DELAWARE GROUP VALUE FUND INC, 497, 1996-12-03

DELAWARE GROUP VALUE FUND INC
497, 1996-12-03

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<PAGE> 1

NOVEMBER 29, 1996

VALUE FUND
A CLASS/B CLASS/C CLASS

SUPPLEMENT TO PROSPECTUS DATED JANUARY 29, 1996

NAME CHANGE

Effective as of November 29, 1996, the name of Delaware Group Value
Fund, Inc. was changed to Delaware Group Equity Funds V, Inc. Also effective
as of November 29, 1996, the name of Series I was changed to the Value Fund
series.

ADDITIONAL SERIES

Delaware Group Equity Funds V, Inc. consists of two series, the Value
Fund series (the "Fund") and the Retirement Income Fund series. For purposes
of the election of directors of Delaware Group Equity Funds V, Inc., holders of
more than 50% of the aggregate outstanding shares of the Fund and the
Retirement Income Fund series can elect 100% of the directors if they so
choose. Shareholders of more than 10% of the aggregate outstanding shares of
the Fund and the Retirement Income Fund series may request that a special
meeting be called to consider the removal of a director.

FINANCIAL HIGHLIGHTS

The following unaudited financial highlights for the Value Fund A
Class, Value Fund B Class and Value Fund C Class are derived from the unaudited
financial statements of Delaware Group Equity Funds V, Inc. for the six-month
period ended May 31, 1996. The data should be read in conjunction with the
financial statements and related notes which are incorporated into Part B by
reference to the Fund's Semi-Annual Report for the six months ended May 31,
1996.
<PAGE> 2

<TABLE>
<CAPTION>
VALUE FUND VALUE FUND VALUE FUND
A CLASS B CLASS C CLASS
PERIOD PERIOD PERIOD
12/1/95 12/1/95 12/1/95
THROUGH THROUGH THROUGH
5/31/96(1) 5/31/96(1) 5/31/96(1)
(UNAUDITED) (UNAUDITED) (UNAUDITED)
<S> <C> <C> <C>
Net asset value, beginning of period . . . . $22.760 $22.590 $22.760

INCOME FROM INVESTMENT OPERATIONS
- ---------------------------------
Net investment income (loss)(2) . . . . . . 0.036 (0.044) (0.043)
Net gains on securities
(both realized and unrealized) . . . . . . 2.574 2.559 2.563
----- ----- -----
Total from investment operations . . . . . 2.610 2.515 2.520
----- ----- -----

LESS DISTRIBUTIONS
- ------------------
Dividends from net investment income . . . . (0.240) (0.095) (0.280)
Distributions from capital gains . . . . . . (0.890) (0.890) (0.890)
Returns of capital . . . . . . . . . . . . . none none none
---- ---- ----
Total distributions . . . . . . . . . . . (1.130) (0.985) (1.170)
------ ------ ------

Net asset value, end of period . . . . . . . $24.240 $24.120 $24.110
======= ======= =======

TOTAL RETURN . . . . . . . . . . . . . . . . 11.97%(3) 11.55%(4) 11.57%(5)
- ------------

RATIOS/SUPPLEMENTAL DATA
- ------------------------

Net assets, end of period (000's omitted) . . $186,605 $9,517 $2,111
Ratio of expenses to average daily net assets 1.46% 2.16% 2.16%
Ratio of net investment income (loss)
to average daily net assets . . . . . . . . 0.31% (0.39%) (0.39%)
Portfolio turnover rate . . . . . . . . . . . 95% 95% 95%
</TABLE>

______________________________
(1) Ratios have been annualized but total return has not been annualized.
(2) The six months ended 5/31/96 per share information was based on the
average shares outstanding method.
(3) Does not include current maximum sales charge of 4.75% nor the 1%
limited contingent deferred sales charge that would apply in the event
of certain redemptions within 12 months of purchase.
(4) Does not include contingent deferred sales charge of 1%-4%, depending
upon the holding period.
(5) Does not include contingent deferred sales charge of 1%.
<PAGE> 3
* * *

Effective November 1, 1996, the "NAV/Delaware Group Asset Planner
Accommodation Program" described in the March 15, 1996 Supplement, which
permitted certain investors to invest in Delaware Group funds at net asset
value when using the Asset Planner service was discontinued. All share
purchases through Delaware Group Asset Planner are now subject to applicable
sales charges. Delaware Group Asset Planner is an asset allocation service
that gives investors, working with a financial professional, the ability to
more easily design and maintain investments in a diversified selection of
Delaware Group mutual funds.

Also effective November 1, 1996, the annual Asset Planner fee of $35
per Strategy will be waived until further notice. Investors who utilize the
Asset Planner for an individual retirement account ("IRA") will continue to pay
the annual IRA fee of $15 per Social Security number.

Exchanges from existing Delaware Group accounts into the Asset Planner
service may be made at net asset value under the circumstances described under
Investing by Exchange in the Fund's Prospectus.

<PAGE> 4
NOVEMBER 29, 1996

VALUE FUND INSTITUTIONAL CLASS

SUPPLEMENT TO PROSPECTUS DATED JANUARY 29, 1996

NAME CHANGE

Effective as of November 29, 1996, the name of Delaware Group Value
Fund Inc. was changed to Delaware Group Equity Funds V, Inc. Also effective as
of November 29, 1996, the name of Series I was changed to the Value Fund
series.

ADDITIONAL SERIES

FINANCIAL HIGHLIGHTS

The following unaudited financial highlights for the Value Fund
Institutional Class are derived from the unaudited financial statements of
Delaware Group Equity Funds V, Inc. for the six-month period ended May 31,
1996. The data should be read in conjunction with the financial statements and
related notes which are incorporated into Part B by reference to the Fund's
Semi-Annual Report for the six months ended May 31, 1996.

<PAGE> 5

<TABLE>
<CAPTION>
VALUE FUND
INSTITUTIONAL
CLASS
PERIOD
12/1/95
THROUGH
5/31/96(1)
(UNAUDITED)
<S> <C>
Net asset value, beginning of period . . . . . . . . . $22.860

INCOME FROM INVESTMENT OPERATIONS
- ---------------------------------
Net investment income(2) . . . . . . . . . . . . . . . 0.070
Net gains on securities
(both realized and unrealized) . . . . . . . . . . . 2.580
-----
Total from investment operations . . . . . . . . . . 2.650
-----

LESS DISTRIBUTIONS
- ------------------
Dividends from net investment income . . . . . . . . . (0.300)
Distributions from capital gains . . . . . . . . . . . (0.890)
Returns of capital . . . . . . . . . . . . . . . . . . none
----
Total distributions . . . . . . . . . . . . . . . . (1.190)
-------

Net asset value, end of period . . . . . . . . . . . . $24.320
=======

TOTAL RETURN . . . . . . . . . . . . . . . . . . . . . 12.12%
- ------------

RATIOS/SUPPLEMENTAL DATA
- ------------------------

Net assets, end of period (000's omitted) . . . . . . . $8,223
Ratio of expenses to average daily net assets . . . . . 1.16%
Ratio of net investment income to average daily net assets 0.61%
Portfolio turnover rate . . . . . . . . . . . . . . . . 95%
</TABLE>

______________________________

(1) Ratios have been annualized but total return has not been annualized.
(2) The six months ended 5/31/96 per share information was based on the
average shares outstanding method.
<PAGE> 6

The Delaware Group includes funds with a wide range of investment
objectives. Stock funds, income funds, tax-free funds, money market funds,
global and international funds and closed-end equity funds give investors the
ability to create a portfolio that fits their personal financial goals. For
more information, contact your financial adviser or call Delaware Group at
800-523-4640.

INVESTMENT MANAGER
Delaware Management Company, Inc.
One Commerce Square
Philadelphia, PA 19103

NATIONAL DISTRIBUTOR
Delaware Distributors, L.P.
1818 Market Street
Philadelphia, PA 19103

SHAREHOLDER SERVICING,
DIVIDEND DISBURSING,
ACCOUNTING SERVICES
AND TRANSFER AGENT
Delaware Service Company, Inc.
1818 Market Street
Philadelphia, PA 19103

LEGAL COUNSEL
Stradley, Ronon, Stevens & Young, LLP
One Commerce Square
Philadelphia, PA 19103

INDEPENDENT AUDITORS
Ernst & Young LLP
Two Commerce Square
Philadelphia, PA 19103

CUSTODIAN
The Chase Manhattan Bank
4 Chase Metrotech Center
Brooklyn, NY 11245

RETIREMENT INCOME FUND

___________________________________________

A CLASS
B CLASS
C CLASS
___________________________________________

PROSPECTUS

___________________________________________

NOVEMBER 29, 1996

DELAWARE
GROUP
<PAGE> 7

RETIREMENT INCOME FUND A CLASS SHARES
RETIREMENT INCOME FUND B CLASS SHARES
PROSPECTUS
RETIREMENT INCOME FUND C CLASS SHARES
NOVEMBER 29, 1996

1818 MARKET STREET, PHILADELPHIA, PA 19103

FOR PROSPECTUS AND PERFORMANCE:
NATIONWIDE 800-523-4640

INFORMATION ON EXISTING ACCOUNTS:
(SHAREHOLDERS ONLY)
NATIONWIDE 800-523-1918

DEALER SERVICES:
(BROKER/DEALERS ONLY)
NATIONWIDE 800-362-7500

REPRESENTATIVES OF FINANCIAL INSTITUTIONS:
NATIONWIDE 800-659-2259

This Prospectus describes the Retirement Income Fund A Class of shares
("Class A Shares"), the Retirement Income Fund B Class of shares ("Class B
Shares") and the Retirement Income Fund C Class of shares ("Class C Shares")
(individually, a "Class" and collectively, the "Classes") of the Retirement
Income Fund series (the "Fund") of Delaware Group Equity Funds V, Inc. ("Equity
Funds V, Inc."), a professionally- managed mutual fund of the series type. The
objective of the Fund is to seek to provide investors with high current income
and the potential for capital appreciation.

This Fund has the authority to invest up to all of its net assets in
lower rated securities, commonly known as "junk bonds" and "lower rated equity
securities." Such securities involve greater risks, including default risks,
than higher rated securities. Purchasers should carefully assess these risks
before investing in this Fund. See Investment Objective and Policies, Special
Risk Considerations, and Appendix C--Ratings.

This Prospectus sets forth information that you should read and
consider before you invest. Please retain it for future reference. The
Statement of Additional Information ("Part B") for Equity Funds V, Inc., dated
November 29, 1996, as it may be amended from time to time, contains additional
information about the Fund and has been filed with the Securities and Exchange
Commission. Part B is incorporated by reference into this Prospectus and is
available, without charge, by writing to Delaware Distributors, L.P. at the
above address or by calling the above telephone numbers.

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<PAGE> 8
The Fund also offers the Retirement Income Fund Institutional Class,
which is available for purchase only by certain investors. A prospectus for
the Retirement Income Fund Institutional Class can be obtained by writing to
Delaware Distributors, L.P. at the above address or by calling the above
numbers.

TABLE OF CONTENTS

<TABLE>
<S> <C> <C> <C>
COVER PAGE 1 CLASSES OF SHARES 24
SYNOPSIS 3 HOW TO BUY SHARES 33
SUMMARY OF EXPENSES 6 REDEMPTION AND EXCHANGE 39
INVESTMENT OBJECTIVE AND POLICIES 9 DIVIDENDS AND DISTRIBUTIONS 44
SUITABILITY 9 TAXES 45
INVESTMENT STRATEGY 9 CALCULATION OF OFFERING PRICE AND
SPECIAL RISK CONSIDERATIONS 15 NET ASSET VALUE PER SHARE 47
HIGH-YIELD SECURITIES 15 MANAGEMENT OF THE FUND 48
LOWER RATED CONVERTIBLE SECURITIES OTHER INVESTMENT POLICIES AND
AND PREFERRED STOCK 16 RISK CONSIDERATIONS 52
FOREIGN SECURITIES 17 APPENDIX A--INVESTMENT ILLUSTRATIONS 59
THE DELAWARE DIFFERENCE 19 APPENDIX B--CLASSES OFFERED 60
PLANS AND SERVICES 19 APPENDIX C--RATINGS 61
RETIREMENT PLANNING 22
</TABLE>

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

BE SURE TO CONSULT YOUR FINANCIAL ADVISER WHEN MAKING INVESTMENTS. MUTUAL
FUNDS CAN BE A VALUABLE PART OF YOUR FINANCIAL PLAN; HOWEVER, SHARES OF THE
FUND ARE NOT FDIC OR NCUSIF INSURED, ARE NOT GUARANTEED BY ANY BANK OR ANY
CREDIT UNION, ARE NOT OBLIGATIONS OF ANY BANK OR ANY CREDIT UNION, AND INVOLVE
INVESTMENT RISK, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL. SHARES OF THE FUND
ARE NOT BANK OR CREDIT UNION DEPOSITS.

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<PAGE> 9
SYNOPSIS

INVESTMENT OBJECTIVE
The objective of the Fund is to seek to provide investors with high
current income and an investment that has the potential for capital
appreciation. The Fund seeks to achieve its objective by investing principally
in equity securities which generate income through dividends or otherwise
("income generating equity securities") and debt securities including, but not
limited to, dividend paying common stocks, securities of real estate investment
trusts, preferred stocks, warrants, rights, convertible securities,
non-convertible debt securities, high-yield, high risk securities, investment
grade fixed-income securities, U.S. government securities and foreign equity
and fixed-income securities. For further details, see Investment Objective and
Policies.

RISK FACTORS
Prospective investors should consider the following:

1. The Fund has the authority to invest up to all of its net assets
in lower rated securities. Up to 45% of its net assets may be invested in
high-yield, higher risk fixed-income securities ("junk bonds"). In addition,
the Fund may invest in certain income generating equity securities such as
convertible securities and preferred stock, rated below investment grade.
These securities generally will have speculative characteristics similar to
those of lower rated fixed-income securities. The Fund may invest an
unrestricted portion of its total assets in such lower rated income generating
equity securities. Such securities may increase the risks of an investment in
this Fund. See High-Yield Securities under Special Risk Considerations.

2. Investing in securities of foreign governments and non-United
States companies which are generally denominated in foreign currencies and the
utilization of forward foreign currency exchange contracts involve certain risk
and opportunity considerations not typically associated with investing in
United States government securities and securities of United States companies.
See Special Risk Considerations and Other Investment Policies and Risk
Considerations.

3. The Fund has the ability to engage in options transactions for
hedging purposes to counterbalance portfolio volatility. While the Fund does
not engage in options transactions for speculative purposes, there are risks
which result from the use of options, and an investor should carefully review
the descriptions of these risks in this Prospectus. Certain options may be
considered to be derivative securities. See Options under Other Investment
Policies and Risk Considerations.

4. The Fund may invest up to 20% of its net assets in issuers
organized or having a majority of their assets or deriving a majority of their
operating income in foreign countries. Investment in foreign securities
involve risks which are in addition to those risks inherent in domestic
investments. See Foreign Securities under Special Risk Considerations.

INVESTMENT MANAGER, DISTRIBUTOR AND SERVICE AGENT

Delaware Management Company, Inc. (the "Manager") furnishes investment
management services to the Fund, subject to the supervision and direction of
Equity Funds V, Inc.'s Board of Directors. The Manager provides investment
management services to certain other funds in the Delaware Group. Delaware
Distributors, L.P. (the "Distributor") is the national distributor for the Fund
and for all of the

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<PAGE> 10
other mutual funds in the Delaware Group. Delaware Service Company, Inc. (the
"Transfer Agent") is the shareholder servicing, dividend disbursing, accounting
services and transfer agent for the Fund and for all of the other mutual funds
in the Delaware Group. See Summary of Expenses and Management of the Fund for
other information regarding the Manager and the fees payable under the Fund's
Investment Management Agreement.

SALES CHARGES

The price of Class A Shares includes a maximum front-end sales charge
of 4.75% of the offering price, which is equivalent to 4.94% of the amount
invested, based on an initial net asset value of $5.50 per share. The
front-end sales charge is reduced on certain transactions of at least $100,000
but under $1,000,000. There is no front-end sales charge on purchases of
$1,000,000 or more. Class A Shares are subject to annual 12b-1 Plan expenses
for the life of the investment.

The price of Class B Shares is equal to the net asset value per share.
Class B Shares are subject to a contingent deferred sales charge ("CDSC") of:
(i) 4% if shares are redeemed within two years of purchase; (ii) 3% if shares
are redeemed during the third or fourth year following purchase; (iii) 2% if
shares are redeemed during the fifth year following purchase; and (iv) 1% if
shares are redeemed during the sixth year following purchase. Class B Shares
are subject to annual 12b-1 Plan expenses for approximately eight years after
purchase. See Deferred Sales Charge Alternative - Class B Shares and Automatic
Conversion of Class B Shares under Classes of Shares.

The price of Class C Shares is equal to the net asset value per share.
Class C Shares are subject to a CDSC of 1% if shares are redeemed within 12
months of purchase. Class C Shares are subject to annual 12b-1 Plan expenses
for the life of the investment.

See Classes of Shares and Distribution (12b-1) and Service under
Management of the Fund.

PURCHASE AMOUNTS
Generally, the minimum initial investment in any Class is $1,000.
Subsequent investments must generally be at least $100.

Each purchase of Class B Shares is subject to a maximum purchase
limitation of $250,000. For Class C Shares, each purchase must be in an amount
that is less than $1,000,000. An investor may exceed these maximum purchase
limitations for Class B Shares and Class C Shares by making cumulative
purchases over a period of time. An investor should keep in mind, however,
that reduced front-end sales charges apply to investments of $100,000 or more
in Class A Shares, and that Class A Shares are subject to lower annual 12b-1
Plan expenses than Class B and Class C Shares and generally are not subject to
a CDSC. The minimum and maximum purchase amounts for retirement plans may
vary. See How to Buy Shares.

REDEMPTION AND EXCHANGE
Class A Shares of the Fund may be redeemed or exchanged at the net
asset value calculated after receipt of the redemption or exchange request.
Neither the Fund nor the Distributor assesses a charge for redemptions or
exchanges of Class A Shares, except for certain redemptions of shares purchased
at net

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<PAGE> 11
asset value, which may be subject to a CDSC if a dealer's commission was paid
in connection with such purchases. See Front-End Sales Charge Alternative -
Class A Shares under Classes of Shares.

Class B Shares and Class C Shares may be redeemed or exchanged at the
net asset value calculated after receipt of the redemption or exchange request
subject, in the case of redemptions, to any applicable CDSC. Neither the Fund
nor the Distributor assesses any charges other than the CDSC for redemptions or
exchanges of Class B or Class C Shares. There are certain limitations on an
investor's ability to exchange shares between the various classes of shares
that are offered. See Redemption and Exchange.

OPEN-END INVESTMENT COMPANY

Equity Funds V, Inc. was organized as a Maryland corporation in 1987
and is an open-end management investment company. The Fund's portfolio of
assets is diversified as defined by the Investment Company Act of 1940 (the
"1940 Act").

-5-
<PAGE> 12
SUMMARY OF EXPENSES

A general comparison of the sales arrangements and other expenses
applicable to Class A, Class B and Class C Shares follows:

<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C
SHAREHOLDER TRANSACTION EXPENSES SHARES SHARES SHARES
- ------------------------------------------------------------------------
<S> <C> <C> <C>
Maximum Sales Charge Imposed
on Purchases (as a percentage
of offering price). . . . . . . . . 4.75% None None

Maximum Sales Charge Imposed on
Reinvested Dividends (as a
percentage of offering price) . . . None None None

Maximum Contingent Deferred Sales
Charge (as a percentage of
original purchase price or
redemption proceeds,
as applicable). . . . . . . . . . . None* 4.00%* 1.00%*

Redemption Fees. . . . . . . . . . . . None** None** None**

ANNUAL OPERATING EXPENSES
(AS A PERCENTAGE OF CLASS A CLASS B CLASS C
AVERAGE DAILY NET ASSETS) SHARES SHARES SHARES
- ------------------------------------------------------------------------

Management Fees . . . . . . . . . . .
(after voluntary waivers) 0.00% 0.00% 0.00%

12b-1 Plan Expenses
(including service fees)
(after voluntary waivers). . . . . 0.00%+ 0.00%+ 0.00%+

Other Operating Expenses++. . . . . . 0.75% 0.75% 0.75%
----- ----- -----
Total Operating Expenses+++. . .
(after voluntary waivers) 0.75% 0.75% 0.75%
===== ===== =====
</TABLE>

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<PAGE> 13
*Class A purchases of $1 million or more may be made at net asset
value. However, if in connection with any such purchase a dealer commission is
paid to the financial adviser through whom such purchase is effected, a CDSC of
1% will be imposed on certain redemptions within 12 months of purchase
("Limited CDSC"). Class B Shares are subject to a CDSC of: (i) 4% if shares
are redeemed within two years of purchase; (ii) 3% if shares are redeemed
during the third or fourth year following purchase; (iii) 2% if shares are
redeemed during the fifth year following purchase; (iv) 1% if shares are
redeemed during the sixth year following purchase; and (v) 0% thereafter.
Class C Shares are subject to a CDSC of 1% if the shares are redeemed within 12
months of purchase. See Contingent Deferred Sales Charge for Certain
Redemptions of Class A Shares Purchased at Net Asset Value under Redemption and
Exchange; Deferred Sales Charge Alternative - Class B Shares and Level Sales
Charge Alternative - Class C Shares under Classes of Shares.

**CoreStates Bank, N.A. currently charges $7.50 per redemption for redemptions
payable by wire.

+Class A Shares, Class B Shares and Class C Shares are subject to separate
12b-1 Plans. Long-term shareholders may pay more than the economic equivalent
of the maximum front-end sales charges permitted by rules of the National
Association of Securities Dealers, Inc. (the "NASD"). The Distributor has
elected voluntarily to waive its right to receive 12b-1 Plan fees (including
service fees) from the commencement of the public offering of the Classes
through May 31, 1997. In absence of those waivers, 12b-1 Plan expenses would
equal 0.30% for Class A Shares and 1.00% for each of the Class B and Class C
Shares. See Distribution (12b-1) and Service under Management of the Fund.

++Because the Fund has no operating history, "Other Operating Expenses" for all
Classes are estimates based on expenses expected to be incurred during the
Fund's first fiscal year.

+++"Total Operating Expenses" and "Other Operating Expenses" for the Class A
Shares, the Class B Shares and the Class C Shares are based on estimated
amounts for the first full fiscal year of the Classes, after giving effect to
the voluntary expense waiver. As noted above, the Distributor has elected
voluntarily to waive 12b-1 Plan expenses through May 31, 1997. Also, the
Manager has elected voluntarily to waive that portion, if any, of the annual
management fees payable by the Fund and to pay certain expenses of the Fund to
the extent necessary to ensure that the Total Operating Expenses of each Class
of the Fund, excluding each such Class' 12b-1 fees, do not exceed 0.75%, from
the commencement of the public offering of the Classes through May 31, 1997.
If the voluntary expense waivers by the Distributor and the Manager were not in
effect, it is estimated that for the first full year, the Total Operating
Expenses, as a percentage of average daily net assets, would be 2.56%, 3.36%,
and 3.36%, respectively, for the Class A Shares, the Class B Shares and the
Class C Shares, reflecting management fees of 0.65%.

For expense information about the Retirement Income Fund Institutional
Class of shares, see the separate prospectus relating to that class.

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<PAGE> 14
The following example illustrates the expenses that an investor would
pay on a $1,000 investment over various time periods, assuming (1) a 5% annual
rate of return, (2) redemption and no redemption at the end of each time period
and (3) for Class B Shares and Class C Shares, payment of a CDSC at the time of
redemption, if applicable.

<TABLE>
<CAPTION>
ASSUMING REDEMPTION ASSUMING NO REDEMPTION
1 YEAR 3 YEARS 1 YEAR 3 YEARS
------ ------- ------ -------
<S> <C> <C> <C> <C>
CLASS A SHARES $55(1) $70 $55 $70

CLASS B SHARES(2) $48 $54 $8 $24

CLASS C SHARES $18 $24 $8 $24
</TABLE>

The purpose of the above tables is to assist the investor in
understanding the various costs and expenses that an investor in each Class
will bear directly or indirectly.

(1) Generally, no redemption charge is assessed upon redemption of Class A
Shares. Under certain circumstances, however, a Limited CDSC, which
has not been reflected in this calculation, may be imposed on certain
redemptions within 12 months of purchase. See Contingent Deferred
Sales Charge for Certain Redemptions of Class A Shares Purchased at
Net Asset Value under Redemption and Exchange.

(2) At the end of approximately eight years after purchase, Class B Shares
will be automatically converted into Class A Shares. The example
above does not assume conversion of Class B Shares since it reflects
figures only for one and three years. See Automatic Conversion of
Class B Shares under Classes of Shares for a description of the
automatic conversion feature.

THIS EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES OR PERFORMANCE. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE
SHOWN.

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<PAGE> 15
INVESTMENT OBJECTIVE AND POLICIES

SUITABILITY

The Fund may be suitable for the investor interested in high current
income and a potential for capital appreciation. In particular, the Fund may
be suitable for retirees who are seeking income that may be equivalent to or in
excess of that available from investments in certificates of deposit but who
also desire an investment which has the potential for capital appreciation as a
hedge against inflation. The Fund may also be suitable for investors seeking
to diversify their investment portfolio and obtain the potential for a moderate
level of income. The Manager believes that the Fund's combined investments in
income generating equity securities and debt securities could provide an income
return which would exceed that of an investment exclusively in equity
securities. Because the Fund will invest at least 50% of its total assets in
income generating equity and equity equivalent securities, the Manager also
believes that investors will have the opportunity to benefit from capital
appreciation. The net asset value per share of each Class may fluctuate in
response to the condition of individual companies and general market and
economic conditions and, as a result, the Fund is not appropriate for a
short-term investor. The Fund cannot assure a specific yield, rate of return
or that principal will be protected. However, through the cautious selection
and supervision of its portfolio, the Manager will strive to achieve the Fund's
investment objective.

The types of securities in which the Fund may invest are subject to
price fluctuations particularly due to changes in interest rates. Investors
should consider asset value fluctuation, as well as yield, in making an
investment decision. While investments in unrated, lower- rated and certain
restricted securities have the potential for higher yields, they are more
speculative and increase the credit risk of the Fund's portfolio. Changes in
the market value of portfolio securities will not affect interest income from
such securities, but will be reflected in a Class' net asset value. In
addition, investments in foreign securities involve special risks, including
those related to currency fluctuations, as well as to political, economic and
social situations different from and potentially more volatile than those in
the United States. Investors should be willing to accept the risks, including
the risk of net asset value fluctuations, associated with investing in these
types of securities. See Special Risk Considerations and Other Investment
Policies and Risk Considerations for a complete discussion of the risk factors
affecting the Fund's portfolio securities.

Investors should not consider a purchase of Fund shares as equivalent
to a complete investment or retirement program. The Delaware Group includes a
family of funds generally available through registered investment dealers which
may be used in concert with Fund shares to create a more complete investment or
retirement program.

Ownership of Fund shares can reduce the bookkeeping and administrative
inconveniences that would be connected with direct purchases of the types of
securities in which the Fund invests.

INVESTMENT STRATEGY
The objective of the Fund is to seek to provide investors with high
current income and an investment that has the potential for capital
appreciation. The Manager will seek to achieve this objective by investing in
a combination of income generating equity securities and debt securities
including, but not limited to, dividend paying common stocks, securities of
real estate investment trusts, preferred stocks, warrants, rights, convertible
securities, non-convertible debt securities, high-yield, high risk securities,

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<PAGE> 16
investment grade fixed-income securities, U.S. government securities and
foreign equity and fixed-income securities. Under normal circumstances, at
least 50% of the Fund's total assets will be invested in income generating
equity securities. In making investments in income generating equity
securities, the Fund may invest an unrestricted portion of its total assets in
convertible securities and preferred stock rated below investment grade. While
debt securities may comprise up to 50% of the Fund's total assets, no more than
45% of the Fund's total assets will be invested in high-yield, high risk debt
securities. No more than 25% of the Fund's total assets will be invested in
any one industry sector nor, as to 75% of the Fund's total assets, will more
than 5% be invested in securities of any one issuer. The Fund may invest up to
20% of its total assets in foreign equity and debt securities. The Fund will
not, however, invest more than 5% of its total assets in securities of issuers
principally located or principally operating in markets of emerging countries.

Within the percentage guidelines set forth above, the Manager will
determine the proportion of the Fund's assets that will be allocated to income
generating equity securities and equity equivalents and to debt securities,
based on its analysis of economic and market conditions and its assessment of
the income and potential for appreciation that can be achieved from investment
in such asset classes. It is expected that the proportion of the Fund's total
assets invested in income generating equity securities and equity equivalent
securities will vary from 50% to 100% of the Fund's total assets. The
proportion of the Fund's total assets in debt securities will correspondingly
vary from 0% to 50% of the Fund's total assets.

The following is a more detailed description of some of the securities
in which the Fund may invest.

COMMON STOCK
Common stock is generally considered to be shares of a corporation
that entitle the holder to a pro-rata share of the profits of the corporation,
if any, without a preference over any other shareholder or class of
shareholders, including holders of the corporation's preferred stock and other
senior equity. Common stock usually carries with it the right to vote and
frequently an exclusive right to do so. Holders of common stock also have the
right to participate in the remaining assets of the corporation after all other
claims are paid, including those of debt securities and preferred stock. In
selecting common stocks for investment, the Manager will focus primarily on a
security's dividend- paying capacity rather than on its potential for
appreciation.

PREFERRED STOCK
Generally, preferred stock receives dividends prior to distributions
on common stock and usually has a priority of claim over common stockholders if
the issuer of the stock is liquidated. Unlike common stock, preferred stock
does not usually have voting rights; preferred stock, in some instances, is
convertible into common stock. Dividends on typical preferred stock are
cumulative, causing dividends to accrue even if not declared by the board of
directors. There is, however, no assurance that dividends will be declared by
the boards of directors of issuers of the preferred stocks in which the Fund
invests. Preferred stock in which the Fund may invest may be rated below
investment grade (i.e., "Ba" or lower by Moody's Investors Service, Inc.
("Moody's") or "BB" or lower by Standard & Poor's Ratings Group ("S&P") or
similarly rated by other comparable rating agencies) or, if unrated, determined
to be of comparable quality by the Manager.

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<PAGE> 17
CONVERTIBLE SECURITIES
Traditional convertible securities include corporate bonds, notes and
preferred stocks that may be converted into or exchanged for common stock, and
other securities that also provide an opportunity for equity participation.
These securities are generally convertible either at a stated price or a stated
rate (that is, for a specific number of shares of common stock or other
security). As with other fixed- income securities, the price of a convertible
security to some extent varies inversely with interest rates. While providing
a fixed-income stream (generally higher in yield than the income derivable from
a common stock but lower than that afforded by a non-convertible debt
security), a convertible security also affords the investor an opportunity,
through its conversion feature, to participate in the capital appreciation of
the common stock into which it is convertible. As the market price of the
underlying common stock declines, convertible securities tend to trade
increasingly on a yield basis and so may not experience market value declines
to the same extent as the underlying common stock. When the market price of
the underlying common stock increases, the price of a convertible security
tends to rise as a reflection of the value of the underlying common stock. To
obtain such a higher yield, the Fund may be required to pay for a convertible
security an amount in excess of the value of the underlying common stock.
Common stock acquired by the Fund upon conversion of a convertible security
will generally be held for so long as the Manager anticipates such stock will
provide the Fund with opportunities which are consistent with the Fund's
investment objectives and policies. Convertible securities in which the Fund
may invest may be rated below investment grade (i.e., "Ba" or lower by Moody's
or "BB" or lower by S&P or similarly rated by other comparable rating agencies)
or, if unrated, determined to be of comparable quality by the Manager.

REAL ESTATE INVESTMENT TRUST SECURITIES

Real Estate Investment Trusts ("REITs") are pooled investment vehicles
which invest primarily in income-producing real estate or real estate related
loans or interests. REITs are generally classified as equity REITs, mortgage
REITs or a combination of equity and mortgage REITs. Equity REITs invest the
majority of their assets directly in real property and derive income primarily
from the collection of rents. Equity REITs can also realize capital gains by
selling properties that have appreciated in value. Mortgage REITs invest the
majority of their assets in real estate mortgages and derive income from the
collection of interest payments. Like investment companies such as Equity
Funds V, Inc., REITs are not taxed on income distributed to shareholders
provided they comply with several requirements of the Internal Revenue Code
(the "Code"). REITs are subject to substantial cash flow dependency, defaults
by borrowers, self-liquidation, and the risk of failing to qualify for tax-free
pass-through of income under the Code, and/or maintain exemptions from the 1940
Act. Equity REITs may be affected by changes in the value of the underlying
property owned by the REITs, while mortgage REITs may be affected by the
quality of any credit extended.

REITs invest all of their assets in the real estate and real estate
related sectors of the economy, and are subject to the risks of financing
projects. REITs may have limited financial resources, may trade less
frequently and in a limited volume, and are more volatile than the high-yield,
high risk securities in which the Fund may also invest.

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<PAGE> 18
HIGH-YIELD, HIGH RISK SECURITIES
DEBT SECURITIES
High-yield, high risk debt securities, like all debt securities,
represent money borrowed that must be repaid and has a fixed amount, a specific
maturity or maturities and usually a specific rate of interest or original
purchase discount. Unlike common and preferred stock, debt securities,
including high-yield, high risk debt securities, do not represent an equity
interest in the issuer. However, debt securities have a priority claim over
stockholders if the issuer is liquidated. The Fund may invest in a wide
variety of debt securities, although it is anticipated that under normal market
conditions, the Fund primarily will invest in high-yield corporate debt
obligations, including zero coupon bonds and pay-in-kind securities ("PIKs"),
debentures, convertible debentures, corporate notes (including convertible
notes) and units consisting of bonds with stock or warrants to buy stock
attached. See Zero Coupon Bonds and Pay-In-Kind Bonds under Other Investment
Policies and Risk Considerations.

The Fund will invest in both rated and unrated bonds. The rated bonds
that the Fund may purchase in this sector of its portfolio will be rated BBB or
lower by Standard & Poor's Ratings Group ("S&P") or Fitch Investors Service,
Inc. ("Fitch"), Baa or lower by Moody's Investors Service, Inc. ("Moody's"), or
similarly rated by another nationally recognized statistical rating
organization. See Appendix C to this Prospectus for more rating information
and High-Yield Securities under Special Risk Considerations for a description
of the risks associated with investing in lower-rated fixed-income securities.
Unrated bonds may be more speculative in nature than rated bonds.

CONVERTIBLE SECURITIES AND PREFERRED STOCK
The Fund may invest in convertible securities and preferred stock
rated below investment grade or which are unrated but are of comparable quality
as determined by the Manager. The Fund includes these securities in its income
generating equity securities category and they are in addition to the
high-yield, high risk debt securities discussed above. Such securities are
judged to have speculative elements and may be subject to greater risks with
respect to the timely repayment of principal and timely payment of interest and
dividends. See Investment Objectives and Policies--Investment Strategy and
Special Risk Considerations. Also see Lower Rated Convertible Securities and
Preferred Stock under Special Risk Considerations.

FOREIGN SECURITIES
The Fund may invest up to 20% of its total assets in securities of
issuers organized or having a majority of their assets or deriving a majority
of their operating income in foreign countries. These income generating equity
securities and debt securities include foreign government securities, equity
securities and debt obligations of foreign companies, and securities issued by
supranational entities. A supranational entity is an entity established or
financially supported by the national governments of one or more countries to
promote reconstruction or development. Examples of supranational entities
include, among others, the International Bank for Reconstruction and
Development (more commonly known as the World Bank), the European Economic
Community, the European Coal and Steel Community, the European Investment Bank,
the Inter-Development Bank, the Export-Import Bank and the Asian Development
Bank.

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<PAGE> 19

The Fund may invest in sponsored and unsponsored American Depositary
Receipts, European Depositary Receipts, or Global Depositary Receipts
("Depositary Receipts"). Depositary Receipts are receipts typically issued by
a bank or trust company which evidence ownership of underlying securities
issued by a foreign corporation. "Sponsored" Depositary Receipts are issued
jointly by the issuer of the underlying security and a depository, and
"unsponsored" Depositary Receipts are issued without the participation of the
issuer of the deposited security. The Fund may also invest in Brady Bonds,
which are described more fully under the Other Investment Policies and Risk
Considerations section of this Prospectus.

The Fund may invest in securities issued in any currency and may hold
foreign currencies. Securities of issuers within a given country may be
denominated in the currency of another country or in multinational currency
units, such as the European Currency Unit. The Fund may, from time to time,
purchase or sell foreign currencies and/or engage in forward foreign currency
transactions in order to expedite settlement of Fund transactions and to
minimize currency value fluctuations. See Other Investment Policies and Risk
Considerations for a further description of the Fund's foreign currency
transactions.

While the Fund may purchase securities of issuers in any foreign
country, developed and underdeveloped, no more than 5% of the Fund's assets may
be invested in direct obligations or equity securities of issuers located in
emerging market countries. See Emerging Market Securities under Special Risk
Considerations.

The Fund will invest in both rated and unrated foreign securities.
The rated securities that the Fund may purchase in the international sector of
its portfolio may include those rated BBB or lower by S&P or Fitch, Baa or
lower by Moody's, or similarly rated by another nationally reorganized
statistical rating organization. See Appendix C to this Prospectus for more
rating information and Foreign Securities and High-Yield Securities under
Special Risk Considerations for a description of the risks associated with
investing in foreign securities and lower-rated securities.

The Fund may also invest in zero coupon bonds, purchase shares of
other investment companies and may engage in short sales. See Zero Coupon
Bonds and Pay-In-Kind Bonds and Investment Company Securities under Other
Investment Polices and Risk Considerations.

* * *

For a description of the Fund's other investment policies and for a
further description of some of the policies described above, see Other
Investment Policies and Risk Considerations.

In unusual market conditions, in order to meet redemption requests,
for temporary defensive purposes, and pending investment or at such other times
when suitable income generating equity or debt securities are not available,
the Fund may hold a substantial portion of its assets in (i) cash, (ii) debt
securities issued by the U.S. government, its agencies or instrumentalities,
(iii) commercial paper, (iv) certificates of deposit and bankers' acceptances
or repurchase agreements with respect to any of the foregoing investments. The
Fund will only invest in commercial paper of companies rated "A-2" or better by
S&P or "P-2" or better by Moody's or similarly rated by another comparable
rating agency or, if not so rated, of equivalent investment quality as
determined by the Manager. See Appendix C to this Prospectus for more rating
information.

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<PAGE> 20
Although the Fund will constantly strive to attain its objective,
there can be no assurance that it will be attained.

The Fund's designation as an open-end investment company and as a
diversified fund may not be changed unless authorized by the vote of a majority
of the Fund's outstanding voting securities. A "majority vote of the
outstanding voting securities" is the vote by the holders of the lesser of a)
67% or more of the Fund's voting securities present in person or represented by
proxy if the holders of more than 50% of the outstanding voting securities of
the Fund are present or represented by proxy; or b) more than 50% of the
outstanding voting securities. Part B lists other more specific investment
restrictions of the Fund which may not be changed without a majority
shareholder vote.

The remaining investment policies of the Fund not identified above or
in Part B are not fundamental and may be changed by the Board of Directors of
Equity Funds V, Inc. without a shareholder vote.

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<PAGE> 21
SPECIAL RISK CONSIDERATIONS

GENERALLY
The Fund may invest a substantial portion of its assets in
fixed-income securities. The market values of fixed-income securities
generally fall when interest rates rise and, conversely, rise when interest
rates fall. Lower-rated and unrated fixed-income securities tend to reflect
short-term corporate and market developments to a greater extent than
higher-rated fixed-income securities, which react primarily to fluctuations in
the general level of interest rates. These lower-rated or unrated securities
generally have higher yields, but, as a result of factors such as reduced
creditworthiness of issuers, increased risk of default and a more limited and
less liquid secondary market, are subject to greater volatility and risk of
loss of income and principal than are higher-rated securities. The Manager
will attempt to reduce such risk through portfolio diversification, credit
analysis, and attention to trends in the economy, industries and financial
markets.

HIGH-YIELD SECURITIES

The Fund may invest up to 45% of its total assets in bonds rated BBB
or lower by S&P or Fitch, Baa or lower by Moody's, or similarly rated by
another rating organization, and in unrated corporate bonds. See Appendix C to
this Prospectus for more rating information. Investing in these so-called
"junk" or "high-yield" bonds entails certain risks, including the risk of loss
of principal and default on interest payments, which may be greater than the
risks involved in investment grade bonds, and which should be considered by
investors contemplating an investment in the Fund. Such bonds are sometimes
issued by companies whose earnings at the time of issuance are less than the
projected debt service on the junk bonds. In addition to the considerations
discussed elsewhere in this Prospectus, those risks include the following:

Youth and Volatility of the High-Yield Market. Although the market for
high-yield bonds has been in existence for many years, including periods of
economic downturns, the high-yield market grew rapidly during the long economic
expansion which took place in the United States during the 1980s. During that
economic expansion, the use of high-yield debt securities to fund highly
leveraged corporate acquisitions and restructurings increased dramatically. As
a result, the high-yield market grew substantially during that economic
expansion. Although experts disagree on the impact recessionary periods have
had and will have on the high-yield market, some analysts believe a protracted
economic downturn would severely disrupt the market for high-yield bonds, would
adversely affect the value of outstanding bonds and would adversely affect the
ability of high-yield issuers to repay principal and interest. Those analysts
cite volatility experienced in the high-yield market in the past as evidence
for their position. It is likely that protracted periods of economic
uncertainty would result in increased volatility in the market prices of
high-yield bonds, an increase in the number of high-yield bond defaults and
corresponding volatility in a Class' net asset value.

Redemptions. If, as a result of volatility in the high-yield market or other
factors, the Fund experiences substantial net redemptions of the Fund's shares
for a sustained period of time (i.e., more shares of the Fund are redeemed than
are purchased), the Fund may be required to sell certain of its high-yield
securities without regard to the investment merits of the securities to be
sold. If the Fund sells a substantial number of securities to generate
proceeds for redemptions, the asset base of the Fund will decrease and the
Fund's expense ratios may increase.

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<PAGE> 22
Liquidity and Valuation. The secondary market for high-yield securities is
currently dominated by institutional investors, including mutual funds, and
certain financial institutions. There is generally no established retail
secondary market for high-yield securities. As a result, the secondary market
for high-yield securities is more limited and less liquid than other secondary
securities markets. The high-yield secondary market is particularly
susceptible to liquidity problems when the institutions that dominate it
temporarily cease buying bonds for regulatory, financial or other reasons, such
as the savings and loan crisis. A less liquid secondary market may have an
adverse effect on the Fund's ability to dispose of particular issues, when
necessary, to meet the Fund's liquidity needs or in response to a specific
economic event, such as the deterioration in the creditworthiness of the
issuer. In addition, a less liquid secondary market makes it more difficult
for the Fund to obtain precise valuations of the high-yield securities in its
portfolio. During periods involving such liquidity problems, judgment plays a
greater role in valuing high-yield securities than is normally the case. The
secondary market for high-yield securities is also generally considered to be
more likely to be disrupted by adverse publicity and investor perceptions than
the more established secondary securities markets. The privately placed
high-yield securities that the Fund may purchase are particularly susceptible
to the liquidity and valuation risks outlined above.

LOWER RATED CONVERTIBLE SECURITIES AND PREFERRED STOCK

The Fund may invest in lower rated convertible securities and
preferred stock (i.e., "Ba" or lower for convertible securities or "ba" or
lower for preferred stock by Moody's or "BB" or lower for convertible
securities or preferred stock by S&P or similarly rated by other comparable
rating agencies) or, if unrated, determined to be of comparable quality by the
Manager. Investing in lower rated convertible securities and preferred stock
entails certain risks, including the risk of loss of principal which may be
greater than the risks involved in investing in higher rated securities, and
which should be considered by investors contemplating an investment in the
Fund. The Fund may have difficulty disposing of such securities because the
trading market for such securities may be thinner than the market for higher
rated convertible securities and preferred stock. To the extent a secondary
trading market for these securities does exist, it generally is not as liquid
as the secondary trading market for higher rated securities. The lack of a
liquid secondary market as well as adverse publicity with respect to these
securities, may have an adverse impact on market price and the Fund's ability
to dispose of particular issues in response to a specific economic event such
as a deterioration in the creditworthiness of the issuer. The lack of a liquid
secondary market for certain securities also may make it more difficult for the
Fund to obtain accurate market quotations for purposes of pricing the Fund's
portfolio and calculating its net asset value. The market behavior of
convertible securities and preferred stocks in lower rating categories is often
more volatile than that of higher quality securities. Lower quality
convertible securities and preferred stocks are judged by Moody's and S&P to
have speculative elements or characteristics; their future cannot be considered
as well assured and earnings and asset protection may be moderate or poor in
comparison to investment grade securities. In addition, such lower quality
securities face major ongoing uncertainties or exposure to adverse business,
financial or economic conditions, which could lead to inadequate capacity to
meet timely payments. A description of the ratings used by Moody's and S&P for
such securities is set forth in Appendix C to this Prospectus. See also
Special Risk Considerations--High-Yield Securities."

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<PAGE> 23
FOREIGN SECURITIES
The Fund has the ability to purchase income generating equity
securities and debt securities in any foreign country. Investors should
consider carefully the substantial risks involved in investing in securities
issued by companies and governments of foreign nations. These risks are in
addition to the usual risks inherent in domestic investments. There is the
possibility of expropriation, nationalization or confiscatory taxation,
taxation of income earned in foreign nations or other taxes imposed with
respect to investments in foreign nations, foreign exchange controls (which may
include suspension of the ability to transfer currency from a given country),
default in foreign government securities, political or social instability or
diplomatic developments which could affect investments in securities of issuers
in those nations.

In addition, in many countries, there is substantially less publicly
available information about issuers than is available in reports about
companies in the United States. Foreign companies are not subject to uniform
accounting, auditing and financial reporting standards, and auditing practices
and requirements may not be comparable to those applicable to United States
companies. Consequently, financial data about foreign companies may not
accurately reflect the real condition of those issuers and securities markets.

Further, the Fund may encounter difficulty or be unable to pursue
legal remedies and obtain judgments in foreign courts. Commission rates on
securities transactions in foreign countries, which are sometimes fixed rather
than subject to negotiation as in the United States, are likely to be higher.
Further, the settlement period of securities transactions in foreign markets
may be longer than in domestic markets, and may be subject to administrative
uncertainties. In many foreign countries, there is less government supervision
and regulation of business and industry practices, stock exchanges, brokers and
listed companies than in the United States, and capital requirements for
brokerage firms are generally lower. The foreign securities markets of many of
the countries in which the Fund may invest may also be smaller, less liquid and
subject to greater price volatility than those in the United States.

Emerging Market Securities. The Fund may invest up to 5% of its
assets in income generating equity securities and debt securities of issuers
located in emerging market nations. Compared to the United States and other
developed countries, emerging countries may have volatile social conditions,
relatively unstable governments and political systems, economies based on only
a few industries and economic structures that are less diverse and mature, and
securities markets that trade a small number of securities, which can result in
a low or nonexistent volume of trading. Prices in these securities markets
tend to be volatile and, in the past, securities in these countries have
offered greater potential for gain (as well as loss) than securities of
companies located in developed countries. Until recently, there has been an
absence of a capital market structure or market-oriented economy in certain
emerging countries. Further, investments and opportunities for investments by
foreign investors are subject to a variety of national policies and
restrictions in many emerging countries. Also, the repatriation of both
investment income and capital from several foreign countries is restricted and
controlled under certain regulations, including, in some cases, the need for
certain governmental consents. Countries such as those in which the Fund may
invest may have historically experienced and may continue to experience,
substantial, and in some periods extremely high rates of inflation for many
years, high interest rates, exchange rate fluctuations or currency
depreciation, large amounts of external debt, balance of payments and trade
difficulties and extreme poverty and unemployment. Other factors which may
influence the ability or willingness to service debt include, but are not
limited to, a country's cash flow situation, the availability of sufficient
foreign

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<PAGE> 24

exchange on the date a payment is due, the relative size of its debt service
burden to the economy as a whole, its government's policy towards the
International Monetary Fund, the World Bank and other international agencies
and the political constraints to which a government debtor may be subject. The
Manager currently considers countries such as Argentina, Brazil, Chile, China,
Mexico, India, Portugal, Poland and Thailand to be emerging markets. This list
is not intended to be exhaustive, but rather representative of the types of
countries now considered by the Manager to present special investment risks.

See Other Investment Policies and Risk Considerations for a further
description of certain risks associated with certain of the Fund's investments,
including the risks associated with investments in foreign government
securities and engaging in foreign currency transactions and options.

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THE DELAWARE DIFFERENCE

PLANS AND SERVICES
The Delaware Difference is our commitment to provide you with superior
information and quality service on your investments in the Delaware Group of
funds.

SHAREHOLDER PHONE DIRECTORY

INVESTOR INFORMATION CENTER
800-523-4640

FUND INFORMATION; LITERATURE; PRICE; YIELD AND PERFORMANCE FIGURES

SHAREHOLDER SERVICE CENTER
800-523-1918

INFORMATION ON EXISTING REGULAR INVESTMENT ACCOUNTS AND RETIREMENT PLAN
ACCOUNTS; WIRE INVESTMENTS; WIRE LIQUIDATIONS; TELEPHONE
LIQUIDATIONS AND TELEPHONE EXCHANGES

DELAPHONE
800-362-FUND
(800-362-3863)

PERFORMANCE INFORMATION
You can call the Investor Information Center at any time for current
yield information. Current yield and total return information may also be
included in advertisements and information given to shareholders. Yields are
computed on an annual basis over a 30-day period.

SHAREHOLDER SERVICES
During business hours, you can call the Delaware Group's Shareholder
Service Center. Our representatives can answer any questions about your
account, the Fund, various service features and other funds in the Delaware
Group.

DELAPHONE SERVICE
Delaphone is an account inquiry service for investors with
Touch-Tone(R) phone service. It enables you to get information on your account
faster than the mailed statements and confirmations. Delaphone also provides
current performance information on the Fund, as well as other funds in the
Delaware Group. Delaphone is available seven days a week, 24 hours a day.

