SCUDDER GLOBAL FUND INC, 497, 1997-09-05

SCUDDER GLOBAL FUND INC
497, 1997-09-05

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SCUDDER [LOGO]
Pure No-Load(TM) Funds

A Collection Of
Prospectuses
For Five
Scudder Global Growth Funds

This Outer Cover Not Part of Prospectus
<PAGE>

This combined prospectus sets forth concisely the information a prospective
investor should know before investing in the following open-end funds: Scudder
Global Fund and Scudder Global Discovery Fund, each a series of Scudder Global
Fund, Inc.; Scudder Greater Europe Growth Fund, Scudder International Fund and
Scudder International Growth and Income Fund, each a series of Scudder
International Fund, Inc. Please retain it for future reference.

If you require more detailed information, Statements of Additional Information
dated March 1, 1997 for Scudder Global Discovery Fund and Scudder Greater Europe
Growth Fund; November 1, 1996 for Scudder Global Fund; August 1, 1997 for
Scudder International Fund; and June 5, 1997 for Scudder International Growth
and Income Fund, as amended from time to time, may be obtained without charge by
writing Scudder Investor Services, Inc., Two International Place, Boston, MA
02110-4103 or calling 1-800-225-2470. The Statements, which are incorporated by
reference into this prospectus, have been filed with the Securities and Exchange
Commission and are available along with other related materials on the SEC's
Internet Web site (http://www.sec.gov).

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

Contents--see page 11.

NOT FDIC-INSURED
MAY LOSE VALUE
NO BANK GUARANTEE

Scudder Global Fund
- -------------------------------------
November 1, 1996
as Revised July 1, 1997

Scudder Global Discovery
Fund
- -------------------------------------
March 1, 1997

Scudder Greater Europe
Growth Fund
- -------------------------------------
March 1, 1997

Scudder International Fund
- -------------------------------------
August 1, 1997

Scudder International Growth and Income Fund
- -------------------------------------
June 5, 1997

Five pure no-load(TM) (no sales charges) mutual funds offering a broad range of
worldwide equity opportunities.
<PAGE>

Expense information

Scudder Global Fund

How to compare a Scudder pure no-load(TM) fund

This information is designed to help you understand the various costs and
expenses of investing in Scudder Global Fund. By reviewing this table and those
in other mutual funds' prospectuses, you can compare the Fund's fees and
expenses with those of other funds. With Scudder's pure no-load(TM) funds, you
pay no commissions to purchase or redeem shares, or to exchange from one fund to
another. As a result, all of your investment goes to work for you.

1) Shareholder transaction expenses: Expenses charged directly to your
individual account in the Fund for various transactions.

Sales commissions to purchase shares (sales load) NONE
Commissions to reinvest dividends NONE
Redemption fees NONE*
Fees to exchange shares NONE

2) Annual Fund operating expenses: Expenses paid by the Fund before it
distributes its net investment income, expressed as a percentage of the
Fund's average daily net assets for the fiscal year ended June 30, 1996.

Investment management fee 0.96%
12b-1 fees NONE
Other expenses 0.38%
-----
Total Fund operating expenses 1.34%
=====
Example

Based on the level of total Fund operating expenses listed above, the total
expenses relating to a $1,000 investment, assuming a 5% annual return and
redemption at the end of each period, are listed below. Investors do not pay
these expenses directly; they are paid by the Fund before it distributes its net
investment income to shareholders. (As noted above, the Fund has no redemption
fees of any kind.)

1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
$14 $42 $73 $161

See "Fund organization--Investment adviser" for further information about the
investment management fee. This example assumes reinvestment of all dividends
and distributions and that the percentage amounts listed under "Annual Fund
operating expenses" remain the same each year. This example should not be
considered a representation of past or future expenses or return. Actual Fund
expenses and return vary from year to year and may be higher or lower than those
shown.

* You may redeem by writing or calling the Fund. If you wish to receive your
redemption proceeds via wire, there is a $5 wire service fee. For
additional information, please refer to "Transaction information--Redeeming
shares."

2
<PAGE>

Expense information

Scudder Global Discovery Fund

How to compare a Scudder pure no-load(TM) fund

This information is designed to help you understand the various costs and
expenses of investing in Scudder Global Discovery Fund. By reviewing this table
and those in other mutual funds' prospectuses, you can compare the Fund's fees
and expenses with those of other funds. With Scudder's pure no-load(TM) funds,
you pay no commissions to purchase or redeem shares, or to exchange from one
fund to another. As a result, all of your investment goes to work for you.

1) Shareholder transaction expenses: Expenses charged directly to your
individual account in the Fund for various transactions.

Sales commissions to purchase shares (sales load) NONE
Commissions to reinvest dividends NONE
Redemption fees NONE*
Fees to exchange shares NONE

Investment management fee 1.09%**
12b-1 fees NONE
Other expenses 0.51%
-----
Total Fund operating expenses 1.60%**
=====
Example

1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
$16 $50 $87 $190

** For the fiscal year ended October 31, 1996, the Adviser did not charge a
portion of its fee, with the result that the total annualized expenses of
the Fund did not exceed 1.60%. If the Adviser had charged that portion of
its fee, Fund expenses would have been: investment management fee 1.10%,
other expenses 0.51% and total operating expenses 1.61%.

3
<PAGE>

Expense information

Scudder Greater Europe Growth Fund

How to compare a Scudder pure no-load(TM) fund

This information is designed to help you understand the various costs and
expenses of investing in Scudder Greater Europe Growth Fund. By reviewing this
table and those in other mutual funds' prospectuses, you can compare the Fund's
fees and expenses with those of other funds. With Scudder's pure no-load(TM)
funds, you pay no commissions to purchase or redeem shares, or to exchange from
one fund to another. As a result, all of your investment goes to work for you.

1) Shareholder transaction expenses: Expenses charged directly to your
individual account in the Fund for various transactions.

Sales commissions to purchase shares (sales load) NONE
Commissions to reinvest dividends NONE
Redemption fees NONE*
Fees to exchange shares NONE

Investment management fee 1.00%
12b-1 fees NONE
Other expenses 0.97%
-----
Total Fund operating expenses 1.97%**
=====
Example

1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
$20 $62 $106 $230

** Until February 28, 1997, the Adviser waived a portion of its investment
management fee to the extent necessary so that the total annualized
expenses of the Fund did not exceed 1.50% of average daily net assets.
Expenses shown above are restated to reflect what the Fund would have paid
during the fiscal year ended October 31, 1996, absent such waiver.

4
<PAGE>

Expense information

Scudder International Fund

How to compare a Scudder pure no-load(TM) fund

This information is designed to help you understand the various costs and
expenses of investing in Scudder International Fund. By reviewing this table and
those in other mutual funds' prospectuses, you can compare the Fund's fees and
expenses with those of other funds. With Scudder's pure no-load(TM) funds, you
pay no commissions to purchase or redeem shares, or to exchange from one fund to
another. As a result, all of your investment goes to work for you.

1) Shareholder transaction expenses: Expenses charged directly to your
individual account in the Fund for various transactions.

Sales commissions to purchase shares (sales load) NONE
Commissions to reinvest dividends NONE
Redemption fees NONE*
Fees to exchange shares NONE

Investment management fee 0.82%
12b-1 fees NONE
Other expenses 0.33%
-----
Total Fund operating expenses 1.15%
=====

Example

1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
$12 $37 $63 $140

5
<PAGE>

Expense information

Scudder International Growth and Income Fund

How to compare a Scudder pure no-load(TM) fund

This information is designed to help you understand the various costs and
expenses of investing in Scudder International Growth and Income Fund. By
reviewing this table and those in other mutual funds' prospectuses, you can
compare the Fund's fees and expenses with those of other funds. With Scudder's
pure no-load(TM) funds, you pay no commissions to purchase or redeem shares, or
to exchange from one fund to another. As a result, all of your investment goes
to work for you.

1) Shareholder transaction expenses: Expenses charged directly to your
individual account in the Fund for various transactions.

Sales commissions to purchase shares (sales load) NONE
Commissions to reinvest dividends NONE
Redemption fees NONE*
Fees to exchange shares NONE

2) Annual Fund operating expenses: Estimated expenses paid by the Fund
before it distributes its net investment income, expressed as a percentage
of the Fund's average daily net assets for the year.

Investment management fee (after waiver) 0.00%**
12b-1 fees NONE
Other expenses (after waiver) 1.75%**
-----
Total Fund operating expenses (after waiver) 1.75%**
=====
Example

Based on the estimated level of total Fund operating expenses listed above, the
total expenses relating to a $1,000 investment, assuming a 5% annual return and
redemption at the end of each period, are listed below. Investors do not pay
these expenses directly; they are paid by the Fund before it distributes its net
investment income to shareholders. (As noted above, the Fund has no redemption
fees of any kind.)

1 Year 3 Years
------ -------
$18 $55

** Until June 30, 1998, the Adviser and certain of its subsidiaries have
agreed to waive all or portions of their fees payable by the Fund to the
extent necessary so that the total annualized expenses of the Fund do not
exceed 1.75% of average daily net assets. If the Adviser and its
subsidiaries had not agreed to waive all or portions of their fees, it is
estimated that annualized Fund expenses would be: investment management fee
1.00%, other expenses 2.14% and total operating expenses 3.14% for the
initial fiscal year.

6
<PAGE>

Financial highlights

Scudder Global Fund

The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the audited financial
statements.

If you would like more detailed information concerning the Fund's performance, a
complete portfolio listing and audited financial statements are available in the
Fund's Annual Report dated June 30, 1996 and may be obtained without charge by
writing or calling Scudder Investor Services, Inc.

FOR THE PERIOD
JULY 23, 1986
YEARS ENDED JUNE 30, (COMMENCEMENT OF
OPERATIONS)
TO JUNE 30,
1996 1995 1994(e) 1993 1992 1991 1990 1989 1988 1987
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value,
-------------------------------------------------------------------------------------------
beginning of period ..... $25.64 $23.93 $21.63 $19.56 $18.06 $20.36 $17.64 $14.47 $15.42 $12.00
-------------------------------------------------------------------------------------------
Income from investment
operations:
Net investment income ..... .24 .25 .23 .15 .19 .40 .19 .19 .18 .05
Net realized and
unrealized gain (loss)
on investment
transactions ............ 3.94 1.91 2.57 2.42 2.28 (1.50) 3.28 3.20 (.82) 3.37
Total from investment -------------------------------------------------------------------------------------------
operations .............. 4.18 2.16 2.80 2.57 2.47 (1.10) 3.47 3.39 (.64) 3.42
-------------------------------------------------------------------------------------------
Less distributions from:
Net investment income ..... (.25) (.11) (.24) (.16) (.31) (.37) (.20) (.14) (.06) -
Net realized gains
from investment
transactions ............ (.84) (.34) (.26) (.34) (.66) (.83) (.55) (.08) (.25) -
-------------------------------------------------------------------------------------------
Total distributions ....... (1.09) (.45) (.50) (.50) (.97) (1.20) (.75) (.22) (.31) -
-------------------------------------------------------------------------------------------
Net asset value, end of -------------------------------------------------------------------------------------------
period ............ $28.73 $25.64 $23.93 $21.63 $19.56 $18.06 $20.36 $17.64 $14.47 $15.42
- --------------------------------------------------------------------------------------------------------------------
TOTAL RETURN (%) .......... 16.65 9.11 12.99 13.45 14.09 (5.20) 20.00 23.90 (4.45) 28.50**
RATIOS AND SUPPLEMENTAL
DATA
Net assets, end of
period ($ millions) ..... 1,368 1,168 1,096 577 371 268 257 91 81 102
Ratio of operating
expenses, to average
daily net assets (%) ... 1.34 1.38 1.45 1.48 1.59 1.70 1.81 1.98 1.71(c) 1.84*(a)
Ratio of net investment
income to average
daily net assets (%) .... .84 1.03 .97 .90 1.09 2.21 1.77 1.22 1.23 .63*
Portfolio turnover
rate (%) ................ 29.1 44.4 59.7 64.9 44.6 85.0(d) 38.3 30.7 53.8 32.2*
Average commission rate
paid (b) ................ $.0272 $ - $ - $ - $ - $ - $ - $ - $ - $ -

</TABLE>

(a) The Adviser did not impose all of its management fee during the period July
23, 1986 (commencement of operations) to December 31, 1986, amounting to
$.01 per share.
(b) Average commission rate paid per share of common and preferred stocks is
calculated for fiscal years ending on or after June 30, 1996.
(c) The Adviser absorbed a portion of the Fund's expenses exclusive of
management fees, amounting to $.03 per share.
(d) The portfolio turnover rate on equity securities and debt securities was
62.7% and 174.4%, respectively, based on average monthly equity holdings
and average monthly debt holdings.
(e) Per share amounts have been calculated using weighted average shares
outstanding.
* Annualized
** Not annualized.

7
<PAGE>

Financial highlights

Scudder Global Discovery Fund

The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the audited financial
statements.

The Fund changed its name from Scudder Global Small Company Fund on March 6,
1996. If you would like more detailed information concerning the Fund's
performance, a complete portfolio listing and audited financial statements are
available in the Fund's Annual Report dated October 31, 1996 and may be obtained
without charge by writing or calling Scudder Investor Services, Inc.

