DEAR SHAREOWNER,
- --------------------------------------------------------------------------------
Pioneer Intermediate Tax-Free Fund completed the first half of its fiscal year
on June 30, 1996. The period followed one of the best years on record for the
bond market, and began with strong investing conditions including low inflation,
slow economic growth and falling interest rates. Early in the period, however,
unexpected economic growth created a more difficult market for bond investors.
HOW YOUR FUND PERFORMED
Your Fund's performance reflected the overall decline in bond prices. Following
are results for the six months ended June 30, 1996.
- - CLASS A SHARES -- Shareowners received income dividends totaling $0.242 per
share. The Fund's 30-day yield was 4.01% as of June 30, 1996.(1) Net asset
value stood at $10.12 per share on June 30, versus $10.44 six months ago,
reflecting the general dip in bond prices. The Fund's total return for the
six-month period was -0.76% based on net asset value and -4.24% based on the
maximum public offering price. Total return assumes the reinvestment of all
distributions at net asset value.
- - CLASS B SHARES -- Shareowners received a total of $0.192 per share in income
dividends for the period. As of June 30, the Fund's 30-day yield was 3.42%.(1)
Net asset value stood at $10.15 per share on June 30, versus $10.46 six months
ago, reflecting the general dip in bond prices. The Fund's total return was
-1.14% assuming shares were held throughout the period, and -4.05% if shares
were redeemed and the maximum 3% contingent deferred sales charge deducted on
June 30. Total return assumes the reinvestment of all distributions.
The Fund introduced CLASS C SHARES on January 31, 1996. Shareowners received a
total of $0.160 per share in income dividends during this abbreviated period. As
of June 30, the Fund's 30-day yield was 3.10%.1 Net asset value was $10.15 per
share, versus the introductory $10.51. Assuming shares were held throughout the
period, total return was -1.91%, -2.87% if shares were sold and the 1%
contingent deferred sales charge deducted on June 30. Total return assumes the
reinvestment of all distributions.
<TABLE>
Because your Fund's income is free from federal taxation, its yield compares
favorably with taxable bonds on an "after-tax" basis. The Fund's 4.01% yield on
Class A shares, 3.42% yield on Class B shares and 3.10% yield on Class C shares
would be equal to these taxable yields:
<CAPTION>
1996 TAXABLE EQUIVALENT YIELD
FEDERAL ------------------------------------
TAX BRACKET A SHARES B SHARES C SHARES
- ----------- -------- -------- --------
<S> <C> <C> <C>
39.6% 6.64% 5.66% 5.13%
36.0 6.27 5.34 4.84
31.0 5.81 4.96 4.49
</TABLE>
(1) Yield is based on a standard formula prescribed by the Securities and
Exchange Commission. The Fund's investment manager, Pioneering Management
Corporation, currently is not imposing a portion of its management fee.
Otherwise the yield for Class A, Class B and Class C shares would have been
3.90%, 3.33% and 3.02%, respectively.
<PAGE>
- --------------------------------------------------------------------------------
<TABLE>
The following table shows the Fund's total returns for longer time periods.
AVERAGE ANNUAL TOTAL RETURNS
(As of June 30, 1996)
<CAPTION>
NET PUBLIC
ASSET OFFERING
CLASS A SHARES VALUE PRICE*
---------------------- ----- --------
<S> <C> <C>
Life-of-Fund (10/22/86) 6.28% 5.90%
5 Years 6.43 5.68
1 Year 4.05 0.40
</TABLE>
<TABLE>
<CAPTION>
CLASS B SHARES IF HELD IF REDEEMED**
---------------------- ------- -------------
<S> <C> <C>
Life-of-Fund (4/29/94) 4.38% 3.50%
1 Year 3.19 0.21
</TABLE>
A SHIFTING BOND MARKET
When the period began, the outlook for the bond market was generally optimistic.
Investor confidence was reinforced when the Federal Reserve (the Fed) cut
short-term interest rates in January, indicating its concern over seemingly
sputtering economic growth. The mood changed in February, however, when the
monthly employment report, one of the many indicators used to monitor the
economy's strength, showed the biggest job increase in 12 years. Since then,
worries about an overheating economy have undermined investors' enthusiasm for
bonds and led interest rates higher. Short-term interest rates alone fell about
half a percentage point (0.5%) by the end of January but rose nearly one
percentage point (1.0%) from the beginning of February to the end of May.
For the most part, the tax-exempt bond market tracked the general bond market
during the period, although municipal bonds as a group slightly outperformed
their taxable counterparts. Nonetheless, low demand offset low supply for much
of the period, as many investors focused their attention on the fast-moving
stock market. Of course, many bonds are now attractively priced due to the
slowdown in demand and rise in interest rates. These values and the stock
market's choppiness could lead nervous equity investors away from stocks to the
bond market.
HOW PIONEER MANAGED YOUR INVESTMENT
Pioneer Intermediate Tax-Free Fund pursues current income exempt from federal
income taxes by investing in high-quality, intermediate-maturity issues. All
portfolio holdings have a rating of A or better; the average quality rating
stood at AA as of June 30. During the period, we slightly decreased the Fund's
weighting in the highest-rated issues, AAA, to 36% of the portfolio, versus 40%
six months ago.
PORTFOLIO QUALITY
(As of June 30, 1996)
[PIE CHART]
A 15%
AA 46%
AAA 36%
Cash Equivalents 3%
Overall, however, your management did not make any substantial changes during
the last six months, but instead focused on fine-tuning
* Reflects deduction of the maximum 3.5% sales charge at the beginning of the
period and assumes reinvestment of all distributions at net asset value.
** Reflects deduction of the maximum applicable contingent deferred sales charge
(CDSC) at the end of the period and assumes reinvestment of all
distributions. The 3% CDSC declines over four years.
Past performance does not guarantee future results. Return and share price
fluctuate, and your shares, when redeemed, may be worth more or less than
their original cost. A portion of income may be subject to state and local
taxes, although the Fund intends to minimize any taxable income. The Fund
currently avoids investments that are subject to the alternative minimum tax.
2
<PAGE>
------------------------------------------------------------------------------
the portfolio. For example, we added longer maturity bonds with higher coupon
payments that should offer more protection in a bumpy market. Short-term
municipal bonds with low coupons generally feel the effects of a volatile bond
market more than longer-term, higher-paying tax-free bonds.
We also emphasized noncallable investments that issuers cannot redeem, or
"call," prior to maturity. In our view, a conservative, intermediate position
should be most successful in maintaining the Fund's share price and for
providing reliable dividends in the current climate. The portfolio's average
life shortened slightly to 7.75 years on June 30, from 7.84 years six months
earlier.
