SCUDDER FUND, INC.
Annual Report
December 31, 1994
A closed-end investment company seeking long-term capital appreciation
through investment in securities, primarily equity securities, of Asian
companies.
Scudder New Asia Fund, Inc.
Investment objective and policies
* long-term capital appreciation through investment primarily in equity
securities of Asian companies
Investment characteristics
* a closed-end investment company investing in a broad spectrum of Asian
companies and industries
* a vehicle for international diversification through participation in
Asian stock markets
General Information
Executive offices
Scudder New Asia Fund, Inc.
345 Park Avenue
New York, NY 10154
Telephone:
Daily net asset value: 212-326-6444
For Fund Information: 1-800-349-4281
Transfer agent, registrar and dividend reinvestment plan agent
For account information: 617-328-5000 x6406
State Street Bank and Trust Company
P.O. Box 8200
Boston, MA 02266-8200
Custodian
Brown Brothers Harriman & Co.
Legal counsel
Dechert Price & Rhoads
Independent Accountants
Coopers & Lybrand L.L.P.
New York Stock Exchange Symbol--SAF
This report is sent to the shareholders of Scudder New Asia Fund, Inc. for
their information. It is not a prospectus, circular, or representation
intended for use in the purchase or sale of shares of the Fund or of any
securities mentioned in the report.
Contents
Letter to Shareholders 3
Investment Summary 8
Portfolio Summary 9
Investment Portfolio 10
Financial Statements 16
Financial Highlights 19
Notes to Financial Statements 20
Report of Independent 25
Accountants
Tax Information 26
Dividend Reinvestment and 27
Cash Purchase Plan
Investment Manager 29
Directors and Officers 30
Letter to Shareholders
Dear Shareholders:
On December 31, 1994 the net asset value (NAV) per share of your Fund
was $17.44, down from $25.06 on December 31, 1993. On January 17, 1995 the
Fund paid a distribution of $0.02 per share from net investment income,
$0.17 per share from short-term capital gains and $4.03 per share from
long-term capital gains for a total distribution of $4.22 per share to
shareholders of record at the close of business on December 30, 1994.
Shares of your Fund sold at year-end on the New York Stock Exchange
(NYSE) at a price of $20.375 per share. However, these shares ultimately
yielded only $16.155 to those shareholders who sold such shares net of the
attached due-bill of $4.22 per share. A due-bill represents an obligation
on the part of the seller of Fund shares to make a payment to the buyer of
such shares on the payment date of the distribution that gave rise to the
due-bill. Because your Fund declared a distribution that was greater than
15% of the market value of its shares, due-bill trading was mandated by the
NYSE. Accordingly, rather than reducing the trading price of the Fund's
shares by the amount of the distribution (the normal ex-dividend
procedure), due-bills were attached to shares of the Fund that traded
during the period beginning four business days prior to record date and
ending on the payment date of the distribution. Because of the due-bill, it
is our view that $16.155 is more reflective of the true market value of the
Fund at year-end and should be used in comparisons to historical market
values and the year-end NAV. For information on the Fund's performance,
please refer to the table on page 8 entitled "Investment Summary."
The Portfolio
At year-end the Fund was approximately 88% invested in equity
securities, convertible bonds and other securities, with approximately 12%
held in short-term money market instruments. As shown in the table below,
equity investments remain concentrated in Japan, Hong Kong, and Malaysia.
Because we were concerned about overheating in the Hong Kong stock market
we reduced the Hong Kong weight, and added to Japan, which looked
relatively stable. Due to this portfolio adjustment and the relative
strength/weakness of the two markets, the Japan weight rose substantially,
almost doubling, from 14.7% to 27.9% of the equity portfolio during the
year. The Fund's portfolio weighting in Hong Kong securities fell from
26.9% to 15.7% over the twelve month period. The cash weighting was high at
the end of calendar 1994 but this money was earmarked to pay out the large
1994 capital gain dividend. This means that the Fund will be almost fully
invested as we go into the new year. The dividend was large due primarily
to the fact that selling Hong Kong stocks as mentioned above resulted in
realizing substantial capital gains on long term holdings.
<TABLE>
Geographic Diversification of Common Stock and
Convertible Holdings
(as a percentage of the Fund's equity portfolio)
1994 Return
in Local
12/31/93 12/31/94 Currency Terms
--------- --------- --------------
<S> <C> <C> <C>
Japan 14.7% 27.9% +8%
Hong Kong 26.9 15.7 -31
Malaysia 12.6 10.5 -24
South Korea 8.0 10.3 +19
Thailand 11.9 7.4 -19
Indonesia 5.5 6.9 -20
Philippines 3.8 4.9 -13
India 3.2 4.0 +17
Taiwan 1.8 3.4 +17
Singapore 2.9 2.9 -8
China 0.7 1.7 -45
Pakistan 0.9 0.7 -5
</TABLE>
Economic Overview
The economies in the New Asia universe grew somewhat less rapidly in
1994 than in 1993. The region nonetheless remained the fastest growing in
the world, with GDP growth likely to continue at around 6% or more.
Inflation became a concern in some countries, particularly China. Rising
interest rates globally also began to have an impact on the region, most
notably in Hong Kong where real estate plays such a key role in the economy
and stock market. Towards year-end, peso devaluation in Mexico rocked
trading in some Asian currencies, notably the Hong Kong dollar and the Thai
baht.
However, this effect was rather shortlived as governments proved able to
defend their currencies. Overall trade and investment remained strong as
Asian countries benefitted from full-fledged economic recoveries in the
U.S. and Europe. Another important factor was newly vibrant demand from
Japan which arose thanks to nascent economic recovery and growing demand
for low-cost imported goods. At the same time, trade and investment within
the Asian region itself proved brisk, giving further impetus to the
"virtuous circle" of economic growth.
Hong Kong
The Hang Seng, which rose an astonishing 116% in 1993, fell a
disappointing 31% in 1994. In a classic reversal, the two factors that had
fueled 1993's enthusiasm--low interest rates and China euphoria--came to
an end. Property-related stocks fell 40% in 1994. Major declines in the
stock and property markets notwithstanding, the Hong Kong economy keeps
growing. Consensus estimates are calling for 5.5% GDP growth for both 1994
and 1995, fueled by strong world growth and local infrastructure spending.
The Fund is currently underweighted in Hong Kong. We are taking advantage
of market decline to augment holdings, particularly in stable earners such
as China Light and Power. The trajectory of U.S. interest rates and Chinese
political succession remain the single biggest factors behind the outlook
for Hong Kong's stock market. For the time being we remain cautious.
China
We believe that the biggest problem for China's economy in 1994 was
inflation, which soared into the high 20% range. Rapid monetary growth from
investment inflows is a major culprit. Real GDP growth for 1994 is expected
to be close to 11%, down from 1993's 13%. The government is still trying to
slow things down so as to prevent "runaway" inflation. They are aiming
somewhat ambitiously to hold growth to 9% and inflation to 15% in 1995. In
hopes of achieving this, the government has begun to liquidate some
unprofitable state operated enterprises. The number of enterprises targeted
is small however, and other than a possible demonstration effect the impact
may be minor. True reform would likely be far too socially disruptive to
attempt during a time of political transition. Deng Xiaoping's health is
reportedly fading fast. Many China observers expect the transfer of power
will be smooth initially, but jockeying for power is likely to continue for
some time after Deng's passing. The ultimate outcome is unclear. A
perfectly smooth transition is by no means the only possible scenario. The
Fund's China exposure is small in H and N shares which are listed in Hong
Kong and New York, respectively. The Fund's holdings include two power
companies, Tsingtao Brewery and a chemical fiber company, Yi Zheng.
Malaysia
The year 1994 was a tough one for Malaysian stocks, which fell 24%,
letting steam out of a market that had risen 98% in 1993. Interest rates
are the biggest issue surrounding the Malaysian stock market since rates
have lagged rises elsewhere. Another concern is the trade deficit. Imports
are mostly capital goods, but consumer and auto imports are rising. Policy
tightening should address both these issues but would be a short term
negative for the market. On the plus side, inflation remains below 4% and
the economy is expected to grow in excess of 8% (again) in 1995. We believe
that corporate fundamentals remain sound, and upturns in palm oil, rubber
and even oil prices appear to be big pluses for Malaysia. In 1994 the Fund
has been underweighted in Malaysia, but we expect to add Malaysian
securities to the portfolio as the interest rate picture becomes clearer.
Current holdings include infrastructure-related companies such as United
Engineers Malaysia and YTL, and TRI, the telecommunications company.
Indonesia
Political worries and heightened perception of emerging market risk
hurt Indonesia's stock market in 1994, bringing it down 20% in local
currency and taking back some of 1993's incredible 115% rise. Yet
underlying growth continued strong with earnings of index-listed stocks
projected to rise approximately 40% for the year just ended and
approximately 30% for calendar 1995. The government has maintained strict
fiscal discipline, and the budget for 1995/96 appears once again to be
balanced. Pricing strength in commodities also bodes well. A weakening yen
would also be a positive, since most of the country's assistance loans are
yen denominated. Furthermore, Indonesia is "ahead of the curve" as far as
raising interest rates is concerned, which also makes the country's stock
market relatively less vulnerable than those countries with more upside on
rates. Looking forward, the succession issue--what will a post-Suharto era
look like--will cast uncertainty. On balance though we are very
enthusiastic about Indonesia's prospects and remain overweighted. Keeping
in mind Indonesia's huge population of 190 million people, we particularly
like beneficiaries of rising living standards such as Kalbe Farma, the drug
and food company, as well as the housing company, PT Jaya Real Estate.
