $ 422 $ 6,379
=========== ======== ========== ==========
</TABLE>
See notes to financial statements
17
<PAGE> 18
FINANCIAL STATEMENTS (continued)
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
For the Year Ended September 30, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TRADITIONAL TRADITIONAL TRADITIONAL
NEW YORK OHIO WEST VIRGINIA
FUND FUND FUND
----------- ----------- -------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations --
Net investment income $ 166,117 $ 96,497 $ 70,526
Net realized loss (24,131 ) (84,632 ) (45,288)
Change in unrealized appreciation 175,270 161,713 99,940
---------- -------- ----------
Net increase in net assets from operations $ 317,256 $ 173,578 $ 125,178
---------- -------- ----------
Distributions to shareholders (Note 3) --
From net investment income $ (166,117 ) $ (96,497 ) $ (70,526)
In excess of net investment income (4,961 ) (5,422 ) (2,437)
In excess of net realized gain (978 ) -- --
---------- -------- ----------
Total distributions to shareholders $ (172,056 ) $ (101,919 ) $ (72,963)
---------- -------- ----------
Transactions in shares of beneficial interest (Note 4) --
Proceeds from sales of shares $3,317,793 $ 522,879 $ 48,967
Net asset value of shares issued to shareholders in payment
of distributions declared 79,744 70,373 49,748
Cost of shares redeemed (497,277 ) (607,702 ) (1,015,933)
---------- -------- ----------
Increase (decrease) in net assets from Fund share
transactions $2,900,260 $ (14,450 ) $ (917,218)
---------- -------- ----------
Net increase (decrease) in net assets $3,045,460 $ 57,209 $ (865,003)
NET ASSETS:
At beginning of year 1,381,677 2,110,705 1,897,291
---------- -------- ----------
At end of year $4,427,137 $2,167,914 $ 1,032,288
========== ======== ==========
ACCUMULATED UNDISTRIBUTED (DISTRIBUTIONS IN EXCESS OF ) NET
INVESTMENT INCOME INCLUDED IN NET ASSETS AT END OF YEAR $ (5,243 ) $ (24 ) $ 3,005
========== ======== ==========
</TABLE>
See notes to financial statements
18
<PAGE> 19
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TRADITIONAL TRADITIONAL
CALIFORNIA FUND FLORIDA FUND
------------------------------- -------------------------------
YEAR ENDED SEPTEMBER 30, YEAR ENDED SEPTEMBER 30,
------------------------------- -------------------------------
1996 1995 1994** 1996 1995 1994**
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, beginning of year $10.180 $ 9.840 $10.000 $10.450 $10.020 $10.000
------- ------- ------- ------- ------- -------
INCOME (LOSS) FROM OPERATIONS:
Net investment income $ 0.601 $ 0.610 $ 0.209 $ 0.587 $ 0.587 $ 0.288
Net realized and unrealized gain (loss) 0.203 0.335 (0.158) 0.082 0.438 0.023++
------- ------- ------- ------- ------- -------
Total income from operations $ 0.804 $ 0.945 $ 0.051 $ 0.669 $ 1.025 $ 0.311
------- ------- ------- ------- ------- -------
LESS DISTRIBUTIONS:
From net investment income $(0.604) $(0.605) $(0.209) $(0.587) $(0.587) $(0.288)
In excess of net investment income -- -- (0.002) (0.002) (0.008) (0.003)
------- ------- ------- ------- ------- -------
Total distributions $(0.604) $(0.605) $(0.211) $(0.589) $(0.595) $(0.291)
------- ------- ------- ------- ------- -------
NET ASSET VALUE, end of year $10.380 $10.180 $ 9.840 $10.530 $10.450 $10.020
======= ======= ======= ======= ======= =======
TOTAL RETURN (2) 8.05% 9.94% 0.50% 6.55% 10.59% 3.10%
RATIOS/SUPPLEMENTAL DATA*:
Net assets, end of year (000 omitted) $ 6,168 $ 4,093 $ 3,101 $ 4,388 $ 3,548 $ 1,246
Ratio of net expenses to average daily
net assets (1)(3) 0.65% 0.63% 0.54%+ 0.67% 0.66% 0.50%+
Ratio of net expenses to average daily
net assets after custodian fee reduction
(1) 0.64% 0.62% -- 0.59% 0.61% --
Ratio of net investment income to
average daily net assets 5.83% 6.08% 5.60%+ 5.57% 5.68% 5.30%+
</TABLE>
* The operating expenses of the Funds reflect an allocation of expenses to the
Administrator or Investment Adviser. Had such actions not been taken, net
investment income per share and the ratios would have been as follows:
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
NET INVESTMENT INCOME PER SHARE $ 0.527 $ 0.513 $ 0.158 $ 0.532 $ 0.497 $ 0.081
======== ======== ========= ======== ======== =========
RATIOS(As a percentage of average daily
net assets):
Expenses (1)(3) 1.37% 1.60% 1.92%+ 1.19% 1.53% 2.48%+
Expenses after custodian fee reduction
(1) 1.36% 1.59% -- 1.11% 1.48% --
Net investment income 5.11% 5.11% 4.22%+ 5.05% 4.81% 3.32%+
+ Annualized.
++ The per share amount is not in accord with the net realized and unrealized gain (loss) for the period
because of the timing of sales of Fund shares and the amount of the per share realized and unrealized
gains and losses at such time.
** For the Traditional California and the Traditional Florida Funds, the Financial Highlights are for the
period from the start of business, May 27, 1994 and April 5, 1994, respectively, to September 30,
1994.
(1) Includes each Fund's share of its corresponding Portfolio's allocated expenses.
(2) Total return is calculated assuming a purchase at the net asset value on the first day and a sale at
the net asset value on the last day of each period reported. Dividends and distributions, if any, are
assumed to be reinvested at the net asset value on the payable date. Total return is computed on a
non-annualized basis.
(3) The expense ratios for the years ended September 30, 1996 and 1995 have been adjusted to reflect a
change in reporting requirements. The new reporting guidelines require each Fund to increase its
expense ratio by the effect of any expense offset arrangements with its service providers. The expense
ratios for the period ended September 30, 1994 have not been adjusted to reflect this change.
</TABLE>
See notes to financial statements
19
<PAGE> 20
FINANCIAL STATEMENTS (continued)
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TRADITIONAL TRADITIONAL
MASSACHUSETTS FUND MISSISSIPPI FUND
------------------------------- -------------------------------
YEAR ENDED SEPTEMBER 30, YEAR ENDED SEPTEMBER 30,
------------------------------- -------------------------------
1996 1995 1994* 1996 1995 1994*
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, beginning of year $ 9.260 $ 9.000 $10.000 $ 9.300 $ 8.920 $10.000
------- ------- ------- ------- ------- -------
INCOME (LOSS) FROM OPERATIONS:
Net investment income $ 0.490++ $ 0.449 $ 0.350 $ 0.456++ $ 0.426 $ 0.338
Net realized and unrealized gain (loss) 0.062++ 0.283 (0.933) 0.140++ 0.391 (1.024)
------- ------- ------- ------- ------- -------
Total income (loss) from operations $ 0.552 $ 0.732 $(0.583) $ 0.596 $ 0.817 $(0.686)
------- ------- ------- ------- ------- -------
LESS DISTRIBUTIONS:
From net investment income $(0.494) $(0.449) $(0.350) $(0.476) $(0.426) $(0.338)
In excess of net investment income (0.018) (0.023) (0.067) -- (0.011) (0.056)
------- ------- ------- ------- ------- -------
Total distributions $(0.512) $(0.472) $(0.417) $(0.476) $(0.437) $(0.394)
------- ------- ------- ------- ------- -------
NET ASSET VALUE, end of year $ 9.300 $ 9.260 $ 9.000 $ 9.420 $ 9.300 $ 8.920
======= ======= ======= ======= ======= =======
TOTAL RETURN (2) 6.19% 8.45% (6.02)% 6.64% 9.47% (6.96)%
RATIOS/SUPPLEMENTAL DATA**:
Net assets, end of year (000 omitted) $ 6,045 $ 2,764 $ 3,743 $ 1,208 $ 2,330 $ 2,800
Ratio of net expenses to average daily
net assets (1)(3) 0.98% 1.53% 1.61%+ 1.13% 1.48% 1.24%+
Ratio of net expenses to average daily
net assets after custodian fee reduction
(1) 0.97% 1.51% -- 1.10% 1.44% --
Ratio of net investment income to
average daily net assets 5.33% 5.05% 4.55%+ 4.88% 4.79% 4.42%+
</TABLE>
** The operating expenses of the Funds and the Portfolios may reflect a
reduction of the investment advisory fee and/or an allocation of expenses to
the Administrator or Investment Adviser or both. Had such actions not been
taken, net investment income per share and the ratios would have been as
follows:
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
NET INVESTMENT INCOME PER SHARE $ 0.430 $ 0.405 $ 0.260 $ 0.358 $ 0.364 $ 0.246
======== ======== ======== ======== ======== ========
RATIOS (As a percentage of average daily
net assets):
Expenses (1)(3) 1.63% 2.02% 2.78%+ 2.18% 2.18% 2.45%+
Expenses after custodian fee reduction
(1) 1.62% 2.00% -- 2.15% 2.14% --
Net investment income 4.68% 4.56% 3.38%+ 3.83% 4.09% 3.21%+
+ Annualized.
++ Per share amounts have been calculated using average shares outstanding.
(1) Includes each Fund's share of its corresponding Portfolio's allocated expenses.
(2) Total return is calculated assuming a purchase at the net asset value on the first day and a sale at
the net asset value on the last day of each period reported. Dividends and distributions, if any, are
assumed to be reinvested at the net asset value on the payable date. Total return is computed on a
non-annualized basis.
(3) The expense ratios for the years ended September 30, 1996 and 1995 have been adjusted to reflect a
change in reporting requirements. The new reporting guidelines require each Fund to increase its
expense ratio by the effect of any expense offset arrangements with its service providers. The expense
ratios for the period ended September 30, 1994 have not been adjusted to reflect this change.
* For the Traditional Massachusetts and Traditional Mississippi Funds, the Financial Highlights are for
the period from the start of business, December 7, 1993, to September 30, 1994.
</TABLE>
See notes to financial statements
20
<PAGE> 21
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TRADITIONAL TRADITIONAL
NEW YORK FUND OHIO FUND
------------------------------- -------------------------------
YEAR ENDED SEPTEMBER 30, YEAR ENDED SEPTEMBER 30,
------------------------------- -------------------------------
1996 1995 1994* 1996 1995 1994*
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, beginning of year $10.150 $ 9.780 $10.000 $ 9.320 $ 8.940 $10.000
------- ------- ------- ------- ------- -------
INCOME (LOSS) FROM OPERATIONS:
Net investment income $ 0.570++ $ 0.583 $ 0.271 $ 0.486 $ 0.428 $ 0.348
Net realized and unrealized gain (loss) 0.095++ 0.390 (0.214) 0.064 0.404 (0.992)
------- ------- ------- ------- ------- -------
Total income (loss) from operations $ 0.665 $ 0.973 $ 0.057 $ 0.550 $ 0.832 $(0.644)
------- ------- ------- ------- ------- -------
LESS DISTRIBUTIONS:
From net investment income $(0.571) $(0.583) $(0.271) $(0.486) $(0.428) $(0.348)
In excess of net investment income (0.024) (0.017) (0.006) (0.004) (0.024) (0.068)
In excess of net realized gain -- (0.003) -- -- -- --
------- ------- ------- ------- ------- -------
Total distributions $(0.595) $(0.603) $(0.277) $(0.490) $(0.452) $(0.416)
------- ------- ------- ------- ------- -------
NET ASSET VALUE, end of year $10.220 $10.150 $ 9.780 $ 9.380 $ 9.320 $ 8.940
======= ======= ======= ======= ======= =======
TOTAL RETURN (2) 6.69% 10.32% 0.56% 6.12% 9.64% (6.75)%
RATIOS/SUPPLEMENTAL DATA**:
Net assets, end of year (000 omitted) $ 7,025 $ 4,427 $ 1,382 $ 1,959 $ 2,168 $ 2,111
Ratio of net expenses to average daily
net assets (1)(3) 0.59% 0.59% 0.44%+ 1.11% 1.56% 1.60%+
Ratio of net expenses to average daily
net assets after custodian fee reduction
(1) 0.56% 0.50% -- 1.06% 1.54% --
Ratio of net investment income to average
daily net assets 5.55% 5.77% 5.36%+ 5.14% 4.76% 4.42%+
</TABLE>
** The operating expenses of the Funds reflect a reduction of expenses by the
Administrator. Had such actions not been taken, net investment income per
share and the ratios would have been as follows:
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
NET INVESTMENT INCOME PER SHARE $ 0.525 $ 0.512 $ 0.156 $ 0.397 $ 0.336 $ 0.241
======== ======== ======== ======== ======== ========
RATIOS (As a percentage of average daily
net assets):
Expenses (1)(3) 1.03% 1.29% 2.71%+ 2.05% 2.58% 2.96%+
Expenses after custodian fee reduction
(1) 1.00% 1.20% -- 2.00% 2.56% --
Net investment income 5.11% 5.07% 3.09%+ 4.20% 3.74% 3.06%+
+ Annualized.
++ Per share amounts have been calculated using average shares outstanding.
(1) Includes each Fund's share of its corresponding Portfolio's allocated expenses.
(2) Total return is calculated assuming a purchase at the net asset value on the first day and a sale at
the net asset value on the last day of each period reported. Dividends and distributions, if any, are
assumed to be reinvested at the net asset value on the payable date. Total return is computed on a
non-annualized basis.
(3) The expense ratios for the years ended September 30, 1996 and 1995 have been adjusted to reflect a
change in reporting requirements. The new reporting guidelines require each Fund to increase its
expense ratio by the effect of any expense offset arrangements with its service providers. The expense
ratios for the period ended September 30, 1994 have not been adjusted to reflect this change.
* For the Traditional New York and Traditional Ohio Funds, the Financial Highlights are for the period
from the start of business, April 15, 1994 and December 7, 1993, respectively, to September 30, 1994.
</TABLE>
See notes to financial statements
21
<PAGE> 22
FINANCIAL STATEMENTS (continued)
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TRADITIONAL
WEST VIRGINIA FUND
-------------------------------
YEAR ENDED SEPTEMBER 30,
-------------------------------
1996 1995 1994*
------- ------- -------
<S> <C> <C> <C>
NET ASSET VALUE, beginning of year $ 9.350 $ 8.980 $10.000
------- ------- -------
INCOME (LOSS) FROM OPERATIONS:
Net investment income $ 0.433 $ 0.427 $ 0.326
Net realized and unrealized gain (loss) 0.139 0.385 (0.959)
------- ------- -------
Total income (loss) from operations $ 0.572 $ 0.812 $(0.633)
------- ------- -------
LESS DISTRIBUTIONS:
From net investment income $(0.456) $(0.427) $(0.326)
In excess of net investment income (0.016) (0.015) (0.061)
------- ------- -------
Total distributions $(0.472) $(0.442) $(0.387)
------- ------- -------
NET ASSET VALUE, end of year $ 9.450 $ 9.350 $ 8.980
======= ======= =======
TOTAL RETURN (2) 6.45% 9.35% (6.53)%
RATIOS/SUPPLEMENTAL DATA**:
Net assets, end of year (000 omitted) $ 1,585 $ 1,032 $ 1,897
Ratio of net expenses to average daily net assets (1)(3) 1.10% 1.35% 1.28%+
Ratio of net expenses to average daily net assets after custodian fee
reduction (1) 1.06% 1.33% --
Ratio of net investment income to average daily net assets 4.64% 4.81% 4.53%+
</TABLE>
** The operating expenses of the Fund and the Portfolio may reflect a reduction
of the investment advisory fee and/or an allocation of expenses to the
Administrator or Investment Adviser or both. Had such actions not been taken,
net investment income per share and the ratios would have been as follows:
<TABLE>
<S> <C> <C> <C>
NET INVESTMENT INCOME PER SHARE $ 0.310 $ 0.318 $ 0.204
======== ======== ========
RATIOS (As a percentage of average daily net assets):
Expenses (1)(3) 2.41% 2.58% 2.66%+
Expenses after custodian fee reduction (1) 2.37% 2.56% --
Net investment income 3.33% 3.58% 3.15%+
+ Annualized.
(1) Includes the Fund's share of its corresponding Portfolio's allocated expenses.
(2) Total return is calculated assuming a purchase at the net asset value on the first day and a sale at
the net asset value on the last day of each period reported. Dividends and distributions, if any, are
assumed to be reinvested at the net asset value on the payable date. Total return is not computed on a
non-annualized basis.
(3) The expense ratios for the years ended September 30, 1996 and 1995 have been adjusted to reflect a
change in reporting requirements. The new reporting guidelines require the Fund to increase its expense
ratio by the effect of any expense offset arrangements with its service providers. The expense ratios
for the period ended September 30, 1994 have not been adjusted to reflect this change.
* For the period from the start of business, December 13, 1993, to September 30, 1994.
</TABLE>
See notes to financial statements
22
<PAGE> 23
Notes to Financial Statements
- --------------------------------------------------------------------------------
(1) SIGNIFICANT ACCOUNTING POLICIES
Eaton Vance Municipals Trust (the Trust) is an entity of the type commonly known
as a Massachusetts business trust and is registered under the Investment Company
Act of 1940, as amended, as an open-end management investment company. The Trust
presently consists of sixty-six Funds, seven of which are included in these
financial statements. They include EV Traditional California Municipals Fund
("Traditional California Fund"), EV Traditional Florida Municipals Fund,
("Traditional Florida Fund"), EV Traditional Massachusetts Municipals Fund
("Traditional Massachusetts Fund"), EV Traditional Mississippi Municipals Fund,
("Traditional Mississippi Fund"), EV Traditional New York Municipals Fund
("Traditional New York Fund"), EV Traditional Ohio Municipals Fund,
("Traditional Ohio Fund") and EV Traditional West Virginia Municipals Fund
("Traditional West Virginia Fund"), each of which is registered under the
Investment Company Act of 1940 as a non-diversified open-end management
investment company. Each Fund invests all of its investable assets in interests
in a separate corresponding open-end management investment company (a
"Portfolio"), a New York Trust, having the same investment objective as its
corresponding Fund. The Traditional California Fund invests its assets in the
California Municipals Portfolio, the Traditional Florida Fund invests its assets
in the Florida Municipals Portfolio, the Traditional Massachusetts Fund invests
its assets in the Massachusetts Municipals Portfolio, the Traditional
Mississippi Fund invests its assets in the Mississippi Municipals Portfolio, the
Traditional New York Fund invests its assets in the New York Municipals
Portfolio, the Traditional Ohio Fund invests its assets in the Ohio Municipals
Portfolio and the Traditional West Virginia Fund invests its assets in the West
Virginia Municipals Portfolio. The value of each Fund's investment in its
corresponding Portfolio reflects the Fund's proportionate interest in the net
assets of that Portfolio (1.7%, 0.7%, 2.1%, 4.7%, 1.2%, 0.7% and 4.0% at
September 30, 1996 for the Traditional California Fund, Traditional Florida
Fund, Traditional Massachusetts Fund, Traditional Mississippi Fund, Traditional
New York Fund, Traditional Ohio Fund and Traditional West Virginia Fund,
respectively). The performance of each Fund is directly affected by the
performance of its corresponding Portfolio. The financial statements of each
Portfolio, including the portfolio of investments, are included elsewhere in
this report and should be read in conjunction with each Fund's financial
statements. The following is a summary of significant accounting policies
consistently followed by the Trust in the preparation of its financial
statements. The policies are in conformity with generally accepted accounting
principles.
A. INVESTMENT VALUATION--Valuation of securities by the Portfolios is discussed
in Note 1A of the Portfolios' Notes to Financial Statements which are included
elsewhere in this report.
B. INCOME--Each Fund's net investment income consists of the Fund's pro rata
share of the net investment income of its corresponding Portfolio, less all
actual and accrued expenses of each Fund determined in accordance with generally
accepted accounting principles.
C. FEDERAL TAXES--Each Fund's policy is to comply with the provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute to shareholders each year all of its taxable and tax-exempt income,
including any net realized gain. Accordingly, no provision for Federal income or
excise tax is necessary. At September 30, 1996, the Funds, for Federal income
tax purposes, had capital loss carryovers, which will reduce taxable income
arising from future net realized gain, if any, to the extent permitted by the
Internal Revenue Code, and thus will reduce the amount of the distributions to
shareholders which would otherwise be necessary to relieve the Funds of any
liability for Federal income or excise tax. The amounts and expiration dates of
capital loss carryovers are as follows:
<TABLE>
<CAPTION>
FUND AMOUNT EXPIRES
- -------------------------------- --------- -------------------
<S> <C> <C>
Traditional California Fund $ 42,738 September 30, 2003
Traditional Florida Fund $ 28,366 September 30, 2004
2,396 September 30, 2003
636 September 30, 2002
Traditional Massachusetts Fund $ 198,425 September 30, 2004
14,863 September 30, 2003
85,630 September 30, 2002
Traditional Mississippi Fund $ 178,545 September 30, 2004
20,891 September 30, 2003
65,533 September 30, 2002
Traditional New York Fund $ 15,756 September 30, 2004
3,063 September 30, 2003
Traditional Ohio Fund $ 68,805 September 30, 2004
4,540 September 30, 2003
15,584 September 30, 2002
Traditional West Virginia Fund $ 44,054 September 30, 2004
4,513 September 30, 2003
20,474 September 30, 2002
</TABLE>
Additionally, at September 30, 1996, net capital losses of $16,192 for the
Traditional West Virginia Fund, attributable to security transactions incurred
after October 31, 1995, are treated as arising on the first day of the Fund's
next taxable year.
Dividends paid by each Fund from net interest on tax-exempt municipal bonds
allocated from its corresponding Portfolio are not includable by shareholders as
gross income for Federal income tax purposes because each Fund and Portfolio
intend to meet certain requirements of the Internal Revenue Code applicable to
regulated investment companies which will enable the Funds to pay
exempt-interest dividends. The portion of such interest, if any, earned on
private activity
23
<PAGE> 24
- --------------------------------------------------------------------------------
bonds issued after August 7, 1986, may be considered a tax preference item to
shareholders.
D. DEFERRED ORGANIZATION EXPENSES--Costs incurred by a Fund in connection with
its organization, including registration costs, are being amortized on the
straight-line basis over five years.