For the Period
September 10,
1991
(commencement of
operations) to
Years Ended October 31, October 31,
1996 (a) 1995 1994 1993 1992 1991
---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $17.54 $16.27 $16.14 $12.05 $11.92 $12.00
---------------------------------------------------------------------------------------------------------------------
Income from investment operations:
Net investment income (loss) (.04) (.03) (.02) .04 .07 .01
Net realized and unrealized gain 3.59 1.38 .48 4.24 .08 (.09)
(loss) on investment transactions
Total from investment operations 3.55 1.35 .46 4.28 .15 (.08)
---------------------------------------------------------------------------------------------------------------------
Less distributions:
From net investment income (.20) -- -- (.07) (.02) --
In excess of net investment income -- -- (.18) -- -- --
From net realized gains on (.44) (.08) (.15) (.12) -- --
investment transactions
Total distributions (.64) (.08) (.33) (.19) (.02) --
---------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $20.45 $17.54 $16.27 $16.14 $12.05 $11.92
---------------------------------------------------------------------------------------------------------------------
Total Return (%) 20.97 8.32 2.80 36.04 1.26 (.67)*
Ratios and Supplemental Data
Net assets, end of period ($ 351 255 256 198 55 9
millions)
Ratio of operating expenses, net to 1.60 1.69 1.70 1.50 1.50 1.50**
average daily net assets (%)
Ratio of operating expenses before 1.60 1.69 1.76 2.01 2.53 15.34**
expense reductions, to average
daily net assets (%)
Ratio of net investment income (.20) (.12) (.28) .53 .78 2.47**
(loss) to average daily net
assets (%)
Portfolio turnover rate (%) 63.0 43.7 45.8 54.6 23.4 --
Average commission rate paid (b) $.0026 $ -- $ -- $ -- $ -- $ --
</TABLE>

(a) Based on monthly average shares outstanding during the period.
(b) Average commission rate paid per share of common and preferred stocks is
calculated for fiscal years beginning on or after September 1, 1995.
* Not annualized
** Annualized

8
<PAGE>

Financial highlights

Scudder Greater Europe Growth Fund

The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the audited financial
statements.

If you would like more detailed information concerning the Fund's performance, a
complete portfolio listing and audited financial statements are available in the
Fund's Annual Report dated October 31, 1996 and may be obtained without charge
by writing or calling Scudder Investor Services, Inc.

<TABLE>
<CAPTION>
For the Period
October 10, 1994
(commencement of
operations) to
Years Ended October 31, October 31,
1996 (a) 1995 1994
----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net asset value, beginning of period........... $13.99 $12.18 $12.00
---------------------------------------------------
Income from investment operations:
Net investment income.......................... .13 .13 .01
Net realized and unrealized gain on investment
transactions................................ 3.33 1.70 .17
---------------------------------------------------
Total from investment operations............... 3.46 1.83 .18
---------------------------------------------------
Less distributions from:
Net investment income.......................... (.11) (.02) --
Net realized gains on investment transactions.. (.14) -- --
---------------------------------------------------
Total distributions............................ (.25) (.02) --
---------------------------------------------------
Net asset value, end of period................. $17.20 $13.99 $12.18
- ------------------------------------------------------------------------------------------------------
Total Return (%) (b)........................... 25.11 15.06 1.50**
Ratios and Supplemental Data
Net assets, end of period ($ millions)......... 120 41 8
Ratio of operating expenses, net to average
daily net assets (%)........................ 1.50 1.50 1.50*
Ratio of operating expenses before expense
reductions, to average daily net assets (%). 1.97 2.74 11.46*
Ratio of net investment income to average daily
net assets (%).............................. .82 1.25 2.40*
Portfolio turnover rate (%).................... 39.0 27.9 --
Average commission rate paid (c)............... $.0509 $ -- $ --
</TABLE>

(a) Based on monthly average shares outstanding during the period.
(b) Total returns would have been lower had certain expenses not been reduced.
(c) Average commission rate paid per share of common and preferred stocks is
calculated for fiscal years beginning on or after September 1, 1995.
* Annualized
** Not annualized

9
<PAGE>

Financial highlights

Scudder International Fund

The following table includes selected data for a share outstanding throughout
each period (a) and other performance information derived from the audited
financial statements.

If you would like more detailed information concerning the Fund's performance, a
complete portfolio listing and audited financial statements are available in the
Fund's Annual Report dated March 31, 1997 and may be obtained without charge by
writing or calling Scudder Investor Services, Inc.

<TABLE>
<CAPTION>
Years Ended March 31,
1997 1996 1995 1994 1993 1992 1991 1990 1989 1988
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of
---------------------------------------------------------------------------------------
period ........................ $45.71 $39.72 $42.96 $35.69 $34.36 $34.69 $37.00 $34.79 $33.43 $44.05
---------------------------------------------------------------------------------------
Income from investment operations:
Net investment income ............ .30 .38 .21 .31 .38 .44 .80 .49 .40 .45
Net realized and unrealized gain
(loss) on investment
transactions .................. 4.53 7.19 (1.03) 7.74 2.64 (.37) (.39) 5.30 4.15 (.86)
Total from investment
---------------------------------------------------------------------------------------
operations .................... 4.83 7.57 (.82) 8.05 3.02 .07 .41 5.79 4.55 (.41)
---------------------------------------------------------------------------------------
Less distributions:
From net investment income ....... (1.28) (.40) -- (.63) (.83) -- (.74) (.43) (.13) (.82)
In excess of net investment income -- -- -- (.06) -- -- -- -- -- --
From net realized gains on
investment transactions ....... (1.19) (1.18) (2.42) (.09) (.86) (.40) (1.98) (3.15) (3.06) (9.39)
---------------------------------------------------------------------------------------
Total distributions .............. (2.47) (1.58) (2.42) (.78) (1.69) (.40) (2.72) (3.58) (3.19) (10.21)
---------------------------------------------------------------------------------------
Net asset value, end of
---------------------------------------------------------------------------------------
period ........................ $48.07 $45.71 $39.72 $42.96 $35.69 $34.36 $34.69 $37.00 $34.79 $33.43
- ---------------------------------------------------------------------------------------------------------------------------
Total Return (%) ................. 10.74 19.25 (2.02) 22.69 9.12 .18 1.46 17.08 14.34 (.47)
Ratios and Supplemental Data
Net assets, end of period
($ millions) .................... 2,583 2,515 2,192 2,198 1,180 933 929 783 550 559
Ratio of operating expenses to
average net assets (%) ........ 1.15 1.14 1.19 1.21 1.26 1.30 1.24 1.18 1.22 1.21
Ratio of net investment income to
average net assets (%) ........ .64 .86 .48 .75 1.13 1.25 2.22 1.33 1.20 1.16
Portfolio turnover rate (%) ...... 35.8 45.2 46.3 39.9 29.2 50.4 70.1 49.4 48.3 54.8
Average commission rate paid (b) . $.0002 -- -- -- -- -- -- -- -- --
</TABLE>

(a) Based on monthly average shares outstanding during the period.
(b) Average commission rate paid per share of common and preferred stocks is
calculated for fiscal years ending on or after March 31, 1997.

10
<PAGE>

A message from Scudder's chairman

Scudder, Stevens & Clark, Inc., investment adviser to the Scudder Family of
Funds, was founded in 1919. We offered America's first no-load mutual fund in
1928. Today, we manage in excess of $125 billion for many private accounts and
over 50 mutual fund portfolios. We manage the mutual funds in a special program
for the American Association of Retired Persons, as well as the fund options
available through Scudder Horizon Plan, a tax-advantaged variable annuity. We
also advise The Japan Fund and nine closed-end funds that invest in countries
around the world.

The Scudder Family of Funds is designed to make investing easy
and less costly. It includes money market, tax free, income and growth funds as
well as IRAs, 401(k)s, Keoghs and other retirement plans.

Services available to all shareholders include toll-free access to the
professional service representatives of Scudder Investor Relations, easy
exchange among funds, shareholder reports, informative newsletters and the
walk-in convenience of Scudder Investor Centers.

All Scudder mutual funds are pure no-load(TM). This means you pay no commissions
to purchase or redeem your shares or to exchange from one fund to another. There
are no "12b-1" fees either, which many other funds now charge to support their
marketing efforts. All of your investment goes to work for you. We look forward
to welcoming you as a shareholder.

The Funds

Five pure no-load(TM) (no sales charges) mutual funds offering a broad range of
worldwide equity opportunities:

o Scudder Global Fund
o Scudder Global Discovery Fund
o Scudder Greater Europe Growth Fund
o Scudder International Fund
o Scudder International Growth and Income Fund

Contents

Introduction..........................................12
Scudder Global Fund...................................12
Scudder Global Discovery Fund.........................14
Scudder Greater Europe Growth Fund....................16
Scudder International Fund............................18
Scudder International Growth and
Income Fund........................................19
Special risk considerations...........................21
Additional information about policies
and investments....................................22
Distribution and performance
information........................................28
Fund organization.....................................29
Transaction information...............................31
Shareholder benefits..................................35
Purchases.............................................38
Exchanges and redemptions.............................39
Investment products and services......................41
How to contact Scudder........................Back cover

11
<PAGE>

Introduction

Scudder Global Fund, Scudder Global Discovery Fund, Scudder Greater Europe
Growth Fund, Scudder International Fund and Scudder International Growth and
Income Fund (each a "Fund," collectively, the "Funds"), are mutual funds advised
by Scudder, Stevens & Clark, Inc. (the "Adviser"). The five Funds' prospectuses
are presented together so you can understand their important differences and
decide which Fund or combination of Funds is most suitable for your investment
needs.

Each Fund offers all the benefits of the Scudder Family of Funds. Scudder,
Stevens & Clark, Inc. manages a diverse family of pure no-load(TM) funds and
provides a wide range of services to help investors meet their investment needs.
Please refer to "Investment products and services" for additional information.

Except as otherwise indicated, each Fund's investment objective and policies are
not fundamental and may be changed without a vote of shareholders. If there is a
change in investment objectives, shareholders should consider whether the Fund
remains an appropriate investment in light of their current financial position
and needs. There can be no assurance that each Fund's objective will be met.

Scudder Global Fund

Investment objective and policies

Scudder Global Fund seeks long-term growth of capital through a diversified
portfolio of marketable securities, primarily equity securities, including
common stocks, preferred stocks and debt securities convertible into common
stocks. The Fund invests on a worldwide basis in equity securities of companies
which are incorporated in the U.S. or in foreign countries. It also may invest
in the debt securities of U.S. and foreign issuers. Income is an incidental
consideration.

Investments

The Fund invests in companies that the Adviser believes will benefit from global
economic trends, promising technologies or products and specific country
opportunities resulting from changing geopolitical, currency or economic
relationships. It is expected that investments will be spread broadly around the
world. The Fund will be invested usually in securities of issuers located in at
least three countries, one of which may be the U.S. The Fund may be invested
100% in non-U.S. issues, and for temporary defensive purposes may be invested
100% in U.S. issues, although under normal circumstances it is expected that
both foreign and U.S. investments will be represented in the Fund's portfolio.
It is expected that investments will include companies of varying size as
measured by assets, sales or capitalization.

The Fund generally invests in equity securities of established companies listed
on U.S. or foreign securities exchanges but also may invest in securities traded
over-the-counter. It also may invest in debt securities convertible into common
stock, and convertible and nonconvertible preferred stock, and fixed-income
securities of governments, government agencies, supranational agencies and
companies when the Adviser believes the potential for appreciation will equal or
exceed that available from investments in equity securities. These debt and
fixed-income securities will be predominantly investment-grade securities, that
is, those rated Aaa, Aa, A or Baa by Moody's Investors Service, Inc. ("Moody's")
or AAA, AA, A or BBB by Standard & Poor's ("S&P") or those of equivalent quality
as determined by the Adviser. The Fund may not invest more than 5% of its total
assets in debt securities rated Baa or below by Moody's, or BBB or below by S&P
or deemed by the Adviser to be of comparable quality (see

12
<PAGE>

"Additional information about policies and investments--Risk factors").

The Fund may invest in zero coupon securities which pay no cash income and are
issued at substantial discounts from their value at maturity. When held to
maturity, their entire income, which consists of accretion of discount, comes
from the difference between the issue price and their value at maturity.
Fixed-income securities also may be held for temporary defensive purposes when
the Adviser believes market conditions so warrant and for temporary investment.
Similarly, the Fund may invest in cash equivalents (including foreign money
market instruments, such as bankers' acceptances, certificates of deposit,
commercial paper, short-term government and corporate obligations and repurchase
agreements) for temporary defensive purposes and for liquidity. The Fund may
invest in closed-end investment companies holding foreign securities. In
addition, the Fund may engage in strategic transactions.

Why invest in the Fund?

The management of the Fund believes that there is substantial opportunity for
long-term capital growth from a professionally managed portfolio of securities
selected from the U.S. and foreign equity markets. This global investment
framework seeks to take advantage of the investment opportunities created by the
global economy. The world has become highly integrated in economic, industrial
and financial terms. Companies increasingly operate globally as they purchase
raw materials, produce and sell their products and raise capital. As a result,
international trends such as movements in currency and trading relationships are
becoming more important to many industries than purely domestic influences. To
understand a company's business, it is frequently more important to understand
how it is linked to the world economy than whether or not it is, for example, a
U.S., French or Swiss company. Just as a company takes a global perspective in
deciding where to operate, so too may an investor benefit from looking globally
in deciding which industries are growing, which producers are efficient and
which companies' shares are undervalued. The Fund affords the investor access to
opportunities wherever they arise, without being constrained by the location of
a company's headquarters or the trading market for its shares.

The Fund is designed for investors seeking worldwide equity opportunities in
developed, newly industrialized and developing countries (some of these
developing countries are located in Latin America and Africa). Like consumers
who seek to buy a good product wherever it is made, the Fund seeks to find
investment opportunities regardless of location. Because the Fund's portfolio
invests globally, it provides the potential to augment returns available from
the U.S. stock market. In addition, since U.S. and foreign markets do not always
move in step with each other, a global portfolio will be more diversified than
one invested solely in U.S. securities.