MATURITY DISTRIBUTION
(Effective life as of June 30, 1996)
[PIE CHART]
0-2 Years 6%
2-5 Years 16%
5-7 Years 17%
7-10 Years 35%
10-15 Years 22%
15+ Years 4%
LOOKING AHEAD
Concerns about the fluctuating bond market continue as we move into the second
half of 1996. However, from our vantage point, we think economic growth will
stabilize and inflation will remain insignificant over the next six months.
Since February, housing and consumer spending have shown remarkable resiliency
in the face of higher interest rates, helping the economy show sustainable and
good growth but with nominal inflation. It seems interest rates may not move or
stay much higher in the near future. In this election year it is uncertain what
action, if any, the Fed will take. Without a strong indication of extreme
inflation or economic growth, the Fed may be hesitant to do anything.
For municipal bond investors, the shifting of tax rates remains an open dilemma
that is unlikely to be settled anytime soon. While this topic clearly requires
monitoring, we have confidence that tax-exempt bonds will continue to play a
unique and significant role for investors and municipalities. Your management
keeps a close eye on potential changes in the tax system as we work to attain
the Fund's goal of providing attractive income exempt from federal taxes. We
believe our conservative strategy and focus on high-quality issues will continue
to offer shareowners a good income stream and solid long-term performance.
One final note. We are pleased to announce that we are giving semiannual and
annual reports a facelift, including easy-to-find and use graphic summaries.
Your annual report dated December 31, 1996, will reflect these improvements. We
wish to thank all of you who took the time to respond to our questions about
what you want to see in fund reports.
Please read on through the following pages, which provide the Fund's audited
Schedule of Investments and financial statements as of June 30, 1996. If you
have any questions about your investment in Pioneer Intermediate Tax-Free Fund,
contact your investment representative, or call Pioneer at 1-800-225-6292.
Respectfully,
/s/ John F. Cogan, Jr.
John F. Cogan, Jr.
Chairman and President,
Pioneer Intermediate Tax-Free Fund
3
<PAGE>
SCHEDULE OF INVESTMENTS--PIONEER INTERMEDIATE TAX-FREE FUND--JUNE 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
STANDARD
& POOR'S/
MOODY'S
PRINCIPAL RATINGS
AMOUNT (UNAUDITED) INVESTMENTS+ VALUE
- ---------------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
INVESTMENT IN TAX-EXEMPT SECURITIES--96.9%
ALASKA--1.2%
$1,000,000 AAA/Aaa Alaska Housing Finance Corporation Revenue, MBIA Insured, 5.125%, 2006....... $ 993,580
-----------
ARIZONA--5.1%
1,000,000 AA/Aaa Arizona Transportation Board Highway Revenue, 6.5%, Prerefunded, 2001*....... 1,089,980
1,000,000 AA-/Aa Phoenix Civic Improvement Corporation Water Revenue, 6.5%, 2006#............. 1,101,260
1,000,000 AA/Aa Salt River Agricultural Improvement and Power District Arizona, 5.2%, 2008... 988,920
1,000,000 A+/A1 Tucson Water Revenue, 5.5%, 2014............................................. 975,460
-----------
4,155,620
-----------
CONNECTICUT--3.1%
1,000,000 AA/Aa Connecticut Housing Finance Authority Housing Mortgage Finance Program,
6.25%, 2011................................................................ 1,017,600
1,500,000 AA-/A1 Connecticut State Special Tax Transportation Revenue, 5.2%, 2005............. 1,505,115
-----------
2,522,715
-----------
DISTRICT OF COLUMBIA--0.7%
500,000 A+/NR Georgetown University General Obligation, 8.125%, 2008....................... 539,415
-----------
DELAWARE--1.3%
1,000,000 AA/A1 Delaware Transportation Authority Revenue, 5.2%, 2001........................ 1,018,950
-----------
FLORIDA--6.3%
1,000,000 AA/Aa Florida State Board of Education Capital Outlay General Obligation,
5.125%, 2005............................................................... 1,001,730
1,000,000 AAA/Aaa Florida State Department of Environmental Protection Sales Tax Revenue, AMBAC
Insured, 5.25%, 2003....................................................... 1,021,730
1,000,000 AA/Aa Gainesville Regional Utilities Revenue, 5.75%, 2006.......................... 1,044,830
1,020,000 AAA/Aaa Homestead Special Insurance Assessment Revenue, MBIA Insured, Escrowed to
Maturity in Government Securities, 5.25%, 2003............................. 1,038,880
1,000,000 AA/Aa1 Orlando, Utilities Commission Water & Electric Revenue, 5.6%, 2003........... 1,043,480
-----------
5,150,650
-----------
GEORGIA--4.7%
1,000,000 AAA/Aaa Atlanta, Airport Facilities Revenue, AMBAC Insured, 6.25%, 2005#............. 1,067,200
1,500,000 AA+/Aaa Georgia State General Obligation, 5.5%, 2006................................. 1,546,800
500,000 AA-/A1 Metropolitan Atlanta Rapid Transit Authority Sales Tax Revenue, 7.25%,
2010....................................................................... 536,465
250,000 AAA/Aaa Municipal Electric Authority of Georgia Revenue, 7.75%, Prerefunded, 1997*... 260,030
400,000 A/A Municipal Electric Authority of Georgia Special Obligation Revenue, 7.65%,
2003....................................................................... 424,748
-----------
3,835,243
-----------
HAWAII--2.5%
1,000,000 AA/Aa Hawaii State General Obligation, 5.25%, 2000................................. 1,022,860
1,000,000 AA/Aa Honolulu, City and County General Obligation, 5.1%, 2002..................... 1,012,860
-----------
2,035,720
-----------
ILLINOIS--5.0%
1,000,000 AAA/Aaa Chicago, General Obligation, AMBAC Insured, 5.7%, 2007....................... 1,021,400
1,000,000 AA-/Aa1 Illinois Education Facilities Authority Revenue, Northwestern University,
5.5%, 2013................................................................. 962,030
1,000,000 A+/A1 Illinois State Toll Highway Authority Revenue, 6.3%, 2012.................... 1,051,730
1,000,000 A+/A Metropolitan Pier & Exposition Authority, Sales Tax Revenue, 5.75%, 2002..... 1,031,490
-----------
4,066,650
-----------
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
SCHEDULE OF INVESTMENTS--PIONEER INTERMEDIATE TAX-FREE FUND--JUNE 30, 1996
continued
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
STANDARD
& POOR'S/
MOODY'S
PRINCIPAL RATINGS