Thailand
Hit by last year's rise in U.S. interest rates, the Thai stock market
fell 19% in 1994 after a rise of 88% the previous year. The economy
continues growing strongly, with GDP for both 1994 and 1995 expected to
grow in excess of 8%, but there are some concerns. These include: the pace
of consumer spending growth relative to capital expenditure; a jump in
inflation in 1994; rising interest rates, with more to come; and a large
and rising current account deficit in 1994. These concerns led currency
speculators to target the Thai baht following the Mexican peso crisis, but
this attack was successfully deflected by the Bank of Thailand. We believe
that Thailand's case is different from Mexico for the following reasons:
inflation for 1995 is expected to be under 5%; the current account deficit
is likely to remain flat or decline in '95; Thailand's export sector is
performing strongly; and the government is expected to report yet another
surplus in fiscal year '95. While there can be no assurances, we are
enthusiastic about the government's plan to get more savings into the
formal financial system, and see this as a positive for the stock market
farther out, as well as for one of the Fund's core portfolio holdings, Thai
Farmers Bank.
Japan
The Tokyo stock market was a bright spot in 1994 following several
years of negative contribution. The underlying economy remains mixed,
however. Third quarter annualized GDP growth accelerated to 3.7%, led by
growth in consumption, housing and government spending. Private capital
expenditures turned positive for the first time since 1991, but real GDP
growth for calendar year 1994 will likely come in at only 0.9%. Further,
while real economic growth accelerated, inflation declined 2.9% annually,
the first such decline since 1987 and the largest decline in post-WWII
history. This means that while "real" economic growth is improving,
deflationary pressure is dampening recovery in corporate sales. Net exports
declined by 0.5% due to a surge in imports, mainly from Asia. After
factoring in the effects of the Kobe earthquake of January 1995, we expect
1995's real GDP growth to reach about 2.5%. This projected rate is well
below growth levels at analogous points in past economic recoveries. It is
based on our expectation of muted acceleration in net exports and private
capital expenditures. Our diversified Japan portfolio includes telecom
company DDI, global camera and copier maker Canon and venture capital
company JAFCO. The Fund's weighting in Japan is currently above neutral. We
intend to reallocate across Asian markets as they stabilize.
Korea
Despite a sharp selloff at year end, Korea's stock market still
managed to show a 19% gain in local currency terms, thanks to economic
growth--in excess of 8% for calendar year 1994. Earnings of listed
companies are impressive, having risen 70% in 1994 and, we believe, being
likely to rise another 20-25% in 1995. Industrial production is growing at
double-digit pace, particularly in areas benefitting from the cyclical
global economic upturn, such as heavy industry and chemicals. Estimates
call for 7.4% GDP growth for the full year. As might be expected, inflation
may rise, to above 6% in 1995 from 1994's 5% range, and monetary policy in
1995 is likely to be tighter than in 1994. Another important issue for
Korean stocks in 1995 will be the large number of new issues and rights
issues coming to market, which should forestall overheating. Despite the
advanced age of the current economic cycle, we remain enthusiastic about
the prospects for Korean equities. Holdings include Daewoo Heavy and
Samsung Electronics.
Taiwan
The main factor influencing Taiwan's stock market in 1994 was arguably
the general election. The satisfying victory of the ruling party encouraged
business interests and the stock market, which responded very positively,
rising 17% in local currency terms. Feuding with the PRC was also a
feature, notably in reaction to an incident involving the murder of
Taiwanese tourists, but the year-end announcement of direct shipping from
Taiwan to the PRC seemed to herald better relations and business
opportunities ahead. GDP growth is strong--likely to be in excess of 6%
for 1994 and 1995. Export growth, particularly in the electronics sector is
quite brisk and new capacity expansion continues into strong global demand.
Corporate earnings grew around 20% over the course of 1994; they are
expected to slow to a "low teens" pace in 1995 as rising interest rates
begin to bite. The Fund maintains a moderate position in Taiwan given the
stock market's strong outperformance relative to its neighbors in 1994.
Companies we like include TECO Electric and Machine, and United Micro
Electronics.
The Philippines
Tighter liquidity caused by rising U.S. interest rates also affected
last year's Philippine stock market performance. The market fell 13% in
1994 after the impressive 154% rise in 1993. As with the other Asian
markets, economic fundamentals continue to be strong. We remain impressed
by the government's resolve in turning the country onto the path of growth
even when doing so involved implementing politically unpopular measures
such as a value added tax. The outlook is currently favorable for interest
rates, exchange rates and inflation. Investment and export growth are
strong. GDP growth for 1994 and 1995 are projected at 4.5% and 5.4%
respectively, with a further increase likely for 1996. The business
environment appears to continue to improve and earnings are projected to
grow approximately 25% in 1995. We maintain a positive stance toward the
Philippines, gaining broad exposure to the economy through conglomerates
Ayala Corp and Benpres.
India
The darling of emerging markets enthusiasts in 1994, India's stock
market rose 17% in local terms despite a sharp selloff at year end. At
issue is the outlook for the reform efforts spearheaded by Prime Minister
Rao now that his Congress party's candidate for a seat in the state
assembly has been beaten in his home district. Our view is that the pace of
reforms may be slower than initially projected, but that the momentum
already established will keep the proposed measures on track. Economic
growth is speeding up with GDP expected to rise from around 5% in 1994 to
around 5.5% in 1995. We believe that the capital which was raised in 1994
will be put to work, and the resultant capital expenditure boom can be
expected to power the economy through 1996 and beyond. The Fund is
overweighted in Indian stocks. Holdings include basic infrastructure
companies such as steel manufacturer Jindal Strips and beneficiaries of
rising incomes such as pharmaceutical producer Ranbaxy and moped maker
Bajaj Auto.
Singapore
Despite its status as a "safe haven" among Asian markets, Singapore's
stock market also fell in response to the increase in U.S. interest rates.
The index slumped 8% in 1994, compared to 59% in 1993. GDP growth for 1994
is expected to be around 9% and 8% growth is projected for 1995. Exports
remain strong in the electronics area. Industrials and shipping are
recovering. Corporate earnings growth is expected to accelerate from almost
17% in 1994 to around 20% in 1995. Looking forward, declining
competitiveness in export markets due to the appreciation of the Singapore
dollar and the rising sophistication of manufacturing in other primarily
Asian countries with lower labor costs is a concern. Rising interest rates
may also pose a threat to somewhat inflated real estate values. The Fund is
underweighted in Singapore. Our holdings include: Overseas Union Bank,
which benefits from the commerce sector's buoyancy and from strong consumer
loans, and conglomerate Sembawang, with its large exposure to the reviving
shipping sector.
Outlook for Asian Stock Markets
The year 1994 was a difficult one for investing in Asian stock markets
as a group. 1994 took back some of what 1993 gave, but not all. We do not
expect 1995 to be like 1994, but neither do we expect it to look like 1993.
In one sense, 1994 was an unusual year due to an unusual 1993 in which
markets grew as much as 100%. Yet in another sense '93 and '94 were not
unusual because volatility in Asian markets is to be expected. The Fund's
policy for dealing with this volatility is to diversify across many
markets, industries and companies, and to maintain a long-term investment
stance.
In the wake of the Mexican peso crisis, global investors have become
much more sensitive to risk. Stock valuations look more reasonable than
they did a year ago, but with the "gold rush" mentality of 1993 behind us,
investors are unwilling to pay up for or to hold high-priced stocks. We
anticipate that this attitude, together with increasingly attractive
alternatives in less risky investments due to higher interest rates, could
moderate the immediate upside potential of Asian equities. At the same
time, while there can be no assurances, we expect our investments in Asia
will yield a satisfying total return over the years to come, based on the
dynamic economic growth described above and to the wide array of excellent
companies from which we can choose to invest. Although turbulence will
remain a feature of these markets, the opportunity and excitement of
investing in New Asia remain as compelling as ever.
A Team Approach to Investing
Scudder New Asia Fund, Inc. is managed by a team of Scudder investment
professionals who each play an important role in the Fund's management
process. Team members work together to develop investment strategies and
select securities for the 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. We believe our team approach benefits Fund investors by bringing
together many disciplines and leveraging Scudder's extensive resources.
Lead Portfolio Manager Elizabeth J. Allan assumed responsibility for
the Fund's day-to-day management and investment strategies in February
1994. Ms. Allan, who has been a member of the Fund's team since its
inception in 1987, has 12 years of Pacific Basin research and investment
management experience. Nicholas Bratt, Portfolio Manager, has been a member
of the Fund's team since 1987 and helps set the Fund's general investment
strategies. Mr. Bratt has over 20 years of experience in worldwide
investing, including 19 years of experience as a portfolio manager, and has
been at Scudder since 1976. Seung Kwak, Portfolio Manager, has directed our
Tokyo-based research effort since he joined Scudder in 1988. Joyce E.
Cornell, Portfolio Manager, focuses on stock selection, a role she has
played since she joined Scudder in 1991. Ms. Cornell has eight years of
investment experience as a research analyst. Eileen O. Gerspach, Portfolio
Manager, helps set the Fund's general investment strategies. Ms. Gerspach,
who joined the team in 1994, has worked in the investment industry since
1984 and has eight years of experience as a portfolio manager.
Dividend Reinvestment Plan
The Fund's Dividend Reinvestment and Cash Purchase Plan offers you a
convenient way to have your dividends and capital gain distributions
reinvested in shares of the Fund. Its features are more fully described on
page 27.
We are pleased that you are an investor in Scudder New Asia Fund, Inc.
We would be happy to receive any questions or comments. You can reach us at
1-800-349-4281.
Respectfully,
/s/Nicholas Bratt /s/Edmond D. Villani
Nicholas Bratt Edmond D. Villani
President Chairman of the Board
<PAGE>
Scudder New Asia Fund, Inc.