Investing directly in foreign securities is usually impractical for most
investors because it presents complications and extra costs. Investors often
find it difficult to arrange purchases and sales, to obtain current information,
to hold securities in safekeeping and to convert the value of their investments
from foreign currencies into dollars. The Fund manages these problems for the
investor. With a single investment, the investor has a diversified worldwide
investment portfolio which is managed actively by experienced professionals. The
Adviser has had many years of experience investing in foreign markets and
dealing with trading, custody and currency transactions around the world. The
Adviser has the benefit of information it receives from worldwide sources and
believes the Fund affords investors an efficient and cost-effective method of
investing worldwide.

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Scudder Global Discovery Fund

Investment objective and policies

Scudder Global Discovery Fund seeks above-average capital appreciation over the
long term by investing primarily in the equity securities of small companies
located throughout the world. The Fund is designed for investors looking for
above-average appreciation potential (when compared with the overall domestic
stock market as reflected by Standard & Poor's 500 Composite Price Index) and
the benefits of investing globally, but who are willing to accept above-average
stock market risk, the impact of currency fluctuation and little or no current
income.

Investments in small companies

In pursuit of its objective, the Fund generally invests in small, rapidly
growing companies which offer the potential for above-average returns relative
to larger companies, yet are frequently overlooked and thus undervalued by the
market. The Fund has the flexibility to invest in any region of the world. It
can invest in companies based in emerging markets, typically in the Far East,
Latin America and lesser developed countries in Europe, as well as in firms
operating in developed economies, such as those of the United States, Japan and
Western Europe. The Adviser invests the Fund's assets in companies it believes
offer above-average earnings, cash flow or asset growth potential. It also
invests in companies which may receive greater market recognition over time. The
Adviser believes that these factors offer significant opportunity for long-term
capital appreciation. The Adviser evaluates investments for the Fund from both a
macroeconomic and microeconomic perspective, using fundamental analysis,
including field research. The Adviser analyzes the growth potential and relative
value of possible investments. When evaluating an individual company, the
Adviser takes into consideration numerous factors, including the depth and
quality of management; a company's product line, business strategy and
competitive position; research and development efforts; financial strength,
including degree of leverage; cost structure; revenue and earnings growth
potential; price-earnings ratios and other stock valuation measures.
Secondarily, the Adviser weighs the attractiveness of the country and region in
which a company is located.

Under normal circumstances the Fund invests at least 65% of its total assets in
the equity securities of small companies. While the Adviser believes that
smaller, lesser-known companies can offer greater growth potential than larger,
more established firms, the former also involve greater risk and price
volatility. To help reduce risk, the Fund expects, under normal market
conditions, to diversify its portfolio widely by company, industry and country.
The Fund will limit investments in securities of issuers located in Eastern
Europe to 5% of its total assets. The Fund intends to allocate investments among
at least three countries at all times, one of which may be the United States.

The Fund may invest up to 35% of its total assets in equity securities of larger
companies located throughout the world and in debt securities if the Adviser
determines that the capital appreciation of debt securities is likely to exceed
the capital appreciation of equity securities. The Fund may purchase
investment-grade bonds, those rated Aaa, Aa, A or Baa by Moody's or AAA, AA, A
or BBB by S&P or, if unrated, of equivalent quality as determined by the
Adviser. The Fund may also invest up to 5% of its net assets in debt securities
rated below investment-grade (see "Additional information about policies and
investments -- Risk factors").

The Fund invests primarily in companies whose individual equity market
capitalization would place them in the same size range as companies in
approximately the lowest 20% of world market capitalization as represented by

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<PAGE>

the Salomon Brothers Broad Market Index, an index comprised of equity securities
of more than 7,500 small-, medium- and large-sized companies based in 22 markets
around the globe. Based on this policy, the companies represented in the Fund's
Portfolio typically will have individual equity market capitalizations of
between approximately $50 million and $2 billion, although the Fund will be free
to invest in smaller capitalization issues. Furthermore, the median market
capitalization of the Fund will not exceed $750 million.

The equity securities in which the Fund may invest consist of common stocks,
preferred stocks (either convertible or nonconvertible), rights and warrants.
These securities may be listed on the U.S. or foreign securities exchanges or
traded over-the-counter. For capital appreciation purposes, the Fund may
purchase notes, bonds, debentures, government securities and zero coupon bonds
(any of which may be convertible or nonconvertible). The Fund may invest in
foreign securities and American Depositary Receipts which may be sponsored or
unsponsored. The Fund may also invest in closed-end investment companies holding
foreign securities, enter into repurchase agreements, purchase securities on a
when-issued or forward delivery basis, and engage in strategic transactions. For
temporary defensive purposes, the Fund may, during periods in which conditions
in securities markets warrant, invest without limit in cash and cash
equivalents. It is impossible to predict for how long such alternative
strategies will be utilized. More information about investment techniques is
provided under "Additional information about policies and investments."

Why invest in the Fund?

Scudder Global Discovery Fund offers convenient, low-cost access to a
diversified, global portfolio of equity securities issued by smaller companies.
The Fund's experienced, professional management can help investors take
advantage of a rapidly changing world economy. Unlike small company funds which
limit themselves to U.S. investments, the Fund seeks investment opportunities
wherever they arise. The Fund enjoys the flexibility to invest in all
established markets, as well as in newly opened or newly industrialized
economies around the world. Because the Fund operates globally, it may, under
certain market conditions, augment the returns available from a comparable
investment in the U.S. market alone.

The Fund focuses specifically on small companies believed to have favorable
long-term growth prospects. Small companies can be attractive because they are
frequently sources of new technologies and services, often compete with larger
companies on the basis of lower labor costs and often grow faster than larger
firms. Their smaller size often allows them to respond rapidly to changing
business conditions. Also, small companies may not be closely followed by
securities analysts, so they may reward the investor with the patience and
knowledge to carefully seek them out and understand them. This can mean
significant long-term opportunity as these companies achieve greater recognition
over time.

While the Fund is broadly diversified, it is not a complete investment program.
However, adding shares of the Fund to a portfolio can increase diversification,
which should moderate overall portfolio risk.

The Fund is appropriate for investors who can accept the greater risks of
global, small company investing for the potentially greater rewards. Investing
directly in foreign securities is usually impractical for individual investors.
Investors frequently find it difficult to arrange purchases and sales, obtain
current information about companies abroad, hold securities in safekeeping, and
convert their profits from foreign currencies to U.S. dollars. The Fund makes it

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<PAGE>

easy for investors to take advantage of small company opportunities on a global
basis and benefit from the Adviser's experience researching and managing
investments both in the U.S. and abroad.

Scudder Greater Europe Growth Fund

Investment objective and policies

Scudder Greater Europe Growth Fund seeks long-term growth of capital through
investments primarily in the equity securities of European companies. Although
the focus is on long-term growth, the Fund may provide current income
principally through holdings in dividend-paying securities.

Greater Europe includes both the industrialized nations of Western Europe and
the less wealthy or developed countries in Southern and Eastern Europe. Within
this diverse area, the Fund seeks to benefit from accelerating economic growth
transformation and deregulation taking hold. These developments involve, among
other things, increased privatizations and corporate restructurings, the
reopening of equity markets and economies in Eastern Europe, further broadening
of the European Community, and the implementation of economic policies to
promote non-inflationary growth. The Fund invests in companies it believes are
well placed to benefit from these and other structural and cyclical changes now
underway in this region of the world.

Investments

The Fund will invest, under normal market conditions, at least 80% of its assets
in the equity securities of European companies. The Fund defines a European
company as follows:

o A company organized under the laws of a European country or for which the
principal securities trading market is in Europe; or

o A company, wherever organized, where at least 50% of the company's
non-current assets, capitalization, gross revenue or profit in its most
recent fiscal year represents (directly or indirectly through subsidiaries)
assets or activities located in Europe.

The Fund expects the majority of its equity assets to be in the more established
and liquid markets of Western and Southern Europe. These more established
Western and Southern European countries include: Austria, Belgium, Denmark,
Finland, France, Germany, Iceland, Ireland, Italy, Luxembourg, the Netherlands,
Norway, Spain, Sweden, Switzerland, and the United Kingdom. To enhance return
potential, however, the Fund may pursue investment opportunities in the less
wealthy nations of Southern Europe, currently Greece, Portugal and Turkey, and
the former communist countries of Eastern Europe, including countries once part
of the Soviet Union. The Fund may invest in other countries of Europe when their
markets become sufficiently developed, in the opinion of the Fund's Adviser.

The Fund intends to allocate its investments among at least three countries at
all times and does not expect to concentrate investments in any particular
industry. The Fund's equity investments are common stock, preferred stock
(convertible or non-convertible), depositary receipts (sponsored or unsponsored)
and warrants. These may be restricted securities. Equity securities may also be
purchased through rights. Securities may be listed on securities exchanges,
traded over-the-counter or have no organized market. In addition, the Fund may
engage in strategic transactions.

The Fund may invest, under normal market conditions, up to 20% of its total
assets in European debt securities. Capital appreciation in debt securities may
arise from a favorable change in relative interest rate levels or in the
creditworthiness of issuers. Within this 20% limit, the Fund may hold debt
securities which are unrated, rated, or the equivalent of those rated below
investment-grade (commonly referred to as "junk bonds"); that is, rated below

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<PAGE>

Baa by Moody's or below BBB by S&P. See "Additional information about policies
and investments--Debt securities."

The Fund may invest in when-issued securities and convertible securities and may
enter into repurchase agreements. The Fund may also invest in closed-end
investment companies that invest primarily in Europe.

The Fund does not expect to borrow for investment purposes.

When, in the opinion of the Adviser, market conditions warrant, the Fund may
hold foreign or U.S. debt instruments as well as cash or cash equivalents,
including foreign and domestic money market instruments, short-term government
and corporate obligations, and repurchase agreements without limit for temporary
defensive purposes and up to 20% to maintain liquidity. See "Additional
information about policies and investments--Risk factors."

Investment strategy

The Adviser will conduct regional, country, industry and company analysis in
search of investments likely to benefit from economic, political, industrial and
other changes occurring across Europe. In investigating these four areas, the
Adviser relies heavily on fundamental analysis supplemented by field research.

Regional and country analysis involves evaluating such factors as projected
levels of economic growth, changes in interest rates and inflation, trade
patterns, fluctuations in currencies and political developments within and among
nations. Along with this macroeconomic analysis, the Adviser weighs the
prospects for individual industries and companies. The focus will be on looking
for companies with strong management teams, solid finances, leading products,
franchises or technologies, and market strategies well positioned to benefit
from growth and developments in the region.

Why invest in the Fund?

The goal of the Fund is to provide investors with long-term growth of capital by
participating in investments, primarily in the form of equity securities,
located throughout Greater Europe, which encompasses both the industrialized
nations of Western Europe and the less wealthy or developed markets in Southern
and Eastern Europe. Greater Europe is a region of more than 3.8 million square
miles, 800 million consumers, and has a total wealth unsurpassed by any other
continent. While this region is diverse in culture, politics and industrial
development, it is taking steps to promote greater economic integration and
cooperation.

In selecting investments for the Fund, the Adviser seeks out well-managed
companies, both large multinationals and smaller local firms, standing to
benefit from structural and cyclical changes now underway in Europe. Economic
growth transformation and renewal are taking place in different areas and
different ways including: a trend toward privatizations and corporate
restructurings; deregulation and modernization of securities markets; reduction
in trade barriers and currency restrictions; global expansion by major European
companies of both exports and production; steps toward the broadening of the
European Community; economic reform and modernization of the former communist
countries of Eastern Europe; expected further growth of an already large middle
class and a general increase in consumer confidence; and anticipated labor
market restructurings. The Adviser believes that active management, based on
disciplined fundamental research, will yield promising investment opportunities
for long-term capital appreciation.

The Fund seeks to provide appreciation over time with average international
equity fund risk. It is designed as a long-term investment and not for
short-term trading purposes, and should not be considered a complete investment
program. While the Fund entails stock market and other risks, movements in its

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<PAGE>

share price may have a low correlation with movements in the U.S. markets, so
adding shares of the Fund to an investor's portfolio may increase the investor's
portfolio diversification, and thus may moderate overall portfolio risk.

The Fund's investments are generally denominated in foreign currencies. The
strength or weakness of the U.S. dollar against these currencies is responsible
for part of the Fund's investment performance. If the dollar falls in value
relative to the German deutschemark, for example, the dollar value of a German
stock held in the portfolio will rise even though the price of the stock remains
unchanged. Conversely, if the dollar rises in value relative to the
deutschemark, the dollar value of the German stock will fall.

Investing directly in foreign securities is usually impractical for individual
investors. Investors frequently find it difficult and expensive to arrange
purchases and sales, obtain current market, industry or corporate information,
hold securities for safekeeping and convert profits from foreign currencies to
U.S. dollars. The Fund manages these tasks for the investor. The Adviser has had
long experience in dealing in foreign markets and believes the Fund affords a
convenient and cost-effective method of investing in the European markets.

Scudder International Fund

Investment objective and policies

Scudder International Fund seeks long-term growth of capital primarily through a
diversified portfolio of marketable foreign equity securities. These securities
are selected primarily to permit the Fund to participate in non-United States
companies and economies with prospects for growth. The Fund invests in
companies, wherever organized, which do business primarily outside the United
States. The Fund intends to diversify investments among several countries and to
have represented in the portfolio, in substantial proportions, business
activities in not less than three different countries. The Fund does not intend
to concentrate investments in any particular industry.

Investments

The Fund generally invests in equity securities of established companies, listed
on foreign exchanges, which the Adviser believes have favorable characteristics.

