<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR FUNDS OCTOBER 31, 1996
CAPITAL APPRECIATION FUND
EMERGING GROWTH FUND
INTERNATIONAL EQUITY FUND
JAPAN OTC FUND
EMERGING MARKETS FUND
POST-VENTURE CAPITAL FUND
JAPAN GROWTH FUND
SMALL COMPANY VALUE FUND
GLOBAL POST-VENTURE CAPITAL FUND
A
ANNUAL REPORT
A Prospectus containing more complete information, including
charges and expenses and, where applicable, the special
considerations and risks associated with international
investing, may be obtained by calling 800-369-2728 or by writing
to Warburg Pincus Funds, P.O. Box 9030, Boston, MA 02205-9030.
Investors should read the Prospectus carefully before investing.
[WARBURG PINCUS LOGO]
INVESTMENTS
<PAGE>
<PAGE>
The views of the Funds' management are as of the date of the letters and
portfolio holdings described in this annual report are as of October 31, 1996;
these views and portfolio holdings may have changed subsequent to these dates.
Nothing in this annual report is a recommendation to purchase or sell
securities.
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR CAPITAL APPRECIATION FUND
ANNUAL INVESTMENT ADVISER'S REPORT
- --------------------------------------------------------------------------------
Dear Shareholder: December 11, 1996
The objective of Warburg Pincus Advisor Capital Appreciation Fund (the
'Fund') is long-term capital appreciation. The Fund invests primarily in a
diversified selection of medium-size domestic companies deemed to have high
growth potential, such as those undergoing significant fundamental changes or
generating a large free cash flow.
For the 12 months ended October 31, 1996, the Fund rose 24.15%, vs. gains of
24.01% in the Standard & Poor's 500 Index, 16.94% in the Lipper Growth Funds
Index and 17.29% in the Standard & Poor's MidCap 400 Index.
The Fund benefited from strong performances from many of its holdings during
the 12 months. The Fund saw particularly robust gains in its financial stocks
(including both banks & savings & loans and financial-services companies), which
collectively displayed market-beating returns despite an unsettled interest-rate
environment through much of the period.
Timely exposure to the technology sector also helped the Fund. We had
underweighted the group through much of the period based largely on valuation
concerns, and had a very small representation heading into June and July, when
the sector corrected. We used the sell-off to add several attractive companies
to the portfolio, including Compaq Computer and Dell Computer, and thus
participated in the sector's strong recovery in August and September.
Other positive contributors to the Fund's performance included its holdings
in aerospace & defense, energy and chemicals. Monsanto, from the last group, saw
a surge in its stock price during the period, reflecting favorable investor
reaction to new products from the company's agricultural-products unit. Another
noteworthy performer for the Fund was Avery-Dennison, which rallied on strong
growth in the company's office-products and adhesives businesses.
Avery-Dennison's stock had a total return of nearly 50% for the period.
<TABLE>
<S> <C>
George U. Wyper Susan L. Black
Co-Portfolio Manager Co-Portfolio Manager
</TABLE>
1
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<PAGE>
WARBURG PINCUS ADVISOR CAPITAL APPRECIATION FUND
ANNUAL INVESTMENT ADVISER'S REPORT (CONT'D)
- --------------------------------------------------------------------------------
GROWTH OF $10,000 INVESTED IN ADVISOR SHARES OF WARBURG PINCUS ADVISOR
CAPITAL APPRECIATION FUND SINCE INCEPTION AS OF OCTOBER 31, 1996
The graph below illustrates the hypothetical investment of $10,000 in Advisor
Shares of Warburg Pincus Advisor Capital Appreciation Fund (the 'Fund') from
April 4, 1991 (inception) to October 31, 1996, compared to the S&P 500* for the
same time period.