DIVIDEND PAYMENTS

Dividends, capital gains and other distributions are automatically
reinvested in your account. You may, however, elect to have the dividends
earned in one fund automatically invested in another Delaware Group fund with a
different investment objective, subject to certain exceptions and limitations.

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<PAGE> 26
For more information, see Additional Methods of Adding to Your
Investment - Dividend Reinvestment Plan under How to Buy Shares or call the
Shareholder Service Center.

STATEMENTS AND CONFIRMATIONS
You will receive quarterly statements of your account summarizing all
transactions during the period. A confirmation statement will be sent
following all transactions other than those involving a reinvestment of
dividends. You should examine statements and confirmations immediately and
promptly report any discrepancy by calling the Shareholder Service Center.

DUPLICATE CONFIRMATIONS
If your financial adviser or investment dealer is noted on your
investment application, we will send a duplicate confirmation to him or her.
This makes it easier for your adviser to help you manage your investments.

TAX INFORMATION

Each year, Equity Funds V, Inc. will mail to you information on the
tax status of your dividends and distributions.

RIGHT OF ACCUMULATION
With respect to Class A Shares, the Right of Accumulation feature
allows you to combine the value of your current holdings of Class A Shares,
Class B Shares and Class C Shares of the Fund with the dollar amount of new
purchases of Class A Shares of the Fund to qualify for a reduced front-end
sales charge on such purchases of Class A Shares. Under the COMBINED PURCHASES
PRIVILEGE, you may also include certain shares that you own in other funds in
the Delaware Group. See Classes of Shares.

LETTER OF INTENTION
The Letter of Intention feature permits you to obtain a reduced
front-end sales charge on purchases of Class A Shares by aggregating certain of
your purchases of Delaware Group fund shares over a 13-month period. See
Classes of Shares and Part B.

12-MONTH REINVESTMENT PRIVILEGE
The 12-Month Reinvestment Privilege permits you to reinvest proceeds
from a redemption of Class A Shares, within one year of the date of the
redemption, without paying a front-end sales charge. See Part B.

EXCHANGE PRIVILEGE
The Exchange Privilege permits shareholders to exchange all or part of
their shares into shares of the other funds in the Delaware Group, subject to
certain exceptions and limitations. For additional information on exchanges,
see Investing by Exchange under How to Buy Shares and Redemption and Exchange.

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<PAGE> 27
WEALTH BUILDER OPTION
You may elect to invest in the Fund through regular liquidations of
shares in your accounts in other funds in the Delaware Group. Investments
under this feature are exchanges and are therefore subject to the same
conditions and limitations as other exchanges of Fund shares. See Additional
Methods of Adding to Your Investment - Wealth Builder Option and Investing by
Exchange under How to Buy Shares, and Redemption and Exchange.

DELAWARE GROUP ASSET PLANNER
Delaware Group Asset Planner is an asset allocation service that gives
investors, working with a professional financial adviser, the ability to more
easily design and maintain investments in a diversified selection of Delaware
Group mutual funds. The Asset Planner service offers a choice of four
predesigned allocation strategies (each with a different risk/reward profile)
made up of separate investments in predetermined percentages of Delaware Group
funds. With the guidance of a financial adviser, investors may also tailor an
allocation strategy that meets their personal needs and goals. See How to Buy
Shares.

FINANCIAL INFORMATION ABOUT THE FUND

Each fiscal year, you will receive an audited annual report and an
unaudited semi-annual report. These reports provide detailed information about
the Fund's investments and performance. Equity Funds V, Inc.'s fiscal year
ends on November 30.

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<PAGE> 28
RETIREMENT PLANNING

Under certain circumstances, an investment in the Fund may be suitable
for tax-deferred retirement plans. Among the retirement plans noted below,
Class B Shares are available for investment only by Individual Retirement
Accounts, Simplified Employee Pension Plans, 457 Deferred Compensation Plans
and 403(b)(7) Deferred Compensation Plans.

Retirement plans may be subject to plan establishment fees, annual
maintenance fees and/or other administrative or trustee fees. Fees are based
upon the number of participants in the plan as well as the services selected.
Additional information about fees is included in retirement plan materials.
Fees are quoted upon request. Certain shareholder investment services
available to non-retirement plan shareholders may not be available to
retirement plan shareholders. Certain retirement plans may qualify to purchase
the Retirement Income Fund Institutional Class. For additional information on
any of the plans and Delaware's retirement services, call the Shareholder
Service Center or see Part B.

INDIVIDUAL RETIREMENT ACCOUNT ("IRA")
Individuals, even if they participate in an employer-sponsored
retirement plan, may establish their own retirement program for investments in
each of the Classes. Contributions to an IRA may be tax-deductible and
earnings are tax-deferred. Under the Tax Reform Act of 1986, the tax
deductibility of IRA contributions is restricted, and in some cases eliminated,
for individuals who participate in certain employer-sponsored retirement plans
and whose annual income exceeds certain limits. Existing IRAs and future
contributions up to the IRA maximums, whether deductible or not, still earn on
a tax-deferred basis.

SIMPLIFIED EMPLOYEE PENSION PLAN ("SEP/IRA")
A SEP/IRA may be established by an employer who wishes to sponsor a
tax-sheltered retirement program by making contributions on behalf of all
eligible employees. Each of the Classes is available for investment by a
SEP/IRA.

SALARY REDUCTION SIMPLIFIED EMPLOYEE PENSION PLAN ("SAR/SEP")

Offers employers with 25 or fewer eligible employees the ability to
establish a SEP/IRA that permits salary deferral contributions. An employer
may also elect to make additional contributions to this plan. Class B Shares
are not available for purchase by such plans. Under the Small Business
Protection Act of 1996, an employer cannot establish a new SAR/SEP after
December 31, 1996. Plans established before January 1, 1997 can continue to
operate without change.

403(B)(7) DEFERRED COMPENSATION PLAN
Permits employees of public school systems or of certain types of
non-profit organizations to enter into a deferred compensation arrangement for
the purchase of shares of each of the Classes.

457 DEFERRED COMPENSATION PLAN
Permits employees of state and local governments and certain other
entities to enter into a deferred compensation arrangement for the purchase of
shares of each of the Classes.

PROTOTYPE PROFIT SHARING OR MONEY PURCHASE PENSION PLAN
Offers self-employed individuals, partnerships and corporations a
tax-qualified plan which provides for the investment of contributions in Class
A Shares or Class C Shares. Class B Shares are not available for purchase by
such plans.

-22-
<PAGE> 29
PROTOTYPE 401(K) DEFINED CONTRIBUTION PLAN
Permits employers to establish a tax-qualified plan based on salary
deferral contributions for investment in Class A or Class C Shares. Class B
Shares are not available for purchase by such plans.

ALLIED PLANS
Class A Shares are available for purchase by participants in certain
401(k) Defined Contribution Plans ("Allied Plans") which are made available
under a joint venture agreement between the Distributor and another institution
through which mutual funds are marketed and which allow investments in Class A
Shares of designated Delaware Group funds ("eligible Delaware Group fund
shares"), as well as shares of designated classes of non-Delaware Group funds
("eligible non-Delaware Group fund shares"). Class B Shares and Class C Shares
are not eligible for purchase by Allied Plans.

With respect to purchases made in connection with an Allied Plan, the
value of eligible Delaware Group and eligible non-Delaware Group fund shares
held by the Allied Plan may be combined with the dollar amount of new purchases
by that Allied Plan to obtain a reduced front-end sales charge on additional
purchases of eligible Delaware Group fund shares. See Front-End Sales Charge
Alternative - Class A Shares under Classes of Shares.

Participants in Allied Plans may exchange all or part of their
eligible Delaware Group fund shares for other eligible Delaware Group fund
shares or for eligible non-Delaware Group fund shares at net asset value
without payment of a front-end sales charge. However, exchanges of eligible
fund shares, both Delaware Group and non-Delaware Group, which were not subject
to a front-end sales charge, will be subject to the applicable sales charge if
exchanged for eligible Delaware Group fund shares to which a sales charge
applies. No sales charge will apply if the eligible fund shares were
previously acquired through the exchange of eligible shares on which a sales
charge was already paid or through the reinvestment of dividends. See
Investing by Exchange.

A dealer's commission may be payable on purchases of eligible Delaware
Group fund shares under an Allied Plan. In determining a financial adviser's
eligibility for a dealer's commission on net asset value purchases of eligible
Delaware Group fund shares in connection with Allied Plans, all participant
holdings in the Allied Plan will be aggregated. See Front-End Sales Charge
Alternative - Class A Shares under Classes of Shares.

The Limited CDSC is applicable to redemptions of net asset value
purchases from an Allied Plan on which a dealer's commission has been paid.
Waivers of the Limited CDSC, as described under Waiver of Limited Contingent
Deferred Sales Charge - Class A Shares under Redemption and Exchange, apply to
redemptions by participants in Allied Plans except in the case of exchanges
between eligible Delaware Group and non-Delaware Group fund shares. When
eligible Delaware Group fund shares are exchanged into eligible non-Delaware
Group fund shares, the Limited CDSC will be imposed at the time of the
exchange, unless the joint venture agreement specifies that the amount of the
Limited CDSC will be paid by the financial adviser or selling dealer. See
Contingent Deferred Sales Charge for Certain Redemptions of Class A Shares
Purchased at Net Asset Value under Redemption and Exchange.

-23-
<PAGE> 30
CLASSES OF SHARES

ALTERNATIVE PURCHASE ARRANGEMENTS
Shares may be purchased at a price equal to the next determined net
asset value per share, subject to a sales charge which may be imposed, at the
election of the purchaser, at the time of the purchase for Class A Shares
("front-end sales charge alternative"), or on a contingent deferred basis for
Class B Shares ("deferred sales charge alternative") or Class C Shares ("level
sales charge alternative").

Class A Shares. An investor who elects the front-end sales charge
alternative acquires Class A Shares, which incur a sales charge when they are
purchased, but generally are not subject to any sales charge when they are
redeemed. Absent any applicable fee waiver, Class A Shares are subject to
annual 12b-1 Plan expenses of up to a maximum of 0.30% average daily net assets
of such shares. Certain purchases of Class A Shares qualify for reduced
front-end sales charges. See Front-End Sales Charge Alternative - Class A
Shares. See also Contingent Deferred Sales Charge for Certain Redemptions of
Class A Shares Purchased at Net Asset Value under Redemption and Exchange and
Distribution (12b-1) and Service under Management of the Fund.

Class B Shares. An investor who elects the deferred sales charge
alternative acquires Class B Shares, which do not incur a front-end sales
charge when they are purchased, but are subject to a contingent deferred sales
charge if they are redeemed within six years of purchase. Absent any
applicable fee waiver, Class B Shares are subject to annual 12b-1 Plan expenses
of up to a maximum of 1% (0.25% of which are service fees to be paid to the
Distributor, dealers or others for providing personal service and/or
maintaining shareholder accounts) of average daily net assets of such shares
for approximately eight years after purchase. Class B Shares permit all of the
investor's dollars to work from the time the investment is made. If no waiver
of 12b-1 fees is in effect, the higher 12b-1 Plan expenses paid by Class B
Shares will cause such shares to have a higher expense ratio and to pay lower
dividends than Class A Shares. At the end of approximately eight years after
purchase, the Class B Shares will automatically be converted into Class A
Shares and, thereafter, for the life of the investment, the annual 0.30% 12b-1
Plan fees for the Class A Shares will apply. See Automatic Conversion of Class
B Shares, below.

Class C Shares. An investor who elects the level sales charge
alternative acquires Class C Shares, which do not incur a front-end sales
charge when they are purchased, but are subject to a contingent deferred sales
charge if they are redeemed within 12 months of purchase. Absent any
applicable fee waiver, Class C Shares are subject to annual 12b-1 Plan expenses
of up to a maximum of 1% (0.25% of which are service fees to be paid to the
Distributor, dealers or others for providing personal service and/or
maintaining shareholder accounts) of average daily net assets of such shares
for the life of the investment. If no waiver of 12b-1 fees is in effect, the
higher 12b-1 Plan expenses paid by Class C Shares will cause such shares to
have a higher expense ratio and to pay lower dividends than Class A Shares.
Unlike Class B Shares, Class C Shares do not convert to another class.

-24-
<PAGE> 31

The alternative purchase arrangements described above permit investors
to choose the method of purchasing shares that is most suitable given the
amount of their purchase, the length of time they expect to hold their shares
and other relevant circumstances. Investors should determine whether, given
their particular circumstances, it is more advantageous to purchase Class A
Shares and incur a front-end sales charge, purchase Class B Shares and have the
entire initial purchase amount invested in the Fund with their investment being
subject to a CDSC if they redeem shares within six years of purchase, or
purchase Class C Shares and have the entire initial purchase amount invested in
the Fund with their investment being subject to a CDSC if they redeem shares
within 12 months of purchase. In addition, investors should consider the level
of annual 12b-1 Plan expenses applicable to each Class. If no waiver of 12b-1
fees is in effect, the higher 12b-1 Plan expenses on Class B Shares and Class C
Shares will be offset to the extent a return is realized on the additional
money initially invested upon the purchase of such shares. However, there can
be no assurance as to the return, if any, that will be realized on such
additional money. In comparing Class B Shares to Class C Shares, investors
should also consider the desirability of an automatic conversion feature, which
is available only for Class B Shares.

Prospective investors should refer to Appendix A--Investment
Illustrations in this Prospectus for an illustration of the potential effect
that each of the purchase options may have on a long-term shareholder's
investment.

For the distribution and related services provided to, and the
expenses borne on behalf of, the Fund, absent any applicable fee waiver, the
Distributor and others will be paid, in the case of the Class A Shares, from
the proceeds of the front-end sales charge and 12b-1 Plan fees and, in the case
of the Class B Shares and the Class C Shares, from the proceeds of the 12b-1
Plan fees and, if applicable, the CDSC incurred upon redemption. Financial
advisers may receive different compensation for selling Class A, Class B and
Class C Shares. Investors should understand that the purpose and function of
the respective 12b-1 Plans and the CDSCs applicable to Class B Shares and Class
C Shares are the same as those of the 12b-1 Plan and the front-end sales charge
applicable to Class A Shares in that such fees and charges are used to finance
the distribution of the respective Classes. See 12b-1 Distribution Plans -
Class A, Class B and Class C Shares.

Dividends paid on Class A, Class B and Class C Shares, to the extent
any dividends are paid, will be calculated in the same manner, at the same
time, on the same day and will be in the same amount, except that, when
assessed, the additional amount of 12b-1 Plan expenses relating to Class B
Shares and Class C Shares will be borne exclusively by such shares. See
Calculation of Offering Price and Net Asset Value Per Share.

The NASD has adopted certain rules relating to investment company
sales charges. Equity Funds V, Inc. and the Distributor intend to operate in
compliance with these rules.

FRONT-END SALES CHARGE ALTERNATIVE - CLASS A SHARES
Class A Shares may be purchased at the offering price, which reflects
a maximum front-end sales charge of 4.75%. See Calculation of Offering Price
and Net Asset Value Per Share.

Purchases of $100,000 or more carry a reduced front-end sales charge
as shown in the following table.

-25-
<PAGE> 32
RETIREMENT INCOME FUND A CLASS
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
Dealer's
Front-End Sales Charge Commission***
as % of as % of
Offering Amount Offering
Amount of Purchase Price Invested** Price
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Less than $100,000 4.75% 4.94% 4.00%

$100,000 but
under $250,000 3.75 3.89 3.00

$250,000 but
under $500,000 2.50 2.59 2.00

$500,000 but
under $1,000,000* 2.00 2.00 1.60
</TABLE>

* There is no front-end sales charge on purchases of Class A Shares of
$1 million or more but, under certain limited circumstances, a 1%
Limited CDSC may apply upon redemption of such shares.

** Based upon the initial net asset value of $8.50 per share of the Class
A Shares.

*** Financial institutions or their affiliated brokers may receive an
agency transaction fee in the percentages set forth above.
- --------------------------------------------------------------------------------

The Fund must be notified when a sale takes place which would qualify
for the reduced front-end sales charge on the basis of previous or
current purchases. The reduced front-end sales charge will be granted
upon confirmation of the shareholder's holdings by the Fund. Such
reduced front-end sales charges are not retroactive.

From time to time, upon written notice to all of its dealers, the
Distributor may hold special promotions for specified periods during
which the Distributor may reallow to dealers up to the full amount of
the front-end sales charge shown above. In addition, certain dealers
who enter into an agreement to provide extra training and information
on Delaware Group products and services and who increase sales of
Delaware Group funds may receive an additional commission of up to
0.15% of the offering price. Dealers who receive 90% or more
of the sales charge may be deemed to be underwriters under the
Securities Act of 1933.
- --------------------------------------------------------------------------------

-26-
<PAGE> 33
For initial purchases of Class A Shares of $1,000,000 or more, a
dealer's commission may be paid by the Distributor to financial advisers
through whom such purchases are made in accordance with the following schedule:

<TABLE>
<CAPTION>
DEALER'S COMMISSION
(as a percentage of
AMOUNT OF PURCHASE amount purchased)
------------------ -------------------
<S> <C>
Up to $2 million 1.00%
Next $1 million up to $3 million 0.75
Next $2 million up to $5 million 0.50
Amount over $5 million 0.25
</TABLE>

In determining a financial adviser's eligibility for the dealer's
commission, purchases of Class A Shares of other Delaware Group funds as to
which a Limited CDSC applies may be aggregated with those of the Class A Shares
of the Fund. Financial advisers also may be eligible for a dealer's commission
in connection with certain purchases made under a Letter of Intention or
pursuant to an investor's Right of Accumulation. Financial advisers should
contact the Distributor concerning the applicability and calculation of the
dealer's commission in the case of combined purchases.

An exchange from other Delaware Group funds will not qualify for
payment of the dealer's commission, unless a dealer's commission or similar
payment has not been previously paid on the assets being exchanged. The
schedule and program for payment of the dealer's commission are subject to
change or termination at any time by the Distributor at its discretion.

Redemptions of Class A Shares purchased at net asset value may result
in the imposition of a Limited CDSC if the dealer's commission described above
was paid in connection with the purchase of those shares. See Contingent
Deferred Sales Charge for Certain Redemptions of Class A Shares Purchased at
Net Asset Value under Redemption and Exchange.

COMBINED PURCHASES PRIVILEGE
By combining your holdings of Class A Shares with your holdings of
Class B Shares and/or Class C Shares of the Fund and shares of the other funds
in the Delaware Group, except those noted below, you can reduce the front-end
sales charges on any additional purchases of Class A Shares. Shares of
Delaware Group Premium Fund, Inc. beneficially owned in connection with
ownership of variable insurance products may be combined with other Delaware
Group fund holdings. Shares of other funds that do not carry a front-end sales
charge or CDSC may not be included unless they were acquired through an
exchange from a Delaware Group fund that does carry a front-end sales charge or
CDSC.

This privilege permits you to combine your purchases and holdings with
those of your spouse, your children under 21 and any trust, fiduciary or
retirement account for the benefit of such family members.

-27-
<PAGE> 34
It also permits you to use these combinations under a Letter of
Intention. A Letter of Intention allows you to make purchases over a 13-month
period and qualify the entire purchase for a reduction in front-end sales
charges on Class A Shares.

Combined purchases of $1,000,000 or more, including certain purchases
made at net asset value pursuant to a Right of Accumulation or under a Letter
of Intention, may result in the payment of a dealer's commission and the
applicability of a Limited CDSC. Investors should consult their financial
advisers or the Shareholder Service Center about the operation of these
features. See Front-End Sales Charge Alternative - Class A Shares, above.

BUYING CLASS A SHARES AT NET ASSET VALUE
Class A Shares of the Fund may be purchased at net asset value under
the Delaware Group Dividend Reinvestment Plan and, under certain circumstances,
the Exchange Privilege and the 12-Month Reinvestment Privilege. See The
Delaware Difference and Redemption and Exchange for additional information.

Purchases of Class A Shares may be made at net asset value by current
and former officers, directors and employees (and members of their families) of
the Manager, any affiliate, any of the funds in the Delaware Group, certain of
their agents and registered representatives and employees of authorized
investment dealers and by employee benefit plans for such entities. Individual
purchases, including those in retirement accounts, must be for accounts in the
name of the individual or a qualifying family member.

Purchases of Class A Shares may also be made by clients of registered
representatives of an authorized investment dealer at net asset value within 12
months after the registered representative changes employment, if the purchase
is funded by proceeds from an investment where a front-end sales charge,
contingent deferred sales charge or other sales charge has been assessed.
Purchases of Class A Shares may also be made at net asset value by bank
employees who provide services in connection with agreements between the bank
and unaffiliated brokers or dealers concerning sales of shares of Delaware
Group funds. Officers, directors and key employees of institutional clients of
the Manager or any of its affiliates may purchase Class A Shares at net asset
value. Moreover, purchases may be effected at net asset value for the benefit
of the clients of brokers, dealers and registered investment advisers
affiliated with a broker or dealer, if such broker, dealer or investment
adviser has entered into an agreement with the Distributor providing
specifically for the purchase of Class A Shares in connection with special
investment products, such as wrap accounts or similar fee based programs.

Investments in Class A Shares made by plan level and/or participant
retirement accounts that are for the purpose of repaying a loan taken from such
accounts will be made at net asset value. Loan repayments made to a Delaware
Group account in connection with loans originated from accounts previously
maintained by another investment firm will also be invested at net asset value.

The Fund must be notified in advance that an investment qualifies for
purchase at net asset value.

-28-
<PAGE> 35
GROUP INVESTMENT PLANS

Group Investment Plans (e.g., SEP/IRA, SAR/SEP, Prototype Profit
Sharing, Pension and 401(k) Defined Contribution Plans) may benefit from the
reduced front-end sales charges available on the Class A Shares set forth in
the table on page 26, based on total plan assets. In addition, 403(b)(7) and
457 Retirement Plan Accounts may benefit from a reduced front-end sales charge
on Class A Shares based on the total amount invested by all participants in the
plan by satisfying the following criteria: (i) the employer for which the plan
was established has 250 or more eligible employees and the plan lists only one
broker of record, or (ii) the plan includes employer contributions and the plan
lists only one broker of record. If a company has more than one plan investing
in the Delaware Group of funds, then the total amount invested in all plans
will be aggregated to determine the applicable front-end sales charge reduction
on each purchase, both initial and subsequent, if, at the time of each such
purchase, the company notifies the Fund that it qualifies for the reduction.
Employees participating in such Group Investment Plans may also combine the
investments held in their plan account to determine the front-end sales charge
applicable to purchases in non-retirement Delaware Group investment accounts
if, at the time of each such purchase, they notify the Fund that they are
eligible to combine purchase amounts held in their plan account.

For additional information on retirement plans, including plan forms,
applications, minimum investments and any applicable account maintenance fees,
contact your investment dealer or the Distributor.

For other retirement plans and special services, see Retirement
Planning.

DEFERRED SALES CHARGE ALTERNATIVE - CLASS B SHARES

Class B Shares may be purchased at net asset value without a front-end
sales charge and, as a result, the full amount of the investor's purchase
payment will be invested in Fund shares. The Distributor currently anticipates
compensating dealers or brokers for selling Class B Shares at the time of
purchase from its own assets in an amount equal to no more than 4% of the
dollar amount purchased. In addition, from time to time, upon written notice
to all of its dealers, the Distributor may hold special promotions for
specified periods during which the Distributor may pay additional compensation
to dealers or brokers for selling Class B Shares at the time of purchase. As
discussed below, however, absent any applicable fee waiver, Class B Shares are
subject to annual 12b-1 Plan expenses and, if redeemed within six years of
purchase, a CDSC.

Proceeds from the CDSC and the annual 12b-1 Plan fees, if any, are
paid to the Distributor and others for providing distribution and related
services, and bearing related expenses, in connection with the sale of Class B
Shares. These payments support the compensation paid to dealers or brokers for
selling Class B Shares. Payments to the Distributor and others under the Class
B 12b-1 Plan may be in an amount equal to no more than 1% annually. The
combination of the CDSC and the proceeds of the 12b-1 Plan fees makes it
possible for the Fund to sell Class B Shares without deducting a front-end
sales charge at the time of purchase.

Holders of Class B Shares who exercise the exchange privilege
described below will continue to be subject to the CDSC schedule for the Class
B Shares described in this Prospectus, even after the exchange. Such CDSC
schedule may be higher than the CDSC schedule for the Class B Shares acquired
as a result of the exchange. See Redemption and Exchange.

-29-
<PAGE> 36
AUTOMATIC CONVERSION OF CLASS B SHARES
Class B Shares, other than shares acquired through reinvestment of
dividends, held for eight years after purchase are eligible for automatic
conversion into Class A Shares. Conversions of Class B Shares into Class A
Shares will occur only four times in any calendar year, on the last business
day of the second full week of March, June, September and December (each, a
"Conversion Date"). If the eighth anniversary after a purchase of Class B
Shares falls on a Conversion Date, an investor's Class B Shares will be
converted on that date. If the eighth anniversary occurs between Conversion
Dates, an investor's Class B Shares will be converted on the next Conversion
Date after such anniversary. Consequently, if a shareholder's eighth
anniversary falls on the day after a Conversion Date, that shareholder will
have to hold Class B Shares for as long as three additional months after the
eighth anniversary of purchase before the shares will automatically convert
into Class A Shares.

Class B Shares of a fund acquired through a reinvestment of dividends
will convert to the corresponding Class A Shares of that fund (or, in the case
of Delaware Group Cash Reserve, Inc., the Delaware Cash Reserve Consultant
Class) pro-rata with Class B Shares of that fund not acquired through dividend
reinvestment.

All such automatic conversions of Class B Shares will constitute
tax-free exchanges for federal income tax purposes. See Taxes.

LEVEL SALES CHARGE ALTERNATIVE - CLASS C SHARES

Class C Shares may be purchased at net asset value without a front-end
sales charge and, as a result, the Fund will invest the full amount of the
investor's purchase payment. The Distributor currently anticipates
compensating dealers or brokers for selling Class C Shares at the time of
purchase from its own assets in an amount equal to no more than 1% of the
dollar amount purchased. As discussed below, however, absent any applicable
fee waiver, Class C Shares are subject to annual 12b-1 Plan expenses and, if
redeemed within 12 months of purchase, a CDSC.

Proceeds from the CDSC and the annual 12b-1 Plan fees, if any, are
paid to the Distributor and others for providing distribution and related
services, and bearing related expenses, in connection with the sale of Class C
Shares. These payments support the compensation paid to dealers or brokers for
selling Class C Shares. Payments to the Distributor and others under the Class
C 12b-1 Plan may be in an amount equal to no more than 1% annually.

Holders of Class C Shares who exercise the exchange privilege
described below will continue to be subject to the CDSC schedule for the Class
C Shares as described in this Prospectus. See Redemption and Exchange.

CONTINGENT DEFERRED SALES CHARGE - CLASS B SHARES AND CLASS C SHARES
Class B Shares redeemed within six years of purchase may be subject to
a CDSC at the rates set forth below and Class C Shares redeemed within 12
months of purchase may be subject to a CDSC of 1%. CDSCs are charged as a
percentage of the dollar amount subject to the CDSC. The charge will be
assessed on an amount equal to the lesser of the net asset value at the time of
purchase of the shares being redeemed or the net asset value of those shares at
the time of redemption. No CDSC will be imposed on increases in net asset
value above the initial purchase price, nor will a CDSC be assessed on
redemptions

-30-
<PAGE> 37
of shares acquired through reinvestments of dividends or capital gains
distributions. For purposes of this formula, the "net asset value at the time
of purchase" will be the net asset value at purchase of the Class B Shares or
the Class C Shares of the Fund, even if those shares are later exchanged for
shares of another Delaware Group fund. In the event of an exchange of the
shares, the "net asset value of such shares at the time of redemption" will be
the net asset value of the shares that were acquired in the exchange.

The following table sets forth the rates of the CDSC for the Class B
Shares of the Fund:

<TABLE>
<CAPTION>
CONTINGENT DEFERRED
SALES CHARGE (AS A
PERCENTAGE OF
DOLLAR AMOUNT
YEAR AFTER PURCHASE MADE SUBJECT TO CHARGE)
------------------------ ------------------
<S> <C>
0-2 4%
3-4 3%
5 2%
6 1%
7 and thereafter None
</TABLE>

During the seventh year after purchase and, thereafter, until converted
automatically into Class A Shares, Class B Shares will still be subject to the
annual 12b-1 Plan expenses of up to 1% of average daily net assets of those
shares, absent any applicable fee waiver. See Automatic Conversion of Class B
Shares, above. Investors are reminded that the Class A Shares into which the
Class B Shares will convert are subject to ongoing annual 12b-1 Plan expenses
of up to a maximum of 0.30% of average daily net assets of such shares.

In determining whether a CDSC applies to a redemption of Class B
Shares, it will be assumed that shares held for more than six years are
redeemed first, followed by shares acquired through the reinvestment of
dividends or distributions, and finally by shares held longest during the
six-year period. With respect to Class C Shares, it will be assumed that
shares held for more than 12 months are redeemed first followed by shares
acquired through the reinvestment of dividends or distributions, and finally by
shares held for 12 months or less.

All investments made during a calendar month, regardless of what day
of the month the investment occurred, will age one month on the last day of
that month and each subsequent month.

The CDSC is waived on certain redemptions of Class B Shares and Class
C Shares. See Waiver of Contingent Deferred Sales Charge - Class B Shares and
Class C Shares under Redemption and Exchange.

OTHER PAYMENTS TO DEALERS -- CLASS A, CLASS B AND CLASS C SHARES
From time to time at the discretion of the Distributor, all registered
broker/dealers whose aggregate sales of the Classes exceed certain limits, as
set by the Distributor, may receive from the Distributor an additional payment
of up to 0.25% of the dollar amount of such sales. The Distributor may also
provide additional promotional incentives or payments to dealers that sell
shares of the Delaware Group of funds. In some instances, these incentives or
payments may be offered only to certain dealers who maintain, have sold or may
sell certain amounts of shares.

-31-
<PAGE> 38
Subject to pending amendments to the NASD's Rules of Fair Practice, in
connection with the promotion of Delaware Group fund shares, the Distributor
may, from time to time, pay to participate in dealer-sponsored seminars and
conferences, reimburse dealers for expenses incurred in connection with
preapproved seminars, conferences and advertising and may, from time to time,
pay or allow additional promotional incentives to dealers, which shall include
non-cash concessions, such as certain luxury merchandise or a trip to or
attendance at a business or investment seminar at a luxury resort, as part of
preapproved sales contests. Payment of non-cash compensation to dealers is
currently under review by the NASD and the Securities and Exchange Commission.
It is likely that the NASD's Rules of Fair Practice will be amended such that
the ability of the Distributor to pay non-cash compensation as described above
will be restricted in some fashion. The Distributor intends to comply with the
NASD's Rules of Fair Practice as they may be amended.

RETIREMENT INCOME FUND INSTITUTIONAL CLASS
In addition to offering the Class A, Class B and Class C Shares, the
Fund also offers the Retirement Income Fund Institutional Class, which is
described in a separate prospectus and is available for purchase only by
certain investors. Retirement Income Fund Institutional Class shares generally
are distributed directly by the Distributor and do not have a front-end sales
charge, a CDSC or a Limited CDSC, and are not subject to 12b-1 Plan
distribution expenses. To obtain the prospectus that describes the Retirement
Income Fund Institutional Class, contact the Distributor by writing to the
address or by calling the telephone number listed on the back of this
Prospectus.

-32-
<PAGE> 39
HOW TO BUY SHARES

PURCHASE AMOUNTS
Generally, the minimum initial purchase is $1,000 for Class A Shares,
Class B Shares and Class C Shares. Subsequent purchases of shares of any Class
generally must be $100 or more. For purchases under a Uniform Gifts to Minors
Act or Uniform Transfers to Minors Act or through an Automatic Investing Plan,
there is a minimum initial purchase of $250 and a minimum subsequent purchase
of $25. Minimum purchase requirements do not apply to retirement plans other
than IRAs, for which there is a minimum initial purchase of $250, and a minimum
subsequent purchase of $25, regardless of which Class is selected.

There is a maximum purchase limitation of $250,000 on each purchase of
Class B Shares. For Class C Shares, each purchase must be in an amount that is
less than $1,000,000. An investor may exceed these maximum purchase
limitations by making cumulative purchases over a period of time. In doing so,
an investor should keep in mind that reduced front-end sales charges are
available on investments of $100,000 or more in Class A Shares, and that Class
A Shares (i) are subject to lower annual 12b-1 Plan expenses than Class B
Shares and Class C Shares and (ii) generally are not subject to a CDSC. For
retirement plans, the maximum purchase limitations apply only to the initial
purchase of Class B Shares or Class C Shares by the plan.

INVESTING THROUGH YOUR INVESTMENT DEALER
You can make a purchase of shares of the Fund through most investment
dealers who, as part of the service they provide, must transmit orders
promptly. They may charge for this service. If you want a dealer but do not
have one, we can refer you to one.

INVESTING BY MAIL
1. Initial Purchases--An Investment Application or, in the case of a
retirement account, an appropriate retirement plan application, must be
completed, signed and sent with a check payable to Retirement Income Fund A
Class, Retirement Income Fund B Class or Retirement Income Fund C Class, to
Delaware Group at 1818 Market Street, Philadelphia, PA 19103.

2. Subsequent Purchases--Additional purchases may be made at any time by
mailing a check payable to the specific Fund and Class selected. Your check
should be identified with your name(s) and account number. An investment slip
(similar to a deposit slip) is provided at the bottom of transaction
confirmations and dividend statements that you will receive from Equity Funds
V, Inc. Use of this investment slip can help expedite processing of your check
when making additional purchases. Your investment may be delayed if you send
additional purchases by certified mail.

INVESTING BY WIRE
You may purchase shares by requesting your bank to transmit funds by
wire to CoreStates Bank, N.A., ABA #031000011, account number 1412893401
(include your name(s) and your account number for the Class in which you are
investing).

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1. Initial Purchases--Before you invest, telephone the Shareholder
Service Center to get an account number. If you do not call first, processing
of your investment may be delayed. In addition, you must promptly send your
Investment Application or, in the case of a retirement account, an appropriate
retirement plan application, to the specific Fund and Class selected, to
Delaware Group at 1818 Market Street, Philadelphia, PA 19103.

2. Subsequent Purchases--You may make additional investments anytime by
wiring funds to CoreStates Bank, N.A., as described above. You should advise
the Shareholder Service Center by telephone of each wire you send.

If you want to wire investments to a retirement plan account, call the
Shareholder Service Center for special wiring instructions.

INVESTING BY EXCHANGE
If you have an investment in another mutual fund in the Delaware
Group, you may write and authorize an exchange of part or all of your
investment into shares of the Fund. If you wish to open an account by
exchange, call the Shareholder Service Center for more information. All
exchanges are subject to the eligibility and minimum purchase requirements set
forth in each fund's prospectus.

Holders of Class A Shares may exchange all or part of their shares for
certain of the shares of other funds in the Delaware Group, including other
Class A Shares, but may not exchange their Class A Shares for Class B Shares or
Class C Shares of the Fund or of any other fund in the Delaware Group. Holders
of Class B Shares of the Fund are permitted to exchange all or part of their
Class B Shares only into Class B Shares of other Delaware Group funds.
Similarly, holders of Class C Shares of the Fund are permitted to exchange all
or part of their Class C Shares only into Class C Shares of other Delaware
Group funds. See Appendix B--Retail Classes Offered for a list of funds that
offer Class A, Class B, Class C and Consultant Class Shares. Class B Shares of
the Fund and Class C Shares of the Fund acquired by exchange will continue to
carry the CDSC and, in the case of Class B Shares, the automatic conversion
schedule of the fund from which the exchange is made. The holding period of
Class B Shares of the Fund acquired by exchange will be added to that of the
shares that were exchanged for purposes of determining the time of the
automatic conversion into Class A Shares of the Fund.

Permissible exchanges into Class A Shares of the Fund will be made
without a front-end sales charge, except for exchanges of shares that were not
previously subject to a front-end sales charge (unless such shares were
acquired through the reinvestment of dividends). Permissible exchanges into
Class B Shares or Class C Shares of the Fund will be made without the
imposition of a CDSC by the fund from which the exchange is being made at the
time of the exchange.

See Allied Plans under Retirement Planning for information on
exchanges by participants in an Allied Plan.

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ADDITIONAL METHODS OF ADDING TO YOUR INVESTMENT
Call the Shareholder Service Center for more information if you wish
to use the following services:

1. Automatic Investing Plan
THE AUTOMATIC INVESTING PLAN ENABLES YOU TO MAKE REGULAR MONTHLY
INVESTMENTS WITHOUT WRITING OR MAILING CHECKS. You may authorize Equity Funds
V, Inc. to transfer a designated amount monthly from your checking account to
your account. Many shareholders use this as an automatic savings plan.
Shareholders should allow a reasonable amount of time for initial purchases and
changes to these plans to become effective.

This option is not available to participants in the following plans:
SAR/SEP, SEP/IRA, Profit Sharing and Money Purchase Pension Plans, 401(k)
Defined Contribution Plans, 403(b)(7) Deferred Compensation Plans or 457
Deferred Compensation Plans.

2. Direct Deposit
YOU MAY HAVE YOUR EMPLOYER OR BANK MAKE REGULAR INVESTMENTS DIRECTLY
TO YOUR FUND ACCOUNT FOR YOU (for example: payroll deduction, pay by phone,
annuity payments). The Fund also accepts preauthorized recurring government
and private payments by Electronic Fund Transfer, which avoids mail time and
check clearing holds on payments such as social security, federal salaries,
Railroad Retirement benefits, etc.

* * *

Should investments through an automatic investing plan or by direct
deposit be reclaimed or returned for some reason, Equity Funds V, Inc. has the
right to liquidate your shares to reimburse the government or transmitting
bank. If there are insufficient funds in your account, you are obligated to
reimburse the Fund.

3. Wealth Builder Option
You can use our Wealth Builder Option to invest in the Fund through
regular liquidations of shares in your accounts in other funds in the Delaware
Group. You may also elect to invest in other mutual funds in the Delaware
Group through the Wealth Builder Option through regular liquidations of shares
in your Fund account.

Under this automatic exchange program, you can authorize regular
monthly amounts (minimum of $100 per fund) to be liquidated from your account
in one or more funds in the Delaware Group and invested automatically into any
other Delaware Group account that you may specify. If in connection with the
election of the Wealth Builder Option, you wish to open a new account to
receive the automatic investment, such new account must meet the minimum
initial purchase requirements described in the prospectus of the fund that you
select. All investments under this option are exchanges and are therefore
subject to the same conditions and limitations as other exchanges noted above.
You can terminate your participation at any time by written notice to the fund
from which the exchanges are made. See Redemption and Exchange.

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This option is not available to participants in the following plans:
SAR/SEP, SEP/IRA, Profit Sharing and Money Purchase Pension Plans, 401(k)
Defined Contribution Plans, 403(b)(7) Deferred Compensation Plans or 457
Deferred Compensation Plans.

4. Dividend Reinvestment Plan
You can elect to have your distributions (capital gains and/or
dividend income) reinvested in your Fund account or invested in certain other
funds in the Delaware Group, subject to the exceptions noted below as well as
the eligibility and minimum purchase requirements set forth in each fund's
prospectus.

Reinvestments of distributions into Class A Shares of the Fund or of
other Delaware Group funds are made without a front-end sales charge.
Reinvestments of distributions into Class B Shares of the Fund or of other
Delaware Group funds or into Class C Shares of the Fund or of other Delaware
Group funds are also made without any sales charge and will not be subject to a
CDSC if later redeemed. See Automatic Conversion of Class B Shares under
Classes of Shares for information concerning the automatic conversion of Class
B Shares acquired by reinvesting dividends.

Holders of Class A Shares of the Fund may not reinvest their
distributions into Class B Shares or Class C Shares of any fund in the Delaware
Group, including the Fund. Holders of Class B Shares of the Fund may reinvest
their distributions only into Class B Shares of the funds in the Delaware Group
which offer that class of shares. Similarly, holders of Class C Shares of the
Fund may reinvest their distributions only into Class C Shares of the funds in
the Delaware Group which offer that class of shares. See Appendix B--Classes
Offered for a list of the funds offering those classes of shares. For more
information about reinvestments, call the Shareholder Service Center.

DELAWARE GROUP ASSET PLANNER
To invest in Delaware Group funds using the Delaware Group Asset
Planner asset allocation service, you should complete a Delaware Group Asset
Planner Account Registration Form, which is available only from a financial
adviser or investment dealer. As previously described, the Delaware Group
Asset Planner service offers a choice of four predesigned asset allocation
strategies (each with a different risk/reward profile) in predetermined
percentages in Delaware Group funds. Or, with the help of a financial adviser,
you may design a customized asset allocation strategy.

The sales charge on an investment through the Asset Planner service is
determined by the individual sales charges of the underlying funds and their
percentage allocation in the selected Strategy. Exchanges from existing
Delaware Group accounts into the Asset Planner service may be made at net asset
value under the circumstances described under Investing by Exchange, above.
The minimum initial investment per Strategy is $2,000; subsequent investments
must be at least $100. Individual fund minimums do not apply to investments
made using the Asset Planner service. Class A, Class B and Class C Shares are
available through the Asset Planner service. Generally, only shares within the
same class may be used within the same Strategy. However, Class A Shares of
the Fund and of other funds in the Delaware Group may be used in the same
Strategy with consultant class shares that are offered by certain other
Delaware Group funds. See Appendix B--Classes Offered for the Delaware Group
funds that offer consultant class shares.

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<PAGE> 43

An annual maintenance fee, currently $35 per Strategy, is typically
due at the time of initial investment and by September 30th of each subsequent
year. The fee, payable to Delaware Service Company, Inc. to defray extra costs
associated with administering the Asset Planner service, will be deducted
automatically from one of the funds within your Asset Planner account if not
paid by September 30th. However, the annual fee will be waived until further
notice. Investors who utilize the Asset Planner for an IRA will pay an annual
IRA fee of $15 per Social Security Number. See Part B.

Investors will receive a customized quarterly Strategy Report
summarizing all Delaware Group Asset Planner investment performance and account
activity during the prior period. Confirmation statements will be sent
following all transactions other than those involving a reinvestment of
distributions.

Certain shareholder services are not available to investors using the
Asset Planner service, due to its special design. These include Delaphone,
Checkwriting, Wealth Builder Option and Letter of Intention. Systematic
Withdrawal Plans are available after the account has been open for two years.

PURCHASE PRICE AND EFFECTIVE DATE
The offering price and net asset value of the Class A, Class B and
Class C Shares are determined as of the close of regular trading on the New
York Stock Exchange (ordinarily, 4 p.m., Eastern time) on days when the
Exchange is open.

The effective date of a purchase made through an investment dealer is
the date the order is received by the Fund. The effective date of a direct
purchase is the day your wire, electronic transfer or check is received unless
it is received after the time the offering price or net asset value of shares
is determined, as noted above. Purchase orders received after such time will
be effective the next business day.

THE CONDITIONS OF YOUR PURCHASE
The Fund reserves the right to reject any purchase order. If a
purchase is canceled because your check is returned unpaid, you are responsible
for any loss incurred. The Fund can redeem shares from your account(s) to
reimburse itself for any loss, and you may be restricted from making future
purchases in any of the funds in the Delaware Group. The Fund reserves the
right to reject purchase orders paid by third-party checks or checks that are
not drawn on a domestic branch of a United States financial institution. If a
check drawn on a foreign financial institution is accepted, you may be subject
to additional bank charges for clearance and currency conversion.

The Fund also reserves the right, following shareholder notification,
to charge a service fee on non-retirement accounts that, as a result of a
redemption, have remained below the minimum stated account balance for a period
of three or more consecutive months. Holders of such accounts may be notified
of their insufficient account balance and advised that they have until the end
of the current calendar quarter to raise their balance to the stated minimum.
If the account has not reached the minimum balance requirement by that time,
the Fund will charge a $9 fee for that quarter and each subsequent calendar
quarter until the account is brought up to the minimum balance. The service
fee will be deducted from the account during the first week of each calendar
quarter for the previous quarter, and will be used to help defray the cost of
maintaining low-balance accounts. No fees will be charged without proper
notice, and no CDSC will apply to such assessments.

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The Fund also reserves the right, upon 60 days' written notice, to
involuntarily redeem accounts that remain under the minimum initial purchase
amount as a result of redemptions. An investor making the minimum initial
investment may be subject to involuntary redemption without the imposition of a
CDSC or Limited CDSC if he or she redeems any portion of his or her account.

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<PAGE> 45
REDEMPTION AND EXCHANGE

YOU CAN REDEEM OR EXCHANGE YOUR SHARES IN A NUMBER OF DIFFERENT WAYS.
The exchange service is useful if your investment requirements change and you
want an easy way to invest in other equity funds, bond funds, tax-advantaged
funds or money market funds. This service is also useful if you are
anticipating a major expenditure and want to move a portion of your investment
into a fund that has the checkwriting feature. Exchanges are subject to the
requirements of each fund and all exchanges of shares constitute taxable
events. See Taxes. Further, in order for an exchange to be processed, shares
of the fund being acquired must be registered in the state where the acquiring
shareholder resides. You may want to consult your financial adviser or
investment dealer to discuss which funds in the Delaware Group will best meet
your changing objectives, and the consequences of any exchange transaction.
You may also call the Delaware Group directly for fund information.

Your shares will be redeemed or exchanged at a price based on the net
asset value next determined after the Fund receives your request in good order,
subject, in the case of a redemption, to any applicable CDSC or Limited CDSC.
Redemption or exchange requests received in good order after the time the
offering price and net asset value of shares are determined, as noted above,
will be processed on the next business day. See Purchase Price and Effective
Date under How to Buy Shares. A shareholder submitting a redemption request
may indicate that he or she wishes to receive redemption proceeds of a specific
dollar amount. In the case of such a request, and in the case of certain
redemptions from retirement plan accounts, the Fund will redeem the number of
shares necessary to deduct the applicable CDSC in the case of Class B and Class
C Shares, and, if applicable, the Limited CDSC in the case of Class A Shares
and tender to the shareholder the requested amount, assuming the shareholder
holds enough shares in his or her account for the redemption to be processed in
this manner. Otherwise, the amount tendered to the shareholder upon redemption
will be reduced by the amount of the applicable CDSC or Limited CDSC.
Redemption proceeds will be distributed promptly, as described below, but not
later than seven days after receipt of a redemption request.

Except as noted below, for a redemption request to be in "good order,"
you must provide your account number, account registration, and the total
number of shares or dollar amount of the transaction. For exchange requests,
you must also provide the name of the fund you want to receive the proceeds.
Exchange instructions and redemption requests must be signed by the record
owner(s) exactly as the shares are registered. You may request a redemption or
an exchange by calling the Shareholder Service Center at 800-523-1918. The
Fund may suspend, terminate, or amend the terms of the exchange privilege upon
60 days' written notice to shareholders.

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<PAGE> 46
You can avoid this potential delay if you purchase shares by wiring Federal
Funds. The Fund reserves the right to reject a written or telephone redemption
request or delay payment of redemption proceeds if there has been a recent
change to the shareholder's address of record.

There is no front-end sales charge or fee for exchanges made between
shares of funds which both carry a front-end sales charge. Any applicable
front-end sales charge will apply to exchanges from shares of funds not subject
to a front-end sales charge, except for exchanges involving assets that were
previously invested in a fund with a front-end sales charge and/or exchanges
involving the reinvestment of dividends.

Holders of Class B Shares or Class C Shares that exchange their shares
("Original Shares") for shares of other funds in the Delaware Group (in each
case, "New Shares") in a permitted exchange, will not be subject to a CDSC that
might otherwise be due upon redemption of the Original Shares. However, such
shareholders will continue to be subject to the CDSC and, in the case of Class
B Shares, the automatic conversion schedule of the Original Shares as described
in this Prospectus and any CDSC assessed upon redemption will be charged by the
Fund from which the Original Shares were exchanged. In an exchange of Class B
Shares from the Fund, the Fund's CDSC schedule may be higher than the CDSC
schedule relating to the New Shares acquired as a result of the exchange. For
purposes of computing the CDSC that may be payable upon a disposition of the
New Shares, the period of time that an investor held the Original Shares is
added to the period of time that an investor held the New Shares. With respect
to Class B Shares, the automatic conversion schedule of the Original Shares may
be longer than that of the New Shares. Consequently, an investment in New
Shares by exchange may subject an investor, absent any applicable fee waiver,
to the higher 12b-1 fees applicable to Class B Shares of the Fund for a longer
period of time than if the investment in New Shares were made directly.

Various redemption and exchange methods are outlined below. Except
for the CDSC applicable to certain redemptions of Class B and Class C Shares
and the Limited CDSC applicable to certain redemptions of Class A Shares
purchased at net asset value, there is no fee charged by the Fund or the
Distributor for redeeming or exchanging your shares, but such fees could be
charged in the future. You may have your investment dealer arrange to have
your shares redeemed or exchanged. Your investment dealer may charge for this
service.

All authorizations given by shareholders, including selection of any
of the features described below, shall continue in effect until such time as a
written revocation or modification has been received by the Fund or its agent.

WRITTEN REDEMPTION
You can write to the Fund at 1818 Market Street, Philadelphia, PA
19103 to redeem some or all of your shares. The request must be signed by all
owners of the account or your investment dealer of record. For redemptions of
more than $50,000, or when the proceeds are not sent to the shareholder(s) at
the address of record, the Fund requires a signature by all owners of the
account and a signature guarantee for each owner. Each signature guarantee
must be supplied by an eligible guarantor institution. The Fund reserves the
right to reject a signature guarantee supplied by an eligible institution based
on its creditworthiness. The Fund may require further documentation from
corporations, executors, retirement plans, administrators, trustees or
guardians.

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Payment is normally mailed the next business day after receipt of your
redemption request. If your Class A Shares are in certificate form, the
certificate must accompany your request and also be in good order.
Certificates are issued for Class A Shares only if a shareholder submits a
specific request. Certificates are not issued for Class B Shares or Class C
Shares.

WRITTEN EXCHANGE
You may also write to the Fund (at 1818 Market Street, Philadelphia,
PA 19103) to request an exchange of any or all of your shares into another
mutual fund in the Delaware Group, subject to the same conditions and
limitations as other exchanges noted above.