E. 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 assets and liabilities at
the date of the financial statements and the reported amounts of revenue and
expense during the reporting period. Actual results could differ from those
estimates.
F. OTHER--Investment transactions are accounted for on a trade date basis.
G. EXPENSE REDUCTION--Investors Bank & Trust Company (IBT) serves as custodian
to the Funds and the Portfolios. Prior to November 10, 1995, IBT was an
affiliate of EVM. Pursuant to the respective custodian agreements, IBT receives
a fee reduced by credits which are determined based on the average cash balances
the Funds or the Portfolios maintain with IBT. All significant credit balances
used to reduce each Fund's custodian fees are reported as a reduction of
expenses on the statements of operations.
- --------------------------------------------------------------------------------
(2) FUND NAME CHANGES
Effective February 1, 1996, the EV Classic Massachusetts Municipals Fund, EV
Classic Mississippi Municipals Fund, EV Classic Ohio Municipals Fund and EV
Classic West Virginia Municipals Fund changed their respective names to EV
Traditional Massachusetts Municipals Fund, EV Traditional Mississippi Municipals
Fund, EV Traditional Ohio Municipals Fund and EV Traditional West Virginia
Municipals Fund. In addition, each Fund discontinued the payment of sales
commissions and distribution fees to the Principal Underwriter pursuant to a
Distribution Plan (see Note 7). The Funds have adopted a new service plan (see
Note 6) which allows for the continued payment of service fees to the principal
underwriter and authorized firms. Purchases of the Fund shares on or after
February 1, 1996 will be subject to a maximum initial sales charge of 3.75% on
amounts up to $50,000 and at declining rates on purchases in excess of such
amount.
24
<PAGE> 25
- --------------------------------------------------------------------------------
(3) DISTRIBUTIONS TO SHAREHOLDERS
The net income of each Fund is determined daily and substantially all of the net
income so determined is declared as a dividend to shareholders of record at the
time of declaration. Distributions are paid monthly. Distributions of allocated
realized capital gains, if any, are made at least annually. Shareholders may
reinvest capital gain distributions in additional shares of a Fund at the net
asset value as of the ex-dividend date. Distributions are paid in the form of
additional shares or, at the election of the shareholder, in cash. The Funds
distinguish between distributions on a tax basis and a financial reporting
basis. Generally accepted accounting principles require that only distributions
in excess of tax basis earnings and profits be reported in the financial
statements as a return of capital. Differences in the recognition or
classification of income between the financial statements and tax earnings and
profits which result in temporary over distributions for financial statement
purposes are classified as distributions in excess of net investment income or
accumulated net realized gains. Permanent differences between book and tax
accounting relating to distributions are reclassified to paid-in capital. During
the year ended September 30, 1996, the following reclassifications were made due
to permanent differences between book and tax accounting for certain
distributions related to capital gains:
<TABLE>
<CAPTION>
TRADITIONAL TRADITIONAL
NEW YORK WEST VIRGINIA
INCREASE/(DECREASE) FUND FUND
- ---------------------------------------------------------------------------- ----------- -------------
<S> <C> <C>
Accumulated net realized loss $ (49) --
Accumulated distributions in excess of net investment
income 4,847 $ 397
Paid-in capital (4,798) (397)
</TABLE>
Net investment income, net realized gains and net assets were not affected by
these reclassifications.
The tax treatment of distributions for the calendar year will be reported to
shareholders prior to February 1, 1997 and will be based on tax accounting
methods which may differ from amounts determined for financial statement
purposes.
- --------------------------------------------------------------------------------
(4) SHARES OF BENEFICIAL INTEREST
The Funds' Declaration of Trust permits the Trustees to issue an unlimited
number of full and fractional shares of beneficial interest (without par value).
Transactions in Fund shares were as follows:
<TABLE>
<CAPTION>
TRADITIONAL TRADITIONAL TRADITIONAL TRADITIONAL
CALIFORNIA FUND FLORIDA FUND MASSACHUSETTS FUND MISSISSIPPI FUND
-------------------- ------------------ ----------------------- ---------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30,
-------------------- ------------------ ----------------------- ---------------------
1996 1995 1996 1995 1996 1995 1996 1995
-------- --------- -------- ------- ---------- ---------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Sales 409,986 165,155 172,837 232,635 503,000 103,012 7,403 85,045
Issued to shareholders electing
to receive payment of
distributions in Fund shares 9,874 5,199 6,600 4,700 14,166 12,218 6,342 8,505
Redemptions (227,619) (83,462) (101,832) (22,345) (165,434) (232,568) (136,136) (156,634)
------- ------- -------- ------- -------- -------- -------- --------
Net increase (decrease) 192,241 86,892 77,605 214,990 351,732 (117,338) (122,391) (63,084)
======= ======= ======== ======= ======== ======== ======== ========
</TABLE>
25
<PAGE> 26
- --------------------------------------------------------------------------------
(4) SHARES OF BENEFICIAL INTEREST (CONTINUED)
<TABLE>
<CAPTION>
TRADITIONAL TRADITIONAL TRADITIONAL
NEW YORK FUND OHIO FUND WEST VIRGINIA FUND
----------------- ------------------ -------------------
YEAR ENDED YEAR ENDED YEAR ENDED
SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30,
----------------- ------------------ -------------------
1996 1995 1996 1995 1996 1995
------- ------- -------- ------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Sales 330,962 336,733 34,079 58,811 95,496 5,454
Issued to shareholders electing
to receive payment of
distributions in Fund shares 16,071 8,010 8,016 7,852 4,528 5,559
Redemptions (96,282) (49,664) (66,023) (70,065) (42,695) (111,885)
-------- ------- ------- ------- ------- --------
Net increase (decrease) 250,751 295,079 (23,928) (3,402) 57,329 (100,872)
======== ======= ======= ======= ======= ========
</TABLE>
- --------------------------------------------------------------------------------
(5) TRANSACTIONS WITH AFFILIATES
Eaton Vance Management (EVM) serves as the Administrator of each Fund, but
receives no compensation. The Portfolios have engaged Boston Management and
Research (BMR), a subsidiary of EVM, to render investment advisory services. See
Note 2 of the Portfolios' Notes to Financial Statements which are included
elsewhere in this report. To enhance the net income of the Funds for the year
ended September 30, 1996, $25,389, $20,337, $22,401, $15,479, $25,729, $19,500
and $15,088 of expenses relating to the operation of the Traditional California
Fund, Traditional Florida Fund, Traditional Massachusetts Fund, Traditional
Mississippi Fund, Traditional New York Fund, Traditional Ohio Fund, and
Traditional West Virginia Fund, respectively, were allocated to EVM. Except as
to Trustees of the Funds and the Portfolios who are not members of EVM's or
BMR's organization, officers and Trustees receive remuneration for their
services to each Fund out of such investment adviser fee.
Certain of the officers and Trustees of the Funds and Portfolios are officers
and directors/trustees of the above organizations.
- --------------------------------------------------------------------------------
(6) SERVICE PLAN
Each Fund has adopted a service plan (the Plan) designed to meet the service fee
requirements of the sales charge rule of The National Association of Securities
Dealers, Inc. The Plans provide that each Fund may make service fee payments to
the Principal Underwriter, Eaton Vance Distributors, Inc. (EVD), a subsidiary of
Eaton Vance Management, Authorized Firms or other persons in amounts not
exceeding 0.25% of each Fund's average daily net assets for any fiscal year. The
Trustees have initially implemented each Plan by authorizing the Fund to make
quarterly service fee payments to the Principal Underwriter and Authorized Firms
in amounts not exceeding 0.20% (0.25% for the Traditional California Fund) of
each Fund's average daily net assets for any fiscal year which is attributable
to shares of a Fund sold by such persons and remaining outstanding for at least
one year. Service fee payments are made for personal services and/or the
maintenance of shareholder accounts. For the year ended September 30, 1996, the
Traditional California, Traditional Florida and Traditional New York Funds paid
or accrued service fees of $3,551, $2,650 and $4,127, respectively. For the
period from February 1, 1996, to September 30, 1996, the Traditional
Massachusetts, Traditional Mississippi, Traditional Ohio and Traditional West
Virginia Funds paid or accrued services fees of $4,847, $1,664, $2,650 and
$1,590, respectively.
Certain of the officers and Trustees of the Funds are officers and directors of
EVD.
26
<PAGE> 27
- --------------------------------------------------------------------------------
(7) DISTRIBUTION PLAN
Prior to February 1, 1996, Traditional Massachusetts Fund, Traditional
Mississippi Fund, Traditional Ohio Fund and Traditional West Virginia Fund had
adopted a distribution plan (the Plans) pursuant to Rule 12b-1 under the
Investment Company Act of 1940. The Plans required the Funds to pay EVD amounts
equal to 1/365 of 0.75% of each Funds' daily net assets, for providing ongoing
distribution services and facilities to the respective Fund. A Fund would
automatically discontinue payments to EVD during any period in which there were
no outstanding Uncovered Distribution Charges, which are equivalent to the sum
of (i) 6.25% of the aggregate amount received by the Fund for shares sold plus
(ii) distribution fees calculated by applying the rate of 1% over the prevailing
prime rate to the outstanding balance of Uncovered Distribution Charges of EVD,
reduced by the aggregate amount of contingent deferred sales charges and amounts
theretofore paid to EVD. The amount payable to EVD with respect to each day was
accrued on such day as a liability of each Fund and, accordingly, reduced the
Fund's net assets. For the period from October 1, 1995 to January 31, 1996,
Traditional Massachusetts Fund, Traditional Mississippi Fund, Traditional Ohio
Fund, and Traditional West Virginia Fund, paid $7,134, $5,938, $5,747, and
$2,622, respectively, to EVD representing 0.75% (annualized) of average daily
net assets. At September 30, 1996, the amount of Uncovered Distribution Charges
of EVD calculated under the Plans for Traditional Massachusetts Fund,
Traditional Mississippi Fund, Traditional Ohio Fund and Traditional West
Virginia Fund were approximately $337,000, $287,000, $251,000 and $169,000,
respectively.
In addition, the Plans permitted the Funds to make monthly payments of service
fees to EVD, in amounts not exceeding 0.25% of each Fund's average daily net
assets for any fiscal year. The Trustees had initially implemented the Plans by
authorizing the Funds to make monthly service fee payments to the Principal
Underwriter in amounts not expected to exceed 0.20% of each Fund's average daily
net assets for each fiscal year. For the period from October 1, 1995 to January
31, 1996, Traditional Massachusetts Fund, Traditional Mississippi Fund,
Traditional Ohio Fund and Traditional West Virginia Fund paid service fees to
EVD in the amount of $1,903, $1,583, $1,533 and $699, respectively. During the
first year after a purchase of Fund shares, EVD retained the service fee as
reimbursement for the service fee payment made to the Authorized Firm at the
time of sale. Thereafter, EVD was expected to make monthly service fee payments
to Authorized Firms equal to 0.20% per annum of the Fund's average daily net
assets based on the value of the Fund's shares sold by such authorized firm and
remaining outstanding for at least one year. Service fee payments were made for
personal services and/or maintenance of shareholder accounts. Service fees paid
to EVD and Authorized Firms were separate and distinct from the sales
commissions and distribution fees payable by a Fund to EVD, and as such are not
subject to automatic discontinuance when there are no outstanding Uncovered
Distribution Charges of EVD.
Certain of the officers and Trustees of the Funds are officers or directors of
EVD.
- --------------------------------------------------------------------------------
(8) CONTINGENT DEFERRED SALES CHARGES
For shares of the Traditional Massachusetts Fund, Traditional Mississippi Fund,
Traditional Ohio Fund and Traditional West Virginia Fund purchased between
January 30, 1995 and January 31, 1996, a contingent deferred sales charge (CDSC)
of 1% is imposed on any redemption of Fund shares made within one year of
purchase. The CDSC is based upon the lower of the net asset value at date of
redemption or date of purchase. No charge is levied on shares acquired by
reinvestment of dividends or capital gains distributions. No CDSC is levied on
shares which have been sold to EVD or its affiliates or to their respective
employees. CDSC charges are paid to EVD to reduce the amount of Uncovered
Distribution Charges calculated under the Funds' Distribution Plans. CDSC
received when no Uncovered Distribution Charges exist will be credited to the
Funds. For the year ended September 30, 1996, EVD received approximately $660
and $350 of CDSC paid by shareholders of Traditional Massachusetts Fund and
Traditional Ohio Fund, respectively. EVD did not receive any CDSC from
shareholders redeeming out of the Traditional Mississippi Fund and Traditional
West Virginia Fund during the year ended September 30, 1996.
27
<PAGE> 28
- --------------------------------------------------------------------------------
(9) INVESTMENT TRANSACTIONS
Increases and decreases in each Fund's investment in its corresponding Portfolio
for the year ended September 30, 1996 were as follows:
<TABLE>
<CAPTION>
TRADITIONAL TRADITIONAL TRADITIONAL TRADITIONAL
CALIFORNIA FLORIDA MASSACHUSETTS MISSISSIPPI
FUND FUND FUND FUND
----------- ----------- ------------- -----------
<S> <C> <C> <C> <C>
Increases $4,298,137 $1,948,335 $ 4,700,523 $ 106,990
Decreases 2,533,289 1,251,214 1,648,851 1,370,310
</TABLE>
<TABLE>
<CAPTION>
TRADITIONAL TRADITIONAL TRADITIONAL
NEW YORK OHIO WEST VIRGINIA
FUND FUND FUND
----------- ----------- -------------
<S> <C> <C> <C> <C>
Increases $3,439,151 $ 401,300 $ 921,007
Decreases 1,186,556 700,010 463,182
</TABLE>
28
<PAGE> 29
Independent Auditors' Report
- --------------------------------------------------------------------------------
TO THE TRUSTEES AND SHAREHOLDERS OF EATON VANCE MUNICIPALS TRUST:
We have audited the accompanying statements of assets and liabilities of EV
Traditional California Municipals Fund, EV Traditional Florida Municipals Fund,
EV Traditional Massachusetts Municipals Fund, EV Traditional Mississippi
Municipals Fund, EV Traditional New York Municipals Fund, EV Traditional Ohio
Municipals Fund, and EV Traditional West Virginia Municipals Fund (the Funds)
(certain of the series of Eaton Vance Municipals Trust) as of September 30,
1996, the related statements of operations for the year then ended, and the
statements of changes in net assets for the years ended September 30, 1996 and
1995 and the financial highlights for each year in the three-year period ended
September 30, 1996. These financial statements and financial highlights are the
responsibility of the Trust's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion such financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
aforementioned funds of Eaton Vance Municipals Trust at September 30, 1996, the
results of their operations, the changes in their net assets and their financial
highlights for the respective stated periods in conformity with generally
accepted accounting principles.
DELOITTE & TOUCHE LLP
BOSTON, MASSACHUSETTS
NOVEMBER 1, 1996
29
<PAGE> 30
California Municipals Portfolio
Portfolio of Investments - September 30, 1996
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS - 100%
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
COGENERATION - 6.0%
NR BBB- $ 4,985 Central Valley Financing
Authority, Carson Ice,
6.20%, 7/1/20 $ 4,965,957
NR BBB- 10,900 Sacramento Cogeneration
Authority, Procter &
Gamble, 6.50%, 7/1/21 11,126,611
NR BBB- 6,000 Sacramento Power
Authority, Cogeneration
Project, 6.00%, 7/1/22 5,823,420
------------
$ 21,915,988
------------
ESCROWED - 17.1%
NR NR $ 1,575 Fontana Public Financing
Authority, 7.75%,
12/1/20 $ 1,829,347
NR NR 4,000 Huntington Beach Public
Financing Authority,
8.375%, 5/1/18 4,333,480
NR BBB 3,190 Orange Cove Irrigation
District COP, 6.625%,
2/1/17 3,493,018
Aaa AAA 6,400 Port of Oakland, (BIGI)
0%, 11/1/15 3,955,264
NR NR 3,000 Poway Redevelopment
Agency, 7.75%, 12/15/21 3,494,880
NR BBB 2,000 City of Rancho Mirage,
Joint Power Financing
Authority, 7.50%, 4/1/17 2,270,040
NR A- 2,360 Richmond Joint Power
Financing Authority,
7.00%, 5/15/07 2,599,092
Aaa AAA 8,000 County of Sacramento,
SFMR, (AMT), (GNMA)
8.125%, 7/1/16 (2) 10,058,640
Aaa AAA 14,285 County of Sacramento,
SFMR, (AMT), (GNMA)
8.50%, 11/1/16 18,721,492
Aaa AAA 6,000 County of Sacramento,
SFMR, (AMT), (GNMA)
8.25%, 1/1/21 7,758,600
Aaa AAA 3,000 City and County of San
Francisco Sewer System,
(AMBAC), Variable,
10/1/21 (1) 3,450,540
------------
$ 61,964,393
------------
GENERAL OBLIGATION - 1.3%
Aa AA $ 5,000 East Bay Municipal
Utilities District,
5.00%, 4/1/15 $ 4,592,350
------------
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
HOSPITALS - 2.3%
Ba NR $ 1,000 City of San Bernadino,
San Bernadino Community
Hospital, 7.875%,
12/1/08 $ 1,009,700
Ba NR 3,000 City of San Bernadino,
San Bernadino Community
Hospital, 7.875%,
12/1/19 3,029,100
NR BBB+ 2,700 City of Stockton,
Dameron Hospital
Association, 8.30%,
12/1/14 2,812,509
NR BBB- 1,500 City of Woodland,
Woodland Memorial
Hospital, 8.20%, 8/1/15 1,585,725
------------
$ 8,437,034
------------
HOUSING - 7.7%
NR NR $ 2,000 Los Angeles County,
Corporate Fund Housing
Authority, 10.50%,
12/1/29 $ 2,044,680
NR A+ 1,785 City of Oakland, Housing
Finance Agency (HFA),
7.10%, 1/1/10 1,829,286
Aa AA- 2,500 California HFA, 8.20%,
8/1/17 2,594,550
Aa AA- 1,270 California HFA, (AMT),
8.60%, 8/1/19 1,326,490
Aa AA- 3,575 California HFA, (AMT),
7.375%, 8/1/11 3,724,542
Aa AA- 6,345 California HFA, (AMT),
(FHA) 7.65%, 8/1/23 6,629,066
Aa AA- 4,730 California HFA, (AMT),
7.40%, 8/1/26 4,987,738
Aa AA- 3,845 California HFA, (AMT),
7.50%, 8/1/25 4,080,391
A1 NR 795 Los Angeles County,
SFMR, 7.875%, 8/1/16 808,077
------------
$ 28,024,820
------------
INSURED EDUCATION - 0.8%
Aaa AAA $ 3,330 University of
California, Multiple
Purpose Project, (MBIA)
4.75%, 9/1/21 $ 2,868,162
------------
INSURED LEASE/CERTIFICATE OF
PARTICIPATION - 5.0%
Aaa AAA $ 3,300 California Statewide
Communities Development
Authority, Motion
Picture and Television
Fund, (AMBAC), Variable,
1/1/24 (1) $ 2,991,153
</TABLE>
30
<PAGE> 31
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED LEASE/CERTIFICATE OF
PARTICIPATION - (CONTINUED)
Aaa AAA 7,700 Moulton Niguel Water
District, (AMBAC) 4.80%,
9/1/17 6,765,143
Aaa AAA 4,350 City of Stockton,
Wastewater Treatment
Plant, (FGIC) 6.80%,
9/1/24 4,806,533
Aaa AAA 13,985 Visalia Unified School
District, (MBIA) 0%,
12/1/17 3,501,284
------------
$ 18,064,113
------------
INSURED SPECIAL TAX - 2.3%
Aaa AAA $ 4,850 City of San Jose
Redevelopment Agency,
(MBIA) 4.75%, 8/1/24 $ 4,174,298
Aaa AAA 2,000 Thousand Oaks
Redevelopment Agency,
(MBIA) 5.375%, 12/1/25 1,891,660
Aaa AAA 2,500 Los Angeles County Metro
Trans Authority, (AMBAC)
5.25%, 7/1/23 2,326,875
------------
$ 8,392,833
------------
INSURED TRANSPORTATION - 3.9%
Aaa AAA $ 8,000 City and County of San
Francisco Airport,
(MBIA) 6.75%, 5/1/13 $ 8,745,440
Aaa AAA 3,500 City and County of San
Francisco Airport,
(AMT), (MBIA) 5.625%,
5/1/21 3,415,615
Aaa AAA 10,000 Port of Oakland, (AMT),
(BIGI), 0%, 11/1/19 1,866,400
------------
$ 14,027,455
------------
INSURED UTILITIES - 5.7%
Aaa AAA $ 8,000 Northern California
Power Agency, (MBIA),
Variable, 8/1/25 (1) $ 8,969,360
Aaa AAA 3,500 Sacramento Municipal
Utilities District,
(MBIA) 6.375%, 8/15/22 3,679,445
Aaa AAA 2,000 Southern California
Public Power Authority,
(FGIC), Variable, 7/1/12
(1) 1,844,580
Aaa AAA 6,915 Southern California
Public Power Authority,
(MBIA), 5.00%, 1/1/20 6,245,697
------------
$ 20,739,082
------------
INSURED WATER & SEWER - 3.4%
Aaa AAA $ 5,000 East Bay Municipal
Utility District,
(MBIA), Variable, 6/1/08
(1) $ 4,799,850
Aaa AAA 5,000 San Diego Public Finance
Authority, (FGIC) 5.00%,
5/15/25 4,502,100
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
Aaa AAA 3,000 San Diego County Water
Authority, (FGIC),
Variable, 4/22/09 (1) 3,119,850
------------
$ 12,421,800
------------
LEASE/CERTIFICATE OF
PARTICIPATION - 21.8%
A1 A- $ 8,000 California Public Works,
University of
California, 5.50%,
6/1/14 $ 7,736,240
A1 A- 6,500 California Public Works,
University of
California, 5.00%,
6/1/23 5,671,185
A1 A- 3,000 California Public Works,
University of
California, 5.50%,
6/1/10 2,977,560
A A- 3,500 California Public Works,
Susanville Prison,
5.375%, 6/1/18 3,236,415
A A- 2,800 California Public Works,
State Prison System,
5.375%, 6/1/12 2,634,464
A1 A- 5,000 California Public Works,
University of
California, 5.25%,
6/1/20 4,587,850
A1 A- 14,025 California Public Works,
University of
California, 5.50%,
6/1/19 13,144,651
Aaa AAA 6,850 California Statewide
Public Works, J. Paul
Getty Trust, 5.00%,
10/1/23 6,115,543
A BBB 2,750 City of Inglewood, Civic
Center Improvement,
7.00%, 8/1/19 2,862,860
Baa1 BBB 3,100 County of Los Angeles,
Disney Parking Project,
0%, 3/1/20 649,295
Baa1 BBB 5,115 County of Los Angeles,
Disney Parking Project,
0%, 3/1/16 1,412,558
Baa1 BBB 1,925 County of Los Angeles,
Disney Parking Project,
0%, 3/1/17 492,627
Baa1 BBB 5,000 County of Los Angeles,
Disney Parking Project,
0%, 9/1/17 1,237,550
Baa1 BBB 5,370 County of Los Angeles,
Disney Parking Project,
0%, 3/1/18 1,285,471
Baa1 BBB 6,925 County of Los Angeles,
Disney Parking Project,
0%, 9/1/20 1,402,867
</TABLE>
31
<PAGE> 32
CALIFORNIA MUNICIPALS PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
LEASE/CERTIFICATE OF
PARTICIPATION - (CONTINUED)
Baa1 BBB 1,000 County of Los Angeles,
Disney Parking Project,
6.50%, 3/1/23 1,010,230
NR NR 7,000 County of Los Angeles,
Marina Del Rey, 6.50%,
7/1/08 7,054,740
A1 A+ 5,000 Pasadena Parking
Facility Project, 6.25%,
1/1/18 5,228,400
Aa A+ 4,000 City of Sacramento
Financing Authority,
5.40%, 11/1/20 3,793,560
A A 3,000 San Bernadino Joint
Power Financing
Authority, 5.50%,
12/1/20 2,846,250
Aa AA 4,425 Orange County Water
District, 5.00%, 8/15/18 3,879,883
------------
$ 79,260,199
------------
NURSING HOME - 0.9%
NR NR $ 3,170 City of Banning, San
Gorgonio Pass
Convalescent, (AMT),
9.50%, 12/1/11 $ 3,269,538
------------
SOLID WASTE - 0.4%
Aaa AAA $ 1,500 Inland Empire Solid
Waste Finance Authority
(FSA) 6.25%, 8/1/11 $ 1,562,265
------------
SPECIAL TAX - 12.8%
NR NR $ 3,000 Lincoln Unified School
District, 7.625%, 9/1/21 $ 3,449,850
NR NR 3,000 Riverside County
Community Facilities
District, 7.55%, 9/1/17 3,046,080
NR NR 910 City of Fairfield, North
Cordelia District,
8.00%, 9/2/11 938,492
NR NR 2,060 City of Fairfield, North
Cordelia District,
7.375%, 9/2/18 2,106,123
NR NR 2,915 City of Commerce, Joint
Power Financing
Authority, 8.00%, 3/1/22 3,061,683
NR BBB 5,000 Contra Costa County,
Public Financing
Authority, 7.10%, 8/1/22 5,212,250
NR BBB 3,910 City of Fontana, Public
Financing Authority,
7.00%, 9/1/21 3,986,675
NR BBB 8,220 Fontana Redevelopment
Agency, Jurupa Hills,
7.00%, 10/1/14 8,431,912
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
NR BBB 2,500 City of Pittsburg
Redevelopment Agency,
7.40%, 8/15/20 2,624,650
NR BBB 600 City of Rancho Mirage,
Joint Power Financing
Authority, 7.50%, 4/1/17 634,704
NR BBB 2,500 Riverside County
Redevelopment Agency,
7.50%, 10/1/26 2,632,975
NR BBB 5,605 San Carlos Redevelopment
Agency, 7.10%, 9/1/17 5,828,247
NR NR 1,400 City of Simi Valley
Community Development,
Sycamore Plaza II,
8.20%, 9/1/12 1,405,670
Baa BBB+ 3,000 Westminster
Redevelopment Agency,
Community Redevelopment
Project, 7.30%, 8/1/21 3,237,570
------------
$ 46,596,881
------------
TRANSPORTATION - 6.8%
NR BBB $ 3,050 Guam Airport Authority,
(AMT), 6.70%, 10/1/23 $ 3,105,571
Aa AA- 2,000 City of Long Beach
Harbor Revenue Bonds,
(AMT), 7.25%, 5/15/19 2,109,980
A1 A- 1,400 County of Orange,
California Airport
Revenue Bonds, 8.125%,
7/1/16 1,448,244
NR NR 12,000 San Joaquin Hills
Transportation Corridor
Agency, Toll Road
Revenue Bonds, 0%,
1/1/14 3,916,200
NR NR 5,765 San Joaquin Hills
Transportation Corridor
Agency, Toll Road
Revenue Bonds, 0%,
1/1/26 853,393
NR NR 35,975 San Joaquin Hills
Transportation Corridor
Agency, Toll Road
Revenue Bonds, 0%,
1/1/27 4,988,653
NR NR 4,940 San Joaquin Hills
Transportation Corridor
Agency, Toll Road
Revenue Bonds, 7.00%,
1/1/30 5,168,722
Baa1 BBB 1,500 Stockton Port District,
7.95%, 1/1/05 1,567,755
Baa1 BBB 1,500 Stockton Port District,
8.10%, 1/1/14 1,579,334
------------
$ 24,737,852
------------
</TABLE>
32
<PAGE> 33
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
UTILITIES - 1.8%
A2 A $ 4,100 California PCR Finance
Authority, San Diego Gas
and Electric, 5.90%,
6/1/14 $ 4,222,467
Aa A+ 7,070 Southern California
Public Power Authority,
0%, 7/1/15 2,296,409
------------
$ 6,518,876
------------
TOTAL TAX-EXEMPT
INVESTMENTS (IDENTIFIED
COST, $337,396,359) $ 363,393,641
============
</TABLE>
(1) Security has been issued as an inverse floater bond.