AMOUNT (UNAUDITED) INVESTMENTS+ VALUE
- ---------------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
INDIANA--1.7%
$ 750,000 A/NR Indiana Municipal Power Agency, Power Supply System Revenue, 7.1%,
Prerefunded, 2000*......................................................... $ 820,335
500,000 A+/A1 Indiana Transportation Finance Authority Highway Revenue, 8.0%,
Prerefunded, 1998*......................................................... 543,920
-----------
1,364,255
-----------
KANSAS--1.9%
1,000,000 AAA/Aaa Kansas City, General Obligation, MBIA Insured, 5.375%, 2010.................. 987,720
500,000 AA/NR Kansas Department of Transportation Highway Revenue, 6.5%,
Prerefunded, 2002*......................................................... 547,295
-----------
1,535,015
-----------
KENTUCKY--2.3%
1,000,000 AAA/Aaa Kentucky Turnpike Authority Revenue, AMBAC Insured, 5.25%, 2005.............. 1,010,720
750,000 A+/A1 Lexington-Fayette Urban County Government Revenue, 7.0%, 2006................ 825,908
-----------
1,836,628
-----------
MAINE--2.5%
250,000 A+/NR Maine Municipal Bond Bank Revenue, 7.15%, Prerefunded, 2001*................. 280,497
245,000 A+/NR Maine Municipal Bond Bank Revenue, 7.65%, Prerefunded, 1998*................. 268,334
1,500,000 AA+/Aa Maine State General Obligation, 5.375%, 2006................................. 1,521,150
-----------
2,069,981
-----------
MARYLAND--3.7%
1,500,000 NR/Aa Maryland Community Development Administration, Single Family Mortgage
Revenue, 5.95%, 2006....................................................... 1,518,105
1,500,000 AA+/Aa University of Maryland Revenue, 5.4%, 2006................................... 1,526,055
-----------
3,044,160
-----------
MASSACHUSETTS--3.8%
1,000,000 A+/A1 Massachusetts Bay Transportation Authority Revenue, 5.5%, 2009............... 991,820
1,000,000 AAA/Aaa Massachusetts Housing Finance Agency, FNMA Collateralized, 6.875%, 2021...... 1,040,220
1,000,000 AA-/Aa Massachusetts Water Pollution Abatement Trust Sewer Revenue, 6.0%, 2008...... 1,039,850
-----------
3,071,890
-----------
MICHIGAN--4.6%
1,500,000 AAA/Aaa Detroit City School District General Obligation, AMBAC Insured, 6.5%, 2008... 1,638,705
1,000,000 AA-/A1 Michigan State Trunk Line Fuel Sales Tax Revenue, Series A, 5.625%, 2003..... 1,038,800
1,000,000 AA-/A1 Michigan State Trunk Line Fuel Sales Tax Revenue, Series B, 5.625%, 2003..... 1,038,800
-----------
3,716,305
-----------
MINNESOTA--1.0%
750,000 AAA/Aa Minnesota Public Facilities Authority Water Pollution Control Revenue, 7.0%,
Prerefunded, 1999*......................................................... 811,598
-----------
MISSOURI--1.2%
1,000,000 NR/Aa Missouri Environmental Improvement & Energy Resource Authority Water
Pollution Control Revenue, 5.15%, 2004..................................... 1,005,250
-----------
NEBRASKA--1.3%
1,000,000 AAA/NR Omaha Public Power District Electric System Revenue, 6.5%, Prerefunded,
2002*...................................................................... 1,091,900
-----------
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
SCHEDULE OF INVESTMENTS--PIONEER INTERMEDIATE TAX-FREE FUND--JUNE 30, 1996
continued
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
STANDARD
& POOR'S/
MOODY'S
PRINCIPAL RATINGS
AMOUNT (UNAUDITED) INVESTMENTS+ VALUE
- ---------------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
NEVADA--0.1%
$ 85,000 AA/Aa Nevada Housing Division Single Family Program Revenue, 8.0%, 2009............ $ 87,811
-----------
NEW HAMPSHIRE--0.7%
500,000 AAA/Aaa New Hampshire Turnpike System Revenue, 7.375%, Prerefunded, 2000*............ 554,485
-----------
NEW JERSEY--3.6%
750,000 AA-/Aaa New Jersey Highway Authority, Garden State Parkway Senior Revenue, 7.25%,
Prerefunded, 1999*......................................................... 813,315
1,000,000 AA/Aa New Jersey Wastewater Treatment Trust Sewer Revenue, 6.5%, 2006.............. 1,102,630
1,000,000 AA+/Aa1 State of New Jersey Sales Tax General Obligation, 5.8%, 2007................. 1,044,800
-----------
2,960,745
-----------
NEW YORK--2.3%
750,000 AA-/Aa Municipal Assistance Corporation for the City of New York Revenue, 7.25%,
Prerefunded, 1996*......................................................... 765,218
500,000 AAA/Aaa New York City Municipal Water Finance Authority Revenue, 7.75%,
Prerefunded, 1998*......................................................... 540,825
500,000 A+/Aaa Triborough Bridge and Tunnel Authority General Purpose Revenue, 7.38%,
Prerefunded, 1998*......................................................... 535,050
-----------
1,841,093
-----------
OHIO--1.2%
1,000,000 AAA/Aaa Cuyahoga County, General Obligation, MBIA Insured, 5.0%, 2007................ 980,530
-----------
OKLAHOMA--3.1%
1,500,000 A-/A Grand River Dam Authority, Electric Revenue, 5.75%, 2006..................... 1,556,190
1,000,000 AA/Aa Oklahoma City, General Obligation, 5.0%, 2004................................ 999,300
-----------
2,555,490
-----------
OREGON--1.0%
250,000 AA-/Aa State of Oregon Veterans Welfare General Obligation, 7.75%, 2003............. 260,840
500,000 AA-/Aa State of Oregon Veterans Welfare General Obligation, 7.0%, 2011.............. 537,370
-----------
798,210
-----------
PENNSYLVANIA--4.6%
1,000,000 A-/NR Pennsylvania Industrial Development Authority Revenue, 7.0%, Prerefunded,
2001*...................................................................... 1,111,260
1,500,000 AA-/A1 Pennsylvania State General Obligation, 6.25%, 2010........................... 1,607,370
1,000,000 A/A1 Pennsylvania State Turnpike Commission Highway Revenue, 5.45%, 2002.......... 1,026,080
-----------
3,744,710
-----------
PUERTO RICO--3.2%
500,000 AAA/NR Puerto Rico Highway Authority Revenue Refunding, 8.0%, Prerefunded, 1998*.... 547,055
1,000,000 AAA/Aaa Puerto Rico Electric Power Authority Revenue, MBIA Insured, 5.0%, 2004....... 1,003,270
1,000,000 AAA/Aaa University of Puerto Rico Revenue, MBIA Insured, 6.25%, 2008................. 1,085,900
-----------
2,636,225
-----------
SOUTH CAROLINA--1.0%
750,000 AAA/Aaa South Carolina Public Service Authority Revenue, 7.0%, Prerefunded, 2001*.... 835,575
-----------
</TABLE>
The accompanying notes are an integral part of these financial statements.