TELEPHONE REDEMPTION AND EXCHANGE
To get the added convenience of the telephone redemption and exchange
methods, you must have the Transfer Agent hold your shares (without charge) for
you. If you choose to have your Class A Shares in certificate form, you may
redeem or exchange only by written request and you must return your
certificates.

The Telephone Redemption--Check to Your Address of Record service and
the Telephone Exchange service, both of which are described below, are
automatically provided unless you notify the Fund in writing that you do not
wish to have such services available with respect to your account. The Fund
reserves the right to modify, terminate or suspend these procedures upon 60
days' written notice to shareholders. It may be difficult to reach the Fund by
telephone during periods when market or economic conditions lead to an
unusually large volume of telephone requests.

Neither the Fund nor its Transfer Agent is responsible for any
shareholder loss incurred in acting upon written or telephone instructions for
redemption or exchange of Fund shares which are reasonably believed to be
genuine. With respect to such telephone transactions, the Fund will follow
reasonable procedures to confirm that instructions communicated by telephone
are genuine (including verification of a form of personal identification) as,
if it does not, the Fund or the Transfer Agent may be liable for any losses due
to unauthorized or fraudulent transactions. Instructions received by telephone
are generally tape recorded, and a written confirmation will be provided for
all purchase, exchange and redemption transactions initiated by telephone. By
exchanging shares by telephone, you are acknowledging prior receipt of a
prospectus for the fund into which your shares are being exchanged.

TELEPHONE REDEMPTION--CHECK TO YOUR ADDRESS OF RECORD
THE TELEPHONE REDEMPTION FEATURE IS A QUICK AND EASY METHOD TO REDEEM
SHARES. You or your investment dealer of record can have redemption proceeds
of $50,000 or less mailed to you at your address of record. Checks will be
payable to the shareholder(s) of record. Payment is normally mailed the next
business day after receipt of the request. This service is only available to
individual, joint and individual fiduciary-type accounts.

TELEPHONE REDEMPTION--PROCEEDS TO YOUR BANK
Redemption proceeds of $1,000 or more can be transferred to your
predesignated bank account by wire or by check. You should authorize this
service when you open your account. If you change your predesignated bank
account, you must complete an Authorization Form and have your signature
guaranteed. For your protection, your authorization must be on file. If you
request a wire, your funds will normally be sent the next business day.
CoreStates Bank, N.A.'s fee (currently $7.50) will be

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deducted from your redemption. If you ask for a check, it will normally be
mailed the next business day after receipt of your request to your
predesignated bank account. There are no separate fees for this redemption
method, but the mail time may delay getting funds into your bank account.
Simply call the Shareholder Service Center prior to the time the offering price
and net asset value are determined, as noted above.

TELEPHONE EXCHANGE
The Telephone Exchange feature is a convenient and efficient way to
adjust your investment holdings as your liquidity requirements and investment
objectives change. You or your investment dealer of record can exchange your
shares into other funds in the Delaware Group under the same registration,
subject to the same conditions and limitations as other exchanges noted above.
As with the written exchange service, telephone exchanges are subject to the
requirements of each fund, as described above. Telephone exchanges may be
subject to limitations as to amounts or frequency.

CONTINGENT DEFERRED SALES CHARGE FOR CERTAIN REDEMPTIONS OF CLASS A SHARES
PURCHASED AT NET ASSET VALUE
A Limited CDSC will be imposed on certain redemptions of Class A Shares
(or shares into which such Class A Shares are exchanged) made within 12 months
of purchase, if such purchases were made at net asset value and triggered the
payment by the Distributor of the dealer's commission previously described. See
Classes of Shares.

The Limited CDSC will be paid to the Distributor and will be equal to
the lesser of 1% of: (1) the net asset value at the time of purchase of the
Class A Shares being redeemed; or (2) the net asset value of such Class A
Shares at the time of redemption. For purposes of this formula, the "net asset
value at the time of purchase" will be the net asset value at purchase of the
Class A Shares even if those shares are later exchanged for shares of another
Delaware Group fund and, in the event of an exchange of Class A Shares, the
"net asset value of such shares at the time of redemption" will be the net
asset value of the shares acquired in the exchange.

Redemptions of such Class A Shares held for more than 12 months will
not be subjected to the Limited CDSC and an exchange of such Class A Shares
into another Delaware Group fund will not trigger the imposition of the Limited
CDSC at the time of such exchange. The period a shareholder owns shares into
which Class A Shares are exchanged will count towards satisfying the 12-month
holding period. The Limited CDSC is assessed if such 12-month period is not
satisfied irrespective of whether the redemption triggering its payment is of
Class A Shares of the Fund or Class A Shares acquired in the exchange.

In determining whether a Limited CDSC is payable, it will be assumed
that shares not subject to the Limited CDSC are the first redeemed followed by
other shares held for the longest period of time. The Limited CDSC will not be
imposed upon shares representing reinvested dividends or capital gains
distributions, or upon amounts representing share appreciation. All
investments made during a calendar month, regardless of what day of the month
the investment occurred, will age one month on the last day of that month and
each subsequent month.

WAIVER OF LIMITED CONTINGENT DEFERRED SALES CHARGE - CLASS A SHARES
The Limited CDSC for Class A Shares on which a dealer's commission has
been paid will be waived in the following instances: (i) redemptions that
result from the Fund's right to liquidate a

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shareholder's account if the aggregate net asset value of the shares held in
the account is less than the then-effective minimum account size; (ii)
distributions to participants from a retirement plan qualified under section
401(a) or 401(k) of the Internal Revenue Code of 1986, as amended (the "Code"),
or due to death of a participant in such a plan; (iii) redemptions pursuant to
the direction of a participant or beneficiary of a retirement plan qualified
under section 401(a) or 401(k) of the Code with respect to that retirement
plan; (iv) distributions from a section 403(b)(7) Plan or an IRA due to death,
disability, or attainment of age 59 1/2; (v) returns of excess contributions to
an IRA; (vi) distributions by other employee benefit plans to pay benefits;
(vii) distributions described in (ii), (iv), and (vi) above pursuant to a
systematic withdrawal plan; and (viii) redemptions by the classes of
shareholders who are permitted to purchase shares at net asset value,
regardless of the size of the purchase (see Buying Class A Shares at Net Asset
Value under Classes of Shares).

WAIVER OF CONTINGENT DEFERRED SALES CHARGE - CLASS B AND CLASS C SHARES
The CDSC is waived on certain redemptions of Class B Shares in
connection with the following redemptions: (i) redemptions that result from
the Fund's right to liquidate a shareholder's account if the aggregate net
asset value of the shares held in the account is less than the then-effective
minimum account size; (ii) returns of excess contributions to an IRA or
403(b)(7) Deferred Compensation Plan; (iii) required minimum distributions from
an IRA, 403(b)(7) Deferred Compensation Plan or 457 Deferred Compensation Plan;
and (iv) distributions from an account if the redemption results from the death
of all registered owners of the account (in the case of accounts established
under the Uniform Gifts to Minors or Uniform Transfers to Minors Acts or trust
accounts, the waiver applies upon the death of all beneficial owners) or a
total and permanent disability (as defined in Section 72 of the Code) of all
registered owners occurring after the purchase of the shares being redeemed.

The CDSC on Class C Shares is waived in connection with the following
redemptions: (i) redemptions that result from the Fund's right to liquidate a
shareholder's account if the aggregate net asset value of the shares held in
the account is less than the then-effective minimum account size; (ii) returns
of excess contributions to an IRA, 403(b)(7) Deferred Compensation Plan, Profit
Sharing Plan, Money Purchase Pension Plan or 401(k) Defined Contribution Plan;
(iii) required minimum distributions from an IRA, 403(b)(7) Deferred
Compensation Plan, 457 Deferred Compensation Plan, Profit Sharing Plan, Money
Purchase Pension Plan or 401(k) Defined Contribution Plan; (iv) distributions
from a 403(b)(7) Deferred Compensation Plan, 457 Deferred Compensation Plan,
Profit Sharing Plan, or 401(k) Defined Contribution Plan, under hardship
provisions of the plan; (v) distributions from a 403(b)(7) Deferred
Compensation Plan, 457 Deferred Compensation Plan, Profit Sharing Plan, Money
Purchase Pension Plan or a 401(k) Defined Contribution Plan upon attainment of
normal retirement age under the plan or upon separation from service; (vi)
distributions from an IRA on or after attainment of age 59 1/2; and (vii)
distributions from an account if the redemption results from the death of all
registered owners of the account (in the case of accounts established under the
Uniform Gifts to Minors or Uniform Transfers to Minors Acts or trust accounts,
the waiver applies upon the death of all beneficial owners) or a total and
permanent disability (as defined in Section 72 of the Code) of all registered
owners occurring after the purchase of the shares being redeemed.

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DIVIDENDS AND DISTRIBUTIONS

The Fund expects to declare and pay dividends monthly. However, the
Fund does not anticipate declaring or paying dividends during the first few
months following the commencement of its operations. Both dividends and
distributions, if any, are automatically reinvested in your account at net
asset value unless you elect to have them reinvested in shares of another
Delaware Group fund. Distributions from net realized securities profits, if
any, will be distributed twice a year. The first payment normally would be
made during the first quarter of the next fiscal year. The second payment
would be made near the end of the calendar year to comply with certain
requirements of the Internal Revenue Code (the "Code").

Each Class of the Fund will share proportionately in the investment
income and expenses of the Fund, except that, absent any applicable fee waiver,
the per share dividends from net investment income on the Class A Shares, the
Class B Shares and the Class C Shares will vary due to the expenses under the
12b-1 Plan applicable to each Class. Generally, except in the absence of a fee
waiver, the dividends per share on Class B Shares and Class C Shares can be
expected to be lower than the dividends per share on Class A Shares because the
expenses under the 12b-1 Plans relating to Class B and Class C Shares will be
higher than the expenses under the 12b-1 Plan relating to Class A Shares. See
Distribution (12b-1) and Service under Management of the Fund.

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TAXES

The tax discussion set forth below is included for general information
only. Investors should consult their own tax advisers concerning the federal,
state, local or foreign tax consequences of an investment in the Fund.

The Fund intends to qualify as a regulated investment company under
Subchapter M of the Code. As such, the Fund will not be subject to federal
income tax, or to any excise tax, to the extent its earnings are distributed as
provided in the Code.

The Fund intends to distribute substantially all of its net investment
income and net capital gains, if any. Dividends from net investment income or
net short-term capital gains will be taxable to those investors who are subject
to income taxes as ordinary income, whether received in cash or in additional
shares. It is expected that only a nominal portion of the Fund's dividends
will be eligible for the dividends-received deduction for corporations.

Distributions paid by the Fund from long-term capital gains, whether
received in cash or in additional shares, are taxable to those investors who
are subject to income taxes as long-term capital gains, regardless of the
length of time an investor has owned shares in the Fund. The Fund does not
seek to realize any particular amount of capital gains during a year; rather,
realized gains are a byproduct of Fund management activities. Consequently,
capital gains distributions may be expected to vary considerably from year to
year. Also, for those investors subject to tax, if purchases of shares in the
Fund are made shortly before the record date for a dividend or capital gains
distribution, a portion of the investment will be returned as a taxable
distribution.

Although dividends generally will be treated as distributed when paid,
dividends which are declared in October, November or December to shareholders
of record on a specified date in one of those months, but which, for
operational reasons, may not be paid to the shareholder until the following
January, will be treated for tax purposes as if paid by the Fund and received
by the shareholder on December 31 of the calendar year in which they are
declared.

The sale of shares of the Fund is a taxable event and may result in a
capital gain or loss to shareholders subject to tax. Capital gain or loss may
be realized from an ordinary redemption of shares or an exchange of shares
between the Fund and any other fund in the Delaware Group. Any loss incurred
on a sale or exchange of Fund shares that had been held for six months or less
will be treated as a long-term capital loss to the extent of capital gain
dividends received with respect to such shares. All or a portion of the sales
charge incurred in acquiring Fund shares will be excluded from the federal tax
basis of any of such shares sold or exchanged within 90 days of their purchase
(for purposes of determining gain or loss upon the sale of such shares) if the
sale proceeds are reinvested in the Fund or in another fund in the Delaware
Group of funds and a sales charge that would otherwise apply to the
reinvestment is reduced or eliminated. Any portion of such sales charge
excluded from the tax basis of the shares sold will be added to the tax basis
of the shares acquired in the reinvestment.

The automatic conversion of Class B Shares into Class A Shares at the
end of approximately eight years after purchase will be tax-free for federal
tax purposes. See Automatic Conversion of Class B Shares under Classes of
Shares.

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The Fund may be subject to foreign withholding taxes on income from
certain of its foreign securities.

In addition to federal taxes, shareholders may be subject to state and
local taxes on distributions. Distributions of interest income and capital
gains realized from certain types of U.S. government securities may be exempt
from state personal income taxes. Shares of the Fund are exempt from
Pennsylvania county personal property taxes.

Each year, Equity Funds V, Inc. will mail to you information on the
tax status of the Fund's dividends and distributions. Shareholders will also
receive each year information as to the portion of dividend income that is
derived from U.S. government securities that are exempt from state income tax.
Of course, shareholders who are not subject to tax on their income would not be
required to pay tax on amounts distributed to them by the Fund.

The Fund is required to withhold 31% of taxable dividends, capital
gains distributions, and redemptions paid to shareholders who have not complied
with IRS taxpayer identification regulations. You may avoid this withholding
requirement by certifying on your Investment Application your proper Taxpayer
Identification Number and by certifying that you are not subject to backup
withholding.

See Taxes in Part B for additional information on tax matters relating
to the Fund and its shareholders.

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CALCULATION OF OFFERING PRICE AND NET ASSET VALUE PER SHARE

The net asset value ("NAV") per share is computed by adding the value
of all securities and other assets in the portfolio, deducting any liabilities
(expenses and fees are accrued daily) and dividing by the number of shares
outstanding. Equity securities for which market quotations are available are
priced at market value. Foreign securities expressed in foreign currency
values will be converted into U.S. dollar values at the mean between the
currencies' bid and offered quotations. Debt securities are priced at fair
value by an independent pricing service using methods approved by Equity Funds
V, Inc.'s Board of Directors. Short-term investments having a maturity of less
than 60 days are valued at amortized cost, which approximates market value.
All other securities are valued at their fair value as determined in good faith
and in a method approved by Equity Funds V, Inc.'s Board of Directors.

Class A Shares are purchased at the offering price per share, while
Class B Shares and Class C Shares are purchased at the NAV per share. The
offering price per share of Class A Shares consists of the NAV per share next
computed after the order is received, plus any applicable front-end sales
charges.

The offering price and NAV are computed as of the close of regular
trading on the New York Stock Exchange (ordinarily, 4 p.m., Eastern time) on
days when the Exchange is open.

The net asset values of all outstanding shares of each class of the
Fund will be computed on a pro-rata basis for each outstanding share based on
the proportionate participation in the Fund represented by the value of shares
of that class. All income earned and expenses incurred by the Fund will be
borne on a pro-rata basis by each outstanding share of a class, based on each
class' percentage in the Fund represented by the value of shares of such
classes, except that the Retirement Income Fund Institutional Class will not
incur any of the expenses under the Fund's 12b-1 Plans and the Class A, Class B
and Class C Shares alone will bear the 12b-1 Plan expenses, if any, payable
under their respective Plans.

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MANAGEMENT OF THE FUND

DIRECTORS

The business and affairs of Equity Funds V, Inc. are managed under the
direction of its Board of Directors. Part B contains additional information
regarding Equity Funds V, Inc.'s directors and officers.

INVESTMENT MANAGER
The Manager furnishes investment management services to the Fund.

The Manager and its predecessors have been managing the funds in the
Delaware Group since 1938. On September 30, 1996, the Manager and its
affiliates in the Delaware Group, including Delaware International Advisers
Ltd., were supervising in the aggregate more than $30 billion in assets in the
various institutional or separately managed (approximately $18,573,058,000) and
investment company (approximately $11,495,414,000) accounts.

The Manager is an indirect, wholly owned subsidiary of Delaware
Management Holdings, Inc. ("DMH"). On April 3, 1995, a merger between DMH and
a wholly owned subsidiary of Lincoln National Corporation ("Lincoln National")
was completed. DMH and the Manager are now indirect, wholly owned
subsidiaries, and subject to the ultimate control, of Lincoln National.
Lincoln National, with headquarters in Fort Wayne, Indiana, is a diversified
organization with operations in many aspects of the financial services
industry, including insurance and investment management.

The Manager manages the Fund's portfolio and makes investment
decisions for the Fund. The Manager also administers Equity Funds V, Inc.'s
affairs and pays the salaries of all the directors, officers and employees of
Equity Funds V, Inc. who are affiliated with the Manager. For these services,
the Manager is paid an annual fee equal to 0.65% on the first $500 million of
average daily net assets, 0.625% on the next $500 million and 0.60% on the
average daily net assets in excess of $1 billion.

Babak Zenouzi oversees the Fund's asset allocation strategy and has
primary responsibility for making day-to-day investment decisions for the
Fund's investments in income generating equity securities. Mr. Zenouzi, a Vice
President/Portfolio Manager of Equity Funds V, Inc., has been a member of the
Fund's management team since its inception. Mr. Zenouzi holds a BS in Finance
and Economics from Babson College in Wellesley, Massachusetts, and an MS in
Finance from Boston College. Prior to joining the Manager in 1992, he was with
The Boston Company where he held the positions of assistant vice president,
senior financial analyst, financial analyst and portfolio accountant.

Gerald T. Nichols has primary responsibility for making day-to-day
investment decisions for the Fund regarding its investments in debt securities.
Mr. Nichols, a Vice President/Senior Portfolio Manager of Equity Funds V, Inc.,
has been a member of the Fund's management team since its inception. Mr.
Nichols is a graduate of the University of Kansas, where he received a BS in
Business Administration and an MS in Finance. Prior to joining the Manager, he
was a high yield credit analyst at Waddell & Reed, Inc. and subsequently the
investment officer for a private merchant banking firm. He is a Chartered
Financial Analyst.

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PORTFOLIO TRADING PRACTICES
The Fund normally will not invest for short-term trading purposes.
However, the Fund may sell securities without regard to the length of time they
have been held. The degree of portfolio activity will affect brokerage costs
of the Fund and may affect taxes payable by the Fund's shareholders. Given the
Fund's investment objective, its annual portfolio turnover rate is not expected
to exceed 100%. A turnover rate of 100% would occur, for example, if all the
investments in the Fund's portfolio at the beginning of the year were replaced
by the end of the year.

The Fund uses its best efforts to obtain the best available price and
most favorable execution for portfolio transactions. Orders may be placed with
brokers or dealers who provide brokerage and research services to the Manager
or to their advisory clients. These services may be used by the Manager in
servicing any of its accounts. Subject to best price and execution, the Fund
may consider a broker/dealer's sales of Fund shares in placing portfolio orders
and may place orders with broker/dealers that have agreed to defray certain
Fund expenses such as custodian fees.

PERFORMANCE INFORMATION
From time to time, the Fund may quote yield or total return
performance of the Classes in advertising and other types of literature.

The current yield for each Class will be calculated by dividing the
annualized net investment income earned by that Class during a recent 30-day
period by the maximum offering price per share on the last day of the period.
The yield formula provides for semi-annual compounding, which assumes that net
investment income is earned and reinvested at a constant rate and annualized at
the end of a six-month period.

Total return will be based on a hypothetical $1,000 investment,
reflecting the reinvestment of all distributions at net asset value and: (i)
in the case of Class A Shares, the impact of the maximum front-end sales charge
at the beginning of each specified period; and (ii) in the case of Class B
Shares and Class C Shares, the deduction of any applicable CDSC at the end of
the relevant period. Each presentation will include the average annual total
return for one-, five- and ten-year or life-of-fund periods, as relevant. The
Fund may also advertise aggregate and average total return information
concerning a Class over additional periods of time. In addition, the Fund may
present total return information that does not reflect the deduction of the
maximum front-end sales charge or any applicable CDSC. In this case, such
total return information would be more favorable than total return information
that includes the deductions of the maximum front-end sales charge or any
applicable CDSC.

Yield and net asset value fluctuate and are not guaranteed. Past
performance is not a guarantee of future results.

DISTRIBUTION (12B-1) AND SERVICE
The Distributor, Delaware Distributors, L.P., serves as the national
distributor of the Fund's shares under a Distribution Agreement with Equity
Funds V, Inc. dated as of November 29, 1996.

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<PAGE> 56

Equity Funds V, Inc. has adopted a separate distribution plan under
Rule 12b-1 for each of the Class A Shares, Class B Shares and Class C Shares of
the Fund (the "Plans"). The Plans permit the Fund to pay the Distributor from
the assets of the respective Classes a monthly fee for the Distributor's
services and expenses in distributing and promoting sales of shares. These
expenses include, among other things, preparing and distributing
advertisements, sales literature, and prospectuses and reports used for sales
purposes, compensating sales and marketing personnel, holding special
promotions for specified periods of time, and paying distribution and
maintenance fees to brokers, dealers and others. In connection with the
promotion of shares of the Classes, the Distributor may, from time to time, pay
to participate in dealer- sponsored seminars and conferences, and reimburse
dealers for expenses incurred in connection with preapproved seminars,
conferences, and advertising. The Distributor may pay or allow additional
promotional incentives to dealers as part of preapproved sales contests and/or
to dealers who provide extra training and information concerning a Class and
increase sales of the Class. In addition, the Fund may make payments from the
12b-1 Plan fees of the respective Class directly to others, such as banks, who
aid in the distribution of Class shares or provide services in respect of a
Class, pursuant to service agreements with Equity Funds V, Inc. The
Distributor has elected voluntarily to waive its right to receive 12b-1 fees
(including service fees) from the commencement of the public offering of the
Classes through May 31, 1997.

The 12b-1 Plan expenses relating to each of the Class B Shares and
Class C Shares of the Fund are also used to pay the Distributor for advancing
the commission costs to dealers with respect to the initial sale of such
shares.

Absent any applicable fee waiver, the aggregate fees paid by the Fund
from the assets of the respective Classes to the Distributor and others under
the Plans may not exceed (i) 0.30% of the Class A Shares' average daily net
assets in any year, and (ii) 1% (0.25% of which are service fees to be paid to
the Distributor, dealers and others for providing personal service and/or
maintaining shareholder accounts) of each of the Class B Shares' and Class C
Shares' average daily net assets in any year. The Class A, Class B and Class C
Shares will not incur any distribution expenses beyond these limits, which may
not be increased without shareholder approval.

While payments, if any, pursuant to the Plans may not exceed 0.30%
annually with respect to the Class A Shares, and 1% annually with respect to
each of the Class B Shares and the Class C Shares, the Plans do not limit fees
to amounts actually expended by the Distributor. It is therefore possible that
the Distributor may realize a profit in any particular year. However, the
Distributor currently expects that its distribution expenses will likely equal
or exceed payments to it under the Plans. The Distributor may, however, incur
such additional expenses and make additional payments to dealers from its own
resources to promote the distribution of shares of the Classes. The monthly
fees paid to the Distributor are subject to the review and approval of Equity
Funds V, Inc.'s unaffiliated directors, who may reduce the fees or terminate
the Plans at any time.

The Fund's Plans do not apply to the Retirement Income Fund
Institutional Class of shares. Those shares are not included in calculating
the Plans' fees, and the Plans are not used to assist in the distribution and
marketing of the Retirement Income Fund Institutional Class shares.

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<PAGE> 57

The Transfer Agent, Delaware Service Company, Inc., serves as the
shareholder servicing, dividend disbursing and transfer agent for the Fund
pursuant to an amended and restated agreement dated as of November 29, 1996.
The Transfer Agent also provides accounting services to the Fund pursuant to
the terms of a separate Fund Accounting Agreement. The directors of Equity
Funds V, Inc. annually review service fees paid to the Transfer Agent.

The Distributor and the Transfer Agent are also indirect, wholly owned
subsidiaries of DMH.

EXPENSES
The Fund is responsible for all of its own expenses other than those
borne by the Manager under the Investment Management Agreement and those borne
by the Distributor under the Distribution Agreement. The expense ratio of each
Class will reflect the impact of its 12b-1 Plan.

Equity Funds V, Inc. is an open-end management investment company.
The Fund's portfolio of assets is diversified as defined by the 1940 Act.
Commonly known as a mutual fund, Equity Funds V, Inc. was organized as a
Maryland corporation on January 16, 1987. In addition to the Fund, Equity
Funds V, Inc. presently offers one other series of shares, the Value Fund
series.

Equity Funds V, Inc.'s shares have a par value of $0.01, equal voting
rights, except as noted below, and are equal in all other respects. Equity
Funds V, Inc.'s shares have noncumulative voting rights which means that the
holders of more than 50% of Equity Funds V, Inc.'s shares voting for the
election of directors can elect 100% of the directors if they choose to do so.
Under Maryland law, Equity Funds V, Inc. is not required, and does not intend,
to hold annual meetings of shareholders unless, under certain circumstances, it
is required to do so under the 1940 Act. Shareholders of 10% or more of Equity
Funds V, Inc.'s shares may request that a special meeting be called to consider
the removal of a director.

In addition to Class A Shares, Class B Shares and Class C Shares, the
Fund also offers the Retirement Income Fund Institutional Class shares. Shares
of each class represent proportionate interests in the assets of the Fund and
have the same voting and other rights and preferences as the other classes of
the Fund, except that shares of the Retirement Income Fund Institutional Class
are not subject to, and may not vote on matters affecting, the Distribution
Plans under Rule 12b-1 relating to the Class A, Class B and Class C Shares.
Similarly, as a general matter, the shareholders of Class A Shares, Class B
Shares and Class C Shares may vote only on matters affecting the 12b-1 Plan
that relates to the class of shares that they hold. However, the Class B
Shares may vote on any proposal to increase materially the fees to be paid by
the Fund under the Rule 12b-1 Plan relating to the Class A Shares.

It is expected that Lincoln National Corporation Employees' Retirement
Trust (the "Trust") will make an initial investment in the Fund, which could
result in the Trust owning up to 100% of the outstanding shares of the Fund.
Subject to certain limited exceptions, there would be no limitation on the
Trust's ability to redeem its shares of the Fund and it may elect to do so at
any time.

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OTHER INVESTMENT POLICIES AND RISK CONSIDERATIONS

U.S. GOVERNMENT SECURITIES
U.S. Treasury securities are backed by the "full faith and credit" of
the United States. Securities issued or guaranteed by federal agencies and
U.S. government sponsored instrumentalities may or may not be backed by the
full faith and credit of the United States. In the case of securities not
backed by the full faith and credit of the United States, investors in such
securities look principally to the agency or instrumentality issuing or
guaranteeing the obligation for ultimate repayment, and may not be able to
assert a claim against the United States itself in the event the agency or
instrumentality does not meet its commitment. Agencies which are backed by the
full faith and credit of the United States include the Export-Import Bank,
Farmers Home Administration, Federal Financing Bank, the Federal Housing
Administration, the Maritime Administration, the Small Business Administration,
and others. Certain agencies and instrumentalities, such as the Government
National Mortgage Association ("GNMA"), are, in effect, backed by the full
faith and credit of the United States through provisions in their charters that
they may make "indefinite and unlimited" drawings on the Treasury, if needed to
service its debt. Debt from certain other agencies and instrumentalities,
including the Federal Home Loan Bank and Federal National Mortgage Association,
are not guaranteed by the United States, but those institutions are protected
by the discretionary authority for the U.S. Treasury to purchase certain
amounts of their securities to assist the institutions in meeting their debt
obligations. Finally, other agencies and instrumentalities, such as the Farm
Credit System, the Tennessee Valley Authority and the Federal Home Loan
Mortgage Corporation, are federally chartered institutions under U.S.
government supervision, but their debt securities are backed only by the
creditworthiness of those institutions, not the U.S. government.

An instrumentality of a U.S. government agency is a government agency
organized under Federal charter with government supervision. Instrumentalities
issuing or guaranteeing securities include, among others, Federal Home Loan
Banks, the Federal Land Banks, Central Bank for Cooperatives, Federal
Intermediate Credit Banks and the Federal National Mortgage Association.

The maturities of such securities usually range from three months to
thirty years. While such securities are guaranteed as to principal and
interest by the U.S. government or its instrumentalities, their market values
may fluctuate and are not guaranteed, which may, along with the other
securities in the Fund's portfolio, cause a Class' daily net asset value to
fluctuate.

BRADY BONDS

Among the foreign fixed-income securities in which the Fund may invest
are Brady Bonds. Brady Bonds are debt securities issued under the framework of
the Brady Plan, an initiative announced by former U.S. Treasury Secretary
Nicholas F. Brady in 1989 as a mechanism for debtor nations to restructure
their outstanding external indebtedness (generally commercial bank debt).
Brady Bonds are not direct or indirect obligations of the U.S. government or
any of its agencies or instrumentalities and are not guaranteed by the U.S.
government or any of its agencies or instrumentalities. In so restructuring
its external debt, a debtor nation negotiates with its existing bank lenders,
as well as multilateral institutions such as the World Bank and the
International Monetary Fund, to exchange its commercial bank debt for newly
issued bonds (Brady Bonds). The Manager believes that economic reforms
undertaken by countries in connection with the issuance of Brady Bonds make the
debt of countries which have issued or have announced plans to issue Brady
Bonds an attractive opportunity for investment. Investors, however,

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should recognize that the Brady Plan only sets forth general guiding principles
for economic reform and debt reduction, emphasizing that solutions must be
negotiated on a case-by-case basis between debtor nations and their creditors.
In addition, Brady Bonds have been issued only recently and, accordingly, do
not have a long payment history.

FOREIGN GOVERNMENT SECURITIES
With respect to investment in debt issues of foreign governments,
including Brady Bonds, the ability of a foreign government or
government-related issuer to make timely and ultimate payments on its external
debt obligations will also be strongly influenced by the issuer's balance of
payments, including export performance, its access to international credits and
investments, fluctuations in interest rates and the extent of its foreign
reserves. A country whose exports are concentrated in a few commodities or
whose economy depends on certain strategic imports could be vulnerable to
fluctuations in international prices of these commodities or imports. If
foreign government or government-related issuers cannot generate sufficient
earnings from foreign trade to service its external debt, they may need to
depend on continuing loans and aid from foreign governments, commercial banks
and multilateral organizations, and inflows of foreign investment. The
commitment on the part of these foreign governments, multilateral organizations
and others to make such disbursements may be conditioned on the government's
implementation of economic reforms and/or economic performance and the timely
service of its obligations. Failure to implement such reforms, achieve such
levels of economic performance or repay principal or interest when due may
curtail the willingness of such third parties to lend funds, which may further
impair the issuer's ability or willingness to service its debts in a timely
manner. The cost of servicing external debt generally will also be adversely
affected by rising international interest rates because many external debt
obligations bear interest at rates which are adjusted based upon international
interest rates. The ability to service external debt will also depend on the
level of the relevant government's international currency reserves and its
access to foreign exchange. Currency devaluations may affect the ability of a
government issuer to obtain sufficient foreign exchange to service its external
debt. If a foreign governmental issuer defaults on its obligations, the Fund
may have limited legal recourse against the issuer and/or guarantor.

ZERO COUPON BONDS AND PAY-IN-KIND BONDS

Although the Fund does not intend to purchase a substantial amount of
zero coupon bonds or PIK bonds, from time to time, the Fund may acquire zero
coupon bonds and, to a lesser extent, PIK bonds. Zero coupon bonds are debt
obligations which do not entitle the holder to any periodic payments of
interest prior to maturity or a specified date when the securities begin paying
current interest, and therefore are issued and traded at a discount from their
face amounts or par value. PIK bonds pay interest through the issuance to
holders of additional securities. Zero coupon bonds and PIK bonds are
generally considered to be more interest-sensitive than income bearing bonds,
to be more speculative than interest-bearing bonds, and to have certain tax
consequences which could, under certain circumstances, be adverse to the Fund.
For example, with zero coupon bonds, the Fund accrues, and is required to
distribute to shareholders, income on such bonds. However, the Fund may not
receive the cash associated with this income until the bonds are sold or
mature. If the Fund did not have sufficient cash to make the required
distribution of accrued income, the Fund could be required to sell other
securities in its portfolio or to borrow to generate the cash required.

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a bank and, to the extent that such borrowing exceeds 5% of the value of the
Fund's net assets, asset coverage of at least 300% is required. In the event
that such asset coverage shall at any time fall below 300%, the Fund shall,
within three days thereafter (not including Sundays or holidays, or such longer
period as the Securities and Exchange Commission may prescribe by rules and
regulations), reduce the amount of its borrowings to such an extent that the
asset coverage of such borrowings shall be at least 300%. The Fund will not
pledge more than 10% of its net assets, or issue senior securities as defined
in the 1940 Act, except for notes to banks. Investment securities will not be
purchased while the Fund has an outstanding borrowing.

WHEN-ISSUED AND DELAYED DELIVERY SECURITIES
The Fund may purchase securities on a when-issued or delayed delivery
basis. In such transactions, instruments are purchased with payment and
delivery taking place in the future in order to secure what is considered to be
an advantageous yield or price at the time of the transaction. Delivery of and
payment for these securities may take as long as a month or more after the date
of the purchase commitment. The Fund will maintain with its custodian bank a
separate account with a segregated portfolio of liquid securities in an amount
at least equal to these commitments. The payment obligation and the interest
rates that will be received are each fixed at the time the Fund enters into the
commitment and no interest accrues to the Fund until settlement. Thus, it is
possible that the market value at the time of settlement could be higher or
lower than the purchase price if the general level of interest rates has
changed.

PORTFOLIO LOAN TRANSACTIONS
The Fund may loan up to 25% of its assets to qualified broker/dealers
or institutional investors.

The major risk to which the Fund would be exposed on a loan
transaction is the risk that the borrower would become bankrupt at a time when
the value of the security goes up. Therefore, the Fund will only enter into
loan arrangements after a review of all pertinent facts by the Manager, subject
to overall supervision by the Board of Directors, including the
creditworthiness of the borrowing broker, dealer or institution and then only
if the consideration to be received from such loans would justify the risk.
Creditworthiness will be monitored on an ongoing basis by the Manager.

RULE 144A SECURITIES
The Fund may invest in restricted securities, including privately
placed securities, some of which may be eligible for resale without
registration pursuant to Rule 144A ("Rule 144A Securities") under the
Securities Act of 1933. Rule 144A permits many privately placed and legally
restricted securities to be freely traded among certain institutional buyers
such as the Fund. The Fund may invest no more than 15% of the value of its net
assets in illiquid securities.

While maintaining oversight, the Board of Directors has delegated to
the Manager the day-to-day function of determining whether or not individual
Rule 144A Securities are liquid for purposes of the Fund's 15% limitation on
investments in illiquid securities. The Board has instructed the Manager to
consider the following factors in determining the liquidity of a Rule 144A
Security: (i) the frequency of trades and trading volume for the security;
(ii) whether at least three dealers are willing to purchase or sell the
security and the number of potential purchasers; (iii) whether at least two
dealers are making a market in the security; (iv) the nature of the security
and the nature of the marketplace trades (e.g., the time needed to dispose of
the security, the method of soliciting offers, and the mechanics of transfer).

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If the Manager determines that a Rule 144A Security which was
previously determined to be liquid is no longer liquid and, as a result, the
Fund's holdings of illiquid securities exceed the Fund's 15% limit on
investments in such securities, the Manager will determine what action to take
to ensure that the Fund continues to adhere to such limitation.

INVESTMENT COMPANY SECURITIES
Any investments that the Fund makes in either closed-end or open-end
investment companies will be limited by the 1940 Act, and would involve an
indirect payment of a portion of the expenses, including advisory fees, of such
other investment companies. Under the 1940 Act's current limitations, the Fund
may not (1) own more than 3% of the voting stock of another investment company;
(2) invest more than 5% of the Fund's total assets in the shares of any one
investment company; nor (3) invest more than 10% of the Fund's total assets in
shares of other investment companies. If the Fund elects to limit its
investment in other investment companies to closed-end investment companies,
the 3% limitation described above is increased to 10%. These percentage
limitations also apply to the Fund's investments in unregistered investment
companies.

REPURCHASE AGREEMENTS

In order to invest its short-term cash reserves or when in a temporary
defensive posture, the Fund may enter into repurchase agreements with banks or
broker/dealers deemed to be creditworthy by the Manager, under guidelines
approved by the Board of Directors. A repurchase agreement is a short-term
investment in which the purchaser (i.e. the Fund) acquires ownership of a debt
security and the seller agrees to repurchase the obligation at a future time
and set price, thereby determining the yield during the purchaser's holding
period. Generally, repurchase agreements are of short duration, often less
than one week but on occasion for longer periods. Not more than 15% of the
Fund's assets may be invested in repurchase agreements of over seven-days'
maturity or other illiquid assets. Should an issuer of a repurchase agreement
fail to repurchase the underlying security, the loss to the Fund, if any, would
be the difference between the repurchase price and the market value of the
security. The Fund will limit its investments in repurchase agreements to
those which the Manager under guidelines of the Board of Directors determines
to present minimal credit risks and which are of high quality. In addition,
the Fund must have collateral of at least 100% of the repurchase price,
including the portion representing the Fund's yield under such agreements,
which is monitored on a daily basis.

FOREIGN CURRENCY TRANSACTIONS
Although the Fund values its assets daily in terms of U.S. dollars, it
does not intend to convert its holdings of foreign currencies into U.S. dollars
on a daily basis. The Fund will, however, from time to time, purchase or sell
foreign currencies and/or engage in forward foreign currency transactions in
order to expedite settlement of portfolio transactions and to minimize currency
value fluctuations. The Fund may conduct its foreign currency exchange
transactions on a spot (i.e., cash) basis at the spot rate prevailing in the
foreign currency exchange market or through entering into contracts to purchase
or sell foreign currencies at a future date (i.e., a "forward foreign currency"
contract or "forward" contract). A forward contract involves an obligation to
purchase or sell a specific currency at a future date, which may be any fixed
number of days from the date of the contract, agreed upon by the parties, at a
price set at the time of the contract. The Fund will convert currency on a
spot basis from time to time, and investors should be aware of the costs of
currency conversion.

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<PAGE> 62
The Fund may enter into forward contracts to "lock in" the price of a
security it has agreed to purchase or sell, in terms of U.S. dollars or other
currencies in which the transaction will be consummated. By entering into a
forward contract for the purchase or sale, for a fixed amount of U.S. dollars
or foreign currency, of the amount of foreign currency involved in the
underlying security transaction, the Fund will be able to protect itself
against a possible loss resulting from an adverse change in currency exchange
rates during the period between the date the security is purchased or sold and
the date on which payment is made or received.

When the Manager believes that the currency of a particular country
may suffer a significant decline against the U.S. dollar or against another
currency, the Fund may enter into a forward foreign currency contract to sell,
for a fixed amount of U.S. dollars or other appropriate currency, the amount of
foreign currency approximating the value of some or all of the Fund's
securities denominated in such foreign currency.

The Fund will not enter into forward contracts or maintain a net
exposure to such contracts where the consummation of the contracts would
obligate the Fund to deliver an amount of foreign currency in excess of the
value of the Fund's securities or other assets denominated in that currency.

At the maturity of a forward contract, the Fund may either sell the
portfolio security and make delivery of the foreign currency, or it may retain
the security and terminate its contractual obligation to deliver the foreign
currency by purchasing an "offsetting" contract with the same currency trader
obligating it to purchase, on the same maturity date, the same amount of the
foreign currency. The Fund may realize a gain or loss from currency
transactions. With respect to forward foreign currency contracts, the precise
matching of forward contract amounts and the value of the securities involved
is generally not possible since the future value of such securities in foreign
currencies will change as a consequence of market movements in the value of
those securities between the date the forward contract is entered into and the
date it matures. The projection of short-term currency strategy is highly
uncertain.

It is impossible to forecast the market value of Fund securities at
the expiration of the contract. Accordingly, it may be necessary for the Fund
to purchase additional foreign currency on the spot market (and bear the
expense of such purchase) if the market value of the security is less than the
amount of foreign currency the Fund is obligated to deliver and if a decision
is made to sell the security and make delivery of the foreign currency.
Conversely, it may be necessary to sell on the spot market some of the foreign
currency received upon the sale of a security if its market value exceeds the
amount of foreign currency the Fund is obligated to deliver.

OPTIONS
The Manager may employ options techniques in an attempt to protect
appreciation attained and to increase shareholder return by seeking to take
advantage of the liquidity available in the options market. The Fund may
purchase call options on foreign or U.S. securities and indices and enter into
related closing transactions and the Fund may write covered call options on
such securities. The Fund may also purchase put options on such securities and
indices and enter into related closing transactions.

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<PAGE> 63
for an agreed upon price up to an agreed date. The advantage is that the
purchaser may hedge against an increase in the price of securities it
ultimately wishes to buy or take advantage of a rise in a particular index.
The Fund will only purchase call options to the extent that premiums paid on
all outstanding call options do not exceed 2% of its total assets. The Fund
may write covered call options in an amount not to exceed 10% of its total
assets.

A put option enables the purchaser of the option, in return for the
premium paid, to sell the security underlying the option to the writer at the
exercise price during the option period, and the writer of the option has the
obligation to purchase the security from the purchaser of the option. The Fund
will only purchase put options to the extent that the premiums on all
outstanding put options do not exceed 2% of its total assets. The advantage is
that the purchaser can be protected should the market value of the security
decline or should a particular index decline.

An option on a securities index gives the purchaser of the option, in
return for the premium paid, the right to receive from the seller cash equal to
the difference between the closing price of the index and the exercise price of
the option.

Closing transactions essentially let the Fund offset put options or
call options prior to exercise or expiration. If the Fund cannot effect
closing transactions, it may have to hold a security it would otherwise sell or
deliver a security it might want to hold.

In purchasing put and call options, the premium paid by the Fund plus
any transaction costs will reduce any benefit realized by the Fund upon
exercise of the option. With respect to writing covered call options, the Fund
may lose the potential market appreciation of the securities subject to the
option, if the Manager's judgment is wrong and the price of the security moves
in the opposite direction from what was anticipated.

The Fund may use both Exchange-traded and over-the-counter options.
Certain over-the-counter options may be illiquid. The Fund will only invest in
such options to the extent consistent with its 15% limitation on investment in
illiquid securities. The Fund will comply with Securities and Exchange
Commission asset segregation and coverage requirements when engaging in these
types of transactions.

FUTURES
Futures contracts are agreements for the purchase or sale for future
delivery of securities. When a futures contract is sold, the Fund incurs a
contractual obligation to deliver the securities underlying the contract at a
specified price on a specified date during a specified future month. A
purchase of a futures contract means the acquisition of a contractual right to
obtain delivery to the Fund of the securities called for by the contract at a
specified price during a specified future month.

While futures contracts provide for the delivery of securities,
deliveries usually do not occur. Contracts are generally terminated by
entering into an offsetting transaction. When the Fund enters into a futures
transaction, it must deliver to the futures commission merchant selected by the
Fund an amount referred to as "initial margin." This amount is maintained by
the futures commission merchant in an account at the Fund's custodian bank.
Thereafter, a "variation margin" may be paid by the Fund to, or

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drawn by the Fund from, such account in accordance with controls set for such
account, depending upon changes in the price of the underlying securities
subject to the futures contract.

The Fund may also purchase and write options to buy or sell futures
contracts. Options on futures are similar to options on securities except that
options on futures give the purchaser the right, in return for the premium
paid, to assume a position in a futures contract, rather than actually to
purchase or sell the futures contract, at a specified exercise price at any
time during the period of the option.

The purpose of the purchase or sale of futures contracts with respect
to a certain security is to protect the Fund against the adverse effects of
fluctuations in interest rates without actually buying or selling that
security. Similarly, when it is expected that interest rates may decline,
futures contracts may be purchased to hedge in anticipation of subsequent
purchases of securities at higher prices.

Foreign currency futures contracts operate similarly to futures
contracts related to securities. When the Fund sells a futures contract on a
foreign currency it is obligated to deliver that foreign currency at a
specified future date. Similarly, a purchase by the Fund gives it a
contractual right to receive a foreign currency. This enables the Fund to
"lock-in" exchange rates.

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<PAGE> 65

APPENDIX A--INVESTMENT ILLUSTRATIONS

ILLUSTRATIONS OF THE POTENTIAL IMPACT ON INVESTMENT BASED ON PURCHASE OPTION

$10,000 PURCHASE

<TABLE>
<CAPTION>
Scenario 1 Scenario 2
No Redemption Redeem 1st Year
-------------------------------- --------------------------------
Year Class A Class B Class C Class A Class B Class C
---- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
0 9,525 10,000 10,000 9,525 10,000 10,000
1 10,192 10,630 10,630 10,192 10,230 10,530+
2 10,905 11,300 11,300
3 11,669 12,012 12,012
4 12,485 12,768 12,768
5 13,359 13,573 13,573
6 14,294 14,428 14,428
7 15,295 15,337 15,337
8 16,366+ 16,303 16,303
9 17,511 17,444* 17,330
10 18,737 18,665* 18,422
</TABLE>

<TABLE>
<CAPTION>
Scenario 3 Scenario 4
Redeem 3rd Year Redeem 5th Year
-------------------------------- --------------------------------
Year Class A Class B Class C Class A Class B Class C
- ---- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
0 9,525 10,000 10,000 9,525 10,000 10,000
1 10,192 10,630 10,630 10,192 10,630 10,630
2 10,905 11,300 11,300 10,905 11,300 11,300
3 11,669 11,712 12,012+ 11,669 12,012 12,012
4 12,485 12,768 12,768
5 13,359 13,373 13,573+
6
7
8
9
10
</TABLE>

*This assumes that Class B Shares were converted to Class A Shares at the end
of the eighth year.

$250,000 PURCHASE

<TABLE>
<CAPTION>
Scenario 1 Scenario 2
No Redemption Redeem 1st Year
- ------------------------------------------ -------------------------------
Year Class A Class B Class C Class A Class B Class C
---- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
0 243,750 250,000 250,000 243,750 250,000 250,000
1 260,813 265,750 265,750 260,813 255,750 263,250+
2 279,069 282,492 282,492
3 298,604 300,289 300,289
4 319,507+ 319,207 319,207
5 341,872 339,318 339,318
6 365,803 360,695 360,695
7 391,409 383,418 383,418
8 418,808 407,574 407,574
9 448,124 436,104* 433,251
10 479,493 466,631* 460,546
</TABLE>

<TABLE>
<CAPTION>
Scenario 3 Scenario 4
Redeem 3rd Year Redeem 5th Year
------------------------------ --------------------------------
Year Class A Class B Class C Class A Class B Class C
---- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
0 243,750 250,000 250,000 243,750 250,000 250,000
1 260,813 265,750 265,750 260,813 265,750 265,750
2 279,069 282,492 282,492 279,069 282,492 282,492
3 298,604 292,789 300,289+ 298,604 300,289 300,289
4 319,507+ 319,207 319,207
5 341,872 334,318 339,318
6
7
8
9
10
</TABLE>

*This assumes that Class B Shares were converted to Class A Shares at the end
of the eighth year.

Illustrations do not reflect any applicable waiver of 12b-1 fees. If such fee
waivers were reflected, the illustrations represented above would be different.

Assumes a hypothetical return for Class A of 7% per year, a hypothetical return
for Class B of 6.3% for years 1-8 and 7% for years 9-10, and a hypothetical
return for Class C of 6.3% per year.

Hypothetical returns vary due to the different expense structure for each Class
and do not represent actual performance.

Class A purchase subject to appropriate sales charge breakpoint (4.75% @
$10,000; 3.75% @ $100,000; 2.50% @ $250,000).

Class B purchase assessed appropriate CDSC upon redemption (4%-4%-3%-3%-2%-1%
in years 1-2-3-4-5-6).

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<PAGE> 66
Class C purchase assessed 1% CDSC upon redemption in year 1.

Figures marked "+" identify which class offers the greater return potential
based on investment amount, the holding period and the expense structure for
each Class.

<PAGE> 67

APPENDIX B--CLASSES OFFERED

<TABLE>
<CAPTION>
GROWTH OF CAPITAL A CLASS B CLASS C CLASS CONSULTANT CLASS
- ----------------- ------- ------- ------- ----------------
<S> <C> <C> <C> <C>
Trend Fund x x x -
Enterprise Fund x x x -
DelCap Fund x x x -
Value Fund x x x -
U.S. Growth Fund x x x -

TOTAL RETURN
Devon Fund x x x -
Decatur Total Return Fund x x x -
Decatur Income Fund x x x -
Delaware Fund x x x -

GLOBAL DIVERSIFICATION
Emerging Markets Fund x x x -
New Pacific Fund x x x -
International Equity Fund x x x -
World Growth Fund x x x -
Global Assets Fund x x x -
Global Bond Fund x x x -

CURRENT INCOME
Delchester Fund x x x -
Strategic Income Fund x x x -
Corporate Income Fund x x x -
Federal Bond Fund x x x -
U.S. Government Fund x x x -
Limited-Term Government Fund x x x -

TAX-FREE CURRENT INCOME
Tax-Free Pennsylvania Fund x x x -
Tax-Free USA Fund x x x -
Tax-Free Insured Fund x x x -
Tax-Free USA Intermediate Fund x x x -

MONEY MARKET FUNDS
Delaware Cash Reserve x x x x
U.S. Government Money Fund x - - x
Tax-Free Money Fund x - - x
</TABLE>

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<PAGE> 68

APPENDIX C--RATINGS

The Fund's assets may be invested in securities rated BBB or lower by
S&P or Fitch, Baa or lower by Moody's, in securities similarly rated by another
nationally recognized statistical rating organization, and in unrated
securities that are deemed by the Manager to be comparable in quality to
similar rated securities. Credit ratings evaluate only the safety of
principal, interest and dividends and do not consider the market value risk
associated with high-yield securities.

General Rating Information

BONDS AND CONVERTIBLE SECURITIES
Excerpts from Moody's description of its bond ratings: Aaa--judged to
be the best quality. They carry the smallest degree of investment risk;
Aa--judged to be of high quality by all standards; A--possess favorable
attributes and are considered "upper medium" grade obligations; Baa--considered
as medium grade obligations. Interest payments and principal security appear
adequate for the present but certain protective elements may be lacking or may
be characteristically unreliable over any great length of time; Ba--judged to
have speculative elements; their future cannot be considered as well assured.
Often the protection of interest and principal payments may be very moderate
and thereby not well safeguarded during both good and bad times over the
future. Uncertainty of position characterizes bonds in this class; B--
generally lack characteristics of the desirable investment. Assurance of
interest and principal payments or of maintenance of other terms of the
contract over any long period of time may be small; Caa--are of poor standing.
Such issues may be in default or there may be present elements of danger with
respect to principal or interest; Ca--represent obligations which are
speculative in a high degree. Such issues are often in default or have other
marked shortcomings; C--the lowest rated class of bonds and issues so rated can
be regarded as having extremely poor prospects of ever attaining any real
investment standing.