When the Adviser believes that it is appropriate to do so in order to achieve
the Fund's investment objective of long-term capital growth, the Fund may invest
up to 20% of its total assets in debt securities. Such debt securities include
debt securities of foreign governments, supranational organizations and private
issuers, including bonds denominated in the European Currency Unit (ECU).
Portfolio debt investments will be selected on the basis of, among other things,
yield, credit quality, and the fundamental outlooks for currency and interest
rate trends in different parts of the globe, taking into account the ability to
hedge a degree of currency or local bond price risk. The Fund may purchase
"investment-grade" bonds, which are those rated Aaa, Aa, A or Baa by Moody's or
AAA, AA, A or BBB by S&P or, if unrated, judged by the Adviser to be of
equivalent quality. The Fund may also invest up to 5% of its total assets in
debt securities which are rated below investment- grade (see "Additional
information about policies and investments--Risk factors").

In addition, the Fund may enter into repurchase agreements, and invest in
illiquid and restricted securities, and may engage in securities lending and
strategic transactions, which may include derivatives.

When the Adviser determines that exceptional conditions exist abroad, the Fund
may, for temporary defensive purposes, invest all or a portion of its assets in
Canadian or U.S. Government obligations or currencies, or securities of
companies incorporated in and having their principal activities in Canada or the

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<PAGE>

U.S. It is impossible to accurately predict for how long such alternative
strategies may be utilized.

Why invest in the Fund?

The Fund is designed for investors seeking investment opportunity and
diversification through an actively managed portfolio of foreign securities.

One reason that some investors may wish to invest overseas is that certain
foreign economies may grow more rapidly than the U.S. economy and may offer
opportunities for achieving superior investment returns. Another reason is that
foreign stock and bond markets do not always move in step with each other or
with the U.S. markets. A portfolio invested in a number of markets worldwide
will be better diversified than one which is subject to the movements of a
single market.

Another benefit of the Fund is that it eliminates the complications and extra
costs associated with direct investment in individual foreign securities.
Individuals investing directly in foreign stocks may find it difficult to make
purchases and sales, to obtain current information, to hold securities in
safekeeping, and to convert the value of their investments from foreign
currencies into U.S. dollars. The Fund manages these tasks for the investor.
With a single investment, the investor has a diversified international
investment portfolio, which is actively managed by experienced professionals.
The Adviser has had long experience in dealing in foreign markets and with
brokers and custodian banks around the world. The Adviser also has the benefit
of an established information network and believes the Fund affords a convenient
and cost-effective method of investing internationally.

The Fund's investments are generally denominated in foreign currencies. The
strength or weakness of the U.S. dollar against these currencies is responsible
for part of the Fund's investment performance. If the dollar falls in value
relative to the Japanese yen, for example, the dollar value of a Japanese stock
held in the portfolio will rise even though the price of the stock remains
unchanged. Conversely, if the dollar rises in value relative to the yen, the
dollar value of the Japanese stock will fall.

Scudder International Growth and Income Fund

Investment objective and policies

Scudder International Growth and Income Fund seeks long-term growth of capital
and current income primarily from foreign equity securities. The Fund invests
generally in common stocks of established companies listed on foreign exchanges,
which offer prospects for growth of earnings while paying relatively high
current dividends. The Fund can also invest in other types of equity securities,
including preferred stocks and securities convertible into common stock. The
Fund can invest throughout the world, but will emphasize investments in
developed economies other than the U.S.

In the opinion of the Adviser, foreign capital markets provide investors with
opportunities to participate in the economic growth taking place outside the
U.S., which should translate into positive stock market performance over the
long term. In addition, the Adviser believes that international investing offers
the benefits of diversification, which can lower the overall price volatility of
an investor's portfolio.

While the Fund offers the potential for price appreciation and dividend income,
it also involves various types of risk. The Fund is designed as a long term
investment to be part of an overall diversified portfolio, not as a complete
investment program. The Fund's net asset value (price) can fluctuate with
changes in world stock market levels, political developments, movements in
currencies, investment flows and other factors. (See "Additional information
about policies and investments--Risk factors").

Investments

In pursuing its dual objective, at least 80% of the Fund's net assets will be
invested in the equity securities of established non-U.S. companies. The Fund

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<PAGE>

generally invests in equity securities of established companies listed on
foreign securities exchanges, but also may invest in securities traded
over-the-counter. The Fund's equity investments include common stock,
convertible and non-convertible preferred stock, sponsored and unsponsored
depository receipts, and warrants.

The Fund intends to diversify investments among several countries and normally
to have invested in securities of at least three different countries other than
the U.S. The Fund will invest primarily in securities of issuers in the 21
developed foreign countries included in the Morgan Stanley Capital International
(MSCI) World ex-US Index, but may invest in "emerging markets." The Fund
considers "emerging markets" to include any country that is defined as an
emerging or developing economy by any one of the International Bank for
Reconstruction and Development (i.e., the World Bank), the International Finance
Corporation or the United Nations or its authorities. It is expected that the
Fund's investments will include companies of varying size as measured by assets,
sales or market capitalization.

Under normal conditions, the Fund may also invest up to 20% of its net assets in
debt securities convertible into common stock and fixed-income securities of
governments, government agencies, supranational agencies and private issuers
when the Adviser believes the potential for appreciation and income will equal
or exceed that available from investments in equity securities. These securities
will predominantly be "investment grade" securities, which are those rated Aaa,
Aa, A, or Baa by Moody's or AAA, AA, A or BBB by S&P or if unrated, judged by
the Adviser to be of equivalent quality. The Fund may also invest up to 5% of
its total assets in debt securities which are rated below investment grade (see
"Additional information about policies and investments-- Risk factors").

The Fund may also hold up to 20% of its net assets in U.S. and foreign fixed
income securities for temporary defensive purposes when the Adviser believes
market conditions so warrant. Similarly, the Fund may invest up to 20% of its
net assets in cash or cash equivalents including domestic and foreign money
market instruments, short-term government and corporate obligations and
repurchase agreements under normal circumstances and without limit for temporary
defensive purposes and to maintain liquidity. In addition, the Fund may engage
in strategic transactions, which may include derivatives.

Investment process

The Adviser applies a disciplined, multi-part investment approach for selecting
stocks for the Fund. The first stage of this process involves analyzing the pool
of foreign dividend-paying securities, primarily from the world's more mature
markets, and targeting stocks that have high relative yields compared to the
average for their markets. In the Adviser's opinion, this group of
higher-yielding stocks offers the potential for returns that is greater than or
equal to the average market return, with price volatility that is lower than the
overall market volatility. The Adviser believes that these potentially favorable
risk and return characteristics exist because the higher dividends offered by
these stocks act as a "cushion" when markets are volatile and because the stocks
with higher yields tend to have more attractive valuations (e.g., lower
price-to-earning ratios and lower price-to-book ratios).

The second stage of portfolio construction involves a fundamental analysis of
each company's financial strength, profitability, projected earnings,
competitive positioning, and ability of management. During this step, the
Adviser's research team identifies what it believes are the most promising

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<PAGE>

stocks for the Fund's portfolio.

The third stage of the investment process involves diversifying the portfolio
among different industry sectors. The key element of this stage is evaluating
how the stocks in different sectors react to economic factors such as interest
rates, inflation, Gross Domestic Product, and consumer spending, and then
attaining a proper balance of stocks in these sectors based on the Adviser's
economic forecast.

The fourth and final stage of this ongoing process is diversifying the portfolio
among different countries. The Adviser will seek to have broad country
representation, favoring those countries that it believes have sound economic
conditions and open markets. The Fund's strategy is to manage risk and create
opportunity at each of its four stages in the investment process, starting with
the focus on stocks with high relative yields.

Why invest in the Fund?

The Fund is designed as a convenient, low cost way for investors to participate
in the opportunities for growth of capital and current income afforded by
investing in dividend-paying stocks in foreign markets. Certain foreign
economies may grow more rapidly than the U.S. economy and may offer
opportunities to achieve superior investment returns. Also, foreign stock
markets do not always move in step with each other or with the U.S. market. In
the opinion of the Adviser, a portfolio invested in a number of markets
worldwide will be better diversified than one which is subject to the movements
of a single market.

The Fund's income-oriented strategy and its focus on well-established companies
in developed markets may make it appropriate for investors seeking lower share
price volatility than many other international funds.

Investors who prefer investments that pay dividends, which can act as a
"cushion" in volatile markets, can get those benefits as well as gain
international diversification with the Fund.

Individuals investing directly in foreign stocks may find it difficult to make
purchases and sales, to obtain current information, to hold securities in
safekeeping, and to convert the value of their investments from foreign
currencies into U.S. dollars. The Fund manages these tasks for the investor.
With a single investment, the Adviser believes that the investor has a
diversified international management portfolio, which is managed actively by
experienced professionals. The Adviser has had many years of experience
investing in foreign markets and dealing with trading, custody, and currency
transactions around the world.

The Fund's investments are generally denominated in foreign currencies. The
strength or weakness of the U.S. dollar against these currencies is responsible
for part of the Fund's investment performance. If the dollar falls in value
relative to the Japanese yen, for example, the dollar value of a Japanese stock
held in the portfolio will rise even though the price of the stock remains
unchanged. Conversely, if the dollar rises in value relative to the yen, the
dollar value of the Japanese stock will fall.

Special risk considerations

Global and international investing involves economic and political
considerations not typically found in U.S. markets. These considerations include
changes in exchange rates and exchange rate controls (which may include
suspension of the ability to transfer currency from a given country), costs
incurred in conversions between currencies, non-negotiable brokerage
commissions, less publicly available information, different accounting
standards, lower trading volume and greater market volatility, the difficulty of
enforcing obligations in other countries, less securities regulation, different
tax provisions (including withholding on dividends paid to a Fund), war,

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<PAGE>

expropriation, political and social instability, and diplomatic developments.

Further, the settlement period of securities transactions in foreign markets may
be longer than in domestic markets. These considerations generally are more of a
concern in developing countries. For example, the possibility of political
upheaval and the dependence on foreign economic assistance may be greater in
these countries than in developed countries. The Adviser seeks to mitigate the
risks associated with these considerations through diversification and active
professional management.

There is typically less publicly available information concerning foreign and
smaller companies than for domestic and larger, more established companies. Some
small companies have limited product lines, distribution channels and financial
and managerial resources. Also, because smaller companies normally have fewer
shares outstanding than larger companies and trade less frequently, it may be
more difficult for the Fund to buy and sell significant amounts of such shares
without an unfavorable impact on prevailing market prices. Some of the companies
in which the Fund may invest may distribute, sell or produce products which have
recently been brought to market and may be dependent on key personnel with
varying degrees of experience.

Each Fund is designed for long-term investors who can accept international
investment risk. Since the Funds normally will be invested in both U.S. and
foreign securities markets, changes in a Fund's share price may have a low
correlation with movements in the U.S. markets. A Fund's share price will
reflect the movements of both the different stock and bond markets in which it
is invested and the currencies in which the investments are denominated. As with
any long-term investment, the value of shares when sold may be higher or lower
than when purchased. Because of the Funds' investment policies and the
investment considerations discussed above, investment in shares of a Fund should
not be considered a complete investment program. Please see "Additional
information about policies and investments--Risk factors."

Additional information about policies and investments

Investment restrictions

Each Fund has adopted certain fundamental policies which may not be changed
without a vote of shareholders and which are designed to reduce the Funds'
investment risk.

Each Fund may not borrow money except as a temporary measure for extraordinary
or emergency purposes. Each Fund may not make loans except through the lending
of portfolio securities, the purchase of debt securities or through repurchase
agreements.

Scudder International Growth and Income Fund may not invest more than 15% of its
net assets (taken at market value) in securities which are considered to be
illiquid.

A complete description of these and other policies and restrictions is contained
under "Investment Restrictions" in each Fund's Statement of Additional
Information.

Common stocks

Under normal circumstances, each Fund invests primarily in common stocks. Common
stock is issued by companies to raise cash for business purposes and represents
a proportionate interest in the issuing companies. Therefore, a Fund
participates in the success or failure of any company in which it holds stock.
The market values of common stock can fluctuate significantly, reflecting the
business performance of the issuing company, investor perception and general
economic or financial market movements. Smaller companies are especially
sensitive to these factors and may even become valueless. Despite the risk of
price volatility, however, common stocks also offer the greatest potential for
gain on investment, compared to other classes of financial assets such as bonds

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<PAGE>

or cash equivalents.

Convertible securities

Each of the Funds, with the exception of Scudder International Fund, may invest
in convertible securities which may offer higher income than the common stocks
into which they are convertible. The convertible securities in which each Fund
may invest consist of bonds, notes, debentures and preferred stocks which may be
converted or exchanged at a stated or determinable exchange ratio into
underlying shares of common stock. Prior to their conversion, convertible
securities may have characteristics similar to both nonconvertible debt
securities and equity securities.

When-issued securities

Scudder Greater Europe Growth Fund may purchase equity and debt securities on a
when-issued or forward delivery basis, for payment and delivery at a later date.
The price and yield are generally fixed on the date of commitment to purchase.
During the period between purchase and settlement, no interest accrues to the
Fund. At the time of settlement, the market value of the security may be more or
less than the purchase price.

Illiquid and restricted securities

Each Fund may invest a portion of its assets in securities for which there is
not an active trading market, or which have resale restrictions ("restricted
securities"). These types of securities generally offer a higher return than
more readily marketable securities, but carry the risk that a Fund may not be
able to dispose of them at an advantageous time or price. Some restricted
securities purchased by a Fund, however, may be considered liquid despite resale
restrictions, since they can be sold to other qualified institutional buyers
under a rule of the Securities and Exchange Commission (Rule 144A). Upon
approval from the Funds' Boards of Directors, the Adviser may determine which
Rule 144A securities will be considered liquid.