6
<PAGE>
SCHEDULE OF INVESTMENTS--PIONEER INTERMEDIATE TAX-FREE FUND--JUNE 30, 1996
continued
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
STANDARD
& POOR'S/
MOODY'S
PRINCIPAL RATINGS
AMOUNT (UNAUDITED) INVESTMENTS+ VALUE
- ---------------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
TEXAS--7.4%
$1,250,000 AAA/Aaa Dallas, Independent School District General Obligation, Permanent School Fund
Guarantee, 5.3%, 2008...................................................... $ 1,236,700
1,000,000 A/A Houston, Water & Sewer System Revenue, 5.4%, 2000............................ 1,024,830
750,000 AAA/Aaa San Antonio Prior Lien Water Revenue, 7.125%, Prerefunded, 1999*............. 812,445
1,500,000 AA/Aa State of Texas General Obligation, 5.8%, 2004................................ 1,581,285
1,000,000 AA/Aaa Tarrant County, Water Control & Improvement District #001 Revenue, 6.0%,
Prerefunded, 2001*......................................................... 1,052,630
250,000 AAA/Aaa University of Texas Permanent University Fund, Escrowed to Maturity in
Government Securities, 8.0%, 2004.......................................... 298,450
-----------
6,006,340
-----------
UTAH--1.2%
750,000 AA-/Aa Intermountain Power Agency Special Obligation Second Crossover Revenue, 7.5%,
Prerefunded, 1996*......................................................... 765,232
215,000 AA/Aa Utah Housing Finance Agency, Single Family Mortgage Purchase Revenue,
7.3%, 2003++............................................................... 226,778
-----------
992,010
-----------
VERMONT--0.7%
500,000 AAA/Aaa Vermont Municipal Bond Bank, 7.9%, Prerefunded, 1998*........................ 550,515
-----------
VIRGINIA--3.7%
1,000,000 AAA/Aaa Fairfax County, General Obligation, 4.8%, 2003............................... 998,210
1,000,000 AAA/Aaa Portsmouth General Obligation, FGIC Insured, 5.0%, 2007...................... 978,310
1,000,000 AA/Aa Virginia Public School Authority Revenue, 5.4%, 2004......................... 1,025,210
-----------
3,001,730
-----------
WASHINGTON--5.7%
1,000,000 AA+/Aa1 King County, General Obligation, 4.5%, 2003.................................. 967,020
1,000,000 AA/Aa Lewis County, Public Utility District #1, 5.0%, 2004......................... 989,270
800,000 A+/Aaa Metropolitan Seattle Limited Sales Tax General Obligation, 7.2%, Prerefunded,
1997*...................................................................... 829,896
1,000,000 AA/Aa State of Washington General Obligation, 6.0%, 2002........................... 1,056,260
750,000 AA/Aaa State of Washington Motor Vehicle Fuel Tax General Obligation, 7.25%,
Prerefunded, 1999*......................................................... 802,935
-----------
4,645,381
-----------
WISCONSIN--1.3%
1,000,000 AA/Aa State of Wisconsin General Obligation, 5.5%, 2001............................ 1,031,600
-----------
WYOMING--2.2%
750,000 A-/Aa2 Sweetwater County Pollution Control Revenue, 7.625%, 2013.................... 777,937
1,015,000 AA-/NR Wyoming Farm Loan Board Capital Facilities Revenue, 6.25%, 2008.............. 1,054,646
-----------
1,832,583
-----------
TOTAL INVESTMENT IN TAX-EXEMPT SECURITIES (Cost $76,886,271)................. $78,920,558
-----------
</TABLE>
The accompanying notes are an integral part of these financial statements.
7
<PAGE>
SCHEDULE OF INVESTMENTS--PIONEER INTERMEDIATE TAX-FREE FUND--JUNE 30, 1996
continued
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT INVESTMENTS+ VALUE
- ---------------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
TEMPORARY TAX-EXEMPT CASH INVESTMENTS--3.1%
$ 300,000 Jackson County Mississippi, Pollution Control Revenue, Chevron Guarantee,
3.5%, 2016**............................................................... $ 300,000
1,500,000 Peninsula Port Authority, Virginia, Port Facility Revenue, 3.55%, 2005**..... 1,500,000
500,000 Perry County, Mississippi, Pollution Control Revenue, Credit Suisse
Guarantee, 3.55%, 2002**................................................... 500,000
200,000 Uinta County, Wyoming, Pollution Control Revenue, Chevron Corporation
Guarantee, 3.5%, 2020**.................................................... 200,000
-----------
TOTAL TEMPORARY CASH INVESTMENTS (Cost $2,500,000)........................... 2,500,000
-----------
TOTAL INVESTMENT IN SECURITIES AND TEMPORARY CASH INVESTMENTS--100%
(Total Cost $79,386,271)(a)(b)............................................. $81,420,558
===========
</TABLE>
+ The concentration of securities by type of obligation / market sector is as
follows:
<TABLE>
<S> <C>
General Obligation........................................................ 20.6%
Escrowed in U.S. Government Securities.................................... 20.6%
Revenue Bonds:
Education Revenue....................................................... 4.3%
Water & Sewer Revenue................................................... 6.4%
Housing Revenue......................................................... 4.8%
Insured................................................................. 16.0%
Pollution Control Revenue............................................... 3.2%
Power Revenue........................................................... 7.4%
Sales Tax Revenue....................................................... 1.9%
Transportation Revenue.................................................. 9.4%
Other................................................................... 2.3%
Reserves.................................................................. 3.1%
++ A portion of the bond was called on July 1, 1996.
* Prerefunded bonds have been collateralized by U.S. Treasury securities which are held in escrow and used to pay
principal and interest on the tax-exempt issue and to retire the bonds in full at the earliest refunding date.
** Securities with daily "put" features with resetting interest rates. Coupon rates disclosed are as of June 30,
1996.
# When-issued security.
NR Not rated.
(a) At June 30, 1996, the net unrealized gain on investments, based on cost for federal income tax purposes of
$79,386,271 was as follows:
Aggregate gross unrealized gain for all investments in which there is an excess of value over tax
cost................................................................................................. $2,345,477
Aggregate gross unrealized loss for all investments in which there is an excess of tax cost over
value................................................................................................ (311,190)
----------
Net unrealized gain.................................................................................. $2,034,287
==========
(b) At December 31, 1995, the Fund had a net capital loss carryforward of $699,955 which will expire between 2002 and
2003 if not utilized.