Investment Summary as of December 31, 1994
- - -----------------------------------------------------------------------------
Historical
Information
Life of Fund
Total Return (%)
----------------------------------------------
Market Value Net Asset Value(a)
------------------- -------------------
Average Average
Cumulative Annual Cumulative Annual
------------------- -------------------
Quarterly -15.91 -- -9.09 --
One Year -25.10 -25.10 -11.67 -11.67
Three Year 42.79 12.61 56.06 15.99
Five Year 63.02 10.27 70.77 11.30
Life of Fund* 135.99 12.06 173.94 14.30
- - -----------------------------------------------------------------------------
Per Share Information and Returns (a)
Yearly periods ended December 31
A chart in the form of a bar graph appears here,
illustrating the Fund Total Return (%) and Index Total
Return (%) with the exact data points listed in the table
below.
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1987* 1988 1989 1990 1991 1992 1993 1994
--------------------------------------------------------------
Net Asset Value... $10.81 $12.04 $16.36 $13.44 $14.94 $14.73 $25.06 $17.44
Income Dividends.. $ .02 $ .05 $ -- $ .08 $ .08 $ .08 $ .32 $ .23
Capital Gains
Distributions $ -- $ -- $ 1.38 $ 2.11 $ .11 $ .43 $ .08 $ 4.20
Total Return (%).. -2.93 11.78 47.84 -2.77 12.54 1.94 73.32 -11.67
</TABLE>
(a) Performance is historical and assumes reinvestment of all dividends and
capital gains. These percentages are not an indication of the
performance of a shareholder's investment in the Fund based on market
value due to differences between the market price of the stock and the
net asset value of the Fund during each period.
* The Fund commenced operations on June 25, 1987.
Past results are not necessarily indicative of future performance
of the Fund.
Scudder New Asia Fund, Inc.
Portfolio Summary as of December 31, 1994
- - -----------------------------------------------------------------------------
Diversification
- - -----------------------------------------------------------------------------
- - ---------------------------
Common Stocks 82%
Convertible Bonds 5%
Limited Partnership 1%
Cash Equivalents 12%
----
100%
====
A graph in the form of a pie chart appears here,
illustrating the exact data points in the above table.
Geographical breakdown of Sector breakdown of the Fund's
the Fund's equity securities equity securities
- - --------------------------- -----------------------------------
Japan 28% Financial 22%
Hong Kong 16% Manufacturing 18%
Malaysia 11% Communications 10%
Korea 10% Metals and Minerals 7%
Thailand 7% Construction 6%
Indonesia 7% Consumer Staples 6%
Pakistan/India 5% Consumer Discretionary 5%
Philippines 5% Durables 5%
Singapore 3% Utilities 5%
Other 8% Other 16%
---- ----
100% 100%
==== ====
Two graphs in the form of pie charts appear here, illustrating the exact
data points in the above tables.
- - ---------------------------------------------------------------------------
Ten Largest Equity Holdings
- - ---------------------------------------------------------------------------
1. Korea Mobile Telecom
Korea's largest mobile telephone communication company
2. Samsung Electronics Co., Ltd.
Major electronics manufacturer
3. Freeport McMoRan Copper and Gold, Inc. "A"
U.S. company mining in Indonesia
4. Thai Farmers Bank, Ltd.
Commercial bank
5. Technology Resources Industries
Malaysian mobile telephone operator
6. Modern Photo Film Co.
Photographic film distributor
7. Henderson Land Development Co., Ltd.
Hong Kong property developer
8. Hong Kong Electric Holdings, Ltd.
Electric utility and real estate
9. Canon Inc.
Leading producer of visual image and information equipment
10. Hong Kong Telecommunications, Ltd.
Telecommunication services
<PAGE>
<TABLE>
Scudder New Asia Fund, Inc.
Investment Portfolio as of December 31, 1994
- - --------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Principal Market
Amount ($) Value ($)
- - --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
COMMERCIAL PAPER -- 12.5%
UNITED STATES 10,134,000 CIT Group Holdings Inc., 6.05%,1/3/95 . . . . . . . . . . . . . . 10,130,594
8,000,000 Emerson Electric Co., 5.80%,1/5/95 . . . . . . . . . . . . . . . 7,994,844
4,350,000 Ford Motor Credit Co., 5.80%,1/6/95 . . . . . . . . . . . . . . . 4,346,496
----------
TOTAL COMMERCIAL PAPER (Cost $22,471,934) . . . . . . . . . . . . 22,471,934
----------
- - --------------------------------------------------------------------------------------------------------------------------
CONVERTIBLE BONDS -- 4.7%
INDIA 1.5% 470,000 Essar Gujarat, 5.5%, 8/5/98 (Steel producer) . . . . . . . . . . 813,100
1,070,000 Industrial Credit & Investment Corp. of India, Ltd.,
2.5%, 4/3/00 (Development bank) . . . . . . . . . . . . . . . . 786,450
700,000 Jindal, 4.25%, 3/31/99 (Steel manufacturer) . . . . . . . . . . . 714,000
400,000 Reliance Industries, 3.5%, 11/3/99 (Producer of textiles,
synthetic fibers and plastics) . . . . . . . . . . . . . . . . 440,000
----------
2,753,550
----------
KOREA 1.1% 500,000 Cheil Food and Chemical Co., Ltd., 3%, 12/31/06
(Leading sugar refiner and major integrated food processor) . . 655,000
1,000,000 Ssangyong Cement Industrial Co., Ltd., 3%, 12/31/05
(Major cement producer) . . . . . . . . . . . . . . . . . . . . 1,340,000
----------
1,995,000
----------
MALAYSIA 0.5% 1,065,000 Telekom Malaysia Berhad, 4%, 10/3/04
(Telecommunication services) . . . . . . . . . . . . . . . . . 942,525
----------
TAIWAN 1.6% 2,040,000 TECO Electric & Machinery, 2.75%, 4/15/04
(Manufacturer of household appliances and
computer products) . . . . . . . . . . . . . . . . . . . . . . 1,856,400
625,000 United Microelectronics Corp., Ltd., 1.25%, 6/8/04
(Semiconductor manufacturer). . . . . . . . . . . . . . . . . . 965,625
----------
2,822,025
----------
TOTAL CONVERTIBLE BONDS (Cost $9,115,900) . . . . . . . . . . . . 8,513,100
----------
- - --------------------------------------------------------------------------------------------------------------------------
LIMITED PARTNERSHIP -- 0.5%
JAPAN 1 JAFCO #6 Investment Enterprise Partnership (b) (Venture
capital company) (Cost $773,606). . . . . . . . . . . . . . . . 974,530
----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
<TABLE>
<CAPTION>
Market
Shares Value ($)
- - ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
COMMON STOCKS -- 82.3%
CHINA 1.5% 57,000 Huaneng Power International, Inc. Series N (ADR)
(Developer and operator of large coal-fired
power plants) . . . . . . . . . . . . . . . . . . . . . . . . . . 840,750
75,000 Shandong Huaneng Power Co. (ADR) (Electric
power utility) . . . . . . . . . . . . . . . . . . . . . . . . . 721,875
1,000,000 Tsingtao Brewery "H" (Leading brewery) . . . . . . . . . . . . . . . 549,323
1,534,000 Yi Zheng Chemical Fibre Co. (Leading polyester producer) . . . . . . 570,035
-----------
2,681,983
-----------
HONG KONG 13.7% 2,219,182 B & B Asia Ltd. (General construction company) . . . . . . . . . . 355,675
423,000 China Light & Power Co., Ltd. (Electric utility) . . . . . . . . . . 1,809,702
189,687 HSBC Holdings Ltd. (Bank) . . . . . . . . . . . . . . . . . . . . . 2,047,211
630,500 Henderson Land Development Co., Ltd (Property
developer) . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,015,265
246,000 Hong Kong Aircraft Engineering Co., Ltd. (Commercial
aircraft maintenance company) . . . . . . . . . . . . . . . . . . 820,339
1,084,000 Hong Kong Electric Holdings, Ltd. (Electric utility and real estate) 2,963,318
1,394,800 Hong Kong Telecommunications, Ltd.
(Telecommunication services) . . . . . . . . . . . . . . . . . . 2,650,134
481,000 Hutchison Whampoa, Ltd. (Container terminal and real
estate company) . . . . . . . . . . . . . . . . . . . . . . . . . 1,964,585
786,000 Hysan Development Co. (Real estate developer) . . . . . . . . . . . 1,559,443
129,400 Jardine Matheson Holdings, Ltd. (Conglomerate: real estate,
merchandising, engineering) . . . . . . . . . . . . . . . . . . . 924,071
670,000 Jinhui Holdings Ltd. (Operator of dry bulk cargo ships
in southern China) . . . . . . . . . . . . . . . . . . . . . . . 921,250
722,000 Peregrine Investment Holdings Ltd. (Leading
financial services group) . . . . . . . . . . . . . . . . . . . 849,214
183,000 Swire Pacific Ltd. "A" (General trading and real
estate company) . . . . . . . . . . . . . . . . . . . . . . . . . 1,142,449
628,000 Television Broadcasts, Ltd. (Television broadcasting) . . . . . . . 2,540,637
3,998,300 Yips Hang Cheung (Manufacturer of mixed solvents and paints) . . . . 1,162,777
-----------
24,726,070
-----------
INDIA 2.0% 78,500 Bajaj Auto (GDR) (Maker of two and three wheel vehicles) . . . . . . 1,903,625
75,000 Ranbaxy Laboratories (Pharmaceutical company) . . . . . . . . . . . 1,687,500
-----------
3,591,125
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
<TABLE>
Scudder New Asia Fund, Inc.