Repurchase agreements

As a means of earning income for periods as short as overnight, each Fund may
enter into repurchase agreements with selected banks and broker/dealers. Under a
repurchase agreement, a Fund acquires securities, subject to the seller's
agreement to repurchase them at a specified time and price. Scudder Greater
Europe Growth Fund may also enter into repurchase commitments for investment
purposes for periods of 30 days or more. Such commitments involve investment
risk similar to that of debt securities. Please see "Risk factors--Repurchase
Agreements" for more information.

Securities lending

Upon approval from the Board of Directors, Scudder International Fund and
Scudder International Growth and Income Fund may lend portfolio securities to
registered broker/dealers or other financial institutions as a means of
increasing their income. These loans may not exceed 30% of Scudder International
Fund's, or 33 1/3% of Scudder International Growth and Income Fund's total
assets taken at market value. Loans of portfolio securities for Scudder
International Fund will be secured continuously by collateral consisting of U.S.
Government securities or fixed-income obligations. Loans of portfolio securities
for Scudder International Growth and Income Fund will be secured continuously by
collateral consisting of cash, U.S. Government securities, or liquid high grade
debt obligations. Collateral is maintained at all times in an amount at least
equal to the current market value of the loaned securities. Each Fund will earn
any interest or dividends paid on the loaned securities and may share with the
borrower some of the income received on the collateral for the loan, or will be
paid a premium for the loan.

Special situation securities

From time to time, Scudder Global Discovery Fund may invest in equity or debt
securities issued by companies that are determined by the Adviser to possess

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"special situation" characteristics. In general, a special situation company is
a company whose securities are expected to increase in value solely by reason of
a development particularly or uniquely applicable to the company. Developments
that may create special situations include, among others, a liquidation,
reorganization, recapitalization or merger, material litigation, technological
breakthrough and new management or management policies. The principal risk
associated with investments in special situation companies is that the
anticipated development thought to create the special situation may not occur
and the investments therefore may not appreciate in value or may decline in
value.

Strategic Transactions and derivatives

Each of the Funds may, but are not required to, utilize various other investment
strategies as described below to hedge various market risks (such as interest
rates, currency exchange rates and broad or specific equity or fixed-income
market movements), to manage the effective maturity or duration of fixed-income
securities in each Fund's portfolio or to enhance potential gain. These
strategies may be executed through the use of derivative contracts. Such
strategies are generally accepted as a part of modern portfolio management and
are regularly utilized by many mutual funds and other institutional investors.
Techniques and instruments may change over time as new instruments and
strategies are developed or regulatory changes occur.

In the course of pursuing these investment strategies, each Fund may purchase
and sell exchange-listed and over-the-counter put and call options on
securities, equity and fixed-income indices and other financial instruments,
purchase and sell financial futures contracts and options thereon, enter into
various interest rate transactions such as swaps, caps, floors or collars and
enter into various currency transactions such as currency forward contracts,
currency futures contracts, currency swaps or options on currencies or currency
futures (collectively, all the above are called "Strategic Transactions").

Strategic Transactions may be used without limit to attempt to protect against
possible changes in the market value of securities held in or to be purchased
for each Fund's portfolio resulting from securities markets or currency exchange
rate fluctuations, to protect the Funds' unrealized gains in the value of their
portfolio securities, to facilitate the sale of such securities for investment
purposes, to manage the effective maturity or duration of fixed-income
securities in each Fund's portfolio, or to establish a position in the
derivatives markets as a temporary substitute for purchasing or selling
particular securities. Some Strategic Transactions may also be used to enhance
potential gain although no more than 5% of each Fund's assets will be committed
to Strategic Transactions entered into for non-hedging purposes. Any or all of
these investment techniques may be used at any time and in any combination, and
there is no particular strategy that dictates the use of one technique rather
than another, as use of any Strategic Transaction is a function of numerous
variables including market conditions. The ability of the Funds to utilize these
Strategic Transactions successfully will depend on the Adviser's ability to
predict pertinent market movements, which cannot be assured. Each Fund will
comply with applicable regulatory requirements when implementing these
strategies, techniques and instruments. Strategic Transactions involving
financial futures and options thereon will be purchased, sold or entered into
only for bona fide hedging, risk management or portfolio management purposes and
not for speculative purposes. Please refer to "Risk factors--Strategic
Transactions and derivatives" for more information.

Risk factors

Each Fund's risks are determined by the nature of the securities held and the
portfolio management strategies used by the Adviser. The following are

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<PAGE>

descriptions of certain risks related to the investments and techniques that a
Fund may use from time to time. A complete description of these and other risk
factors can be found in each Fund's Statement of Additional Information. Other
Funds may invest to a limited extent in the investments described below, please
refer to each Fund's "Investment objective(s) and policies" section above for
additional information.

Convertible securities. While convertible securities generally offer lower
yields than nonconvertible debt securities of similar quality, their prices may
reflect changes in the value of the underlying common stock. Convertible
securities generally entail less risk than the issuer's common stock.

Debt securities. Scudder Global Fund may invest no more than 5% of its total
assets in debt securities rated BBB or Baa (investment-grade) or below, or in
unrated securities. Scudder Global Discovery Fund may invest no more than 5% of
its net assets in debt securities rated below investment-grade. Scudder Greater
Europe Growth Fund may invest up to 20% of its total assets in debt securities
which are unrated, rated or the equivalent of those rated below
investment-grade. All three Funds may invest in securities which are rated as
low as C by Moody's or D by S&P at the time of purchase.

Scudder International Fund may invest no more than 5% of its total assets in
debt securities which are rated below investment-grade and may invest in
securities which are rated D by S&P or, if unrated, are of equivalent quality.

Scudder International Growth and Income Fund may invest no more than 5% of its
net assets in debt securities which are rated below investment-grade and may
invest in securities which are rated D by S&P or, if unrated, are of equivalent
quality.

Securities rated below Baa by Moody's and below BBB by S&P are commonly referred
to as "junk bonds." Moody's considers bonds it rates Baa to have speculative
elements as well as investment-grade characteristics. Securities rated C by
Moody's or D by S&P may be in default with respect to payment of principal and
interest. In addition, the trading market for these securities is generally less
liquid than for higher rated securities and a Fund may have difficulty disposing
of these securities at the time it wishes to do so. The lower the quality of
such debt securities, the greater their risks render them like equity
securities. Also, longer maturity bonds tend to fluctuate more in price as
interest rates change than do short-term bonds, providing both opportunity and
risk.

Non-diversified investment company. Scudder Greater Europe Growth Fund is
classified as a non-diversified investment company under the Investment Company
Act of 1940 (the "1940 Act"), which means that the Fund is not limited by the
1940 Act in the proportion of its assets that it may invest in the obligations
of a single issuer. The investment of a large percentage of the Fund's assets in
the securities of a small number of issuers may cause the Fund's share price to
fluctuate more than that of a diversified investment company.

Zero coupon securities. Zero coupon securities are subject to greater market
value fluctuations from changing interest rates than debt obligations of
comparable maturities which make current cash distributions of interest.

Illiquid and restricted securities. The absence of a trading market can make it
difficult to ascertain a market value for illiquid or restricted securities.
Disposing of illiquid or restricted securities may involve time-consuming
negotiation and legal expenses, and it may be difficult or impossible for a Fund
to sell them promptly at an acceptable price.

Repurchase agreements. If the seller under a repurchase agreement becomes
insolvent, a Fund's right to dispose of the securities may be restricted, or the
value of the securities may decline before a Fund is able to dispose of them.

25
<PAGE>

In the event of the commencement of bankruptcy or insolvency proceedings with
respect to the seller of the securities before repurchase of the securities
under a repurchase agreement, a Fund may encounter delay and incur costs before
being able to sell the securities.

Securities lending. From time to time Scudder International Fund and Scudder
International Growth and Income Fund may lend their portfolio securities to
registered broker/dealers or other financial institutions as described above.
The risks of lending portfolio securities, as with other extensions of secured
credit, consist of possible delays in receiving additional collateral or in the
recovery of the securities or possible loss of rights in the collateral should
the borrower fail financially. Loans will be made to registered broker/dealers
or other financial institutions deemed by the Adviser to be of good standing and
will not be made unless, in the judgment of the Adviser, the consideration to be
earned from such loans would justify the risk.

Foreign securities. Investments in foreign securities involve special
considerations due to more limited information, higher brokerage costs,
different accounting standards, thinner trading markets, and the likely impact
of foreign taxes on the income and gains from securities. They may also entail
certain other risks, such as the possibility of one or more of the following:
imposition of dividend or interest withholding or confiscatory taxes; currency
blockages or transfer restrictions; expropriation, nationalization or other
adverse political or economic developments; less government supervision and
regulation of securities exchanges, brokers and listed companies; and the
difficulty of enforcing obligations in other countries. Purchases of foreign
securities are usually made in foreign currencies and, as a result, a Fund may
incur currency conversion costs and may be affected favorably or unfavorably by
changes in the value of foreign currencies against the U.S. dollar. Further, it
may be more difficult for a Fund's agents to keep currently informed about
corporate actions which may affect the prices of portfolio securities.
Communications between the U.S. and foreign countries may be less reliable than
within the U.S., increasing the risk of delayed settlements of portfolio
transactions or loss of certificates for portfolio securities. Certain markets
may require payment for securities before delivery. A Fund's ability and
decisions to purchase and sell portfolio securities may be affected by laws or
regulations relating to the convertibility and repatriation of assets. Some
countries restrict the extent to which foreigners may invest in their securities
markets. All of the risks discussed above regarding foreign securities may be of
greater concern with respect to securities of issuers in emerging markets.

Currency movements. Purchases of foreign securities are usually made in foreign
currencies and, as a result, a Fund may incur currency conversion costs and may
be affected favorably or unfavorably by changes in the value of foreign
currencies against the U.S. dollar. Should the U.S. dollar appreciate against
foreign currencies, then the value of a Fund's securities holdings would
depreciate, all other things being equal. If the reverse is true, then a Fund's
holdings would appreciate in value.

Borrowing. Although the principal of a Fund's borrowing will be fixed, a Fund's
assets may change in value during the time a borrowing is outstanding,
increasing exposure to capital risk.

Investing in small companies. There is typically less publicly available
information concerning foreign and smaller companies than for domestic and
larger, more established companies. Some small companies have limited product
lines, distribution channels and financial and managerial resources. Also,
because smaller companies normally have fewer shares outstanding than larger
companies and trade less frequently, it may be more difficult for a Fund to buy
and sell significant amounts of such shares without an unfavorable impact on

26
<PAGE>

prevailing market prices. Some of the companies in which a Fund may invest may
distribute, sell or produce products which have recently been brought to market
and may be dependent on key personnel with varying degrees of experience.

Investing in Europe. To the extent that a Fund may invest in Europe, the Fund's
performance is susceptible to political, social and economic factors affecting
issuers in European countries. Such factors may include, but are not limited to:
growth of GDP or GNP, rate of inflation, capital reinvestment, resource
self-sufficiency and balance of payments position, as well as interest and
monetary exchange rates among European countries.

Eastern European countries and certain Southern European countries are
considered to be emerging markets. Securities traded in certain emerging
European markets may be subject to additional risks due to political and
economic reforms including efforts to decentralize the economic decision-making
process and move toward a market-oriented economy. Additionally, the
inexperience of financial intermediaries, lack of modern technology and the
possibility of permanent or temporary termination of trading of securities may
affect a Fund's performance. To the extent that a Fund purchases equity
securities of smaller companies, such securities may experience greater
volatility and have limited liquidity.

Former communist regimes of a number of Eastern European countries had
expropriated a large amount of property, the claims on which have not been
entirely settled. There can be no assurance that a Fund's investments in Eastern
Europe would not also be expropriated, nationalized or otherwise confiscated.
Finally, any change in the leadership or policies of Eastern European countries,
or the countries that exercise a significant influence over those countries, may
halt the expansion of or reverse the liberalization of foreign investment
policies now occurring and adversely affect existing investment opportunity.

Although the governments of certain Eastern European countries currently are
implementing or considering reforms directed at political and economic
liberalization, there can be no assurance that these reforms will continue or
achieve their goals.

Strategic Transactions and derivatives. Strategic Transactions, including
derivative contracts, have risks associated with them including possible default
by the other party to the transaction, illiquidity and, to the extent the
Adviser's view as to certain market movements is incorrect, the risk that the
use of such Strategic Transactions could result in losses greater than if they
had not been used. Use of put and call options may result in losses to a Fund,
force the sale or purchase of portfolio securities at inopportune times or for
prices higher than (in the case of put options) or lower than (in the case of
call options) current market values, limit the amount of appreciation a Fund can
realize on its investments or cause a Fund to hold a security it might otherwise
sell. The use of currency transactions can result in a Fund incurring losses as
a result of a number of factors including the imposition of exchange controls,
suspension of settlements, or the inability to deliver or receive a specified
currency. The use of options and futures transactions entails certain other
risks. In particular, the variable degree of correlation between price movements
of futures contracts and price movements in the related portfolio position of a
Fund creates the possibility that losses on the hedging instrument may be
greater than gains in the value of a Fund's position. In addition, futures and
options markets may not be liquid in all circumstances and certain
over-the-counter options may have no markets. As a result, in certain markets, a
Fund might not be able to close out a transaction without incurring substantial
losses, if at all. Although the use of futures contracts and options

27
<PAGE>

transactions for hedging should tend to minimize the risk of loss due to a
decline in the value of the hedged position, at the same time they tend to limit
any potential gain which might result from an increase in value of such
position. Finally, the daily variation margin requirements for futures contracts
would create a greater ongoing potential financial risk than would purchases of
options, where the exposure is limited to the cost of the initial premium.
Losses resulting from the use of Strategic Transactions would reduce net asset
value, and possibly income, and such losses can be greater than if the Strategic
Transactions had not been utilized. The Strategic Transactions that a Fund may
use and some of their risks are described more fully in each Fund's respective
Statement of Additional Information.