Purchase and sales of securities (excluding temporary cash investments) for the six months ended June 30, 1996
aggregated $16,698,285 and $14,550,436, respectively.
</TABLE>
The accompanying notes are an integral part of these financial statements.
8
<PAGE>
BALANCE SHEET--PIONEER INTERMEDIATE TAX-FREE FUND--JUNE 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments in securities, at value (including temporary cash investments of
$2,500,000) (Cost $79,386,271; see Schedule of Investments and Note 1)............. $81,420,558
Cash................................................................................ 53,265
Receivables--
Interest.......................................................................... 1,349,905
Fund shares sold.................................................................. 12,612
Other............................................................................... 2,541
-----------
Total assets................................................................... $82,838,881
-----------
LIABILITIES:
Payables--
Investment securities purchased................................................... $ 3,671,403
Fund shares repurchased........................................................... 41,184
Dividends......................................................................... 118,415
Due to affiliates (Notes 2, 3 and 4)................................................ 75,655
Accrued expenses.................................................................... 57,618
-----------
Total liabilities.............................................................. $ 3,964,275
-----------
NET ASSETS:
Paid-in capital (Note 1)............................................................ $77,699,599
Distributions in excess of net investment income (Note 1)........................... (41,864)
Accumulated net realized loss on investments (Note 1)............................... (817,416)
Net unrealized gain on investments (Note 1)......................................... 2,034,287
-----------
Total net assets............................................................... $78,874,606
===========
NET ASSET VALUE PER SHARE:
Class A--(based on $75,752,143/7,482,300 shares of beneficial interest outstanding--
unlimited number of shares authorized)............................................ $10.12
===========
Class B--(based on $2,922,591/287,818 shares of beneficial interest outstanding--
unlimited number of shares authorized)............................................ $10.15
===========
Class C--(based on $199,872/19,696 shares of beneficial interest outstanding--
unlimited number of shares authorized)............................................ $10.15
===========
MAXIMUM OFFERING PRICE:
Class A............................................................................. $10.49
===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
9
<PAGE>
STATEMENT OF OPERATIONS--PIONEER INTERMEDIATE TAX-FREE FUND
FOR THE SIX MONTHS ENDED JUNE 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME (NOTE 1):
Interest............................................................................ $ 2,221,281
-----------
EXPENSES:
Management fees (Note 2).............................................. $199,730
Distribution fees (Note 4)
Class A.......................................................... 84,620
Class B.......................................................... 14,090
Class C.......................................................... 733
Transfer agent fees (Note 3)
Class A.......................................................... 52,235
Class B.......................................................... 2,220
Class C.......................................................... 347
Registration fees..................................................... 29,480
Professional fees..................................................... 23,006
Accounting (Note 2)................................................... 37,440
Custodian fees........................................................ 9,540
Printing.............................................................. 6,700
Fees and expenses of nonaffiliated trustees........................... 8,390
Miscellaneous......................................................... 10,309
--------
Total expenses................................................... $478,840
Less fees paid indirectly (Note 5)............................... (10,388)
Less management fees waived by Pioneering Management
Corporation (Note 2)........................................... (57,636)
--------
Net expenses................................................................... $ 410,816
-----------
Net investment income...................................................... $ 1,810,465
-----------
REALIZED AND UNREALIZED LOSS ON INVESTMENTS:
Net realized loss on investments (Note 1)........................................... $ (117,461)
Change in net unrealized gain on investments........................................ (2,291,642)
-----------
Net loss on investments........................................................ $(2,409,103)
-----------
Net decrease in net assets resulting from operations....................... $ (598,638)
===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
10
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS--PIONEER INTERMEDIATE TAX-FREE FUND
FOR THE SIX MONTHS ENDED JUNE 30, 1996 AND FOR THE YEAR ENDED DECEMBER 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
------------- -----------------
<S> <C> <C>
FROM OPERATIONS:
Net investment income....................................................... $ 1,810,465 $ 3,905,779
Net realized loss on investments............................................ (117,461) (400,733)
Change in net unrealized gain/loss on investments........................... (2,291,642) 6,979,005
------------ ------------
Net increase (decrease) in net assets resulting from operations......... $ (598,638) $ 10,484,051
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS :
From net investment income
Class A ($0.23 and $0.49 per share, respectively)......................... $ (1,787,879) $ (3,800,009)
Class B ($0.19 and $0.40 per share, respectively)......................... (53,194) (86,280)
Class C ($0.15 and $0.00 per share, respectively)......................... (2,523) --
In excess of net investment income
Class A ($0.01 and $0.00 per share, respectively)......................... (43,701) --
Class C ($0.01 and $0.00 per share, respectively)......................... (210) --
------------ ------------
Decrease in net assets resulting from distributions to shareholders......... $ (1,887,507) $ (3,886,289)
------------ ------------
FROM FUND SHARE TRANSACTIONS:
Net proceeds from sale of shares............................................ $ 5,914,227 $ 7,101,676
Net asset value of shares issued to shareholders in reinvestment of
distributions............................................................. 1,161,523 2,437,890
Cost of shares repurchased.................................................. (7,699,664) (12,355,539)
------------ ------------
Net decrease in net assets resulting from fund share transactions......... $ (623,914) $ (2,815,973)
------------ ------------
Net increase (decrease) in net assets................................... $ (3,110,059) $ 3,781,789
------------ ------------
NET ASSETS:
Beginning of period......................................................... 81,984,665 78,202,876
------------ ------------
End of period (including (distributions in excess of)/accumulated
undistributed net investment income of ($41,864) and $35,178,
respectively)............................................................. $ 78,874,606 $ 81,984,665
============ ============
</TABLE>
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
---------------------- -------------------------
SHARES AMOUNT SHARES AMOUNT
-------- ----------- ---------- ------------
<S> <C> <C> <C> <C>
CLASS A
Shares sold..................................................... 483,107 $ 4,967,491 567,733 $ 5,747,321
Shares issued to shareholders in reinvestment of
distributions................................................. 109,240 1,120,315 233,794 2,382,977
Less shares repurchased......................................... (719,268) (7,376,820) (1,158,605) (11,807,545)
-------- ----------- ---------- ------------
Net decrease................................................ (126,921) $(1,289,014) (357,078) $ (3,677,247)
======== =========== ========== ============
CLASS B
Shares sold..................................................... 71,377 $ 738,812 133,711 $ 1,354,355
Shares issued to shareholders in reinvestment of
distributions................................................. 3,747 38,475 5,360 54,913
Less shares repurchased......................................... (31,298) (317,844) (53,564) (547,994)
-------- ----------- ---------- ------------
Net increase................................................ 43,826 $ 459,443 85,507 $ 861,274
======== =========== ========== ============
CLASS C*
Shares sold..................................................... 19,922 $ 207,924
Shares issued to shareholders in reinvestment of
distributions................................................. 268 2,733
Less shares repurchased......................................... (494) (5,000)
-------- -----------
Net increase................................................ 19,696 $ 205,657
======== ===========
<FN>
- ---------------
* Class C shares were first publicly offered on January 31, 1996.