Excerpts from S&P's description of its bond ratings: AAA--highest
grade obligations. They possess the ultimate degree of protection as to
principal and interest; AA--also qualify as high grade obligations, and in the
majority of instances differ from AAA issues only in a small degree; A--strong
ability to pay interest and repay principal although more susceptible to
changes in circumstances; BBB--regarded as having an adequate capacity to pay
interest and repay principal; BB, B, CCC, CC--regarded, on balance, as
predominantly speculative with respect to capacity to pay interest and repay
principal in accordance with the terms of the obligation. BB indicates the
lowest degree of speculation and CC the highest degree of speculation. While
such debt will likely have some quality and protective characteristics, these
are outweighed by large uncertainties or major risk exposures to adverse
conditions; C--reserved for income bonds on which no interest is being paid;
D--in default, and payment of interest and/or repayment of principal is in
arrears.

Excerpts from Fitch's description of its bond ratings:

AAA--Bonds considered to be investment grade and of the highest credit
quality. The obligor has an exceptionally strong ability to pay interest and
repay principal, which is unlikely to be affected by reasonably foreseeable
events; AA--Bonds considered to be investment grade and of very high credit
quality. The obligor's ability to pay interest and repay principal is very
strong, although not quite as strong as bonds rated AAA. Because bonds rated
in the AAA and AA categories are not significantly vulnerable to foreseeable
future developments, short- term debt of these issuers is generally rated F-1+;
A--Bonds considered to be investment grade and of high credit quality. The
obligor's ability to pay interest

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<PAGE> 69

and repay principal is considered to be strong, but may be more vulnerable to
adverse changes in economic conditions and circumstances than bonds with higher
ratings; BBB--Bonds considered to be investment grade and of satisfactory
credit quality. The obligor's ability to pay interest and repay principal is
considered to be adequate. Adverse changes in economic conditions and
circumstances, however, are more likely to have adverse impact on these bonds,
and therefore impair timely payment. The likelihood that the ratings of these
bonds will fall below investment grade is higher than for bonds with higher
ratings; BB--Bonds are considered speculative. The obligor's ability to pay
interest and repay principal may be affected over time by adverse economic
changes. However, business and financial alternatives can be identified which
could assist the obligor in satisfying its debt service requirements; B--Bonds
are considered highly speculative. While bonds in this class are currently
meeting debt service requirements, the probability of continued timely payment
of principal and interest reflects the obligor's limited margin of safety and
the need for reasonable business and economic activity throughout the life of
the issue; CCC--Bonds have certain identifiable characteristics which, if not
remedied, may lead to default. The ability to meet obligations requires an
advantageous business and economic environment; CC--Bonds are minimally
protected. Default in payment of interest and/or principal seems probable over
time; C-- Bonds are in imminent default in payment of interest or principal;
and DDD, DD AND D--Bonds are in default on interest and/or principal payments.
Such bonds are extremely speculative and should be valued on the basis of their
ultimate recovery value in liquidation or reorganization of the obligor. "DDD"
represents the highest potential for recovery on these bonds, and "D"
represents the lowest potential for recovery.

Plus and minus signs are used with a rating symbol to indicate the
relative position of a credit within the rating category. Plus and minus
signs, however, are not used in the "AAA" category.

COMMERCIAL PAPER
Excerpts from Moody's description of its two highest commercial paper
ratings: P-1--the highest grade possessing greatest relative strength;
P-2--second highest grade possessing less relative strength than the highest
grade.

Excerpts from S&P's description of its two highest commercial paper
ratings: A-1--judged to be the highest investment grade category possessing
the highest relative strength; A-2--investment grade category possessing less
relative strength than the highest rating.

PREFERRED STOCK
The following are excerpts from S&P's description of its preferred
stock ratings:

An S&P preferred stock rating is an assessment of the capacity and
willingness of an issuer to pay preferred stock dividends and any applicable
sinking fund obligations. A preferred stock rating differs from a bond rating
inasmuch as it is assigned to an equity issue, which issue is intrinsically
different from, and subordinated to, a debt issue. Therefore, to reflect this
difference, the preferred stock rating symbol will normally not be higher than
the debt rating symbol assigned to, or that would be assigned to, the senior
debt of the same issuer.

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<PAGE> 70
The preferred stock ratings are based on the following considerations:

1. Likelihood of payment--capacity and willingness of the issuer
to meet the timely payment of preferred stock dividends and any applicable
sinking fund requirements in accordance with the terms of the obligation.

2. Nature of, and provisions of, the issue.

3. Relative position of the issue in the event of bankruptcy,
reorganization, or other arrangements affecting creditors'
rights.

AAA This is the highest rating that may be assigned by S&P to a
preferred stock issue and indicates an extremely strong
capacity to pay the preferred stock obligations.

AA A preferred stock issue rated "AA" also qualifies as a
high-quality fixed-income security. The capacity to pay
preferred stock obligations is very strong, although not as
overwhelming as for issues rated "AAA."

A An issue rated "A" is backed by a sound capacity to pay the
preferred stock obligations, although it is somewhat more
susceptible to the adverse effects of changes in circumstances
and economic conditions.

BBB An issue rated "BBB" is regarded as backed by an adequate
capacity to pay the preferred stock obligations. Whereas it
normally exhibits adequate protection parameters, adverse
economic conditions or changing circumstances are more likely
to lead to a weakened capacity to make payments for a
preferred stock in this category than for issues in the "A"
category.

BB, B, Preferred stocks rated "BB," "B" and "CCC" are regarded, on
CCC balance, as predominantly speculative with respect to the
issuer's capacity to pay preferred stock obligations. "BB"
indicates the lowest degree of speculation and "CCC" the
highest degree of speculation. While such issues will
likely have some quality and protective characteristics, these
are outweighed by large uncertainties or major risk exposures
to adverse conditions.

CC The rating "CC" is reserved for a preferred stock issue in
arrears on dividends or sinking fund payments but that is
currently paying.

C A preferred stock rated "C" is a non-paying issue.

D A preferred stock rated "D" is a non-paying issue with the
issuer in default on debt instruments.

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<PAGE> 71
NR indicates that no rating has been requested, that there is
insufficient information on which to base a rating, or that S&P does not rate a
particular type of obligations as a matter of policy.

PLUS (+) OR MINUS (-) To provide more detailed indications of
preferred stock quality, the ratings from "AA" to "CCC" may be modified by the
addition of a plus or minus sign to show relative standing within the major
rating categories.

The following are excerpts from Moody's description of its preferred
stock ratings:

"aaa" An issue which is rated "aaa" is considered to be a
top-quality preferred stock. This rating indicates good asset
protection and the least risk of dividend impairment within
the universe of preferred stocks.

"aa" An issue which is rated "aa" is considered a high-grade
preferred stock. This rating indicates that there is a
reasonable assurance the earnings and asset protection will
remain relatively well-maintained in the foreseeable future.

"a" An issue which is rated "a" is considered to be an
upper-medium grade preferred stock. While risks are judged to
be somewhat greater than in the "aaa" and "aa" classification,
earnings and asset protection are, nevertheless, expected to
be maintained at adequate levels.

"baa" An issue which is rated "baa" is considered to be a
medium-grade preferred stock, neither high protected nor
poorly secured. Earnings and asset protection appear adequate
at present but may be questionable over any great length of
time.

"ba" An issue which is rated "ba" is considered to have speculative
elements and its future cannot be considered well assured.
Earnings and asset protection may be very moderate and not
well safeguarded during adverse periods. Uncertainty of
position characterizes preferred stocks in this class.

"b" An issue which is rated "b" generally lacks the
characteristics of a desirable investment. Assurance of
dividend payments and maintenance of other terms of the issue
over any long period of time may be small.

"caa" An issue which is rated "caa" is likely to be in arrears on
dividends payments. This rating designation does not purport
to indicate the future status of payments.

"ca" An issue which is rated "ca" is speculative in a high degree
and is likely to be in arrears on dividends with little
likelihood of eventual payments.

"c" This is the lowest rated class of preferred or preference
stock. Issues so rated can be regarded as having extremely
poor prospects of ever attaining any real investment standing.

Moody's applies numerical modifiers 1, 2, and 3 in each rating
classification; the modifier 1 indicates that the security ranks in the higher
end of its generic rating category; the modifier 2 indicates a mid-range
ranking; and the modifier 3 indicates that the issue ranks in the lower end of
its generic rating category.

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<PAGE> 72
For more information contact the Delaware Group at 800-828-5052.

INVESTMENT MANAGER
Delaware Management Company, Inc.
One Commerce Square
Philadelphia, PA 19103

NATIONAL DISTRIBUTOR
Delaware Distributors, L.P.
1818 Market Street
Philadelphia, PA 19103

SHAREHOLDER SERVICING,
DIVIDEND DISBURSING,
ACCOUNTING SERVICES
AND TRANSFER AGENT
Delaware Service Company, Inc.
1818 Market Street
Philadelphia, PA 19103

LEGAL COUNSEL
Stradley, Ronon, Stevens & Young, LLP
One Commerce Square
Philadelphia, PA 19103

INDEPENDENT AUDITORS
Ernst & Young LLP
Two Commerce Square
Philadelphia, PA 19103

CUSTODIAN

The Chase Manhattan Bank
4 Chase Metrotech Center
Brooklyn, NY 11245

___________________________________________

RETIREMENT INCOME FUND

___________________________________________

INSTITUTIONAL
___________________________________________

P R O S P E C T U S

___________________________________________

NOVEMBER 29, 1996

DELAWARE
GROUP

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<PAGE> 73

RETIREMENT INCOME FUND PROSPECTUS
INSTITUTIONAL CLASS SHARES NOVEMBER 29, 1996

_________________________________________________________

1818 MARKET STREET, PHILADELPHIA, PA 19103

FOR MORE INFORMATION ABOUT
THE RETIREMENT INCOME FUND INSTITUTIONAL CLASS
CALL THE DELAWARE GROUP AT 800-828-5052.

This Prospectus describes the Retirement Income Fund Institutional
Class of shares (the "Class") of the Retirement Income Fund series (the "Fund")
of Delaware Group Equity Funds V, Inc. ("Equity Funds V, Inc."), a
professionally-managed mutual fund of the series type. The objective of the
Fund is to seek to provide investors with high current income and the potential
for capital appreciation.

This Prospectus relates only to the Class and sets forth information
that you should read and consider before you invest. Please retain it for
future reference. The Statement of Additional Information ("Part B") for
Equity Funds V, Inc.'s, dated November 29, 1996, as it may be amended from time
to time, contains additional information about the Fund and has been filed with
the Securities and Exchange Commission. Part B is incorporated by reference
into this Prospectus and is available, without charge, by writing to Delaware
Distributors, L.P. at the above address or by calling the above number.

The Fund also offers the Retirement Income Fund A Class of shares, the
Retirement Income Fund B Class of shares and the Retirement Income Fund C Class
of shares. Shares of these classes are subject to sales charges and other
expenses, which may affect their performance. A prospectus for these classes
can be obtained by writing to Delaware Distributors, L.P. at the above address
or by calling 800-523-4640.

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<PAGE> 74

TABLE OF CONTENTS

COVER PAGE 1
SYNOPSIS 3
SUMMARY OF EXPENSES 5
INVESTMENT OBJECTIVE AND POLICIES 7
SUITABILITY 7
INVESTMENT STRATEGY 7
SPECIAL RISK CONSIDERATIONS 13
HIGH-YIELD SECURITIES 13
LOWER RATED CONVERTIBLE SECURITIES
AND PREFERRED STOCK 14
FOREIGN SECURITIES 14
CLASSES OF SHARES 17
HOW TO BUY SHARES 18
REDEMPTION AND EXCHANGE 20
DIVIDENDS AND DISTRIBUTIONS 23
TAXES 24
CALCULATION OF NET ASSET
VALUE PER SHARE 26
MANAGEMENT OF THE FUND 27
OTHER INVESTMENT POLICIES AND
RISK CONSIDERATIONS 31
APPENDIX A--RATINGS 38

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<PAGE> 75

SYNOPSIS

RISK FACTORS
Prospective investors should consider the following:

1. The Fund has the authority to invest up to all of its net
assets in lower rated securities. Up to 45% of its net assets may be invested
in high-yield, higher risk fixed-income securities ("junk bonds"). In
addition, the Fund may invest in certain income generating equity securities
such as convertible securities and preferred stock, rated below investment
grade. These securities generally will have speculative characteristics
similar to those of lower rated fixed-income securities. The Fund may invest
an unrestricted portion of its total assets in such lower rated income
generating equity securities. Such securities may increase the risks of an
investment in this Fund. See High-Yield Securities under Special Risk
Considerations.

INVESTMENT MANAGER, DISTRIBUTOR AND SERVICE AGENT

Delaware Management Company, Inc. (the "Manager") furnishes investment
management services to the Fund, subject to the supervision and direction of
Equity Funds V, Inc.'s Board of Directors. The Manager also provides
investment management services to certain other funds in the Delaware Group.

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<PAGE> 76

Delaware Distributors, L.P. (the "Distributor") is the national distributor for
the Fund and for all of the other mutual funds in the Delaware Group. Delaware
Service Company, Inc. (the "Transfer Agent") is the shareholder servicing,
dividend disbursing, accounting services and transfer agent for the Fund and
for all of the other mutual funds in the Delaware Group. See Summary of
Expenses and Management of the Fund for other information regarding the Manager
and the fees payable under the Fund's Investment Management Agreement.

PURCHASE PRICE
Shares of the Class offered by this Prospectus are available at net
asset value, without a front-end or contingent deferred sales charge, and are
not subject to distribution fees under a Rule 12b-1 distribution plan. See
Classes of Shares.

REDEMPTION AND EXCHANGE
Shares of the Class are redeemed or exchanged at the net asset value
calculated after receipt of the redemption or exchange request. See Redemption
and Exchange.

OPEN-END INVESTMENT COMPANY

Equity Funds V, Inc., which was organized as a Maryland corporation in
1987, is an open-end management investment company. The Fund's portfolio of
assets is diversified as defined by the Investment Company Act of 1940 (the
"1940 Act"). See Shares under Management of the Fund.

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<PAGE> 77

SUMMARY OF EXPENSES

SHAREHOLDER TRANSACTION EXPENSES
- -------------------------------------------------------------------------------
Maximum Sales Charge Imposed on Purchases
(as a percentage of offering price). . . . . None

Maximum Sales Charge Imposed on
Reinvested Dividends (as a
percentage of offering price). . . . . . . . None

Redemption Fees . . . . . . . . . . . . . . . . . . . None*

Exchange Fees . . . . . . . . . . . . . . . . . . . . None**

ANNUAL OPERATING EXPENSES
(AS A PERCENTAGE OF AVERAGE DAILY NET ASSETS)
- -------------------------------------------------------------------------------
Management Fees (after voluntary waivers) . . . . . . 0.00%

12b-1 Fees. . . . . . . . . . . . . . . . . . . . . . None

Other Operating Expenses+ . . . . . . . . . . . . . . 0.75%
======
Total Operating Expenses+
(after voluntary waivers) . . . . . . 0.75%
======

Because the Fund has no operating history, "Other Operating Expenses"
are estimated based on expenses expected to be incurred during the Fund's first
fiscal year.

*CoreStates Bank, N.A. currently charges $7.50 per redemption for redemptions
payable by wire.

**Exchanges are subject to the requirements of each fund and a front-end sales
charge may apply.

+"Total Operating Expenses" and "Other Operating Expenses" for the Class are
based on estimated amounts for the first full fiscal year of the Class, after
giving effect to the voluntary expense waiver. The Manager has elected
voluntarily to waive that portion, if any, of the annual management fees
payable by the Fund and to pay certain expenses of the Fund to the extent
necessary to ensure that the "Total Operating Expenses" of the Class do not
exceed 0.75% during the commencement of the public offering of the Class
through May 31, 1997. If the voluntary expense waivers were not in effect, it
is estimated that the "Total Operating Expenses," as a percentage of average
daily net assets, would be 2.26% for the Class' first full fiscal year,
reflecting management fees of 0.65%.

For expense information about Retirement Income Fund A Class,
Retirement Income Fund B Class and Retirement Income Fund C Class, see the
separate prospectus relating to those classes.

-5-
<PAGE> 78

The following example illustrates the expenses that an investor would
pay on a $1,000 investment over various time periods, assuming (1) a 5% annual
rate of return, and (2) redemption at the end of each time period. As noted in
the table above, the Fund charges no redemption fees.

<TABLE>
<CAPTION>
1 YEAR 3 YEARS
------ -------
<S> <C>
$8 $24
</TABLE>

The purpose of the above tables is to assist the investor in understanding the
various costs and expenses that an investor in the Class will bear directly or
indirectly.

THIS EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES OR PERFORMANCE. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE
SHOWN.

-6-
<PAGE> 79

INVESTMENT OBJECTIVE AND POLICIES

SUITABILITY

The types of securities in which the Fund may invest are subject to
price fluctuations particularly due to changes in interest rates. Investors
should consider asset value fluctuation, as well as yield, in making an
investment decision. While investments in unrated, lower- rated and certain
restricted securities have the potential for higher yields, they are more
speculative and increase the credit risk of the Fund's portfolio. Changes in
the market value of portfolio securities will not affect interest income from
such securities, but will be reflected in the Class' net asset value. In
addition, investments in foreign securities involve special risks, including
those related to currency fluctuations, as well as to political, economic and
social situations different from and potentially more volatile than those in
the United States. Investors should be willing to accept the risks, including
the risk of net asset value fluctuations, associated with investing in these
types of securities. See Special Risk Considerations and Other Investment
Policies and Risk Considerations for a complete discussion of the risk factors
affecting the Fund's portfolio securities.

Ownership of Fund shares can reduce the bookkeeping and administrative
inconveniences that would be connected with direct purchases of the types of
securities in which the Fund invests.

-7-
<PAGE> 80

investment grade fixed-income securities, U.S. government securities and
foreign equity and fixed-income securities. Under normal circumstances, at
least 50% of the Fund's total assets will be invested in income generating
equity securities. In making investments in income generating equity
securities, the Fund may invest an unrestricted portion of its total assets in
convertible securities and preferred stock rated below investment grade. While
debt securities may comprise up to 50% of the Fund's total assets, no more than
45% of the Fund's total assets will be invested in high-yield, high risk debt
securities. No more than 25% of the Fund's total assets will be invested in
any one industry sector nor, as to 75% of the Fund's total assets, will more
than 5% be invested in securities of any one issuer. The Fund may invest up to
20% of its total assets in foreign equity and debt securities. The Fund will
not, however, invest more than 5% of its total assets in securities of issuers
principally located or principally operating in markets of emerging countries.

The following is a more detailed description of some of the securities
in which the Fund may invest.

-8-
<PAGE> 81

CONVERTIBLE SECURITIES
Traditional convertible securities include corporate bonds, notes and
preferred stocks that may be converted into or exchanged for common stock, and
other securities that also provide an opportunity for equity participation.
These securities are generally convertible either at a stated price or a stated
rate (that is, for a specific number of shares of common stock or other
security). As with other fixed- income securities, the price of a convertible
security to some extent varies inversely with interest rates. While providing
a fixed-income stream (generally higher in yield than the income derivable from
a common stock but lower than that afforded by a non-convertible debt
security), a convertible security also affords the investor an opportunity,
through its conversion feature, to participate in the capital appreciation of
the common stock into which it is convertible. As the market price of the
underlying common stock declines, convertible securities tend to trade
increasingly on a yield basis and so may not experience market value declines
to the same extent as the underlying common stock. When the market price of
the underlying common stock increases, the price of a convertible security
tends to rise as a reflection of the value of the underlying common stock. To
obtain such a higher yield, the Fund may be required to pay for a convertible
security an amount in excess of the value of the underlying common stock.
Common stock acquired by the Fund upon conversion of a convertible security
will generally be held for so long as the Manager anticipates such stock will
provide the Fund with opportunities which are consistent with the Fund's
investment objectives and policies. Convertible securities in which the Fund
may invest may be rated below investment grade (i.e., "Ba" or lower by Moody's
or "BB" or lower by S&P or similarly rated by other comparable rating agencies)
or, if unrated, determined to be of comparable quality by the Manager.

REAL ESTATE INVESTMENT TRUST SECURITIES

-9-
<PAGE> 82

HIGH-YIELD, HIGH RISK SECURITIES
DEBT SECURITIES
High-yield, high risk debt securities, like all debt securities,
represent money borrowed that must be repaid and has a fixed amount, a specific
maturity or maturities and usually a specific rate of interest or original
purchase discount. Unlike common and preferred stock, debt securities,
including high-yield, high risk debt securities, do not represent an equity
interest in the issuer. However, debt securities have a priority claim over
stockholders if the issuer is liquidated. The Fund may invest in a wide
variety of debt securities, although it is anticipated that under normal market
conditions, the Fund primarily will invest in high-yield corporate debt
obligations, including zero coupon bonds and pay-in-kind securities ("PIKs"),
debentures, convertible debentures, corporate notes (including convertible
notes) and units consisting of bonds with stock or warrants to buy stock
attached. See Zero Coupon Bonds and Pay-In-Kind Bonds under Other Investment
Policies and Risk Considerations.

The Fund will invest in both rated and unrated bonds. The rated bonds
that the Fund may purchase in this sector of its portfolio will be rated BBB or
lower by S&P or Fitch Investors Service, Inc. ("Fitch"), Baa or lower by
Moody's, or similarly rated by another nationally recognized statistical rating
organization. See Appendix A to this Prospectus for more rating information
and High-Yield Securities under Special Risk Considerations for a description
of the risks associated with investing in lower-rated fixed-income securities.
Unrated bonds may be more speculative in nature than rated bonds.

-10-
<PAGE> 83

issued by a foreign corporation. "Sponsored" Depositary Receipts are issued
jointly by the issuer of the underlying security and a depository, and
"unsponsored" Depositary Receipts are issued without the participation of the
issuer of the deposited security. The Fund may also invest in Brady Bonds,
which are described more fully under the Other Investment Policies and Risk
Considerations section of this Prospectus.

The Fund will invest in both rated and unrated foreign securities.
The rated securities that the Fund may purchase in the international sector of
its portfolio may include those rated BBB or lower by S&P or Fitch, Baa or
lower by Moody's, or similarly rated by another nationally reorganized
statistical rating organization. See Appendix A to this Prospectus for more
rating information and Foreign Securities and High-Yield Securities under
Special Risk Considerations for a description of the risks associated with
investing in foreign securities and lower-rated securities.

* * *

For a description of the Fund's other investment policies and for a
further description of some of the policies described above, see Other
Investment Policies and Risk Considerations.

-11-
<PAGE> 84

Although the Fund will constantly strive to attain its objective,
there can be no assurance that it will be attained.

The remaining investment policies of the Fund not identified above or
in Part B are not fundamental and may be changed by the Board of Directors of
Equity Funds V, Inc. without a shareholder vote.

-12-
<PAGE> 85

SPECIAL RISK CONSIDERATIONS

HIGH-YIELD SECURITIES

The Fund may invest up to 45% of its total assets in bonds rated BBB
or lower by S&P or Fitch, Baa or lower by Moody's, or similarly rated by
another rating organization, and in unrated corporate bonds. See Appendix A to
this Prospectus for more rating information. Investing in these so-called
"junk" or "high-yield" bonds entails certain risks, including the risk of loss
of principal and default on interest payments, which may be greater than the
risks involved in investment grade bonds, and which should be considered by
investors contemplating an investment in the Fund. Such bonds are sometimes
issued by companies whose earnings at the time of issuance are less than the
projected debt service on the junk bonds. In addition to the considerations
discussed elsewhere in this Prospectus, those risks include the following:

-13-
<PAGE> 86

Liquidity and Valuation. The secondary market for high-yield securities is
currently dominated by institutional investors, including mutual funds, and
certain financial institutions. There is generally no established retail
secondary market for high-yield securities. As a result, the secondary market
for high-yield securities is more limited and less liquid than other secondary
securities markets. The high-yield secondary market is particularly
susceptible to liquidity problems when the institutions that dominate it
temporarily cease buying bonds for regulatory, financial or other reasons, such
as the savings and loan crisis. A less liquid secondary market may have an
adverse effect on the Fund's ability to dispose of particular issues, when
necessary, to meet the Fund's liquidity needs or in response to a specific
economic event, such as the deterioration in the creditworthiness of the
issuer. In addition, a less liquid secondary market makes it more difficult
for the Fund to obtain precise valuations of the high-yield securities in its
portfolio. During periods involving such liquidity problems, judgment plays a
greater role in valuing high-yield securities than is normally the case. The
secondary market for high-yield securities is also generally considered to be
more likely to be disrupted by adverse publicity and investor perceptions than
the more established secondary securities markets. The privately placed
high-yield securities that the Fund may purchase are particularly susceptible
to the liquidity and valuation risks outlined above.

LOWER RATED CONVERTIBLE SECURITIES AND PREFERRED STOCK

The Fund may invest in lower rated convertible securities and
preferred stock (i.e., "Ba" or lower for convertible securities or "ba" or
lower for preferred stock by Moody's or "BB" or lower for convertible
securities or preferred stock by S&P or similarly rated by other comparable
rating agencies) or, if unrated, determined to be of comparable quality by the
Manager. Investing in lower rated convertible securities and preferred stock
entails certain risks, including the risk of loss of principal which may be
greater than the risks involved in investing in higher rated securities, and
which should be considered by investors contemplating an investment in the
Fund. The Fund may have difficulty disposing of such securities because the
trading market for such securities may be thinner than the market for higher
rated convertible securities and preferred stock. To the extent a secondary
trading market for these securities does exist, it generally is not as liquid
as the secondary trading market for higher rated securities. The lack of a
liquid secondary market as well as adverse publicity with respect to these
securities, may have an adverse impact on market price and the Fund's ability
to dispose of particular issues in response to a specific economic event such
as a deterioration in the creditworthiness of the issuer. The lack of a liquid
secondary market for certain securities also may make it more difficult for the
Fund to obtain accurate market quotations for purposes of pricing the Fund's
portfolio and calculating its net asset value. The market behavior of
convertible securities and preferred stocks in lower rating categories is often
more volatile than that of higher quality securities. Lower quality
convertible securities and preferred stocks are judged by Moody's and S&P to
have speculative elements or characteristics; their future cannot be considered
as well assured and earnings and asset protection may be moderate or poor in
comparison to investment grade securities. In addition, such lower quality
securities face major ongoing uncertainties or exposure to adverse business,
financial or economic conditions, which could lead to inadequate capacity to
meet timely payments. A description of the ratings used by Moody's and S&P for
such securities is set forth in Appendix A to this Prospectus. See also
Special Risk Considerations--High-Yield Securities."

FOREIGN SECURITIES
The Fund has the ability to purchase income generating equity
securities and debt securities in any foreign country. Investors should
consider carefully the substantial risks involved in investing in securities
issued by companies and governments of foreign nations. These risks are in
addition to the usual risks

-14-
<PAGE> 87

inherent in domestic investments. There is the possibility of expropriation,
nationalization or confiscatory taxation, taxation of income earned in foreign
nations or other taxes imposed with respect to investments in foreign nations,
foreign exchange controls (which may include suspension of the ability to
transfer currency from a given country), default in foreign government
securities, political or social instability or diplomatic developments which
could affect investments in securities of issuers in those nations.

-15-
<PAGE> 88

include, but are not limited to, a country's cash flow situation, the
availability of sufficient foreign exchange on the date a payment is due, the
relative size of its debt service burden to the economy as a whole, its
government's policy towards the International Monetary Fund, the World Bank and
other international agencies and the political constraints to which a
government debtor may be subject. The Manager currently considers countries
such as Argentina, Brazil, Chile, China, Mexico, India, Portugal, Poland and
Thailand to be emerging markets. This list is not intended to be exhaustive,
but rather representative of the types of countries now considered by the
Manager to present special investment risks.

-16-
<PAGE> 89

CLASSES OF SHARES

The Distributor serves as the national distributor for the Fund.
Shares of the Class may be purchased directly by contacting the Fund or its
agent or through authorized investment dealers. All purchases of shares of the
Class are at net asset value. There is no front-end or contingent deferred
sales charge.

INVESTMENT INSTRUCTIONS GIVEN ON BEHALF OF PARTICIPANTS IN AN
EMPLOYER-SPONSORED RETIREMENT PLAN ARE MADE IN ACCORDANCE WITH DIRECTIONS
PROVIDED BY THE EMPLOYER. EMPLOYEES CONSIDERING PURCHASING SHARES OF THE CLASS
AS PART OF THEIR RETIREMENT PROGRAM SHOULD CONTACT THEIR EMPLOYER FOR DETAILS.

Shares of the Class are available for purchase only by: (a)
retirement plans introduced by persons not associated with brokers or dealers
that are primarily engaged in the retail securities business and rollover
individual retirement accounts from such plans; (b) tax- exempt employee
benefit plans of the Manager or its affiliates and securities dealer firms with
a selling agreement with the Distributor; (c) institutional advisory accounts
of the Manager or its affiliates and those having client relationships with
Delaware Investment Advisers, a division of the Manager, or its affiliates and
their corporate sponsors, as well as subsidiaries and related employee benefit
plans and rollover individual retirement accounts from such institutional
advisory accounts; (d) banks, trust companies and similar financial
institutions investing for their own account or for the account of their trust
customers for whom such financial institution is exercising investment
discretion in purchasing shares of the Class; and (e) registered investment
advisers investing on behalf of clients that consist solely of institutions and
high net-worth individuals having at least $1,000,000 entrusted to the adviser
for investment purposes, but only if the adviser is not affiliated or
associated with a broker or dealer and derives compensation for its services
exclusively from its clients for such advisory services.

RETIREMENT INCOME FUND A CLASS, RETIREMENT INCOME FUND B CLASS AND RETIREMENT
INCOME FUND C CLASS

In addition to offering the Retirement Income Fund Institutional
Class, the Fund also offers the Retirement Income Fund A Class, the Retirement
Income Fund B Class and the Retirement Income Fund C Class, which are described
in a separate prospectus. Shares of the Retirement Income Fund A Class, the
Retirement Income Fund B Class and the Retirement Income Fund C Class may be
purchased through authorized investment dealers or directly by contacting the
Fund or its Distributor. The Retirement Income Fund A Class carries a
front-end sales charge and, absent any applicable fee waiver, has annual 12b-1
expenses equal to a maximum of 0.30%. The maximum front-end sales charge as a
percentage of the offering price is 4.75% and is reduced on certain
transactions of $100,000 or more. The Retirement Income Fund B Class and the
Retirement Income Fund C Class have no front-end sales charge but, absent any
applicable fee waiver, are subject to annual 12b-1 expenses equal to a maximum
of 1%. Shares of the Retirement Income Fund B Class and the Retirement Income
Fund C Class and certain shares of the Retirement Income Fund A Class may be
subject to a contingent deferred sales charge upon redemption. To obtain a
prospectus relating to such classes, contact the Distributor by writing to the
address or by calling the phone numbers listed on the cover of this Prospectus.

-17-
<PAGE> 90

HOW TO BUY SHARES
The Fund makes it easy to invest by mail, by wire, by exchange and by
arrangement with your investment dealer. In all instances, investors must
qualify to purchase shares of the Class.

INVESTING DIRECTLY BY MAIL
1. Initial Purchases--An Investment Application, or in the case of a
retirement account, an appropriate retirement plan application, must be
completed, signed and sent with a check payable to Retirement Income Fund
Institutional Class, to Delaware Group at 1818 Market Street, Philadelphia, PA
19103.

2. Subsequent Purchases--Additional purchases may be made at any time by
mailing a check payable to Retirement Income Fund Institutional Class. Your
check should be identified with your name(s) and account number.

INVESTING DIRECTLY BY WIRE

You may purchase shares by requesting your bank to transmit funds by
wire to CoreStates Bank, N.A., ABA #031000011, account number 1412893401
(include your name(s) and your account number).

1. Initial Purchases--Before you invest, telephone the Fund's Client
Services Department at 800-828-5052 to get an account number. If you do not
call first, it may delay processing your investment. In addition, you must
promptly send your Investment Application, or in the case of a retirement
account, an appropriate retirement plan application, to Retirement Income Fund
Institutional Class, to Delaware Group at 1818 Market Street, Philadelphia, PA
19103.

2. Subsequent Purchases--You may make additional investments anytime by
wiring funds to CoreStates Bank, N.A., as described above. You must advise
your Client Services Representative by telephone at 800-828-5052 prior to
sending your wire.

INVESTING BY EXCHANGE
If you have an investment in another mutual fund in the Delaware Group
and you qualify to purchase shares of the Class, you may write and authorize an
exchange of part or all of your investment into the Fund. However, shares of
the Retirement Income Fund B Class and Retirement Income Fund C Class and the
Class B Shares and Class C Shares of the other funds in the Delaware Group
offering such a class of shares may not be exchanged into the Class. If you
wish to open an account by exchange, call your Client Services Representative
at 800-828- 5052 for more information.

INVESTING THROUGH YOUR INVESTMENT DEALER
You can make a purchase of Fund shares through most investment dealers
who, as part of the service they provide, must transmit orders promptly. They
may charge for this service.

PURCHASE PRICE AND EFFECTIVE DATE
The purchase price (net asset value) is determined as of the close of
regular trading on the New York Stock Exchange (ordinarily, 4 p.m., Eastern
time) on days when the Exchange is open.

-18-
<PAGE> 91

The effective date of a purchase made through an investment dealer is
the date the order is received by the Fund. The effective date of a direct
purchase is the day your wire, electronic transfer or check is received, unless
it is received after the time the share price is determined, as noted above.
Purchase orders received after such time will be effective the next business
day.

THE CONDITIONS OF YOUR PURCHASE
The Fund reserves the right to reject any purchase order. If a
purchase is canceled because your check is returned unpaid, you are responsible
for any loss incurred. The Fund can redeem shares from your account(s) to
reimburse itself for any loss, and you may be restricted from making future
purchases in any of the funds in the Delaware Group. The Fund reserves the
right to reject purchase orders paid by third- party checks or checks that are
not drawn on a domestic branch of a United States financial institution. If a
check drawn on a foreign financial institution is accepted, you may be subject
to additional bank charges for clearance and currency conversion.

The Fund also reserves the right, upon 60 days' written notice, to
involuntarily redeem accounts that remain under $250 as a result of
redemptions.

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<PAGE> 92

REDEMPTION AND EXCHANGE

REDEMPTION AND EXCHANGE REQUESTS MADE ON BEHALF OF PARTICIPANTS IN AN
EMPLOYER-SPONSORED RETIREMENT PLAN ARE MADE IN ACCORDANCE WITH DIRECTIONS
PROVIDED BY THE EMPLOYER. EMPLOYEES SHOULD THEREFORE CONTACT THEIR EMPLOYER
FOR DETAILS.

Your shares will be redeemed or exchanged based on the net asset value
next determined after we receive your request in good order. Redemption and
exchange requests received in good order after the time the net asset value of
shares is determined, as noted above, will be processed on the next business
day. See Purchase Price and Effective Date under How to Buy Shares. Except as
otherwise noted below, for a redemption request to be in "good order," you must
provide your account number, account registration, and the total number of
shares or dollar amount of the transaction. With regard to exchanges, you must
also provide the name of the fund you want to receive the proceeds. Exchange
instructions and redemption requests must be signed by the record owner(s)
exactly as the shares are registered. You may request a redemption or an
exchange by calling the Fund at 800-828-5052. Redemption proceeds will be
distributed promptly, as described below, but not later than seven days after
receipt of a redemption request.

The Fund will process written and telephone redemption requests to the
extent that the purchase orders for the shares being redeemed have already
settled. The Fund will honor redemption requests as to shares for which a
check was tendered as payment, but the Fund will not mail or wire the proceeds
until it is reasonably satisfied that the check has cleared, which may take up
to 15 days from the purchase date. You can avoid this potential delay if you
purchase shares by wiring Federal Funds. The Fund reserves the right to reject
a written or telephone redemption request or delay payment of redemption
proceeds if there has been a recent change to the shareholder's address of
record.

Shares of the Class may be exchanged into any other Delaware Group
mutual fund, provided: (1) the investment satisfies the eligibility and other
requirements set forth in the prospectus of the fund being acquired, including
the payment of any applicable front-end sales charge; and (2) the shares of the
fund being acquired are in a state where that fund is registered. If exchanges
are made into other shares that are eligible for purchase only by those
permitted to purchase shares of the Class, such exchange will be exchanged at
net asset value. Shares of the Class may not be exchanged into the Class B
Shares or Class C Shares of the funds in the Delaware Group. The Fund may
suspend, terminate or amend the terms of the exchange privilege upon 60 days'
written notice to shareholders.

Various redemption and exchange methods are outlined below. No fee is
charged by the Fund or the Distributor for redeeming or exchanging your shares.
You may also have your investment dealer arrange to have your shares redeemed
or exchanged. Your investment dealer may charge for this service.

All authorizations, including selection of any of the features
described below, shall continue in effect until such time as a written
revocation or modification has been received by the Fund or its agent.

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<PAGE> 93

WRITTEN REDEMPTION AND EXCHANGE
You can write to the Fund at 1818 Market Street, Philadelphia, PA
19103 to redeem some or all of your shares or to request an exchange of any or
all of your shares into another mutual fund in the Delaware Group, subject to
the same conditions and limitations as other exchanges noted above. The
request must be signed by all owners of the account or your investment dealer
of record.

For redemptions of more than $50,000, or when the proceeds are not
sent to the shareholder(s) at the address of record, the Fund requires a
signature by all owners of the account and may require a signature guarantee.
Each signature guarantee must be supplied by an eligible guarantor institution.
The Fund reserves the right to reject a signature guarantee supplied by an
eligible institution based on its creditworthiness. The Fund may require
further documentation from corporations, executors, retirement plans,
administrators, trustees or guardians.

Payment is normally mailed the next business day after receipt of your
redemption request. Certificates are issued for shares only if you submit a
specific request. If your shares are in certificate form, the certificate must
accompany your request and also be in good order.

You also may submit your written request for redemption or exchange by
facsimile transmission at the following number: 215-255-8864.

TELEPHONE REDEMPTION AND EXCHANGE
To get the added convenience of the telephone redemption and exchange
methods, you must have the Transfer Agent hold your shares (without charge) for
you. If you choose to have your shares in certificate form, you may redeem or
exchange only by written request and you must return your certificates.

The Telephone Redemption--Check to Your Address of Record service and
the Telephone Exchange service, both of which are described below, are
automatically provided unless you notify the Fund in writing that you do not
wish to have such service available with respect to your account. The Fund
reserves the right to modify, terminate or suspend these procedures upon 60
days' written notice to shareholders. It may be difficult to reach the Fund by
telephone during periods when market or economic conditions lead to an
unusually large volume of telephone requests.

Neither the Fund nor its Transfer Agent is responsible for any
shareholder loss incurred in acting upon written or telephone instructions for
redemption or exchange of Fund shares which are reasonably believed to be
genuine. With respect to such telephone transactions, the Fund will follow
reasonable procedures to confirm that instructions communicated by telephone
are genuine (including verification of a form of personal identification) as,
if it does not, the Fund or the Transfer Agent may be liable for any losses due
to unauthorized or fraudulent transactions. A written confirmation will be
provided for all purchase, exchange and redemption transactions initiated by
telephone. By exchanging shares by telephone, you are acknowledging prior
receipt of a prospectus for the fund into which your shares are being
exchanged.

TELEPHONE REDEMPTION--CHECK TO YOUR ADDRESS OF RECORD
You or your investment dealer of record can have redemption proceeds
of $50,000 or less mailed to you at your record address. Checks will be
payable to the shareholder(s) of record. Payment is normally mailed the next
business day after receipt of the redemption request.

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<PAGE> 94

TELEPHONE REDEMPTION--PROCEEDS TO YOUR BANK

Redemption proceeds of $1,000 or more can be transferred to your
predesignated bank account by wire or by check. You should authorize this
service when you open your account. If you change your predesignated bank
account, you must submit a written authorization and you may need to have your
signature guaranteed. For your protection, your authorization must be on file.
If you request a wire, your funds will normally be sent the next business day.
CoreStates Bank, N.A.'s fee (currently $7.50) will be deducted from your
redemption. If you ask for a check, it will normally be mailed the next
business day after receipt of your redemption request to your predesignated
bank account. There are no fees for this redemption method, but the mail time
may delay getting funds into your bank account. Simply call your Client
Services Representative prior to the time the net asset value is determined, as
noted above.

TELEPHONE EXCHANGE
You or your investment dealer of record can exchange shares into any
fund in the Delaware Group under the same registration. As with the written
exchange service, telephone exchanges are subject to the same conditions and
limitations as other exchanges noted above. Telephone exchanges may be subject
to limitations as to amounts or frequency.

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<PAGE> 95

DIVIDENDS AND DISTRIBUTIONS

The Fund expects to declare and pay dividends monthly. However, the
Fund does not anticipate declaring or paying dividends during the first few
months following the commencement of its operations. Distributions from net
realized securities profits, if any, will be distributed twice a year. The
first payment normally would be made during the first quarter of the next
fiscal year. The second payment would be made near the end of the calendar
year to comply with certain requirements of the Internal Revenue Code (the
"Code"). Both dividends and distributions are automatically reinvested in your
account at net asset value.

Each Class of the Fund will share proportionately in the investment
income and expenses of the Fund, except that the Class will not incur
distribution fees under the Rule 12b-1 Plans which, absent any applicable fee
waiver, apply to the Retirement Income Fund A Class, the Retirement Income Fund
B Class and the Retirement Income Fund C Class.

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<PAGE> 96

TAXES

The Fund intends to distribute substantially all of its net investment
income and net capital gains, if any. Dividends from net investment income or
net short-term capital gains will be taxable to investors who are subject to
income tax as ordinary income, even though received in additional shares. It
is expected that only a nominal portion of the Fund's dividends will be
eligible for the dividends-received deduction for corporations.

Distributions paid by the Fund from long-term capital gains, received
in additional shares, are taxable to those investors who are subject to income
taxes as long-term capital gains, regardless of the length of time an investor
has owned shares in the Fund. The Fund does not seek to realize any particular
amount of capital gains during a year; rather, realized gains are a byproduct
of Fund management activities. Consequently, capital gains distributions may
be expected to vary considerably from year to year. Also, for those investors
subject to tax, if purchases of shares in the Fund are made shortly before the
record date for a dividend or capital gains distribution, a portion of the
investment will be returned as a taxable distribution.

The Fund may be subject to foreign withholding taxes on income from
certain of its foreign securities.

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<PAGE> 97

See Accounting and Tax Issues and Taxes in Part B for additional
information on tax matters relating to the Fund and its shareholders.

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<PAGE> 98

CALCULATION OF NET ASSET VALUE PER SHARE

The purchase and redemption price of Class shares is the net asset
value ("NAV") per share of the Class next computed after the order is received.
The NAV is computed as of the close of regular trading on the New York Stock
Exchange (ordinarily, 4 p.m., Eastern time) on days when the Exchange is open.

The NAV is computed by adding the value of all securities and other
assets in the portfolio, deducting any liabilities (expenses and fees are
accrued daily) and dividing by the number of shares outstanding. Portfolio
securities for which market quotations are available are priced at market
value. Foreign securities expressed in foreign currency values will be
converted into U.S. dollar values at the mean between the currencies' bid and
offered quotations. Debt securities are priced on the basis of valuations
provided by an independent pricing service using methods approved by Equity
Funds V, Inc.'s Board of Directors. Short-term investments having a maturity
of less than 60 days are valued at amortized cost, which approximates market
value. All other securities are valued at their fair value as determined in
good faith and in a method approved by Equity Funds V, Inc.'s Board of
Directors.

The net asset values of all outstanding shares of each class of the
Fund will be computed on a pro-rata basis for each outstanding share based on
the proportionate participation in the Fund represented by the value of shares
of that class. All income earned and expenses incurred by the Fund will be
borne on a pro-rata basis by each outstanding share of a class, based on each
class' percentage in the Fund represented by the value of shares of such
classes, except that the Class will not incur any of the expenses under the
Fund's 12b-1 Plans and the Retirement Income Fund A, B and C Classes alone will
bear the 12b-1 Plan fees payable under their respective Plans.

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<PAGE> 99

MANAGEMENT OF THE FUND

DIRECTORS

INVESTMENT MANAGER
The Manager furnishes investment management services to the Fund.

The Manager and its predecessors have been managing the funds in the
Delaware Group since 1938. On September 30, 1996, the Manager and its
affiliates within the Delaware Group, including Delaware International Advisers
Ltd., were supervising in the aggregate more than $30 billion in assets in the
various institutional or separately managed (approximately $18,573,058,000) and
investment company (approximately $11,495,414,000) accounts.

The Manager manages the Fund's portfolio and makes investment
decisions for the Fund, which are implemented by the Fund's Trading Department.
The Manager also administers Equity Funds V, Inc.'s affairs and pays the
salaries of all the directors, officers and employees of Equity Funds V, Inc.
who are affiliated with the Manager. For these services, the Manager is paid
an annual fee equal to 0.65% on the first $500 million of average daily net
assets, 0.625% on the next $500 million and 0.60% on the average daily net
assets in excess of $1 billion.

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<PAGE> 100

PORTFOLIO TRADING PRACTICES
The Fund normally will not invest for short-term trading purposes.
However, the Fund may sell securities without regard to the length of time they
have been held. The degree of portfolio activity will affect brokerage costs
of the Fund and may affect taxes payable by the Fund's shareholders. Given the
Fund's investment objective, its annual portfolio turnover rate is not expected
to exceed 100%. A turnover rate of 100% would occur if all the investments in
the Fund's portfolio at the beginning of the year were replaced by the end of
the year.

PERFORMANCE INFORMATION
From time to time, the Fund may quote yield or total return
performance of the Class in advertising and other types of literature.

The current yield for the Class will be calculated by dividing the
annualized net investment income earned by the Class during a recent 30-day
period by the net asset value per share on the last day of the period. The
yield formula provides for semi-annual compounding, which assumes that net
investment income is earned and reinvested at a constant rate and annualized at
the end of a six-month period.

Total return will be based on a hypothetical $1,000 investment,
reflecting the reinvestment of all distributions. Each presentation will
include the average annual total return for one-, five- and ten-year periods or
life-of-fund, as relevant. The Fund may also advertise aggregate and average
total return information concerning the Class over additional periods of time.

Yield and net asset value fluctuate and are not guaranteed. Past
performance is not a guarantee of future results.

FINANCIAL INFORMATION ABOUT THE FUND

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<PAGE> 101

DISTRIBUTION AND SERVICE

The Distributor, Delaware Distributors, L.P., serves as the national
distributor of the Fund's shares under a Distribution Agreement with Equity
Funds V, Inc. dated as of November 29, 1996. The Distributor bears all of the
costs of promotion and distribution.

The Transfer Agent, Delaware Service Company, Inc., serves as the
shareholder servicing, dividend disbursing and transfer agent for the Fund
under an amended and restated agreement dated as of November 29, 1996. The
Transfer Agent also provides accounting services to the Fund pursuant to the
terms of a separate Fund Accounting Agreement. The directors annually review
service fees paid to the Transfer Agent. Certain recordkeeping and other
shareholder services that otherwise would be performed by the Transfer Agent
may be performed by certain other entities and the Transfer Agent may elect to
enter into an agreement to pay such other entities for their services. In
addition, participant account maintenance fees may be assessed for certain
recordkeeping provided as part of retirement plan and administration service
packages. These fees are based on the number of participants in the plan and
the various services selected. Fees will be quoted upon request and are
subject to change.

The Distributor and the Transfer Agent are also indirect, wholly owned
subsidiaries of DMH.

Equity Funds V, Inc.'s shares have a par value of $.01, equal voting
rights, except as noted below, and are equal in all other respects. Equity
Funds V, Inc.'s shares have noncumulative voting rights which means that the
holders of more than 50% of Equity Funds V, Inc.'s shares voting for the
election of directors can elect 100% of the directors if they choose to do so.
Under Maryland law, Equity Funds V, Inc. is not required, and does not intend,
to hold annual meetings of shareholders unless, under certain circumstances, it
is required to do so under the 1940 Act. Shareholders of 10% or more of Equity
Funds V, Inc.'s outstanding shares may request that a special meeting be called
to consider the removal of a director.

In addition to the Class, the Fund also offers the Retirement Income
Fund A Class, the Retirement Income Fund B Class and the Retirement Income Fund
C Class. Shares of each class represent

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<PAGE> 102

proportionate interests in the assets of the Fund and have the same voting and
other rights and preferences as the other classes of the Fund, except that
shares of the Class are not subject to, and may not vote on matters affecting,
the Distribution Plans under Rule 12b-1 relating to the Retirement Income Fund
A Class, the Retirement Income Fund B Class and the Retirement Income Fund C
Class.

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<PAGE> 103

OTHER INVESTMENT POLICIES AND RISK CONSIDERATIONS

BRADY BONDS

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<PAGE> 104

should recognize that the Brady Plan only sets forth general guiding principles
for economic reform and debt reduction, emphasizing that solutions must be
negotiated on a case-by-case basis between debtor nations and their creditors.
In addition, Brady Bonds have been issued only recently and, accordingly, do
not have a long payment history.

ZERO COUPON BONDS AND PAY-IN-KIND BONDS
Although the Fund does not intend to purchase a substantial amount of
zero coupon bonds or PIK bonds, from time to time, the Fund may acquire zero
coupon bonds and, to a lesser extent, PIK bonds. Zero coupon bonds are debt
obligations which do not entitle the holder to any periodic payments of
interest prior to maturity or a specified date when the securities begin paying
current interest, and therefore are issued and traded at a discount from their
face amounts or par value. PIK bonds pay interest through the issuance to
holders of additional securities. Zero coupon bonds and PIK bonds are
generally considered to be more interest-sensitive than income bearing bonds,
to be more speculative than interest-bearing bonds, and to have certain tax
consequences which could, under certain circumstances, be adverse to the Fund.
For example, with zero coupon bonds, the Fund accrues, and is required to
distribute to shareholders, income on such bonds. However, the Fund may not
receive the cash associated with this income until the bonds are sold or
mature. If the Fund did not have sufficient cash to make the required
distribution of accrued income, the Fund could be required to sell other
securities in its portfolio or to borrow to generate the cash required.