AVERAGE ANNUAL TOTAL RETURNS
FOR PERIODS ENDED 10/31/96
CAP APP S & P 500 (ADVISOR sHARES)
------- --------- ----------------------------
Apr-91 10,000 10,000 1 year
Oct-91 10,315.63 10,620.80 24.15%
Oct-92 11,329.68 11,674.78
Oct-93 13,781.12 13,415.32 5 year
Oct-94 13,950.07 13,928.35 15.69%
Oct-95 17,215.97 17,601.30
Oct-96 21,374.08 21,826.70 Since Inception
(4/4/91)
14.25%
<TABLE>
<CAPTION>
FUND
------
<S> <C>
1 Year Total Return (9/30/95-9/30/96)....................................... 23.47%
5 Year Average Annual Total Return (9/30/91-9/30/96)........................ 15.92%
Average Annual Total Return Since Inception (8/17/87-9/30/96)............... 14.33%
</TABLE>
Returns are historical and include changes in share price and reinvestment of
dividends and capital gains. Past performance cannot guarantee future results.
Returns and share price will fluctuate, and redemption value may be more or less
than original cost.
- ------------
* The S&P 500 is an unmanaged index (with no defined investment objective) of
common stocks which includes reinvestment of dividends and is a registered
trademark of Standard & Poor's Corporation.
2
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR EMERGING GROWTH FUND
ANNUAL INVESTMENT ADVISER'S REPORT
- --------------------------------------------------------------------------------
Dear Shareholder: December 11, 1996
The objective of Warburg Pincus Advisor Emerging Growth Fund (the 'Fund') is
maximum capital appreciation. The Fund targets small and medium-size U.S.
companies that have successfully completed the start-up phase, show positive
earnings momentum and are deemed to have the potential to achieve significant
profit and capital gain within a relatively short period of time.
For the 12 months ended October 31, 1996, the Fund gained 15.69%, vs. gains
of 17.14% in the Lipper Small Company Growth Funds Index, 16.61% in the Russell
2000 Index and 24.01% in the Standard & Poor's 500 Index.
Positive contributors to the Fund's performance during the 12 months included
its holdings in business services, an area that we believe offers very
attractive investment opportunities and one that we continue to emphasize in the
portfolio. Selected companies in this industry have been and stand to remain
significant beneficiaries of Corporate America's ongoing restructuring and cost-
cutting efforts. A number of the Fund's stocks saw excellent returns during the
period, reflecting the market's growing recognition of their prospects.
Particularly strong performances came from holdings in American Management
Systems and Catalina Marketing Corp.
One area of significant weakness was its health-care exposure, in particular
its biotechnology-related stocks. We consider the Fund's holdings in this area
to be strong, well-managed businesses with very good long-term earnings
prospects. Unfortunately, their performance during the reporting period suffered
along with that of most health-care stocks, as investors downgraded the sector
in a broad-brush stroke on concerns over pricing and margin pressures. Near-term
weakness aside, we remain committed to the sector as a long-term investment
theme, given the very favorable demographics that stand to support demand for
health care well into the next century.
The Fund's technology exposure, on balance, enhanced its performance during
the reporting period, despite the sector's sharp pullback in June and July.
Helping the Fund, in relative terms, was its underweighting in makers of
commodity-type products (e.g., semiconductors) heading into the correction, as
these stocks were among the hardest hit by the downdraft. We used the resulting
price weakness in technology stocks to add selected names to the portfolio,
including several semiconductor-related companies, based on our view that the
3
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WARBURG PINCUS ADVISOR EMERGING GROWTH FUND
ANNUAL INVESTMENT ADVISER'S REPORT (CONT'D)
- --------------------------------------------------------------------------------
industry's fundamentals had begun to improve. This increased exposure proved
timely, as technology stocks collectively, and semiconductor issues
specifically, rallied in August and September.