</FN>
</TABLE>
The accompanying notes are an integral part of these financial statements.
11
<PAGE>
FINANCIAL HIGHLIGHTS--PIONEER INTERMEDIATE TAX-FREE FUND
SELECTED DATA FOR A SHARE OUTSTANDING FOR THE PERIODS PRESENTED
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS
ENDED FOR THE YEARS ENDED DECEMBER 31,
JUNE 30, -------------------------------------------------------------------------
CLASS A 1996 1995 1994++ 1993 1992 1991 1990 1989
------------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period..... $ 10.44 $ 9.62 $ 10.76 $ 10.32 $ 10.06 $ 9.63 $ 9.66 $ 9.40
------- ------- ------- ------- ------- ------- ------- -------
Increase (decrease) from investment
operations:
Net investment income................... $ 0.23 $ 0.49 $ 0.49 $ 0.56 $ 0.59 $ 0.61 $ 0.63 $ 0.63
Net realized and unrealized gain (loss)
on investments........................ (0.31) 0.82 (1.13) 0.56 0.25 0.43 (0.04) 0.26
------- ------- ------- ------- ------- ------- ------- -------
Net increase (decrease) from
investment operations................ $ (0.08) $ 1.31 $ (0.64) $ 1.12 $ 0.84 $ 1.04 $ 0.59 $ 0.89
Distribution to shareholders:
From net investment income.............. (0.23) (0.49) (0.49) (0.56) (0.58) (0.61) (0.62) (0.63)
From net realized gain.................. -- -- (0.01) (0.12) -- -- -- --
In excess of net investment income...... (0.01) -- -- -- -- -- -- --
------- ------- ------- ------- ------- ------- ------- -------
Net increase (decrease) in net asset
value................................... $ (0.32) $ 0.82 $ (1.14) $ 0.44 $ 0.26 $ 0.43 $ (0.03) $ 0.26
------- ------- ------- ------- ------- ------- ------- -------
Net asset value, end of period........... $ 10.12 $ 10.44 $ 9.62 $ 10.76 $ 10.32 $ 10.06 $ 9.63 $ 9.66
======= ======= ======= ======= ======= ======= ======= =======
Total return*............................ (0.76)% 13.80% (6.02)% 11.08% 8.65% 11.17% 6.42% 9.77%
Ratio of net expenses to average net
assets.................................. 1.02%**+ 1.02%+ 1.00% 0.85% 0.85% 0.75% 0.66% 0.60%
Ratio of net investment income to average
net assets.............................. 4.52%**+ 4.77%+ 4.89% 5.23% 5.78% 6.21% 6.56% 6.60%
Portfolio turnover rate.................. 37.29%** 28.75% 39.24% 13.93% 3.52% 4.61% 7.99% 4.09%
Net assets, end of period
(in thousands).......................... $75,752 $79,432 $76,674 $82,097 $57,353 $44,631 $34,118 $28,754
Ratios assuming no waiver of management
fees and assumption of expenses by PMC
and no reduction for fees paid
indirectly:
Net expenses............................ 1.16%** 1.12% 1.22% 1.12% 1.27% 1.33% 1.17% 1.10%
Net investment income................... 4.38%** 4.67% 4.67% 4.97% 5.36% 5.63% 6.05% 6.10%
Ratios assuming waiver of management fees
and assumption of expenses by PMC and
reduction for fees paid indirectly:
Net expenses............................ 1.00%** 1.00% -- -- -- -- -- --
Net investment income................... 4.54%** 4.79% -- -- -- -- -- --
<CAPTION>
OCTOBER 27,
1986 TO
DECEMBER 31,
CLASS A 1988 1987 1986
------- ------- ------------
<S> <C> <C> <C>
Net asset value, beginning of period..... $ 8.95 $ 10.01 $10.00
------- ------- ------
Increase (decrease) from investment
operations:
Net investment income................... $ 0.63 $ 0.62 $ 0.05
Net realized and unrealized gain (loss)
on investments........................ 0.47 (1.02) (0.04)
------- ------- ------
Net increase (decrease) from
investment operations................ $ 1.10 $ (0.40) $ 0.01
Distribution to shareholders:
From net investment income.............. (0.65) (0.66) --
From net realized gain.................. -- -- --
In excess of net investment income...... -- -- --
------- ------- ------
Net increase (decrease) in net asset
value................................... $ 0.45 $ (1.06) $ 0.01
------- ------- ------
Net asset value, end of period........... $ 9.40 $ 8.95 $10.01
======= ======= ======
Total return*............................ 12.79% (3.91)% 0.10%
Ratio of net expenses to average net
assets.................................. 0.50% 0.35% 0.61%**
Ratio of net investment income to average
net assets.............................. 6.89% 7.08% 9.73%**
Portfolio turnover rate.................. 10.03% 0.06% --
Net assets, end of period
(in thousands).......................... $20,121 $13,107 $3,066
Ratios assuming no waiver of management
fees and assumption of expenses by PMC
and no reduction for fees paid
indirectly:
Net expenses............................ 1.28% 1.53% --
Net investment income................... 6.11% 5.90% --
Ratios assuming waiver of management fees
and assumption of expenses by PMC and
reduction for fees paid indirectly:
Net expenses............................ --
Net investment income................... --
<FN>
- ------------
+ Ratios assuming no reduction for fees paid indirectly.
++ The per share data is based upon average shares outstanding for the period
presented.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized.
</FN>
</TABLE>
The accompanying notes are an integral part of these financial statements.