Distribution and performance information

Dividends and capital gains distributions

Scudder Global Fund and Scudder International Fund intend to distribute any
dividends from net investment income and any net realized capital gains after
utilization of capital loss carryforwards, if any, in November or December to
prevent application of a federal excise tax. An additional distribution may be
made, if necessary.

Scudder Global Discovery Fund intends to distribute any dividends from its net
investment income and any net realized capital gains after utilization of
capital loss carryforwards, if any, in December. An additional distribution may
be made if necessary.

Scudder Greater Europe Growth Fund intends to distribute dividends from its net
investment income and any net realized capital gains after utilization of
capital loss carryforwards, if any, annually in December to prevent application
of federal excise tax, although an additional distribution may be made if
required, at a later date.

Scudder International Growth and Income Fund intends to distribute dividends
from its net investment income semiannually in June and December. The Fund
intends to distribute net realized capital gains after utilization of capital
loss carryforwards, if any, in November or December to prevent application of a
federal excise tax. An additional distribution may be made, if necessary.

For all the Funds, any dividends or capital gains distributions declared in
October, November or December with a record date in such a month and paid during
the following January will be treated by shareholders for federal income tax
purposes as if received on December 31 of the calendar year declared.

According to preference, shareholders may receive distributions in cash or have
them reinvested in additional shares of a Fund. If an investment is in the form
of a retirement plan, all dividends and capital gains distributions must be
reinvested into the shareholder's account.

Generally, dividends from net investment income are taxable to shareholders as
ordinary income. Long-term capital gains distributions, if any, are taxable as
long-term capital gains regardless of the length of time shareholders have owned
their shares. Short-term capital gains and any other taxable income
distributions are taxable as ordinary income. A portion of dividends from net
investment income may qualify for the dividends-received deduction for
corporations. Shareholders may be able to claim a credit or deduction on their
income tax returns for their pro rata portions of qualified taxes paid by a Fund
to foreign countries.

Each Fund sends detailed tax information about the amount and type of its
distributions to its shareholders by January 31 of the following year.

Under normal investment conditions, it is anticipated that Scudder International
Growth and Income Fund's portfolio turnover rate will not exceed 75% for the
initial fiscal year. However, economic and market conditions may necessitate

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<PAGE>

more active trading, resulting in a higher portfolio turnover rate. A higher
rate involves greater brokerage expenses to the Fund and may result in the
realization of net capital gains, which would be taxable to shareholders when
distributed.

Performance information

From time to time, quotations of a Fund's performance may be included in
advertisements, sales literature or shareholder reports. All performance figures
are historical, show the performance of a hypothetical investment and are not
intended to indicate future performance. "Total return" is the change in value
of an investment in a Fund for a specified period. The "average annual total
return" of a Fund is the average annual compound rate of return of an investment
in a Fund assuming that the investment has been held for one year, five years
and ten years as of a stated ending date. (If a Fund has not been in operation
for at least ten years, the life of the Fund will be used where applicable.)
"Cumulative total return" represents the cumulative change in value of an
investment in a Fund for various periods. All types of total return calculations
assume that all dividends and capital gains distributions during the period were
reinvested in shares of a Fund. "Capital change" measures return from capital,
including reinvestment of any capital gains distributions but does not include
the reinvestment of dividends.

Performance for any of the five Funds will vary based upon, among other things,
changes in market conditions and the level of a Fund's expenses.

Fund organization

Scudder Global Fund and Scudder Global Discovery Fund are diversified series of
Scudder Global Fund, Inc. (the "Global Corporation"), an open-end, management
investment company registered under the 1940 Act. The Global Corporation was
organized as a Maryland corporation in May 1986. Scudder Global Discovery Fund
changed its name from Scudder Global Small Company Fund on March 6, 1996.

Scudder Greater Europe Growth Fund is a non-diversified series and Scudder
International Fund and Scudder International Growth and Income Fund are
diversified series of Scudder International Fund, Inc. (the "International
Corporation"), an open-end, management investment company registered under the
1940 Act. The International Corporation is a Maryland corporation whose
predecessor was organized in 1953.

The activities of the Funds are supervised by their respective Boards of
Directors. Shareholders have one vote for each share held on matters on which
they are entitled to vote. The Funds are not required to and have no current
intention of holding annual shareholder meetings, although special meetings may
be called for purposes such as electing or removing Directors, changing
fundamental investment policies or approving an investment management contract.
Shareholders will be assisted in communicating with other shareholders in
connection with removing a Director as if Section 16(c) of the 1940 Act were
applicable.

The prospectuses of each of the five Funds are combined in this prospectus. Each
Fund offers only its own shares, yet it is possible that a Fund might become
liable for a misstatement regarding another Fund. The Directors of each
Corporation have considered this and approved the use of a combined prospectus.

Investment adviser

Each Fund retains the investment management firm of Scudder, Stevens & Clark,
Inc., a Delaware corporation, to manage the daily investment and business
affairs subject to the policies established by each Corporation's Board of
Directors. The Directors have overall responsibility for the management of the
Funds under Maryland law.

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<PAGE>

Management fees are payable monthly, provided that
each Fund will make such interim payments as may be requested by the Adviser not
to exceed 75% of the amount of the fee then accrued on the books of a Fund and
unpaid.

The Funds' management fees are higher than that charged to most other funds.
However, management of the Funds involves analyzing companies, markets and
economies throughout the world and the management fees are not necessarily
higher than the fees charged to funds with similar investment objectives and
policies.

For the fiscal year ended June 30, 1996, the Adviser received an investment
management fee of 0.96% of the average daily net assets of Scudder Global Fund.
The Adviser receives an investment management fee for these services equal, on
an annual basis, to 1.00% of the first $500 million of average daily net assets,
0.95% of such assets in excess of $500 million and 0.90% of such assets in
excess of $1 billion.

From July 1, 1997 to September 11, 1997, the Adviser has agreed to waive 0.05%
of that portion of its investment management fee payable by Scudder Global Fund
based on the average daily net assets of the Fund in excess of $1.5 billion. It
is expected that the Fund's Board of Directors will approve an Investment
Management Agreement effective September 11, 1997 containing a similar reduction
in the investment management fee.

Prior to September 6, 1995, the Adviser received on an annual basis, an
investment management fee for its services equal to 1.00% of the first $500
million of average daily net assets and 0.95% of such assets in excess of $500
million.

For the fiscal year ended October 31, 1996 the Adviser received an investment
management fee of 1.09% of Scudder Global Discovery Fund's average daily net
assets.

Scudder Greater Europe Growth Fund pays the Adviser an annual fee of 1.00% of
the Fund's average daily net assets. For the fiscal year ended October 31, 1996,
the Adviser did not impose a portion of its management fee, maintaining the
annualized expenses for the Fund at 1.50% and, accordingly, received an
investment management fee of 0.53% of the Fund's daily net assets.

For the fiscal year ended March 31, 1997, the Adviser received an investment
management fee of 0.82% of Scudder International Fund's average daily net
assets.

As of September 5, 1996, the Fund pays the Adviser an annual fee of 0.90% of the
first $500 million of average daily net assets, 0.85% of such assets in excess
of $500 million, 0.80% of such assets in excess of $1 billion, 0.75% of such
assets in excess of $2 billion, and 0.70% of such assets in excess of $3
billion.

Prior to September 5, 1996, the Fund paid the Adviser an annual fee of 0.90% of
the first $500 million of average daily net assets, 0.85% of such assets in
excess of $500 million, 0.80% of such assets in excess of $1 billion, and 0.75%
of such assets in excess of $2 billion.

The management fees for Scudder Global Fund and Scudder International Fund are
graduated so that increases in a Fund's net assets may result in a lower fee and
decreases in a Fund's net assets may result in a higher fee.

Scudder International Growth and Income Fund pays the Adviser an annual fee of
1.00% of the Fund's average daily net assets. The Adviser has agreed to maintain
the annualized expenses of the Fund at no more than 1.75% of the average daily
net assets of the Fund until June 30, 1998.

Under the Investment Management Agreement with the Adviser, each Fund is
responsible for all of its expenses, including fees and expenses incurred in
connection with membership in investment company organizations; fees and
expenses of each Fund's accounting agent; brokers' commissions; legal, auditing
and accounting expenses; taxes and governmental fees; the fees and expenses of
the transfer agent; the expenses of and the fees for registering or qualifying
securities for sale; the fees and expenses of Directors, officers and employees

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<PAGE>

of each Corporation who are not affiliated with the Adviser; the cost of
printing and distributing reports and notices to shareholders; and the fees and
disbursements of custodians.

All of a Fund's expenses are paid out of gross investment income. Shareholders
pay no direct charges or fees for investment or administrative services.

Scudder, Stevens & Clark, Inc. is located at 345 Park Avenue, New York, New
York.

Transfer agent

Scudder Service Corporation, P.O. Box 2291, Boston, Massachusetts 02107-2291, a
subsidiary of the Adviser, is the transfer, shareholder servicing and
dividend-paying agent for the Funds.

Underwriter

Scudder Investor Services, Inc., a subsidiary of the Adviser, is the Funds'
principal underwriter. Scudder Investor Services, Inc. confirms, as agent, all
purchases of shares of the Funds. Scudder Investor Relations is a telephone
information service provided by Scudder Investor Services, Inc.

Fund accounting agent

Scudder Fund Accounting Corporation, a subsidiary of the Adviser, is responsible
for determining the daily net asset value per share and maintaining the general
accounting records of the Funds.

Custodian

Brown Brothers Harriman & Co. is the custodian for each of the Funds.

Transaction information

Purchasing shares

Purchases are executed at the next calculated net asset value per share after
the Fund's transfer agent receives the purchase request in good order. Purchases
are made in full and fractional shares. (See "Share price.")

By check. If you purchase shares with a check that does not clear, your purchase
will be canceled and you will be subject to any losses or fees incurred in the
transaction. Checks must be drawn on or payable through a U.S. bank. If you
purchase shares by check and redeem them within seven business days of purchase,
the Fund may hold redemption proceeds until the purchase check has cleared. If
you purchase shares by federal funds wire, you may avoid this delay. Redemption
requests by telephone prior to the expiration of the seven-day period will not
be accepted.

By wire. To open a new account by wire, first call Scudder at 1-800-225-5163 to
obtain an account number. A representative will instruct you to send a
completed, signed application to the transfer agent. Accounts cannot be opened
without a completed, signed application and a Scudder fund account number.
Contact your bank to arrange a wire transfer to:

The Scudder Funds
State Street Bank and Trust Company
Boston, MA 02101
ABA Number 011000028
DDA Account 9903-5552

Your wire instructions must also include:
- -- the name of the fund in which the money is to be invested,
- -- the account number of the fund, and
- -- the name(s) of the account holder(s).

The account will be established once the application and money order are
received in good order.

You may also make additional investments of $100 or more to your existing
account by wire.

By exchange. Each Fund may be exchanged for shares of other funds in the Scudder
Family of Funds unless otherwise determined by each Fund's respective Board of
Directors. Your new account will have the same registration and address as your
existing account.

The exchange requirements for corporations, other organizations, trusts,
fiduciaries, agents, institutional investors and retirement plans may be

31
<PAGE>

different from those for regular accounts. Please call 1-800-225-5163 for more
information, including information about the transfer of special account
features.

You can also make exchanges among your Scudder fund accounts on SAIL, the
Scudder Automated Information Line, by calling 1-800-343-2890.

By telephone order. Existing shareholders may purchase shares at a certain day's
price by calling 1-800-225-5163 before the close of regular trading on the New
York Stock Exchange (the "Exchange"), normally 4 p.m. eastern time, on that day.
Orders must be for $10,000 or more and cannot be for an amount greater than four
times the value of your account at the time the order is placed. A confirmation
with complete purchase information is sent shortly after your order is received.
You must include with your payment the order number given at the time the order
is placed. If payment by check or wire is not received within three business
days, the order is subject to cancellation and the shareholder will be
responsible for any loss to the Fund resulting from this cancellation. Telephone
orders are not available for shares held in Scudder IRA accounts and most other
Scudder retirement plan accounts.

By "QuickBuy." If you elected "QuickBuy" for your account, you can call
toll-free to purchase shares. The money will be automatically transferred from
your predesignated bank checking account. Your bank must be a member of the
Automated Clearing House for you to use this service. If you did not elect
"QuickBuy," call 1-800-225-5163 for more information.

To purchase additional shares, call 1-800-225-5163. Purchases may not be for
more than $250,000. Proceeds in the amount of your purchase will be transferred
from your bank checking account in two or three business days following your
call. For requests received by the close of regular trading on the Exchange,
shares will be purchased at the net asset value per share calculated at the
close of trading on the day of your call. "QuickBuy" requests received after the
close of regular trading on the Exchange will begin their processing and be
purchased at the net asset value calculated the following business day.

If you purchase shares by "QuickBuy" and redeem them within seven days of the
purchase, the Fund may hold the redemption proceeds for a period of up to seven
business days. If you purchase shares and there are insufficient funds in your
bank account, the purchase will be canceled and you will be subject to any
losses or fees incurred in the transaction. "QuickBuy" transactions are not
available for most retirement plan accounts. However, "QuickBuy" transactions
are available for Scudder IRA accounts.

Redeeming shares

Each Fund allows you to redeem shares (i.e., sell them back to the Fund) without
redemption fees.