Investment Portfolio (continued)
- - ----------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Market
Shares Value ($)
- - ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
INDONESIA 6.0% 954,000 Gadjah Tunggal (Tire manufacturer) . . . . . . . . . . . . . . . . 1,308,044
615,500 Jaya Real Properties (Foreign registered) (Property developer) . . . 1,969,150
814,000 Kabelmetal Indonesia (Cable manufacturer) . . . . . . . . . . . . . 1,116,087
562,000 Kalbe Farma (Pharmaceutical producer and distributor). . . . . . . . 2,324,543
713,000 Modern Photo Film Co. (Photographic film distributor). . . . . . . . 3,030,576
424 Supreme Cable Co.(b) (Foreign registered) (Manufacturer
of power and telecommunication cables) . . . . . . . . . . . . . 1,260
67,271 Unilever-Indonesia (b) (Foreign registered) (Consumer
products manufacturer) . . . . . . . . . . . . . . . . . . . . . 1,076,090
----------
10,825,750
----------
JAPAN 23.9% 162,000 Canon Inc. (Leading producer of visual image and
information equipment) . . . . . . . . . . . . . . . . . . . . . 2,747,259
256 DDI Corp. (Long distance telephone and cellular operator) . . . . . 2,209,111
35,000 Eyeful Home Technology Inc. (Homebuilding franchise operator) . . . 1,071,142
58,000 Hasegawa Co., Ltd. (Leading retailer of Buddhist altars
and accessories). . . . . . . . . . . . . . . . . . . . . . . . . 1,012,643
67,000 Hitachi Construction Machinery Co., Ltd. (Leading
maker of hydraulic shovels) . . . . . . . . . . . . . . . . . . . 880,694
158,000 Hitachi Metals, Ltd. (Major producer of high-quality
specialty steels) . . . . . . . . . . . . . . . . . . . . . . . . 1,934,176
54,000 JAMCO Corp. (Leading manufacturer of galleys and
lavatories for commercial aircraft) . . . . . . . . . . . . . . . 574,353
16,000 Japan Associated Finance Co. (Venture capital company) . . . . . . 2,488,461
4,000 Kato Denki Co., Ltd. (Operator of household
electric appliance stores). . . . . . . . . . . . . . . . . . . . 108,368
15,700 Keyence Corp. (Specialized manufacturer of sensors) . . . . . . . . 1,780,153
34,000 Kyocera Corp. (Leading ceramic packaging manufacturer). . . . . . . 2,521,172
19,000 Mabuchi Motor Co., Ltd. (Manufacturer of DC motors) . . . . . . . . 1,429,862
84,000 NGK Spark Plug Co., Ltd. (Leading manufacturer of
automotive spark plugs) . . . . . . . . . . . . . . . . . . . . . 1,104,154
233,000 NSK Ltd. (Leading manufacturer of bearings and other
machinery parts) . . . . . . . . . . . . . . . . . . . . . . . . 1,846,980
34,326 Nichiei Co., Ltd. (Finance company for small and
medium-sized firms) . . . . . . . . . . . . . . . . . . . . . . . 2,204,359
30,960 Nissen Co., Ltd. (Mail-order women's apparel distributor) . . . . . 956,821
26,000 Nitori Co., Ltd. (Importer and retailer of furniture and
interior products) . . . . . . . . . . . . . . . . . . . . . . . 1,069,637
58,000 Oiles Corp. (Manufacturer of oil less bearings) . . . . . . . . . . 1,629,540
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
<TABLE>
- - ------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Market
Shares Value ($)
- - ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
17,000 PCA Corp. (Developer of financial accounting software
for small and medium-sized firms) . . . . . . . . . . . . . 1,040,538
41,000 Rock Field Co., Ltd. (Major delicatessen food processor) . . . 806,342
24,000 Royal Ltd. (Wholesaler and retailer of automobile
equipment and parts) . . . . . . . . . . . . . . . . . . . 939,193
35,900 SMC Corp. (Leading maker of pneumatic equipment) . . . . . . . 2,042,474
172,000 ShinMaywa Industries, Ltd. (Leading maker of dump
trucks and other specialty vehicles) . . . . . . . . . . . 1,760,385
9,000 Shohkoh Fund & Co., Ltd. (Finance company for small
and medium-sized firms) . . . . . . . . . . . . . . . . . . 1,860,325
4,000 Softbank Corp. (Wholesaler of personal computer
software and publisher of related materials) . . . . . . . 883,002
60,000 Sumitomo Electric Industries, Ltd. (Leading manufacturer
of electric wires and cables) . . . . . . . . . . . . . . . 854,907
601,000 Sumitomo Metal Industries, Ltd. (Leading integrated
crude steel producer) . . . . . . . . . . . . . . . . . . . 1,947,853
58,100 THK Co., Ltd. (Manufacturer of linear motion
systems for industrial machinery) . . . . . . . . . . . . . 1,469,115
24,000 Takuma Co., Ltd. (Leading maker of boilers, garbage
incinerators and water treatment plants) . . . . . . . . . 433,474
52,000 Ten Allied Co., Ltd. (Tavern chain operator) . . . . . . . . . 1,460,967
----------
43,067,460
----------
KOREA 7.9% 133,279 Daewoo Heavy Industries Ltd. (Leading
manufacturer of heavy industrial equipment). . . . . . . . 2,076,155
2,420 Daewoo Heavy Industries Ltd. (New**) . . . . . . . . . . . . . 38,004
50,000 Daewoo Telecom Co. (Manufacturer of personal
computers and communications equipment). . . . . . . . . . 835,866
7,999 Daewoo Telecom Co. (New**) . . . . . . . . . . . . . . . . . 129,670
42,757 Goldstar Co. (GDR) (Leading maker of consumer
electronics and electric appliances) . . . . . . . . . . . 652,044
19,675 Kia Motor Corp. (GDS) (Automotive products manufacturer) . . . 359,069
7,507 Korea Mobile Telecom (c) (Mobile telecommunication company). . 5,350,734
11,382 Samsung Electronics Co., Ltd.*(c) (Major electronics
manufacturer) . . . . . . . . . . . . . . . . . . . . . . . 1,681,209
471 Samsung Electronics Co., Ltd. (c) (New**) . . . . . . . . . . 68,613
10,705 Samsung Electronics Co., Ltd. (Sponsored GDR) . . . . . . . . 642,300
40,077 Samsung Electronics Co., Ltd. ( GDS) (New**) . . . . . . . . 1,803,465
928 Samsung Electronics Co., Ltd. (GDR) (New**) . . . . . . . . . 56,956
4,300 Yukong, Ltd. (Korea's largest oil refiner) . . . . . . . . . . 199,316
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
Scudder New Asia Fund, Inc.
Investment Portfolio (continued)
<TABLE>
<CAPTION>
Market
Shares Value ($)
- - -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
258 Yukong, Ltd. (New**) . . . . . . . . . . . . . . . . . . . . . . . 11,763
24,000 Yukong, Ltd. (GDR) . . . . . . . . . . . . . . . . . . . . . . . 360,000
------------
14,265,164
------------
MALAYSIA 8.7% 245,000 Aokam Perdana Berhad.* (Forest products company) . . . . . . . . . 1,514,772
430,000 Arab-Malaysian Corp. (Investment holding company
with interests in financial services,
infrastructure and property) . . . . . . . . . . . . . . . . . . 1,203,091
249,500 Genting Berhad. (Operator of tourist resorts,
hotels and restaurants) . . . . . . . . . . . . . . . . . . . . . 2,138,153
95,000 Kim Hin Industries (Ceramic tile manufacturer) . . . . . . . . . . 475,836
402,000 Malayan Banking Berhad.(Leading banking
and financial services group) . . . . . . . . . . . . . . . . . . 2,422,540
1,300,000 Technology Resources Industries* (Mobile telephone operator) . . . 4,145,960
257,000 United Engineers (Leading comprehensive contractor) . . . . . . . 1,267,149
140,000 Westmont Berhad. (Investment holding company) . . . . . . . . . . 871,062
253,000 YTL Corp. (General construction company) . . . . . . . . . . . . . 1,623,635
------------
15,662,198
------------
PAKISTAN 0.6% 172,776 Adamjee Insurance (Insurance company) . . . . . . . . . . . . . . . 1,042,139
------------
PHILIPPINES 4.3% 1,420,000 Ayala Corp. "B" (Industrial conglomerate) . . . . . . . . . . . . . 2,327,869
191,900 Benpres Holding Corp. (GDR) . . . . . . . . . . . . . . . . . . . . 1,775,075
106,000 Manila Electric Co. "B" (Electric utility) . . . . . . . . . . . . 1,455,328
413,000 San Miguel Corp. "B" (Brewery) . . . . . . . . . . . . . . . . . . 2,166,557
------------
7,724,829
------------
SINGAPORE 2.5% 139,000 Development Bank of Singapore (Foreign Registered)*
(Banking and financial services) . . . . . . . . . . . . . . . . 1,430,237
192,000 Overseas Union Bank Ltd. (Bank) . . . . . . . . . . . . . . . . . . 1,119,495
264,000 Sembawang Corp. (Ship repair and maritime services group) . . . . . 1,973,933
------------
4,523,665
------------
TAIWAN 1.4% 14,463 President Enterprises Corp. (GDR)* (Food and beverage
conglomerate) . . . . . . . . . . . . . . . . . . . . . . . . . . 282,029
26 Taipei Fund (IDR) (Investment company) . . . . . . . . . . . . . . 2,314,000
------------
2,596,029
------------
THAILAND 6.5% 47,000 Ban Pu Coal Public Co., Ltd. (Foreign registered)
(Leading miner of sub-bituminous coal in southeast Asia) . . . . 1,035,242
265,000 Bangkok Steel Industry Co., Ltd. (Manufacturer of metal
products, machinery and equipment) . . . . . . . . . . . . . . . 567,781
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
<TABLE>
- - ------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Market
Shares Value ($)
- - ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
240,000 PTT Exploration and Production Co., Ltd. (Foreign
registered)* (Petroleum refinery) . . . . . . . . . . . . . 2,498,999
434,000 Padaeng Industry Co., Ltd. (Foreign registered) (Mining and
refining of zinc ore) . . . . . . . . . . . . . . . . . . . 751,722
28,000 Siam Cement Co., Ltd. (Construction materials and
industrial conglomerate) . . . . . . . . . . . . . . . . . 1,686,504
98,750 TPI Polene Co., Ltd. (Producer and distributor of low density
polyethylene plastic pellets) . . . . . . . . . . . . . . . 885,865
512,560 Thai Farmers Bank (Foreign registered) (Commercial bank) . . . 4,187,515
-----------
11,613,628
-----------
UNITED STATES 3.3% 198,000 Freeport McMoRan Copper & Gold, Inc. "A"
(U.S. company mining in Indonesia) . . . . . . . . . . . . 4,207,500
127,500 Pacific Basin Bulk Shipping Ltd. Units (Shipping
company specializing in the handysize dry bulk carrier
segment in the Pacific region) . . . . . . . . . . . . . . 1,689,375
-----------
5,896,875
-----------
TOTAL COMMON STOCKS (Cost $120,730,127) . . . . . . . . . . . 148,216,915
-----------
- - ------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT PORTFOLIO -- 100.0% (Cost $153,091,567)(a). . 180,176,479
===========
<FN>
(a) The cost for federal income tax purposes was $154,221,576. At December 31, 1994, net unrealized appreciation for all
securities based on tax cost was $25,954,903. This consisted of aggregate gross unrealized appreciation for all
securities in which there was an excess of market value over tax cost of $35,401,568 and aggregate gross unrealized
depreciation for all securities in which there was an excess of tax cost over market value of $9,446,665.