<TABLE>
<S> <C>
Elizabeth B. Dater Stephen J. Lurito
Co-Portfolio Manager Co-Portfolio Manager
</TABLE>
4
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR EMERGING GROWTH FUND
ANNUAL INVESTMENT ADVISER'S REPORT (CONT'D)
- --------------------------------------------------------------------------------
GROWTH OF $10,000 INVESTED IN ADVISOR SHARES OF WARBURG PINCUS ADVISOR
EMERGING GROWTH FUND SINCE INCEPTION AS OF OCTOBER 31, 1996
The graph below illustrates the hypothetical investment of $10,000 in Advisor
Shares of Warburg Pincus Advisor Emerging Growth Fund (the 'Fund') from April 4,
1991 (inception) to October 31, 1996, compared to the S&P 500* and Lipper Small
Company Growth Funds Index ('Lipper Small Co.')** for the same time period.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
FOR PERIODS ENDED 10/31/96
EMERGING GROWTH S & P 500 LIPSGRI (ADVISOR SHARES)
--------------- --------- ------- ----------------------------
<S> <C> <C> <C> <C>
Apr-91 10,000 10,000 10,000 1 year
Oct-91 11,697.68 10,620.80 11,264.09 15.69%
Oct-92 12,770.10 11,674.78 12,058.16
Oct-93 16,813.70 13,415.32 15,612.47 5 year
Oct-94 16,765.62 13,928.35 15,939.52 17.18%
Oct-95 22,338.95 17,601.30 19,698.37
Oct-96 25,844.30 21,826.70 23,075.30 Since Inception
(4/4/91)
17.61%
</TABLE>
<TABLE>
<CAPTION>
FUND
-----
<S> <C>
1 Year Total Return (9/30/95-9/30/96)........................................ 13.57%
5 Year Average Annual Total Return (9/30/91-9/30/96)......................... 19.11%
Average Annual Total Return Since Inception (1/21/88-9/30/96)................ 18.20%
</TABLE>
Returns are historical and include changes in share price and reinvestment of
dividends and capital gains. Past performance cannot guarantee future results.
Returns and share price will fluctuate, and redemption value may be more or less
than original cost.
- ------------
* The S&P 500 is an unmanaged index (with no defined investment objective) of
common stocks which includes reinvestment of dividends and is a registered
trademark of Standard & Poor's Corporation.
** The Lipper Small Company Growth Funds Index is an equal-weighed index of the
30 largest small company growth funds that is compiled by Lipper Analytical
Services, Inc.
5
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<PAGE>
WARBURG PINCUS ADVISOR INTERNATIONAL EQUITY FUND
ANNUAL INVESTMENT ADVISER'S REPORT
- --------------------------------------------------------------------------------
Dear Shareholder: December 11, 1996
The objective of Warburg Pincus Advisor International Equity Fund (the
'Fund') is long-term capital appreciation. The Fund aims to tap into the strong
growth potential of today's world stock markets by investing primarily in a
diversified selection of companies whose principal business activities and
interests are outside the U.S.
For the 12 months ended October 31, 1996, the Fund gained 9.89%, vs. gains of
12.65% in the Lipper International Funds Index and 10.47% in the Morgan Stanley
Europe, Australasia and Far East ('EAFE') Index.
The Fund's largest country weighting throughout the period remained Japan,
whose stock market performed well through much of the 12 months but suffered in
the latter part of the period, primarily due to fears that the country's
economic recovery might be faltering. We believe that Japan's recovery remains
very much intact, however, supported by a continued expansionary monetary policy
from the Bank of Japan and, over the longer term, by the ongoing restructuring
of Japanese industry. Accordingly, we maintained the country's weighting in the
portfolio through the period, as well as our emphasis on the machinery &
industrial components and retail sectors, where we believe some of the best
long-term investment opportunities exist.
We hedged, as a defensive measure, a significant proportion of the Fund's yen
exposure through the period. This had a positive effect on the Fund's
performance, as the Japanese currency weakened against the U.S. dollar.