12
<PAGE>
FINANCIAL HIGHLIGHTS--PIONEER INTERMEDIATE TAX-FREE FUND
SELECTED DATA FOR A SHARE OUTSTANDING FOR THE PERIODS PRESENTED
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS YEAR APRIL 29,
ENDED ENDED 1994 TO
JUNE 30, DECEMBER 31, DECEMBER 31,
CLASS B 1996 1995 1994++
---------- ------------- -------------
<S> <C> <C> <C>
Net asset value, beginning of period................................... $10.46 $ 9.65 $10.07
------ ------ ------
Increase (decrease) from investment operations:
Net investment income................................................. $ 0.19 $ 0.41 $ 0.27
Net realized and unrealized gain (loss) on investments................ (0.31) 0.80 (0.42)
------ ------ ------
Net increase (decrease) from investment operations.................. $(0.12) $ 1.21 $(0.15)
Distribution to shareholders from:
Net investment income................................................. (0.19) (0.40) (0.27)
------ ------ ------
Net increase (decrease) in net asset value............................. $(0.31) $ 0.81 $(0.42)
------ ------ ------
Net asset value, end of period......................................... $10.15 $10.46 $ 9.65
====== ====== ======
Total return*.......................................................... (1.14)% 12.71% (1.49)%
Ratio of net expenses to average net assets............................ 1.81%**+ 1.86%+ 1.84%**
Ratio of net investment income to average net assets................... 3.72%**+ 3.90%+ 4.17%**
Portfolio turnover rate................................................ 37.29%** 28.75% 39.24%
Net assets, end of period (in thousands)............................... $2,923 $2,553 $1,529
Ratios assuming no waiver of management fees by PMC and no reduction
for fess paid indirectly:
Net expenses.......................................................... 1.95%** 1.96% 2.14%**
Net investment income................................................. 3.58%** 3.80% 3.87%**
Ratios assuming waiver of management fees by PMC and reduction for fess
paid indirectly:
Net expenses.......................................................... 1.77%** 1.82% --
Net investment income................................................. 3.76%** 3.94% --
<FN>
- ------------
+ Ratios assuming no reduction for fees paid indirectly.
++ The per share data is based upon average shares outstanding for the period
presented.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period and no sales charges.
Total return would be reduced if sales charges were taken into account.
** Annualized.
</FN>
</TABLE>
The accompanying notes are an integral part of these financial statements.
13
<PAGE>
FINANCIAL HIGHLIGHTS--PIONEER INTERMEDIATE TAX-FREE FUND
SELECTED DATA FOR A SHARE OUTSTANDING FOR THE PERIODS PRESENTED (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
JANUARY 31,
1996 TO
JUNE 30,
CLASS C*** 1996
------------
<S> <C>
Net asset value, beginning of period................................... $10.51
------
Increase (decrease) from investment operations:
Net investment income................................................. $ 0.15
Net realized and unrealized loss on investments....................... (0.35)
------
Net decrease from investment operations............................. $(0.20)
Distribution to shareholders:
From net investment income............................................ (0.15)
In excess of net investment income.................................... (0.01)
------
Net decrease in net asset value........................................ $(0.36)
------
Net asset value, end of period......................................... $10.15
======
Total return*.......................................................... (1.91)%
Ratio of net expenses to average net assets............................ 2.12%**+
Ratio of net investment income to average net assets................... 3.39%**+
Portfolio turnover rate................................................ 37.29%**
Net assets, end of period (in thousands)............................... $ 200
Ratios assuming no waiver of management fees by PMC and no reduction
for fess paid indirectly:
Net expenses.......................................................... 2.28%**
Net investment income................................................. 3.23%**
Ratios assuming waiver of management fees by PMC and reduction for fees
paid indirectly:
Net expenses.......................................................... 2.07%**
Net investment income................................................. 3.44%**
<FN>
- ------------
+ Ratios assuming no reduction for fees paid indirectly.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period and no sales charges.
Total return would be reduced if sales charges were taken into account.
** Annualized.
*** Class C shares were first publicly offered on January 31, 1996.
</FN>
</TABLE>
The accompanying notes are an integral part of these financial statements.
14
<PAGE>
NOTES TO FINANCIAL STATEMENTS--PIONEER INTERMEDIATE TAX-FREE FUND
JUNE 30, 1996
- --------------------------------------------------------------------------------
1. Pioneer Intermediate Tax-Free Fund (the Fund) is a Massachusetts business
trust registered under the Investment Company Act of 1940 as a diversified,
open-end management investment company. The investment objective of the Fund is
to provide as high a level of current income exempt from federal income taxes
from a high-quality portfolio of municipal bonds.
The Fund offers three classes of shares -- Class A, Class B and Class C
shares. Class C shares were first publicly offered on January 31, 1996. The
shares of Class A, Class B and Class C represent an interest in the same
portfolio of investments of the Fund and have equal rights to voting,
redemptions, dividends and liquidation, except that each class of shares can
bear different transfer agent and distribution fees and have exclusive voting
rights with respect to the distribution plans that have been adopted by Class A
Class B and Class C shareholders, respectively.
The Fund's financial statements have been prepared in conformity with
generally accepted accounting principles that require the management of the Fund
to, among other things, make estimates and assumptions that affect the reported
amounts of assets and liabilities, the disclosure of contingent assets and
liabilities at the date of the financial statements, and the reported amounts of
revenues and expenses during the reporting periods. Actual results could differ
from those estimates. The following is a summary of significant accounting
policies consistently followed by the Fund, which are in conformity with those
generally accepted in the investment company industry.
A. Security Valuation--Security transactions are recorded on trade date.
Securities are valued based on valuations furnished by an independent pricing
service that utilizes a matrix system. This matrix system reflects such factors
as security prices, yields, maturities, and ratings and is supplemented by
dealer and exchange quotations and fair market value information from other
sources, as required. Market discount and premium are accreted or amortized
daily on a straight-line basis. Original issue discount is accreted daily into
interest income on a yield-to-maturity basis. Temporary cash investments are
valued at amortized cost. Interest income is recorded on the accrual basis.
Gains and losses on sales of investments are calculated on the "identified
cost" method for both financial reporting and federal income tax purposes. It is
the Fund's practice to first select for sale those securities that have the
highest cost and also qualify for long-term capital gain or loss treatment for
tax purposes.
B. Federal Income Taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income and net realized capital
gains, if any, to its shareholders. Therefore, no federal tax provision is
required.
The characterization of distributions to shareholders for financial reporting
purposes is determined in accordance with federal income tax rules. Therefore,
the source of the Fund's distributions may be shown in the accompanying
financial statements as either from or in excess of net investment income or net
realized gain on investment transactions, or from paid-in capital, depending on
the type of book/tax differences that may exist.
C. Fund Shares--The Fund records sales and repurchases of its shares on trade
date. Net losses, if any, as a result of cancellations, are absorbed by Pioneer
Funds Distributor, Inc. (PFD), the principal underwriter for the Fund and an
indirect subsidiary of The Pioneer Group, Inc. (PGI). PFD earned $7,991 in
underwriting commissions on the sale of fund shares during the six months ended
June 30, 1996. The Fund declares as daily dividends substantially all of its net
investment income. All dividends are paid on a monthly basis. Short-term capital
gain distributions, if any, may be declared with the daily dividends. Dividends
paid by the Fund, if any, with respect to each class of shares are calculated in
the same manner, at the same time, on the same day and in the same amount,
except that Class A, Class B and Class C shares bear different transfer agent
and distribution fees.