(b) Securities valued in good faith by the valuation committee of the Board of Directors. The cost for these securities
at December 31, 1994 aggregated $1,743,250. See Note A of the Notes to Financial Statements.
(c) Securities that have met the foreign-ownership limitation valued at a premium in good faith by the Valuation
Committee of the Board of Directors. The cost of these securities at December 31, 1994 was $1,801,668. See Note A
of the Notes to Financial Statements.
* Non-income producing security.
** New shares issued during 1994, eligible for a pro rata share of 1994 dividends.
See page 9 for sector breakdown of the Fund's equity securities.
</TABLE>
<TABLE>
<CAPTION>
At December 31, 1994, the outstanding written option was as follows (Note A):
<CAPTION>
Call Option Principal Amount (JPY) (000's) Expiration Date Strike Price Market Value ($)
------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Japanese Yen (Premium
received $958,000) . . . . . 1,970,000 6/22/95 JPY 98.5 673,740
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
Scudder New Asia Fund, Inc.
Financial Statements
<TABLE>
- - ------------------------------------------------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1994
- - ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Investments, at market (identified cost $153,091,567) (Note A). . . . . . . . . . . . $ 180,176,479
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 772
Foreign currency holdings, at market (identified cost $36,415) (Note A) . . . . . . . 37,997
Forward foreign currency exchange contracts to buy, at market (contract cost
$929,273) (Notes A and E) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 929,366
Receivable on forward foreign currency exchange contracts to sell (Notes A and E). . 2,922,046
Other receivables:
Investments sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,787,827
Dividends and interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 353,845
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,307
-------------
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 188,209,639
LIABILITIES
Payables:
Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 35,545,296
Investments purchased . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 929,365
Payable for forward foreign currency exchange contracts to buy (Notes A and E) . . 929,273
Payable for foreign currency exchange contracts to sell, at market
(contract cost $2,922,046) (Notes A and E) . . . . . . . . . . . . . . . . . . 2,938,783
Accrued management fee (Note C) . . . . . . . . . . . . . . . . . . . . . . . . . 178,543
Other accrued expenses (Note C) . . . . . . . . . . . . . . . . . . . . . . . . . 143,153
Written option, at value (premium received $958,000) (Note A) . . . . . . . . . . 673,740
-------------
Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41,338,153
-------------
Net assets, at market value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 146,871,486
=============
NET ASSETS
Net assets consist of:
Accumulated distributions in excess of net investment income . . . . . . . . . . . $ (497,182)
Accumulated net realized gain on investment transactions . . . . . . . . . . . . . 6,748,934
Net unrealized appreciation (depreciation) on:
Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,084,912
Options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 284,260
Foreign currency related transactions . . . . . . . . . . . . . . . . . . . . . (10,748)
Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84,231
Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113,177,079
-------------
Net assets, at market value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 146,871,486
=============
NET ASSET VALUE per share ($146,871,486 -:- 8,423,056 shares of common stock
issued and outstanding, $.01 par value, 50,000,000 shares authorized) . . . . . . $17.44
======
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
Statement of Operations
Year Ended December 31, 1994
<TABLE>
<CAPTION>
- - --------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
<S> <C> <C>
Income:
Dividends (including taxes withheld of $171,990) . . . . . . . . . . . $ 1,998,481
Interest (including taxes withheld of $16,204) . . . . . . . . . . . . 1,570,663
-------------
3,569,144
Expenses:
Management fee (Note C) . . . . . . . . . . . . . . . . . . . . . . . . $ 2,264,745
Directors' fees and expenses (Note C) . . . . . . . . . . . . . . . . . 120,266
Custodian fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . 459,619
Reports to shareholders . . . . . . . . . . . . . . . . . . . . . . . . 112,821
Auditing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76,573
Legal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,480
Services to shareholders . . . . . . . . . . . . . . . . . . . . . . . 55,034
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62,610 3,175,148
------------ -------------
Net investment income . . . . . . . . . . . . . . . . . . . . . . . . . . 393,996
-------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENT TRANSACTIONS
Net realized gain (loss) from:
Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47,565,790
Foreign currency related transactions . . . . . . . . . . . . . . . . . (172,988) 47,392,802
-----------
Net unrealized appreciation (depreciation) during the period on:
Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (73,061,273)
Options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 284,260
Foreign currency related transactions . . . . . . . . . . . . . . . . . (8,284) (72,785,297)
------------ -------------
Net loss on investment transactions . . . . . . . . . . . . . . . . . . . (25,392,495)
-------------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS . . . . . . . . . . . . $ (24,998,499)
=============
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
Scudder New Asia Fund, Inc.
Financial Statements (continued)
<TABLE>
- - ------------------------------------------------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- - ------------------------------------------------------------------------------------------------------------------------
- - ------------------------------------------------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
---------------------------------
INCREASE (DECREASE) IN NET ASSETS 1994 1993
- - ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Operations:
Net investment income . . . . . . . . . . . . . . . . . . . . . . . . . $ 393,996 $ 723,845
Net realized gain (loss) from investment transactions . . . . . . . . . 47,392,802 (2,333,794)
Net unrealized appreciation (depreciation) on investment
transactions during the period . . . . . . . . . . . . . . . . . . . (72,785,297) 77,784,636
------------- -------------
Net increase (decrease) in net assets resulting from operations . . . . . . (24,998,499) 76,174,687
------------- -------------
Distributions to shareholders:
From net investment income ($.15 per share for December 31, 1993) . . . -- (1,099,616)
------------- -------------
In excess of net investment income ($.23 and $.17 per share,
respectively) . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,935,479) (1,193,799)
------------- -------------
From net realized gain from investment transactions ($4.20 per share). . (35,376,835) --
------------- -------------
In excess of net realized gain from investment transactions
($.08 per share for December 31, 1993) . . . . . . . . . . . . . . . -- (546,791)
------------- -------------
Fund share transactions:
Net proceeds of shares issued in connection with the Fund's rights
offering, net of offering costs of $421,048 . . . . . . . . . . . . 30,817,588 --
Reinvestment of distributions . . . . . . . . . . . . . . . . . . . . . 387,356 395,456
------------- -------------
Net increase in net assets from Fund share transactions . . . . . . . . 31,204,944 395,456
------------- -------------
INCREASE (DECREASE) IN NET ASSETS . . . . . . . . . . . . . . . . . . . . . (31,105,869) 73,729,937
Net assets at beginning of period . . . . . . . . . . . . . . . . . . . . . 177,977,355 104,247,418
------------- -------------
NET ASSETS AT END OF PERIOD (including accumulated distributions in excess
of net investment income of $497,182 and $1,619,849, respectively) $ 146,871,486 $ 177,977,355
============= =============
OTHER INFORMATION
INCREASE IN FUND SHARES
Shares outstanding at beginning of period . . . . . . . . . . . . . . . . . 7,102,417 7,076,615
Shares issued in connection with Fund's rights offering . . . . . . . . 1,304,872 --
Shares issued to shareholders in reinvestment of distributions . . . . . 15,767 25,802
------------- -------------
Shares outstanding at end of period . . . . . . . . . . . . . . . . . . . . 8,423,056 7,102,417
============= =============
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
Scudder New Asia Fund, Inc.
Financial Highlights
<TABLE>
<CAPTION>
- - ----------------------------------------------------------------------------------------------------------------------------
THE FOLLOWING TABLE INCLUDES SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD (A) AND OTHER PERFORMANCE
INFORMATION DERIVED FROM THE FINANCIAL STATEMENTS AND MARKET PRICE DATA.