The Fund benefited from positive performances from a number of its other
Asian-Pacific stocks. Particularly strong performers for the Fund included
selected holdings in Hong Kong and Taiwan. One market that weighed on the Fund's
performance during the 12 months was South Korea, which was negatively impacted
by the country's unsettled political climate and by concerns over a
deteriorating trade balance. But South Korean stocks remain inexpensive and we
believe that the market has good prospects for improvement, thus we have
maintained its weighting in the portfolio. We have also maintained the Fund's
general emphasis on Asian-Pacific markets, collectively, reflecting our positive
outlook on their longer-term (i.e., three- to five-year) prospects. These
economies boast both the world's fastest growth rates and the most attractive
fundamentals (e.g., high domestic savings rates, strong currencies and generally
6
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<PAGE>
WARBURG PINCUS ADVISOR INTERNATIONAL EQUITY FUND
ANNUAL INVESTMENT ADVISER'S REPORT (CONT'D)
- --------------------------------------------------------------------------------
pro-business governmental policies), which should, we believe, result in some
very attractive investment opportunities.
European equity markets appreciated strongly during the period, though they
were as a group underweighted versus the index and other international funds.
The Fund benefited from this broad-based strength, with particularly impressive
gains coming from German holdings SGL Carbon and Adidas and from its Nordic
stocks collectively. The markets' performance notwithstanding, we continued to
find attractively valued companies on a selective basis across Europe during the
period. Further, we believe that lower interest rates stand to lead to improved
economic growth across the Continent in 1997, resulting in higher corporate
earnings and proportionately more investment opportunities.
<TABLE>
<S> <C>
Richard H. King
Portfolio Manager
</TABLE>
7
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR INTERNATIONAL EQUITY FUND
ANNUAL INVESTMENT ADVISER'S REPORT (CONT'D)
- --------------------------------------------------------------------------------
GROWTH OF $10,000 INVESTED IN ADVISOR SHARES OF WARBURG PINCUS ADVISOR
INTERNATIONAL EQUITY FUND SINCE INCEPTION AS OF OCTOBER 31, 1996
The graph below illustrates the hypothetical investment of $10,000 in Advisor
Shares of Warburg Pincus Advisor International Equity Fund (the 'Fund') from
April 5, 1991 (inception) to October 31, 1996, compared to the Morgan Stanley
Europe, Australasia and Far East Index ('EAFE')* for the same time period.
AVERAGE ANNUAL TOTAL RETURNS
FOR PERIODS ENDED 10/31/96
INT'L EQUITY MS-EAFE (ADVISOR SHARES)
------------ --------- ----------------------------
Apr-91 10,000.00 10,000.00 1 year
Oct-91 10,605.93 10,308.97 9.89%
Oct-92 9,666.65 8,946,75
Oct-93 13,539.01 12,298.46 5 year
Oct-94 16,351.14 13,540.91 10.44%
Oct-95 15,853.36 13,491.43
Oct-96 17,422.01 14,904.57 Since Inception
(4/5/91)
10.16%
<TABLE>
<CAPTION>
FUND
------
<S> <C>
1 Year Total Return (9/30/95-9/30/96)........................................ 8.69%
5 Year Average Annual Total Return (9/30/91-9/30/96)......................... 10.91%
Average Annual Total Return Since Inception (5/02/89-9/30/96)................ 10.54%
</TABLE>
Returns are historical and include changes in share price and reinvestment of
dividends and capital gains. Past performance cannot guarantee future results.
Returns and share price will fluctuate, and redemption value may be more or less
than original cost.
- ------------
* EAFE is an unmanaged index of international equities with no defined
investment objective that is compiled by Morgan Stanley Capital
International.
8
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR JAPAN OTC FUND
ANNUAL INVESTMENT ADVISER'S REPORT
- --------------------------------------------------------------------------------
Dear Shareholder: December 11, 1996
The objective of Warburg Pincus Advisor Japan OTC Fund (the 'Fund') is
long-term capital appreciation. The Fund invests primarily in securities traded
on the Japanese over-the-counter (OTC) market. At all times, except during
temporary defensive periods, the Fund maintains at least 65% of its assets in
these OTC securities.