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<PAGE> 105

BORROWINGS
The Fund may borrow money as a temporary measure for extraordinary
purposes or to facilitate redemptions. The Fund will not borrow money in
excess of one-third of the value of its net assets. The Fund has no intention
of increasing its net income through borrowing. Any borrowing will be done
from a bank and, to the extent that such borrowing exceeds 5% of the value of
the Fund's net assets, asset coverage of at least 300% is required. In the
event that such asset coverage shall at any time fall below 300%, the Fund
shall, within three days thereafter (not including Sundays or holidays, or such
longer period as the Securities and Exchange Commission may prescribe by rules
and regulations), reduce the amount of its borrowings to such an extent that
the asset coverage of such borrowings shall be at least 300%. The Fund will
not pledge more than 10% of its net assets, or issue senior securities as
defined in the 1940 Act, except for notes to banks. Investment securities will
not be purchased while the Fund has an outstanding borrowing.

PORTFOLIO LOAN TRANSACTIONS
The Fund may loan up to 25% of its assets to qualified broker/dealers
or institutional investors.

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<PAGE> 106

If the Manager determines that a Rule 144A Security which was
previously determined to be liquid is no longer liquid and, as a result, the
Fund's holdings of illiquid securities exceed the Fund's 15% limit on
investments in such securities, the Manager will determine what action to take
to ensure that the Fund continues to adhere to such limitation.

REPURCHASE AGREEMENTS

In order to invest its short-term cash reserves or when in a temporary
defensive posture, the Fund may enter into repurchase agreements with banks or
broker/dealers deemed to be creditworthy by the Manager, under guidelines
approved by the Board of Directors. A repurchase agreement is a short-term
investment in which the purchaser (i.e. the Fund) acquires ownership of a debt
security and the seller agrees to repurchase the obligation at a future time
and set price, thereby determining the yield during the purchaser's holding
period. Generally, repurchase agreements are of short duration, often less
than one week but on occasion for longer periods. Not more than 15% of the
Fund's assets may be invested in repurchase agreements of over seven days'
maturity or other illiquid assets. Should an issuer of a repurchase agreement
fail to repurchase the underlying security, the loss to the Fund, if any, would
be the difference between the repurchase price and the market value of the
security. The Fund will limit its investments in repurchase agreements to
those which the Manager under guidelines of the Board of Directors determines
to present minimal credit risks and which are of high quality. In addition,
the Fund must have collateral of at least 100% of the repurchase price,
including the portion representing the Fund's yield under such agreements,
which is monitored on a daily basis.

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<PAGE> 107

expedite settlement of portfolio transactions and to minimize currency value
fluctuations. The Fund may conduct its foreign currency exchange transactions
on a spot (i.e., cash) basis at the spot rate prevailing in the foreign
currency exchange market or through entering into contracts to purchase or sell
foreign currencies at a future date (i.e., a "forward foreign currency"
contract or "forward" contract). A forward contract involves an obligation to
purchase or sell a specific currency at a future date, which may be any fixed
number of days from the date of the contract, agreed upon by the parties, at a
price set at the time of the contract. The Fund will convert currency on a
spot basis from time to time, and investors should be aware of the costs of
currency conversion.

The Fund may enter into forward contracts to "lock in" the price of a
security it has agreed to purchase or sell, in terms of U.S. dollars or other
currencies in which the transaction will be consummated. By entering into a
forward contract for the purchase or sale, for a fixed amount of U.S. dollars
or foreign currency, of the amount of foreign currency involved in the
underlying security transaction, the Fund will be able to protect itself
against a possible loss resulting from an adverse change in currency exchange
rates during the period between the date the security is purchased or sold and
the date on which payment is made or received.

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<PAGE> 108

A call option enables the purchaser, in return for the premium paid,
to purchase securities from the writer of the option at an agreed price up to
an agreed date. A covered call option obligates the writer, in return for the
premium received, to sell the securities subject to the option to the purchaser
of the option for an agreed upon price up to an agreed date. The advantage is
that the purchaser may hedge against an increase in the price of securities it
ultimately wishes to buy or take advantage of a rise in a particular index.
The Fund will only purchase call options to the extent that premiums paid on
all outstanding call options do not exceed 2% of its total assets. The Fund
may write covered call options in an amount not to exceed 10% of its total
assets.

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<PAGE> 109

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<PAGE> 110

APPENDIX A--RATINGS

General Rating Information

Excerpts from Fitch's description of its bond ratings: AAA--Bonds considered
to be investment grade and of the highest credit quality. The obligor has an
exceptionally strong ability to pay interest and repay principal, which is
unlikely to be affected by reasonably foreseeable events; AA--Bonds considered
to be investment grade and of very high credit quality. The obligor's ability
to pay interest and repay principal is very strong, although not quite as
strong as bonds rated AAA. Because bonds rated in the AAA and AA categories
are not significantly vulnerable to foreseeable future developments, short-term
debt of these issuers is generally rated F-1+; A--Bonds considered to be
investment grade and of high credit quality.

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<PAGE> 111

The obligor's ability to pay interest and repay principal is considered to be
strong, but may be more vulnerable to adverse changes in economic conditions
and circumstances than bonds with higher ratings; BBB--Bonds considered to be
investment grade and of satisfactory credit quality. The obligor's ability to
pay interest and repay principal is considered to be adequate. Adverse changes
in economic conditions and circumstances, however, are more likely to have
adverse impact on these bonds, and therefore impair timely payment. The
likelihood that the ratings of these bonds will fall below investment grade is
higher than for bonds with higher ratings; BB--Bonds are considered
speculative. The obligor's ability to pay interest and repay principal may be
affected over time by adverse economic changes. However, business and
financial alternatives can be identified which could assist the obligor in
satisfying its debt service requirements; B--Bonds are considered highly
speculative. While bonds in this class are currently meeting debt service
requirements, the probability of continued timely payment of principal and
interest reflects the obligor's limited margin of safety and the need for
reasonable business and economic activity throughout the life of the issue;
CCC--Bonds have certain identifiable characteristics which, if not remedied,
may lead to default. The ability to meet obligations requires an advantageous
business and economic environment; CC--Bonds are minimally protected. Default
in payment of interest and/or principal seems probable over time; C--Bonds are
in imminent default in payment of interest or principal; and DDD, DD AND
D--Bonds are in default on interest and/or principal payments. Such bonds are
extremely speculative and should be valued on the basis of their ultimate
recovery value in liquidation or reorganization of the obligor. "DDD"
represents the highest potential for recovery on these bonds, and "D"
represents the lowest potential for recovery.

Plus and minus signs are used with a rating symbol to indicate the
relative position of a credit within the rating category. Plus and minus
signs, however, are not used in the "AAA" category.

PREFERRED STOCK
The following are excerpts from S&P's description of its preferred
stock ratings:

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<PAGE> 112

The preferred stock ratings are based on the following considerations:

2. Nature of, and provisions of, the issue.

3. Relative position of the issue in the event of bankruptcy,
reorganization, or other arrangements affecting creditors'
rights.

AAA This is the highest rating that may be assigned by S&P to a preferred
stock issue and indicates an extremely strong capacity to pay the
preferred stock obligations.

AA A preferred stock issue rated "AA" also qualifies as a high-quality
fixed-income security. The capacity to pay preferred stock
obligations is very strong, although not as overwhelming as for issues
rated "AAA."

A An issue rated "A" is backed by a sound capacity to pay the preferred
stock obligations, although it is somewhat more susceptible to the
adverse effects of changes in circumstances and economic conditions.

BBB An issue rated "BBB" is regarded as backed by an adequate capacity to
pay the preferred stock obligations. Whereas it normally exhibits
adequate protection parameters, adverse economic conditions or
changing circumstances are more likely to lead to a weakened capacity
to make payments for a preferred stock in this category than for
issues in the "A" category.

BB, B, Preferred stocks rated "BB," "B" and "CCC" are regarded, on balance,
as
CCC predominantly speculative with respect to the issuer's capacity to pay
preferred stock obligations. "BB" indicates the lowest degree of
speculation and "CCC" the highest degree of speculation. While such
issues will likely have some quality and protective characteristics,
these are outweighed by large uncertainties or major risk exposures to
adverse conditions.

CC The rating "CC" is reserved for a preferred stock issue in arrears on
dividends or sinking fund payments but that is currently paying.

C A preferred stock rated "C" is a non-paying issue.

D A preferred stock rated "D" is a non-paying issue with the issuer in
default on debt instruments.

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<PAGE> 113

NR indicates that no rating has been requested, that there is
insufficient information on which to base a rating, or that S&P does not rate a
particular type of obligations as a matter of policy.

The following are excerpts from Moody's description of its preferred
stock ratings:

"caa" An issue which is rated "caa" is likely to be in arrears on
dividends payments. This rating designation does not purport
to indicate the future status of payments.

"ca" An issue which is rated "ca" is speculative in a high degree
and is likely to be in arrears on dividends with little
likelihood of eventual payments.

"c" This is the lowest rated class of preferred or preference
stock. Issues so rated can be regarded as having extremely
poor prospects of ever attaining any real investment standing.

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<PAGE> 114

The Delaware Group includes funds with a wide range of investment
objectives. Stock funds, income funds, tax-free funds, money market funds,
global and international funds and closed-end equity funds give investors the
ability to create a portfolio that fits their personal financial goals. For
more information, shareholders of the Fund Classes should contact their
financial adviser or call Delaware Group at 800- 523-4640 and shareholders of
the Institutional Class should contact Delaware Group at 800-828-5052.

INVESTMENT MANAGER
Delaware Management Company, Inc.
One Commerce Square
Philadelphia, PA 19103

NATIONAL DISTRIBUTOR
Delaware Distributors, L.P.
1818 Market Street
Philadelphia, PA 19103

SHAREHOLDER SERVICING,
DIVIDEND DISBURSING,
ACCOUNTING SERVICES
AND TRANSFER AGENT
Delaware Service Company, Inc.
1818 Market Street
Philadelphia, PA 19103

LEGAL COUNSEL
Stradley, Ronon, Stevens & Young, LLP
One Commerce Square
Philadelphia, PA 19103

INDEPENDENT AUDITORS
Ernst & Young LLP
Two Commerce Square
Philadelphia, PA 19103

CUSTODIAN

The Chase Manhattan Bank
4 Chase Metrotech Center
Brooklyn, NY 11245

________________________________________________________
DELAWARE GROUP EQUITY FUNDS V, INC.
(FORMERLY DELAWARE GROUP VALUE FUND, INC.)

________________________________________________________
VALUE FUND
________________________________________________________
RETIREMENT INCOME FUND
________________________________________________________

PART B

STATEMENT OF
ADDITIONAL INFORMATION

________________________________________________________

NOVEMBER 29, 1996

DELAWARE
GROUP

<PAGE> 115
________________________________________________________________________________
PART B--STATEMENT OF ADDITIONAL INFORMATION
NOVEMBER 29, 1996
________________________________________________________________________________

DELAWARE GROUP EQUITY FUNDS V, INC.

________________________________________________________________________________
1818 MARKET STREET
PHILADELPHIA, PA 19103
________________________________________________________________________________
FOR MORE INFORMATION ABOUT VALUE FUND INSTITUTIONAL CLASS AND
RETIREMENT INCOME FUND INSTITUTIONAL CLASS: 800-828-5052

FOR PROSPECTUS AND PERFORMANCE OF VALUE FUND A CLASS,
VALUE FUND B CLASS, VALUE FUND C CLASS,
RETIREMENT INCOME FUND A CLASS,
RETIREMENT INCOME FUND B CLASS AND
RETIREMENT INCOME FUND C CLASS: NATIONWIDE 800-523-4640

INFORMATION ON EXISTING ACCOUNTS OF VALUE FUND A CLASS,
VALUE FUND B CLASS, VALUE FUND C CLASS,
RETIREMENT INCOME FUND A CLASS,
RETIREMENT INCOME FUND B CLASS AND
RETIREMENT INCOME FUND C CLASS:
(SHAREHOLDERS ONLY) NATIONWIDE 800-523-1918

DEALER SERVICES: (BROKER/DEALERS ONLY) NATIONWIDE 800-362-7500
________________________________________________________________________________
TABLE OF CONTENTS
________________________________________________________________________________
COVER PAGE
________________________________________________________________________________
INVESTMENT POLICIES AND PORTFOLIO TECHNIQUES
________________________________________________________________________________
ACCOUNTING AND TAX ISSUES
________________________________________________________________________________
PERFORMANCE INFORMATION
________________________________________________________________________________
TRADING PRACTICES AND BROKERAGE
________________________________________________________________________________
PURCHASING SHARES
________________________________________________________________________________
INVESTMENT PLANS
________________________________________________________________________________
DETERMINING OFFERING PRICE AND
NET ASSET VALUE
________________________________________________________________________________
REDEMPTION AND REPURCHASE
________________________________________________________________________________
DISTRIBUTIONS AND TAXES
________________________________________________________________________________
INVESTMENT MANAGEMENT AGREEMENTS
________________________________________________________________________________
OFFICERS AND DIRECTORS
________________________________________________________________________________
EXCHANGE PRIVILEGE
________________________________________________________________________________
GENERAL INFORMATION
________________________________________________________________________________
APPENDIX A--IRA INFORMATION
________________________________________________________________________________
APPENDIX B
________________________________________________________________________________
FINANCIAL STATEMENTS
________________________________________________________________________________

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<PAGE> 116

Delaware Group Equity Funds V, Inc. ("Equity Funds V, Inc.") (formerly
Delaware Group Value Fund, Inc.) is a professionally-managed mutual fund of the
series type which currently offers two series: the Value Fund series ("Value
Fund") and the Retirement Income Fund series ("Retirement Income Fund")
(individually a "Fund" and collectively the "Funds").

Each Fund of Equity Funds V, Inc. offers three retail classes: the
Value Fund A Class and the Retirement Income Fund A Class (the "Class A
Shares"); the Value Fund B Class and the Retirement Income Fund B Class (the
"Class B Shares"); and the Value Fund C Class and the Retirement Income Fund C
Class (the "Class C Shares"). Class A Shares, Class B Shares and Class C
Shares are collectively referred to as the "Fund Classes." Each Fund also
offers an institutional class: the Value Fund Institutional Class and the
Retirement Income Fund Institutional Class (collectively, the "Institutional
Classes"). Each class is individually referred to as a "Class" and
collectively referred to as "Classes."

Class B Shares, Class C Shares and Institutional Class shares of each
Fund may be purchased at a price equal to the next determined net asset value
per share. Class A Shares may be purchased at the public offering price, which
is equal to the next determined net asset value per share, plus a front-end
sales charge. Class A Shares are subject to a maximum front-end sales charge
of 4.75% and, absent any applicable fee waiver, annual Rule 12b-1 Plan ("12b-1
Plan") expenses of up to 0.30%. Class B Shares are subject to a contingent
deferred sales charge ("CDSC") which may be imposed on redemptions made within
six years of purchase and, absent any applicable fee waiver, annual 12b-1 Plan
expenses of up to 1% which are assessed against Class B Shares for
approximately eight years after purchase. See Automatic Conversion of Class B
Shares under Classes of Shares in the Prospectuses for the Fund Classes. Class
C Shares are subject to a CDSC which may be imposed on redemptions made within
12 months of purchase and, absent any applicable fee waiver, annual 12b-1 Plan
expenses of up to 1%, which are assessed against the Class C Shares for the
life of the investment. The Retirement Income Fund will not pay a 12b-1 fee
with respect to any Class until May 31, 1997.

This Statement of Additional Information ("Part B" of the registration
statement) supplements the information contained in the current Prospectuses of
the Fund Classes for the Value Fund dated January 29, 1996 and the Retirement
Income Fund dated November 29, 1996, and the current Prospectuses of the
Institutional Classes for the Value Fund dated January 29, 1996 and the
Retirement Income Fund dated November 29, 1996, as they may be amended from
time to time. Part B should be read in conjunction with the respective Class'
Prospectus. Part B is not itself a prospectus but is, in its entirety,
incorporated by reference into each Class' Prospectus. A Prospectus for each
Class may be obtained by writing or calling your investment dealer or by
contacting Equity Funds V, Inc.'s national distributor, Delaware Distributors,
L.P. (the "Distributor"), 1818 Market Street, Philadelphia, PA 19103.

All references to "shares" in this Part B refer to all Classes of
shares of Equity Funds V, Inc., except where noted.

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<PAGE> 117
INVESTMENT POLICIES AND PORTFOLIO TECHNIQUES

INVESTMENT RESTRICTIONS--Value Fund has adopted the following
restrictions which, along with its investment objective, cannot be changed
without approval by the holders of a "majority" of the Fund's outstanding
shares, which is a vote by the holders of the lesser of a) 67% or more of the
voting securities of the Fund present in person or by proxy at a meeting, if
the holders of more than 50% of the outstanding voting securities are present
or represented by proxy or b) more than 50% of the outstanding voting
securities of the Fund. The percentage limitations contained in the
restrictions and policies set forth herein apply at the time of purchase of
securities.

The Value Fund shall not:

1. Invest more than 5% of the market or other fair value of its
assets in the securities of any one issuer (other than obligations of, or
guaranteed by, the U.S. government, its agencies or instrumentalities).

2. Invest in securities of other investment companies except as
part of a merger, consolidation or other acquisition.

3. Make loans, except to the extent that purchases of debt
obligations (including repurchase agreements), in accordance with the Fund's
investment objective and policies, are considered loans and except that the
Fund may loan up to 25% of its assets to qualified broker/dealers or
institutional investors for their use relating to short sales or other security
transactions.

4. Purchase or sell real estate but this shall not prevent the
Fund from investing in securities secured by real estate or interests therein.

5. Purchase more than 10% of the outstanding voting and nonvoting
securities of any issuer, or invest in companies for the purpose of exercising
control or management.

6. Engage in the underwriting of securities of other issuers,
except that in connection with the disposition of a security, the Fund may be
deemed to be an "underwriter" as that term is defined in the Securities Act of
1933.

7. Make any investment which would cause more than 25% of the
market or other fair value of its total assets to be invested in the securities
of issuers all of which conduct their principal business activities in the same
industry. This restriction does not apply to obligations issued or guaranteed
by the U.S. government, its agencies or instrumentalities.

8. Write or purchase puts, calls or combinations thereof, except
that the Fund may write covered call options with respect to any or all parts
of its portfolio securities and purchase put options if the Fund owns the
security covered by the put option at the time of purchase, and that premiums
paid on all put options outstanding do not exceed 2% of its total assets. The
Fund may sell put options previously purchased and enter into closing
transactions with respect to covered call and put options. In addition, the
Fund may write call options and purchase put options on stock indices and enter
into closing transactions with respect to such options.

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<PAGE> 118
9. Purchase securities on margin, make short sales of securities
or maintain a net short position.

10. Invest more than 5% of the value of its total assets in
securities of companies less than three years old. Such three-year period
shall include the operation of any predecessor company or companies.

11. Invest in warrants valued at lower of cost or market exceeding
5% of the Fund's net assets. Included in that amount, but not to exceed 2% of
the Fund's net assets, may be warrants not listed on the New York Stock
Exchange or American Stock Exchange.

12. Purchase or retain the securities of any issuer which has an
officer, director or security holder who is a director or officer of the Fund
or of its investment manager if or so long as the directors and officers of the
Fund and of its investment manager together own beneficially more than 5% of
any class of securities of such issuer.

13. Invest in interests in oil, gas or other mineral exploration
or development programs.

14. Invest more than 10% of the Fund's net assets in repurchase
agreements maturing in more than seven days and other illiquid assets.

15. Borrow money in excess of one-third of the value of its net
assets and then only as a temporary measure for extraordinary purposes or to
facilitate redemptions. The Fund has no intention of increasing its net income
through borrowing. Any borrowing will be done from a bank and to the extent
that such borrowing exceeds 5% of the value of the Fund's net assets, asset
coverage of at least 300% is required. In the event that such asset coverage
shall at any time fall below 300%, the Fund shall, within three days thereafter
(not including Sunday or holidays) or such longer period as the Securities and
Exchange Commission may prescribe by rules and regulations, reduce the amount
of its borrowings to such an extent that the asset coverage of such borrowings
shall be at least 300%. The Fund will not pledge more than 10% of its net
assets. The Fund will not issue senior securities as defined in the Investment
Company Act of 1940 (the "1940 Act"), except for notes to banks. Investment
securities will not normally be purchased while the Fund has an outstanding
borrowing.

The Value Fund has a policy, which may not be changed without
shareholder approval, that it will not invest in commodities; however, the Fund
reserves the right to invest in financial futures and options thereon,
including stock index futures, to the extent these instruments are considered
commodities.

In addition, although not a fundamental investment restriction, the
Value Fund currently does not invest its assets in real estate limited
partnerships.

Retirement Income Fund has adopted the following restrictions which
cannot be changed without approval by the holders of a "majority" of the Fund's
outstanding shares, which is a vote by the holders of the lesser of a) 67% or
more of the voting securities of the Fund present in person or by proxy at a
meeting, if the holders of more than 50% of the outstanding voting securities
are present or represented by proxy or b) more than 50% of the outstanding
voting securities of the Fund. The percentage limitations contained in the
restrictions and policies set forth herein apply at the time of purchase of
securities.

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The Retirement Income Fund shall not:

1. With respect to 75% of its total assets, invest more than 5%
of the value of its assets in securities of any one issuer (except obligations
issued, or guaranteed by, the U.S. government, its agencies or
instrumentalities or certificates of deposit for any such securities, and cash
and cash items) or purchase more than 10% of the outstanding voting securities
of any one company.

2. Invest in securities of other investment companies, except
that the Fund may invest in securities of open-end, closed-end and unregistered
investment companies, in accordance with the limitations contained in the 1940
Act.

3. Make loans, except to the extent that purchases of debt
obligations (including repurchase agreements), in accordance with the Fund's
investment objectives and policies, are considered loans and except that the
Fund may loan up to 25% of its assets to qualified broker/dealers or
institutional investors for their use relating to short sales or other security
transactions.

4. Purchase or sell real estate. This restriction shall not
preclude the Fund's purchase of securities issued by real estate investment
trusts, the purchase of securities issued by companies that deal in real
estate, or the investment in securities secured by real estate or interests
therein.

5. Invest in companies for the purpose of exercising control or
management.

6. Engage in the underwriting of securities of other issuers,
except that the Fund may acquire restricted or not readily marketable
securities under circumstances where, if such securities are sold, the Fund
might be deemed to be an underwriter for purposes of the Securities Act of
1933.

7. Make any investment which would cause more than 25% of the
market or other fair value of its total assets to be invested in securities of
issuers all of which conduct their principal business activities in the same
industry. This restriction does not apply to obligations issued or guaranteed
by the U.S. government, its agencies or instrumentalities.

8. Buy or sell commodities or commodity contracts, except that
the Fund may invest in financial futures and options thereon, including stock
index futures, to the extent these instruments are considered commodities.

9. Invest in interests in oil, gas or other mineral exploration
or development programs.

10. Purchase securities on margin, except that the Fund may
satisfy margin requirements with respect to futures
transactions.

11. Borrow money in excess of one-third of the value of its net
assets and then only as a temporary measure for extraordinary purposes or to
facilitate redemptions. The Fund has no intention of increasing its net income
through borrowing. Any borrowing will be done from a bank and to the extent
that such borrowing exceeds 5% of the value of the Fund's net assets, asset
coverage of at least 300% is required. In the event that such asset coverage
shall at any time fall below 300%, the Fund shall, within three days thereafter
(not including Sunday or holidays) or such longer period as the Securities and
Exchange Commission may prescribe

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by rules and regulations, reduce the amount of its borrowings to such an extent
that the asset coverage of such borrowings shall be at least 300%. The Fund
shall not issue senior securities as defined by the 1940 Act, except for notes
to banks. Investment securities will not normally be purchased while the Fund
has an outstanding borrowing.

In addition to the above fundamental investment restrictions, the
Retirement Income Fund has the following investment restrictions which may be
amended or changed without approval of shareholders.

1. The Retirement Income Fund will not purchase or retain
securities of a company which has an officer or director who is an officer or
director of Equity Funds V, Inc., or an officer, director or partner of
Delaware Management Company, Inc. (the "Manager") if, to the knowledge of the
Fund, one or more of such persons beneficially owns more than 1/2 of 1% of the
shares of the company, and in the aggregate more than 5% thereof.

2. Other than securities of real estate investment trusts, the
Retirement Income Fund will not invest in the securities of companies which
have a record of less than three years' continuous operation, including any
predecessor company or companies, if such investment at the time of purchase
would cause more than 5% of the Fund's total assets to be invested in the
securities of such company or companies.

INVESTMENT POLICIES--The application of each Fund's investment policy
will be dependent upon the judgment of the Manager. In accordance with the
judgment of the Manager, the proportions of a Fund's assets invested in
particular industries will vary from time to time. The securities in which
each Fund invests may or may not be listed on a national stock exchange, but if
they are not so listed, they will generally have an established
over-the-counter market.

In addition, from time to time, the Funds may also engage in the
following investment techniques:

REPURCHASE AGREEMENTS

A repurchase agreement is a short-term investment by which the
purchaser acquires ownership of a debt security and the seller agrees to
repurchase the obligation at a future time and set price, thereby determining
the yield during the purchaser's holding period. Should an issuer of a
repurchase agreement fail to repurchase the underlying security, the loss to
the Funds, if any, would be the difference between the repurchase price and the
market value of the security. Each Fund will limit its investments in
repurchase agreements to those which the Manager, under the guidelines of the
Board of Directors, determines to present minimal credit risks and which are of
high quality. In addition, each Fund must have collateral of at least 100% of
the repurchase price, including the portion representing such Fund's yield
under such agreements which is monitored on a daily basis. While the Funds are
permitted to do so, they normally do not invest in repurchase agreements,
except to invest cash balances.

The funds in the Delaware Group have obtained an exemption from the
joint-transaction prohibitions of Section 17(d) of the 1940 Act to allow the
Delaware Group funds jointly to invest cash balances. The Funds may invest
cash balances in a joint repurchase agreement in accordance with the terms of
the Order and subject generally to the conditions described below.

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PORTFOLIO LOAN TRANSACTIONS
Each Fund may loan up to 25% of its assets to qualified broker/dealers
or institutional investors for their use relating to short sales or other
security transactions.

It is the understanding of the Manager that the staff of the
Securities and Exchange Commission permits portfolio lending by registered
investment companies if certain conditions are met. These conditions are as
follows: 1) each transaction must have 100% collateral in the form of cash,
short-term U.S. government securities, or irrevocable letters of credit payable
by banks acceptable to the Fund from the borrower; 2) this collateral must be
valued daily and should the market value of the loaned securities increase, the
borrower must furnish additional collateral to the Fund; 3) the Fund must be
able to terminate the loan after notice, at any time; 4) the Fund must receive
reasonable interest on any loan, and any dividends, interest or other
distributions on the lent securities, and any increase in the market value of
such securities; 5) the Fund may pay reasonable custodian fees in connection
with the loan; and 6) the voting rights on the lent securities may pass to the
borrower; however, if the directors of the Fund know that a material event will
occur affecting a loan, they must either terminate the loan in order to vote
the proxy or enter into an alternative arrangement with the borrower to enable
the directors to vote the proxy.

The major risk to which the Funds would be exposed on a loan
transaction is the risk that a borrower would go bankrupt at a time when the
value of the security goes up. Therefore, the Funds will only enter into loan
arrangements after a review of all pertinent facts by the Manager, under the
supervision of the Board of Directors, including the creditworthiness of the
borrowing broker, dealer or institution and then only if the consideration to
be received from such loans would justify the risk. Creditworthiness will be
monitored on an ongoing basis by the Manager.

NON-TRADITIONAL EQUITY SECURITIES
The Retirement Income Fund may invest in convertible preferred stocks
that offer enhanced yield features, such as Preferred Equity Redemption
Cumulative Stock ("PERCS"), which provide an investor, such as the Fund, with
the opportunity to earn higher dividend income than is available on a company's
common stock. A PERCS is a preferred stock which generally features a
mandatory conversion date, as well as a capital appreciation limit which is
usually expressed in terms of a stated price. Upon the conversion date, most
PERCS convert into common stock of the issuer (PERCS are generally not
convertible into cash at maturity). Under a typical arrangement, if after a
predetermined number of years the issuer's common stock is trading at a price
below that set by the capital appreciation limit, each PERCS would convert to
one share of common stock. If, however, the issuer's common stock is trading
at a price above that set by the capital appreciation limit, the holder of the
PERCS would receive less than one full share of common stock. The amount of
that fractional share of common stock received by the PERCS holder is
determined by dividing the price set by the capital appreciation limit of the
PERCS by the market price of the issuer's common stock. PERCS can be called at
any time prior to maturity, and hence do not provide call protection. However,
if called early, the issuer may pay a call premium over the market price to the
investor. This call premium declines at a preset rate daily, up to the
maturity date of the PERCS.

The Retirement Income Fund may also invest in other enhanced
convertible securities. These include but are not limited to ACES
(Automatically Convertible Equity Securities), PEPS (Participating Equity
Preferred Stock), PRIDES (Preferred Redeemable Increased Dividend Equity
Securities), SAILS (Stock Appreciation Income Linked Securities), TECONS (Term
Convertible Notes), QICS (Quarterly Income

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Cumulative Securities) and DECS (Dividend Enhanced Convertible Securities).
ACES, PEPS, PRIDES, SAILS, TECONS, QICS, and DECS all have the following
features: they are company-issued convertible preferred stock; unlike PERCS,
they do not have capital appreciation limits; they seek to provide the investor
with high current income, with some prospect of future capital appreciation;
they are typically issued with three to four-year maturities; they typically
have some built-in call protection for the first two to three years; investors
have the right to convert them into shares of common stock at a preset
conversion ratio or hold them until maturity; and upon maturity, they will
automatically convert to either cash or a specified number of shares of common
stock.

* * *

RESTRICTED SECURITIES

Each Fund may invest in restricted securities, including unregistered
securities eligible for resale without registration pursuant to Rule 144A
("Rule 144A Securities") under the Securities Act of 1933 ("1933 Act"). Rule
144A Securities may be freely traded among qualified institutional investors
without registration under the 1933 Act. All of the Funds' option activities
will be engaged in a manner that is consistent with the Securities and Exchange
Commission's position concerning segregation of assets with a Fund's custodian
bank.

Investing in Rule 144A Securities could have the effect of increasing
the level of the Fund's illiquidity to the extent that qualified institutional
buyers become, for a time, uninterested in purchasing these securities. After
the purchase of a Rule 144A Security, however, the Board of Directors and the
Manager will continue to monitor the liquidity of that security to ensure that
Value Fund has no more than 10% and Retirement Income Fund has no more than 15%
of their respective net assets invested in illiquid securities.

OPTIONS
The Value Fund may write call options and purchase put options on a
covered basis only, and will not engage in option writing strategies for
speculative purposes. The Retirement Income Fund may purchase call and put
options and write call options on a covered basis only. The Funds will not
engage in option strategies for speculative purposes.

A. COVERED CALL WRITING--The Value Fund may write covered call
options, from time to time, on such portion of its portfolio, without limit, as
the Manager determines is appropriate in seeking to obtain that Fund's
investment objective. The Retirement Income Fund may write covered call
options in an amount not to exceed 10% of its total assets. A call option
gives the purchaser of such option the right to buy, and the writer, in this
case a Fund, has the obligation to sell the underlying security at the exercise
price during the option period. The advantage to a Fund of writing covered
calls is that the Fund receives additional income, in the form of a premium,
which may offset any capital loss or decline in market value of the security.
However, if the security rises in value, the Fund may not fully participate in
the market appreciation.

During the option period, a covered call option writer may be assigned
an exercise notice by the broker/dealer through whom such call option was sold
requiring the writer to deliver the underlying security against payment of the
exercise price. This obligation is terminated upon the expiration of the
option period or at such earlier time in which the writer effects a closing
purchase transaction. A closing purchase transaction cannot be effected with
respect to an option once the option writer has received an exercise notice for
such option.

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With respect to both options on actual portfolio securities owned by
the Funds and options on stock indices, the Funds may enter into closing
purchase transactions. A closing purchase transaction is one in which a Fund,
when obligated as a writer of an option, terminates its obligation by
purchasing an option of the same series as the option previously written.

Closing purchase transactions will ordinarily be effected to realize a
profit on an outstanding call option, to prevent an underlying security from
being called, to permit the sale of the underlying security or to enable a Fund
to write another call option on the underlying security with either a different
exercise price or expiration date or both. A Fund may realize a net gain or
loss from a closing purchase transaction depending upon whether the net amount
of the original premium received on the call option is more or less than the
cost of effecting the closing purchase transaction. Any loss incurred in a
closing purchase transaction may be partially or entirely offset by the premium
received from a sale of a different call option on the same underlying
security. Such a loss may also be wholly or partially offset by unrealized
appreciation in the market value of the underlying security. Conversely, a
gain resulting from a closing purchase transaction could be offset in whole or
in part by a decline in the market value of the underlying security.

If a call option expires unexercised, the Fund will realize a
short-term capital gain in the amount of the premium on the option, less the
commission paid. Such a gain, however, may be offset by depreciation in the
market value of the underlying security during the option period. If a call
option is exercised, the Fund will realize a gain or loss from the sale of the
underlying security equal to the difference between the cost of the underlying
security, and the proceeds of the sale of the security plus the amount of the
premium on the option, less the commission paid.

The market value of a call option generally reflects the market price
of an underlying security. Other principal factors affecting market value
include supply and demand, interest rates, the price volatility of the
underlying security and the time remaining until the expiration date.

The Funds will write call options only on a covered basis, which means
that a Fund will own the underlying security subject to a call option at all
times during the option period or securities convertible or exchangeable into
the securities subject to the call option at no additional consideration or a
Fund owns a call option on the relevant securities with an exercise price no
higher than the exercise price on the call option written or subject to any
regulatory restrictions, an amount of cash or liquid high grade debt
obligations at least equal to the current underlying securities. Unless a
closing purchase transaction is effected, a Fund would be required to continue
to hold a security which it might otherwise wish to sell, or deliver a security
it would want to hold. Options written by the Funds will normally have
expiration dates between one and nine months from the date written. The
exercise price of a call option may be below, equal to or above the current
market value of the underlying security at the time the option is written.

B. PURCHASING CALL OPTIONS--The Retirement Income Fund may
purchase call options in an amount not to exceed 2% of its total assets. When
the Retirement Income Fund purchases a call option, in return for a premium
paid by the Fund to the writer of the option, the Fund obtains the right to buy
the security underlying the option at a specified exercise price at any time
during the term of the option. The advantage of purchasing call options is
that the Fund may alter its portfolio's characteristics and modify portfolio
maturities without incurring the cost associated with portfolio transactions.

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<PAGE> 124
The Retirement Income Fund may, following the purchase of a call
option, liquidate its position by effecting a closing sale transaction. This
is accomplished by selling an option of the same series as the option
previously purchased. The Fund will realize a profit from a closing sale
transaction if the price received on the transaction is more than the premium
paid to purchase the original call option; the Fund will realize a loss from a
closing sale transaction if the price received on the transaction is less than
the premium paid to purchase the original call option. There is no assurance,
however, that a liquid secondary market on an exchange will exist for any
particular option, or at any particular time, and for some options no secondary
market on an exchange may exist. In such event, it may not be possible to
effect closing transactions in particular options, with the result that the
Fund would have to exercise its options in order to realize any profit and
would incur brokerage commissions upon the exercise of such options and upon
the subsequent disposition of the underlying securities acquired through the
exercise of such options. Further, unless the price of the underlying security
changes sufficiently, a call option purchased by the Fund may expire without
any value to the Fund.

C. PURCHASING PUT OPTIONS--Each Fund may invest up to 2% of its
total assets in the purchase of put options. The Funds will, at all times
during which they hold a put option, own the security covered by such option.

The Funds intend to purchase put options in order to protect against a
decline in the market value of the underlying security below the exercise price
less the premium paid for the option ("protective puts"). The ability to
purchase put options will allow the Funds to protect an unrealized gain in an
appreciated security in their portfolios without actually selling the security.
If the security does not drop in value, the Funds will lose the value of the
premium paid. Each Fund may sell a put option which it has previously
purchased prior to the sale of the securities underlying such option. Such
sales will result in a net gain or loss depending on whether the amount
received on the sale is more or less than the premium and other transaction
costs paid on the put option which is sold.

The Funds may enter into closing sale transactions. A closing sale
transaction is one in which a Fund, when it is the holder of an outstanding
option, liquidates its position by selling an option of the same series as the
option previously purchased.

OPTIONS ON STOCK INDICES
A stock index assigns relative values to the common stocks included in
the index with the index fluctuating with changes in the market values of the
underlying common stock.

Options on stock indices are similar to options on stocks but have
different delivery requirements. Stock options provide the right to take or
make delivery of the underlying stock at a specified price. A stock index
option gives the holder the right to receive a cash "exercise settlement
amount" equal to (i) the amount by which the fixed exercise price of the option
exceeds (in the case of a put) or is less than (in the case of a call) the
closing value of the underlying index on the date of exercise, multiplied by
(ii) a fixed "index multiplier." Receipt of this cash amount will depend upon
the closing level of the stock index upon which the option is based being
greater than (in the case of a call) or less than (in the case of a put) the
exercise price of the option. The amount of cash received will be equal to
such difference between the closing price of the index and exercise price of
the option expressed in dollars times a specified multiple. The writer of the
option is obligated, in return for the premium received, to make delivery of
this amount. Gain or loss to the Fund on

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<PAGE> 125
transactions in stock index options will depend on price movements in the stock
market generally (or in a particular industry or segment of the market) rather
than price movements of individual securities.

As with stock options, the Funds may offset their positions in stock
index options prior to expiration by entering into closing transactions, on an
Exchange or they may let the options expire unexercised.

A stock index fluctuates with changes in the market values of the
stock so included. Some stock index options are based on a broad market index
such as the Standard & Poor's 500 or the New York Stock Exchange Composite
Index, or a narrower market index such as the Standard & Poor's 100. Indices
are also based on an industry or market segment such as the AMEX Oil and Gas
Index or the Computer and Business Equipment Index. Options on stock indices
are currently traded on the following Exchanges among others: The Chicago
Board Options Exchange, New York Stock Exchange and American Stock Exchange.

The effectiveness of purchasing or writing stock index options as a
hedging technique will depend upon the extent to which price movements in a
Fund's portfolio correlate with price movements of the stock index selected.
Because the value of an index option depends upon movements in the level of the
index rather than the price of a particular stock, whether a Fund will realize
a gain or loss from the purchase or writing of options on an index depends upon
movements in the level of stock prices in the stock market generally or, in the
case of certain indices, in an industry or market segment, rather than
movements in the price of a particular stock. Since each Fund's portfolio will
not duplicate the components of an index, the correlation will not be exact.
Consequently, a Fund bears the risk that the prices of the securities being
hedged will not move in the same amount as the hedging instrument.

It is also possible that there may be a negative correlation between
the index or other securities underlying the hedging instrument and the hedged
securities which would result in a loss on both such securities and the hedging
instrument. Accordingly, successful use by the Funds of options on stock
indices will be subject to the Manager's ability to predict correctly movements
in the direction of the stock market generally or of a particular industry.
This requires different skills and techniques than predicting changes in the
price of individual stocks.

Positions in stock index options may be closed out only on an Exchange
which provides a secondary market. There can be no assurance that a liquid
secondary market will exist for any particular stock index option. Thus, it
may not be possible to close such an option. The inability to close options
positions could have an adverse impact on a Fund's ability to effectively hedge
its securities. Each Fund will enter into an option position only if there
appears to be a liquid secondary market for such options.

The Funds will not engage in transactions in options on stock indices
for speculative purposes but only to protect appreciation attained, to offset
capital losses and to take advantage of the liquidity available in the option
markets.

FOREIGN SECURITIES
Each of the Funds may invest in securities of foreign companies.
However, the Value Fund will not invest more than 25% of the value of its total
assets, at the time of purchase, in foreign securities (other than securities
of Canadian issuers registered under the Securities Exchange Act of 1934 or
American Depository Receipts, on which there are no such limits). The
Retirement Income Fund may, in addition to investing in

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<PAGE> 126
securities of foreign companies, invest in foreign government securities. No
more than 20% of the value of the Retirement Income Fund's total assets, at the
time of purchase, will be invested in foreign securities (other than securities
of Canadian issuers registered under the Securities Exchange Act of 1934 or
American Depository Receipts, on which there are no such limits).

There has been in the past, and there may be again in the future, an
interest equalization tax levied by the United States in connection with the
purchase of foreign securities such as those purchased by the Funds. Payment
of such interest equalization tax, if imposed, would reduce a Fund's rate of
return on its investment. Dividends paid by foreign issuers may be subject to
withholding and other foreign taxes which may decrease the net return on such
investments as compared to dividends paid to the Funds by United States
corporations.

Investors should recognize that investing in foreign corporations
involves certain considerations, including those set forth below, which are not
typically associated with investing in United States corporations. Foreign
corporations are not generally subject to uniform accounting, auditing and
financial standards and requirements comparable to those applicable to United
States corporations. There may also be less supervision and regulation of
foreign stock exchanges, brokers and listed corporations than exist in the
United States. The Funds may be affected either unfavorably or favorably by
fluctuations in the relative rates of exchange as between the currencies of
different nations and control regulations. Furthermore, there may be the
possibility of expropriation or confiscatory taxation, political, economic or
social instability or diplomatic developments which could affect assets of the
Funds held in foreign countries.

The Funds will, from time to time, conduct foreign currency exchange
transactions on a spot (i.e., cash) basis at the spot rate prevailing in the
foreign currency exchange market or through entering into contracts to purchase
or sell foreign currencies at a future date (i.e., a "forward foreign currency"
contract or "forward" contract). Investors should be aware that there are
costs and risks associated with such currency transactions. The Funds may
enter into forward contracts to "lock in" the price of a security it has agreed
to purchase or sell, in terms of U.S. dollars or other currencies in which the
transaction will be consummated. When the Manager believes that the currency
of a particular foreign country may suffer a decline against the U.S. dollar or
against another currency, a Fund may enter into a forward contract to sell, for
a fixed amount of U.S. dollars or other appropriate currency, the amount of
foreign currency approximating the value of some or all of that Fund's
securities denominated in such foreign currency. It is impossible to predict
precisely the market value of portfolio securities at the expiration of the
forward contract. Accordingly, it may be necessary for a Fund to purchase or
sell additional foreign currency on the spot market (and bear the expense of
such purchase or sale) if the market value of the security is less than or
greater than the amount of foreign currency the Fund is obligated to deliver.

The Funds may incur gains or losses from currency transactions. No
type of foreign currency transaction will eliminate fluctuations in the prices
of the Funds' foreign securities or will prevent loss if the prices of such
securities should decline.

Each Fund's Custodian for its foreign securities is The Chase
Manhattan Bank, 4 Chase Metrotech Center, Brooklyn, NY 11245.

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FUTURES AND OPTIONS ON FUTURES
The Retirement Income Fund may enter into contracts for the purchase
or sale for future delivery of securities. While futures contracts provide for
the delivery of securities, deliveries usually do not occur. Contracts are
generally terminated by entering into an offsetting transaction. When the
Retirement Income Fund enters into a futures transaction, it must deliver to
the futures commission merchant selected by the Fund an amount referred to as
"initial margin." This amount is maintained by the futures commission merchant
in an account at the Fund's Custodian Bank. Thereafter, a "variation margin"
may be paid by the Fund to, or drawn by the Fund from, such account in
accordance with controls set for such account, depending upon changes in the
price of the underlying securities subject to the futures contract.

The Retirement Income Fund may enter into such futures contracts to
protect against the adverse effects of fluctuations in interest rates without
actually buying or selling securities. For example, if interest rates are
expected to increase, the Fund might enter into futures contracts for the sale
of debt securities. Such a sale would have much the same effect as selling an
equivalent value of the debt securities owned by the Fund. If interest rates
did increase, the value of the debt securities in the portfolio would decline,
but the value of the futures contracts to the Fund would increase at
approximately the same rate, thereby keeping the net asset value of the Fund
from declining as much as it otherwise would have. Similarly, when it is
expected that interest rates may decline, futures contracts may be purchased to
hedge in anticipation of subsequent purchases of securities at higher prices.
Because the fluctuations in the value of futures contracts should be similar to
those of debt securities, the Fund could take advantage of the anticipated rise
in value of debt securities without actually buying them until the market had
stabilized. At that time, the futures contracts could be liquidated and the
Fund could then buy debt securities on the cash market.

With respect to options on futures contracts, when the Fund is not
fully invested, it may purchase a call option on a futures contract to hedge
against a market advance due to declining interest rates. The purchase of a
call option on a futures contract is similar in some respects to the purchase
of a call option on an individual security. Depending on the pricing of the
option compared to either the price of the futures contract upon which it is
based, or the price of the underlying debt securities, it may or may not be
less risky than ownership of the futures contract or underlying debt
securities.

The writing of a call option on a futures contract constitutes a
partial hedge against the declining price of the security which is deliverable
upon exercise of the futures contract. If the futures price at the expiration
of the option is below the exercise price, the Fund will retain the full amount
of the option premium which provides a partial hedge against any decline that
may have occurred in the Fund's holdings. The writing of a put option on a
futures contract constitutes a partial hedge against the increasing price of
the security which is deliverable upon exercise of the futures contract. If
the futures price at the expiration of the option is higher than the exercise
price, the Fund will retain the full amount of option premium which provides a
partial hedge against any increase in the price of securities which the Fund
intends to purchase.

If a put or call option that the Fund has written is exercised, the
Fund will incur a loss which will be reduced by the amount of the premium it
receives. Depending on the degree of correlation between changes in the value
of its portfolio securities and changes in the value of its futures positions,
the Fund's losses from existing options on futures may, to some extent, be
reduced or increased by changes in the value of portfolio securities. The
purchase of a put option on a futures contract is similar in some respects to
the purchase of

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protective puts on portfolio securities. For example, the Fund will purchase a
put option on a futures contract to hedge the Fund's securities against the
risk of rising interest rates.

To the extent that interest rates move in an unexpected direction, the
Fund may not achieve the anticipated benefits of futures contracts or options
on futures contracts or may realize a loss. For example, if the Fund is hedged
against the possibility of an increase in interest rates which would adversely
affect the price of securities held in its portfolio and interest rates
decrease instead, the Fund will lose part or all of the benefit of the
increased value of its securities which it has because it will have offsetting
losses in its futures position. In addition, in such situations, if the Fund
had insufficient cash, it may be required to sell securities from its portfolio
to meet daily variation margin requirements. Such sales of securities may, but
will not necessarily, be at increased prices which reflect the rising market.
The Funds may be required to sell securities at a time when it may be
disadvantageous to do so.

Further, with respect to options on futures contracts, the Fund may
seek to close out an option position by writing or buying an offsetting
position covering the same securities or contracts and have the same exercise
price and expiration date. The ability to establish and close out positions on
options will be subject to the maintenance of a liquid secondary market, which
cannot be assured.

HIGH-YIELD, HIGH RISK SECURITIES
Investing in so-called "high-yield" or "high risk" securities entails
certain risks, including the risk of loss of principal, which may be greater
than the risks involved in investment grade securities, and which should be
considered by investors contemplating an investment in the Funds. Such
securities are sometimes issued by companies whose earnings at the time of
issuance are less than the projected debt service on the high-yield securities.
The risks include the following:

A. YOUTH AND VOLATILITY OF THE HIGH-YIELD MARKET--Although the
market for high-yield securities has been in existence for many years,
including periods of economic downturns, the high-yield market grew rapidly
during the long economic expansion which took place in the United States during
the 1980s. During that economic expansion, the use of high-yield debt
securities to fund highly leveraged corporate acquisitions and restructurings
increased dramatically. As a result, the high-yield market grew substantially
during that economic expansion. Although experts disagree on the impact
recessionary periods have had and will have on the high-yield market, some
analysts believe a protracted economic downturn would severely disrupt the
market for high-yield securities, would adversely affect the value of
outstanding bonds and would adversely affect the ability of high-yield issuers
to repay principal and interest. Those analysts cite volatility experienced in
the high-yield market in the past as evidence for their position. It is likely
that protracted periods of economic uncertainty would result in increased
volatility in the market prices of high-yield securities, an increase in the
number of high-yield bond defaults and corresponding volatility in a Fund's net
asset value.

The Value Fund will not ordinarily purchase securities rated below B
by Moody's and S&P. However, it may do so if the Manager believes that capital
appreciation is likely. The Value Fund will not invest more than 25% of its
assets in such securities. While the Retirement Income Fund will not invest
more than 45% of its assets in high-yield, high risk debt securities, it has
the authority to invest up to all of its net assets in lower rated securities,
which would include income generating equity securities such as convertible
securities and preferred stocks.

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<PAGE> 129
B. LIQUIDITY AND VALUATION--The secondary market for high-yield
securities is currently dominated by institutional investors, including mutual
funds and certain financial institutions. There is generally no established
retail secondary market for high-yield securities. As a result, the secondary
market for high-yield securities is more limited and less liquid than other
secondary securities markets. The high-yield secondary market is particularly
susceptible to liquidity problems when the institutions which dominate it
temporarily cease buying such securities for regulatory, financial or other
reasons, such as the savings and loan crisis. A less liquid secondary market
may have an adverse effect on a Fund's ability to dispose of particular issues,
when necessary, to meet a Fund's liquidity needs or in response to a specific
economic event, such as the deterioration in the creditworthiness of the
issuer. In addition, a less liquid secondary market makes it more difficult
for a Fund to obtain precise valuations of the high-yield securities in its
portfolio. During periods involving such liquidity problems, judgment plays a
greater role in valuing high-yield securities than is normally the case. The
secondary market for high- yield securities is also generally considered to be
more likely to be disrupted by adverse publicity and investor perceptions than
the more established secondary securities markets. Privately placed high-yield
securities are particularly susceptible to the liquidity and valuation risks
outlined above.