By telephone. This is the quickest and easiest way to sell Fund shares. If you
provided your banking information on your application, you can call to request
that federal funds be sent to your authorized bank account. If you did not
include your banking information on your application, call 1-800-225-5163 for
more information.

Redemption proceeds will be wired to your bank unless otherwise requested. If
your bank cannot receive federal reserve wires, redemption proceeds will be
mailed to your bank. There will be a $5 charge for all wire redemptions.

You can also make redemptions from your Scudder fund account on SAIL by calling
1-800-343-2890.

If you open an account by wire, you cannot redeem shares by telephone until the
Funds' transfer agent has received your completed and signed application.
Telephone redemption is not available for shares held in Scudder IRA accounts
and most other Scudder retirement plan accounts.

32
<PAGE>

In the event that you are unable to reach a Fund by telephone, you should write
to a Fund; see "How to contact Scudder" for the address.

By "QuickSell." If you elected "QuickSell" for your account, you can call
toll-free to redeem shares. The money will be automatically transferred to your
predesignated bank checking account. Your bank must be a member of the Automated
Clearing House for you to use this service. If you did not elect "QuickSell,"
call 1-800-225-5163 for more information.

To redeem shares, call 1-800-225-5163. Redemptions must be for at least $250.
Proceeds in the amount of your redemption will be transferred to your bank
checking account in two or three business days following your call. For requests
received by the close of regular trading on the Exchange, shares will be
redeemed at the net asset value per share calculated at the close of trading on
the day of your call. "QuickSell" requests received after the close of regular
trading on the Exchange will begin their processing and be redeemed at the net
asset value calculated the following business day.

"QuickSell" transactions are not available for Scudder IRA accounts and most
other retirement plan accounts.

Signature guarantees. For your protection and to prevent fraudulent redemptions,
on written redemption requests in excess of $100,000 we require an original
signature and an original signature guarantee for each person in whose name the
account is registered. (The Fund reserves the right, however, to require a
signature guarantee for all redemptions.) You can obtain a signature guarantee
from most banks, credit unions or savings associations, or from broker/dealers,
municipal securities broker/dealers, government securities broker/dealers,
national securities exchanges, registered securities associations or clearing
agencies deemed eligible by the Securities and Exchange Commission. Signature
guarantees by notaries public are not acceptable. Redemption requirements for
corporations, other organizations, trusts, fiduciaries, agents, institutional
investors and retirement plans may be different from those for regular accounts.
For more information, please call 1-800-225-5163.

Telephone transactions

Shareholders automatically receive the ability to exchange by telephone and the
right to redeem by telephone up to $100,000 to their address of record.
Shareholders also may, by telephone, request that redemption proceeds be sent to
a predesignated bank account. Each Fund uses procedures designed to give
reasonable assurance that telephone instructions are genuine, including
recording telephone calls, testing a caller's identity and sending written
confirmation of telephone transactions. If a Fund does not follow such
procedures, it may be liable for losses due to unauthorized or fraudulent
telephone instructions. Each Fund will not be liable for acting upon
instructions communicated by telephone that it reasonably believes to be
genuine.

Share price

Purchases and redemptions, including exchanges, are made at net asset value.
Scudder Fund Accounting Corporation determines net asset value per share for
each Fund as of the close of regular trading on the Exchange, normally 4 p.m.
eastern time, on each day the Exchange is open for trading. Net asset value per
share is calculated by dividing the value of total Fund assets, less all
liabilities, by the total number of shares outstanding.

Trading in securities on foreign securities exchanges is normally completed
before the close of regular trading on the Exchange. Trading on these foreign
exchanges may not take place on all days on which there is regular trading on
the Exchange, or may take place on days on which there is no regular trading on
the Exchange. If events materially affecting the value of a Fund's portfolio
securities occur between the time when these foreign exchanges close and the
time when the Fund's net asset value is calculated, such securities will be

33
<PAGE>

valued at fair value as determined by each Corporation's Board of Directors.

Processing time

All purchase and redemption requests must be received in good order by the
Funds' transfer agent. Those requests received by the close of regular trading
on the Exchange are executed at the net asset value per share calculated at the
close of regular trading that day. Those requests received after the close of
regular trading on the Exchange will be executed the following business day.

If you wish to make a purchase of $500,000 or more, you should notify Scudder
Investor Relations by calling 1-800-225-5163.

Each Fund will normally send your redemption proceeds within one business day
following the redemption request, but may take up to seven business days (or
longer in the case of shares recently purchased by check).

Purchase restrictions

Purchases and sales should be made for long-term investment purposes only. The
Funds and Scudder Investor Services, Inc. each reserve the right to reject
purchases of Fund shares (including exchanges) for any reason including when a
pattern of frequent purchases and sales made in response to short-term
fluctuations in a Fund's share price appears evident.

Tax information

A redemption of shares, including an exchange into another Scudder fund, is a
sale of shares and may result in a gain or loss for income tax purposes.

Tax identification number

Be sure to complete the Tax Identification Number section of the application
when you open an account. Federal tax law requires a Fund to withhold 31% of
taxable dividends, capital gains distributions and redemption and exchange
proceeds from accounts (other than those of certain exempt payees) without a
certified Social Security or tax identification number and certain other
certified information or upon notification from the IRS or a broker that
withholding is required. Each Fund reserves the right to reject new account
applications without a certified Social Security or tax identification number.
Each Fund also reserves the right, following 30 days' notice, to redeem all
shares in accounts without a certified Social Security or tax identification
number. A shareholder may avoid involuntary redemption by providing a Fund with
a tax identification number during the 30-day notice period.

Minimum balances

Shareholders should maintain a share balance worth at least $2,500, which amount
may be changed by the Board of Directors. Scudder retirement plans and certain
other accounts have similar or lower minimum share balance requirements. A
shareholder may open an account with at least $1,000, if an automatic investment
plan of $100/month is established.

Shareholders who maintain a non-fiduciary account balance of less than $2,500 in
a Fund, without establishing an automatic investment plan, will be assessed an
annual $10.00 per fund charge with the fee to be paid to the Fund. The $10.00
charge will not apply to shareholders with a combined household account balance
in any of the Scudder Funds of $25,000 or more. Each Fund reserves the right,
following 60 days' written notice to shareholders, to redeem all shares in
accounts below $250, including accounts of new investors, where a reduction in
value has occurred due to a redemption or exchange out of the account. The Fund
will mail the proceeds of the redeemed account to the shareholder. Reductions in
value that result solely from market activity will not trigger an involuntary
redemption. Retirement accounts and certain other accounts will not be assessed
the $10.00 charge or be subject to automatic liquidation. Please refer to
"Exchanges and Redemptions--Other Information" in the Funds' Statements of

34
<PAGE>

Additional Information for more information.

Third party transactions

If purchases and redemptions of Fund shares are arranged and settlement is made
at an investor's election through a member of the National Association of
Securities Dealers, Inc., other than Scudder Investor Services, Inc., that
member may, at its discretion, charge a fee for that service.

Redemption-in-kind

Each Fund reserves the right, if conditions exist which make cash payments
undesirable, to honor any request for redemption or repurchase order by making
payment in whole or in part in readily marketable securities chosen by a Fund
and valued as they are for purposes of computing each Fund's net asset value (a
redemption-in-kind).

If payment is made in securities, a shareholder may incur transaction expenses
in converting these securities to cash. Each Corporation has elected, however,
to be governed by Rule 18f-1 under the 1940 Act, as a result of which a Fund is
obligated to redeem shares, with respect to any one shareholder during any
90-day period, solely in cash up to the lesser of $250,000 or 1% of the net
asset value of each Fund at the beginning of the period.

Shareholder benefits

Experienced professional management

Scudder, Stevens & Clark, Inc., one of the nation's most experienced investment
management firms, actively manages your Scudder fund investment. Professional
management is an important advantage for investors who do not have the time or
expertise to invest directly in individual securities.

A team approach to investing

Each Fund is managed by a team of Scudder investment professionals who each play
an important role in a Fund's management process. Team members work together to
develop investment strategies and select securities for each Fund's portfolio.
They are supported by Scudder's large staff of economists, research analysts,
traders and other investment specialists who work in Scudder's offices across
the United States and abroad. Scudder believes its team approach benefits Fund
investors by bringing together many disciplines and leveraging Scudder's
extensive resources.

Scudder Global Fund. Lead Portfolio Manager William E. Holzer has had day-to-day
responsibility for Scudder Global Fund's worldwide strategy and investment
themes since its inception in 1986. Mr. Holzer, who has over 20 years'
experience in global investing, joined Scudder in 1980. Nicholas Bratt,
Portfolio Manager, directs Scudder's overall global equity investment
strategies. Mr. Bratt joined Scudder in 1976 and the team in 1993. Alice Ho,
Portfolio Manager, joined the team in 1994 and is also responsible for
implementing the Fund's strategy. Ms. Ho, who joined Scudder in 1986 as a member
of the institutional and private investment counsel areas, has worked as a
portfolio manager since 1989.

Scudder Global Discovery Fund. Lead Portfolio Manager Gerald J. Moran has set
the Scudder Global Discovery Fund's investment strategy and overseen its daily
operation since the Fund was introduced in 1991. Mr. Moran joined Scudder's
equity research and management area in 1968 as an analyst and has focused on
small company stocks since 1982 and has been a portfolio manager since 1985.
Elizabeth J. Allan, Portfolio Manager, who joined the team in 1994, concentrates
on the Fund's Pacific Basin investments. Ms. Allan, who has been a portfolio
manager at Scudder since 1991, joined the firm in 1987 as a member of the
portfolio management team of a Scudder closed-end mutual fund concentrating its
investments in Asia. Joan R. Gregory, Portfolio Manager, joined the team in 1994

35
<PAGE>

and focuses on stock selection, a role she has played since she joined Scudder
in 1992. Ms. Gregory has been involved with investment in global and
international stocks as an assistant portfolio manager since 1989. Sewall
Hodges, Portfolio Manager, joined Scudder in 1995 and the team in 1996. Mr.
Hodges, who has eleven years of experience in global analysis and portfolio
management, focuses on the Fund's stock selection and research.

Scudder Greater Europe Growth Fund. Carol L. Franklin, Lead Portfolio Manager,
sets Fund investment strategy and oversees its daily operation. Ms. Franklin
joined Scudder in 1981 and has ten years of European research and investment
management experience. Nicholas Bratt, Portfolio Manager, helps set the Fund's
general investment strategies. Mr. Bratt has over 20 years of experience in
worldwide investing and has been with Scudder since 1976. Joan R. Gregory,
Portfolio Manager, focuses on stock selection, a role she has played since she
joined Scudder in 1992. Ms. Gregory has been involved with investment in global
and international stocks as an assistant portfolio manager since 1989.

Scudder International Fund. Lead Portfolio Manager Irene Cheng joined Scudder in
1993. Ms. Cheng, who has over 13 years of industry experience, focuses on
portfolio management and equity strategy for Scudder's international equity
accounts. Nicholas Bratt, Portfolio Manager, directs Scudder's overall global
equity investment strategies. Mr. Bratt joined Scudder and the team in 1976.
Carol L. Franklin joined Scudder International Fund's portfolio management team
in 1986. Ms. Franklin, who has over 20 years of experience in finance and
investing, joined Scudder in 1981. Joan Gregory, Portfolio Manager, focuses on
stock selection, a role she has played since she joined Scudder in 1992. Ms.
Gregory, who joined the team in 1994, has been involved with investment in
global and international stocks. Marc Joseph, Portfolio Manager, managed
international portfolios prior to joining Scudder in 1997 and is a member of
Scudder's Global Equity Group where he focuses on managing international equity
portfolios. Mr. Joseph has over 10 years of industry experience. Sheridan Reilly
joined Scudder in 1995 and is a member of Scudder's Global Equity Group. Mr.
Reilly has over 10 years of industry experience focusing on strategies for
global portfolios, currency hedging and foreign equity markets.

Scudder International Growth and Income Fund. Lead Portfolio Manager Sheridan
Reilly joined Scudder in 1995 and is a member of Scudder's Global Equity Group.
Mr. Reilly has over 10 years of industry experience focusing on strategies for
global portfolios, currency hedging, and foreign equity markets. Portfolio
Manager Irene Cheng joined Scudder in 1993. Ms. Cheng, who has over 13 years of
industry experience, focuses on portfolio management, research, and equity
analysis for Scudder's institutional international equity accounts.

SAIL(TM)--Scudder Automated Information Line

For personalized account information including fund prices, yields and account
balances, to perform transactions in existing Scudder fund accounts, or to
obtain information on any Scudder fund, shareholders can call Scudder's
Automated Information Line (SAIL) at 1-800-343-2890, 24 hours a day. During
periods of extreme economic or market changes, or other conditions, it may be
difficult for you to effect telephone transactions in your account. In such an
event you should write to the Fund; please see "How to contact Scudder" for the
address.

Investment flexibility

Scudder offers toll-free telephone exchange between funds at current net asset
value. You can move your investments among money market, income, growth,
tax-free and growth and income funds with a simple toll-free call or, if you
prefer, by sending your instructions through the mail or by fax. Telephone and
fax redemptions and exchanges are subject to termination and their terms are

36
<PAGE>

subject to change at any time by the Fund or the transfer agent. In some cases,
the transfer agent or Scudder Investor Services, Inc. may impose additional
conditions on telephone transactions.