(2) Security has been segregated to cover margin requirements on open financial
futures contracts.
AMT - Interest earned from these securities may be considered a tax preference
item for purposes of the Federal Alternative Minimum Tax.
The Portfolio primarily invests in debt securities issued by California
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at September 30, 1996, 31.2% of the securities in the portfolio of
investments are backed by bond insurance of financial institutions and financial
guaranty assurance agencies. The aggregate percentage insured by financial
institution ranged from 0.4% to 10.3% of total investments.
See notes to financial statements
33
<PAGE> 34
Florida Municipals Portfolio
Portfolio of Investments - September 30, 1996
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS - 100%
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
ASSISTED LIVING - 0.6%
NR NR $ 3,445 North Miami Florida
Health Care
Facilities-The Imperial
Club Project 9.25%,
1/1/13
$ 3,750,020
-------------
COGENERATION - 3.2%
Baa3 BBB- $ 7,275 Martin County, Indian
Town Project, (AMT),
7.875%, 12/15/25 $ 8,241,993
NR NR 3,100 Palm Beach County,
Okeelanta Power L.P.
Project (AMT), 6.85%,
2/15/21 2,749,948
NR NR 9,250 Palm Beach County,
Osceola Power L.P.
Project (AMT), 6.95%,
1/1/22 8,247,485
-------------
$ 19,239,426
-------------
EDUCATION - 1.0%
NR AAA $ 5,500 Volusia County
Educational Facilities,
Embry-Riddle
Aeronautical University
Project (CLEE), 6.625%,
4/15/22 $ 5,875,210
-------------
ESCROWED - 7.4%
Aaa AAA $ 9,225 Dade County, Baptist
Hospital of Miami
Project, 5.75%, 5/1/21 $ 9,285,055
Aaa AAA 5,000 Florida Municipal Power
Agency Stanton II
Project (AMBAC),
Variable, 10/1/20 (1) 6,048,900
NR NR 1,675 Mid-Bay Bridge
Authority, 6.875%,
10/1/22 1,902,901
A A 7,255 Hillsborough FL Capital
Improvement-Museum of
Science, 6.45%, 1/1/22 7,779,754
Aaa AAA 2,000 Orlando & Orange County
Expressway Authority
(FGIC), 8.25%, 7/1/14 2,623,300
Aaa AAA 5,600 St. Lucie FL Utility
System, 6.00%, 10/1/20 5,818,176
A NR 9,810 City of Venice Health
Facilities, 5.75%,
12/1/24 10,428,422
-------------
$ 43,886,508
-------------
GENERAL OBLIGATION - 10.0%
Aa AA $22,000 Florida Board of
Education, 4.75%, 6/1/22 $ 18,986,220
Aa AA 15,235 Florida Board of
Education, 5.00%, 6/1/20 13,894,471
Aa AA 8,000 Florida Board of General
Services, 6.60%, 7/1/17 8,679,200
NR BBB 5,700 Guam Government, 5.40%,
11/15/18 5,167,335
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
Baa1 A 3,000 Puerto Rico, 6.50%,
7/1/23 3,202,650
Baa1 A 3,235 Puerto Rico Public
Building Authority,
5.50%, 7/1/21 3,059,340
Baa1 A 7,350 Puerto Rico Public
Building Authority,
5.70%, 7/1/09 7,369,037
-------------
$ 60,358,253
-------------
HOSPITAL REVENUE - 3.1%
NR BBB+ $ 3,600 Escambia County Health
Facilities Authority,
Baptist Hospital, Inc.
and The Baptist Manor,
Inc., 6.75%, 10/1/14 $ 3,702,456
NR BBB+ 9,995 Escambia County Health
Facilities Authority,
Baptist Hospital, Inc.,
6.00%, 10/1/14 9,550,722
NR AA+ 4,750 Jacksonville Health
Facilities Finance
Authority, St. Luke's
Hospital Association
Project, 6.75%, 11/15/13 5,085,445
-------------
$ 18,338,623
-------------
HOUSING - 13.6%
NR AAA $ 630 Broward County HFA SFMR
(GNMA), (AMT), 7.35%,
3/1/23 $ 652,327
NR AAA 1,300 Clay County HFA MFMR
(GNMA), 7.40%, 12/1/25 1,373,021
Aaa NR 2,750 Clay County HFA SFMR
(GNMA), (AMT), 6.55%,
3/1/28 2,770,405
Aaa NR 290 Dade County HFA SFMR
(GNMA), 7.10%, 3/1/17 301,678
Aaa NR 1,090 Dade County HFA SFMR
(AMT), 7.75%, 9/1/22 1,142,843
Aaa NR 1,160 Dade County HFA SFMR
(GNMA), (AMT), 7.25%,
9/1/23 1,213,569
Aaa NR 75 Dade County HFA SFMR
(GNMA), 7.00%, 3/1/24 77,888
NR AAA 5,100 Dade County HFA SFMR
(GNMA), (AMT) 6.55%,
10/1/27 5,185,017
NR AAA 5,850 Dade County HFA SFMR
(GNMA), (AMT) 6.70%,
4/1/28 6,041,237
Aaa NR 2,540 Escambia County HFA SFMR
(GNMA), (AMT), 7.40%,
10/1/23 2,636,418
Aaa AAA 7,500 Escambia County HFA SFMR
(GNMA), (AMT), 6.85%,
10/1/17 7,589,400
Aaa AAA 5,000 Escambia County HFA SFMR
(GNMA), (AMT), 6.90%,
10/1/21 5,059,450
</TABLE>
34
<PAGE> 35
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
HOUSING - (CONTINUED)
Aaa AAA 6,250 Escambia County HFA SFMR
(GNMA), (AMT), 6.95%,
10/1/27 6,324,125
Aaa AAA 9,245 Escambia County HFA SFMR
(GNMA), (AMT), 6.20%,
4/1/22 9,301,579
NR AAA 1,125 Florida HFA (FHA),
6.35%, 6/1/14 1,169,651
Aa AA 2,500 Florida HFA (AMT),
6.35%, 7/1/28 2,546,575
Aaa NR 910 Hillsborough County HFA
SFMR (GNMA), (AMT),
7.875%, 5/1/23 965,301
NR AAA 1,695 Orange County HFA SFMR
(GNMA), (AMT), 7.375%,
9/1/24 1,780,987
Aaa NR 12,000 Orange County HFA SFMR
(GNMA), (AMT), 6.85%,
10/1/27 12,483,840
NR AAA 8,000 Orange County HFA SFMR
(GNMA), (AMT), 6.60%,
4/1/28 8,200,720
Aaa NR 845 Palm Beach County HFA
SFMR (GNMA), 7.60%,
3/1/23 887,394
Aaa NR 1,455 Polk County HFA SFMR
(GNMA), 7.15%, 9/1/23 1,524,753
Baa BBB 1,400 Puerto Rico Urban
Renewal & Housing Corp,
7.875%, 10/1/04 1,538,908
Aaa AAA 770 Puerto Rico Housing
Finance Corp SFMR
(GNMA), 7.65%, 10/15/22 810,372
-------------
$ 81,577,458
-------------
INDUSTRIAL
DEVELOPMENT/POLLUTION
CONTROL REVENUE - 1.9%
Baa1 NR $ 2,000 Escambia County Champion
International (AMT),
6.40%, 9/1/30 $ 2,011,440
NR NR 6,000 NJ EDA-Holt Hauling
Project (AMT), 9.75%,
12/15/16 6,174,720
Baa1 BBB+ 3,000 Puerto Rico Port
Authority Revenue,
6.25%, 6/1/26 3,034,350
-------------
$ 11,220,510
-------------
INSURED HEALTHCARE -
0.1%
Aaa AAA $ 500 Alachua County Health
Facility, Mental Health
Services Project (CGIC),
7.75%, 7/1/10 $ 557,225
-------------
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED HOSPITAL - 6.8%
Aaa AAA $ 8,000 Charlotte County Health
Care, Bon-Secours Health
System Project (FSA),
Variable, 8/30/27 (1) $ 8,138,080
Aaa AAA 23,355 Jacksonville, Health
Authority, Daughters of
Charity (MBIA), 5.00%,
11/15/15 21,464,647
Aaa AAA 2,000 Lee County, Memorial
Hospital (MBIA),
Variable, 4/1/20 (1) 2,228,860
Aaa AAA 5,265 Orange County Health
Facilities Finance
Authority, Pooled
Hospital Loan
Program-Orlando Regional
Medical Center & Indian
River Memorial Hospital
(FGIC), 7.875%, 12/1/25 5,496,449
Aaa AAA 3,000 Orange County Health
Facilities Authority
(MBIA), Variable,
10/1/21 (1) 3,320,370
-------------
$ 40,648,406
-------------
INSURED HOUSING - 2.7%
Aaa AAA $ 1,205 Brevard County HFA SFMR
(FSA), 7.00%, 3/1/13 $ 1,266,708
Aaa AAA 1,720 Duval County HFA SFMR
(FGIC), 7.35%, 7/1/24 1,843,771
Aaa AAA 6,530 Florida HEFA, Maitland
Club Apartment Project
(AMBAC) (AMT), 6.875%,
8/1/26 6,806,088
Aaa AAA 3,000 Florida HFA, Brittany of
Rosemont Project (AMBAC)
(AMT), 6.875%, 8/1/26 3,115,290
Aaa AAA 2,675 Lee County SCA MFMR
(FSA) (AMT), 7.05%,
1/1/30 2,797,676
-------------
$ 15,829,533
-------------
INSURED IDR/PCR - 1.5%
Aaa AAA $ 8,200 Citrus County PCR
(MBIA), 6.35%, 2/1/22 $ 8,616,396
-------------
INSURED MISCELLANEOUS - 0.5%
Aaa AAA $ 2,000 Escambia County (MBIA),
7.20%, 1/1/15 $ 2,134,080
Aaa AAA 799 Osceola County IDA
Community Provider
Pooled Loan Program,
(CGIC), 7.75%, 7/1/10 846,093
-------------
$ 2,980,173
-------------
</TABLE>
35
<PAGE> 36
FLORIDA MUNICIPALS PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
INSURED SOLID WASTE - 0.3%
<S> <C> <C> <C> <C>
Aaa AAA $ 1,500 St. John's County Solid
Waste Disposal (FGIC),
7.25%, 11/1/10 $ 1,664,595
-------------
INSURED SPECIAL TAX
REVENUE - 2.8%
Aaa AAA $ 3,835 Dade, Professional
Sports Franchise (MBIA),
0%, 10/1/23 $ 804,430
Aaa AAA 2,250 Dade, Convention Center
(AMBAC), 5.00%, 10/1/35 2,004,548
Aaa AAA 1,000 City of Jacksonville
(FGIC) (AMT), 0%,
10/1/10 448,650
Aaa AAA 1,000 City of Jacksonville
(FGIC) (AMT), 0%,
10/1/11 420,610
Aaa AAA 2,000 City of Jacksonville
(FGIC) (AMT), 0%,
10/1/12 787,860
Aaa AAA 1,185 City of Opa-Locka
(FGIC), 7.0%, 1/1/14 1,338,588
Aaa AAA 5,000 St. Petersburg Excise
Tax (FGIC), 5.00%,
10/1/16 4,579,950
Aaa AAA 2,000 Sunrise Florida Public
Facilities (MBIA), 0%,
10/1/10 915,800
Aaa AAA 1,760 Sunrise Florida Public
Facilities (MBIA), 0%,
10/1/12 709,667
Aaa AAA 2,840 Sunrise Florida Public
Facilities (MBIA), 0%,
10/1/14 1,022,201
Aaa AAA 4,000 Sunrise Florida Public
Facilities (MBIA), 0%,
10/1/15 1,347,720
Aaa AAA 4,140 Sunrise Florida Public
Facilities (MBIA), 0%,
10/1/16 1,317,264
Aaa AAA 2,525 Sunrise Florida Public
Facilities (MBIA), 0%,
10/1/17 758,687
-------------
$ 16,455,975
-------------
INSURED TRANSPORTATION - 6.7%
Aaa AAA $ 4,000 Dade County Aviation
Facilities (MBIA) (AMT),
6.55%, 10/1/13 $ 4,288,880
Aaa AAA 2,150 Dade County Aviation
Facilities (MBIA) (AMT),
6.60%, 10/1/23 2,298,157
Aaa AAA 5,775 Dade County Aviation
Facilities (MBIA) (AMT),
6.00%, 10/1/24 5,853,829
Aaa AAA 8,455 Florida State Turnpike
Authority (FGIC), 6.35%,
7/1/22 8,835,136
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
Aaa AAA 8,600 Greater Orlando Aviation
Authority, Orlando
Airport Facilities
(FGIC), (AMT), 6.375%,
10/1/21 (2) 8,979,690
Aaa AAA 10,170 Orlando & Orange County
Expressway Authority
(FGIC), 5.125%, 7/1/20 9,413,250
-------------
$ 39,668,942
-------------
INSURED UTILITIES - 3.8%
Aaa AAA $ 8,000 Florida Municipal Power
Agency Stanton II
Project (AMBAC), 4.50%,
10/1/27 $ 6,453,200
Aaa AAA 7,770 Florida Municipal Power
Agency Stanton II
Project (AMBAC), 4.50%,
10/1/16 6,649,333
Aaa AAA 4,000 Lakeland Electric &
Water (FGIC), 6.00%,
10/1/13 4,264,720
Aaa AAA 1,540 Manatee County Public
Utility (FGIC), 0%,
10/1/12 617,109
Aaa AAA 2,150 Puerto Rico Electric
Power Authority (FSA),
Variable, 7/1/02 (1) 2,308,605
Aaa AAA 2,200 Puerto Rico Electric
Power Authority (FSA),
Variable, 7/1/03 (1) 2,385,790
-------------
$ 22,678,757
-------------
INSURED WATER & SEWER - 4.2%
Aaa AAA $11,450 Broward County Water &
Sewer (AMBAC), 5.125%,
10/1/15 $ 10,729,910
Aaa AAA 9,500 Dade County Water and
Sewer System (FGIC),
5.00%, 10/1/13 8,909,955
Aaa AAA 2,000 City of Fort Myers
Utility (FGIC), 5.00%,
10/1/16 1,845,420
Aaa AAA 4,000 Sanford Water and Sewer
(AMBAC), 4.50%, 10/1/21 3,350,520
-------------
$ 24,835,805
-------------
LIFE CARE - 1.2%
NR NR $ 6,895 Atlantic Beach, Fleet
Landing Project, 8.00%,
10/1/24 $ 7,144,737
-------------
NURSING HOMES - 4.3%
NR NR $ 300 Broward County
Industrial Development
Authority, Beverly
Enterprises-Florida,
Inc. Project, 9.80%,
11/1/10 $ 332,166
NR NR 450 Charlotte County
Industrial Development
Authority, Beverly
Enterprises, 10.00%,
6/1/11 507,812
</TABLE>
36
<PAGE> 37
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
NURSING HOMES - (CONTINUED)
NR NR 6,520 Citrus County Industrial
Development Authority,
Beverly Enterprises,
7.25%, 4/1/03 6,597,784
NR AAA 4,285 Dade, IDA-Club Care
Center Project (GNMA)
6.60%, 1/20/18 4,399,410
NR AAA 5,075 Dade, IDA-Gramercy Park
Nursing Care Project
(FHA) 6.60%, 8/1/23 5,315,352
NR NR 2,045 Highlands County
Industrial Development
Authority, Beverly
Enterprises-Florida,
Inc. Project, 9.25%,
7/1/07 2,250,073
Baa1 NR 3,750 Jacksonville,
Health-Cypress Village
Project, 7.00%, 12/01/22 3,900,525
NR NR 410 Okaloosa County, Beverly
Enterprises, 10.75%,
10/1/03 436,087
NR NR 680 Orange County Industrial
Development Authority,
Beverly Enterprises,
9.25%, 8/1/10 749,496
NR NR 1,000 Winter Garden, Beverly
Enterprises, 8.75%,
7/1/12 1,089,190
-------------
$ 25,577,895
-------------
POOLED LOANS - 0.9%
NR NR $ 5,000 Osceola County, IDA
Community Pooled Loan,
7.75%, 7/1/17 $ 5,052,700
-------------
SOLID WASTE - 0.7%
A A $ 3,745 Broward County Waste
Energy Company, L.P.