- - ----------------------------------------------------------------------------------------------------------------------------
YEARS ENDED DECEMBER 31,
--------------------------------------------------------
PER SHARE OPERATING PERFORMANCE 1994 1993 1992 1991 1990
- - ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period . . . . . . . . . . $25.06 $14.73 $14.94 $13.44 $16.36
------ ------ ------ ------ ------
Income from investment operations:
Net investment income (loss) . . . . . . . . . . . . . .05 .10 .08 .08 .08
Net realized and unrealized gain
(loss) on investments (b) . . . . . . . . . . . . . . . (3.21) 10.63 .22 1.61 (.81)
------ ------ ------ ------ ------
Total from investment operations . . . . . . . . . . . . (3.16) 10.73 .30 1.69 (.73)
------ ------ ------ ------ ------
Dilution resulting from rights offering . . . . . . . . . (.03) -- -- -- --
------ ------ ------ ------ ------
Less distributions:
From net investment income . . . . . . . . . . . . . . -- (.15) (.08) (.08) (.08)
In excess of net investment income . . . . . . . . . . (.23) (.17) -- -- --
From net realized gains on investments . . . . . . . . (4.20) -- (.43) (.11) (2.11)
In excess of net realized gains on investments . . . . -- (.08) -- -- --
------ ------ ------ ------ ------
Total distributions . . . . . . . . . . . . . . . . . . . (4.43) (.40) (.51) (.19) (2.19)
------ ------ ------ ------ ------
Net asset value, end of period . . . . . . . . . . . . . $17.44 $25.06 $14.73 $14.94 $13.44
====== ====== ====== ====== ======
Market value, end of period . . . . . . . . . . . . . . . $16.16(d) $27.38 $14.25 $15.13 $12.00
====== ====== ====== ====== ======
TOTAL RETURN
Per share market value (%) . . . . . . . . . . . . . . (25.10) 95.71 (2.59) 27.60 (10.53)
Per share net asset value (%)(c) . . . . . . . . . . . (11.67) 73.32 1.94 12.54 (2.77)
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period ($ millions) . . . . . . . . 147 178 104 106 94
Ratio of interest expense to average net
assets (%) . . . . . . . . . . . . . . . . . . . . . . -- -- -- -- .02
Ratio of operating expenses (excluding
interest) to average net assets (%) . . . . . . . . . . 1.67 1.71 1.76 1.79 1.77
Ratio of net investment income (loss) to
average net assets (%) . . . . . . . . . . . . . . . . .21 .56 .50 .54 .46
Portfolio turnover rate (%) . . . . . . . . . . . . . . 81.6 10.3 13.7 12.3 24.1
<FN>
(a) Based on monthly average shares outstanding during the period.
(b) Net of provision for federal income tax of $.02 per share for the year ended December 31, 1991.
(c) Total return based on per share net asset value reflects the effects of changes in net asset value on the performance
of the Fund during each period, and assumes dividends and capital gains distributions, if any, were reinvested. These
percentages are not an indication of the performance of a shareholder's investment in the Fund based on market value
due to differences between the price of the stock and the net asset value of the Fund during each period.
(d) Market value of $20.38 has been reduced to reflect a distribution of $4.22 per share payable on January 17, 1995,
relating to a due bill which entitles individuals who purchase shares prior to January 18, 1995, the ex date of the
dividend, to be reimbursed by the seller in the amount of the distribution.
</TABLE>
<PAGE>
Scudder New Asia Fund, Inc.
Notes to Financial Statements
- - --------------------------------------------------------------------------------
A. SIGNIFICANT ACCOUNTING POLICIES
-------------------------------
Scudder New Asia Fund, Inc. (the "Fund") is registered under the Investment
Company Act of 1940, as amended, as a diversified, closed-end management
investment company. The policies described below are followed consistently by
the Fund in the preparation of its financial statements in conformity with
generally accepted accounting principles.
SECURITY VALUATION. Portfolio securities which are traded on U.S. or foreign
stock exchanges are valued at the most recent sale price reported on the
exchange on which the security is traded most extensively. If no sale occurred,
the security is then valued at the mean between the most recent bid and asked
quotations. If there are no such bid and asked quotations, the most recent bid
quotation is used. Securities quoted on the National Association of Securities
Dealers Automatic Quotation ("NASDAQ") System, for which there have been sales,
are valued at the most recent sale price reported on such system. If there are
no such sales, the value is the high or "inside" bid quotation. Securities
which are not quoted on the NASDAQ System but are traded in another
over-the-counter market are valued at the most recent sale price on such
market. If no sale occurred, the security is then valued at the calculated mean
between the most recent bid and asked quotations. If there are no such bid and
asked quotations, the most recent bid quotation shall be used.
Portfolio debt securities with remaining maturities greater than sixty days are
valued by pricing agents approved by the Officers of the Fund, which prices
reflect broker/dealer-supplied valuations and electronic data processing
techniques. If the pricing agents are unable to provide such quotations, the
most recent bid quotation supplied by a bona fide market maker shall be used.
Short-term investments having a maturity of sixty days or less are valued at
amortized cost.
All other securities are valued at fair value as determined in good faith by
the Valuation Committee of the Board of Directors, although the actual
calculation may be done by others, including certain investments in securities
that have met the limit for aggregate foreign ownership and for which premiums
to the local stock exchange prices are offered by prospective foreign
investors. The aggregate premium ($1,472,123) over the local share price
($5,628,433) for these securities valued by the Valuation Committee was
approximately 1.0% of the Fund's net assets at December 31, 1994. All other
securities valued in good faith by the Valuation Committee amounted to
$2,051,880 or 1.4% of the Fund's net assets at December 31, 1994.
OPTIONS. The Fund may write (sell) exchange-listed and over-the-counter call
and put options on securities, securities indices, currencies and other
financial instruments. During the period, to hedge a portion of the Fund's
Japanese yen exposure, the Fund wrote call options on Japanese yen.
When the Fund writes a call, it gives the purchaser of the call option the
right to buy the underlying security or currency at the price specified in the
option (the "exercise price") at any time during the option period, generally
ranging up to nine months. When the Fund writes a put option, it gives the
purchaser of the put option the right to sell the underlying security or
currency to the Fund at the exercise price at any time during the option
period, generally ranging up to nine months.
If the option expires unexercised, the Fund will realize income, in the form of
a capital gain, to the extent of the amount received for the option (the
"premium"). If the option is exercised, a decision
<PAGE>
- - --------------------------------------------------------------------------------
over which the Fund has no control, the Fund must sell the underlying security
or currency to the option holder or purchase the underlying security or
currency from the option holder at the exercise price. Certain options,
including options on indices, will require cash settlement by the Fund if the
option is exercised. By writing a call option, the Fund foregoes, in exchange
for the premium less the commission ("net premium"), the opportunity to profit
during the option period from an increase in the market value of the underlying
security or currency above the exercise price. By writing a put option, the
Fund, in exchange for the net premium received, accepts the risk of a decline
in the market value of the underlying security or currency below the exercise
price.
The liability representing the Fund's obligation under an exchange traded
written call or put option is valued at the last sale price or, in the absence
of a sale, the mean between the closing bid and asked quotations or at the most
recent asked quotation if no bid and asked quotations are available.
Over-the-counter written options are valued at the most recent asked quotation.
In addition, the Fund may purchase, singly and in combination, call and put
options on securities, securities indices, currencies and other financial
instruments. Exchange traded purchased options are valued at the last sales
price or, in the absence of a sale, the mean between the closing bid and asked
quotations or at the most recent bid quotation if no bid and asked quotations
are available. Over-the-counter purchased options are valued at the most recent
bid quotation.
REPURCHASE AGREEMENTS. The Fund may enter into repurchase agreements with
certain banks and domestic or foreign broker/dealers whereby the Fund, through
its custodian, receives delivery of the underlying securities, the amount of
which at the time of purchase and each subsequent business day is required to
be maintained at such a level that the market value, depending on the maturity
of the repurchase agreement and the underlying collateral, is equal to at least
100.5% of the resale price.
FOREIGN CURRENCY TRANSLATIONS. The books and records of the Fund are maintained
in U.S. dollars. Foreign currency transactions are translated into U.S. dollars
on the following basis:
(i) market value of investment securities, other assets and liabilities
at the daily rates of exchange, and
(ii) purchases and sales of investment securities, dividend and interest
income and certain expenses at the rates of exchange prevailing on
the respective dates of such transactions.
The Fund does not isolate that portion of gains and losses on investments which
is due to changes in foreign exchange rates from that which is due to changes
in market prices of the investments. Such fluctuations are included with the
net realized and unrealized gains and losses from investments.
Net realized and unrealized gain (loss) from foreign currency related
transactions includes gains and losses between trade and settlement dates on
securities transactions, gains and losses arising from the sales of foreign
currency, and gains and losses between the ex and payment dates on dividends,
interest, and foreign withholding taxes.
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS. In connection with portfolio
purchases and sales of securities denominated in a foreign currency, the Fund
may enter into forward foreign currency exchange contracts ("contracts").
Additionally, the Fund may enter into contracts to hedge certain other foreign
currency denominated assets. Contracts are recorded at market value. Certain
risks may arise upon entering into these contracts from the potential
<PAGE>
Scudder New Asia Fund, Inc.
Notes to Financial Statements (continued)
- - --------------------------------------------------------------------------------
inability of counterparties to meet the terms of their contracts. Realized and
unrealized gains and losses arising from such transactions are included in net
realized and unrealized gain (loss) from foreign currency related transactions.
FEDERAL INCOME TAXES. The Fund's policy is to comply with the requirements of
the Internal Revenue Code which are applicable to regulated investment
companies, and to distribute all of its taxable income to its shareholders. The
Fund accordingly paid no U.S. federal income taxes, and no federal income tax
provision was required.