D. Class Allocations--Distribution expenses are calculated based on the average
daily net asset value attributable to Class A, Class B and Class C shares of the
Fund, respectively. Shareholders of
15
<PAGE>
NOTES TO FINANCIAL STATEMENTS--PIONEER INTERMEDIATE TAX-FREE FUND
JUNE 30, 1996--continued
- --------------------------------------------------------------------------------
each class share all expenses and fees paid to the transfer agent, Pioneering
Services Corporation (PSC), for their services, which are allocated based on the
number of accounts in each class and the ratable allocation of related
out-of-pocket expense (see Note 3). Income, common expenses and realized and
unrealized gains and losses are calculated at the Fund level and allocated daily
to each class of shares based on the respective percentage of adjusted net
assets at the beginning of the day.
2. Pioneering Management Corporation (PMC), the Fund's investment adviser,
manages the Fund's portfolio, and is a wholly owned subsidiary of PGI.
Management fees are calculated daily at the annual rate of 0.50% of the average
daily net assets.
PMC has agreed not to impose a portion of its management fees and to assume
other operating expenses of the Fund to the extent necessary to limit Class A
expenses to 1.00% of the average daily net assets attributable to Class A
shares; the portion of the Fund-wide expenses attributable to Class B and Class
C shares will be reduced only to the extent that such expenses are reduced for
the Class A shares. PMC's agreement is voluntary and temporary and may be
revised or terminated at any time.
In addition, under the management agreement, certain other services and costs,
including accounting, regulatory reporting and insurance premiums, are paid by
the Fund. Included in due to affiliates is $19,963 and $4,647 in management and
accounting fees, respectively, payable to PMC at June 30, 1996.
3. PSC, a wholly owned subsidiary of PGI, provides substantially all transfer
agent and shareholder services to the Fund at negotiated rates. Included in due
to affiliates is $11,842 in transfer agent fees payable to PSC at June 30, 1996.
4. The Fund adopted a Plan of Distribution for each Class of shares (Class A,
Class B and Class C Plan) in accordance with Rule 12b-1 of the Investment
Company Act of 1940. Pursuant to the Class A Plan, the Fund pays PFD a service
fee of up to 0.25% of the Fund's average daily net assets in reimbursement of
its actual expenditures to finance activities primarily intended to result in
the sale of Class A shares. Pursuant to the Class B Plan and Class C Plan, the
Fund pays PFD 1.00% of the average daily net assets attributed to each class of
shares. The fee consists of a 0.25% service fee and a 0.75% distribution fees
paid as compensation for personal services and/or account maintenance services
or distribution services with regard to Class B and Class C shares. Included in
due to affiliates is $39,203 in distribution fees payable to PFD at June 30,
1996.
In addition, redemptions of each class of shares may be subject to a
contingent deferred sales charge (CDSC). A CDSC of 1.00% may be imposed on
certain net asset value purchases of Class A shares that are redeemed within one
year of purchase. Class B shares that are redeemed within six years of purchase
are subject to a CDSC at declining rates beginning at 3.0%, based on the lower
of cost or market value of shares being redeemed. Redemptions of Class C shares
within one year of purchase are subject to a CDSC of 1.00%. Proceeds from the
CDSC are paid to PFD. For the six months ended June 30, 1996, CDSCs in the
amount of $6,237 were paid to PFD.
5. The Fund has entered into certain expense offset arrangements resulting in a
reduction in the Fund's total expenses. For the six months ended June 30, 1996,
the Fund's expenses were reduced by $10,388 under such arrangements.
16
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
- --------------------------------------------------------------------------------
TO THE SHAREHOLDERS AND THE BOARD OF TRUSTEES OF PIONEER INTERMEDIATE TAX-FREE
FUND:
We have audited the accompanying balance sheet of Pioneer Intermediate Tax-Free
Fund, including the schedule of investments, as of June 30, 1996, and the
related statement of operations, statements of changes in net assets and
financial highlights for the periods presented. These financial statements and
financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of June
30, 1996 by correspondence with the custodian. An audit also includes assessing
the accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Pioneer Intermediate Tax-Free Fund as of June 30, 1996, the results of its
operations, the changes in its net assets and financial highlights for the
periods presented, in conformity with generally accepted accounting principles.
ARTHUR ANDERSEN LLP
Boston, Massachusetts
August 1, 1996
17
<PAGE>
PIONEER INTERMEDIATE
TAX-FREE FUND
60 STATE STREET
BOSTON, MASSACHUSETTS 02109
OFFICERS
John F. Cogan, Jr., Chairman and
President
David D. Tripple, Executive Vice
President
Kathleen D. McClaskey, Vice
President
William H. Keough, Treasurer
Joseph P. Barri, Secretary
TRUSTEES
<TABLE>
<S> <C>
John F. Cogan, Jr. Marguerite A. Piret
Richard H. Egdahl, M.D. David D. Tripple
Margaret B.W. Graham Stephen K. West
John W. Kendrick John Winthrop
INVESTMENT ADVISER LEGAL COUNSEL
Pioneering Management Hale and Dorr
Corporation
CUSTODIAN PRINCIPAL UNDERWRITER
Brown Brothers Pioneer Funds
Harriman & Co. Distributor, Inc.
SHAREHOLDER SERVICES
AND TRANSFER AGENT
Pioneering Services
Corporation
60 State Street
Boston, Massachusetts 02109
INDEPENDENT PUBLIC ACCOUNTANTS
Arthur Andersen LLP
- ------------------------------------------------------
Please call Pioneer for information on:
Existing accounts, new accounts,
prospectuses, applications, and
service forms..................... 1-800-225-6292
Fund yields and prices............ 1-800-225-4321
Toll-free fax..................... 1-800-225-4240
Retirement plans.................. 1-800-622-0176
Telecommunications Device for the
Deaf (TDD)........................ 1-800-225-1997
- ------------------------------------------------------
</TABLE>
When distributed to persons who are
not shareowners of the Fund, this
report must be accompanied by a
current prospectus, which discusses
the objectives, policies and other
information concerning the Fund.
0896-3592
[Copyright] Pioneer Funds Distributor, Inc.
[LOGO]
Pioneer
Intermediate
Tax-Free Fund
SEMIANNUAL REPORT
JUNE 30, 1996