For the 12 months ended October 31, 1996, the Fund had a total return of
- -3.17%, vs. total returns of 0.24% and -9.88% for the yen- and dollar-
denominated JASDAQ indexes, respectively.
Deteriorating investor sentiment in the latter months of the reporting period
took a significant toll on the Japanese OTC market, which had shown strong gains
through the first half of the period. Concerns over the economy's health led
many investors to sell shares, as some evidence suggested that the recovery
might be faltering. At the same time, other investors feared that signs of
strength in the economy might lead to a tightening of monetary policy by the
Bank of Japan. This further undermined sentiment.
Our view on the Japanese OTC market remains positive, despite its
disappointing performance over the last several months. Reasons for optimism are
several. First, we believe that the Bank of Japan will maintain a benign
monetary policy until definitive signs of economic recovery are apparent. This
should enhance the relative attractiveness of equities and also aid the
economy's expansion, particularly the recapitalization of the still-troubled
banking system. And it should be noted that OTC stocks have historically
outperformed larger-cap Japanese stocks in rising-interest-rate environments,
which augurs well for their performance when interest rates do, ultimately,
rise.
A second reason for optimism is that earnings for OTC companies continue to
recover. Compared to the larger companies trading on the Tokyo Stock Exchange,
whose sales are fluctuating, smaller Japanese companies collectively are
experiencing strong growth in both sales and earnings, which suggests an
improvement in share-price performance as investors pay increasing attention to
these companies' prospects.
Yet another reason for optimism is the large pool of potential investment
represented by Japan's pension funds. Much of this money (estimated at several
9
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR JAPAN OTC FUND
ANNUAL INVESTMENT ADVISER'S REPORT (CONT'D)
- --------------------------------------------------------------------------------
trillion yen) is slated to be channeled into equities, and some of it should
find its way to OTC stocks, which are gaining popularity among institutional
investors. This potential inflow of assets into the relatively less-liquid OTC
market stands to have a significant impact on stock prices.
Set within this context, we will continue our research efforts in an effort
to identify those companies with the best prospects. We continue to find good
investment opportunities across a broad range of sectors, but particularly so
among consumer-related companies, which are major beneficiaries of the ongoing
recovery in consumption and represent a major portion of the Fund's assets. In
general, our holdings in these companies had a positive impact on the Fund's
performance during the period, and we believe that they continue to have good
potential.
Another factor that contributed positively to the Fund's returns during the
reporting period was its currency hedging. The Fund's general policy is to hedge
virtually all of its yen exposure back into U.S. dollars. This proved beneficial
during the period, as the yen weakened against the dollar (reflected in the
performance disparity between the yen- and dollar-denominated JASDAQ indexes).
<TABLE>
<S> <C>
Shuhei Abe Nicholas P.W. Horsley
Co-Portfolio Manager Co-Portfolio Manager
</TABLE>
10
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR JAPAN OTC FUND
ANNUAL INVESTMENT ADVISER'S REPORT (CONT'D)
- --------------------------------------------------------------------------------
GROWTH OF $10,000 INVESTED IN ADVISOR SHARES OF WARBURG PINCUS ADVISOR
JAPAN OTC FUND SINCE INCEPTION AS OF OCTOBER 31, 1996
The graph below illustrates the hypothetical investment of $10,000 in Advisor
Shares of Warburg Pincus Advisor Japan OTC Fund (the 'Fund') from September 30,
1994 (inception) to October 31, 1996, compared to the JASDAQ* for the same time
period.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
FOR PERIODS ENDED 10/31/96
JAPAN OTC JASDAQ-YEN JASDAQ-US$ (ADVISOR SHARES)
--------- ---------- ---------- ----------------------------
<S> <C> <C> <C> <C>
Sep-94 10,000 10,000 10,000 1 year
Oct-94 9,850.00 9,698.90 9,901.00 -3.17%
Oct-95 9,080.00 8,192.29 7,930.04
Oct-96 8,792.33 8,211.72 7,146.10 Since Inception
(9/30/94)
-5.97%
</TABLE>
<TABLE>
<CAPTION>
FUND
----------
<S> <C>
1 Year Total Return (9/30/95-9/30/96)........................................ 2.33%
Average Annual Total Return Since Inception (9/30/94-9/30/96)................ -3.60%
</TABLE>
Returns are historical and include changes in share price and reinvestment of
dividends and capital gains. Past performance cannot guarantee future results.