DISTRIBUTION OF INCOME AND GAINS. Distributions of net investment income are
made annually. Distributions of net realized gains from investment transactions
in excess of available capital loss carryforwards, which would be taxable to
the Fund if not distributed, will be distributed to shareholders annually. An
additional distribution may be made to the extent necessary to avoid the
payment of a four percent federal excise tax.
The timing and characterization of certain income and capital gains
distributions are determined annually in accordance with federal tax
regulations which may differ from generally accepted accounting principles.
These differences relate primarily to investments in Passive Foreign Investment
Companies, foreign denominated investments, forward contracts and certain
securities sold at a loss. As a result, net investment income and net realized
gain (loss) on investment transactions for a reporting period may differ
significantly from distributions during such period. Accordingly, the Fund may
periodically make reclassifications among certain of its capital accounts
without impacting the net asset value of the Fund.
The Fund uses the identified cost method for determining realized gain or loss
on investments for both financial and federal income tax reporting purposes.
OTHER. Investment security transactions are accounted for on a trade-date
basis. Dividend income is recorded on the ex-dividend date. Interest income is
recorded on the accrual basis. Distributions to shareholders are recorded on
the ex-dividend date except in situations where, under New York Stock Exchange
rules, the ex-dividend date is deferred until after the payment date. Deferred
ex-date distributions are recorded four business days prior to the record date.
B. PURCHASES AND SALES OF SECURITIES
---------------------------------
For the year ended December 31, 1994, purchases and sales of investment
securities (excluding short-term investments) aggregated $133,244,918 and
$127,227,703, respectively.
C. RELATED PARTIES
---------------
Under the Investment Advisory and Management Agreement (the "Management
Agreement") with Scudder, Stevens & Clark, Inc. (the "Manager") the Fund has
agreed to pay the Manager a fee equal to an annual rate of 1.25% of the first
$75,000,000 of average weekly net assets of the Fund, 1.15% of the next
$125,000,000 and 1.10% of the excess over $200,000,000, payable monthly. As
manager of the assets of the Fund, the Manager directs the investments of the
Fund in accordance with its investment objectives, policies, and restrictions.
The Manager determines the securities, instruments, and other contracts
relating to investments to be purchased, sold or entered into by the Fund. In
addition to portfolio management services, the Manager shall provide certain
administrative services in accordance with the Management Agreement. For the
year ended December 31, 1994, the fee pursuant to the agreement amounted to
$2,264,745, which is equivalent to an annual effective rate of 1.19% of the
Fund's average weekly net assets.
<PAGE>
- - --------------------------------------------------------------------------------
The Fund pays each Director not affiliated with the Manager, $6,000 annually,
plus specified amounts for attended board and committee meetings. For the year
ended December 31, 1994, Directors' fees and expenses aggregated $120,266.
D. FOREIGN INVESTMENT REGULATIONS
------------------------------
JAPAN. Under the Foreign Exchange and Foreign Trade Control Law, foreigners are
subject to certain restrictions with respect to investing in securities of
Japanese companies. In general, non-residents may purchase 10% or more of the
stock of any "listed company" after giving prior notice to the Finance Minister
or through securities houses designated by the Finance Minister. "Listed
companies" are those that are listed on a Japanese stock exchange or have been
registered with the Securities Dealers Association of Japan. Any investor,
either resident or non-resident, acquiring or owning, by itself or together
with its "affiliates", more than 5% of the stock of any "listed company", must
file a notice thereof with the Finance Minister within five business days.
Subsequent filings may have to be made if the ownership rate changes.
KOREA. Under current regulations of the Minister of Finance of Korea and the
Securities and Exchange Commission of Korea ("KSEC"), foreigners are subject to
certain restrictions with respect to investing in equity securities of Korean
companies listed on the Korean Stock Exchange. In general, total foreign
investment is limited to 12% of each class of a company's outstanding shares,
while a single foreign investor may only invest up to 3% of each class of
outstanding shares.
INDIA. The Securities and Exchange Board of India provides certain guidelines
for direct foreign investment by foreign institutional investors. Total foreign
investment is limited to 24% of each class of a company's outstanding shares,
while a single foreign investor may only invest up to 5% of each class of
outstanding shares.
OTHER ASIAN COUNTRIES. Prior governmental approval for investments by foreign
investors is required under certain circumstances in Malaysia and the
Philippines, and the extent of foreign investment in domestic companies is
subject to limitation in the Philippines, Thailand and Indonesia. Limitations
upon foreign ownership also may be imposed by the charters of individual
companies in Singapore, Malaysia, Thailand and Indonesia, and many companies in
the Philippines restrict stock purchases by foreign investors to a separate
class of stock to prevent violation of foreign investment limitations. There
currently are no restrictions in Japan, Hong Kong or Singapore upon the
repatriation of investment income, capital or the proceeds of securities sales
by foreign investors. Repatriation of investment income, capital and the
proceeds of securities sales by foreign investors requires governmental
registration and/or approval in Malaysia, Korea, India, the Philippines,
Thailand and Indonesia. The Fund could be adversely affected by delays in, or a
refusal to grant, any required governmental approval for such repatriation.
<PAGE>
Scudder New Asia Fund, Inc.
Notes to Financial Statements (continued)
- - --------------------------------------------------------------------------------
E. COMMITMENTS
-----------
As of December 31, 1994, the Fund had entered into the following forward
foreign currency exchange contracts resulting in net unrealized depreciation of
$16,644.
<TABLE>
<CAPTION>
NET UNREALIZED
APPRECIATION
SETTLEMENT (DEPRECIATION)
CONTRACTS TO DELIVER IN EXCHANGE FOR DATE (U.S.$)
- - ---------------------- -------------------- ------------------ ---------------
<S> <C> <C> <C> <C> <C>
USD 912,024 HKD 7,056,878 1/3/95 94
USD 17,249 HKD 133,433 1/4/95 (1)
THB 55,813,733 USD 2,220,558 1/3/95 (14,673)
JPY 57,550,992 USD 575,650 1/4/95 to 1/6/95 (1,823)
IDR 65,753,205 USD 29,867 1/5/95 (185)
MYR 245,396 USD 95,970 1/9/95 (56)
------
(16,644)
======
</TABLE>
F. QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) (000 OMITTED)
<TABLE>
<CAPTION>
NET GAIN (LOSS) NET INCREASE
ON INVESTMENT AND (DECREASE)
FOREIGN CURRENCY IN NET ASSETS
QUARTER INVESTMENT NET INVESTMENT RELATED RESULTING
ENDED INCOME* INCOME (LOSS) TRANSACTIONS FROM OPERATIONS
- - --------------------- --------------------- ------------------- -------------------- --------------------
PER PER PER PER
1994 TOTAL SHARE TOTAL SHARE TOTAL SHARE TOTAL SHARE
---- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
March 31, $ 634 $ .08 $ (109) $ (.01) $(22,870) $(2.95) $(22,979) $(2.96)
June 30, 1,158 .17 356 .04 4,241 .54 4,597 .58
September 30, 959 .09 158 .02 13,694 1.82 13,852 1.84
December 31, 818 .09 (11) -- (20,457) (2.62) (20,468) (2.62)
------ ----- ------ ------- -------- ------ -------- ------
Totals $3,569 $ .43 $ 394 $ .05 $(25,392) $(3.21) $(24,998) $(3.16)
====== ===== ====== ======= ======== ====== ======== ======
PER PER PER PER
1993 TOTAL SHARE TOTAL SHARE TOTAL SHARE TOTAL SHARE
---- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
March 31, $ 561 $ .08 $ 82 $ .01 $ 11,906 $ 1.68 $ 11,988 $ 1.69
June 30, 737 .10 193 .03 11,429 1.61 11,622 1.64
September 30, 728 .11 172 .02 14,082 1.98 14,254 2.00
December 31, 928 .13 277 .04 38,034 5.36 38,311 5.40
------ ----- ------ ------- -------- ------ -------- ------
Totals $2,954 $ .42 $ 724 $ .10 $ 75,451 $10.63 $ 76,175 $10.73
====== ===== ====== ======= ======== ====== ======== ======
<FN>
* Net of foreign taxes withheld
</TABLE>
<PAGE>
Scudder New Asia Fund, Inc.
Report of Independent Accountants
- - --------------------------------------------------------------------------------
TO THE BOARD OF DIRECTORS AND SHAREHOLDERS OF SCUDDER NEW ASIA FUND, INC.:
We have audited the accompanying statement of assets and liabilities of Scudder
New Asia Fund, Inc., including the investment portfolio, as of December 31,
1994, and the related statement of operations for the year then ended, the
statements of changes in net assets for the two years in the period then ended,
and the financial highlights for each of the five years in the period then
ended. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1994 by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Scudder New Asia Fund, Inc. as of December 31, 1994, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended, and the financial highlights for each
of the five years in the period then ended in conformity with generally
accepted accounting principles.
Boston, Massachusetts COOPERS & LYBRAND L.L.P.
February 10, 1995
<PAGE>
Scudder New Asia Fund, Inc.
Tax Information
- - --------------------------------------------------------------------------------
By now shareholders for whom year end tax reporting is required by the IRS
should have received their Form 1099-DIV and tax information letter from the
Fund.
The Fund paid distributions of $4.03 per share from net capital gains during
its year ended December 31, 1994. Pursuant to Section 852 of the Internal
Revenue Code, the Fund designates $40,703,434 as a long-term capital gain
dividend for the fiscal year ended December 31, 1994.
Due to the nature of its investments, the Fund pays a variety of foreign taxes
throughout the year. As in prior years, the Fund intends to make an election
under section 853 of the Internal Revenue Code. This election will allow
shareholders to treat their proportionate share of foreign taxes paid by the
Fund as having been paid directly by them. Additionally, shareholders will be
required to report their proportionate share of such taxes paid as gross income
(in addition to other amounts of reportable distributions paid by the Fund).