North Project, 7.95%,
12/1/08 $ 4,125,155
-------------
SPECIAL TAX REVENUE - 7.7%
A1 A+ $ 8,020 Orange County 5.375%,
1/1/24 $ 7,462,129
A1 NR 3,000 City of Orlando, 6.00%,
10/1/22 3,047,850
Baa1 A 7,410 Puerto Rico Highway &
Transportation
Authority, 5.50%, 7/1/19 7,085,368
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
Baa1 A 10,135 Puerto Rico Highway &
Transportation
Authority, 5.00%, 7/1/22 8,995,117
Baa1 A 10,560 Puerto Rico Highway &
Transportation
Authority, 5.25%, 7/1/21 9,735,897
Baa1 A 4,750 Puerto Rico Highway &
Transportation
Authority, 5.00%, 7/1/36 4,148,745
Baa1 A 5,750 Puerto Rico Highway &
Transportation
Authority, 5.50%, 7/1/36 5,465,605
-------------
$ 45,940,711
-------------
TRANSPORTATION - 1.7%
NR NR $10,140 Mid-Bay Bridge
Authority, 6.125%,
10/1/22 $ 10,157,238
-------------
UTILITIES - 12.9%
Aa AA $ 7,125 Gainesville Utility
System, 5.20%, 10/1/22 $ 6,718,519
NR BBB 27,825 Guam Power Authority,
5.25%, 10/1/23 24,283,156
Aa1 AA 34,005 Jacksonville Electric
Authority, Bulk Power
Supply System, Scherer 4
Project, 5.25%, 10/1/21 31,892,948
Aa1 AA 2,850 Orlando Utilities
Commission Water and
Electric, 5.125%,
10/1/19 2,627,729
Aa AA- 1,750 Orlando Utilities
Commission Water and
Electric, 5.25%, 10/1/23 1,623,983
Aa AA- 2,965 Orlando Utilities
Commission Water and
Electric, 5.50%, 10/1/26 2,847,349
Baa1 BBB+ 6,000 Puerto Rico Electric
Power Authority, 0%,
7/1/17 1,749,540
Baa1 BBB+ 185 Puerto Rico Electric
Power Authority, 7.125%,
7/1/14 198,205
A1 AA 2,515 St. Lucie County Solid
Waste Disposal, Florida
Power & Light Company
(AMT), 6.70%, 5/1/27 2,644,196
NR NR 2,000 Virgin Islands Water &
Power Authority, 7.40%,
7/1/11 2,117,680
-------------
$ 76,703,305
-------------
</TABLE>
37
<PAGE> 38
FLORIDA MUNICIPALS PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
UTILITIES - (Continued)
WATER & SEWER - 0.4%
<S> <C> <C> <C> <C>
Baa1 BBB+ $ 2,500 Hillsborough County
Utility, 6.625%, 8/1/11 $ 2,636,250
-------------
TOTAL TAX-EXEMPT
INVESTMENTS (IDENTIFIED
COST, $560,837,654) $ 595,519,806
=============
</TABLE>
(1) Security has been issued as an inverse floater bond.
(2) Security has been segregated to cover margin requirements on open financial
futures contracts.
AMT - Interest earned from these securities may be considered a tax preference
item for purposes of the Federal Alternative Minimum Tax.
The Portfolio invests primarily in debt securities issued by Florida
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at September 30, 1996, 43.9% of the securities in the portfolio of
investments are backed by bond insurance of various financial institutions and
financial guaranty assurance agencies. The aggregate percentage insured by
financial institution ranged from 0.2% to 13.4% of total investments.
See notes to financial statements
38
<PAGE> 39
Massachusetts Municipals Portfolio
Portfolio of Investments - September 30, 1996
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS - 100%
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
EDUCATION - 3.6%
Aa1 AA+ $ 1,625 Massachusetts Health and
Educational Facilities
Authority, HEFA, Amherst
College, 6.80%, 11/1/21 $ 1,757,096
A1 A+ 250 Massachusetts HEFA,
Tufts University, 7.75%,
8/1/13 269,148
NR BBB- 3,690 Massachusetts HEFA,
Merrimack College,
7.125%, 7/1/12 3,808,656
Aa1 AA 1,000 Massachusetts HEFA,
Williams College, 5.75%,
7/1/19 1,010,110
Aa1 AA+ 1,000 Massachusetts HEFA,
Wellesley College,
5.375%, 7/1/19 953,870
A1 NR 2,000 New England Educational
Loan Marketing
Corporation, (AMT),
6.90%, 11/1/09 2,137,020
-------------
$ 9,935,900
-------------
ESCROWED - 1.4%
NR AAA $10,000 Massachusetts General
Obligation Federal
Assisted Housing,
Section 8, 0%, 2/1/23 $ 1,786,500
Baa1 AAA 1,900 Puerto Rico Aqueduct and
Sewer Authority,
Prerefunded to 7/1/98,
7.00%, 7/1/19 2,030,416
-------------
$ 3,816,916
-------------
GENERAL OBLIGATIONS - 6.4%
Baa1 NR $ 1,000 City of Lowell, 6.375%,
8/15/01 $ 1,060,880
A1 A+ 3,400 Commonwealth of
Massachusetts, 5.00%,
1/1/12 3,152,854
A1 A+ 4,265 Massachusetts Bay
Transportation Authority
(MBTA), 5.50%, 3/1/21 4,045,523
A1 A+ 1,000 MBTA, 5.90%, 3/1/12 1,020,180
NR BBB 2,145 Government of Guam,
5.40%, 11/15/18 1,944,550
A NR 3,375 Town of Nantucket,
6.80%, 12/1/11 3,693,870
Baa1 A 100 Puerto Rico Public
Buildings Authority,
5.50%, 7/1/21 94,570
A1 A+ 250 University of
Massachusetts Building
Authority, 7.20%, 5/1/04 282,750
NR NR 2,350 Virgin Islands Public
Finance Authority,
7.25%, 10/1/18 2,500,635
-------------
$ 17,795,812
-------------
HEALTH CARE - 1.3%
NR AA $ 1,485 Massachusetts HEFA,
(FHA), Deutsches
Altenheim, 7.70%,
11/1/31 $ 1,592,217
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
NR AAA 2,100 Massachusetts Industrial
Finance Agency, IFA,
Heights Crossing, (AMT),
6.15%, 2/1/35 2,101,470
-------------
$ 3,693,687
-------------
HOSPITALS - 11.8%
A A $ 3,000 Massachusetts HEFA,
Charlton Memorial
Hospital, 7.25%, 7/1/13 $ 3,187,530
A1 A+ 530 Massachusetts HEFA,
Spaulding Rehabilitation
Hospital, 7.625%, 7/1/21 560,157
Baa1 BBB+ 2,000 Massachusetts HEFA, New
England Baptist
Hospital, 7.35%, 7/1/17 2,118,720
Aa NR 3,100 Massachusetts HEFA,
Daughters of Charity
Health System, 6.10%,
7/1/14 3,161,194
Baa BBB 5,025 Massachusetts HEFA,
Sisters of Providence
Health System, 6.50%,
11/15/08 5,030,779
Baa BBB 2,085 Massachusetts HEFA,
Sisters of Providence
Health System, 6.625%,
11/15/22 2,070,697
NR A- 1,020 Massachusetts HEFA,
Jordan Hospital, 6.875%,
10/1/15 1,059,627
NR A- 2,870 Massachusetts HEFA,
Jordan Hospital, 6.875%,
10/1/22 2,981,500
Baa BB 5,500 Massachusetts HEFA,
Milford-Whitinsville
Hospital, 7.75%, 7/15/17 5,730,010
NR BBB- 2,600 Massachusetts HEFA,
North Adams Hospital,
6.625%, 7/1/18 2,557,022
NR NR 9,000 Massachusetts IFA,
Biomedical Research
Corporation, 0%, 8/1/09 4,051,349
-------------
$ 32,508,585
-------------
HOUSING - 14.3%
NR AAA $ 2,750 Framingham Housing
Authority, (GNMA),
6.65%, 2/20/32 $ 2,802,800
A1 A+ 5,855 Massachusetts Housing
Finance Agency, HFA,
6.375%, 4/1/21 5,894,931
Aa A+ 400 Massachusetts HFA,
7.35%, 12/1/16 422,956
Aaa AAA 2,750 Massachusetts HFA,
(FNMA), 6.90%, 11/15/21 2,918,245
Aaa AAA 1,000 Massachusetts HFA,
(FNMA), 6.875%, 11/15/11 1,073,290
</TABLE>
39
<PAGE> 40
MASSACHUSETTS MUNICIPALS PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
HOUSING - (CONTINUED)
Aa A+ 2,795 Massachusetts HFA,
(AMT), 7.125%, 6/1/25 2,924,464
Aa A+ 1,500 Massachusetts HFA,
(AMT), 8.10%, 12/1/21 1,588,230
Aa A+ 2,195 Massachusetts HFA,
(AMT), 8.10%, 6/1/20 2,305,276
Aa A+ 7,250 Massachusetts HFA,
(AMT), 6.60%, 12/1/26 7,437,919
Aa A+ 6,400 Massachusetts HFA,
(AMT), 6.60%, 12/1/26 6,565,888
Aa A+ 5,500 Massachusetts HFA,
(AMT), 6.60%, 12/1/24 5,647,565
-------------
$ 39,581,564
-------------
INDUSTRIAL DEVELOPMENT/
POLLUTION CONTROL - 4.2%
NR NR $ 2,075 Massachusetts IFA,
Hingham Water Company,
(AMT), 6.60%, 12/1/15 $ 2,124,115
NR NR 3,000 Massachusetts IFA,
Hingham Water Company,
(AMT), 6.90%, 12/1/29 3,081,840
A1 AA- 1,550 Puerto Rico Industrial,
Medical and
Environmental Pollution
Control Authority, The
Upjohn Company, 7.50%,
12/1/23 1,688,524
Baa3 BB+ 1,000 Puerto Rico Port
Authority, American
Airlines, (AMT), 6.30%,
6/1/23 1,012,520
Baa3 BB+ 3,750 Puerto Rico Port
Authority, American
Airlines, (AMT), 6.25%,
6/1/26 3,792,938
-------------
$ 11,699,937
-------------
INSURED EDUCATION - 4.0%
Aaa AAA $ 315 Massachusetts
Educational Finance
Authority, (MBIA),
(AMT), 7.25%, 1/1/09 $ 332,360
Aaa AAA 2,000 Massachusetts
Educational Finance
Authority, (AMBAC),
(AMT), 7.375%, 1/1/12 2,121,840
Aaa AAA 250 Massachusetts HEFA,
Northeastern University,
(AMBAC), 7.50%, 10/1/08 268,828
Aaa AAA 400 Massachusetts HEFA,
Boston University
"RIBS", (MBIA),
Variable, 10/1/31 (1) 452,008
Aaa AAA 3,000 Massachusetts HEFA,
Tufts University,
(FGIC), 5.95%, 8/15/18 3,035,400
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
NR AAA 5,170 Massachusetts HEFA,
Wentworth Institute,
(CLEE), 5.50%, 10/1/23 4,806,963
-------------
$ 11,017,399
-------------
INSURED GENERAL OBLIGATIONS - 1.2%
Aaa AAA $ 1,795 City of Boston, (FSA),
4.875%, 9/1/09 $ 1,689,005
Aaa AAA 1,000 Commonwealth of Puerto
Rico "RIBS", (AMBAC),
Variable, 7/1/15 (1) 1,016,500
Aaa AAA 600 Town of Tyngsborough,
(AMBAC), 6.90%, 5/15/08 672,702
-------------
$ 3,378,207
-------------
INSURED HOSPITALS - 12.9%
Aaa AAA $ 750 Massachusetts HEFA,
Addison Gilbert
Hospital, (MBIA), 5.75%,
7/1/23 $ 730,943
Aaa AAA 300 Massachusetts HEFA,
Berkshire Health
Systems, (MBIA), 7.60%,
10/1/14 325,143
Aaa AAA 3,750 Massachusetts HEFA, Beth
Israel Hospital,
(AMBAC), Variable,
7/1/25 (1) 3,788,438
Aaa AAA 1,500 Massachusetts HEFA,
Capital Assist Program,
(MBIA), 7.20%, 7/1/09 1,623,780
Aaa AAA 2,050 Massachusetts HEFA,
Fallon Healthcare
System, (FSA), 6.75%,
6/1/20 (2) 2,259,654
Aaa AAA 2,500 Massachusetts HEFA,
Fallon Healthcare System
(FSA), 6.875%, 6/1/11 2,784,225
Aaa AAA 2,040 Massachusetts HEFA,
Beverly Hospital,
(MBIA), 7.30%, 7/1/13 2,208,565
Aaa AAA 500 Massachusetts HEFA,
Baystate Medical Center,
(FGIC), 5.00%, 7/1/20 448,730
Aaa AAA 3,000 Massachusetts HEFA, The
Medical Center of
Central Massachusetts,
(AMBAC), "CARS",
Variable, 6/23/22 (1) 3,363,270
Aaa AAA 2,000 Massachusetts HEFA, St.
Elizabeth Hospital
Issue, "LEVRRS", (FSA),
Variable, 8/15/21 (1) 2,274,120
Aaa AAA 2,600 Massachusetts HEFA,
Saint Luke's Hospital,
"Yield Curve Notes",
(MBIA), Variable,
8/15/23 (1) 2,542,150
</TABLE>
40
<PAGE> 41
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED HOSPITALS - (CONTINUED)
Aaa AAA 2,600 Massachusetts HEFA,
Saint Luke's Hospital,
"Yield Curve Notes",
(MBIA), Variable,
8/15/13 (1) 2,560,194
Aaa AAA 1,200 Massachusetts HEFA,
University Hospital,
(MBIA), 7.25%, 7/1/19 1,314,864
Aaa AAA 2,430 Massachusetts HEFA,
Lahey Clinic, (MBIA),
5.375%, 7/1/23 2,259,171
Aaa AAA 1,000 Massachusetts HEFA, New
England Medical Center,
(FGIC), 6.50%, 7/1/12 1,051,970
NR AAA 2,625 Massachusetts HEFA,
Winchester Hospital,
(CLEE), 5.75%, 7/1/14 2,570,453
NR AAA 3,650 Massachusetts HEFA,
Winchester Hospital,
(CLEE), 5.75%, 7/1/24 3,507,978
-------------
$ 35,613,648
-------------
INSURED HOUSING - 2.5%
Aaa AAA $ 2,500 Massachusetts HFA,
(AMT), (AMBAC), 6.40%,
12/1/15 $ 2,526,325
Aaa AAA 2,000 Massachusetts HFA,
(AMBAC), 6.45%, 1/1/36 2,063,880
Aaa AAA 2,225 Massachusetts HFA,
(AMT), (MBIA), 6.375%,
12/1/19 2,238,773
-------------
$ 6,828,978
-------------
INSURED TRANSPORTATION - 2.3%
Aaa AAA $ 5,860 Massachusetts Port
Authority, (AMT),
(FGIC), 7.50%, 7/1/20 $ 6,396,659
-------------
INSURED UTILITY - 2.0%
Aaa AAA $ 5,610 Massachusetts Municipal
Wholesale Electric
Company, (MBIA), 6.00%,
7/1/18 $ 5,655,385
-------------
LEASE/CERTIFICATE OF
PARTICIPATION - 3.5%
NR A- $ 7,800 Plymouth County,
Massachusetts
Correctional Facility
Project, 7.00%, 4/1/22 $ 8,549,346
NR BBB 1,200 Puerto Rico Industrial,
Tourist, Educational,
Medical and
Environmental Control
Authority, Guaynabo
Lease, 5.625%, 7/1/22 1,095,912
-------------
$ 9,645,258
-------------
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
NURSING HOMES - 2.2%
NR NR $ 2,400 Massachusetts HEFA,
Fairview Care
Facilities, 10.25%,
1/1/21 $ 2,717,400
NR NR 3,225 Massachusetts IFA, Age
Institute of
Massachusetts, 8.05%,
11/1/25 3,234,740
-------------
$ 5,952,140
-------------
SOLID WASTE - 0.5%
NR NR $ 1,245 City of Pittsfield,
Vicon Recovery
Associates Project,
7.95%, 11/1/04 $ 1,295,236
-------------
SPECIAL TAX REVENUE - 2.8%
A1 AA $ 3,000 Commonwealth of
Massachusetts, 6.00%,
6/1/13 $ 3,047,070
A1 AA- 4,560 Commonwealth of
Massachusetts, 5.80%,
6/1/14 4,579,654
-------------
$ 7,626,724
-------------
TRANSPORTATION - 8.3%
NR BBB $ 5,950 Guam Airport Authority,
(AMT), 6.70%, 10/1/23 $ 6,058,409
Aa AA- 9,800 Massachusetts Port
Authority, 6.00%, 7/1/23 9,938,572
A1 A+ 7,750 Massachusetts Turnpike
Authority, 5.00%, 1/1/20 6,837,438
-------------
$ 22,834,419
-------------
UTILITIES - 5.7%
NR BBB $ 2,765 Guam Power Authority,
5.25%, 10/1/23 $ 2,413,043
Baa BBB+ 3,500 Massachusetts Municipal
Wholesale Electric
Company, 6.75%, 7/1/11 3,682,385
Baa BBB+ 9,060 Massachusetts Municipal
Wholesale Electric
Company, 6.625%, 7/1/18 9,577,779
Baa1 BBB+ 150 Puerto Rico Electric
Power Authority, 5.50%,
7/1/20 142,739
-------------
$ 15,815,946
-------------
WATER & SEWER - 9.1%
Baa1 BBB $12,185 City of Boston
Massachusetts Harbor
Electric Energy Company
Project, (AMT), 7.375%,
5/15/15 $ 13,112,888
</TABLE>
41
<PAGE> 42
MASSACHUSETTS MUNICIPALS PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
WATER & SEWER - (CONTINUED)
A A 1,500 MWRA, 5.25%, 3/1/13 1,423,980
A A 5,175 MWRA, 5.00%, 3/1/22 4,609,010
A A 4,165 MWRA, 5.25%, 12/1/15 3,957,162
NR NR 2,000 Virgin Islands Water and
Power Authority, 7.60%,
1/1/12 2,150,401
-------------
$ 25,253,441
-------------
TOTAL TAX-EXEMPT
INVESTMENTS (IDENTIFIED
COST, $259,784,548) $ 276,345,841
=============
</TABLE>
(1) Security has been issued as an inverse floater bond.
(2) Security has been segregated to cover margin requirements on open financial
futures contracts.
AMT - Interest earned from these securities may be considered a tax preference
item for purposes of the Federal Alternative Minimum Tax.
The Portfolio invests primarily in debt securities issued by Massachusetts
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at September 30, 1996, 22.6% of the securities in the portfolio of
investments are backed by bond insurance of various financial institutions and
financial guaranty assurance agencies. The aggregate percentage insured by
financial institution ranged from 0.6% to 8.1% of total investments.
See notes to financial statements
42
<PAGE> 43
Mississippi Municipals Portfolio
Portfolio of Investments - September 30, 1996
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS - 100%
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
ESCROWED - 2.0%
Aaa NR $ 1,500 Mississippi Housing
Finance Corporation,
SFMR, (AMT), 0%, 6/1/15 $ 502,230
-----------
EDUCATION - 1.9%
NR A $ 470 University of
Mississippi Educational
Building Athletic
Facility, 6.20%, 6/1/16 $ 478,150
-----------
GENERAL OBLIGATIONS - 4.7%
Aa AA- $ 200 State of Mississippi,
5.10%, 11/15/12 $ 190,686
Aa AA- 500 State of Mississippi,
6.75%, 12/1/14 545,750
Baa1 A 500 Puerto Rico Aquaduct and
Sewer Authority, 5.00%,
7/1/19 451,525
-----------
$ 1,187,961
-----------
HOSPITAL - 3.7%
A NR $ 1,000 Mississippi Hospital
Equipment & Facilities
Authority, Rankin
Medical Center, 5.60%,
3/1/19 $ 931,220
-----------
HOUSING - 10.4%
Aa NR $ 500 Hinds County, Woodridge
Apartments, (FHA) 6.25%,
11/1/27 $ 506,484
Aaa NR 945 Mississippi Home
Corporation, SFMR,
Access Program, (AMT),
(GNMA) 8.125%, 12/1/24 1,044,320
Aaa NR 460 Mississippi Home
Corporation, SFMR,
Access Program, (AMT),
(GNMA) 8.10%, 12/1/24 508,420
Aaa NR 500 Mississippi Home
Corporation, SFMR,
Access Program, (AMT),
(GNMA) 6.00%, 12/1/27 538,280
-----------
$ 2,597,504
-----------
INDUSTRIAL DEVELOPMENT
REVENUE - 12.6%
NR A- $ 400 Jackson County,
International Paper
Company, (AMT), 5.55%,
10/1/17 $ 385,596
A2 A 1,000 Lowndes County,
Weyerhaeuser Company,
6.80%, 4/1/22 1,119,320
NR AA- 500 Mississippi Business
Finance Corp., (AMT),
7.15%, 5/1/16 (2) 545,725
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
Baa3 BB+ 490 Commonwealth of Puerto
Rico, Port American
Airlines, 6.25%, 6/1/26 495,611
A3 A- 600 Warren County,
International Paper
Company, (AMT), 6.60%,
3/1/19 615,846
-----------
$ 3,162,098
-----------
INSURED EDUCATION - 4.2%
Aaa AAA $ 1,000 Mississippi Educational
Facilities Authority,
Milsaps College, (MBIA)
6.50%, 11/1/19 $ 1,063,780
-----------
INSURED GENERAL OBLIGATIONS - 5.7%
Aaa AAA $ 500 Hinds County, (MBIA)
6.25%, 3/1/11 $ 535,405
Aaa AAA 1,000 Desoto County School
District, (MBIA) 4.75%,
2/1/13 892,980
-----------
$ 1,428,385
-----------
INSURED HOSPITALS - 18.2%
Aaa AAA $ 750 Alcorn County, Magnolia
Regional Health Center,
(AMBAC) 5.75%, 10/1/13 $ 753,023
Aaa AAA 1,000 City of Gulfport,
Gulfport Memorial
Hospital, (MBIA) 6.20%,
7/1/18 1,042,950
Aaa AAA 1,275 Hinds County,
Mississippi Methodist
Hospital, (AMBAC) 5.60%,
5/1/12 1,265,769
Aaa AAA 1,000 Mississippi Hospital
Equipment and Facilities
Authority, Mississippi
Baptist Medical Center,
(MBIA) 6.00%, 5/1/13 1,025,920
Aaa AAA 500 Mississippi Development
Bank, Adams County
Hospital, 5.75%, 7/1/16 493,560
-----------
$ 4,581,222
-----------
INSURED HOUSING - 2.1%
Aaa NR $ 500 Mississippi Home
Corporation, SFMR,
(AMT), (GNMA) 6.625%,
4/1/27 $ 516,990
-----------
INSURED LEASE/CERTIFICATE OF
PARTICIPATION - 4.0%
Aaa AAA $ 1,000 Medical Center Building
Corporation, University
of Mississippi Medical
Center, (MBIA) 5.80%,
12/1/14 $ 1,002,190
-----------
</TABLE>
43
<PAGE> 44
MISSISSIPPI MUNICIPALS PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED UTILITIES - 6.5%
Aaa AAA $ 1,250 Jackson County, Gautier
Utility District, (MBIA)
6.375%, 3/1/12 $ 1,310,338
Aaa AAA 300 Puerto Rico, Electric
Power Authority, (FSA),
Variable 7/1/03 (1) 325,335
-----------
$ 1,635,673
-----------
INSURED WATER & SEWER - 2.0%
Aaa AAA $ 500 City of Natchez,
Combined Water and Sewer
System, (MBIA) 5.70%,
8/1/17 $ 495,740
-----------
HEALTH CARE - 2.0%
NR NR $ 300 Mississippi Business
Finance Corporation,
Magnolia Healthcare,
7.99%, 7/1/25 $ 296,610
NR NR 200 City of Ridgeland Urban
Renewal, The Orchard,
LTD., 7.75%, 12/1/15 202,346
-----------
$ 498,956
-----------
LEASE/CERTIFICATE OF
PARTICIPATION - 7.9%
NR A $ 1,000 Mississippi Development
Bank, Golden Triangle
Solid Waste, 6.00%,
7/01/15 $ 981,150
A NR 1,000 Mississippi University
Educational Building
Corp., Facilities
Renovation, 6.15%,
6/15/15 1,014,670
-----------
$ 1,995,820
-----------
SPECIAL TAX - 4.6%
Baa1 A $ 1,000 Puerto Rico, Highway and
Transportation
Authority, 5.25%, 7/1/21 $ 921,960
Baa1 A 250 Puerto Rico, Highway and
Transportation
Authority, 5.50%, 7/1/36 237,633
-----------
$ 1,159,593
-----------
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
UTILITIES - 7.5%
NR BBB $ 810 Guam Power Authority,
6.625%, 10/1/14 $ 839,630
Baa3 NR 1,000 Warren County,
Mississippi Power &
Light Company Project,
7.00%, 4/1/22 1,053,090
-----------
$ 1,892,720
-----------
TOTAL TAX-EXEMPT
INVESTMENTS (IDENTIFIED
COST, $23,820,442) $ 25,130,232
===========
</TABLE>
(1) Security has been issued as an inverse floater bond.