C. LEGISLATIVE AND REGULATORY ACTION AND PROPOSALS--There are a
variety of legislative actions which have been taken or which are considered
from time to time by the United States Congress which could adversely affect
the market for high-yield bonds. For example, Congressional legislation
limited the deductibility of interest paid on certain high-yield bonds used to
finance corporate acquisitions. Also, Congressional legislation has, with some
exceptions, generally prohibited federally-insured savings and loan
institutions from investing in high-yield securities. Regulatory actions have
also affected the high-yield market. For example, many insurance companies
have restricted or eliminated their purchases of high-yield bonds as a result
of, among other factors, actions taken by the National Association of Insurance
Commissioners. If similar legislative and regulatory actions are taken in the
future, they could result in further tightening of the secondary market for
high-yield issues, could reduce the number of new high-yield securities being
issued.

SHORT SALES

The Retirement Income Fund may make short sales in an attempt to
protect against market declines. Typically, short sales are transactions in
which the Fund sells a security it does not own in anticipation of a decline in
the market value of that security. At the time a short sale is effected, the
Fund incurs an obligation to replace the security borrowed at whatever its
price may be at the time the Fund purchases it for delivery to the lender. The
price at such time may be more or less than the price at which the security was
sold by the Fund. When a short sale transaction is closed out by delivery of
the security, any gain or loss on the transaction is taxable as short-term
capital gain or loss. Until the security is replaced, the Fund is required to
pay to the lender amounts equal to any dividends or interest which accrue
during the period of the loan. To borrow the security, the Fund also may be
required to pay a premium, which would increase the cost of the security sold.
The proceeds of the short sale will be retained by the broker, to the extent
necessary to meet margin requirements, until the short position is closed out.

Until the Fund replaces a borrowed security in connection with a short
sale, the Fund will be required to maintain daily a segregated account,
containing cash or U.S. government securities, at such a level that (i) the
amount deposited in the account plus the amount deposited with the broker as
collateral will at all times be equal to at least 100% of the current value of
the security sold short, and (ii) the amount deposited in the

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<PAGE> 130
segregated account plus the amount deposited with the broker as collateral will
not be less than the market value of the security at the time it was sold
short.

The Fund will incur a loss as a result of a short sale if the price of
the security sold short increases between the date of the short sale and the
date on which the Fund replaces the borrowed security; conversely, the Fund
will realize a gain if the security declines in price between those dates.
This result is the opposite of what one would expect from a cash purchase of a
long position in a security. The amount of any gain will be decreased, and the
amount of any loss increased, by the amount of any premium or amounts in lieu
of interest the Fund may be required to pay in connection with a short sale.

In addition to the short sales discussed above, the Fund also may make
short sales "against the box," a transaction in which the Fund enters into a
short sale of a security which the Fund owns. The proceeds of the short sale
are held by a broker until the settlement date, at which time the Fund delivers
the security to close the short position. The Fund receives the net proceeds
from the short sale.

The ability of the Fund to effect short sales may be limited because
of certain requirements the Fund must satisfy to maintain its status as a
regulated investment company. See Accounting and Tax Issues - Other Tax
Requirements.

-16-
<PAGE> 131
ACCOUNTING AND TAX ISSUES

When the Fund writes a call, or purchases a put option, an amount
equal to the premium received or paid by it is included in the section of the
Fund's assets and liabilities as an asset and as an equivalent liability.

In writing a call, the amount of the liability is subsequently "marked
to market" to reflect the current market value of the option written. The
current market value of a written option is the last sale price on the
principal Exchange on which such option is traded or, in the absence of a sale,
the mean between the last bid and asked prices. If an option which the Fund
has written expires on its stipulated expiration date, the Fund reports a
realized gain. If the Fund enters into a closing purchase transaction with
respect to an option which the Fund has written, the Fund realizes a gain (or
loss if the cost of the closing transaction exceeds the premium received when
the option was sold) without regard to any unrealized gain or loss on the
underlying security, and the liability related to such option is extinguished.
Any such gain or loss is a short-term capital gain or loss for federal income
tax purposes. If a call option which the Fund has written is exercised, the
Fund realizes a capital gain or loss (long-term or short-term, depending on the
holding period of the underlying security) from the sale of the underlying
security and the proceeds from such sale are increased by the premium
originally received.

The premium paid by the Fund for the purchase of a put option is
recorded in the section of the Fund's assets and liabilities as an investment
and subsequently adjusted daily to the current market value of the option. For
example, if the current market value of the option exceeds the premium paid,
the excess would be unrealized appreciation and, conversely, if the premium
exceeds the current market value, such excess would be unrealized depreciation.
The current market value of a purchased option is the last sale price on the
principal Exchange on which such option is traded or, in the absence of a sale,
the mean between the last bid and asked prices. If an option which the Fund
has purchased expires on the stipulated expiration date, the Fund realizes a
short-term or long-term capital loss for federal income tax purposes in the
amount of the cost of the option. If the Fund sells the put option, it
realizes a short-term or long-term capital gain or loss, depending on whether
the proceeds from the sale are greater or less than the cost of the option. If
the Fund exercises a put option, it realizes a capital gain or loss (long-term
or short-term, depending on the holding period of the underlying security) from
the sale of the underlying security and the proceeds from such sale will be
decreased by the premium originally paid. However, since the purchase of a put
option is treated as a short sale for federal income tax purposes, the holding
period of the underlying security will be affected by such a purchase.

OPTIONS ON CERTAIN STOCK INDICES--Accounting for options on certain
stock indices will be in accordance with generally accepted accounting
principles. The amount of any realized gain or loss on closing out such a
position will result in a realized capital gain or loss for tax purposes. Such
options held by the Fund at the end of each fiscal year will be required to be
marked to market for federal income tax purposes. Sixty percent of any net
gain or loss recognized on such deemed sales or on any actual sales will be
treated as long-term capital gain or loss, and the remainder will be treated as
short-term capital gain or loss.

OTHER TAX REQUIREMENTS--Value Fund has qualified, and intends to
continue to qualify, and Retirement Income Fund intends to qualify as a
regulated investment company under Subchapter M of the Internal Revenue Code of
1986, as amended (the "Code"). A Fund must meet several requirements to
maintain its status as a regulated investment company. Among these requirements
are that at least 90% of its investment company taxable income be derived from
dividends, interest, payment with respect to securities loans and gains from
the sale or disposition of securities; that at the

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<PAGE> 132
close of each quarter of its taxable year at least 50% of the value of its
assets consists of cash and cash items, government securities, securities of
other regulated investment companies and, subject to certain diversification
requirements, other securities; and that less than 30% of its gross income be
derived from sales of securities held for less than three months.

The requirement that not more than 30% of a Fund's gross income be
derived from gains from the sale or other disposition of securities held for
less than three months may restrict a Fund in its ability to write covered call
options on securities which it has held less than three months, to write
options which expire in less than three months, to sell securities which have
been held less than three months and to effect closing purchase transactions
with respect to options which have been written less than three months prior to
such transactions. Consequently, in order to avoid realizing a gain within the
three-month period, a Fund may be required to defer the closing out of a
contract beyond the time when it might otherwise be advantageous to do so. A
Fund may also be restricted in the sale of purchased put options and the
purchase of put options for the purpose of hedging underlying securities
because of the application of the short sale holding period rules with respect
to such underlying securities.

The straddle rules of Section 1092 may apply. Generally, the straddle
provisions require the deferral of losses to the extent of unrecognized gains
related to the offsetting positions in the straddle. Excess losses, if any,
can be recognized in the year of loss. Deferred losses will be carried forward
and recognized in the following year, subject to the same limitation.

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<PAGE> 133
PERFORMANCE INFORMATION

From time to time, each Fund may state each of its Classes' total
return in advertisements and other types of literature. Any statement of total
return performance data for a Class will be accompanied by information on its
average annual compounded total rate of return for that Class over, as
relevant, the most recent one-, five- and ten-year (or life of fund, if
applicable) periods. Each Fund may also advertise aggregate and average total
return information of each Class over additional periods of time. The net
asset value of a Class fluctuates so shares, when redeemed, may be worth more
or less than the original investment, and a Class' results should not be
considered as representative of future performance.

Average annual total rate of return for a Class is based on a
hypothetical $1,000 investment that includes capital appreciation and
depreciation during the stated periods. The following formula will be used for
the actual computations:
n
P(1+T) = ERV

Where: P = a hypothetical initial purchase order of
$1,000 from which, in the case of only Class
A Shares, the maximum front-end sales charge
is deducted;

T = average annual total return;

n = number of years;

ERV = redeemable value of the hypothetical $1,000
purchase at the end of the period after the
deduction of the applicable CDSC, if any,
with respect to Class B Shares and Class C
Shares.

In presenting performance information for Class A Shares, the Limited
CDSC, applicable to only certain redemptions of those shares, will not be
deducted from any computation of total return. See the Prospectus for the Fund
Classes for a description of the Limited CDSC and the limited instances in
which it applies. All references to a CDSC in this Performance Information
section will apply to Class B Shares or Class C Shares.

Aggregate or cumulative total return is calculated in a similar
manner, except that the results are not annualized. Each calculation assumes
the maximum front-end sales charge, if any, is deducted from the initial $1,000
investment at the time it is made with respect to Class A Shares, and that all
distributions are reinvested at net asset value, and, with respect to Class B
Shares and Class C Shares, reflects the deduction of the CDSC that would be
applicable upon complete redemption of such shares. In addition, the Fund may
present total return information that does not reflect the deduction of the
maximum front-end sales charge or any applicable CDSC.

The performance of Class A Shares and the Institutional Class of Value
Fund, as shown below, is the average annual total return through May 31, 1996,
computed as described above. The average annual total return for Class A
Shares at offer reflects the maximum front-end sales charges paid on the
purchase of shares. The average annual total return for Class A Shares at net
asset value (NAV) does not reflect the payment of any front-end sales charge.
Pursuant to applicable regulation, total return shown for the Value Fund

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<PAGE> 134
Institutional Class for the periods prior to the commencement of operations of
such Class is calculated by taking the performance of Class A Shares and
adjusting it to reflect the elimination of all sales charges. However, for
those periods, no adjustment has been made to eliminate the impact of 12b-1
payments, and performance would have been affected had such an adjustment been
made.

<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN

VALUE FUND VALUE FUND VALUE FUND
A CLASS A CLASS INSTITUTIONAL
(AT OFFER)(2) (AT NAV) CLASS(3)
<S> <C> <C> <C>
1 year
ended
5/31/96 20.26% 26.28% 26.63%

3 years
ended
5/31/96 9.72% 11.53% 11.87%

5 years
ended
5/31/96 14.76% 15.89% 16.13%

Period
6/24/87(1)
through
5/31/96 14.15% 14.78% 14.92%
</TABLE>

(1) Date of initial public offering of Value Fund A Class.

(2) Prior to November 29, 1995, the maximum front-end sales charge was
5.75%. Effective November 29, 1995, the maximum front-end sales
charge was reduced to 4.75% and the above performance figures are
calculated using 4.75% as the applicable sales charge, and are more
favorable than they would have been had they been calculated using
5.75%.

(3) Date of initial public offering of Value Fund Institutional Class was
November 9, 1992.

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<PAGE> 135
The performance of Class B Shares of Value Fund, as shown below, is
the average annual total return quotation through May 31, 1996. The average
annual total return for Class B Shares including deferred sales charge reflects
the deduction of the applicable CDSC that would be paid if the shares were
redeemed at May 31, 1996. The average annual total return for Class B Shares
excluding deferred sales charge assumes the shares were not redeemed at May 31,
1996 and therefore does not reflect the deduction of a CDSC.

<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN

VALUE FUND B CLASS VALUE FUND B CLASS
(INCLUDING DEFERRED (EXCLUDING DEFERRED
SALES CHARGE) SALES CHARGE)
<S> <C> <C>
1 year
ended
5/31/96 21.31% 25.31%

Period
9/6/94(1)
through
5/31/96 12.64% 14.73%
</TABLE>

(1) Date of initial public offering of Value Fund B Class.

The performance of Class C Shares of Value Fund, as shown below, is
the aggregate total return quotation through May 31, 1996. The aggregate total
return for Class C Shares including deferred sales charge reflects the
deduction of the applicable CDSC that would be paid if the shares were redeemed
at May 31, 1996. The aggregate total return for Class C Shares excluding
deferred sales charge assumes the shares were not redeemed at May 31, 1996 and
therefore does not reflect the deduction of a CDSC.

<TABLE>
<CAPTION>
AGGREGATE TOTAL RETURN

VALUE FUND C CLASS VALUE FUND C CLASS
(INCLUDING DEFERRED (EXCLUDING DEFERRED
SALES CHARGE) SALES CHARGE)
<S> <C> <C>
Period
11/29/95(1)
through
5/31/96 11.81% 12.81%
</TABLE>

(1) Date of initial public offering of Value Fund C Class; total return
for this short of a time period may not be representative of
longer-term results.

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<PAGE> 136
Securities prices fluctuated during the periods covered and past
results should not be considered as representative of future performance.
Total return for the Retirement Income Fund is not provided because such shares
were not offered prior to the date of this Part B.

From time to time, each Fund may also quote its Classes' actual total
return performance, dividend results and other performance information in
advertising and other types of literature and may compare that information to,
or may separately illustrate similar information reported by, the Standard &
Poor's 500 Stock Index, the Dow Jones Industrial Average, the Russell 2000
Index TR, the NASDAQ Composite Index and other unmanaged indices.

The Standard & Poor's 500 Stock Index and the Dow Jones Industrial
Average are industry-accepted unmanaged indices of generally- conservative
securities used for measuring general market performance. The Russell 2000
Index TR is a total return weighted index which is comprised of 2,000 of the
smallest stocks (on the basis of capitalization) in the Russell 3000 Index and
is calculated on a monthly basis. The NASDAQ Composite Index is a market
capitalization price only index that tracks the performance of domestic common
stocks traded on the regular NASDAQ market as well as National Market System
traded foreign common stocks and American Depository Receipts. The total
return performance reported for these indices will reflect the reinvestment of
all distributions on a quarterly basis and market price fluctuations. The
indices do not take into account any sales charge or other fees. In seeking
its investment objective, the Value Fund's portfolio primarily includes common
stocks considered by the Manager to be more aggressive than those tracked by
these indices.

Total return performance of each Class will be computed by adding all
reinvested income and realized securities profits distributions plus the change
in net asset value during a specific period and dividing by the offering price
at the beginning of the period. It will not reflect any income taxes payable
by shareholders on the reinvested distributions included in the calculation.
Because securities prices fluctuate, past performance should not be considered
as a representation of the results which may be realized from an investment in
the Fund in the future.

Each Fund may also state its Classes' total return performance in the
form of an average annual return. This average annual return figure will be
computed by taking the sum of annual returns, then dividing that figure by the
number of years in the overall period indicated. The computation will reflect
the impact of the maximum front-end or contingent deferred sales charge, if
any, paid on the illustrated investment amount against the first year's return.

From time to time, each Fund may also quote actual total return
performance for its Classes in advertising and other types of literature
compared to indices or averages of alternative financial products available to
prospective investors. For example, the performance comparisons may include
the average return of various bank instruments, some of which may carry certain
return guarantees offered by leading banks and thrifts as monitored by Bank
Rate Monitor, and those of generally-accepted corporate bond and government
security price indices of various durations prepared by Lehman Brothers and
Salomon Brothers, Inc. These indices are not managed for any investment goal.

Comparative information on the Consumer Price Index may also be
included. The Consumer Price Index, as prepared by the U.S. Bureau of Labor
Statistics, is the most commonly used measure of inflation. It indicates the
cost fluctuations of a representative group of consumer goods. It does not
represent a return from an investment.

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<PAGE> 137

Statistical and performance information and various indices compiled
and maintained by organizations such as the following may also be used in
preparing exhibits comparing certain industry trends and competitive mutual
fund performance to comparable Fund activity and performance and in
illustrating general financial planning principles. From time to time, certain
mutual fund performance ranking information, calculated and provided by these
organizations may also be used in the promotion of sales of the Funds. Any
indices used are not managed for any investment goal.

CDA Technologies, Inc., Lipper Analytical Services, Inc. and
Morningstar, Inc. are performance evaluation services that maintain
statistical performance databases, as reported by a diverse universe
of independently-managed mutual funds.

Ibbotson Associates, Inc. is a consulting firm that provides a variety
of historical data including total return, capital appreciation and
income on the stock market as well as other investment asset classes,
and inflation. With their permission, this information will be used
primarily for comparative purposes and to illustrate general financial
planning principles.

Interactive Data Corporation is a statistical access service that
maintains a database of various international industry indicators,
such as historical and current price/earning information, individual
equity and fixed-income price and return information.

Compustat Industrial Databases, a service of Standard & Poor's, may
also be used in preparing performance and historical stock and bond
market exhibits. This firm maintains fundamental databases that
provide financial, statistical and market information covering more
than 7,000 industrial and non-industrial companies.

Russell Indexes is an investment analysis service that provides both
current and historical stock performance information, focusing on the
business fundamentals of those firms issuing the security.

Salomon Brothers and Lehman Brothers are statistical research firms
that maintain databases of international market, bond market,
corporate and government-issued securities of various maturities.
This information, as well as unmanaged indices compiled and maintained
by these firms, will be used in preparing comparative illustrations.
In addition, the performance of multiple indices compiled and
maintained by these firms may be combined to create a blended
performance result for comparative performances. Generally, the
indices selected will be representative of the types of securities in
which the Funds may invest and the assumptions that were used in
calculating the blended performance will be described.

The following tables are examples, for purposes of illustration only,
of cumulative total return performance for Class A Shares, Class B Shares,
Class C Shares and the Institutional Class of Value Fund through May 31, 1996.
For these purposes, the calculations assume the reinvestment of any realized
securities profits distributions and income dividends paid during the period.
Comparative information on the Standard & Poor's 500 Stock Index, the Dow Jones
Industrial Average and the NASDAQ Composite Index is also included.

-23-
<PAGE> 138
<TABLE>
<CAPTION>
CUMULATIVE TOTAL RETURN

VALUE
FUND STANDARD
VALUE FUND INSTITU- & POOR'S DOW JONES NASDAQ
A CLASS(2) TIONAL 500 STOCK INDUSTRIAL COMPOSITE
(AT OFFER) CLASS(3) INDEX(4) AVERAGE(4) INDEX(4)
<S> <C> <C> <C> <C> <C>
3 months
ended
5/31/96 1.64% 6.76% 5.09% 3.46% 13.03%

6 months
ended
5/31/96 6.62% 12.12% 11.78% 12.49% 17.39%

9 months
ended
5/31/96 12.11% 17.95% 21.19% 24.57% 21.89%

1 year
ended
5/31/96 20.26% 26.63% 28.44% 29.44% 43.82%

3 years
ended
5/31/96 33.24% 40.00% 60.95% 73.16% 77.50%

5 years
ended
5/31/96 99.05% 111.26% 97.33% 114.39% 145.68%

Period
6/24/87(1)
through
5/31/96 226.42% 246.55% 190.36% 211.20% 192.80%
</TABLE>

(1) Date of initial public offering of Value Fund A Class.

(3) Date of initial public offering of Value Fund Institutional Class was
November 9, 1992. Pursuant to applicable regulation, total return
shown for the Institutional Class for the periods prior to the
commencement of operations of such Class is calculated by taking the
performance of Class A Shares and adjusting it to reflect the
elimination of all sales charges. However, for those periods, no
adjustment has been made to eliminate the impact of 12b-1 payments,
and performance would have been affected had such an adjustment been
made.

(4) Source: Interactive Data Corp.

-24-
<PAGE> 139
<TABLE>
<CAPTION>
CUMULATIVE TOTAL RETURN

VALUE FUND VALUE FUND
B CLASS B CLASS
(INCLUDING (EXCLUDING STANDARD
DEFERRED DEFERRED & POOR'S DOW JONES NASDAQ
SALES SALES 500 STOCK INDUSTRIAL COMPOSITE
CHARGE) CHARGE) INDEX(2) AVERAGE(2) INDEX(2)
<S> <C> <C> <C> <C> <C>
3 months
ended
5/31/96 2.49% 6.49% 5.09% 3.46% 13.03%

6 months
ended
5/31/96 7.55% 11.55% 11.78% 12.49% 17.39%

9 months
ended
5/31/96 13.05% 17.05% 21.19% 24.57% 21.89%

1 year
ended
5/31/96 21.31% 25.31% 28.44% 29.44% 43.82%

Period
9/6/94(1)
through
5/31/96 22.92% 26.92% 47.18% 50.80% 62.41%
</TABLE>

(1) Date of initial public offering of Value Fund B Class.

(2) Source: Interactive Data Corp.

-25-
<PAGE> 140
<TABLE>
<CAPTION>
CUMULATIVE TOTAL RETURN

VALUE FUND VALUE FUND
C CLASS C CLASS STANDARD
(INCLUDING (EXCLUDING & POOR'S DOW JONES NASDAQ
DEFERRED DEFERRED 500 STOCK INDUSTRIAL COMPOSITE
SALES CHARGE) SALES CHARGE) INDEX AVERAGE INDEX
<S> <C> <C> <C> <C> <C>
3 months
ended
5/31/96 5.59% 6.59% 5.09% 5.09% 13.03%

Period
11/29/95(1)
through
5/31/96 11.81% 12.81% 11.78% 12.49% 17.39%
</TABLE>

(1) Date of initial public offering of Value Fund C Class; total return
for this short of a time period may not be representative of
longer-term results.

Total return for the Retirement Income Fund is not provided because
such shares were not offered prior to the date of this Part B.

Because every investor's goals and risk threshold are different, the
Distributor, as distributor for each Fund and other mutual funds in the
Delaware Group, will provide general information about investment alternatives
and scenarios that will allow investors to assess their personal goals. This
information will include general material about investing as well as materials
reinforcing various industry-accepted principles of prudent and responsible
financial planning. One typical way of addressing these issues is to compare
an individual's goals and the length of time the individual has to attain these
goals to his or her risk threshold. In addition, the Distributor will provide
information that discusses the Manager's overriding investment philosophy and
how that philosophy impacts the Funds', and other Delaware Group funds',
investment disciplines employed in seeking their objectives. The Distributor
may also from time to time cite general or specific information about the
institutional clients of the Manager, including the number of such clients
serviced by the Manager.

DOLLAR-COST AVERAGING
For many people, deciding when to invest can be a difficult decision.
Security prices tend to move up and down over various market cycles and logic
says to invest when prices are low. However, even experts can't always pick
the highs and the lows. By using a strategy known as dollar-cost averaging,
you schedule your investments ahead of time. If you invest a set amount on a
regular basis, that money will always buy more shares when the price is low and
fewer when the price is high. You can choose to invest at any regular
interval--for example, monthly or quarterly--as long as you stick to your
regular schedule. Dollar-cost averaging looks simple and it is, but there are
important things to remember.

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<PAGE> 141
Dollar-cost averaging works best over longer time periods, and it
doesn't guarantee a profit or protect against losses in declining markets. If
you need to sell your investment when prices are low, you may not realize a
profit no matter what investment strategy you utilize. That's why dollar-cost
averaging can make sense for long-term goals. Since the potential success of a
dollar-cost averaging program depends on continuous investing, even through
periods of fluctuating prices, you should consider your dollar-cost averaging
program a long-term commitment and invest an amount you can afford and probably
won't need to withdraw. Investors also should consider their financial ability
to continue to purchase shares during periods of low fund share prices.
Delaware Group offers three services -- Automatic Investing Program, Direct
Deposit Program and the Wealth Builder Option -- that can help to keep your
regular investment program on track. See Investing by Electronic Fund Transfer
- - Direct Deposit Purchase Plan and Automatic Investing Plan under Investment
Plans and Wealth Builder Option under Investment Plans for a complete
description of these services, including restrictions or limitations.

The example below illustrates how dollar-cost averaging can work. In
a fluctuating market, the average cost per share over a period of time will be
lower than the average price per share for the same time period.

<TABLE>
<CAPTION>
NUMBER
INVESTMENT PRICE PER OF SHARES
AMOUNT SHARE PURCHASED
<S> <C> <C> <C>
Month 1 $100 $10.00 10
Month 2 $100 $12.50 8
Month 3 $100 $ 5.00 20
Month 4 $100 $10.00 10

----------------------------------------------------------
$400 $37.50 48
</TABLE>

Total Amount Invested: $400
Total Number of Shares Purchased: 48
Average Price Per Share: $9.38 ($37.50/4)
Average Cost Per Share: $8.33 ($400/48 shares)

This example is for illustration purposes only. It is not intended to
represent the actual performance of a Fund.

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<PAGE> 142
THE POWER OF COMPOUNDING
When you opt to reinvest your current income for additional Fund
shares, your investment is given yet another opportunity to grow. It's called
the Power of Compounding and the following chart illustrates just how powerful
it can be.

COMPOUNDED RETURNS
Results at various assumed fixed rates of return on a $10,000
investment compounded quarterly for 10 years:

<TABLE>
<CAPTION>
9% 11% 13%
Rate of Rate of Rate of
Return Return Return
------ ------ ------
<S> <C> <C> <C>
1 year $10,931 $11,146 $11,365
2 years $11,948 $12,424 $12,916
3 years $13,060 $13,848 $14,679
4 years $14,276 $15,435 $16,682
5 years $15,605 $17,204 $18,959
6 years $17,057 $19,176 $21,546
7 years $18,645 $21,374 $24,487
8 years $20,381 $23,824 $27,829
9 years $22,278 $26,554 $31,627
10 years $24,352 $29,598 $35,943
</TABLE>

These figures are calculated assuming a fixed constant investment
return and assume no fluctuation in the value of principal. These figures,
which do not reflect payment of applicable taxes, are not intended to be a
projection of investment results and do not reflect the actual performance
results of any of the Classes.

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<PAGE> 143
TRADING PRACTICES AND BROKERAGE

Each Fund selects brokers or dealers to execute transactions for the
purchase or sale of portfolio securities on the basis of its judgment of their
professional capability to provide the service. The primary consideration is
to have brokers or dealers execute transactions at best price and execution.
Best price and execution refers to many factors, including the price paid or
received for a security, the commission charged, the promptness and reliability
of execution, the confidentiality and placement accorded the order and other
factors affecting the overall benefit obtained by the account on the
transaction. A number of trades are made on a net basis where a Fund either
buys the securities directly from the dealer or sells them to the dealer. In
these instances, there is no direct commission charged but there is a spread
(the difference between the buy and sell price) which is the equivalent of a
commission. When a commission is paid, a Fund pays reasonably competitive
brokerage commission rates based upon the professional knowledge of its trading
department as to rates paid and charged for similar transactions throughout the
securities industry. In some instances, a Fund pays a minimal share
transaction cost when the transaction presents no difficulty.

During the fiscal years ended November 30, 1993, 1994 and 1995, the
aggregate dollar amounts of brokerage commissions paid by the Value Fund were
$252,502, $89,843 and $384,243, respectively. The aggregate dollar amount of
brokerage commissions paid for 1993 was higher due to the large number of
purchases made to the Fund during that year.

The Manager may allocate out of all commission business generated by
all of the funds and accounts under its management, brokerage business to
brokers or dealers who provide brokerage and research services. These services
include advice, either directly or through publications or writings, as to the
value of securities, the advisability of investing in, purchasing or selling
securities, and the availability of securities or purchasers or sellers of
securities; furnishing of analyses and reports concerning issuers, securities
or industries; providing information on economic factors and trends; assisting
in determining portfolio strategy; providing computer software and hardware
used in security analyses; and providing portfolio performance evaluation and
technical market analyses. Such services are used by the Manager in connection
with its investment decision-making process with respect to one or more funds
and accounts managed by it, and may not be used, or used exclusively, with
respect to the fund or account generating the brokerage.

During the fiscal year ended November 30, 1995, portfolio transactions
of the Value Fund in the amount of $37,590,393, resulting in brokerage
commissions of $135,992, were directed to brokers for brokerage and research
services provided.

As provided in the Securities Exchange Act of 1934 and the Fund's
Investment Management Agreement, higher commissions are permitted to be paid to
broker/dealers who provide brokerage and research services than to
broker/dealers who do not provide such services if such higher commissions are
deemed reasonable in relation to the value of the brokerage and research
services provided. Although transactions are directed to broker/dealers who
provide such brokerage and research services, the Funds believe that the
commissions paid to such broker/dealers are not, in general, higher than
commissions that would be paid to broker/dealers not providing such services
and that such commissions are reasonable in relation to the value of the
brokerage and research services provided. In some instances, services may be
provided to the Manager which constitute in some part brokerage and research
services used by the Manager in connection with its investment decision-making
process and constitute in some part services used by the Manager in connection

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<PAGE> 144
with administrative or other functions not related to its investment
decision-making process. In such cases, the Manager will make a good faith
allocation of brokerage and research services and will pay out of its own
resources for services used by the Manager in connection with administrative or
other functions not related to its investment decision-making process. In
addition, so long as no fund is disadvantaged, portfolio transactions which
generate commissions or their equivalent are allocated to broker/dealers who
provide daily portfolio pricing services to the Funds and to other funds in the
Delaware Group. Subject to best price and execution, commissions allocated to
brokers providing such pricing services may or may not be generated by the
funds receiving the pricing service.

The Manager may place a combined order for two or more accounts or
funds engaged in the purchase or sale of the same security if, in its judgment,
joint execution is in the best interest of each participant and will result in
best price and execution. Transactions involving commingled orders are
allocated in a manner deemed equitable to each account or fund. When a
combined order is executed in a series of transactions at different prices,
each account participating in the order may be allocated an average price
obtained from the executing broker. It is believed that the ability of the
accounts to participate in volume transactions will generally be beneficial to
the accounts and funds. Although it is recognized that, in some cases, the
joint execution of orders could adversely affect the price or volume of the
security that a particular account or fund may obtain, it is the opinion of the
Manager and Equity Funds V, Inc.'s Board of Directors that the advantages of
combined orders outweigh the possible disadvantages of separate transactions.

Consistent with the Rules of Fair Practice of the National Association
of Securities Dealers, Inc. (the "NASD"), and subject to seeking best price and
execution, the Fund may place orders with broker/dealers that have agreed to
defray certain Fund expenses such as custodian fees, and may, at the request of
the Distributor, give consideration to sales of Fund shares as a factor in the
selection of brokers and dealers to execute Fund portfolio transactions.

PORTFOLIO TURNOVER
Portfolio trading will be undertaken principally to accomplish each
Fund's objective in relation to anticipated movements in the general level of
interest rates. Each Fund is free to dispose of portfolio securities at any
time, subject to complying with the Code and the 1940 Act, when changes in
circumstances or conditions make such a move desirable in light of the
investment objective. A Fund will not attempt to achieve or be limited to a
predetermined rate of portfolio turnover, such a turnover always being
incidental to transactions undertaken with a view to achieving the Fund's
investment objective.

Under certain market conditions, the Funds may experience high rates
of portfolio turnover which could exceed 100%. The portfolio turnover rate of
a Fund is calculated by dividing the lesser of purchases or sales of portfolio
securities for the particular fiscal year by the monthly average of the value
of the portfolio securities owned by the Fund during the particular fiscal
year, exclusive of securities whose maturities at the time of acquisition are
one year or less.

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<PAGE> 145
The degree of portfolio activity may affect brokerage costs of a Fund
and taxes payable by the Fund's shareholders to the extent of any net realized
capital gains. A turnover rate of 100% would occur, for example, if all the
investments in a Fund's portfolio at the beginning of the year were replaced by
the end of the year. Portfolio turnover will also be increased if a Fund
writes a large number of call options which are subsequently exercised. The
turnover rate also may be affected by cash requirements from redemptions and
repurchases of Fund shares. Total brokerage costs generally increase with
higher portfolio turnover rates. In investing for capital appreciation, the
Value Fund may hold securities for any period of time.

During the fiscal years ended November 30, 1994 and 1995, Value Fund's
portfolio turnover rates were 14% and 65%, respectively.

-31-
<PAGE> 146

PURCHASING SHARES

The Distributor serves as the national distributor for each Fund's
four classes of shares - Class A Shares, Class B Shares, Class C Shares and the
Institutional Class, and has agreed to use its best efforts to sell shares of
each Fund. See the Prospectuses for information on how to invest. Shares of
each Fund are offered on a continuous basis and may be purchased through
authorized investment dealers or directly by contacting Equity Funds V, Inc. or
the Distributor.

The minimum initial investment generally is $1,000 for Class A Shares,
Class B Shares and Class C Shares. Subsequent purchases generally must be at
least $100. The initial and subsequent investment minimums for Class A Shares
will be waived for purchases by officers, directors and employees of any
Delaware Group fund, the Manager or any of the Manager's affiliates if the
purchases are made pursuant to a payroll deduction program. Shares purchased
pursuant to the Uniform Gifts to Minors Act or Uniform Transfers to Minors Act
and shares purchased in connection with an Automatic Investing Plan are subject
to a minimum initial purchase of $250 and a minimum subsequent purchase of $25.
Accounts opened under the Delaware Group Asset Planner service are subject to a
minimum initial investment of $2,000 per Asset Planner Strategy selected.
There are no minimum purchase requirements for the Institutional Classes, but
certain eligibility requirements must be satisfied.

Each purchase of Class B Shares is subject to a maximum purchase
limitation of $250,000. For Class C Shares, each purchase must be in an amount
that is less than $1,000,000. See Investment Plans for purchase limitations
applicable to retirement plans. Equity Funds V, Inc. will reject any purchase
order for more than $250,000 of Class B Shares and $1,000,000 or more of Class
C Shares. An investor may exceed these limitations by making cumulative
purchases over a period of time. An investor should keep in mind, however,
that reduced front-end sales charges apply to investments of $100,000 or more
in Class A Shares, and that Class A Shares, absent any applicable fee waiver,
are subject to lower annual 12b-1 Plan expenses than Class B Shares and Class C
Shares and generally are not subject to a CDSC.

Selling dealers have the responsibility of transmitting orders
promptly. Equity Funds V, Inc. reserves the right to reject any order for the
purchase of its shares if in the opinion of management such rejection is in the
Funds' best interest.

The NASD has adopted amendments to its Rules of Fair Practice relating
to investment company sales charges. Equity Funds V, Inc. and the Distributor
intend to operate in compliance with these rules.

Class A Shares are purchased at the offering price which reflects a
maximum front-end sales charge of 4.75%; however, lower front-end sales charges
apply for larger purchases. See the table below. Class A Shares, absent any
applicable fee waivers, are also subject to annual 12b-1 Plan expenses.

Class B Shares are purchased at net asset value and are subject to a
CDSC of: (i) 4% if shares are redeemed within two years of purchase; (ii) 3%
if shares are redeemed during the third or fourth year following purchase;
(iii) 2% if shares are redeemed during the fifth year following purchase; and
(iv) 1% if shares are redeemed during the sixth year following purchase. Class
B Shares are also subject to annual 12b-1 Plan expenses which, absent any
applicable fee waiver, are higher than those to which Class A Shares are
subject and are assessed against the Class B Shares for approximately eight
years after purchase. See Automatic Conversion of Class B Shares under Classes
of Shares in the Fund Classes' Prospectuses.

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<PAGE> 147

Class C Shares are purchased at net asset value and are subject to a
CDSC of 1% if shares are redeemed within 12 months following purchase. Class C
Shares, absent any applicable fee waivers, are also subject to annual 12b-1
Plan expenses for the life of the investment which are equal to those to which
Class B Shares are subject.

The Distributor has voluntarily elected to waive the payment of 12b-1
Plan expenses by the Retirement Income Fund from the commencement of the public
offering through May 31, 1997.

Institutional Class shares are purchased at the net asset value per
share without the imposition of a front-end or contingent deferred sales
charge, or 12b-1 Plan expenses. See Determining Offering Price and Net Asset
Value and Plans Under Rule 12b-1 for the Fund Classes in this Part B.

Class A Shares, Class B Shares, Class C Shares and Institutional Class
shares represent a proportionate interest in a Fund's assets and will receive a
proportionate interest in that Fund's income, before application, as to the
Class A, Class B and Class C Shares, of any expenses, if any, under that Fund's
12b-1 Plans.

Certificates representing shares purchased are not ordinarily issued
unless, in the case of Class A Shares or Institutional Class shares, a
shareholder submits a specific request. Certificates are not issued in the
case of Class B Shares or Class C Shares. However, purchases not involving the
issuance of certificates are confirmed to the investor and credited to the
shareholder's account on the books maintained by Delaware Service Company, Inc.
(the "Transfer Agent"). The investor will have the same rights of ownership
with respect to such shares as if certificates had been issued. An investor
that is permitted to obtain a certificate may receive a certificate
representing shares purchased by sending a letter to the Transfer Agent
requesting the certificate. No charge is assessed by Equity Funds V, Inc. for
any certificate issued. Investors who hold certificates representing any of
their shares may only redeem those shares by written request. The investor's
certificate(s) must accompany such request.

ALTERNATIVE PURCHASE ARRANGEMENTS

The alternative purchase arrangements of Class A, Class B and Class C
Shares permit investors to choose the method of purchasing shares that is most
suitable for their needs given the amount of their purchase, the length of time
they expect to hold their shares and other relevant circumstances. Investors
should determine whether, given their particular circumstances, it is more
advantageous to purchase Class A Shares and incur a front-end sales charge and,
absent any applicable fee waiver, annual 12b-1 Plan expenses of up to a maximum
of 0.30% of the average daily net assets of Class A Shares or to purchase
either Class B or Class C Shares and have the entire initial purchase amount
invested in a Fund with the investment thereafter subject to a CDSC and,
absent any applicable fee waivers, annual 12b-1 Plan expenses. Class B Shares
are subject to a CDSC if the shares are redeemed within six years of purchase,
and Class C Shares are subject to a CDSC if the shares are redeemed within 12
months of purchase. Class B and Class C Shares are each subject to annual
12b-1 Plan expenses of up to a maximum of 1% (0.25% of which are service fees
to be paid to the Distributor, dealers or others for providing personal service
and/or maintaining shareholder accounts) of average daily net assets of the
respective Class. Class B Shares will automatically convert to Class A Shares
at the end of approximately eight years after purchase and, thereafter, be
subject to annual 12b-1 Plan expenses of up to a maximum of 0.30% of average
daily net assets of such shares. Unlike Class B Shares, Class C Shares do not
convert to another class.

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<PAGE> 148
CLASS A SHARES - VALUE FUND AND RETIREMENT INCOME FUND
Purchases of $100,000 or more of Class A Shares at the offering price
carry reduced front-end sales charges as shown in the accompanying table, and
may include a series of purchases over a 13-month period under a Letter of
Intention signed by the purchaser. See Special Purchase Features - Class A
Shares, below for more information on ways in which investors can avail
themselves of reduced front-end sales charges and other purchase features.

VALUE FUND
RETIREMENT INCOME FUND
CLASS A SHARES

________________________________________________________________________________
<TABLE>
<CAPTION>
Dealer's
Front-End Sales Charge as % of Commission***
Amount of Purchase Offering Amount as % of
Price Invested** Offering Price
____________________________________________________________________________________________________________
Retirement Income
Value Fund Fund
<S> <C> <C> <C> <C>
Less than $100,000 4.75% 5.01% 4.94% 4.00%
$100,000 but under $250,000 3.75 3.92 3.89 3.00
$250,000 but under $500,000 2.50 2.55 2.59 2.00
$500,000 but under $1,000,000* 2.00 2.03 2.00 1.60
</TABLE>

* There is no front-end sales charge on purchases of $1 million or more
of Class A Shares but, under certain limited circumstances, a 1%
contingent deferred sales charge may apply upon redemption of such
shares. The contingent deferred sales charge ("Limited CDSC") that
may be applicable arises only in the case of certain shares that were
purchased at net asset value and triggered the payment of a dealer's
commission.

** In the case of Value Fund, based on the net asset value per share of
Class A Shares as of the end of Equity Funds V, Inc.'s most recent
fiscal year. In the case of Retirement Income Fund based on an
initial net asset value of $8.50 per share.

*** Financial institutions or their affiliated brokers may receive an
agency transaction fee in the percentages set forth above.
________________________________________________________________________________

A Fund must be notified when a sale takes place which would qualify
for the reduced front-end sales charge on the basis of previous or
current purchases. The reduced front-end sales charge will be granted
upon confirmation of the shareholder's holdings by such Fund. Such
reduced front-end sales charges are not retroactive.

From time to time, upon written notice to all of its dealers, the
Distributor may hold special promotions for specified periods during
which the Distributor may reallow to dealers up to the full amount of
the front-end sales charge shown above. Dealers who receive 90% or
more of the sales charge may be deemed to be underwriters under the
Securities Act of 1933.
________________________________________________________________________________

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<PAGE> 149
Certain dealers who enter into an agreement to provide extra training
and information on Delaware Group products and services and who increase sales
of Delaware Group funds may receive an additional commission of up to 0.15% of
the offering price in connection with sales of Class A Shares. Such dealers
must meet certain requirements in terms of organization and distribution
capabilities and their ability to increase sales. The Distributor should be
contacted for further information on these requirements as well as the basis
and circumstances upon which the additional commission will be paid.
Participating dealers may be deemed to have additional responsibilities under
the securities laws.

DEALER'S COMMISSION
For initial purchases of Class A Shares of $1,000,000 or more, a
dealer's commission may be paid by the Distributor to financial advisers
through whom such purchases are effected in accordance with the following
schedule:

<TABLE>
<CAPTION>
DEALER'S COMMISSION
-------------------
(as a percentage of
AMOUNT OF PURCHASE amount purchased)
------------------
<S> <C>
Up to $2 million 1.00%
Next $1 million up to $3 million 0.75
Next $2 million up to $5 million 0.50
Amount over $5 million 0.25
</TABLE>

In determining a financial adviser's eligibility for the dealer's
commission, purchases of Class A Shares of other Delaware Group funds as to
which a Limited CDSC applies (see Contingent Deferred Sales Charge for Certain
Redemptions of Class A Shares Purchased at Net Asset Value under Redemption and
Exchange in the Fund Classes' Prospectuses) may be aggregated with those of the
Class A Shares of a Fund. Financial advisers also may be eligible for a
dealer's commission in connection with certain purchases made under a Letter of
Intention or pursuant to an investor's Right of Accumulation. Financial
advisers should contact the Distributor concerning the applicability and
calculation of the dealer's commission in the case of combined purchases.

CONTINGENT DEFERRED SALES CHARGE - CLASS B SHARES AND CLASS C SHARES
Class B and Class C Shares are purchased without a front-end sales
charge. Class B Shares redeemed within six years of purchase may be subject to
a CDSC at the rates set forth below, and Class C Shares redeemed within 12
months of purchase may be subject to a CDSC of 1%. CDSCs are charged as a
percentage of the dollar amount subject to the CDSC. The charge will be
assessed on an amount equal to the lesser of the net asset value at the time of
purchase of the shares being redeemed or the net asset value of those shares at
the time of redemption. No CDSC will be imposed on increases in net asset
value above the initial purchase price, nor will a CDSC be assessed on
redemptions of shares acquired through reinvestment of dividends or capital
gains distributions. See Waiver of Contingent Deferred Sales Charge - Class B
and Class

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<PAGE> 150

C Shares under Redemption and Exchange in the Prospectuses for the Fund Classes
for a list of the instances in which the CDSC is waived.

The following table sets forth the rates of the CDSC for Class B
Shares of each Fund:

During the seventh year after purchase and, thereafter, until converted
automatically into Class A Shares, Class B Shares, absent any applicable fee
waivers, will still be subject to the annual 12b-1 Plan expenses of up to 1% of
average daily net assets of those shares. At the end of approximately eight
years after purchase, the investor's Class B Shares will be automatically
converted into Class A Shares of the same Fund. See Automatic Conversion of
Class B Shares under Classes of Shares in the Fund Classes' Prospectuses. Such
conversion will constitute a tax-free exchange for federal income tax purposes.
See Taxes in the Prospectuses for the Fund Classes.

PLANS UNDER RULE 12B-1 FOR THE FUND CLASSES
Pursuant to Rule 12b-1 under the 1940 Act, Equity Funds V, Inc. has
adopted a separate plan for each of the Class A Shares, Class B Shares and
Class C Shares of each Fund (the "Plans"). Each Plan permits the relevant Fund
to pay for certain distribution, promotional and related expenses involved in
the marketing of only the Class to which the Plan applies. The Plans do not
apply to the Institutional Classes of shares. Such shares are not included in
calculating the Plans' fees, and the Plans are not used to assist in the
distribution and marketing of shares of the Institutional Classes.
Shareholders of the Institutional Classes may not vote on matters affecting the
Plans.

The Plans permit a Fund, pursuant to its Distribution Agreement, to
pay out of the assets of the Class A Shares, Class B Shares and Class C Shares
monthly fees to the Distributor for its services and expenses in distributing
and promoting sales of shares of such classes. These expenses include, among
other things, preparing and distributing advertisements, sales literature and
prospectuses and reports used for sales purposes, compensating sales and
marketing personnel, and paying distribution and maintenance fees to securities
brokers and dealers who enter into agreements with the Distributor. The Plan
expenses relating to Class B and Class C Shares are also used to pay the
Distributor for advancing the commission costs to dealers with respect to the
initial sale of such shares.

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<PAGE> 151

In addition, absent any applicable fee waiver, each Fund may make
payments out of the assets of the Class A, Class B and Class C Shares directly
to other unaffiliated parties, such as banks, who either aid in the
distribution of shares of, or provide services to, such classes.

The maximum aggregate fee payable by a Fund under its Plans, and the
Fund's Distribution Agreement, is on an annual basis, 0.30% of the Class A
Shares' average daily net assets for the year, and 1% (0.25% of which are
service fees to be paid to the Distributor, dealers and others for providing
personal service and/or maintaining shareholder accounts) of each of the Class
B Shares' and the Class C Shares' average daily net assets for the year.
Equity Funds V, Inc.'s Board of Directors may reduce these amounts at any time.
The Distributor has elected voluntarily to waive all payments under the 12b-1
Plan for the Class A Shares, Class B Shares and Class C Shares of the
Retirement Income Fund during the commencement of the public offering of the
Fund through May 31, 1997.

All of the distribution expenses incurred by the Distributor and
others, such as broker/dealers, in excess of the amount paid on behalf of Class
A, Class B and Class C Shares would be borne by such persons without any
reimbursement from such classes. Subject to seeking best price and execution,
a Fund may, from time to time, buy or sell portfolio securities from or to
firms which receive payments under its Plans.

From time to time, the Distributor may pay additional amounts from its
own resources to dealers for aid in distribution or for aid in providing
administrative services to shareholders.

The Plans and the Distribution Agreements, as amended, have been
approved by the Board of Directors of Equity Funds V, Inc., including a
majority of the directors who are not "interested persons" (as defined in the
1940 Act) of Equity Funds V, Inc. and who have no direct or indirect financial
interest in the Plans, by vote cast in person at a meeting duly called for the
purpose of voting on the Plans and such Agreements. Continuation of the Plans
and the Distribution Agreements, as amended, must be approved annually by the
Board of Directors in the same manner as specified above.

Each year, the directors must determine whether continuation of the
Plans is in the best interest of shareholders of, respectively, Class A Shares,
Class B Shares and Class C Shares and that there is a reasonable likelihood of
the Plan relating to a Fund Class providing a benefit to that Class. The Plans
and the Distribution Agreements, as amended, may be terminated with respect to a
Fund Class at any time without penalty by a majority of those directors who are
not "interested persons" or by a majority vote of the outstanding voting
securities of the relevant Fund Class. Any amendment materially increasing the
percentage payable under the Plans must likewise be approved by a majority vote
of the outstanding voting securities of the relevant Fund Class, as well as by
a majority vote of those directors who are not "interested persons." With
respect to the Class A Shares' Plan, any material increase in the maximum
percentage payable thereunder must also be approved by a majority of the
outstanding voting securities of the Class B Shares. Also, any other material
amendment to the Plans must be approved by a majority vote of the directors
including a majority of the noninterested directors of Equity Funds V, Inc.
having no interest in the Plans. In addition, in order for the Plans to remain
effective, the selection and nomination of directors who are not "interested
persons" of Equity Funds V, Inc. must be effected by the directors who
themselves are not "interested persons" and who have no direct or indirect
financial interest in the Plans. Persons authorized to make payments under the
Plans must provide written reports at least quarterly to the Board of Directors
for their review.

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<PAGE> 152

For the fiscal year ended November 30, 1995, payments from the Value
Fund A Class pursuant to its Plan amounted to $524,840 and such amount was used
for the following purposes: $6,948 - Annual/Semi-Annual Reports; $422,983 -
Broker Trails; $35,278 - Commission to Wholesalers; $1,821 - Dealer Service
Expenses; $12,986 - Promotional-Other; $7,731 - Promotional-Broker Meetings;
$8,030 - Prospectus Printing; $26,880 - Wholesaler Expenses; and $2,183 -
Telephone.

For the fiscal year ended November 30, 1995, payments from the Value
Fund B Class pursuant to its Plan amounted to $34,976 and such amount was used
for the following purposes: $11,507 - Broker Sales Charges; $8,646 - Broker
Trails; $1,588 - Commission to Wholesalers; $12,975 - Interest on Broker Sales
Charges; $47 - Telephone; and $213 - Promotional-Broker Meetings. For the
period November 29, 1995 (date of initial public offering) through November 30,
1995, there were no payments from the Class C Shares pursuant to its Plan.

OTHER PAYMENTS TO DEALERS - CLASS A, CLASS B AND CLASS C SHARES
From time to time, at the discretion of the Distributor, all
registered broker/dealers whose aggregate sales of Fund Classes exceed certain
limits as set by the Distributor, may receive from the Distributor an
additional payment of up to 0.25% of the dollar amount of such sales. The
Distributor may also provide additional promotional incentives or payments to
dealers that sell shares of the Delaware Group of funds. In some instances,
these incentives or payments may be offered only to certain dealers who
maintain, have sold or may sell certain amounts of shares.

Payments to dealers made in connection with seminars, conferences or
contests relating to the promotion of Fund shares may be in an amount up to
100% of the expenses incurred or awards made. The Distributor may also pay a
portion of the expense of preapproved dealer advertisements promoting the sale
of Delaware Group fund shares.

SPECIAL PURCHASE FEATURES - CLASS A SHARES

BUYING CLASS A SHARES AT NET ASSET VALUE
Class A Shares may be purchased without a front-end sales charge under
the Dividend Reinvestment Plan and, under certain circumstances, the Exchange
Privilege and the 12-Month Reinvestment Privilege.