Returns and share price will fluctuate, and redemption value may be more or less
than original cost.
From time to time, the Fund's investment adviser and co-administrators may
waive some fees and/or reimburse some expenses, without which performance would
be lower. Waivers and/or reimbursements are subject to change.
- ------------
* The JASDAQ Over-The-Counter Composite Index is an unmanaged index comprised
of stocks traded over-the-counter in Japan.
** Stated in Yen
*** Stated in U.S. dollars
11
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR EMERGING MARKETS FUND
ANNUAL INVESTMENT ADVISER'S REPORT
- --------------------------------------------------------------------------------
Dear Shareholder: December 11, 1996
The objective of Warburg Pincus Advisor Emerging Markets Fund (the 'Fund') is
growth of capital. The Fund is a non-diversified investment company that invests
primarily in equity securities of companies in emerging securities markets
around the world.
For the 12 months ended October 31, 1996, the Fund gained 9.20%, vs. a gains
of 9.56% in the Lipper Emerging Markets Funds Index and 6.49% in the Morgan
Stanley Emerging Markets Free Index.
The Fund's holdings in Asian-Pacific emerging markets, which comprised the
largest portion of its assets through the period, generally proved positive
contributors to its performance. The Fund saw particularly strong gains from its
holdings in China, Hong Kong and Taiwan. (Two markets that weighed on the Fund's
performance were South Korea and Thailand, which suffered from political and
economic concerns. But we consider both to be attractively valued, hence we
maintained the respective countries' representation in the Fund.) The Fund's
general emphasis on Asian-Pacific markets is based on our belief that their
long-term growth prospects are superior, as a rule, to those of other emerging
markets (e.g., Latin America or Eastern Europe), due in large measure to
Asian-Pacific economies' vastly higher savings and investment rates. Asian-
Pacific countries also typically have better government policies, from a
business and investment perspective, and more stable currencies than other
developing countries, which further enhances their appeal.
The Fund remained underweighted in Latin America through the period,
reflecting our general view that better long-term investment opportunities exist
elsewhere. Though this worked to the Fund's disadvantage during the period, as
Latin American markets collectively performed strongly, we believe that the
strategy will prove its merits over the longer term. That said, we continued to
identify selective values in Latin America during the 12 months, and the Fund's
performance benefited from strong gains in Mexican stock Gruma, a tortilla
manufacturer, and Brazilian stock Pan American Beverage Company, the largest
Coca-Cola bottler in Latin America.
Eastern European equity markets appreciated strongly during the period. The
Fund benefited from the markets' rally, with several timely investments in the
Hungarian stock market, in particular. The Fund also gained exposure to growth
12
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR EMERGING MARKETS FUND
ANNUAL INVESTMENT ADVISER'S REPORT (CONT'D)
- --------------------------------------------------------------------------------
in Eastern European economies via investments in stocks from more-developed
markets that have sales into the region. An example of such that performed well
for the Fund during the reporting period is Hartwall Oy, a Finnish beer brewery
with growing market share in Estonia, Latvia, Lithuania and Russia.
We remained uninvested in South Africa during the period, reflecting our
concerns over market valuations and the unstable state of the rand, the
country's currency.