(2) Security has been segregated to cover margin requirements on open financial
futures contracts.
AMT - Interest earned from these securities may be considered a tax preference
item for purposes of the Federal Alternative Minimum Tax.
The Portfolio invests primarily in debt securities issued by Mississippi
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at September 30, 1996, 51.1% of the securities in the portfolio of
investments are backed by bond insurance of various financial institutions and
financial guaranty assurance agencies. The aggregate percentage insured by
financial institution ranged from 1.3% to 29.3% of total investments.
See notes to financial statements
44
<PAGE> 45
New York Municipals Portfolio
Portfolio of Investments - September 30, 1996
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS - 100%
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
ASSISTED LIVING - 0.3%
NR NR $ 1,970 Village of North
Syracuse Housing
Authority, (AJM Senior
Housing, Inc. Janus Park
Project), 8.00%, 6/1/24 $ 1,959,007
------------
EDUCATION - 15.1%
A NR $ 1,000 Dutchess County IDA,
Bard College, 7.00%,
11/1/17 $ 1,084,560
A1 NR 6,170 Monroe County IDA,
Wilmur Assoc., 7.25%,
12/1/16 6,378,855
Baa BBB- 1,660 City of New Rochelle IDA
Civic Facilities,
College of New Rochelle,
6.75%, 7/1/22 1,698,877
Baa1 BBB+ 1,300 Dormitory Authority,
State University
Educational Facilities,
7.50%, 5/15/11 1,518,517
Aaa AA+ 6,895 Dormitory Authority,
State University
Educational Facilities,
4.75%, 7/1/14 6,140,825
Aa AA 2,650 Dormitory Authority,
Vassar College, 5.00%,
7/1/15 2,452,178
Baa1 BBB+ 415 Dormitory Authority,
State University
Educational Facilities,
7.375%, 5/15/14 452,421
Baa1 BBB+ 9,850 Dormitory Authority,
State University
Educational Facilities,
5.25%, 5/15/15 9,089,875
Baa1 BBB+ 24,605 Dormitory Authority,
State University
Educational Facilities,
5.25%, 5/15/19 22,505,701
Baa1 BBB+ 6,805 Dormitory Authority,
State University
Educational Facilities,
5.25%, 5/15/21 6,160,430
NR AA 1,300 Dormitory Authority, New
York Medical College
(Asset Guaranty),
6.875%, 7/1/21 1,402,570
Baa1 BBB+ 32,000 Dormitory Authority,
State University
Educational Facilities,
5.50%, 5/15/13 30,751,680
------------
$ 89,636,489
------------
ELECTRIC UTILITIES -
4.5%
A1 A $ 2,500 New York State Energy
Research & Development
Authority, Brooklyn
Union Gas (RIBS)(AMT),
Variable, 7/1/26 (1) $ 2,952,600
A1 A+ 500 New York State Energy
Research & Development
Authority, Consolidated
Edison (AMT), 7.75%,
1/1/24 524,500
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
A1 A+ 2,365 New York State Energy
Research & Development
Authority, Consolidated
Edison (AMT), 7.50%,
7/1/25 2,537,148
A1 A+ 1,000 New York State Energy
Research & Development
Authority, Consolidated
Edison (AMT), 7.50%,
1/1/26 1,076,510
Aa AA- 17,445 Power Authority of the
State of New York,
5.25%, 1/1/18 16,280,023
NR NR 3,000 Virgin Islands Water and
Power Authority, 7.40%,
7/1/11 3,176,520
------------
$ 26,547,301
------------
ESCROWED - 9.6%
Aaa AAA $ 725 Albany Municipal Water
(MBIA), 7.50%, 12/1/17 $ 787,915
Aaa BBB 1,000 Dormitory Authority,
City University, 7.625%,
7/1/20 1,123,410
Aaa BBB+ 1,530 Dormitory Authority,
State University
Educational Facilities,
7.70%, 5/15/12 1,717,670
Baa1 BBB+ 2,000 Dormitory Authority,
State University
Educational Facilities,
5.50%, 5/15/19 1,891,120
Baa1 BBB- 2,250 Dormitory Authority,
Upstate Community
College, 7.20%, 7/1/21 2,527,718
Baa1 NR 2,000 Dormitory Authority,
Upstate Community
College, 7.30%, 7/1/21 2,255,280
Aaa AAA 500 Erie County Water
Authority, Water Works
System, (AMBAC) 6.00%,
12/1/08 531,960
Aaa AAA 500 Metropolitan
Transportation Authority
Commuter Facilities
Bonds, 7.50%, 7/1/19 557,455
Aaa AAA 1,000 New York Local
Government Assistance
Corporation (LGAC),
7.00%, 4/1/16 1,112,750
Aaa AAA 1,500 New York, LGAC, 6.75%,
4/1/21 1,670,610
Aaa BBB 1,000 New York State Housing
Finance Agency (HFA),
Service Contracts,
7.80%, 9/15/01 1,143,750
Aaa AAA 1,775 New York State HFA,
Service Contracts,
7.375%, 9/15/21 2,028,452
</TABLE>
45
<PAGE> 46
NEW YORK MUNICIPALS PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
ESCROWED - (CONTINUED)
Aaa BBB+ 90 New York State Medical
Care Facilities Finance
Agency, (MCFFA), Mental
Health Services
Facilities, 7.75%,
8/15/10 100,586
Aaa AAA 450 New York State MCFFA,
Mental Health Services
Facilities, 7.875%,
8/15/08 510,889
Aaa AAA 3,320 New York State MCFFA,
Mental Health Services
Facilities, 7.50%,
2/15/21 3,751,135
Aaa NR 8,100 New York State Urban
Development Corporation
(UDC) Correctional
Facilities, 6.50%,
1/1/21 8,686,521
Baa1 BBB 4,750 New York State Thruway
Authority, Local Highway
and Bridge Service
Contract Bonds, 7.25%,
1/1/10 (2) 5,288,650
Baa1 BBB 500 New York State UDC,
Alfred Technology,
7.875%, 1/1/20 559,015
Baa1 BBB 750 New York State UDC,
Clarkson Center, 7.80%,
1/1/20 852,308
Baa1 BBB 750 New York State UDC,
Clarkson Center, 8.00%,
1/1/20 854,903
Aaa AAA 5,350 New York State UDC,
Onondaga Co. Convention
Center, 7.875, 1/1/10 6,106,222
Aaa AAA 500 Oyster Bay (FGIC),
6.60%, 2/15/12 548,360
Aaa AAA 450 Oyster Bay (FGIC),
6.60%, 2/15/13 493,524
NR AA- 500 Power Authority of the
State of New York,
8.00%, 1/1/17 532,560
NR AAA 1,760 Puerto Rico Highway &
Transportation
Authority, 6.625%,
7/1/18 1,958,282
Baa1 AAA 3,750 Puerto Rico Aqueduct &
Sewer Authority, 7.875%,
7/1/17 4,062,113
Baa1 AAA 4,840 Puerto Rico Highway and
Transportation
Authority, 6.625%,
7/1/18 5,385,274
------------
$ 57,038,432
------------
GENERAL OBLIGATIONS - 1.3%
Baa1 BBB+ $ 120 New York City, 8.25%,
11/15/16 $ 137,923
Baa1 BBB+ 4,000 New York City, 7.50%,
2/1/18 4,394,040
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
Aa AA 1,700 Onondaga County, 5.875%,
2/15/11 1,776,381
Aa AA 1,600 Onondaga County, 5.875%,
2/15/12 1,654,832
------------
$ 7,963,176
------------
HEALTH CARE - 16.8%
NR AAA $ 6,705 Dormitory Authority,
United Health Services,
FHA Insured Mortgage,
7.35%, 8/1/29 $ 7,222,760
NR AA 1,000 Dormitory Authority, St.
Johns, FHA Insured
Nursing Home 6.05%,
2/1/16 1,019,610
Baa1 BBB+ 10,000 Dormitory Authority,
Mental Health Facilities
5.375%, 2/15/26 8,964,200
Aa AA 750 New York State MCFFA,
Hospital and Nursing
Insured Mortgage (FHA),
7.35%, 2/15/29 805,725
NR AAA 3,395 New York State MCFFA,
Hospital and Nursing
Insured Mortgage (FHA),
6.125%, 2/15/14 3,513,248
NR AA 9,000 New York State MCFFA,
Hospital and Nursing
Insured Mortgage (FHA),
6.70%, 8/15/23 9,458,640
Aa AA 6,600 New York State MCFFA,
Hospital and Nursing
Insured Mortgage (FHA),
7.20%, 2/15/31 7,132,422
Aa AA 1,500 New York State MCFFA,
Hospital and Nursing
Insured Mortgage (FHA),
6.95%, 2/15/32 1,597,650
Aa AA 2,190 New York State MCFFA,
Hospital and Nursing
Insured Mortgage (FHA),
7.00%, 8/15/32 2,350,220
Aa AA 1,050 New York State MCFFA,
Hospital and Nursing
Insured Mortgage (FHA),
6.75%, 2/15/12 1,116,119
Aa AA 1,000 New York State MCFFA,
Hospital and Nursing
Insured Mortgage (FHA),
6.55%, 8/15/12 1,044,180
NR AA+ 2,670 New York State MCFFA,
Hospital and Nursing
Insured Mortgage (FHA),
6.10%, 8/15/15 2,720,169
Aa AA 3,500 New York State MCFFA,
Insured Mortgage Project
(FHA), 6.20%, 8/15/14 3,619,700
</TABLE>
46
<PAGE> 47
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
HEALTH CARE - (CONTINUED)
Aa AA 6,550 New York State MCFFA,
Insured Mortgage Project
(FHA), 6.25%, 8/15/15 6,781,805
Aa AA 6,625 New York State MCFFA,
Insured Mortgage Project
(FHA), 6.20%, 8/15/15 6,798,244
Aa AA 950 New York State MCFFA,
Insured Mortgage Project
(FHA), 7.45%, 8/15/31 1,038,388
Baa1 BBB+ 1,610 New York State MCFFA,
Mental Health Services
Facilities, 7.625%,
8/15/17 1,797,951
Baa1 BBB+ 145 New York State MCFFA,
Mental Health Services
Facilities, 7.75%,
8/15/10 159,326
Baa1 BBB+ 495 New York State MCFFA,
Mental Health Services
Facilities, 7.875%,
8/15/08 552,237
Baa1 BBB+ 1,230 New York State MCFFA,
Mental Health Services
Facilities, 7.50%,
2/15/21 1,360,823
Baa NR 5,540 New York State MCFFA,
Secured Hospital, 7.35%,
8/15/11 5,929,296
Baa BBB 19,700 New York State MCFFA,
Secured Hospital
(Brookdale), 6.80%,
8/15/12 20,500,214
Baa1 BBB+ 4,785 New York State MCFFA,
Mental Health Services
Facilities, Series 1994
A, 5.25%, 8/15/23 4,199,220
------------
$ 99,682,147
------------
HOSPITALS - 0.8%
Aa AAA $ 1,500 Dormitory Authority,
Long Island Jewish
Medical Center (FHA),
7.75%, 8/15/27 $ 1,588,305
NR AAA 1,000 Dormitory Authority, St.
Francis Hospital (FHA),
7.65%, 8/1/30 1,101,470
Baa1 BBB+ 1,800 Syracuse Industrial
Development Agency
(IDA), St. Joseph's
Hospital Health Center,
7.50%, 6/1/18 1,909,800
------------
$ 4,599,575
------------
HOUSING - 5.9%
NR NR $ 4,662 New York City Housing
Development Corporation
(HDC), Allerville
Project, 6.50%, 11/15/18 $ 4,772,466
NR NR 2,044 New York City HDC,
Dayton Project, 6.50%
11/15/18 2,068,286
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
NR AAA 2,550 New York City HDC,
Multi-Unit Management,
7.35%, 6/1/19 2,683,620
Baa A 4,750 New York City HDC,
General Housing, 6.50%,
5/1/22 4,750,000
Aa AAA 235 New York State Housing
Finance Agency, Baytown,
7.10%, 8/15/35 248,942
Aa NR 510 New York State Mortgage
Agency, 7.70%, 10/1/12 545,924
Aa NR 8,750 New York State Mortgage
Agency, 6.90%, 4/1/15 9,316,563
Aa NR 500 New York State Mortgage
Agency, 6.65%, 4/1/22 518,770
Aa NR 1,000 New York State Mortgage
Agency, 7.50%, 4/1/15 1,081,050
Aa NR 1,600 New York State Mortgage
Agency (AMT), 7.95%,
10/1/21 1,712,832
Aa NR 6,350 New York State Mortgage
Agency (AMT), 6.40%,
10/1/20 6,433,122
Baa BBB 350 Puerto Rico Commonwealth
Urban Renewal & Housing
Corporation, 7.875%,
10/1/04 384,727
Aaa AAA 365 Puerto Rico Housing
Financial Corporation
Single-Family (GNMA),
7.65%, 10/15/22 384,137
------------
$ 34,900,439
------------
INDUSTRIAL DEVELOPMENT
REVENUE - 0.5%
Baa3 BB+ $ 2,800 Port Authority of New
York and New Jersey,
Delta Airlines LaGuardia
Airport, 6.95%, 6/1/08 $ 2,983,932
------------
INSURED COLLEGES &
UNIVERSITIES - 0.4%
Aaa AAA $ 2,000 Dormitory Authority, New
York University (MBIA),
5.00%, 7/1/11 $ 1,872,820
Aaa AAA 450 Dormitory Authority,
Colgate University
(MBIA), 6.00%, 7/1/16 471,843
------------
$ 2,344,663
------------
INSURED GENERAL OBLIGATION - 0.0%
Aaa AAA $ 1,035 Erie County Water
Authority (AMBAC), 0%,
12/1/17 $ 226,955
------------
</TABLE>
47
<PAGE> 48
NEW YORK MUNICIPALS PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED GENERAL
OBLIGATIONS LOCAL - 1.7%
Aaa AAA $ 465 Chautauqua County
Unlimited Tax (FGIC),
7.30%, 4/1/07 $ 544,445
Aaa AAA 520 Chautauqua County
Unlimited Tax (FGIC),
6.40%, 9/15/08 571,594
Aaa AAA 770 Chautauqua County
Unlimited Tax (FGIC),
6.40%, 9/15/09 843,304
Aaa AAA 725 Jamestown, (Secondary
AMBAC), 7.00%, 3/15/07 831,684
Aaa AAA 600 Jamestown, (Secondary
AMBAC), 7.00%, 3/15/08 688,920
Aaa AAA 700 Jamestown, (Secondary
AMBAC), 7.10%, 3/15/09 809,585
Aaa AAA 700 Jamestown, (Secondary
AMBAC), 7.10%, 3/15/10 811,986
Aaa AAA 700 Jamestown, (Secondary
AMBAC), 7.10%, 3/15/11 813,687
Aaa AAA 675 Jamestown, (Secondary
AMBAC), 7.10%, 3/15/12 785,639
Aaa AAA 675 Jamestown, (Secondary
AMBAC), 7.10%, 3/15/13 786,078
Aaa AAA 515 Jamestown, (Secondary
AMBAC), 7.10%, 3/15/14 599,671
Aaa AAA 2,000 New York City (AMBAC),
7.00%, 8/1/17 2,218,080
------------
$ 10,304,673
------------
INSURED GENERAL
OBLIGATIONS SCHOOL
DISTRICT - 0.3%
Aaa AAA $ 700 Bethlehem Central School
District (AMBAC), 7.10%,
11/1/08 $ 814,709
Aaa AAA 700 Bethlehem Central School
District (AMBAC), 7.10%,
11/1/09 814,135
------------
$ 1,628,844
------------
INSURED GENERAL
OBLIGATIONS (TERRITORY) - 0.8%
Aaa AAA $ 4,500 Commonwealth of Puerto
Rico Public Improvement
Residual Interest Tax
Exempt Securities (FSA),
Variable, 7/1/22 (1) $ 4,628,340
------------
INSURED HEALTH CARE - 3.5%
Aaa AAA $12,630 New York State Dormitory
Authority, Mental Health
Facilities (MBIA)
5.125%, 8/15/21 $ 11,622,758
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
Aaa AAA 1,500 New York State MCFFA,
Long Term Health Care
(FSA), 6.80%, 11/1/14 1,602,690
Aaa AAA 1,300 New York State MCFFA,
New York Hospital FHA
Insured Mortgage
(AMBAC), 6.60%, 2/15/11 1,419,522
Aaa AAA 5,400 New York State MCFFA,
New York Hospital FHA
Insured Mortgage
(AMBAC), 6.75%, 8/15/14 5,889,240
------------
$ 20,534,210
------------
INSURED HOUSING - 0.1%
Aaa AAA $ 500 New York City HDC,
Charter Oaks (MBIA),
7.375% 4/1/17 $ 518,075
------------
INSURED MISCELLANEOUS - 0.1%
Aaa AAA $ 500 New York City IDA, (USTA
National Tennis Center
Incorporated Project)
(FSA), 6.375%, 11/15/14 $ 530,770
------------
INSURED MUNICIPAL
ELECTRIC - 2.0%
Aaa AAA $12,150 New York State Energy
Research & Development
Authority, Brooklyn
Union Gas, (MBIA),
5.50%, 1/1/21 $ 11,815,997
------------
INSURED SOLID WASTE - 1.5%
Aaa AAA $ 1,650 Dutchess County Resource
Recovery Solid Waste
(FGIC), 7.50%, 1/1/09 $ 1,788,666
Aaa AAA 6,795 Islip Resource Recovery
Agency (MBIA), 6.50%,
7/1/09 7,390,106
------------
$ 9,178,772
------------
INSURED TOLL & TURNPIKE - 1.1%
NR AAA $ 3,000 Triborough Bridge &
Tunnel Authority,
(TBTA), Residual
Interest Tax Exempt
Securities (MBIA),
Variable, 1/1/19 (1) $ 3,042,750
Aaa AAA 3,000 TBTA, Residual Interest
Tax Exempt Securities
(AMBAC) Variable, 1/1/12
(1) 3,221,730
------------
$ 6,264,480
------------
INSURED UTILITY OTHER - 0.8%
Aaa AAA $ 5,000 Puerto Rico Telephone
Authority, (MBIA),
Variable, 1/25/07 (1) $ 4,954,050
------------
</TABLE>
48
<PAGE> 49
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED WATER & SEWER - 0.0%
Aaa AAA $ 275 Albany Municipal Water
Financial Authority
(MBIA), 7.50%, 12/1/17 $ 295,243
------------
LEASE/CERTIFICATE OF
PARTICIPATION - 11.2%
Baa1 BBB $ 5,100 Dormitory Authority,
City University, 7.00%,
7/1/09 $ 5,655,084
Baa1 BBB 4,325 Dormitory Authority,
City University, 7.50%,
7/1/10 4,978,681
Baa1 BBB 15,815 Dormitory Authority,
City University, 5.75%,
7/1/13 15,612,726
Baa1 BBB 5,500 Dormitory Authority,
City University, 5.625%,
7/1/16 5,305,740
Baa1 BBB+ 13,380 New York State HFA
Health Facilities,
6.00%, 5/1/06 13,505,237
Baa1 BBB 250 Dormitory Authority,
City University, 6.375%,
7/1/08 260,895
NR BBB 5,865 New York State Thruway
Authority, 0%, 1/1/01 4,648,951
NR BBB 2,350 New York State Thruway
Authority, 0%, 1/1/03 1,649,418
Baa1 BBB 12,200 New York State UDC,
5.70%, 4/1/20 11,861,694
A A 1,825 Syracuse - Hancock
International Airport,
6.625%, 1/1/12 1,913,914
NR BBB 1,000 Dormitory Authority,
City University,
(Cross-over Refunded
'98) 8.125%, 7/1/08 1,083,850
------------
$ 66,476,190
------------
MISCELLANEOUS - 1.7%
Aa AA- $ 200 City of New York
Municipal Assistance
Corporation, 7.50%,
7/1/08 $ 213,778
Aa AA- 485 City of New York
Municipal Assistance
Corporation, 7.625%,
7/1/08 519,420
Aa AA- 635 City of New York
Municipal Assistance
Corporation, 7.625%,
7/1/08 695,655
NR NR 1,300 New York City IDA, (YMCA
of Greater New York),
8.00%, 8/1/16 1,385,787
Aaa AAA 7,000 VRDC-IVRC Trust, (NY
MTA), Variable, 6/26/02
(1) 7,128,450
------------
$ 9,943,090
------------
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
SOLID WASTE - 2.1%
A NR $ 2,665 Hempstead IDA Resource
Recovery, American
Refunding Fuel
Co.,7.40%, 12/1/10 $ 2,727,494
Baa NR 9,530 New York State EFC
Resource Recovery,
Huntington Project,
7.50%, 10/1/12 10,033,184
------------
$ 12,760,678
------------
SPECIAL TAX REVENUE - 11.8%
A A $ 4,750 New York State LGAC,
5.25%, 4/1/16 $ 4,516,395
A A 5,225 New York State LGAC,
5.50%, 4/1/17 5,118,096
A A 3,300 New York State LGAC,
6.875%, 4/1/19 3,594,459
A A 4,000 New York State LGAC,
5.50%, 4/1/21 3,834,000
A A 26,170 New York State LGAC,
5.00%, 4/1/23 23,288,945
A A 5,000 New York State LGAC,
5.00%, 4/1/21 4,528,700
A A 21,000 New York State LGAC,
5.00%, 4/1/21 18,766,860
NR BBB+ 2,630 New York State Municipal
Bond Bank Agency,
6.875%, 3/15/06 2,811,943
Baa1 BBB 3,335 TBTA, Convention Center,
6.00%, 1/1/11 3,382,524
------------
$ 69,841,922
------------
TRANSPORTATION - 2.7%
A1 AA- $ 1,500 Port Authority of New
York and New Jersey
(AMT), Variable, 1/15/27
(1) $ 1,551,960
Aa A+ 11,580 TBTA General Purpose,
5.50%, 1/1/17 11,592,854
Aa A+ 2,500 TBTA General Purpose,
6.125%, 1/1/21 2,676,125
------------
$ 15,820,939
------------
WATER & SEWER REVENUE - 3.4%
Aa A $11,050 New York State EFC,
State Water Pollution
Control, 6.875%, 6/15/10 $ 12,101,850
Aa A+ 4,545 New York State EFC,
State Water Pollution
Control, 7.20%, 3/15/11 4,948,323
</TABLE>
49
<PAGE> 50
NEW YORK MUNICIPALS PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
WATER & SEWER REVENUE - (CONTINUED)
Aa A 2,750 New York State EFC,
State Water Pollution
Control, 7.00%, 6/15/12 3,030,912
Aa A 150 New York State EFC,
State Water Pollution
Control, 7.50%, 6/15/12 165,705
------------
$ 20,246,790
------------
TOTAL TAX-EXEMPT
INVESTMENTS (IDENTIFIED
COST, $559,321,735) $ 593,625,179
============
</TABLE>
(1) Security has been issued as an inverse floater bond.