Current and former officers, directors and employees of Equity Funds
V, Inc., any other fund in the Delaware Group, the Manager, or any of the
Manager's affiliates that may in the future be created, legal counsel to the
funds and registered representatives and employees of broker/dealers who have
entered into Dealer's Agreements with the Distributor may purchase Class A
Shares and any such class of shares of any of the funds in the Delaware Group,
including any fund that may be created, at the net asset value per share.
Family members of such persons at their direction, and any employee benefit
plan established by any of the foregoing funds, corporations, counsel or
broker/dealers may also purchase shares at net asset value. Purchases of Class
A Shares may also be made by clients of registered representatives of an
authorized investment dealer at net asset value within 12 months of a change of
the registered representative's employment, if the purchase is funded by
proceeds from an investment where a front-end sales charge, contingent deferred
sales charge or other sales charge has been assessed. Purchases of Class A
Shares may also be made at net asset value by bank employees who provide
services in connection with agreements between the bank and unaffiliated
brokers

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or dealers concerning sales of shares of Delaware Group funds. Officers,
directors and key employees of institutional clients of the Manager or any of
its affiliates may purchase Class A Shares at net asset value. Moreover,
purchases may be effected at net asset value for the benefit of the clients of
brokers, dealers and registered investment advisers affiliated with a broker or
dealer, if such broker, dealer or investment adviser has entered into an
agreement with the Distributor providing specifically for the purchase of Class
A Shares in connection with special investment products, such as wrap accounts
or similar fee based programs. Such purchasers are required to sign a letter
stating that the purchase is for investment only and that the securities may
not be resold except to the issuer. Such purchasers may also be required to
sign or deliver such other documents as Equity Funds V, Inc. may reasonably
require to establish eligibility for purchase at net asset value.

The Funds must be notified in advance that the trade qualifies for
purchase at net asset value.

LETTER OF INTENTION

The reduced front-end sales charges described above with respect to
Class A Shares are also applicable to the aggregate amount of purchases made by
any such purchaser previously enumerated within a 13-month period pursuant to a
written Letter of Intention provided by the Distributor and signed by the
purchaser, and not legally binding on the signer or Equity Funds V, Inc., which
provides for the holding in escrow by the Transfer Agent, of 5% of the total
amount of the Class A Shares intended to be purchased until such purchase is
completed within the 13-month period. A Letter of Intention may be dated to
include shares purchased up to 90 days prior to the date the Letter is signed.
The 13-month period begins on the date of the earliest purchase. If the
intended investment is not completed, except as noted below, the purchaser will
be asked to pay an amount equal to the difference between the front-end sales
charge on the Class A Shares purchased at the reduced rate and the front-end
sales charge otherwise applicable to the total shares purchased. If such
payment is not made within 20 days following the expiration of the 13-month
period, the Transfer Agent will surrender an appropriate number of the escrowed
shares for redemption in order to realize the difference. Such purchasers may
include the value (at offering price at the level designated in their Letter of
Intention) of all their shares of a Fund and of any class of any of the other
mutual funds in the Delaware Group (except shares of any Delaware Group fund
which do not carry a front-end sales charge, CDSC or Limited CDSC, other than
shares of Delaware Group Premium Fund, Inc. beneficially owned in connection
with the ownership of variable insurance products, unless they were acquired
through an exchange from a Delaware Group fund which carried a front-end sales
charge, CDSC or Limited CDSC) previously purchased and still held as of the
date of their Letter of Intention toward the completion of such Letter. For
purposes of satisfying an investor's obligation under a Letter of Intention,
Class B Shares and Class C Shares of a Fund and the corresponding classes of
shares of other Delaware Group funds which offer such shares may be aggregated
with Class A Shares of the Fund and the corresponding class of shares of the
other Delaware Group funds.

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Employers offering a Delaware Group retirement plan may also complete
a Letter of Intention to obtain a reduced front-end sales charge on investments
of Class A Shares made by the plan. The aggregate investment level of the
Letter of Intention will be determined and accepted by the Transfer Agent at
the point of plan establishment. The level and any reduction in front-end
sales charge will be based on actual plan participation and the projected
investments in Delaware Group funds that are offered with a front-end sales
charge, CDSC or Limited CDSC for a 13-month period. The Transfer Agent
reserves the right to adjust the signed Letter of Intention based on this
acceptance criteria. The 13- month period will begin on the date this Letter
of Intention is accepted by the Transfer Agent. If actual investments exceed
the anticipated level and equal an amount that would qualify the plan for
further discounts, any front-end sales charges will be automatically adjusted.
In the event this Letter of Intention is not fulfilled within the 13-month
period, the plan level will be adjusted (without completing another Letter of
Intention) and the employer will be billed for the difference in front-end
sales charges due, based on the plan's assets under management at that time.
Employers may also include the value (at offering price at the level designated
in their Letter of Intention) of all their shares intended for purchase that
are offered with a front-end sales charge, CDSC or Limited CDSC of any class.
Class B Shares and Class C Shares of a Fund and other Delaware Group funds
which offer corresponding classes of shares may also be aggregated for this
purpose.

COMBINED PURCHASES PRIVILEGE
In determining the availability of the reduced front-end sales charge
previously set forth with respect to Class A Shares, purchasers may combine the
total amount of any combination of Class B Shares and/or Class C Shares of the
Funds, as well as shares of any other class of any of the other Delaware Group
funds (except shares of any Delaware Group fund which do not carry a front-end
sales charge, CDSC or Limited CDSC, other than shares of Delaware Group Premium
Fund, Inc. beneficially owned in connection with the ownership of variable
insurance products, unless they were acquired through an exchange from a
Delaware Group fund which carried a front-end sales charge, CDSC or Limited
CDSC).

The privilege also extends to all purchases made at one time by an
individual; or an individual, his or her spouse and their children under 21; or
a trustee or other fiduciary of trust estates or fiduciary accounts for the
benefit of such family members (including certain employee benefit programs).

RIGHT OF ACCUMULATION

In determining the availability of the reduced front-end sales charge
with respect to Class A Shares, purchasers may also combine any subsequent
purchases of Class A Shares, Class B Shares and Class C Shares of a Fund as
well as shares of any other class of any of the other Delaware Group funds
which offer such classes (except shares of any Delaware Group fund which do not
carry a front-end sales charge, CDSC or Limited CDSC, other than shares of
Delaware Group Premium Fund, Inc. beneficially owned in connection with the
ownership of variable insurance products, unless they were acquired through an
exchange from a Delaware Group fund which carried a front-end sales charge,
CDSC or Limited CDSC). If, for example, any such purchaser has previously
purchased and still holds Class A Shares and/or shares of any other of the
classes described in the previous sentence with a value of $40,000 and
subsequently purchases $60,000 at offering price of additional shares of Class
A Shares, the charge applicable to the $60,000 purchase would currently be
3.75%. For the purpose of this calculation, the shares presently held shall be
valued at the public offering price that would have been in effect were the
shares purchased simultaneously with the current purchase. Investors should
refer to the table of sales charges for Class A Shares to determine the
applicability of the Right of Accumulation to their particular circumstances.

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12-MONTH REINVESTMENT PRIVILEGE
Holders of Class A Shares (and of the Institutional Classes holding
shares which were acquired through an exchange from one of the other mutual
funds in the Delaware Group offered with a front-end sales charge) who redeem
such shares of a Fund have one year from the date of redemption to reinvest all
or part of their redemption proceeds in Class A Shares of that Fund or in Class
A Shares of any of the other funds in the Delaware Group, subject to applicable
eligibility and minimum purchase requirements, in states where shares of such
other funds may be sold, at net asset value without the payment of a front-end
sales charge. This privilege does not extend to Class A Shares where the
redemption of the shares triggered the payment of a Limited CDSC. Persons
investing redemption proceeds from direct investments in mutual funds in the
Delaware Group offered without a front-end sales charge will be required to pay
the applicable sales charge when purchasing Class A Shares. The reinvestment
privilege does not extend to a redemption of either Class B or Class C Shares.

Any such reinvestment cannot exceed the redemption proceeds (plus any
amount necessary to purchase a full share). The reinvestment will be made at
the net asset value next determined after receipt of remittance. A redemption
and reinvestment could have income tax consequences. It is recommended that a
tax adviser be consulted with respect to such transactions. Any reinvestment
directed to a fund in which the investor does not then have an account will be
treated like all other initial purchases of a fund's shares. Consequently, an
investor should obtain and read carefully the prospectus for the fund in which
the investment is intended to be made before investing or sending money. The
prospectus contains more complete information about the fund, including charges
and expenses.

Investors should consult their financial advisers or the Transfer
Agent, which also serves as the Funds' shareholder servicing agent, about the
applicability of the Limited CDSC (see Contingent Deferred Sales Charge for
Certain Redemptions of Class A Shares Purchased at Net Asset Value under
Redemption and Exchange in the Fund Classes' Prospectuses) in connection with
the features described above.

GROUP INVESTMENT PLANS
Group Investment Plans which are not eligible to purchase shares of
the Institutional Classes may also benefit from the reduced front- end sales
charges for investments in Class A Shares set forth in the table on page 00,
based on total plan assets. If a company has more than one plan investing in
the Delaware Group of funds, then the total amount invested in all plans would
be used in determining the applicable front-end sales charge reduction upon
each purchase, both initial and subsequent, upon notification to the Fund in
which the investment is being made at the time of each such purchase.
Employees participating in such Group Investment Plans may also combine the
investments made in their plan account when determining the applicable
front-end sales charge on purchases to non-retirement Delaware Group investment
accounts if they so notify the Fund in connection with each purchase. For
other retirement plans and special services, see Retirement Plans for the Fund
Classes under Investment Plans.

THE INSTITUTIONAL CLASSES
The Institutional Class of each Fund is available for purchase only
by: (a) retirement plans introduced by persons not associated with brokers or
dealers that are primarily engaged in the retail securities business and
rollover individual retirement accounts from such plans; (b) tax-exempt
employee benefit plans of the Manager or its affiliates and securities dealer
firms with a selling agreement with the Distributor; (c) institutional advisory
accounts of the Manager or its affiliates and those having client relationships
with Delaware

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Investment Advisers, a division of the Manager, or its affiliates and their
corporate sponsors, as well as subsidiaries and related employee benefit plans
and rollover individual retirement accounts from such institutional advisory
accounts; (d) banks, trust companies and similar financial institutions
investing for their own account or for the accounts of their trust customers
for whom such financial institution is exercising investment discretion in
purchasing shares of the Class; and (e) registered investment advisers
investing on behalf of clients that consist solely of institutions and high
net-worth individuals having at least $1,000,000 entrusted to the adviser for
investment purposes, but only if the adviser is not affiliated or associated
with a broker or dealer and derives compensation for its services exclusively
from its clients for such advisory services.

Shares of the Institutional Classes are available for purchase at net
asset value, without the imposition of a front-end or contingent deferred sales
charge and are not subject to Rule 12b-1 expenses.

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INVESTMENT PLANS

REINVESTMENT PLAN/OPEN ACCOUNT

Unless otherwise designated by shareholders in writing, dividends from
net investment income and distributions from realized securities profits, if
any, will be automatically reinvested in additional shares of the respective
Fund Class of Value Fund in which an investor has an account (based on the net
asset value in effect on the reinvestment date) and will be credited to the
shareholder's account on that date. All dividends and distributions of each
Class of the Retirement Income Fund and of the Value Fund Institutional Class
are reinvested in the accounts of the holders of such shares (based on the net
asset value in effect on the reinvestment date). A confirmation of each
dividend payment from net investment income and of distributions from realized
securities profits, if any, will be mailed to shareholders in the first quarter
of the fiscal year.

Under the Reinvestment Plan/Open Account, shareholders may purchase
and add full and fractional shares to their plan accounts at any time either
through their investment dealers or by sending a check or money order to
specific Fund and Class in which shares are being purchased. Such purchases,
which must meet the minimum subsequent purchase requirements set forth in the
Prospectuses and this Part B, are made for Class A Shares at the public
offering price and, for Class B Shares, Class C Shares and the Institutional
Classes at the net asset value, at the end of the day of receipt. A
reinvestment plan may be terminated at any time. This plan does not assure a
profit nor protect against depreciation in a declining market.

REINVESTMENT OF DIVIDENDS IN OTHER DELAWARE GROUP FUNDS
Subject to applicable eligibility and minimum initial purchase
requirements and the limitations set forth below, holders of Class A, Class B
and Class C Shares may automatically reinvest dividends and/or distributions in
any of the mutual funds in the Delaware Group, including the Funds, in states
where their shares may be sold. Such investments will be at net asset value at
the close of business on the reinvestment date without any front-end sales
charge or service fee. The shareholder must notify the Transfer Agent in
writing and must have established an account in the fund into which the
dividends and/or distributions are to be invested. Any reinvestment directed
to a fund in which the investor does not then have an account will be treated
like all other initial purchases of a fund's shares. Consequently, an investor
should obtain and read carefully the prospectus for the fund in which the
investment is intended to be made before investing or sending money. The
prospectus contains more complete information about the fund, including charges
and expenses. See also Additional Methods of Adding to Your Investment -
Dividend Reinvestment Plan under How to Buy Shares in the Prospectuses for the
Fund Classes.

Subject to the following limitations, dividends and/or distributions
from other funds in the Delaware Group may be invested in shares of the Funds,
provided an account has been established. Dividends from Class A Shares may
not be directed to Class B Shares or Class C Shares. Dividends from Class B
Shares may only be directed to other Class B Shares and dividends from Class C
Shares may only be directed to other Class C Shares. See Appendix B--Classes
Offered in the Fund Classes' Prospectuses for the funds in the Delaware Group
that are eligible for investment by holders of Fund shares.

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INVESTING BY ELECTRONIC FUND TRANSFER
Direct Deposit Purchase Plan--Investors may arrange for a Fund to
accept for investment in Class A, Class B or Class C Shares, through an agent
bank, preauthorized government or private recurring payments. This method of
investment assures the timely credit to the shareholder's account of payments
such as social security, veterans' pension or compensation benefits, federal
salaries, Railroad Retirement benefits, private payroll checks, dividends, and
disability or pension fund benefits. It also eliminates lost, stolen and
delayed checks.

Automatic Investing Plan--Shareholders of Class A, Class B and Class C
Shares may make automatic investments by authorizing, in advance, monthly
payments directly from their checking account for deposit into their Fund
account. This type of investment will be handled in either of the following
ways. (1) If the shareholder's bank is a member of the National Automated
Clearing House Association ("NACHA"), the amount of the investment will be
electronically deducted from his or her account by Electronic Fund Transfer
("EFT"). The shareholder's checking account will reflect a debit each month at
a specified date although no check is required to initiate the transaction.
(2) If the shareholder's bank is not a member of NACHA, deductions will be made
by preauthorized checks, known as Depository Transfer Checks. Should the
shareholder's bank become a member of NACHA in the future, his or her
investments would be handled electronically through EFT.

* * *

Initial investments under the Direct Deposit Purchase Plan and the
Automatic Investing Plan must be for $250 or more and subsequent investments
under such Plans must be for $25 or more. An investor wishing to take
advantage of either service must complete an authorization form. Either
service can be discontinued by the shareholder at any time without penalty by
giving written notice.

Payments to a Fund from the federal government or its agencies on
behalf of a shareholder may be credited to the shareholder's account after such
payments should have been terminated by reason of death or otherwise. Any such
payments are subject to reclamation by the federal government or its agencies.
Similarly, under certain circumstances, investments from private sources may be
subject to reclamation by the transmitting bank. In the event of a
reclamation, a Fund may liquidate sufficient shares from a shareholder's
account to reimburse the government or the private source. In the event there
are insufficient shares in the shareholder's account, the shareholder is
expected to reimburse the Fund.

DIRECT DEPOSIT PURCHASES BY MAIL

Shareholders may authorize a third party, such as a bank or employer,
to make investments directly to their Fund accounts. A Fund will accept these
investments, such as bank-by-phone, annuity payments and payroll allotments, by
mail directly from the third party. Investors should contact their employers
or financial institutions who in turn should contact Equity Funds V, Inc. for
proper instructions.

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WEALTH BUILDER OPTION
Shareholders can use the Wealth Builder Option to invest in the Fund
Classes through regular liquidations of shares in their accounts in other
mutual funds in the Delaware Group. Shareholders of the Fund Classes may elect
to invest in one or more of the other mutual funds in the Delaware Group
through the Wealth Builder Option. See Wealth Builder Option and Redemption
and Exchange in the Prospectuses for the Fund Classes.

Under this automatic exchange program, shareholders can authorize
regular monthly investments (minimum of $100 per fund) to be liquidated from
their account and invested automatically into other mutual funds in the
Delaware Group, subject to the conditions and limitations set forth in the Fund
Classes' Prospectuses. The investment will be made on the 20th day of each
month (or, if the fund selected is not open that day, the next business day) at
the public offering price or net asset value, as applicable, of the fund
selected on the date of investment. No investment will be made for any month
if the value of the shareholder's account is less than the amount specified for
investment.

Periodic investment through the Wealth Builder Option does not insure
profits or protect against losses in a declining market. The price of the fund
into which investments are made could fluctuate. Since this program involves
continuous investment regardless of such fluctuating value, investors selecting
this option should consider their financial ability to continue to participate
in the program through periods of low fund share prices. This program involves
automatic exchanges between two or more fund accounts and is treated as a
purchase of shares of the fund into which investments are made through the
program. See Exchange Privilege for a brief summary of the tax consequences of
exchanges. Shareholders can terminate their participation at any time by
written notice to their Fund.

RETIREMENT PLANS FOR THE FUND CLASSES
An investment in either Fund may be suitable for tax-deferred
retirement plans. Among the retirement plans noted below, Class B Shares are
available for investment only by Individual Retirement Accounts, Simplified
Employee Pension Plans, 457 Deferred Compensation Plans and 403(b)(7) Deferred
Compensation Plans. The CDSC may be waived on certain redemptions of Class B
Shares and Class C Shares. See Waiver of Contingent Deferred Sales Charge -
Class B and Class C Shares under Redemption and Exchange in the Prospectuses
for the Fund Classes for a list of the instances in which the CDSC is waived.

Each purchase of Class B Shares is subject to a maximum purchase
limitation of $250,000 for retirement plans. Each purchase of Class C Shares
must be in an amount that is less than $1,000,000 for such plans. The maximum
purchase limitations apply only to the initial purchase of shares by the
retirement plan.

Minimum investment limitations generally applicable to other investors
do not apply to retirement plans other than Individual Retirement Accounts, for
which there is a minimum initial purchase of $250 and a minimum subsequent
purchase of $25 regardless of which Class is selected. Retirement plans may be
subject to plan establishment fees, annual maintenance fees and/or other
administrative or trustee fees. Fees are based

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upon the number of participants in the plan as well as the services selected.
Additional information about fees is included in retirement plan materials.
Fees are quoted upon request. Annual maintenance fees may be shared by
Delaware Management Trust Company, the Transfer Agent, other affiliates of the
Manager and others that provide services to such Plans.

Certain shareholder investment services available to non-retirement
plan shareholders may not be available to retirement plan shareholders.
Certain retirement plans may qualify to purchase shares of the Institutional
Class. See The Institutional Classes, above. For additional information on
any of the plans and Delaware's retirement services, call the Shareholder
Service Center telephone number.

IT IS ADVISABLE FOR AN INVESTOR CONSIDERING ANY ONE OF THE RETIREMENT
PLANS DESCRIBED BELOW TO CONSULT WITH AN ATTORNEY, ACCOUNTANT OR A QUALIFIED
RETIREMENT PLAN CONSULTANT. FOR FURTHER DETAILS, INCLUDING APPLICATIONS FOR
ANY OF THESE PLANS, CONTACT YOUR INVESTMENT DEALER OR THE DISTRIBUTOR.

Taxable distributions from the retirement plans described below may be
subject to withholding.

Please contact your investment dealer or the Distributor for the
special application forms required for the Plans described below.

PROTOTYPE PROFIT SHARING OR MONEY PURCHASE PENSION PLANS

Prototype Plans are available for self-employed individuals,
partnerships and corporations. These plans can be maintained as Section
401(k), profit sharing or money purchase pension plans. Contributions may be
invested only in Class A and Class C Shares.

INDIVIDUAL RETIREMENT ACCOUNT ("IRA")
A document is available for an individual who wants to establish an
IRA and make contributions which may be tax-deductible, even if the individual
is already participating in an employer-sponsored retirement plan. Even if
contributions are not deductible for tax purposes, as indicated below, earnings
will be tax-deferred. In addition, an individual may make contributions on
behalf of a spouse who has no compensation for the year or, for years prior to
1997, elects to be treated as having no compensation for the year. Investments
in each of the Fund Classes are permissible.

An individual can contribute up to $2,000 of his or her IRA each year.
Contributions may or may not be deductible depending upon the taxpayers
adjusted gross income and whether the taxpayer or his or her spouse is an
active participant in an employer-sponsored retirement plan. Even if a
taxpayer (or his or her spouse) is an active participant in an
employer-sponsored retirement plan, the full $2,000 deduction is still
available if the taxpayer's adjusted gross income is below $25,000 ($40,000 for
taxpayers filing joint returns). A partial deduction is allowed for married
couples with incomes between $40,000 and $50,000, and for single individuals
with incomes between $25,000 and $35,000. No deductions are available for
contributions to IRAs by taxpayers whose adjusted gross income before IRA
deductions exceeds $50,000 ($35,000 for singles) and who are active
participants in an employer-sponsored retirement plan. Taxpayers who are not
allowed deductions on IRA contributions still can make nondeductible IRA
contributions of as much as $2,000 for each working spouse ($2,250 for
one-income couples for years prior to 1997), and defer taxes on interest or
other earnings from the IRAs. Special rules apply for determining the
deductibility of contributions made by married individuals filing separate
returns.

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Effective for tax years beginning after 1996, one-income couples can
contribute up to $2,000 to each spouse's IRA provided the combined compensation
of both spouses is at least equal to the total contributions for both spouses.
If the working spouse is an active participant in an employer-sponsored
retirement plan and earns over $40,000, the maximum deduction limit is reduced
in the same way that the limit is reduced for contributions to a non-spousal
IRA.

A company or association may establish a Group IRA for employees or
members who want to purchase shares of a Fund. Purchases of $1 million or more
of Class A Shares qualify for purchase at net asset value but may, under
certain circumstances, be subject to a Limited CDSC. See Purchasing Shares for
information on reduced front-end sales charges applicable to Class A Shares.

Investments generally must be held in the IRA until age 59 1/2 in
order to avoid premature distribution penalties, but distributions generally
must commence no later than April 1 of the calendar year following the year in
which the participant reaches age 70 1/2. Individuals are entitled to revoke
the account, for any reason and without penalty, by mailing written notice of
revocation to Delaware Management Trust Company within seven days after the
receipt of the IRA Disclosure Statement or within seven days after the
establishment of the IRA, except, if the IRA is established more than seven
days after receipt of the IRA Disclosure Statement, the account may not be
revoked. Distributions from the account (except for the pro-rata portion of
any nondeductible contributions) are fully taxable as ordinary income in the
year received. Excess contributions removed after the tax filing deadline,
plus extensions, for the year in which the excess contributions were made are
subject to a 6% excise tax on the amount of excess. Premature distributions
(distributions made before age 59 1/2, except for death, disability and certain
other limited circumstances) will be subject to a 10% excise tax on the amount
prematurely distributed, in addition to the income tax resulting from the
distribution. See Alternative Purchase Arrangements - Class B Shares and
Class C Shares under Classes of Shares, Contingent Deferred Sales Charge -
Class B Shares and Class C Shares under Classes of Shares, and Waiver of
Contingent Deferred Sales Charge - Class B and Class C Shares under Redemption
and Exchange in the Fund Classes' Prospectuses concerning the applicability of
a CDSC upon redemption.

Effective January 1, 1997, the 10% premature distribution penalty will
not apply to distributions from an IRA that are used to pay medical expenses in
excess of 7.5% of adjusted gross income or to pay health insurance premiums by
an individual who has received unemployment compensation for 12 consecutive
weeks.

See Appendix A for additional IRA information.

SALARY REDUCTION SIMPLIFIED EMPLOYEE PENSION PLAN ("SAR/SEP")

Employers with 25 or fewer eligible employees can establish this plan
which permits employer contributions and salary deferral contributions in Class
A Shares and Class C Shares only. SAR/SEPs may not be established after
December 31, 1996. Employers may, however, continue to made contributions
under pre-1997 rules to SAR/SEPs established before January 1, 1997.

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PROTOTYPE 401(K) DEFINED CONTRIBUTION PLAN
Section 401(k) of the Code permits employers to establish qualified
plans based on salary deferral contributions. Plan documents are available to
enable employers to establish a plan. An employer may also elect to make
profit sharing contributions and/or matching contributions with investments in
only Class A Shares and Class C Shares or certain other funds in the Delaware
Group. Purchases under the plan may be combined for purposes of computing the
reduced front-end sales charge applicable to Class A Shares as set forth in the
table on page 00.

DEFERRED COMPENSATION PLAN FOR PUBLIC SCHOOLS AND NON-PROFIT ORGANIZATIONS
("403(B)(7)")
Section 403(b)(7) of the Code permits public school systems and
certain non-profit organizations to use mutual fund shares held in a custodial
account to fund deferred compensation arrangements for their employees. A
custodial account agreement is available for those employers who wish to
purchase any of the Fund Classes in conjunction with such an arrangement.
Applicable front-end sales charges with respect to Class A Shares for such
purchases are set forth in the table on page 00.

DEFERRED COMPENSATION PLAN FOR STATE AND LOCAL GOVERNMENT EMPLOYEES ("457")
Section 457 of the Code permits state and local governments, their
agencies and certain other entities to establish a deferred compensation plan
for their employees who wish to participate. This enables employees to defer a
portion of their salaries and any federal (and possibly state) taxes thereon.
Such plans may invest in shares of any of the Fund Classes. Although investors
may use their own plan, there is available a Delaware Group 457 Deferred
Compensation Plan. Interested investors should contact the Distributor or
their investment dealers to obtain further information. Applicable front-end
sales charges for such purchases of Class A Shares are set forth in the table
on page 00.

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DETERMINING OFFERING PRICE AND NET ASSET VALUE

Orders for purchases of Class A Shares are effected at the offering
price next calculated by the Fund in which shares are being purchased after
receipt of the order by the Fund or its agent. Orders for purchases of Class B
Shares, Class C Shares and the Institutional Classes are effected at the net
asset value per share next calculated after receipt of the order by the Fund in
which shares are being purchased or its agent. Selling dealers have the
responsibility of transmitting orders promptly.

The offering price for Class A Shares consists of the net asset value
per share plus any applicable sales charges. Offering price and net asset
value are computed as of the close of regular trading on the New York Stock
Exchange (ordinarily, 4 p.m., Eastern time) on days when the Exchange is open.
The New York Stock Exchange is scheduled to be open Monday through Friday
throughout the year except for New Year's Day, Presidents' Day, Good Friday,
Memorial Day, Independence Day, Labor Day, Thanksgiving and Christmas. When
the New York Stock Exchange is closed, the Funds will generally be closed,
pricing calculations will not be made and purchase and redemption orders will
not be processed.

An example showing how to calculate the net asset value per share and,
in the case of Class A Shares, the offering price per share, is included in
Value Fund's financial statements which are incorporated by reference into this
Part B.

Each Fund's net asset value per share is computed by adding the value
of all the securities and other assets in the portfolio, deducting any
liabilities and dividing by the number of shares outstanding. Expenses and
fees are accrued daily. In determining a Fund's total net assets, portfolio
securities primarily listed or traded on a national or foreign securities
exchange, except for bonds, are valued at the last sales price on that
exchange. Options are valued at the last reported sales price or, if no sales
are reported, at the mean between bid and asked prices. For valuation
purposes, foreign securities initially expressed in foreign currency values
will be converted into U.S. dollar values at the mean between the bid and
offered quotations of such currencies against U.S. dollars as last quoted by
any recognized dealer. Securities not traded on a particular day,
over-the-counter securities, and government and agency securities are valued at
the mean value between bid and asked prices. Money market instruments having a
maturity of less than 60 days are valued at amortized cost. Debt securities
(other than short-term obligations) are valued on the basis of valuations
provided by a pricing service when such prices are believed to reflect the fair
value of such securities. Use of a pricing service has been approved by the
Board of Directors. Prices provided by a pricing service take into account
appropriate factors such as institutional trading in similar groups of
securities, yield, quality, coupon rate, maturity, type of issue, trading
characteristics and other market data. Subject to the foregoing, securities
for which market quotations are not readily available and other assets are
valued at fair value as determined in good faith and in a method approved by
the Board of Directors.

Each Class of a Fund will bear, pro-rata, all of the common expenses
of that Fund. The net asset values of all outstanding shares of each Class of
a Fund will be computed on a pro-rata basis for each outstanding share based on
the proportionate participation in the Fund represented by the value of shares
of that Class. All income earned and expenses incurred by a Fund will be borne
on a pro-rata basis by each outstanding share of a Class, based on each Class'
percentage in the Fund represented by the value of shares of

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<PAGE> 164

such Classes, except that the Institutional Classes will not incur any of the
expenses under Value Fund Inc.'s 12b-1 Plans and the Class A, Class B and Class
C Shares alone will bear any 12b-1 Plan expenses payable under their respective
Plans. Due to the specific distribution expenses and other costs that will be
allocable to each Class, the net asset value of each Class of Value Fund will
vary. During the period the current waivers of 12b-1 Plan expenses by the
Distributor in connection with the distribution of Class A, Class B and Class C
Shares of the Retirement Income Fund remain applicable no such variance shall
arise.

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<PAGE> 165

REDEMPTION AND REPURCHASE

Any shareholder may require a Fund to redeem shares by sending a
WRITTEN REQUEST, signed by the record owner or owners exactly as the shares are
registered, to the Fund at 1818 Market Street, Philadelphia, PA 19103. In
addition, certain expedited redemption methods described below are available
when stock certificates have not been issued. Certificates are issued for
Class A Shares and Institutional Class shares only if a shareholder
specifically requests them. Certificates are not issued for Class B Shares or
Class C Shares. If stock certificates have been issued for shares being
redeemed, they must accompany the written request. For redemptions of $50,000
or less paid to the shareholder at the address of record, the request must be
signed by all owners of the shares or the investment dealer of record, but a
signature guarantee is not required. When the redemption is for more than
$50,000, or if payment is made to someone else or to another address,
signatures of all record owners are required and a signature guarantee may be
required. Each signature guarantee must be supplied by an eligible guarantor
institution. Each Fund reserves the right to reject a signature guarantee
supplied by an eligible institution based on its creditworthiness. The Funds
may request further documentation from corporations, retirement plans,
executors, administrators, trustees or guardians.

In addition to redemption of shares by a Fund, the Distributor, acting
as agent of the Funds, offers to repurchase Fund shares from broker/dealers
acting on behalf of shareholders. The redemption or repurchase price, which
may be more or less than the shareholder's cost, is the net asset value per
share next determined after receipt of the request in good order by the
respective Fund or its agent, less any applicable CDSC or Limited CDSC. This
is computed and effective at the time the offering price and net asset value
are determined. See Determining Offering Price and Net Asset Value. The Funds
and the Distributor end their business days at 5 p.m., Eastern time. This
offer is discretionary and may be completely withdrawn without further notice
by the Distributor.

Orders for the repurchase of Fund shares which are submitted to the
Distributor prior to the close of its business day will be executed at the net
asset value per share computed that day (subject to the applicable CDSC or
Limited CDSC), if the repurchase order was received by the broker/dealer from
the shareholder prior to the time the offering price and net asset value are
determined on such day. The selling dealer has the responsibility of
transmitting orders to the Distributor promptly. Such repurchase is then
settled as an ordinary transaction with the broker/dealer (who may make a
charge to the shareholder for this service) delivering the shares repurchased.

Certain redemptions of Class A Shares purchased at net asset value may
result in the imposition of a Limited CDSC. See Contingent Deferred Sales
Charge for Certain Redemptions of Class A Shares Purchased at Net Asset Value
under Redemption and Exchange in the Prospectuses for the Fund Classes. Class
B Shares are subject to a CDSC of: (i) 4% if shares are redeemed within two
years of purchase; (ii) 3% if shares are redeemed during the third or fourth
year following purchase; (iii) 2% if shares are redeemed during the fifth year
following purchase; and (iv) 1% if shares are redeemed during the sixth year
following purchase. Class C Shares are subject to a CDSC of 1% if shares are
redeemed within 12 months following purchase. See Contingent Deferred Sales
Charge - Class B Shares and Class C Shares under Classes of Shares in the
Prospectuses for the Fund Classes. Except for the applicable CDSC or Limited
CDSC, and with respect to the expedited payment by wire described below for
which there is currently a $7.50 bank wiring cost, neither the Funds nor the
Distributor charges a fee for redemptions or repurchases, but such fees could
be charged at any time in the future.

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<PAGE> 166

Payment for shares redeemed will ordinarily be mailed the next
business day, but in no case later than seven days, after receipt of a
redemption request in good order; provided, however, that each commitment to
mail or wire redemption proceeds by a certain time, as described below, is
modified by the qualifications described in the next paragraph.

Each Fund will process written or telephone redemption requests to the
extent that the purchase orders for the shares being redeemed have already
settled. A Fund will honor redemption requests as to shares for which a check
was tendered as payment, but a Fund will not mail or wire the proceeds until it
is reasonably satisfied that the check has cleared. This potential delay can
be avoided by making investments by wiring Federal Funds.

If a shareholder has been credited with a purchase by a check which is
subsequently returned unpaid for insufficient funds or for any other reason,
the Fund involved will automatically redeem from the shareholder's account the
shares purchased by the check plus any dividends earned thereon. Shareholders
may be responsible for any losses to a Fund or to the Distributor.

In case of a suspension of the determination of the net asset value
because the New York Stock Exchange is closed for other than weekends or
holidays, or trading thereon is restricted or an emergency exists as a result
of which disposal by a Fund of securities owned by it is not reasonably
practical, or it is not reasonably practical for a Fund fairly to value its
assets, or in the event that the Securities and Exchange Commission has
provided for such suspension for the protection of shareholders, a Fund may
postpone payment or suspend the right of redemption or repurchase. In such
case, the shareholder may withdraw the request for redemption or leave it
standing as a request for redemption at the net asset value next determined
after the suspension has been terminated.

Payment for shares redeemed or repurchased may be made in either cash
or kind, or partly in cash and partly in kind. Any portfolio securities paid
or distributed in kind would be valued as described in Determining Offering
Price and Net Asset Value. Subsequent sale by an investor receiving a
distribution in kind could result in the payment of brokerage commissions.
However, Equity Funds V, Inc. has elected to be governed by Rule 18f-1 under
the 1940 Act pursuant to which each Fund is obligated to redeem shares solely
in cash up to the lesser of $250,000 or 1% of the net asset value of each Fund
during any 90-day period for any one shareholder.

The value of a Fund's investments is subject to changing market
prices. Thus, a shareholder reselling shares to a Fund may sustain either a
gain or loss, depending upon the price paid and the price received for such
shares.

SMALL ACCOUNTS

Before a Fund involuntarily redeems shares from an account that, under
the circumstances noted in the relevant Prospectus, has remained below the
minimum amounts required by Equity Funds V, Inc.'s Prospectuses and sends the
proceeds to the shareholder, the shareholder will be notified in writing that
the value of the shares in the account is less than the minimum required and
will be allowed 60 days from the date of notice to make an additional
investment to meet the required minimum. See The Conditions of Your Purchase
under How to Buy Shares in the Prospectuses. Any redemption in an inactive
account established with a minimum investment may trigger mandatory redemption.
No CDSC or Limited CDSC will apply to the redemptions described in this
paragraph.

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<PAGE> 167

Effective November 29, 1995, the minimum initial investment in Value
Fund A Class was increased from $250 to $1,000. Accounts of Value Fund A Class
that were established prior to November 29, 1995 and maintain a balance in
excess of $250 will not presently be subject to the $9 quarterly service fee
that may be assessed against accounts with balances below the stated minimum
nor subject to involuntary redemption.

* * *

Each Fund has made available certain redemption privileges, as
described below. The Funds reserves the right to suspend or terminate these
expedited payment procedures upon 60 days' written notice to shareholders.

EXPEDITED TELEPHONE REDEMPTIONS
Shareholders of the Fund Classes or their investment dealers of record
wishing to redeem any amount of shares of $50,000 or less for which
certificates have not been issued may call the Shareholder Service Center at
800-523-1918 or, in the case of shareholders of the Institutional Classes,
their Client Services Representative at 800-828-5052 prior to the time the
offering price and net asset value are determined, as noted above, and have the
proceeds mailed to them at the record address. Checks payable to the
shareholder(s) of record will normally be mailed the next business day, but no
later than seven days, after the receipt of the redemption request. This
option is only available to individual, joint and individual fiduciary-type
accounts.

In addition, redemption proceeds of $1,000 or more can be transferred
to your predesignated bank account by wire or by check by calling the phone
numbers listed above. An authorization form must have been completed by the
shareholder and filed with the relevant Fund before the request is received.
Payment will be made by wire or check to the bank account designated on the
authorization form as follows:

1. PAYMENT BY WIRE: Request that Federal Funds be wired to the
bank account designated on the authorization form. Redemption proceeds will
normally be wired on the next business day following receipt of the redemption
request. There is a $7.50 wiring fee (subject to change) charged by CoreStates
Bank, N.A. which will be deducted from the withdrawal proceeds each time the
shareholder requests a redemption. If the proceeds are wired to the
shareholder's account at a bank which is not a member of the Federal Reserve
System, there could be a delay in the crediting of the funds to the
shareholder's bank account.

2. PAYMENT BY CHECK: Request a check be mailed to the bank
account designated on the authorization form. Redemption proceeds will
normally be mailed the next business day, but no later than seven days, from
the date of the telephone request. This procedure will take longer than the
Payment by Wire option (1 above) because of the extra time necessary for the
mailing and clearing of the check after the bank receives it.

REDEMPTION REQUIREMENTS: In order to change the name of the bank and
the account number it will be necessary to send a written request to the
relevant Fund and a signature guarantee may be required. Each signature
guarantee must be supplied by an eligible guarantor institution. The Funds
reserves the right to reject a signature guarantee supplied by an eligible
institution based on its creditworthiness.

To reduce the shareholder's risk of attempted fraudulent use of the
telephone redemption procedure, payment will be made only to the bank account
designated on the authorization form.

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<PAGE> 168

If expedited payment under these procedures could adversely affect a
Fund, the Fund may take up to seven days to pay the shareholder.

Neither the Funds nor the Funds' Transfer Agent is responsible for any
shareholder loss incurred in acting upon written or telephone instructions for
redemption or exchange of Fund shares which are reasonably believed to be
genuine. With respect to such telephone transactions, each Fund will follow
reasonable procedures to confirm that instructions communicated by telephone
are genuine (including verification of a form of personal identification) as,
if it does not, such Fund or the Transfer Agent may be liable for any losses
due to unauthorized or fraudulent transactions. Telephone instructions
received by shareholders of the Fund Classes are generally tape recorded. A
written confirmation will be provided for all purchase, exchange and redemption
transactions initiated by telephone.

SYSTEMATIC WITHDRAWAL PLANS

Shareholders of Class A, Class B and Class C Shares of Value Fund who
own or purchase $5,000 or more of shares at the offering price, or net asset
value, as applicable, for which certificates have not been issued may establish
a Systematic Withdrawal Plan for monthly withdrawals of $25 or more, or
quarterly withdrawals of $75 or more, although Value Fund does not recommend
any specific amount of withdrawal. This $5,000 minimum does not apply for
Value Fund's prototype retirement plans. Shares purchased with the initial
investment and through reinvestment of cash dividends and realized securities
profits distributions will be credited to the shareholder's account and
sufficient full and fractional shares will be redeemed at the net asset value
calculated on the third business day preceding the mailing date.

Checks are dated either the 1st or the 15th of the month, as selected
by the shareholder (unless such date falls on a holiday or a weekend) and are
normally mailed within two business days. Both ordinary income dividends and
realized securities profits distributions will be automatically reinvested in
additional shares of the Class at net asset value. This plan is not
recommended for all investors and should be started only after careful
consideration of its operation and effect upon the investor's savings and
investment program. To the extent that withdrawal payments from the plan
exceed any dividends and/or realized securities profits distributions paid on
shares held under the plan, the withdrawal payments will represent a return of
capital, and the share balance may in time be depleted, particularly in a
declining market.

The sale of shares for withdrawal payments constitutes a taxable event
and a shareholder may incur a capital gain or loss for federal income tax
purposes. This gain or loss may be long-term or short-term depending on the
holding period for the specific shares liquidated. Premature withdrawals from
retirement plans may have adverse tax consequences.

Withdrawals under this plan made concurrently with the purchases of
additional shares may be disadvantageous to the shareholder. Purchases of
Class A Shares of Value Fund through a periodic investment program in a fund
managed by the Manager must be terminated before a Systematic Withdrawal Plan
with respect to such shares can take effect, except if the shareholder is a
participant in one of our retirement plans or is investing in Delaware Group
funds which do not carry a sales charge. Redemptions of Class A Shares
pursuant to a Systematic Withdrawal Plan may be subject to a Limited CDSC if
the purchase was made at net asset value and a dealer's commission has been
paid on that purchase. Redemptions of Class B Shares or Class C Shares
pursuant to a Systematic Withdrawal Plan may be subject to a CDSC, unless the
annual amount

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<PAGE> 169

selected to be withdrawn is less than 12% of the account balance on the date
that the Systematic Withdrawal Plan was established. See Waiver of Contingent
Deferred Sales Charge - Class B and Class C Shares and Waiver of Limited
Contingent Deferred Sales Charge - Class A Shares under Redemption and Exchange
in the Prospectus for the Fund Classes of Value Fund. Shareholders should
consult their financial advisers to determine whether a Systematic Withdrawal
Plan would be suitable for them.

An investor wishing to start a Systematic Withdrawal Plan must
complete an authorization form. If the recipient of Systematic Withdrawal Plan
payments is other than the registered shareholder, the shareholder's signature
on this authorization must be guaranteed. Each signature guarantee must be
supplied by an eligible guarantor institution. Value Fund reserves the right
to reject a signature guarantee supplied by an eligible institution based on
its creditworthiness. This plan may be terminated by the shareholder or the
Transfer Agent at any time by giving written notice.

The Systematic Withdrawal Plan is not available for the Institutional
Classes or, currently, any of the Fund Classes of Retirement Income Fund.

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<PAGE> 170

DISTRIBUTIONS AND TAXES

Value Fund has qualified, and intends to continue to qualify, and
Retirement Income Fund intends to qualify as a regulated investment company
under Subchapter M of the Code. As such, a Fund will not be subject to federal
income tax on net investment income and net realized capital gains which are
distributed to shareholders.

Each Class of shares of a Fund will share proportionately in the
investment income and expenses of that Fund, except that, absent any applicable
fee waiver, Class A Shares, Class B Shares and Class C Shares alone will incur
distribution fees under their respective 12b-1 Plans.

Value Fund intends to pay out substantially all of its net investment
income and net realized capital gains. Such payments, if any, will be made
once a year during the first quarter of the following fiscal year. Retirement
Income Fund expects to declare and pay dividends from net investment income
monthly to shareholders of each Class of the Fund's shares. However,
Retirement Income Fund does not anticipate declaring or paying dividends during
the first few months following the commencement of its operations. All
dividends and any capital gains distributions will be automatically credited to
the shareholder's account in additional shares of the same class of the Fund at
net asset value unless, in the case of shareholders in the Fund Classes of
Value Fund, the shareholder requests in writing that such dividends and/or
distributions be paid in cash. Dividend payments of $1.00 or less will be
automatically reinvested, notwithstanding a shareholder's election to receive
dividends in cash. If such a shareholder's dividends increase to greater than
$1.00, the shareholder would have to file a new election in order to begin
receiving dividends in cash again.

Any check in payment of dividends or other distributions which cannot
be delivered by the United States Post Office or which remains uncashed for a
period of more than one year may be reinvested in the shareholder's account at
the then-current net asset value and the dividend option may be changed from
cash to reinvest. Value Fund may deduct from a shareholder's account the costs
of the Fund's effort to locate a shareholder if a shareholder's mail is
returned by the United States Post Office or the Fund is otherwise unable to
locate the shareholder or verify the shareholder's mailing address. These
costs may include a percentage of the account when a search company charges a
percentage fee in exchange for their location services.

Dividends from investment income and short-term capital gains
distributions are treated by shareholders as ordinary income for federal income
tax purposes. Distributions of long-term capital gains, if any, are taxable to
shareholders as long-term capital gains, regardless of the length of time an
investor has held such shares, and these gains are currently taxed at long-term
capital gain rates. The tax status of dividends and distributions paid to
shareholders will not be affected by whether they are paid in cash or in
additional shares. Persons not subject to tax will not be required to pay
taxes on distributions.

A portion of each Fund's dividends may qualify for the
dividends-received deduction for corporations provided in the federal income
tax law. The portion of dividends paid by each Fund that so qualifies will be
designated each year in a notice to that Fund's shareholders, and cannot exceed
the gross amount of dividends received by the Fund from domestic (U.S.)
corporations that would have qualified for the dividends-received deduction in
the hands of the Fund if the Fund was a regular corporation. The availability
of the dividends-received deduction is subject to certain holding period and
debt financing restrictions imposed under the Code on the corporation claiming
the deduction. For the fiscal year ended November 30, 1995, 42.37% of Value
Fund's dividends from net investment income was eligible for this deduction.

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<PAGE> 171

Shareholders will be notified annually by Equity Funds V, Inc. as to
the federal income tax status of dividends and distributions.

Distributions may also be subject to state and local taxes;
shareholders are advised to consult with their tax advisers in this regard.
Shares of each Fund will be exempt from Pennsylvania county personal property
taxes.

See also Other Tax Requirements under Accounting and Tax Issues in
this Part B.

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INVESTMENT MANAGEMENT AGREEMENT

The Manager, located at One Commerce Square, Philadelphia, PA 19103,
furnishes investment management services to each Fund, subject to the
supervision and direction of Equity Funds V, Inc.'s Board of Directors.

The Investment Management Agreement for Value Fund is dated April 3,
1995, and was approved by shareholders on March 29, 1995. The Investment
Management Agreement for Retirement Income Fund is dated November 29, 1996, and
was approved by the initial shareholder on November 29, 1996. Each Agreement
has an initial term of two years and may be renewed each year only so long as
such renewal and continuance are specifically approved at least annually by the
Board of Directors or by vote of a majority of the outstanding voting
securities of a Fund, and only if the terms and the renewal thereof have been
approved by vote of a majority of the directors of Equity Funds V, Inc. who are
not parties thereto or interested persons of any such party, cast in person at
a meeting called for the purpose of voting on such approval. Each Agreement is
terminable without penalty on 60 days' notice by the directors of Equity Funds
V, Inc. or by the Manager. Each Agreement will terminate automatically in the
event of its assignment.

The compensation paid by Value Fund for investment management services
is equal to 1/16 of 1% per month (the equivalent of 3/4 of 1% per year) of the
Fund's average daily net assets, less all directors' fees paid to the
unaffiliated directors by the Fund. This fee is higher than that paid by many
other funds; it may be higher or lower than that paid by funds with comparable
investment objectives. On November 30, 1995, the total net assets of Value
Fund were $190,097,575. Under the general supervision of the Board of
Directors, the Manager makes all investment decisions which are implemented by
the Fund. The Manager pays the salaries of all directors, officers and
employees who are affiliated with both the Manager and Equity Funds V, Inc.
Investment management fees paid by Value Fund for the fiscal years ended
November 30, 1993, 1994 and 1995 amounted to $724,137, $1,341,214, and
$1,371,155, respectively.

The annual compensation paid by the Retirement Income Fund for
investment management services is equal to 0.65% on the first $500 million of
the Fund's average daily net assets, 0.625% of the next $500 million and 0.60%
of the average daily net assets in excess of $1 billion. The Manager pays the
salaries of all directors, officers and employees who are affiliated with both
the Manager and Equity Funds V, Inc.

The Manager has elected voluntarily to waive that portion, if any, of
the annual management fees payable by the Retirement Income Fund and to pay
certain expenses of the Fund to the extent necessary to ensure that the total
operating expenses of each Class do not exceed 0.75% (exclusive of taxes,
interest, brokerage commissions, extraordinary expenses and 12b-1 expenses)
during the commencement of the public offering of the Fund through May 31,
1997.

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<PAGE> 173

Except for those expenses borne by the Manager under the Investment
Management Agreements and the Distributor under the Distribution Agreements,
each Fund is responsible for all of its own expenses. Among others, these
include the Fund's proportionate share of rent and certain other administrative
expenses; the investment management fees; transfer and dividend disbursing
agent fees and costs; custodian expenses; federal and state securities
registration fees; proxy costs; and the costs of preparing prospectuses and
reports sent to shareholders. The ratios of expenses to average daily net
assets of Value Fund A Class and Value Fund B Class for the fiscal year ended
November 30, 1995 were 1.48% and 2.18%, respectively, which reflects the impact
of their 12b-1 Plans. The ratio of expenses to average daily net assets for
the Value Fund Institutional Class for the fiscal year ended November 30, 1995
was 1.18%. Value Fund anticipates that the ratio of expenses to average daily
net assets of the Class C Shares will be approximately equal to that of the
Class B Shares.

By California regulation, the Manager is required to waive certain
fees and reimburse the Fund for certain expenses to the extent that the Fund's
annual operating expenses, exclusive of taxes, interest, brokerage commissions
and extraordinary expenses, exceed 2 1/2% of its first $30 million of average
daily net assets, 2% of the next $70 million of average daily net assets and 1
1/2% of any additional average daily net assets. For the fiscal year ended
November 30, 1995, no such reimbursement was necessary or paid for Value Fund.