<TABLE>
<S> <C>
Richard H. King Nicholas P.W. Horsley
Co-Portfolio Manager Co-Portfolio Manager
</TABLE>
13
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR EMERGING MARKETS FUND
ANNUAL INVESTMENT ADVISER'S REPORT (CONT'D)
- --------------------------------------------------------------------------------
GROWTH OF $10,000 INVESTED IN ADVISOR SHARES OF WARBURG PINCUS ADVISOR
EMERGING MARKETS FUND SINCE INCEPTION AS OF OCTOBER 31, 1996
The graph below illustrates the hypothetical investment of $10,000 in Advisor
Shares of Warburg Pincus Advisor Emerging Markets Fund (the 'Fund') from
December 30, 1994 (inception) to October 31, 1996, compared to the Lipper
Emerging Markets Fund Index* and the Morgan Stanley's Emerging Markets Free
Index ('MSCI')** for the same time period.
<TABLE>
<CAPTION>
MS-EMERGING AVERAGE ANNUAL TOTAL RETURNS
MARKETS FOR PERIODS ENDED 10/31/96
EMERGING GROWTH LIPEMKI FREE INDEX (ADVISOR SHARES)
--------------- ------- ----------- ----------------------------
<S> <C> <C> <C> <C>
Dec-94 10,000 10,000 10,000.00 1 year
Oct-95 11,329.03 9,249.53 9,241.98 9.20%
Oct-96 12,371.44 10,134.50 9,841.77
Since Inception
(12/30/94)
12.25%
</TABLE>
<TABLE>
<CAPTION>
FUND
------
<S> <C>
1 Year Total Return (9/30/95-9/30/96)........................................ 7.65%
Average Annual Total Return Since Inception (12/30/94-9/30/96)............... 14.82%
</TABLE>
Returns are historical and include changes in share price and reinvestment of
dividends and capital gains. Past performance cannot guarantee future results.
Returns and share price will fluctuate, and redemption value may be more or less
than original cost.
From time to time, the Fund's investment adviser and co-administrators may
waive some fees and/or reimburse some expenses, without which performance would
be lower. Waivers and/or reimbursements are subject to change.
- ------------
* The Lipper Emerging Markets Funds Index is an equal weighted index of the 30
largest mutual funds within the emerging markets objective. The emerging
markets objective is defined as Funds which seek long-term capital
appreciation by investing at least 65% of total assets in emerging market
equity securities, where 'Emerging Markets' is defined by a country's GNP per
capita or other economic measures.
** The Morgan Stanley Emerging Markets Free Index is a market-capitalization
weighted index of emerging market countries determined by Morgan Stanley. The
index includes only those countries open to non-local investors.
14
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR POST-VENTURE CAPITAL FUND
ANNUAL INVESTMENT ADVISER'S REPORT
- --------------------------------------------------------------------------------
Dear Shareholder: December 11, 1996
The objective of Warburg Pincus Advisor Post-Venture Capital Fund (the
'Fund') is long-term growth of capital. The Fund pursues its objective by
investing primarily in equity securities of companies deemed to be in their
post-venture-capital stage of development.
For the 12 months ended October 31, 1996, the Fund gained 49.16%, vs. gains
of 16.94% for the Lipper Growth Funds Index and 13.33% for the Russell 2000
Growth Index.
The Fund's strong performance vs. its benchmark is attributable to timely
stock selection, particularly in several of its more heavily weighted sectors.
These include computers and electronics (24.7% and 11.6% of the Fund's net
assets, respectively, as of October 31), areas that contributed significantly to
the Fund's returns despite the sharp correction in technology stocks in June and
July. These companies have traditionally been major recipients of
venture-capital financing, and this, coupled with their collectively impressive
(albeit often volatile) long-term share-price performance, makes it likely that
the stocks will remain a significant portion of the Fund going forward.