(2) Security has been segregated to cover margin requirements on open financial
futures contracts.
AMT - Interest earned from these securities may be considered a tax preference
item for purposes of the Federal Alternative Minimum Tax.
The Portfolio primarily invests in debt securities issued by New York
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at September 30, 1996, 22.5% of the securities in the portfolio of
investments are backed by bond insurance of various financial institutions and
financial guaranty assurance agencies. The aggregate percentage insured by
financial institution ranged from 0.1% to 9.9% of total investments.
See notes to financial statements
50
<PAGE> 51
Ohio Municipals Portfolio
Portfolio of Investments - September 30, 1996
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS - 100%
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
EDUCATION - 6.3%
A A+ $ 1,000 University of
Cincinnati, 6.50%,
12/1/11 $ 1,033,880
A1 AA- 650 University of
Cincinnati, 6.50%,
6/1/11 687,635
Aa AA- 550 Ohio State Higher
Educational Facilities,
Case Western University,
6.50%, 10/1/20 614,114
NR AAA 1,500 Ohio Higher Educational
Facilities, Ohio
Northern University
(CLEE), 5.60%, 5/1/13 1,490,325
A1 NR 7,000 Ohio State Student Loan
Funding Corp (AMT),
6.10%, 8/1/07 7,053,550
A1 NR 7,000 Ohio State Student Loan
Funding Corp (AMT),
6.10%, 8/1/08 7,014,700
-------------
$ 17,894,204
-------------
ESCROWED - 2.5%
NR NR $ 1,650 Cuyahoga County-Judson
Retirement Community,
8.875%, 11/15/19 $ 1,900,685
NR BBB+ 1,000 Lucas County, Flowers
Hospital, 6.125%,
12/01/13 1,088,240
A AAA 2,760 Middleburg Heights
Hospital-Southwest
General, 6.75%, 8/15/21 3,066,553
Baa1 NR 1,000 Scioto City Ohio, 7.15%,
8/1/11 1,117,210
-------------
$ 7,172,688
-------------
GENERAL OBLIGATIONS - 7.6%
NR NR $ 3,035 Belmont County, 7.30%,
12/1/17 $ 3,198,465
NR NR 2,450 Cleveland City School
District, 7.25%, 6/15/98 2,476,828
Aaa AAA 1,035 City of Columbus, 5.50%,
11/1/12 1,031,667
A1 NR 1,360 Copley-Fairlawn City
School District, 6.25%,
12/1/15 1,432,502
A1 NR 500 Huber Heights, Ohio,
6.75%, 12/1/11 542,250
A1 NR 725 City of Medina, Ohio
Fire Station
Improvement, 3.00%,
12/1/10 530,142
Aa AA 1,500 Ohio State
Infrastructure
Improvement, 0%, 8/1/11 654,690
Baa1 A 2,500 Puerto Rico Public
Building Authority,
6.00%, 7/1/12 2,508,475
NR NR 1,000 Tuscarawas Public
Library Improvement,
6.90%, 12/1/11 1,073,440
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
Baa NR 1,000 Youngstown, Ohio, 7.55%,
12/1/11 1,098,920
NR NR 6,855 Youngstown, Ohio, 7.35%,
6/15/05 7,318,055
-------------
$ 21,865,434
-------------
HOSPITALS - 22.6%
NR AAA $ 1,000 Allen County Ohio, LIMA
Convalescent Home
Foundation (GNMA),
6.40%, 1/1/21 $ 1,025,460
Baa BBB- 1,000 Butler County, Hamilton-
Hughe Hospital, 7.50%,
1/1/10 1,050,250
NR BBB 1,000 Cambridge Ohio, Guernsey
Memorial Hospital,
8.00%, 12/1/11 1,070,480
A1 A 2,100 Cuyahoga County,
Fairview General
Hospital, 6.25%, 8/15/10 2,156,154
A1 A 2,370 Cuyahoga County, Meridia
Health System, 7.00%,
8/15/23 2,496,108
A1 A 2,000 Cuyahoga County, Meridia
Health System, 6.50%,
8/15/12 2,047,400
Aa AA 750 Cuyahoga County,
University Hospitals
Health System, 6.50%,
1/15/19 779,835
Aa AA 4,450 Cuyahoga County,
University Hospitals
Health System, 6.00%,
1/15/22 4,507,049
NR BBB+ 4,130 Defiance Hospital, Inc.,
7.625%, 11/1/03 4,215,698
Baa BBB- 765 East Liverpool City
Hospital-Series A,
8.00%, 10/1/21 807,167
Baa BBB- 1,000 East Liverpool City
Hospital-Series B,
8.00%, 10/1/21 1,055,120
A A 4,000 Erie County, Firelands
Community Hospital,
6.75%, 1/1/08 4,228,960
Aa NR 2,000 Franklin County,
Children's Hospital,
5.75%, 11/1/20 1,981,880
Aa NR 3,000 Franklin County,
Children's Hospital,
6.60%, 5/1/13 3,170,670
A A 1,015 City of Garfield
Heights, Marymount
Hospital, 6.65%,
11/15/11 1,055,488
A A 1,000 City of Garfield
Heights, Marymount
Hospital, 6.70%,
11/15/15 1,043,070
Aa2 NR 1,000 Hamilton County, Wesley
Hall Project, 6.50%,
3/1/15 1,045,320
A1 A 5,115 Hamilton County,
Bethesda Hospital, Inc.,
6.25%, 1/1/12 5,203,234
</TABLE>
51
<PAGE> 52
OHIO MUNICIPALS PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
HOSPITALS - (CONTINUED)
A1 A+ 1,095 Lorain County, Humility
of Mary Health Care
Corp., 7.125%, 12/15/06 1,190,911
A1 A+ 1,000 Lorain County, Humility
of Mary Health Care
Corp., 7.20%, 12/15/11 1,075,410
A1 A+ 5,900 Lorain County, Humility
of Mary Health Care
Corp., 5.90%, 12/15/08 6,060,833
NR A+ 1,750 Lorain County, Lakeland
Community Hospital,
Inc., 6.50%, 11/15/12 1,800,890
Baa BBB 3,800 Miami, Upper Valley
Medical Center, 6.375%,
5/15/26 3,752,310
NR AAA 500 Muskingham County-
Bethesda Care System
(CLEE), 5.40%, 12/1/16 468,465
NR NR 10,000 Mt Vernon, Knox
Community Hospital,
7.875%, 6/1/12 10,305,300
Aa2 NR 600 Warren County, Otterbein
Home Project, 7.20%,
7/1/11 656,298
-------------
$ 64,249,760
-------------
HOUSING - 11.9%
Aa NR $ 1,300 City of Clermont,
Laurels Project (FHA),
6.00%, 9/1/20 $ 1,306,877
Aa NR 1,000 Franklin County,
Hamilton Creek
Apartments (FHA), (AMT),
5.80%, 7/1/14 959,280
Aa NR 3,645 Franklin County,
Hamilton Creek
Apartments (FHA), (AMT),
5.55%, 7/1/24 3,297,085
Aa NR 2,500 Franklin County MFMR-
Tuttle Park Project
(FHA), (AMT), 6.50%,
3/1/26 2,586,875
Aa NR 5,985 Franklin County MFMR-
Tuttle Park Project
(FHA), (AMT), 6.60%,
3/1/36 6,209,018
NR NR 3,000 Lucas County, County
Creek Project (AMT),
8.00%, 7/1/26 2,850,120
NR AAA 3,490 Ohio HFA, (GNMA), (AMT),
6.375%, 3/1/25 3,503,715
NR AAA 4,735 Ohio HFA, (GNMA), (AMT),
6.70%, 3/1/25 4,865,639
NR AAA 1,250 Ohio HFA, MFMR-Asbury
Woods (FHA), 7.00%,
10/1/24 1,280,550
Aa NR 1,950 Ohio HFA, Oakleaf
Village Project, (FHA),
5.70%, 9/1/26 1,848,308
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
Aa NR 1,000 Ohio HFA, Aristocrat
South Board & Care
Project (FHA), (AMT),
7.30%, 8/1/31 1,034,720
Aaa AAA 985 Ohio HFA SFMR,
(GNMA) (AMT), Variable,
3/31/31 (1) 1,047,390
A1 A+ 500 Ohio Building Authority
Juvenile Correctional
Building, 5.80%, 10/1/07 511,810
Baa BBB 2,925 Puerto Rico Urban
Renewal & Housing, 0%,
10/01/99 2,530,271
-------------
$ 33,831,658
-------------
INDUSTRIAL DEVELOPMENT/
POLLUTION CONTROL REVENUE - 11.8%
Aa NR $ 2,000 Cuyahoga, IDR-Chippewa
Place Project, 6.60%,
8/1/15 $ 2,095,520
Baa1 NR 3,750 Ohio Air Quality
Development Authority,
Ashland Oil Inc, 6.85%,
4/1/10 3,995,550
NR A- 575 Ohio IDR, Enterprise
Bond Fund, Burrows Paper
Corp. (AMT), 7.625%,
6/1/11 634,507
NR A- 285 Ohio IDR, Enterprise
Bond Fund, Cheryl & Co.,
(AMT), 5.50%, 12/1/04 286,838
NR A- 530 Ohio IDR, Enterprise
Bond Fund, Cheryl & Co.,
(AMT), 5.90%, 12/1/09 538,856
NR A- 1,735 Ohio IDR, Enterprise
Bond Fund, Consolidated
Biscuit, (AMT), 7.00%,
12/1/09 1,936,121
NR A- 3,345 Ohio IDR, Enterprise
Bond Fund, J J & W LP
Project (AMT), 6.70%,
12/1/14 3,480,640
NR A- 750 Ohio IDR, Enterprise
Bond Fund, Luigino's
Inc. (AMT), 6.85%,
6/1/01 766,965
NR A- 850 Ohio IDR, Enterprise
Bond Fund, Progress
Plastic Products, (AMT),
6.80%, 12/1/01 920,771
NR A- 1,525 Ohio IDR, Enterprise
Bond Fund, Progress
Plastic Products, (AMT),
7.80%, 12/1/09 1,775,863
NR A- 680 Ohio IDR, Enterprise
Bond Fund, Royal
Appliance Manufacturing
Co., Series 1991 #9
(AMT), 7.625%, 12/1/11 755,664
</TABLE>
52
<PAGE> 53
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
INDUSTRIAL DEVELOPMENT/
POLLUTION CONTROL
REVENUE - (CONTINUED)
NR A- 1,000 Ohio IDR, Enterprise
Bond Fund, Royal
Appliance Manufacturing
Co., Series 1991 #5
(AMT), 7.625%, 12/1/11 1,111,270
NR A- 880 Ohio IDR, Enterprise
Bond Fund, VSM Corp.,
(AMT), 7.375%, 12/1/11 968,140
NR AA- 1,000 Ohio Pollution Control,
Standard Oil Company,
6.75%, 12/1/15 1,145,520
NR BB- 1,020 Ohio Economic
Development, KMART
Corp., 6.75%, 5/15/07 1,008,505
NR NR 1,500 Ohio State Solid Waste-
Republic Engineering
Steel (AMT), 9.00%,
6/1/21 1,568,055
Baa2 BBB 3,990 Ohio Water Development
Authority, Union Carbide
Corp. Project, 5.50%,
1/15/07 3,931,187
Ba2 NR 1,500 Portage County, Kroger
Corporation, 7.25%,
7/1/99 1,566,615
Baa3 BB+ 4,000 Puerto Rico Port
Authority-American
Airlines (AMT), 6.25%,
6/1/26 4,045,800
Ba2 NR 1,000 Summit County, IDR-
Kroger Corporation,
6.85%, 7/1/99 1,035,900
-------------
$ 33,568,287
-------------
INSURED - EDUCATION - 0.4%
Aaa AAA $ 1,000 Ohio Higher Education,
University of Dayton
Project (FGIC), 5.80%,
12/1/14 $ 1,014,470
-------------
INSURED - GENERAL OBLIGATION - 2.6%
Aaa AAA $ 1,000 Hilliard Ohio School
District (FGIC), 5.00%,
12/1/20 $ 902,640
Aaa AAA 1,595 Marion County Local
School District (MBIA),
5.375%, 12/1/19 1,536,591
Aaa AAA 1,700 Puerto Rico (AMBAC),
Variable, 7/1/15 (1) 1,728,050
Aaa AAA 3,000 Puerto Rico (FSA),
Variable, 7/1/22 (1) 3,085,560
-------------
$ 7,252,841
-------------
INSURED - HEALTHCARE - 0.7%
Aaa AAA $ 1,945 Hamilton County, Sisters
of Charity Health Care
System (MBIA), 5.25%,
5/15/13 $ 1,845,649
-------------
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
INSURED - HOSPITAL - 12.5%
Aaa AAA $ 2,500 Akron, Bath and Copley
Townships Children's
Hospital Medical Center
of Akron, (AMBAC),
5.25%, 11/15/20 $ 2,334,750
Aaa AAA 1,000 Clermont County, Mercy
Health System (AMBAC),
Variable, 10/5/21 (1) 1,149,040
Aaa AAA 1,500 Cuyahoga County,
Fairview Hospital,
(MBIA), 5.50%, 8/15/19 1,417,905
Aaa AAA 2,750 Cuyahoga County,
Fairview Hospital,
(MBIA), 5.50%, 1/15/17 2,652,073
Aaa AAA 9,500 Franklin County,
Riverside United
Methodist (AMBAC),
5.75%, 5/15/20 9,426,470
Aaa AAA 3,325 Franklin County,
Riverside United
Methodist (MBIA), 5.75%,
5/15/20 3,320,478
Aaa AAA 2,750 Mansfield General
Hospital (AMBAC), 6.70%,
12/1/09 2,968,763
Aaa AAA 5,000 Middleburg Heights
Hospital-Southwestern
General (FSA), 5.75%,
8/15/21 4,960,350
Aaa AAA 1,000 Montgomery County, Ohio
Miami Valley Hospital,
(AMBAC), 6.25%, 11/15/16 1,046,500
Aaa AAA 6,565 Portage County, Robinson
Memorial Hospital,
(MBIA), 5.80%, 11/15/15 6,394,506
-------------
$ 35,670,835
-------------
INSURED - HOUSING - 1.0%
Aaa AAA $ 980 Ohio Capital Corporation
FHA Insured Mortgage
Loans, (MBIA), 7.25%,
7/1/24 $ 1,022,012
Aaa AAA 750 Ohio Capital Corporation
FHA Insured Mortgage
Loans, (MBIA), 6.50%,
1/1/25 767,108
Aaa AAA 1,100 Ohio Capital Corporation
MFMR-Horizon Apts.
(MBIA), 6.50%, 1/1/23 1,137,664
-------------
$ 2,926,784
-------------
INSURED - IDR/IDB - 2.6%
Aaa AAA $ 7,000 Ohio Air Quality
Development Authority,
JMG Funding, L.P.
Project, (AMBAC), (AMT),
6.375%, 1/1/29 $ 7,318,220
-------------
</TABLE>
53
<PAGE> 54
OHIO MUNICIPALS PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED - LEASE - 0.2%
Aaa AAA $ 1,000 Ohio Higher Education,
University of Dayton,
(FGIC), 0%, 12/1/06 $ 591,200
-------------
INSURED - SPECIAL TAX REVENUE - 0.5%
Aaa AAA $ 2,110 Hudson Local School
District, (FGIC), 0%,
12/15/09 $ 1,033,605
Aaa AAA 1,000 Hudson Local School
District, (FGIC), 0%,
12/15/10 460,880
-------------
$ 1,494,485
-------------
INSURED - UTILITIES - 2.2%
Aaa AAA $ 1,650 Cleveland Public Power
System, (MBIA), 7.00%,
11/15/17 $ 1,815,792
Aaa AAA 2,000 Cuyahoga County Medical
Center Utility System
(AMT) (MBIA), 6.10%,
8/15/15 2,029,960
Aaa AAA 2,300 Puerto Rico Electric
Power Authority, (FSA),
Variable, 7/1/02 (1) 2,469,671
-------------
$ 6,315,423
-------------
LIFE CARE - 1.7%
Aa NR $ 1,995 Franklin County,
Kensington Place
Project, 6.75%,
1/1/34 (2) $ 2,056,945
Aa2 NR 1,000 Hamilton,
Hospital-Episcopal
Retirement Home, 6.80%,
1/1/08 1,085,900
NR BBB- 1,800 Marion, Health
Care-United Church Home,
6.30%, 11/15/15 1,768,464
-------------
$ 4,911,309
-------------
NURSING HOMES - 1.2%
NR NR $ 3,100 Green County-Fairview
Extended Care, 10.125%,
1/1/11 $ 3,508,208
-------------
SPECIAL TAX REVENUE - 3.7%
Baa1 A $ 3,000 Puerto Rico Highway &
Transportation
Authority, 6.625%,
7/1/12 $ 3,184,740
Baa1 A 5000 Puerto Rico Highway &
Transportation
Authority, 5.25%, 7/1/20 4,617,100
Baa1 A 3000 Puerto Rico Highway &
Transportation
Authority, 5.00%, 7/1/36 2,620,260
-------------
$ 10,422,100
-------------
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
TRANSPORTATION - 2.0%
NR BBB $ 5,630 Guam Airport Authority,
(AMT), 6.70%, 10/1/23 $ 5,732,577
-------------
UTILITIES - 5.0%
NR BBB $ 5,500 Guam Power Authority,
5.25%, 10/1/13 (3) $ 4,966,500
A1 A+ 1,935 Ohio State Air Quality
Development Authority,
6.10%, 9/1/30 1,970,352
Baa1 BBB+ 360 Puerto Rico Electric
Power Authority, 7.125%,
7/1/14 385,697
Baa1 BBB+ 20,165 Puerto Rico Electric
Power Authority, 0%,
7/1/17 5,879,913
NR NR 1,000 Virgin Islands Water and
Power Authority, 7.40%,
7/1/11 1,058,840
-------------
$ 14,261,302
-------------
WATER & SEWER REVENUE - 1.0%
NR NR $ 800 Mahoning Valley Sanitary
District, 7.80%,
12/15/08 $ 836,040
NR NR 950 Mahoning Valley Sanitary
District, 7.80%,
12/15/09 990,081
NR NR 1,000 City of Vermilion, Ohio
Water System, 7.25%,
8/15/15 1,070,350
-------------
$ 2,896,471
-------------
TOTAL TAX-EXEMPT
INVESTMENTS (IDENTIFIED
COST, $271,985,967) $ 284,743,905
===============
</TABLE>
(1) Security has been issued as an inverse floater bond.
(2) Security has been segregated to cover margin requirements on open financial
futures contracts.
AMT - Interest earned from these securities may be considered a tax preference
item for purposes of the Federal Alternative Minimum Tax.
The Portfolio invests primarily in debt securities issued by Ohio
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at September 30, 1996, 31.5% of the securities in the portfolio of
investments are backed by bond insurance of various financial institutions and
financial guaranty assurance agencies. The aggregate percentage by financial
institution ranged from 1.1% to 9.1% of total investments.
See notes to financial statements.