Personal Counsel(SM) -- A Managed Fund Portfolio Program

If you would like to receive direct guidance and management of your overall
mutual fund portfolio to help you pursue your investment goals, you may be
interested in Personal Counsel from Scudder. Personal Counsel, a program of
Scudder Investor Services, Inc., a registered investment adviser and a
subsidiary of Scudder, Stevens & Clark, Inc., combines the benefits of a
customized portfolio of pure no-load Scudder Funds with ongoing portfolio
monitoring and individualized service, for an annual fee of generally 1% or less
of assets (with a $1,000 minimum). In addition, it draws upon Scudder's more
than 75-year heritage of providing investment counsel to large corporate and
private clients. If you have $100,000 or more to invest initially and would like
more information about Personal Counsel, please call 1-800-700-0183.

Dividend reinvestment plan

You may have dividends and distributions automatically reinvested in additional
Fund shares. Please call 1-800-225-5163 to request this feature.

Shareholder statements

You receive a detailed account statement every time you purchase or redeem
shares. All of your statements should be retained to help you keep track of
account activity and the cost of shares for tax purposes.

Shareholder reports

In addition to account statements, you receive periodic shareholder reports
highlighting relevant information, including investment results and a review of
portfolio changes. To reduce the volume of mail you receive, only one copy of
most Fund reports, such as the Fund's Annual Report, may be mailed to your
household (same surname, same address). Please call 1-800-225-5163 if you wish
to receive additional shareholder reports.

Newsletters

Four times a year, Scudder sends you Perspectives, an informative newsletter
covering economic and investment developments, service enhancements and other
topics of interest to Scudder fund investors.

Scudder Investor Centers

As a convenience to shareholders who like to conduct business in person, Scudder
Investor Services, Inc. maintains Investor Centers in Boca Raton, Boston,
Chicago, New York and San Francisco.

T.D.D. service for the hearing impaired

Scudder's full range of investor information and shareholder services is
available to hearing impaired investors through a toll-free T.D.D. (Telephone
Device for the Deaf) service. If you have access to a T.D.D., call
1-800-543-7916 for investment information or specific account questions and
transactions.

37
<PAGE>

Purchases

Opening Minimum initial investment: $2,500; IRAs $1,000
an account
Group retirement plans (401(k), 403(b), etc.) have similar or lower minimums.
See appropriate plan literature.

<S> <C> <C> <C> <C>
o By Mail Send your completed and signed application and check
Make checks
payable to "The
Scudder Funds."
by regular mail to: or by express, registered,
or certified mail to:
The Scudder Funds Scudder Shareholder Service
P.O. Box 2291 Center
Boston, MA 42 Longwater Drive
02107-2291 Norwell, MA
02061-1612

o By Wire Please see Transaction information--Purchasing shares--
By wire for details, including the ABA wire transfer number.
Then call 1-800-225-5163 for instructions.

o In Person Visit one of our Investor Centers to complete your application with the
help of a Scudder representative. Investor Center locations are listed
under Shareholder benefits.

-----------------------------------------------------------------------------------------------------------------------

Purchasing Minimum additional investment: $100; IRAs $50
additional shares
Group retirement plans (401(k), 403(b), etc.) have similar or lower minimums.
See appropriate plan literature.

Make checks o By Mail Send a check with a Scudder investment slip, or with a letter of
payable to "The instruction including your account number and the complete Fund name, to
Scudder Funds." the appropriate address listed above.

o By Wire Please see Transaction information--Purchasing shares--
By wire for details, including the ABA wire transfer number.

o In Person Visit one of our Investor Centers to make an additional
investment in your Scudder fund account. Investor Center
locations are listed under Shareholder benefits.

o By Telephone Please see Transaction information--Purchasing shares--
By QuickBuy or By telephone order for more details.

o By Automatic You may arrange to make investments on a regular basis through automatic
Investment Plan deductions from your bank checking account. Please call 1-800-225-5163
($50 minimum) for more information and an enrollment form.

</TABLE>

38
<PAGE>

Exchanges and redemptions

<S> <C> <C> <C> <C>
Exchanging Minimum investments: $2,500 to establish a new account;
shares $100 to exchange among existing accounts

o By Telephone To speak with a service representative, call 1-800-225-5163 from
8 a.m. to 8 p.m. eastern time or to access SAIL(TM), Scudder's Automated
Information Line, call 1-800-343-2890 (24 hours a day).

o By Mail Print or type your instructions and include:
or Fax - the name of the Fund and the account number you are exchanging from;
- your name(s) and address as they appear on your account;
- the dollar amount or number of shares you wish to exchange;
- the name of the Fund you are exchanging into;
- your signature(s) as it appears on your account; and
- a daytime telephone number.

Send your instructions
by regular mail to: or by express, registered, or by fax to:
or certified mail to:

The Scudder Funds Scudder Shareholder 1-800-821-6234
P.O. Box 2291 Service Center
Boston, MA 02107-2291 42 Longwater Drive
Norwell, MA
02061-1612
-----------------------------------------------------------------------------------------------------------------------

Redeeming o By Telephone To speak with a service representative, call 1-800-225-5163 from 8 a.m.
shares to 8 p.m. eastern time or to access SAIL(TM), Scudder's Automated Information
Line, call 1-800-343-2890 (24 hours a day). You may have redemption
proceeds sent to your predesignated bank account, or redemption
proceeds of up to $100,000 sent to your address of record.

o By Mail Send your instructions for redemption to the appropriate address or fax number
or Fax above and include:
- the name of the Fund and account number you are redeeming from;
- your name(s) and address as they appear on your account;
- the dollar amount or number of shares you wish to redeem;
- your signature(s) as it appears on your account; and
- a daytime telephone number.

A signature guarantee is required for redemptions over $100,000.
See Transaction information--Redeeming shares.

o By Automatic You may arrange to receive automatic cash payments periodically. Call
Withdrawal 1-800-225-5163 for more information and an enrollment form.
Plan
</TABLE>

39
<PAGE>

Scudder tax-advantaged retirement plans

Scudder offers a variety of tax-advantaged retirement plans for individuals,
businesses and non-profit organizations. These flexible plans are designed for
use with the Scudder Family of Funds (except Scudder tax-free funds, which are
inappropriate for such plans). Scudder Funds offer a broad range of investment
objectives and can be used to seek almost any investment goal. Using Scudder's
retirement plans can help shareholders save on current taxes while building
their retirement savings.

o Scudder No-Fee IRAs. These retirement plans allow a maximum annual
contribution of up to $2,000 per person for anyone with earned income (up
to $2,000 per individual for married couples if only one spouse has earned
income). Many people can deduct all or part of their contributions from
their taxable income, and all investment earnings accrue on a tax-deferred
basis. The Scudder No-Fee IRA charges you no annual custodial fee.

o 401(k) Plans. 401(k) plans allow employers and employees to make
tax-deductible retirement contributions. Scudder offers a full service
program that includes recordkeeping, prototype plan, employee
communications and trustee services, as well as investment options.

o Profit Sharing and Money Purchase Pension Plans. These plans allow
corporations, partnerships and people who are self-employed to make
annual, tax-deductible contributions of up to $30,000 for each person
covered by the plans. Plans may be adopted individually or paired to
maximize contributions. These are sometimes known as Keogh plans. The
Scudder Keogh charges you no annual custodial fee.

o 403(b) Plans. Retirement plans for tax-exempt organizations and school
systems to which employers and employees may both contribute.

o SEP-IRAs. Easily administered retirement plans for small businesses and
self-employed individuals. The maximum annual contribution to SEP-IRA
accounts is adjusted each year for inflation. The Scudder SEP-IRA charges
you no annual custodial fee.

o Scudder Horizon Plan. A no-load variable annuity that lets you build
assets by deferring taxes on your investment earnings. You can start with
$2,500 or more.

Scudder Trust Company (an affiliate of the Adviser) is Trustee or Custodian for
some of these plans and is paid an annual fee for some of the above retirement
plans. For information about establishing a Scudder No-Fee IRA, SEP-IRA, Profit
Sharing Plan, Money Purchase Pension Plan or a Scudder Horizon Plan, please call
1-800-225-2470. For information about 401(k)s or 403(b)s please call
1-800-323-6105. To effect transactions in existing IRA, SEP-IRA, Profit Sharing
or Pension Plan accounts, call 1-800-225-5163.

The variable annuity contract is provided by Charter National Life Insurance
Company (in New York State, Intramerica Life Insurance Company [S 1802]). The
contract is offered by Scudder Insurance Agency, Inc. (in New York State, Nevada
and Montana, Scudder Insurance Agency of New York, Inc.). CNL, Inc. is the
Principal Underwriter. Scudder Horizon Plan is not available in all states.

Scudder Investor Relations is a service provided through Scudder Investor
Services, Inc., Distributor.

40
<PAGE>

Investment products and services

The Scudder Family of Funds+++
- --------------------------------------------------------------------------------
Money Market
- ------------
Scudder U.S. Treasury Money Fund
Scudder Cash Investment Trust
Scudder Money Market Series --
Premium Shares*
Managed Shares*
Scudder Government Money Market Series --
Managed Shares*

Tax Free Money Market+
- ----------------------
Scudder Tax Free Money Fund
Scudder Tax Free Money Market Series--
Managed Shares*
Scudder California Tax Free Money Fund**
Scudder New York Tax Free Money Fund**

Tax Free+
- ---------
Scudder Limited Term Tax Free Fund
Scudder Medium Term Tax Free Fund
Scudder Managed Municipal Bonds
Scudder High Yield Tax Free Fund
Scudder California Tax Free Fund**
Scudder Massachusetts Limited Term Tax Free Fund**
Scudder Massachusetts Tax Free Fund**
Scudder New York Tax Free Fund**
Scudder Ohio Tax Free Fund**
Scudder Pennsylvania Tax Free Fund**

U.S. Income
- -----------
Scudder Short Term Bond Fund
Scudder Zero Coupon 2000 Fund
Scudder GNMA Fund
Scudder Income Fund
Scudder High Yield Bond Fund

Global Income
- -------------
Scudder Global Bond Fund
Scudder International Bond Fund
Scudder Emerging Markets Income Fund

Asset Allocation
- ----------------
Scudder Pathway Conservative Portfolio
Scudder Pathway Balanced Portfolio
Scudder Pathway Growth Portfolio
Scudder Pathway International Portfolio

U.S. Growth and Income
- ----------------------
Scudder Balanced Fund
Scudder Growth and Income Fund

U.S. Growth
- -----------
Value
Scudder Large Company Value Fund
Scudder Value Fund
Scudder Small Company Value Fund
Scudder Micro Cap Fund

Growth
Scudder Classic Growth Fund
Scudder Large Company Growth Fund
Scudder Development Fund
Scudder 21st Century Growth Fund

Global Growth
- -------------
Worldwide
Scudder Global Fund
Scudder International Growth and Income Fund
Scudder International Fund
Scudder Global Discovery Fund
Scudder Emerging Markets Growth Fund
Scudder Gold Fund

Regional
Scudder Greater Europe Growth Fund
Scudder Pacific Opportunities Fund
Scudder Latin America Fund
The Japan Fund, Inc.

Retirement Programs
- -------------------
IRA
SEP IRA
Keogh Plan
401(k), 403(b) Plans
Scudder Horizon Plan **+++ +++
(a variable annuity)

Closed-End Funds#
- --------------------------------------------------------------------------------
The Argentina Fund, Inc.
The Brazil Fund, Inc.
The Korea Fund, Inc.
The Latin America Dollar Income Fund, Inc.
Montgomery Street Income Securities, Inc.
Scudder New Asia Fund, Inc.
Scudder New Europe Fund, Inc.
Scudder Spain and Portugal Fund, Inc.
Scudder World Income Opportunities
Fund, Inc.

For complete information on any of the above Scudder funds, including management
fees and expenses, call or write for a free prospectus. Read it carefully before
you invest or send money. +++Funds within categories are listed in order from
expected least risk to most risk. +A portion of the income from the tax-free
funds may be subject to federal, state, and local taxes. *A class of shares of
the Fund. **Not available in all states. +++ +++A no-load variable annuity
contract provided by Charter National Life Insurance Company and its affiliate,
offered by Scudder's insurance agencies, 1-800-225-2470. #These funds, advised
by Scudder, Stevens & Clark, Inc., are traded on various stock exchanges.

41
<PAGE>

How to contact Scudder

Account Service and Information:
<S> <C>

For existing account service and transactions
Scudder Investor Relations -- 1-800-225-5163

For 24 hour account information, fund information, exchanges, and an
overview of all the services available to you

Scudder Electronic Account Services -- http://funds.scudder.com

For personalized information about your Scudder accounts, exchanges and redemptions

Scudder Automated Information Line (SAIL) -- 1-800-343-2890

Investment Information:

For information about the Scudder funds, including additional
applications and prospectuses, or for answers to investment questions

Scudder Investor Relations -- 1-800-225-2470
[email protected]

Scudder's World Wide Web Site -- http://funds.scudder.com

For establishing 401(k) and 403(b) plans

Scudder Defined Contribution Services -- 1-800-323-6105

Scudder Brokerage Services:

To receive information about this discount brokerage service and to obtain an application

Scudder Brokerage Services* -- 1-800-700-0820

Personal Counsel(SM) -- A Managed Fund Portfolio Program:

To receive information about this mutual fund portfolio guidance and management program

Personal Counsel from Scudder -- 1-800-700-0183

Please address all correspondence to:

The Scudder Funds
P.O. Box 2291
Boston, Massachusetts
02107-2291

Or Stop by a Scudder Investor Center:

Many shareholders enjoy the personal, one-on-one service of the Scudder
Investor Centers. Check for an Investor Center near you--they can be
found in the following cities:

Boca Raton Chicago San Francisco
Boston New York

Scudder Investor Relations and Scudder Investor Centers are services provided
through Scudder Investor Services, Inc., Distributor.

* Scudder Brokerage Services, Inc., 42 Longwater Drive, Norwell, MA
02061--Member NASD/SIPC.
</TABLE>