DISTRIBUTION AND SERVICE

The Distributor, Delaware Distributors, L.P. (which formerly conducted
business as Delaware Distributors, Inc.), located at 1818 Market Street,
Philadelphia, PA 19103, serves as the national distributor of each Fund's
shares under a Distribution Agreement dated April 3, 1995, as amended on
November 29, 1995 for Value Fund and under a Distribution Agreement dated
November 29, 1996 for Retirement Income Fund. The Distributor is an affiliate
of the Manager and bears all of the costs of promotion and distribution, except
for payments by each Fund on behalf of Class A Shares, Class B Shares and Class
C Shares under their respective 12b-1 Plans. Prior to January 3, 1995,
Delaware Distributors, Inc. ("DDI") served as the national distributor of
Value Fund's shares. On that date, Delaware Distributors, L.P., a newly formed
limited partnership, succeeded to the business of DDI. All officers and
employees of DDI became officers and employees of Delaware Distributors, L.P.
DDI is the corporate general partner of Delaware Distributors, L.P. and both
DDI and Delaware Distributors, L.P. are indirect, wholly owned subsidiaries of
Delaware Management Holdings, Inc. The Distributor has elected voluntarily to
waive payments under the 12b-1 Plan for the Class A Shares, Class B Shares and
the Class C Shares of the Retirement Income Fund during the commencement of the
public offering of the Fund through May 31, 1997.

The Transfer Agent, Delaware Service Company, Inc., another affiliate
of the Manager located at 1818 Market Street, Philadelphia, PA 19103, serves as
the Funds' shareholder servicing, dividend disbursing and transfer agent
pursuant to an agreement dated November 29, 1996. The Transfer Agent also
provides accounting services to the Funds pursuant to the terms of a separate
Fund Accounting Agreement. The Transfer Agent is also an indirect, wholly
owned subsidiary of Delaware Management Holdings, Inc.

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<PAGE> 174
OFFICERS AND DIRECTORS

The business and affairs of Equity Funds V, Inc. are managed under the
direction of its Board of Directors.

Certain officers and directors of Equity Funds V, Inc. hold identical
positions in each of the other funds in the Delaware Group. On October 31,
1996, Value Fund Inc.'s officers and directors owned less than 1% of the
outstanding shares of the Class A Shares, Class B Shares and Class C Shares,
respectively, and approximately 1.67% of the outstanding shares of the
Institutional Class of Value Fund.

As of October 31, 1996, management believes the following accounts
held 5% or more of the outstanding shares of the Class A Shares, Class B Shares
and Class C Shares and approximately 1.69% of the outstanding shares of the
Institutional Class of Value Fund:

<TABLE>
<CAPTION>
Class Name and Address of Account Share Amount Percentage
- ----- --------------------------- ------------ ----------
<S> <C> <C> <C>
Value A Class MLPF&S For the Sole Benefit of its Customers
Attention: Fund Administration
4800 Deer Lake Drive East - 3rd Floor
Jacksonville, FL 32246 659,824 8.80%

Value B Class MLPF&S For the Sole Benefit of its Customers
Attention: Fund Administration
4800 Deer Lake Drive East - 3rd Floor
Jacksonville, FL 32246 57,240 11.68%

Value C Class MLPF&S For the Sole Benefit of its Customers
Attention: Fund Administration
4800 Deer Lake Drive East - 3rd Floor
Jacksonville, FL 32246 61,989 49.23%

401(k) Plan of Tower City Title Agency
6151 Wilson Mills Road
Highland Heights, OH 44143 8,400 6.67%

Value Institutional Class Bank of New York
Cust. Equity League Pension TR FD
Amivest Corp. Discretionary Investment Manager
52 Williams Street - 5th Floor
New York, NY 10005 146,030 23.08%

Amalgamated Bank of New York
Cust. TWU-NYC PVT Bus Lines Pension Fund
Amivest Corp. Discretionary Investment Manager
P.O. Box 370 Cooper Station
New York, NY 10276 102,987 16.28%
</TABLE>

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<PAGE> 175

<TABLE>
<CAPTION>
Class Name and Address of Account Share Amount Percentage
- ----- --------------------------- ------------ ----------
<S> <C> <C> <C>
Value Institutional Class Bank of New York
Cust. American Fed of Musicians and
Employees Pension Fund
Amivest Corp. Discretionary Investment Manager
48 Wall Street - 9th Floor
Attention: C. DiGiose
New York, NY 10005 95,006 15.01%

RS DMC Employee Profit Sharing Plan
Delaware Management Company
Employee Profit Sharing Trust
c/o Rick Seidel
1818 Market Street
Philadelphia, PA 19103 65,902 10.41%
</TABLE>

DMH Corp., Delaware Management Company, Inc., Delaware Distributors,
L.P., Delaware Distributors, Inc., Delaware Service Company, Inc., Delaware
Management Trust Company, Delaware International Holdings Ltd., Founders
Holdings, Inc., Delaware International Advisers Ltd., Delaware Capital
Management, Inc. and Delaware Investment & Retirement Services, Inc. are direct
or indirect, wholly owned subsidiaries of Delaware Management Holdings, Inc.
("DMH"). On April 3, 1995, a merger between DMH and a wholly owned subsidiary
of Lincoln National Corporation ("Lincoln National") was completed. In
connection with the merger, a new Investment Management Agreement between
Equity Funds V, Inc. and the Manager on behalf of Value Fund was executed
following shareholder approval. DMH and the Manager are now indirect, wholly
owned subsidiaries, and subject to the ultimate control, of Lincoln National.
Lincoln National, with headquarters in Fort Wayne, Indiana, is a diversified
organization with operations in many aspects of the financial services
industry, including insurance and investment management.

Directors and principal officers of Equity Funds V, Inc. are noted
below along with their ages and their business experience for the past five
years. Unless otherwise noted, the address of each officer and director is One
Commerce Square, Philadelphia, PA 19103.

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<PAGE> 176

*WAYNE A. STORK (59)
Chairman, President, Chief Executive Officer, Director and/or Trustee
of Equity Funds V, Inc., 16 other investment companies in the
Delaware Group (which excludes Delaware Pooled Trust, Inc.),
Delaware Management Holdings, Inc., DMH Corp., Delaware
International Holdings Ltd. and Founders Holdings, Inc.
Chairman and Director of Delaware Pooled Trust, Inc., Delaware
Distributors, Inc., Delaware Capital Management, Inc. and
Delaware Investment & Retirement Services, Inc.
Chairman, President, Chief Executive Officer, Chief Investment Officer
and Director of Delaware Management Company, Inc.
Chairman, Chief Executive Officer and Director of Delaware
International Advisers Ltd.
Director of Delaware Service Company, Inc.
During the past five years, Mr. Stork has served in various
executive capacities at different times within the Delaware
organization.

WINTHROP S. JESSUP (51)
Executive Vice President of Equity Funds V, Inc., 16 other investment
companies in the Delaware Group (which excludes Delaware
Pooled Trust, Inc.) and Delaware Management Holdings, Inc.
President and Chief Executive Officer of Delaware Pooled Trust, Inc.
President and Director of Delaware Capital Management, Inc.
Executive Vice President and Director of DMH Corp., Delaware
Management Company, Inc.,
Delaware International Holdings Ltd. and Founders Holdings,
Inc.
Vice Chairman and Director of Delaware Distributors, Inc.
Vice Chairman of Delaware Distributors, L.P.
Director of Delaware Service Company, Inc., Delaware International
Advisers Ltd., Delaware Management Trust Company and Delaware
Investment & Retirement Services, Inc.
During the past five years, Mr. Jessup has served in various executive
capacities at different times within the Delaware organization.

RICHARD G. UNRUH, JR. (57)
Executive Vice President of Equity Funds V, Inc. and each of the other
17 investment companies in the Delaware Group.
Executive Vice President and Director of Delaware Management Company,
Inc.
Senior Vice President of Delaware Management Holdings, Inc. and
Delaware Capital Management, Inc.
Director of Delaware International Advisers Ltd.
During the past five years, Mr. Unruh has served in various executive
capacities at different times within the Delaware
organization.

_____________________________
*Director affiliated with Equity Funds V, Inc.s' investment manager and
considered an "interested person" as defined in the 1940 Act.

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PAUL E. SUCKOW (49)
Executive Vice President/Chief Investment Officer, Fixed Income of
Equity Funds V, Inc., each of the other 17 investment
companies in the Delaware Group and Delaware Management
Company, Inc.
Executive Vice President/Chief Investment Officer, Fixed Income and
Director of Founders Holdings, Inc.
Senior Vice President/Chief Investment Officer, Fixed Income of
Delaware Management Holdings, Inc.
Senior Vice President of Delaware Capital Management, Inc.
Director of Founders CBO Corporation.
Director of HYPPCO Finance Company Ltd.
Before returning to the Delaware Group in 1993, Mr. Suckow was
Executive Vice President and Director of Fixed Income for
Oppenheimer Management Corporation, New York, NY from 1985 to
1992. Prior to that, Mr. Suckow was a fixed-income portfolio
manager for the Delaware Group.

WALTER P. BABICH (69)
Director and/or Trustee of Equity Funds V, Inc. and each of the other
17 investment companies in the Delaware Group.
460 North Gulph Road, King of Prussia, PA 19406.
Board Chairman, Citadel Constructors, Inc.
From 1986 to 1988, Mr. Babich was a partner of Irwin & Leighton and
from 1988 to 1991, he was a partner of I&L Investors.

ANTHONY D. KNERR (57)
Director and/or Trustee of Equity Funds V, Inc. and each of the other
17 investment companies in the Delaware Group.
500 Fifth Avenue, New York, NY 10110.
Founder and Managing Director, Anthony Knerr & Associates.
From 1982 to 1988, Mr. Knerr was Executive Vice President/Finance and
Treasurer of Columbia University, New York. From 1987 to
1989, he was also a lecturer in English at the University. In
addition, Mr. Knerr was Chairman of The Publishing Group,
Inc., New York, from 1988 to 1990. Mr. Knerr founded The
Publishing Group, Inc. in 1988.

ANN R. LEVEN (56)
Director and/or Trustee of Equity Funds V, Inc. and each of the other
17 investment companies in the Delaware Group.
785 Park Avenue, New York, NY 10021.
Treasurer, National Gallery of Art.
From 1984 to 1990, Ms. Leven was Treasurer and Chief Fiscal Officer of
the Smithsonian Institution, Washington, DC, and from 1975 to
1992, she was Adjunct Professor of Columbia Business School.

W. THACHER LONGSTRETH (76)
Director and/or Trustee of Equity Funds V, Inc. and each of the other
17 investment companies in the Delaware Group.
City Hall, Philadelphia, PA 19107.
Philadelphia City Councilman.

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CHARLES E. PECK (70)
Director and/or Trustee of Equity Funds V, Inc. and each of the other
17 investment companies in the Delaware Group.
P.O. Box 1102, Columbia, MD 21044.
Secretary/Treasurer, Enterprise Homes, Inc.
From 1981 to 1990, Mr. Peck was Chairman and Chief Executive Officer
of The Ryland Group, Inc., Columbia, MD.

DAVID K. DOWNES (56)
Senior Vice President/Chief Administrative Officer/Chief Financial
Officer of Equity Funds V, Inc., each of the other 17
investment companies in the Delaware Group and Delaware
Management Company, Inc.
Chairman and Director of Delaware Management Trust Company.
Chief Executive Officer and Director of Delaware Investment &
Retirement Services, Inc.
Executive Vice President/Chief Administrative Officer/Chief Financial
Officer/Treasurer of Delaware Management Holdings, Inc.
Senior Vice President/Chief Financial Officer/Treasurer and Director
of DMH Corp.
Senior Vice President/Chief Administrative Officer and Director of
Delaware Distributors, Inc.
Senior Vice President/Chief Administrative Officer of Delaware
Distributors, L.P.
Senior Vice President/Chief Administrative Officer/Chief Financial
Officer and Director of Delaware Service Company, Inc.
Chief Financial Officer and Director of Delaware International
Holdings Ltd.
Senior Vice President/Chief Financial Officer/Treasurer of Delaware
Capital Management, Inc.
Senior Vice President/Chief Financial Officer and Director of Founders
Holdings, Inc.
Director of Delaware International Advisers Ltd.
Before joining the Delaware Group in 1992, Mr. Downes was Chief
Administrative Officer, Chief Financial Officer and Treasurer
of Equitable Capital Management Corporation, New York, from
December 1985 through August 1992, Executive Vice President
from December 1985 through March 1992 and Vice Chairman from
March 1992 through August 1992.

GEORGE M. CHAMBERLAIN, JR. (49)
Senior Vice President and Secretary of Equity Funds V, Inc., each of
the other 17 investment companies in the Delaware Group,
Delaware Management Holdings, Inc. and Delaware Distributors,
L.P.
Executive Vice President, Secretary and Director of Delaware
Management Trust Company.
Senior Vice President, Secretary and Director of DMH Corp., Delaware
Management Company, Inc., Delaware Distributors, Inc.,
Delaware Service Company, Inc.,
Founders Holdings, Inc., Delaware Investment & Retirement
Services, Inc. and Delaware Capital Management, Inc.
Secretary and Director of Delaware International Holdings Ltd.
Director of Delaware International Advisers Ltd.
Attorney.
During the past five years, Mr. Chamberlain has served in various
capacities at different times within the Delaware
organization.

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<PAGE> 179

DAVID C. DALRYMPLE (38)
Vice President/Senior Portfolio Manager of Equity Funds V, Inc. and
seven other investment companies in the Delaware Group.
Before joining the Delaware Group in 1991, Mr. Dalrymple was an
Assistant Portfolio Manager for Lord Abbett and Company, New
York, N.Y. from 1986 to 1991.

GERALD T. NICHOLS (38)
Vice President/Senior Portfolio Manager of Equity Funds V, Inc., of 12
other investment companies in the Delaware Group and of
Delaware Management Company, Inc.
Vice President of Founders Holdings, Inc.
Assistant Secretary, Treasurer and Director of Founders CBO
Corporation.
During the past five years, Mr. Nichols has served in various
capacities at different times within the Delaware
organization.

BABAK ZENOUZI (33)
Vice President/Portfolio Manager of Equity Funds V, Inc. and 10 other
investment companies in the Delaware Group.
Vice President/Assistant Portfolio Manager of Delaware Investment
Advisers.
Before joining the Delaware Group in 1992, he was with The Boston
Company where he held the positions of assistant vice
president, senior financial analyst, financial analyst and
portfolio accountant.

JOSEPH H. HASTINGS (46)
Vice President/Corporate Controller of Equity Funds V, Inc., each of
the other 17 investment companies in the Delaware Group,
Delaware Management Holdings, Inc., DMH Corp., Delaware
Management Company, Inc., Delaware Distributors, L.P.,
Delaware Distributors, Inc., Delaware Service Company, Inc.,
Delaware Capital Management, Inc., Founders Holdings, Inc. and
Delaware International Holdings Ltd.
Chief Financial Officer/Treasurer of Delaware Investment & Retirement
Services, Inc.
Executive Vice President/Chief Financial Officer/Treasurer of Delaware
Management Trust Company.
Assistant Treasurer of Founders CBO Corporation.
1818 Market Street, Philadelphia, PA 19103.
Before joining the Delaware Group in 1992, Mr. Hastings was Chief
Financial Officer for Prudential Residential Services, L.P.,
New York, NY from 1989 to 1992. Prior to that, Mr. Hastings
served as Controller and Treasurer for Fine Homes
International, L.P., Stamford, CT from 1987 to 1989.

MICHAEL P. BISHOF (34)
Vice President/Treasurer of Equity Funds V, Inc., each of the other 17
investment companies in the
Delaware Group, Delaware Management Company, Inc., Delaware
Distributors, Inc., Delaware Distributors, L.P., Delaware
Service Company, Inc. and Founders Holdings, Inc.
Vice President/Manager of Investment Accounting of Delaware
International Holdings Ltd.
Assistant Treasurer of Founders CBO Corporation.
Before joining the Delaware Group in 1995, Mr. Bishof was a Vice
President for Bankers Trust, New York, NY from 1994 to 1995, a
Vice President for CS First Boston Investment Management, New
York, NY from 1993 to 1994 and an Assistant Vice President for
Equitable Capital Management Corporation, New York, NY from
1987 to 1993.

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<PAGE> 180

The following is a compensation table listing for each director
entitled to receive compensation, the aggregate compensation received from
Equity Funds V, Inc. and the total compensation received from all Delaware
Group funds for the fiscal year ended November 30, 1995 and an estimate of
annual benefits to be received upon retirement under the Delaware Group
Retirement Plan for Directors/Trustees as of April 30, 1996.

<TABLE>
<CAPTION>
PENSION OR
RETIREMENT
BENEFITS
ACCRUED ESTIMATED TOTAL
AGGREGATE AS PART OF ANNUAL COMPENSATION
COMPENSATION EQUITY BENEFITS FROM ALL 17
FROM EQUITY FUNDS V, INC. UPON DELAWARE
NAME FUNDS V, INC. EXPENSES RETIREMENT* GROUP FUNDS
<S> <C> <C> <C> <C>
W. Thacher Longstreth $2,178 None $30,000 $58,188
Ann R. Leven $2,474 None $30,000 $66,324
Walter P. Babich $2,502 None $30,000 $67,324
Anthony D. Knerr $2,238 None $30,000 $62,613
Charles E. Peck $2,178 None $30,000 $58,188
</TABLE>

* Under the terms of the Delaware Group Retirement Plan for
Directors/Trustees, each disinterested director who, at the time of
his or her retirement from the Board, has attained the age of 70 and
served on the Board for at least five continuous years, is entitled to
receive payments from each fund in the Delaware Group for a period
equal to the lesser of the number of years that such person served as
a director or the remainder of such person's life. The amount of such
payments will be equal, on an annual basis, to the amount of the
annual retainer that is paid to directors of each fund at the time of
such person's retirement. If an eligible director retired as of April
30, 1996, he or she would be entitled to annual payments totaling
$30,000, in the aggregate, from all of the funds in the Delaware
Group, based on the number of funds in the Delaware Group as of that
date.

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<PAGE> 181
EXCHANGE PRIVILEGE

The exchange privileges available for shareholders of the Classes and
for shareholders of classes of other funds in the Delaware Group are set forth
in the relevant prospectuses for such classes. The following supplements that
information. The Funds may modify, terminate or suspend the exchange privilege
upon 60 days' notice to shareholders.

All exchanges involve a purchase of shares of the fund into which the
exchange is made. As with any purchase, an investor should obtain and
carefully read that fund's prospectus before buying shares in an exchange. The
prospectus contains more complete information about the fund, including charges
and expenses. A shareholder requesting an exchange will be sent a current
prospectus and an authorization form for any of the other mutual funds in the
Delaware Group. Exchange instructions must be signed by the record owner(s)
exactly as the shares are registered.

An exchange constitutes, for tax purposes, the sale of one fund or
series and the purchase of another. The sale may involve either a capital gain
or loss to the shareholder for federal income tax purposes.

In addition, investment advisers and dealers may make exchanges
between funds in the Delaware Group on behalf of their clients by telephone or
other expedited means. This service may be discontinued or revised at any time
by the Transfer Agent. Such exchange requests may be rejected if it is
determined that a particular request or the total requests at any time could
have an adverse effect on any of the funds. Requests for expedited exchanges
may be submitted with a properly completed exchange authorization form, as
described above.

TELEPHONE EXCHANGE PRIVILEGE
Shareholders owning shares for which certificates have not been issued
or their investment dealers of record may exchange shares by telephone for
shares in other mutual funds in the Delaware Group. This service is
automatically provided unless the relevant Fund receives written notice from
the shareholder to the contrary.

Shareholders or their investment dealers of record may contact the
Shareholder Service Center at 800-523-1918 or, in the case of shareholders of
the Institutional Classes, their Client Services Representative at
800-828-5052, to effect an exchange. The shareholder's current Fund account
number must be identified, as well as the registration of the account, the
share or dollar amount to be exchanged and the fund into which the exchange is
to be made. Requests received on any day after the time the offering price and
net asset value are determined will be processed the following day. See
Determining Offering Price and Net Asset Value. Any new account established
through the exchange will automatically carry the same registration,
shareholder information and dividend option as the account from which the
shares were exchanged. The exchange requirements of the fund into which the
exchange is being made, such as sales charges, eligibility and investment
minimums, must be met. (See the prospectus of the fund desired or inquire by
calling the Transfer Agent or, as relevant, your Client Services
Representative.) Certain funds are not available for retirement plans.

The telephone exchange privilege is intended as a convenience to
shareholders and is not intended to be a vehicle to speculate on short-term
swings in the securities market through frequent transactions in and out of

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<PAGE> 182
the funds in the Delaware Group. Telephone exchanges may be subject to
limitations as to amounts or frequency. The Transfer Agent and the Funds
reserve the right to record exchange instructions received by telephone and to
reject exchange requests at any time in the future.

As described in the Funds' Prospectuses, neither the Funds nor the
Transfer Agent is responsible for any shareholder loss incurred in acting upon
written or telephone instructions for redemption or exchange of Fund shares
which are reasonably believed to be genuine.

RIGHT TO REFUSE TIMING ACCOUNTS
With regard to accounts that are administered by market timing
services ("Timing Firms") to purchase or redeem shares based on changing
economic and market conditions ("Timing Accounts"), the Funds will refuse any
new timing arrangements, as well as any new purchases (as opposed to exchanges)
in Delaware Group funds from Timing Firms. A Fund reserves the right to
temporarily or permanently terminate the exchange privilege or reject any
specific purchase order for any person whose transactions seem to follow a
timing pattern who: (i) makes an exchange request out of the Fund within two
weeks of an earlier exchange request out of the Fund, or (ii) makes more than
two exchanges out of the Fund per calendar quarter, or (iii) exchanges shares
equal in value to at least $5 million, or more than 1/4 of 1% of the Fund's net
assets. Accounts under common ownership or control, including accounts
administered so as to redeem or purchase shares based upon certain
predetermined market indicators, will be aggregated for purposes of the
exchange limits.

RESTRICTIONS ON TIMED EXCHANGES
Timing Accounts operating under existing timing agreements may only
execute exchanges between the following eight Delaware Group funds: (1) Decatur
Income Fund, (2) Decatur Total Return Fund, (3) Delaware Fund, (4) Limited-Term
Government Fund, (5) Tax-Free USA Fund, (6) Delaware Cash Reserve, (7)
Delchester Fund and (8) Tax-Free Pennsylvania Fund. No other Delaware Group
funds are available for timed exchanges. Assets redeemed or exchanged out of
Timing Accounts in Delaware Group funds not listed above may not be reinvested
back into that Timing Account. Each Fund reserves the right to apply these
same restrictions to the account(s) of any person whose transactions seem to
follow a timing pattern (as described above).

Each Fund also reserves the right to refuse the purchase side of an
exchange request by any Timing Account, person, or group if, in the Manager's
judgment, the Fund would be unable to invest effectively in accordance with its
investment objectives and policies, or would otherwise potentially be adversely
affected. A shareholder's purchase exchanges may be restricted or refused if a
Fund receives or anticipates simultaneous orders affecting significant portions
of the Fund's assets. In particular, a pattern of exchanges that coincide with
a "market timing" strategy may be disruptive to a Fund and therefore may be
refused.

Except as noted above, only shareholders and their authorized brokers
of record will be permitted to make exchanges or redemptions.

* * *

Following is a summary of the investment objectives of the other
Delaware Group funds:

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<PAGE> 183
DELAWARE FUND seeks long-term growth by a balance of capital
appreciation, income and preservation of capital. It uses a dividend- oriented
valuation strategy to select securities issued by established companies that
are believed to demonstrate potential for income and capital growth. DEVON
FUND seeks current income and capital appreciation by investing primarily in
income-producing common stocks, with a focus on common stocks the Manager
believes have the potential for above average dividend increases over time.

TREND FUND seeks long-term growth by investing in common stock issued
by emerging growth companies exhibiting strong capital appreciation potential.

DELCAP FUND seeks long-term capital growth by investing in common
stocks and securities convertible into common stocks of companies that have a
demonstrated history of growth and have the potential to support continued
growth.

DECATUR INCOME FUND seeks the highest possible current income by
investing primarily in common stocks that provide the potential for income and
capital appreciation without undue risk to principal. DECATUR TOTAL RETURN
FUND seeks long-term growth by investing primarily in securities that provide
the potential for income and capital appreciation without undue risk to
principal.

DELCHESTER FUND seeks as high a current income as possible by
investing principally in high yield, high risk corporate bonds, and also in
U.S. government securities and commercial paper. STRATEGIC INCOME FUND seeks
to provide investors with high current income and total return by using a
multi-sector investment approach, investing principally in three sectors of the
fixed-income securities markets: high-yield, higher risk securities,
investment grade fixed-income securities and foreign government and other
foreign fixed-income securities.

U.S. GOVERNMENT FUND seeks high current income by investing primarily
in long-term debt obligations issued or guaranteed by the U.S. government, its
agencies or instrumentalities.

LIMITED-TERM GOVERNMENT FUND seeks high, stable income by investing
primarily in a portfolio of short- and intermediate-term securities issued or
guaranteed by the U.S. government, its agencies or instrumentalities and
instruments secured by such securities. U.S. GOVERNMENT MONEY FUND seeks
maximum current income with preservation of principal and maintenance of
liquidity by investing only in short-term securities issued or guaranteed as to
principal and interest by the U.S. government, its agencies or
instrumentalities, and repurchase agreements collateralized by such securities,
while maintaining a stable net asset value.

DELAWARE CASH RESERVE seeks the highest level of income consistent
with the preservation of capital and liquidity through investments in
short-term money market instruments, while maintaining a stable net asset
value.

TAX-FREE USA FUND seeks high current income exempt from federal income
tax by investing in municipal bonds of geographically-diverse issuers.
TAX-FREE INSURED FUND invests in these same types of securities but with an
emphasis on municipal bonds protected by insurance guaranteeing principal and
interest are paid when due. TAX-FREE USA INTERMEDIATE FUND seeks a high level
of current interest income exempt from federal income tax, consistent with the
preservation of capital by investing primarily in municipal bonds.

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<PAGE> 184
TAX-FREE MONEY FUND seeks high current income, exempt from federal
income tax, by investing in short-term municipal obligations, while maintaining
a stable net asset value.

TAX-FREE PENNSYLVANIA FUND seeks a high level of current interest
income exempt from federal and, to the extent possible, certain Pennsylvania
state and local taxes, consistent with the preservation of capital.

INTERNATIONAL EQUITY FUND seeks to achieve long-term growth without
undue risk to principal by investing primarily in international securities that
provide the potential for capital appreciation and income. GLOBAL BOND FUND
seeks to achieve current income consistent with the preservation of principal
by investing primarily in global fixed-income securities that may also provide
the potential for capital appreciation. GLOBAL ASSETS FUND seeks to achieve
long-term total return by investing in global securities which will provide
higher current income than a portfolio comprised exclusively of equity
securities, along with the potential for capital growth. EMERGING MARKETS FUND
seeks long-term capital appreciation by investing primarily in equity
securities of issuers located or operating in emerging countries.

ENTERPRISE FUND seeks to provide maximum appreciation of capital by
investing in medium-sized companies which have a dominant position within their
industry, are undervalued, or have potential for growth in earnings. U.S.
GROWTH FUND seeks to maximize capital appreciation by investing in companies of
all sizes which have low dividend yields, strong balance sheets and high
expected earnings growth rates relative to their industry. WORLD GROWTH FUND
seeks to maximize total return (capital appreciation and income), principally
through investments in an internationally diversified portfolio of equity
securities. NEW PACIFIC FUND seeks long-term capital appreciation by investing
primarily in companies which are domiciled in or have their principal business
activities in the Pacific Basin. FEDERAL BOND FUND seeks to maximize current
income consistent with preservation of capital. The fund attempts to achieve
this objective by investing primarily in securities issued by the U.S.
government, its agencies and instrumentalities. CORPORATE INCOME FUND seeks to
provide high current income consistent with preservation of capital. The fund
attempts to achieve this objective primarily by investing in a diversified
portfolio of investment grade fixed-income securities issued by U.S.
corporations.

DELAWARE GROUP PREMIUM FUND offers ten funds available exclusively as
funding vehicles for certain insurance company separate accounts.
EQUITY/INCOME SERIES seeks the highest possible total rate of return by
selecting issues that exhibit the potential for capital appreciation while
providing higher than average dividend income. HIGH YIELD SERIES seeks as high
a current income as possible by investing in rated and unrated corporate bonds,
U.S. government securities and commercial paper. CAPITAL RESERVES SERIES seeks
a high stable level of current income while minimizing fluctuations in
principal by investing in a diversified portfolio of short- and
intermediate-term securities. MONEY MARKET SERIES seeks the highest level of
income consistent with preservation of capital and liquidity through
investments in short-term money market instruments. GROWTH SERIES seeks
long-term capital appreciation by investing its assets in a diversified
portfolio of securities exhibiting the potential for significant growth.
MULTIPLE STRATEGY SERIES seeks a balance of capital appreciation, income and
preservation of capital. It uses a dividend-oriented valuation strategy to
select securities issued by established companies that are believed to
demonstrate potential for income and capital growth. INTERNATIONAL EQUITY
SERIES seeks long-term growth without undue risk to principal by investing
primarily in equity securities of foreign issuers that provide the potential
for capital appreciation and income. VALUE SERIES seeks capital appreciation
by investing in small- to mid-cap common stocks whose market values appear low
relative to their underlying value or future earnings and growth potential.
Emphasis will also be placed on securities of companies that may be temporarily
out of favor or whose value is not yet recognized by

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<PAGE> 185
the market. EMERGING GROWTH SERIES seeks long-term capital appreciation by
investing primarily in small-cap common stocks and convertible securities of
emerging and other growth-oriented companies. These securities will have been
judged to be responsive to changes in the marketplace and to have fundamental
characteristics to support growth. Income is not an objective. GLOBAL BOND
SERIES seeks to achieve current income consistent with the preservation of
principal by investing primarily in global fixed-income securities that may
also provide the potential for capital appreciation.

The Manager, or its affiliate Delaware International Advisers Ltd.,
also manages the investment options for Delaware Medallion(sm) III Variable
Annuity. Medallion is issued by Allmerica Financial Life Insurance and Annuity
Company (First Allmerica Financial Life Insurance Company in New York and
Hawaii). Delaware Medallion offers 10 different investment series ranging from
domestic equity funds, international equity and bond funds and domestic fixed
income funds. Each investment series available through Medallion utilizes an
investment strategy and discipline the same as or similar to one of the
Delaware Group mutual funds available outside the annuity.

For more complete information about any of the Delaware Group funds,
including charges and expenses, you can obtain a prospectus from the
Distributor. Read it carefully before you invest or forward funds.

Each of the summaries above is qualified in its entirety by the
information contained in each fund's prospectus(es).

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<PAGE> 186
GENERAL INFORMATION

The Manager is the investment manager of each Fund. The Manager also
provides investment management services to certain of the other funds in the
Delaware Group. The Manager, through a separate division, also manages private
investment accounts. While investment decisions of each Fund are made
independently from those of the other funds and accounts, investment decisions
for such other funds and accounts may be made at the same time as investment
decisions for the Funds.

Access persons and advisory persons of the Delaware Group of funds, as
those terms are defined in Rule 17j-1 under the 1940 Act, who provide services
to the Manager, Delaware International Advisers Ltd. or their affiliates, are
permitted to engage in personal securities transactions subject to the
exceptions set forth in Rule 17j-1 and the following general restrictions and
procedures: (1) certain blackout periods apply to personal securities
transactions of those persons; (2) transactions must receive advance clearance
and must be completed on the same day as the clearance is received; (3) certain
persons are prohibited from investing in initial public offerings of securities
and other restrictions apply to investments in private placements of
securities; (4) opening positions may only be closed-out at a profit after a
60-day holding period has elapsed; and (5) the Compliance Officer must be
informed periodically of all securities transactions and duplicate copies of
brokerage confirmations and account statements must be supplied to the
Compliance Officer.

The Distributor acts as national distributor for each Fund and for the
other mutual funds in the Delaware Group. As previously described, prior to
January 3, 1995, DDI served as the national distributor for Value Fund. In its
capacity as such, DDI received net commissions from Value Fund on behalf of
Class A Shares after reallowances to dealers, as follows:

<TABLE>
<CAPTION>
FISCAL TOTAL AMOUNT AMOUNTS NET
YEAR OF UNDERWRITING REALLOWED COMMISSION
ENDED COMMISSION TO DEALERS TO DDI
----- ---------- ---------- ------
<S> <C> <C> <C>
November 30, 1995 $ 608,374 $ 527,679 $ 80,695
November 30, 1994 1,707,818 1,480,648 227,170
November 30, 1993 3,274,016 2,912,033 361,983
</TABLE>

The Distributor and, in its capacity as such, DDI received in the
aggregate Limited CDSC payments with respect to Value Fund A Class as follows:

<TABLE>
<CAPTION>
FISCAL YEAR ENDED LIMITED CDSC PAYMENTS
----------------- ---------------------
<S> <C>
November 30, 1995 $218
November 30, 1994 12,607
November 30, 1993 - 0 -
</TABLE>

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<PAGE> 187
The Distributor and, in its capacity as such, DDI received in the
aggregate CDSC payments with respect to Value Fund B Class as follows:

<TABLE>
<CAPTION>
FISCAL YEAR ENDED CDSC PAYMENTS
----------------- -------------
<S> <C>
November 30, 1995 $14,682
November 30, 1994* 995
</TABLE>

*Date of initial public offering was September 6, 1994.

The Distributor received CDSC payments with respect to Value Fund C
Class as follows:

<TABLE>
<CAPTION>
FISCAL YEAR ENDED CDSC PAYMENTS
----------------- -------------
<S> <C>
November 30, 1995* - $0 -
</TABLE>

*Date of initial public offering was November 29, 1995.

Effective as of January 3, 1995, all such payments described above
have been paid to the Distributor.

The Transfer Agent, an affiliate of the Manager, acts as shareholder
servicing, dividend disbursing and transfer agent for each Fund and for the
other mutual funds in the Delaware Group. The Transfer Agent is paid a fee by
each Fund for providing these services consisting of an annual per account
charge of $5.50 plus transaction charges for particular services according to a
schedule. Compensation is fixed each year and approved by the Board of
Directors, including a majority of the unaffiliated directors. The Transfer
Agent also provides accounting services to the Funds. Those services include
performing all functions related to calculating each Fund's net asset value and
providing all financial reporting services, regulatory compliance testing and
other related accounting services. For its services, the Transfer Agent is
paid a fee based on total assets of all funds in the Delaware Group for which
it provides such accounting services. Such fee is equal to 0.25% multiplied by
the total amount of assets in the complex for which the Transfer Agent
furnishes accounting services, where such aggregate complex assets are $10
billion or less, and 0.20% of assets if such aggregate complex assets exceed
$10 billion. The fees are charged to each fund, including the Funds, on an
aggregate pro-rata basis. The asset-based fee payable to the Transfer Agent is
subject to a minimum fee calculated by determining the total number of
investment portfolios and associated classes.

The Manager and its affiliates own the name "Delaware Group." Under
certain circumstances, including the termination of each Fund's advisory
relationship with the Manager or their distribution relationship with the
Distributor, the Manager and its affiliates could cause Equity Funds V, Inc. to
delete the words "Delaware Group" from Equity Funds V, Inc.'s name.

The Chase Manhattan Bank ("Chase"), 4 Chase Metrotech Center,
Brooklyn, NY 11245, is custodian of each Fund's securities and cash. As
custodian for a Fund, Chase maintains a separate account or accounts for the
Fund; receives, holds and releases portfolio securities on account of the Fund;
receives and disburses money on behalf of the Fund; and collects and receives
income and other payments and distributions on account of the Fund's portfolio
securities.

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<PAGE> 188

The legality of the issuance of the shares offered hereby, registered
pursuant to Rule 24f-2 under the 1940 Act, has been passed upon for Equity
Funds V, Inc. by Stradley, Ronon, Stevens & Young, LLP, Philadelphia,
Pennsylvania.

CAPITALIZATION
Equity Funds V, Inc. has a present authorized capitalization of one
billion shares of capital stock with a $.01 par value per share. The Board of
Directors has allocated three hundred fifty million shares to Value Fund. Of
such three hundred fifty million shares allocated to Value Fund, one hundred
fifty million shares have been allocated to Value Fund A Class, one hundred
million shares have been allocated to Value Fund B Class, fifty million shares
have been allocated to Value Fund C Class and fifty million shares have been
allocated to the Value Fund Institutional Class. The Board of Directors has
allocated two hundred million shares to Retirement Income Fund. Of such two
hundred million shares allocated to Retirement Income Fund, one hundred million
shares have been allocated to Retirement Income Fund A Class, twenty five
million shares have been allocated to Retirement Income Fund B Class, twenty
five million shares have been allocated to Retirement Income Fund C Class and
fifty million shares have been allocated to the Retirement Income Institutional
Class. Each Class represents a proportionate interest in the assets of a Fund,
and each has the same voting and other rights and preferences as the other
classes of the Fund, except that shares of the Institutional Classes may not
vote on any matter affecting a Fund Classes' Plans under Rule 12b-1.
Similarly, as a general matter, shareholders of Class A Shares, Class B Shares
and Class C Shares may vote only on matters affecting the 12b-1 Plan that
relates to the class of shares that they hold. However, Class B Shares may
vote on any proposal to increase materially the fees to be paid by a Fund under
the Plan relating to Class A Shares. General expenses of each Fund will be
allocated on a pro-rata basis to the classes according to asset size, except
that expenses of the Plans of Class A, Class B and Class C Shares will be
allocated solely to those classes.

Shares do not have preemptive rights, are fully transferable and, when
issued, are fully paid and nonassessable.

Prior to November 9, 1992, Equity Funds V, Inc. offered only one class
of shares, the class currently designated Value Fund A Class. Beginning
November 9, 1992, Equity Funds V, Inc. began offering the Value Fund
Institutional Class, beginning September 6, 1994, Equity Funds V, Inc. began
offering the Value Fund B Class, and beginning November 29, 1995, Equity Funds
V, Inc. began offering the Value Fund C Class. Prior to September 6, 1994, the
Value Fund A Class was known as the Value Fund class and the Value Fund
Institutional Class was known as the Value Fund (Institutional) class. Prior
to November 29, 1996, Delaware Group Equity Funds V, Inc. was known as Delaware
Group Value Fund, Inc.

NONCUMULATIVE VOTING
EQUITY FUNDS V, INC. SHARES HAVE NONCUMULATIVE VOTING RIGHTS WHICH
MEANS THAT THE HOLDERS OF MORE THAN 50% OF THE AGGREGATE SHARES OF THE FUNDS
VOTING FOR THE ELECTION OF DIRECTORS CAN ELECT ALL THE DIRECTORS IF THEY CHOOSE
TO DO SO, AND, IN SUCH EVENT, THE HOLDERS OF THE REMAINING SHARES WILL NOT BE
ABLE TO ELECT ANY DIRECTORS.

This Part B does not include all of the information contained in the
Registration Statement which is on file with the Securities and Exchange
Commission.

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<PAGE> 189
APPENDIX A--IRA INFORMATION

An individual can contribute up to $2,000 to his or her IRA each year.
Contributions may or may not be deductible depending upon the taxpayers
adjusted gross income and whether the taxpayer or his or her spouse is an
active participant in an employer-sponsored retirement plan. Even if a
taxpayer (or his or her spouse) is an active participant in an
employer-sponsored retirement plan, the full $2,000 deduction is still
available if the taxpayer's adjusted gross income is below $25,000 ($40,000 for
taxpayers filing joint returns). A partial deduction is allowed for married
couples with incomes between $40,000 and $50,000, and for single individuals
with incomes between $25,000 and $35,000. No deductions are available for
contributions to IRAs by taxpayers whose adjusted gross income before IRA
deductions exceeds $50,000 ($35,000 for singles) and who are active
participants in an employer-sponsored retirement plan. Taxpayers who were not
allowed deductions on IRA contributions still can make nondeductible IRA
contributions of as much as $2,000 for each working spouse ($2,250 for
one-income couples for years prior to 1997), and defer taxes on interest or
other earnings from the IRAs. Special rules apply for determining the
deductibility of contributions made by married individuals filing separate
returns.

As illustrated in the following tables, maintaining an IRA remains a
valuable opportunity.

For many, an IRA will continue to offer both an up-front tax break
with its tax deduction each year and the real benefit that comes with
tax-deferred compounding. For others, losing the tax deduction will impact
their taxable income status each year. Over the long term, however, being able
to defer taxes on earnings still provides an impressive investment
opportunity--a way to have money grow faster due to tax- deferred compounding.

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<PAGE> 190
Even if your IRA contribution is no longer deductible, the benefits of
saving on a tax-deferred basis can be substantial. The following tables
illustrate the benefits of tax-deferred versus taxable compounding. Each
reflects a constant 10% rate of return, compounded annually, with the
reinvestment of all proceeds. The tables do not take into account any sales
charges or fees. Of course, earnings accumulated in your IRA will be subject
to tax upon withdrawal. If you choose a mutual fund with a fluctuating net
asset value, like either Fund, your bottom line at retirement could be
lower--it could also be much higher.

$2,000 INVESTED ANNUALLY ASSUMING A 10% ANNUALIZED RETURN

15% Tax Bracket Single - $0 - $24,000
Joint - $0 - $40,100
<TABLE>
<CAPTION>
HOW MUCH YOU
END OF CUMULATIVE HOW MUCH YOU HAVE WITH FULL
YEAR INVESTMENT AMOUNT HAVE WITHOUT IRA IRA DEDUCTION
<S> <C> <C> <C>
1 $ 2,000 $ 1,844 $ 2,200
5 10,000 10,929 13,431
10 20,000 27,363 35,062
15 30,000 52,074 69,899
20 40,000 89,231 126,005
25 50,000 145,103 216,364
30 60,000 229,114 361,887
35 70,000 355,438 596,254
40 80,000 545,386 973,704
</TABLE>

[Without IRA--investment of $1,700 ($2,000 less 15%) earning 8.5% (10% less
15%)]

28% Tax Bracket Single - $24,001 - $58,150
Joint - $40,101 - $96,900

<TABLE>
<CAPTION>
END OF CUMULATIVE HOW MUCH YOU HOW MUCH YOU HAVE WITH FULL IRA
YEAR INVESTMENT AMOUNT HAVE WITHOUT IRA NO DEDUCTION DEDUCTION
<S> <C> <C> <C> <C>
1 $ 2,000 $ 1,544 $ 1,584 $ 2,200
5 10,000 8,913 9,670 13,431
10 20,000 21,531 25,245 35,062
15 30,000 39,394 50,328 69,899
20 40,000 64,683 90,724 126,005
25 50,000 100,485 155,782 216,364
30 60,000 151,171 260,559 361,887
35 70,000 222,927 429,303 596,254
40 80,000 324,512 701,067 973,704
</TABLE>

[Without IRA--investment of $1,440 ($2,000 less 28%) earning 7.2% (10% less
28%)]
[With IRA--No Deduction--investment of $1,440 ($2,000 less 28%) earning 10%]

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<PAGE> 191
31% Tax Bracket Single - $58,151 - $121,300
Joint - $96,901 - $147,700

<TABLE>
<CAPTION>
END OF CUMULATIVE HOW MUCH YOU HOW MUCH YOU HAVE WITH FULL IRA
YEAR INVESTMENT AMOUNT HAVE WITHOUT IRA NO DEDUCTION DEDUCTION
<S> <C> <C> <C> <C>
1 $ 2,000 $ 1,475 $ 1,518 $ 2,200
5 10,000 8,467 9,268 13,431
10 20,000 20,286 24,193 35,062
15 30,000 36,787 48,231 69,899
20 40,000 59,821 86,943 126,005
25 50,000 91,978 149,291 216,364
30 60,000 136,868 249,702 361,887
35 70,000 199,536 411,415 596,254
40 80,000 287,021 671,855 973,704
</TABLE>

[Without IRA--investment of $1,380 ($2,000 less 31%) earning 6.9% (10% less
31%)]
[With IRA--No Deduction--investment of $1,380 ($2,000 less 31%) earning 10%]

36% Tax Bracket* Single - $121,301 - $263,750
Joint - $147,701 - $263,750

<TABLE>
<CAPTION>
END OF CUMULATIVE HOW MUCH YOU HOW MUCH YOU HAVE WITH FULL IRA
YEAR INVESTMENT AMOUNT HAVE WITHOUT IRA NO DEDUCTION DEDUCTION
<S> <C> <C> <C> <C>
1 $ 2,000 $ 1,362 $ 1,408 $ 2,200
5 10,000 7,739 8,596 13,431
10 20,000 18,292 22,440 35,062
15 30,000 32,683 44,736 69,899
20 40,000 52,308 80,643 126,005
25 50,000 79,069 138,473 216,364
30 60,000 115,562 231,608 361,887
35 70,000 165,327 381,602 596,254
40 80,000 233,190 623,170 973,704
</TABLE>

[Without IRA--investment of $1,280 ($2,000 less 36%) earning 6.4% (10% less
36%)]
[With IRA--No Deduction--investment of $1,280 ($2,000 less 36%) earning 10%]

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<PAGE> 192
39.6% Tax Bracket* Single - over $263,750
Joint - over $263,750

<TABLE>
<CAPTION>
END OF CUMULATIVE HOW MUCH YOU HOW MUCH YOU HAVE WITH FULL IRA
YEAR INVESTMENT AMOUNT HAVE WITHOUT IRA NO DEDUCTION DEDUCTION
<S> <C> <C> <C> <C>
1 $ 2,000 $ 1,281 $ 1,329 $ 2,200
5 10,000 7,227 8,112 13,431
10 20,000 16,916 21,178 35,062
15 30,000 29,907 42,219 69,899
20 40,000 47,324 76,107 126,005
25 50,000 70,677 130,684 216,364
30 60,000 101,986 218,580 361,887
35 70,000 143,965 360,137 596,254
40 80,000 200,249 588,117 973,704
</TABLE>

[Without IRA--investment of $1,208 ($2,000 less 39.6%) earning 6.04% (10% less
39.6%)]
[With IRA--No Deduction--investment of $1,208 ($2,000 less 39.6%) earning 10%]

* For tax years beginning after 1992, a 36% tax rate applies to all
taxable income in excess of the maximum dollar amounts subject to the
31% tax rate. In addition, a 10% surtax (not applicable to capital
gains) applies to certain high-income taxpayers. It is computed by
applying a 39.6% rate to taxable income in excess of $263,750. The
above tables do not reflect the personal exemption phaseout nor the
limitations of itemized deductions that may apply.

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<PAGE> 193
$2,000 SINGLE INVESTMENT AT A RETURN OF 10% COMPOUNDED ANNUALLY

<TABLE>
<CAPTION>
TAXABLE - TAXABLE - TAXABLE - TAXABLE - TAXABLE - TAX
YEARS 39.6%* 36%* 31% 28% 15% DEFERRED
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
10 $ 3,595 $ 3,719 $ 3,898 $ 4,008 $ 4,522 $ 5,187

15 4,820 5,072 5,441 5,675 6,799 8,354

20 6,463 6,916 7,596 8,034 10,224 13,455

30 11,618 12,861 14,803 16,102 23,117 34,899

40 20,884 23,916 28,849 32,272 52,266 90,519

</TABLE>

$2,000 INVESTED ANNUALLY AT A RETURN OF 10% COMPOUNDED ANNUALLY

15 49,514 51,067 53,314 54,714 61,264 69,899

20 78,351 81,731 86,697 89,838 104,978 126,005

30 168,852 180,566 198,360 209,960 269,546 361,887

40 331,537 364,360 415,973 450,711 641,631 973,704

</TABLE>

-79-
<PAGE> 194
THE VALUE OF STARTING YOUR IRA EARLY
The following illustrates how much more you would have contributing
$2,000 each January--the earliest opportunity--compared to contributing on
April 15th of the following year--the latest, for each tax year.

<TABLE>
<S> <C> <C>
After 5 years $ 3,528 more
10 years $ 6,113
20 years $17,228
30 years $47,295
</TABLE>

Compounded returns for the longest period of time is the key. The
above illustration assumes a 10% rate of return and the reinvestment of all
proceeds.

And it pays to shop around. If you get just 2% more per year, it can
make a big difference when you retire. A constant 8% versus 10% return, both
compounded annually, illustrates the point. This chart is based on a yearly
investment of $2,000 on January 1. After 30 years the difference can mean as
much as 50% more!

<TABLE>
<CAPTION>
8% RETURN 10% RETURN
--------- ----------
<S> <C> <C>
10 years $ 31,291 $ 35,062
20 years $ 98,846 $126,005
30 years $244,692 $361,887
</TABLE>

The statistical exhibits above are for illustration purposes only and
do not reflect the actual performance for the Funds, either in the past or in
the future.

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<PAGE> 195
APPENDIX B

THE COMPANY LIFE CYCLE
Traditional business theory contends that a typical company progresses
through basically four stages of development, keyed closely to a firm's sales.

1. EMERGING GROWTH--a period of experimentation in which the
company builds awareness of a new product or firm.

2. ACCELERATED DEVELOPMENT--a period of rapid growth with
potentially high profitability and acceptance of the product.

3. MATURING PHASE--a period of diminished real growth due to
dependence on replacement or sustained product demand.

4. CYCLICAL STAGE--a period in which a company faces a potential
saturation of demand for its product. At this point, a firm either diversifies
or becomes obsolete.

HYPOTHETICAL CORPORATE LIFE CYCLE

[CHART APPEARS HERE]

Hypothetical Corporate Life Cycle Chart shows in a line illustration,
the stages that a typical company would go through, beginning with the emerging
state where sales growth continues at a steep pace to the mature phase where
growth levels off to the cyclical stage where sales show more definitive highs
and lows.

The above chart illustrates the path traditionally followed by
companies that successfully survive the growth sequence.

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<PAGE> 196
FINANCIAL STATEMENTS

Ernst & Young LLP serves as the independent auditors for Equity Funds
V, Inc. and, in its capacity as such, audits the financial statements contained
in Equity Funds V, Inc.'s Annual Report. Value Fund's Statement of Net Assets,
Statement of Operations, Statements of Changes in Net Assets and Notes to
Financial Statements, as well as the report of Ernst & Young LLP, independent
auditors, for the fiscal year ended November 30, 1995, are included in Value
Fund's Annual Report to shareholders. The financial statements, the notes
relating thereto and the report of Ernst & Young LLP, listed above are
incorporated by reference from the Annual Report into this Part B. Unaudited
financial statements and the notes relating thereto for the six-month period
ended May 31, 1996 are also incorporated by reference from Value Fund's
Semi-Annual Report into this Part B. Retirement Income Fund was not offered to
the public prior to the date of this Part B.

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