54
<PAGE> 55
West Virginia Municipals Portfolio
Portfolio of Investments - September 30, 1996
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENT - 100%
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
ELECTRIC UTILITIES - 11.2%
NR BBB $ 750 Guam Power Authority,
5.25%, 10/1/13 $ 677,250
NR BBB 500 Guam Power Authority,
5.25%, 10/1/23 436,355
A2 A 2,000 Harrison, West Virginia
PCR (Monongahela Power
Company Harrison
Station), 6.75%, 8/1/24 2,105,380
A3 BBB+ 1,000 Mason, West Virginia PCR
(Appalachian Power Co.),
6.85%, 6/1/22 1,055,250
-------------
$ 4,274,235
-------------
ESCROWED - 2.0%
Aaa AAA $ 2,500 Kanawha-Putnam, West
Virginia Single Family
Mortgage (AMBAC), 0%,
12/1/16 $ 759,125
-------------
GENERAL OBLIGATION - 1.0%
NR BBB $ 400 Guam General Obligation,
5.375%, 11/15/13 $ 366,248
-------------
HOSPITALS - 10.6%
NR BBB+ $ 1,750 Berkeley, West Virginia
Building Commission
(City Hospital), 6.50%,
11/1/22 $ 1,758,592
Baa1 NR 350 Princeton, West Virginia
(Community Hospital),
6.00%, 5/1/18 330,600
A1 NR 1,000 West Virginia HFA
(Charleston Area Medical
Center), 6.50%, 9/1/23 1,041,920
A1 NR 875 West Virginia HFA
(Charleston Area Medical
Center), 6.50%, 9/1/16 914,585
-------------
$ 4,045,697
-------------
HOUSING - 1.2%
Aa1 AA+ $ 500 West Virginia Housing
Development Finance,
5.55%, 5/1/17 $ 472,455
-------------
INDUSTRIAL DEVELOPMENT
REVENUE/POLLUTION CONTROL
REVENUE - 20.2%
A2 A $ 2,000 Braxton, West Virginia
Solid Waste
(Weyerhaeuser) (AMT),
6.50%, 4/1/25 $ 2,053,520
NR A- 1,375 Jefferson, West Virginia
IDR (Royal Vendors,
Incorporated), (AMT),
5.90%, 8/1/04 1,397,233
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
Baa2 BBB 300 Kanawha, West Virginia
IDR (Union Carbide
Chemicals and Plastics
Company), (AMT) 8.00%,
8/1/20 326,283
A2 NR 1,500 Puerto Rico IM&E
(American Home Products
Corporation), 5.10%,
12/1/18 1,371,570
Baa3 BB+ 1,025 Puerto Rico Port
Authority (American
Airlines) (AMT), 6.30%,
6/1/23 1,037,832
Baa3 BB+ 500 Puerto Rico Port
Authority (American
Airlines) (AMT), 6.25%,
6/1/26 505,724
NR NR 1,000 Upshur, West Virginia
Solid Waste (TJI
Project) (AMT), 7.00%,
7/15/25 1,029,590
-------------
$ 7,721,752
-------------
INSURED EDUCATION - 7.3%
Aaa AAA $ 1,150 West Virginia State
College System (AMBAC),
6.00%, 4/1/12, (2) $ 1,187,812
Aaa AAA 550 West Virginia State
University System
(AMBAC), 6.00%, 4/1/12 568,084
Aaa AAA 1,000 West Virginia State
University (Marshall
Library) (AMBAC), 5.75%,
4/1/16 1,003,120
-------------
$ 2,759,016
-------------
INSURED ELECTRIC UTILITIES - 6.1%
Aaa AAA $ 750 Marshall, West Virginia
PCR (Ohio Power Kammer
Plant) (MBIA), 5.45%,
7/1/14 $ 730,800
Aaa AAA 880 Mason, West Virginia PCR
(Ohio Power Company)
(AMBAC), 5.45%, 12/1/16 850,687
Aaa AAA 250 Puerto Rico Electric
Power Authority (FSA),
Variable, 7/1/03, (1) 271,113
Aaa AAA 500 Putnam, West Virginia
PCR (Appalachian Power
Company) (AMBAC), 5.45%,
6/1/19 480,475
-------------
$ 2,333,075
-------------
</TABLE>
55
<PAGE> 56
WEST VIRGINIA MUNICIPALS PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED GENERAL OBLIGATION - 6.8%
Aaa AAA $ 745 Berkeley, West Virginia
Board of Education
(FGIC), 4.125%, 6/1/10 $ 636,521
Aaa AAA 1,000 West Virginia (FGIC),
5.75%, 11/1/21 1,011,230
Aaa AAA 1,000 West Virginia (FGIC),
5.25%, 11/1/26 942,400
-------------
$ 2,590,151
-------------
INSURED HOSPITAL - 12.2%
Aaa AAA $ 1,100 West Virginia HFA
(Linked Bulls & Bears)
(MBIA), 6.10%, 1/1/18 $ 1,119,173
Aaa AAA 2,000 West Virginia HFA
(University Hospital)
(MBIA), 5.00%, 6/1/16 1,796,300
Aaa AAA 1,300 West Virginia HFA
(Cabell Huntington
Hospital) (AMBAC),
6.25%, 1/1/19 1,364,974
Aaa AAA 350 West Virginia HFA
(Charleston Area Medical
Center) (MBIA), 5.75%,
9/1/13 351,103
-------------
$ 4,631,550
-------------
INSURED TRANSPORTATION - 2.2%
Aaa AAA $ 1,250 West Virginia Parkways
Economic Development and
Tourism Authority
(FGIC), 0%, 5/15/04 $ 830,538
-------------
INSURED WATER & SEWER - 15.9%
Aaa AAA $ 1,250 Berkeley, West Virginia
Public Service District
Sewer (MBIA), 5.75%,
10/1/25 $ 1,248,238
NR AAA 500 Crab Orchard-MacArthur,
West Virginia Sewerage
(AMBAC), 5.50%, 10/1/25 480,414
Aaa AAA 750 Greenbrier, West
Virginia Public Service
District Sewer (MBIA),
5.625%, 10/1/19 739,058
Aaa AAA 500 Huntington, West
Virginia Sewerage System
(FSA), 5.375%, 11/1/23 469,180
500 Parkersburg, West
Virginia Waterworks and
Sewer (FSA), 5.80%,
9/1/19 502,100
<CAPTION>
RATINGS
(UNAUDITED)
- ------------------ PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------
<S> <C> <C> <C> <C>
Aaa AAA 2,000 West Virginia Water
Development (Loan
Program II) (FSA),
5.25%, 11/1/35 1,827,680
Aaa AAA 750 West Virginia Water
Development (Loan
Program II) (FSA),
6.00%, 11/1/14 772,238
-------------
$ 6,038,908
-------------
NURSING HOMES - 2.0%
NR NR $ 745 Kanawha, West Virginia
IDR (Beverly
Enterprises), 7.25%,
11/1/04 $ 754,365
-------------
SPECIAL TAX REVENUE - 1.3%
Baa1 A $ 500 Puerto Rico Highway and
Transportation
Authority, 5.50%, 7/1/15 $ 489,650
-------------
TOTAL TAX-EXEMPT
INVESTMENTS (IDENTIFIED
COST, $37,357,087) $ 38,066,765
=============
</TABLE>
(1) Security has been issued as an inverse floater bond.
(2) Security has been segregated to cover margin requirements on open financial
futures contracts.
AMT - Interest earned from these securities may be considered a tax preference
item for purposes of the Federal Alternative Minimum Tax.
The Portfolio invests primarily in debt securities issued by West Virginia
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at September 30, 1996, 52.4% of the securities in the portfolio of
investments are backed by bond insurance of various financial institutions and
financial guaranty assurance agencies. The aggregate percentage insured by
financial institution ranged from 9.0% to 17.6% of total investments.
See notes to financial statements
56
<PAGE> 57
Municipals Portfolios
Financial Statements
STATEMENTS OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
September 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CALIFORNIA FLORIDA MASSACHUSETTS MISSISSIPPI
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------ ------------ ------------- -----------
<S> <C> <C> <C> <C>
ASSETS:
Investments --
Identified cost $337,396,359 $560,837,654 $259,784,548 $23,820,442
Unrealized appreciation 25,997,282 34,682,152 16,561,293 1,309,790
------------ ----------- ------------ ------------
Total investments, at value (Note 1A) $363,393,641 $595,519,806 $276,345,841 $25,130,232
Cash 1,251,461 10,859,556 337 139,652
Receivable for daily variation margin on open
financial futures contracts (Note 1E) 84,375 223,875 78,469 5,906
Receivable for investments sold -- 13,871,030 -- 20,541
Interest receivable 5,874,698 13,150,484 5,203,030 472,839
Deferred organization expenses (Note 1D) 8,923 12,242 7,209 1,077
------------ ----------- ------------ ------------
Total assets $370,613,098 $633,636,993 $281,634,886 $25,770,247
------------ ----------- ------------ ------------
LIABILITIES:
Demand note payable (Note 5) $ -- $ -- $ 484,000 $ --
Payable for investments purchased -- 9,245,000 -- 488,071
Payable to affiliate --
Trustees' fees (Note 2) 4,213 5,213 3,712 417
Accrued expenses 18,690 12,779 17,938 2,198
------------ ----------- ------------ ------------
Total liabilities $ 22,903 $ 9,262,992 $ 505,650 $ 490,686
------------ ----------- ------------ ------------
NET ASSETS applicable to investors' interest in
Portfolio $370,590,195 $624,374,001 $281,129,236 $25,279,561
============ =========== ============ ============
SOURCES OF NET ASSETS:
Net proceeds from capital contributions and
withdrawals $345,003,950 $591,109,319 $264,876,671 $23,998,544
Unrealized appreciation of investments and
financial futures contracts (computed on the
basis of identified cost) 25,586,245 33,264,682 16,252,565 1,281,017
------------ ----------- ------------ ------------
Total $370,590,195 $624,374,001 $281,129,236 $25,279,561
============ =========== ============ ============
</TABLE>
See notes to financial statements
57
<PAGE> 58
FINANCIAL STATEMENTS (continued)
STATEMENTS OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
September 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NEW YORK OHIO WEST VIRGINIA
PORTFOLIO PORTFOLIO PORTFOLIO
------------ ------------ -------------
<S> <C> <C> <C>
ASSETS:
Investments --
Identified cost $559,321,735 $271,985,967 $37,357,087
Unrealized appreciation 34,303,444 12,757,938 709,678
----------- ------------ ------------
Total investments, at value (Note 1A) $593,625,179 $284,743,905 $38,066,765
Cash 382,818 2,624,350 704,250
Receivable for daily variation margin on open financial
futures contracts (Note 1E) 145,969 76,500 11,250
Receivable for investments sold 80,000 50,041 --
Interest receivable 10,316,594 5,216,871 723,533
Deferred organization expenses (Note 1D) 8,608 5,345 1,105
----------- ------------ ------------
Total assets $604,559,168 $292,717,012 $39,506,903
----------- ------------ ------------
LIABILITIES:
Payable to affiliate --
Trustees' fees (Note 2) $ 5,213 $ 3,713 $ 417
Accrued expenses 24,435 42,483 5,695
----------- ------------ ------------
Total liabilities $ 29,648 $ 46,196 $ 6,112
----------- ------------ ------------
NET ASSETS applicable to investors' interest in Portfolio $604,529,520 $292,670,816 $39,500,791
=========== ============ ============
SOURCES OF NET ASSETS:
Net proceeds from capital contributions and withdrawals $570,585,516 $280,397,239 $38,876,976
Unrealized appreciation of investments and financial
futures contracts (computed on the basis of identified
cost) 33,944,004 12,273,577 623,815
----------- ------------ ------------
Total $604,529,520 $292,670,816 $39,500,791
=========== ============ ============
</TABLE>
See notes to financial statements
58
<PAGE> 59
STATEMENTS OF OPERATIONS
- --------------------------------------------------------------------------------
For the Year Ended September 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CALIFORNIA FLORIDA MASSACHUSETTS MISSISSIPPI
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------- ----------- ------------- -----------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest income (Note 1B) $25,401,268 $41,738,135 $18,541,089 $1,654,970
---------- ---------- ----------- -----------
Expenses --
Investment adviser fee (Note 2) $ 1,942,811 $ 3,123,150 $ 1,343,099 $ 55,976
Compensation of Trustees not members of the
Investment Adviser's organization (Note 2) 17,811 20,749 15,864 1,623
Custodian fee (Note 1J) 173,498 208,454 136,510 16,731
Legal and accounting services 43,579 41,453 35,453 24,384
Bond pricing -- -- -- 5,597
Amortization of organization expenses (Note 1D) 5,640 8,853 5,223 623
Miscellaneous 54,538 133,570 67,101 3,417
---------- ---------- ----------- -----------
Total expenses $ 2,237,877 $ 3,536,229 $ 1,603,250 $ 108,351
---------- ---------- ----------- -----------
Deduct --
Reduction of investment adviser fee (Note 2) $ -- $ -- $ -- $ 27,990
Reduction of custodian fee (Note 1J) 41,453 208,454 28,177 8,361
---------- ---------- ----------- -----------
Total $ 41,453 $ 208,454 $ 28,177 $ 36,351
---------- ---------- ----------- -----------
Net expenses $ 2,196,424 $ 3,327,775 $ 1,575,073 $ 72,000
---------- ---------- ----------- -----------
Net investment income $23,204,844 $38,410,360 $16,966,016 $1,582,970
---------- ---------- ----------- -----------
REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) --
Investment transactions (identified cost basis) $ 5,804,250 $ 7,700,894 $ 3,401,693 $ 358,232
Financial futures contracts (1,261,311) (1,995,643) (305,415) (51,938 )
---------- ---------- ----------- -----------
Net realized gain $ 4,542,939 $ 5,705,251 $ 3,096,278 $ 306,294
---------- ---------- ----------- -----------
Change in unrealized appreciation (depreciation) --
Investments $ 1,694,189 $ 874,146 $ (962,702) $ 147,107
Financial futures contracts (237,538) (1,417,469) (204,628) (1,013 )
---------- ---------- ----------- -----------
Net unrealized appreciation (depreciation) $ 1,456,651 $ (543,323) $(1,167,330) $ 146,094
---------- ---------- ----------- -----------
Net realized and unrealized gain $ 5,999,590 $ 5,161,928 $ 1,928,948 $ 452,388
---------- ---------- ----------- -----------
Net increase in net assets from
operations $29,204,434 $43,572,288 $18,894,964 $2,035,358
========== ========== =========== ===========
</TABLE>
See notes to financial statements
59
<PAGE> 60
FINANCIAL STATEMENTS (continued)
STATEMENTS OF OPERATIONS
- --------------------------------------------------------------------------------
For the Year Ended September 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NEW YORK OHIO WEST VIRGINIA
PORTFOLIO PORTFOLIO PORTFOLIO
----------- ----------- -------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest income (Note 1B) $38,971,505 $19,254,005 $ 2,312,518
----------- ----------- ----------
Expenses --
Investment adviser fee (Note 2) $ 2,932,032 $ 1,404,951 $ 95,361
Compensation of Trustees not members of the
Investment Adviser's organization (Note 2) 20,749 16,357 1,622
Custodian fee (Note 1J) 195,496 150,137 26,173
Interest expense (Note 5) -- 130,578 --
Legal and accounting services 41,684 36,530 24,430
Amortization of organization expenses (Note 1D) 6,313 3,971 633
Miscellaneous 83,059 20,008 17,951
----------- ----------- ----------
Total expenses $ 3,279,333 $ 1,762,532 $ 166,170
----------- ----------- ----------
Deduct --
Reduction of investment adviser fee (Note 2) $ -- $ -- $ --
Reduction of custodian fee (Note 1J) 169,999 47,356 15,840
----------- ----------- ----------
Total $ 169,999 $ 47,356 $ 15,840
----------- ----------- ----------
Net expenses $ 3,109,334 $ 1,715,176 $ 150,330
----------- ----------- ----------
Net investment income $35,862,171 $17,538,829 $ 2,162,188
----------- ----------- ----------
REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) --
Investment transactions (identified cost basis) $ 5,500,573 $ 2,797,956 $ (141,935)
Financial futures contracts (1,445,211) (672,364) 14,161
----------- ----------- ----------
Net realized gain (loss) $ 4,055,362 $ 2,125,592 $ (127,774)
----------- ----------- ----------
Change in unrealized appreciation (depreciation) --
Investments $ 2,600,470 $ 766,247 $ 877,300
Financial futures contracts 3,422 (484,361) (78,550)
----------- ----------- ----------
Net unrealized appreciation $ 2,603,892 $ 281,886 $ 798,750
----------- ----------- ----------
Net realized and unrealized gain $ 6,659,254 $ 2,407,478 $ 670,976
----------- ----------- ----------
Net increase in net assets from operations $42,521,425 $19,946,307 $ 2,833,164
=========== =========== ==========
</TABLE>
See notes to financial statements
60
<PAGE> 61
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
For the Year Ended September 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CALIFORNIA FLORIDA MASSACHUSETTS MISSISSIPPI
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------ ------------- ------------- -----------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations --
Net investment income $ 23,204,844 $ 38,410,360 $ 16,966,016 $ 1,582,970
Net realized gain 4,542,939 5,705,251 3,096,278 306,294
Change in unrealized appreciation
(depreciation) 1,456,651 (543,323) (1,167,330 ) 146,094
------------ ------------ ------------- ------------
Net increase in net assets from operations $ 29,204,434 $ 43,572,288 $ 18,894,964 $ 2,035,358
------------ ------------ ------------- ------------
Capital transactions --
Contributions $ 20,317,562 $ 35,149,563 $ 16,336,133 $ 1,623,996
Withdrawals (89,601,939) (166,550,986) (56,272,108 ) (7,372,753)
------------ ------------ ------------- ------------
Decrease in net assets resulting from
capital transactions $(69,284,377) (131,401,423) $(39,935,975 ) $(5,748,757)
------------ ------------ ------------- ------------
Total decrease in net assets $(40,079,943) $ (87,829,135) $(21,041,011 ) $(3,713,399)
NET ASSETS:
At beginning of year 410,670,138 712,203,136 302,170,247 28,992,960
------------ ------------ ------------- ------------
At end of year $370,590,195 $ 624,374,001 $281,129,236 $25,279,561
============ ============ ============= ============
- -------------------------------------------------------------------------------------------------------------------
<CAPTION>
WEST
NEW YORK OHIO VIRGINIA
PORTFOLIO PORTFOLIO PORTFOLIO
------------- ------------- -----------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations --
Net investment income $ 35,862,171 $ 17,538,829 $ 2,162,188
Net realized gain (loss) 4,055,362 2,125,592 (127,774)
Change in unrealized appreciation 2,603,892 281,886 798,750
------------ ------------ -----------
Net increase in net assets from operations $ 42,521,425 $ 19,946,307 $ 2,833,164
------------ ------------ -----------
Capital transactions --
Contributions $ 36,583,799 $ 11,748,362 $ 3,463,423
Withdrawals (127,312,013) (58,040,501 ) (7,630,857)
------------ ------------ -----------
Decrease in net assets resulting from
capital transactions $ (90,728,214) $(46,292,139 ) $(4,167,434)
------------ ------------ -----------
Total decrease in net assets $ (48,206,789) $(26,345,832 ) $(1,334,270)
NET ASSETS:
At beginning of year 652,736,309 319,016,648 40,835,061
------------ ------------ -----------
At end of year $ 604,529,520 $292,670,816 $39,500,791
============ ============ ===========
</TABLE>
See notes to financial statements
61
<PAGE> 62
FINANCIAL STATEMENTS (continued)
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
For the Year Ended September 30, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CALIFORNIA FLORIDA MASSACHUSETTS MISSISSIPPI
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations --
Net investment income $ 26,176,138 $ 43,615,848 $ 17,915,854 $ 1,761,923
Net realized loss (23,050,795) (22,866,182) (15,667,434 ) (2,036,920)
Change in unrealized appreciation 33,475,523 54,420,669 23,987,414 3,242,877
------------ ------------ ------------ -----------
Net increase in net assets from
operations $ 36,600,866 $ 75,170,335 $ 26,235,834 $ 2,967,880
------------ ------------ ------------ -----------
Capital transactions --
Contributions $ 39,676,667 $ 64,327,943 $ 27,917,577 $ 4,982,661
Withdrawals (110,738,796) (199,418,295) (60,522,944 ) (8,434,232)
------------ ------------ ------------ -----------
Decrease in net assets resulting from
capital transactions $ (71,062,129) (135,090,352) $(32,605,367 ) $(3,451,571)
------------ ------------ ------------ -----------
Total decrease in net assets $ (34,461,263) $ (59,920,017) $ (6,369,533 ) $ (483,691)
NET ASSETS:
At beginning of year 445,131,401 772,123,153 308,539,780 29,476,651
------------ ------------ ------------ -----------
At end of year $ 410,670,138 $ 712,203,136 $302,170,247 $28,992,960
============ ============ ============ ===========
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NEW YORK OHIO WEST VIRGINIA
PORTFOLIO PORTFOLIO PORTFOLIO
------------- ------------- -------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations --
Net investment income $ 38,506,539 $ 18,465,329 $ 2,332,643
Net realized loss (19,277,660) (7,231,426 ) (1,158,097)
Change in unrealized appreciation 43,043,554 20,963,434 2,810,543
------------ ------------ -----------
Net increase in net assets from
operations $ 62,272,433 $ 32,197,337 $ 3,985,089
------------ ------------ -----------
Capital transactions --
Contributions $ 61,423,633 $ 24,237,228 $ 3,302,492
Withdrawals (126,606,533) (61,829,470 ) (6,925,830)
------------ ------------ -----------
Decrease in net assets resulting from
capital transactions $ (65,182,900) $(37,592,242 ) $(3,623,338)
------------ ------------ -----------
Total increase (decrease) in net
assets $ (2,910,467) $ (5,394,905 ) $ 361,751
NET ASSETS:
At beginning of year 655,646,776 324,411,553 40,473,310
------------ ------------ -----------
At end of year $ 652,736,309 $319,016,648 $40,835,061
============ ============ ===========
</TABLE>
See notes to financial statements
62
<PAGE> 63
SUPPLEMENTARY DATA
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CALIFORNIA PORTFOLIO FLORIDA PORTFOLIO
-------------------------------------------------- -----------------------------------------------
YEAR ENDED YEAR ENDED
-------------------------------------------------- -----------------------------------------------
SEPTEMBER 30, MARCH 31, SEPTEMBER 30,
---------------------------------- ----------- -----------------------------------------------
1996 1995 1994**** 1994*** 1996 1995 1994 1993*
-------- -------- -------- ----------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
RATIOS (As a percentage
of average daily net assets):
Net expenses (1) 0.57% 0.59% 0.57% + 0.55%+ 0.52% 0.55% 0.48% 0.47%+
Net expenses after
custodian fee
reduction 0.56% 0.58% -- -- 0.49% 0.52% -- --
Net investment income 5.93% 6.22% 6.09% + 5.72%+ 5.67% 5.94% 5.65% 5.53%+
NET ASSETS, end of year
(000 omitted) $370,590 $410,763 $445,131 $ 467,259 $624,374 $712,203 $772,123 $772,422
PORTFOLIO TURNOVER 14% 58% 40% 91% 51% 61% 57% 55%
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MASSACHUSETTS PORTFOLIO MISSISSIPPI PORTFOLIO
-------------------------------------------------- -----------------------------------------------
YEAR ENDED SEPTEMBER 30, YEAR ENDED SEPTEMBER 30,
-------------------------------------------------- -----------------------------------------------
1996 1995 1994 1993* 1996 1995 1994 1993**
-------- -------- -------- ----------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
RATIOS (As a percentage
of average
daily net assets):++
Net expenses (1) 0.55% 0.56% 0.51% 0.49%+ 0.29% 0.27% 0.05% 0.00%+
Net expenses after
custodian fee
reduction 0.54% 0.53% -- -- 0.26% 0.23% -- --
Net investment income 5.77% 6.00% 5.74% 5.72%+ 5.77% 5.97% 5.67% 4.49%+
NET ASSETS, end of year
(000 omitted) $281,129 $302,170 $308,540 $ 290,613 $ 25,280 $ 28,993 $ 29,477 $ 11,233
PORTFOLIO TURNOVER 51% 87% 53% 38% 12% 52% 38% 11%
</TABLE>
++The operating expenses of the Mississippi Portfolio reflect a reduction of the
investment adviser fee and/or an allocation of expenses to the Investment
Adviser. Had such actions not been taken, the ratios would have been as
follows:
<TABLE>
<S> <C> <C> <C> <C>
RATIOS (As a percentage of average daily net assets):
Expenses (1) 0.40% 0.39% 0.32% 0.25%+
Expenses after custodian fee reduction 0.37% 0.35% -- --
Net investment income 5.66% 5.85% 5.40% 4.24%+
</TABLE>
+ Annualized.