The total amount of income received by the Fund from sources within foreign
countries and possessions of the United States for its year ended December 31,
1994 was $.14 per share (representing a total of $1,164,178). The total amount
of taxes paid by the Fund to such countries was $.0222 per share (representing
a total of $186,924). The following table provides a breakdown by country of
ordinary income dividends and foreign taxes paid by the Fund in 1994:
<TABLE>
<CAPTION>
1994 Foreign Tax Credit Tables
------------------------------
Country Foreign Income Foreign Taxes
- - -------------- -------------- -------------
<S> <C> <C>
Hong Kong 14.73% - %
Indonesia 2.54 13.89
India 0.55 -
Japan 2.56 13.37
Korea 1.53 5.59
Malaysia 3.12 26.81
Pakistan 0.30 0.69
Philippines 0.46 3.99
Singapore 1.03 9.69
Taiwan 0.07 5.31
Thailand 5.99 20.66
United States 67.12 -
-------------- -------------
100.00% 100.00%
============== =============
</TABLE>
Please consult a tax adviser if you have questions about federal or state
income tax laws, or on how to prepare your tax returns. If you have specific
questions about your account, please call (800) 426-5523.
<PAGE>
Dividend Reinvestment and Cash Purchase Plan
The Plan
The Fund's Dividend Reinvestment and Cash Purchase Plan (the "Plan")
offers you an automatic way to reinvest your dividends and capital gains
distributions in shares of the Fund. The Plan also provides for cash
investments in Fund shares of $100 to $3,000 semiannually through State
Street Bank and Trust Company, the Plan Agent. Note that the Fund's share
price for purposes of the Plan is calculated net of due-bills, if
applicable. Please see discussion of due-bills on page 3.
Automatic Participation
Each shareholder of record is automatically a participant in the Plan
unless the shareholder has instructed the Plan Agent in writing otherwise.
Such a notice must be received by the Plan Agent not less than 10 days
prior to the record date for a dividend or distribution in order to be
effective with respect to that dividend or distribution. A notice which is
not received by that time will be effective only with respect to subsequent
dividends and distributions.
Shareholders who do not participate in the Plan will receive all
distributions in cash paid by check in dollars mailed directly to the
shareholder by State Street Bank and Trust Company, as dividend paying
agent.
Shares Held by a Nominee
If your shares are held in the name of a brokerage firm, bank, or
other nominee as the shareholder of record, please consult your nominee (or
any successor nominee) to determine whether it is participating in the Plan
on your behalf. Many nominees are generally authorized to receive cash
dividends unless they are specifically instructed by a client to reinvest.
If you would like your nominee to participate in the Plan on your behalf,
you should give your nominee instructions to that effect as soon as
possible.
Pricing of Dividends and Distributions
If the market price per share on the payment date for the dividend or
distribution (the "Valuation Date") equals or exceeds net asset value per
share on that date, the Fund will issue new shares to participants at the
greater of the following on the Valuation Date: (a) net asset value, or (b)
95% of the market price. The Valuation Date will be the dividend or
distribution payment date or, if that date is not a New York Stock Exchange
trading date, the next preceding trading date. If the net asset value
exceeds the market price of Fund shares at such time, participants in the
Plan are considered to have elected to receive shares of stock from the
Fund, valued at market price, on the Valuation Date. In either case, for
Federal income tax purposes, the shareholder receives a distribution equal
to the market value on Valuation Date of new shares issued. State and local
taxes may also apply. If the Fund should declare an income dividend or net
capital gains distribution payable only in cash, the Plan Agent will, as
agent for the participants, buy Fund shares in the open market, on the New
York Stock Exchange or elsewhere, for the participants' account on, or
shortly after, the payment date.
Voluntary Cash Purchases
Participants in the Plan have the option of making additional cash
payments to the Plan Agent, semiannually, in any amount from $100 to
$3,000, for investment in the Fund's shares. The Plan Agent will use all
such monies received from participants to purchase Fund shares in the open
market on or about February 15 and August 15. Any voluntary cash payments
received more than 30 days prior to these dates will be returned by the
Plan Agent, and interest will not be paid on any uninvested cash payments.
To avoid unnecessary cash accumulations, and also to allow ample time for
receipt and processing by the Plan Agent, it is suggested that participants
send in voluntary cash payments to be received by the Plan Agent
approximately ten days before February 15, or August 15, as the case may
be. A participant may withdraw a voluntary cash payment by written notice,
if the notice is received by the Plan Agent not less than 48 hours before
such payment is to be invested.
Participant Plan Accounts
The Plan Agent maintains all participant accounts in the Plan and
furnishes written confirmation of all transactions in the account,
including information needed by participants for personal and tax records.
Shares in the account of each plan participant will be held by the Plan
Agent in non-certificated form in the name of the participant, and each
participant will be able to vote those shares purchased pursuant to the
Plan at a shareholder meeting or by proxy.
No Service Fee to Reinvest
There is no service fee charged to participants for reinvesting
dividends or distributions from net realized capital gains. The Plan
Agent's fees for the handling of the reinvestment of dividends and capital
gains distributions will be paid by the Fund. There will be no brokerage
commissions with respect to shares issued directly by the Fund as a result
of dividends or capital gains distributions payable either in stock or in
cash. However, participants will pay a pro rata share of brokerage
commissions incurred with respect to the Plan Agent's open market purchases
in connection with the reinvestment of any dividends or capital gains
distributions payable only in cash.
Costs for Cash Purchases
With respect to purchases of Fund shares from voluntary cash payments,
the Plan Agent will charge $0.75 for each such purchase for a participant.
Each participant will pay a pro rata share of brokerage commissions
incurred with respect to the Plan Agent's open market purchases of Fund
shares in connection with voluntary cash payments made by the participant.
Brokerage charges for purchasing small amounts of stock for individual
accounts through the Plan are expected to be less than the usual brokerage
charges for such transactions, because the Plan Agent will be purchasing
stock for all participants in blocks and pro-rating the lower commission
thus attainable.
Amendment or Termination
The Fund and the Plan Agent each reserve the right to terminate the
Plan. Notice of the termination will be sent to the participants of the
Plan at least 30 days before the record date for a dividend or
distribution. The Plan also may be amended by the Fund or the Plan Agent,
but (except when necessary or appropriate to comply with applicable law,
rules or policies of a regulatory authority) only by giving at least 30
days' written notice to participants in the Plan.
A participant may terminate his account under the Plan by written
notice to the Plan Agent. If the written notice is received 10 days before
the record day of any distribution, it will be effective immediately. If
received after that date, it will be effective as soon as possible after
the reinvestment of the dividend or distribution.
If a participant elects to sell his shares before the Plan is
terminated, the Plan Agent will deduct a $2.50 fee plus brokerage
commissions from the sale transaction.
Plan Agent Address and Telephone Number
You may obtain more detailed information by requesting a copy of the
Plan from the Plan Agent. All correspondence (including notifications)
should be directed to: Scudder New Asia Fund Dividend Reinvestment and Cash
Purchase Plan, c/o State Street Bank and Trust Company, P.O. Box 8200,
Boston, MA 02266-8200, (617) 328-5000, ext. 6406.
Scudder New Asia Fund, Inc. Investment Manager
The investment manager of Scudder New Asia Fund, Inc. (the "Fund") is
Scudder, Stevens & Clark, Inc., one of the most experienced investment
management and investment counsel firms in the United States. Established
in 1919, the firm provides investment counsel for individuals, investment
companies and institutions. Scudder has offices throughout the United
States and subsidiaries in London and in Tokyo.
Scudder has been active in international investment management for
over 40 years. It manages Scudder International Fund, which was initially
incorporated in Canada in 1953 as the first foreign investment company
registered with the U.S. Securities and Exchange Commission. Scudder's
investment company clients include eight other open-end investment
companies which invest worldwide.
In addition to the Fund, Scudder also manages the assets of seven
other closed-end investment companies which invest in foreign securities.
The Argentina Fund, Inc. (investing primarily in equity securities of
Argentine issuers), The Brazil Fund, Inc. (investing primarily in equity
securities of Brazilian issuers), The Korea Fund, Inc. (investing in a
broad spectrum of Korean industries), The Latin America Dollar Income Fund,
Inc. (investing principally in Latin American debt instruments), Scudder
New Europe Fund, Inc. (investing in equity securities traded on smaller or
emerging European securities markets) and Scudder World Income
Opportunities Fund, Inc. (investing in global income and, to a limited
extent, equity securities) are traded on the New York Stock Exchange. The
First Iberian Fund, Inc. (investing primarily in Spanish and Portuguese
securities) is traded on the American Stock Exchange.
Directors and Officers
EDMOND D. VILLANI*
Chairman of the Board and Director
NICHOLAS BRATT*
President and Director
PAUL BANCROFT III
Director
ROBERT J. CALLANDER
Director
THOMAS J. DEVINE
Director
WILLIAM H. GLEYSTEEN, JR.
Director
JAMES W. MORLEY
Honorary Director
WILSON NOLEN
Director
JURIS PADEGS*
Vice President, Assistant Secretary and Director
HUGH T. PATRICK
Director
Daniel Pierce*
Director
ROBERT G. STONE, JR.
Honorary Director
ELIZABETH J. ALLAN*
Vice President
JERARD K. HARTMAN*
Vice President
SEUNG KWAK*
Vice President
DAVID S. LEE*
Vice President
THOMAS F. McDONOUGH*
Secretary and Assistant Treasurer
PAMELA A. McGRATH*
Vice President and Treasurer
EDWARD J. O'CONNELL*
Vice President and Assistant Treasurer
COLEEN DOWNS DINNEEN*
Assistant Secretary
*Scudder, Stevens & Clark, Inc.