* For the period from the start of business, February 1, 1993, to September
30, 1993.
** For the period from the start of business, June 11, 1993, to September 30,
1993.
*** For the period from the start of business, May 3, 1993 to March 31, 1994.
**** For the six months ended September 30, 1994. The Portfolio changed its
fiscal year from March 31 to September 30, effective September 30, 1994.
(1) The expense ratios for the years ended September 30, 1996 and 1995 have
been adjusted to reflect a change in reporting requirements. The new
reporting guidelines require each Portfolio to increase its expense ratio
by the effect of any expense offset arrangements with its service
providers. The expense ratios for each of the periods ended on or before
September 30, 1994 have not been adjusted to reflect this change.
See notes to financial statements
63
<PAGE> 64
FINANCIAL STATEMENTS (continued)
SUPPLEMENTARY DATA
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NEW YORK PORTFOLIO OHIO PORTFOLIO
----------------------------------------------- -----------------------------------------------
YEAR ENDED SEPTEMBER 30, YEAR ENDED SEPTEMBER 30,
----------------------------------------------- -----------------------------------------------
1996 1995 1994 1993* 1996 1995 1994 1993*
-------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
RATIOS (As a percentage of
average daily net assets):
Net expenses (1) 0.52% 0.54% 0.48% 0.48%+ 0.57% 0.57% 0.51% 0.49%+
Net expenses after
custodian fee reduction 0.49% 0.51% -- -- 0.56% 0.55% -- --
Net investment income 5.64% 5.97% 5.70% 5.64%+ 5.69% 5.80% 5.61% 5.61%+
NET ASSETS, end of year (000
omitted) $604,530 $652,736 $655,647 $648,807 $292,671 $319,017 $324,412 $298,092
PORTFOLIO TURNOVER 48% 55% 47% 37% 35% 51% 31% 24%
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WEST VIRGINIA PORTFOLIO
-----------------------------------------------
YEAR ENDED SEPTEMBER 30,
-----------------------------------------------
1996 1995 1994 1993*
-------- -------- -------- --------
<S> <C> <C> <C> <C>
RATIOS (As a percentage of
average daily net assets):++
Net expenses (1) 0.42% 0.31% 0.10% 0.00%+
Net expenses after
custodian fee reduction 0.38% 0.29% -- --
Net investment income 5.41% 5.81% 5.52% 4.50%+
NET ASSETS, end of year (000
omitted) $ 39,501 $ 40,835 $ 40,473 $ 24,760
PORTFOLIO TURNOVER 43% 19% 39% 19%
</TABLE>
++The operating expenses of the West Virginia Portfolio reflect a reduction of
the investment adviser fee and/or an allocation of expenses to the Investment
Adviser. Had such actions not been taken, the ratios would have been as
follows:
<TABLE>
<S> <C> <C> <C>
RATIOS (As a percentage of
average daily net assets):
Expenses (1) 0.39% 0.33% 0.21%+
Expenses after custodian
fee reduction 0.37% -- --
Net investment income 5.73% 5.29% 4.30%+
+ Annualized.
* For the period from the start of business, February 1, 1993, to September 30, 1993.
** For the period from the start of business, June 11, 1993, to September 30, 1993.
(1) The expense ratios for the years ended September 30, 1996 and 1995 have been adjusted to reflect a change in
reporting requirements. The new reporting guidelines require each Portfolio to increase its expense ratio by the
effect of any expense offset arrangements with its service providers. The expense ratios for each of the periods
ended on or before September 30, 1994 have not been adjusted to reflect this change.
</TABLE>
See notes to financial statements
64
<PAGE> 65
Notes to Financial Statements
- --------------------------------------------------------------------------------
(1) SIGNIFICANT ACCOUNTING POLICIES
California Municipals Portfolio (California Portfolio), Florida Municipals
Portfolio (Florida Portfolio), Massachusetts Municipals Portfolio (Massachusetts
Portfolio), Mississippi Municipals Portfolio (Mississippi Portfolio), New York
Municipals Portfolio (New York Portfolio), Ohio Municipals Portfolio (Ohio
Portfolio), and West Virginia Municipals Portfolio (West Virginia Portfolio),
collectively the Portfolios, are registered under the Investment Company Act of
1940 as non-diversified open-end management investment companies. The Portfolios
were organized as trusts under the laws of the State of New York on May 1, 1992.
The Declarations of Trust permit the Trustees to issue interests in the
Portfolios. The following is a summary of significant accounting policies
consistently followed by the Portfolios in the preparation of their financial
statements. The policies are in conformity with generally accepted accounting
principles.
A. INVESTMENT VALUATIONS--Municipal bonds are normally valued on the basis of
valuations furnished by a pricing service. Taxable obligations, if any, for
which price quotations are readily available are normally valued at the mean
between the latest bid and asked prices. Futures contracts and options on
futures contracts listed on commodity exchanges are valued at closing settlement
prices. Over the counter options on futures contracts are normally valued at the
mean between the latest bid and asked prices. Short-term obligations, maturing
in sixty days or less, are valued at amortized cost, which approximates value.
Investments for which valuations or market quotations are unavailable are valued
at fair value using methods determined in good faith by or at the direction of
the Trustees.
B. INCOME--Interest income is determined on the basis of interest accrued,
adjusted for amortization of premium or discount when required for federal
income tax purposes.
C. INCOME TAXES--The Portfolios are treated as partnerships for Federal tax
purposes. No provision is made by the Portfolios for federal or state taxes on
any taxable income of the Portfolios because each investor in the Portfolios is
ultimately responsible for the payment of any taxes. Since some of the
Portfolios' investors are regulated investment companies that invest all or
substantially all of their assets in the Portfolios, the Portfolios normally
must satisfy the applicable source of income and diversification requirements
(under the Internal Revenue Code) in order for their respective investors to
satisfy them. The Portfolios will allocate at least annually among their
respective investors each investor's distributive share of the Portfolios' net
taxable (if any) and tax-exempt investment income, net realized capital gains,
and any other items of income, gain, loss, deductions or credit. Interest income
received by the Portfolios on investments in municipal bonds, which is
excludable from gross income under the Internal Revenue Code, will retain its
status as income exempt from federal income tax when allocated to each
Portfolio's investors. The portion of such interest, if any, earned on private
activity bonds issued after August 7, 1986, may be considered a tax preference
item for investors.
D. DEFERRED ORGANIZATION EXPENSES--Costs incurred by a Portfolio in connection
with its organization are being amortized on the straight-line basis over five
years.
E. FINANCIAL FUTURES CONTRACTS--Upon the entering of a financial futures
contract, a Portfolio is required to deposit ("initial margin") either in cash
or securities an amount equal to a certain percentage of the purchase price
indicated in the financial futures contract. Subsequent payments are made or
received by a Portfolio ("margin maintenance") each day, dependent on the daily
fluctuations in the value of the underlying security, and are recorded for book
purposes as unrealized gains or losses by a Portfolio. A Portfolio's investment
in financial futures contracts is designed only to hedge against anticipated
future changes in interest rates. Should interest rates move unexpectedly, a
Portfolio may not achieve the anticipated benefits of the financial futures
contract and may realize a loss.
F. OPTIONS ON FINANCIAL FUTURES CONTRACTS--Upon the purchase of a put option on
a financial futures contract by a Portfolio, the premium paid is recorded as an
investment, the value of which is marked-to-market daily. When a purchased
option expires, a Portfolio will realize a loss in the amount of the cost of the
option. When a Portfolio enters into a closing sales transaction, the Portfolio
will realize a gain or loss depending on whether the sales proceeds from the
closing sales transaction is greater or less than the cost of the option. When a
Portfolio exercises a put option, settlement is made in cash. The risk
associated with purchasing options is limited to the premium originally paid.
G. WHEN-ISSUED AND DELAYED DELIVERY TRANSACTIONS--The Portfolios may engage in
when-issued or delayed delivery transactions. The Portfolios record when-issued
securities on trade date and maintain security positions such that sufficient
liquid assets will be available to make payments for the securities purchased.
Securities purchased on a when-issued or delayed delivery basis are
marked-to-market daily and begin earning interest on settlement date.
H. OTHER--Investment transactions are accounted for on a trade date basis.
I. 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 assets and liabilities at
the date of the financial statements and the
65
<PAGE> 66
- --------------------------------------------------------------------------------
reported amounts of revenue and expense during the reporting period. Actual
results could differ from those estimates.
J. EXPENSE REDUCTION--Investors Bank & Trust Company (IBT) serves as custodian
of the Portfolios. Prior to November 10, 1995 IBT was an affiliate of EVM.
Pursuant to the respective custodian agreements, IBT receives a fee reduced by
credits which are determined based on the average daily cash balances each
Portfolio maintains with IBT. All significant credit balances used to reduce the
Portfolios' custodian fees are reported as a reduction of expenses in the
statements of operations.
- --------------------------------------------------------------------------------
(2) INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES
The investment adviser fee is earned by Boston Management and Research (BMR), a
wholly-owned subsidiary of Eaton Vance Management (EVM), as compensation for
management and investment advisory services rendered to each Portfolio.
The fee is based upon a percentage of average daily net assets plus a percentage
of gross income (i.e., income other than gains from the sale of securities). For
the year ended September 30, 1996, each Portfolio paid advisory fees as follows:
<TABLE>
<CAPTION>
PORTFOLIO AMOUNT EFFECTIVE RATE*
- ---------------------- ---------- ---------------
<S> <C> <C>
California $1,942,811 0.50%
Florida 3,123,150 0.46%
Massachusetts 1,343,099 0.46%
Mississippi 55,976 0.20%
New York 2,932,032 0.46%
Ohio 1,404,951 0.46%
West Virginia 95,361 0.24%
</TABLE>
* Advisory fees paid as a percentage of average daily net assets.
To enhance the net income of the Mississippi Portfolio, BMR made a reduction in
its fee in the amount of $27,990 for the year ended September 30, 1996. Except
as to Trustees of the Portfolios who are not members of EVM's or BMR's
organization, officers and Trustees receive remuneration for their services to
the Portfolios out of such investment adviser fee.
Certain of the officers and Trustees of the Portfolios are officers and
directors/trustees of the above organizations. Trustees of the Portfolio that
are not affiliated with the Investment Adviser may elect to defer receipt of all
or a percentage of their annual fees in accordance with the terms of the
Trustees Deferred Compensation Plan. For the year ended September 30, 1996, no
significant amounts have been deferred.
- --------------------------------------------------------------------------------
(3) INVESTMENTS
Purchases and sales of investments, other than U.S. Government securities,
purchased option transactions and short-term obligations, for the year ended
September 30, 1996 were as follows:
<TABLE>
<CAPTION>
CALIFORNIA
PORTFOLIO FLORIDA PORTFOLIO MASSACHUSETTS PORTFOLIO MISSISSIPPI PORTFOLIO
------------------ ----------------- ----------------------- ---------------------
<S> <C> <C> <C> <C>
Purchases $ 54,079,902 $ 342,367,214 $ 147,661,742 $ 3,314,865
Sales 106,027,565 450,625,807 169,737,557 7,067,480
</TABLE>
<TABLE>
<CAPTION>
NEW YORK PORTFOLIO OHIO PORTFOLIO WEST VIRGINIA PORTFOLIO
------------------ ----------------- -----------------------
<S> <C> <C> <C> <C>
Purchases $301,869,050 $107,686,903 $16,700,245
Sales 359,091,966 143,159,361 19,323,806
</TABLE>
66
<PAGE> 67
- --------------------------------------------------------------------------------
(4) FEDERAL INCOME TAX BASIS OF INVESTMENTS
The cost and unrealized appreciation (depreciation) in value of the investments
owned by each Portfolio at September 30, 1996, as computed on a federal income
tax basis, are as follows:
<TABLE>
<CAPTION>
CALIFORNIA FLORIDA MASSACHUSETTS MISSISSIPPI
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------ ------------ ------------- -----------
<S> <C> <C> <C> <C>
Aggregate Cost $337,396,359 $560,837,654 $259,803,177 $23,820,442
------------ ------------ ----------- ----------
Gross unrealized appreciation $ 26,461,163 $ 36,660,431 $ 16,636,591 $ 1,326,127
Gross unrealized depreciation 463,881 1,978,279 93,927 16,337
------------ ------------ ----------- ----------
Net unrealized appreciation $ 25,997,282 $ 34,682,152 $ 16,542,664 $ 1,309,790
============ ============ =========== ==========
</TABLE>
<TABLE>
<CAPTION>
NEW YORK OHIO WEST VIRGINIA
PORTFOLIO PORTFOLIO PORTFOLIO
------------ ------------ -------------
<S> <C> <C> <C> <C>
Aggregate Cost $559,386,220 $271,985,967 $ 37,359,901
------------ ------------ -------------
Gross unrealized appreciation $ 35,018,432 $ 12,978,340 $ 926,299
Gross unrealized depreciation 779,473 220,402 219,435
------------ ------------ -------------
Net unrealized appreciation
(depreciation) $ 34,238,959 $ 12,757,938 $ 706,864
============== ============== ================
</TABLE>
- --------------------------------------------------------------------------------
(5) LINE OF CREDIT
The Portfolios participate with other portfolios and funds managed by BMR and
EVM in a $120 million unsecured line of credit agreement with a bank. The line
of credit consists of a $20 million committed facility and a $100 million
discretionary facility. Each Portfolio may temporarily borrow up to 5% of its
total assets to satisfy redemption requests or settle transactions. Interest is
charged to each portfolio or fund based on its borrowings at an amount above
either the bank's adjusted certificate of deposit rate, a variable adjusted
certificate of deposit rate, or a federal funds effective rate. In addition, a
fee computed at an annual rate of 1/4 of 1% on the $20 million committed
facility and on the daily unused portion of the $100 million discretionary
facility is allocated among the participating portfolios and funds at the end of
each quarter.
For the year ended September 30, 1996, the Ohio Portfolio had an average daily
loan balance of $1,757,500 and the average interest rate was 7.43%. The maximum
loan balance outstanding at any month end during the year ended September 30,
1996 was $5,303,000 for the Ohio Portfolio. The remaining Portfolios did not
have any significant borrowings or allocated fees during the year ended
September 30, 1996.
67
<PAGE> 68
- --------------------------------------------------------------------------------
(6) FINANCIAL INSTRUMENTS
The Portfolios regularly trade in financial instruments with off-balance sheet
risk in the normal course of their investing activities to assist in managing
exposure to various market risks. These financial instruments include futures
contracts and may involve, to a varying degree, elements of risk in excess of
the amounts recognized for financial statement purposes.
The notional or contractual amounts of these instruments represent the
investment a Portfolio has in particular classes of financial instruments and
does not necessarily represent the amounts potentially subject to risk. The
measurement of the risks associated with these instruments is meaningful only
when all related and offsetting transactions are considered.
A summary of obligations under these financial instruments at September 30,
1996, were as follows:
<TABLE>
<CAPTION>
FUTURES CONTRACTS NET UNREALIZED
PORTFOLIO EXPIRATION DATE CONTRACTS POSITION DEPRECIATION
- -------------- ----------------- ------------------------ -------- --------------
<S> <C> <C> <C> <C>
California 12/96 300 U.S. Treasury Bonds Short $ 411,037
Florida 12/96 796 U.S. Treasury Bonds Short 1,417,470
Massachusetts 12/96 279 U.S. Treasury Bonds Short 308,728
Mississippi 12/96 21 U.S. Treasury Bonds Short 28,773
New York 12/96 519 U.S. Treasury Bonds Short 359,440
Ohio 12/96 272 U.S. Treasury Bonds Short 484,361
West Virginia 12/96 40 U.S. Treasury Bonds Short 85,863
</TABLE>
At September 30, 1996 each Portfolio had sufficient cash and/or securities to
cover margin requirements on open futures contracts.
68
<PAGE> 69
Independent Auditors' Report
- --------------------------------------------------------------------------------
TO THE TRUSTEES AND INVESTORS OF:
CALIFORNIA MUNICIPALS PORTFOLIO
FLORIDA MUNICIPALS PORTFOLIO
MASSACHUSETTS MUNICIPALS PORTFOLIO
MISSISSIPPI MUNICIPALS PORTFOLIO
NEW YORK MUNICIPALS PORTFOLIO
OHIO MUNICIPALS PORTFOLIO
WEST VIRGINIA MUNICIPALS PORTFOLIO
We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of California Municipals Portfolio, Florida
Municipals Portfolio, Massachusetts Municipals Portfolio, Mississippi Municipals
Portfolio, New York Municipals Portfolio, Ohio Municipals Portfolio, and West
Virginia Municipals Portfolio as of September 30, 1996, the related statements
of operations for the year then ended, the statements of changes in net assets
for each of the years ended September 30, 1996 and 1995 and the supplementary
data for each of the years in the four-year period ended September 30, 1996.
(For the California Municipals Portfolio, the supplementary data is for each of
the years in the three-year period ended September 30, 1996 and the period from
the start of business, May 3, 1993 to March 31, 1994). These financial
statements and supplementary data are the responsibility of the Trusts'
management. Our responsibility is to express an opinion on the financial
statements and supplementary data 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 supplementary
data 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 at
September 30, 1996, by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, such financial statements and supplementary data present fairly,
in all material respects, the financial position of California Municipals
Portfolio, Florida Municipals Portfolio, Massachusetts Municipals Portfolio,
Mississippi Municipals Portfolio, New York Municipals Portfolio, Ohio Municipals
Portfolio, and West Virginia Municipals Portfolio at September 30, 1996, the
results of their operations, the changes in their net assets and their
supplementary data for the respective stated periods in conformity with
generally accepted accounting principles.
DELOITTE & TOUCHE LLP
BOSTON, MASSACHUSETTS
NOVEMBER 1, 1996
69
<PAGE> 70
Investment Management
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
FUNDS OFFICERS INDEPENDENT TRUSTEES
THOMAS J. FETTER DONALD R. DWIGHT
President President, Dwight Partners, Inc.
Chairman, Newspaper of New England,
JAMES B. HAWKES Inc.
Vice President, Trustee SAMUEL L. HAYES, III
Jacob H. Schiff Professor of
ROBERT B. MACINTOSH Investment Banking, Harvard
Vice President University Graduate
School of Business Administration
JAMES L. O'CONNOR NORTON H. REAMER
Treasurer President and Director,
THOMAS OTIS United Asset Management Corporation
Secretary JOHN L. THORNDIKE
Director,
Fiduciary Company Incorporated
JACK L. TREYNOR
Investment Adviser
and Consultant
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
PORTFOLIOS OFFICERS INDEPENDENT TRUSTEES
THOMAS J. FETTER DONALD R. DWIGHT
President and Portfolio Manager of Florida President, Dwight Partners, Inc.
and Ohio Municipals Portfolios Chairman, Newspaper of New England,
JAMES B. HAWKES Inc.
Vice President, Trustee SAMUEL L. HAYES, III
ROBERT B. MACINTOSH Jacob H. Schiff Professor of
Vice President and Portfolio Manager Investment Banking, Harvard
of Massachusetts Municipals Portfolio University Graduate
NICOLE ANDERES School of Business Administration
Vice President and Portfolio Manager NORTON H. REAMER
of New York and Rhode Island President and Director,
Municipals Portfolios United Asset Management Corporation
TIMOTHY T. BROWSE JOHN L. THORNDIKE
Vice President and Portfolio Manager Director,
of West Virginia Municipals Portfolio Fiduciary Company Incorporated
CYNTHIA J. CLEMSON JACK L. TREYNOR
Vice President and Portfolio Manager Investment Adviser
of California and Mississippi and Consultant
Municipals Portfolios
JAMES L. O'CONNOR
Treasurer
THOMAS OTIS
Secretary
</TABLE>
70
<PAGE> 71
- --------------------------------------------------------------------------------
PORTFOLIO INVESTMENT ADVISER
Boston Management and Research
24 Federal Street
Boston, MA 02110
FUND ADMINISTRATOR
Eaton Vance Management
24 Federal Street
Boston, MA 02110
PRINCIPAL UNDERWRITER
Eaton Vance Distributors, Inc.
24 Federal Street
Boston, MA 02110
(617) 482-8260
CUSTODIAN
Investors Bank & Trust Company
89 South Street
P.O. Box 1537
Boston, MA 02205-1537
TRANSFER AGENT
First Data Investor Services Group, Inc.
Attn: Eaton Vance Funds
P.O. Box 5123
Westborough, MA 01581-5123
INDEPENDENT AUDITORS
Deloitte & Touche LLP
125 Summer Street
Boston, MA 02110
71
<PAGE> 72
This report must be preceded or accompanied by a current prospectus which
contains more complete information on the Fund, including its distribution plan,
sales charges and expenses. Please read the prospectus carefully before you
invest or send money.
EATON VANCE
MUNICIPALS TRUST
24 FEDERAL STREET
BOSTON, MA 02110
T-7TFCSRC-11/96