Business-services stocks (9.6% of the Fund's net assets as of October 31)
also demonstrated strong gains for the Fund. We view the group's prospects very
favorably, since these companies are immediate beneficiaries of Corporate
America's sweeping and ongoing moves toward downsizing and outsourcing. Such
cost-cutting efforts on the part of U.S. businesses are likely, if anything, to
intensify over time, and the Fund's holdings include companies that we believe
stand to benefit most from this trend.
Smaller areas of concentration for the Fund, but areas that also boosted its
performance, included financial services, retail and oil services. Stocks that
weighed on its performance were its health-care and pharmaceutical holdings,
many of which suffered due to investor concerns over pricing and margin
pressures. Their near-term weakness aside, we believe that these areas represent
vast opportunities for investment, given the favorable demographics supporting
demand for healthcare and venture-backed firms' typical leading role in the
development of new products and services. Accordingly, these stocks will likely
remain well-represented in the Fund in the future.
More generally, we continue to be encouraged by the Fund's relative strength
against broad-market measures, and believe that it illustrates the investment
15
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR POST-VENTURE CAPITAL FUND
ANNUAL INVESTMENT ADVISER'S REPORT (CONT'D)
- --------------------------------------------------------------------------------
potential of post-venture companies collectively. (We define these companies as
those that have received venture-capital financing either during the early
stages of their existence or in the early stages of the development of a new
product or service, or that have received such financing as part of a
restructuring or recapitalization.) We would caution investors, however, that
investing in these securities entails potential risks as well as rewards.
Because of the nature of the Fund's holdings and certain strategies it may use,
an investment in the Fund should be considered only for the aggressive portion
of an investor's portfolio and may not be appropriate for all investors.
Investors should review the Fund's Prospectus carefully before purchase.
<TABLE>
<S> <C>
Elizabeth B. Dater Stephen J. Lurito
Co-Portfolio Manager Co-Portfolio Manager
</TABLE>
16
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR POST-VENTURE CAPITAL FUND
ANNUAL INVESTMENT ADVISER'S REPORT (CONT'D)
- --------------------------------------------------------------------------------
GROWTH OF $10,000 INVESTED IN ADVISOR SHARES OF WARBURG PINCUS ADVISOR
POST-VENTURE CAPITAL FUND SINCE INCEPTION AS OF OCTOBER 31, 1996
The graph below illustrates the hypothetical investment of $10,000 in Advisor
Shares of Warburg Pincus Advisor Post-Venture Capital Fund (the 'Fund') from
September 29, 1995 (inception) to October 31, 1996, compared to the Lipper
Growth Funds Index* and the Russell 2000 Growth Index ('Russell')** for the same
time period.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
RUSSELL 2000 FOR PERIODS ENDED 10/31/96
POST VENTURE LIPGRI GROWTH (ADVISOR SHARES)
------------ ------ ------------ ----------------------------
<S> <C> <C> <C> <C>
Sep-95 10,000 10,000 10,000 1 year
Oct-95 10,669.33 9,867.30 9,508.20 49.16%
Oct-96 15,914.09 11,538.81 10,775.63
Since Inception
(9/29/95)
53.10%
</TABLE>
/<TABLE>
<CAPTION>
FUND
------
<S> <C>
1 Year Total Return (9/30/95-9/30/96)........................................ 64.54%
Average Annual Total Return Since Inception (9/29/95-9/30/96)................ 64.03%
</TABLE>
Returns are historical and include changes in share price and reinvestment of
dividends and capital gains. Past performance cannot guarantee future results.
Returns and share price will fluctuate, and redemption value may be more or less
than original cost.
From time to time, the Fund's investment adviser and co-administrators may
waive some fees and/or reimburse some expenses, without which performance would
be lower. Waivers and/or reimbursements are subject to change.
- ------------
* The Lipper Growth Funds Index is an equal weighted index of the 30 largest
Mutual funds within the growth objective. It is adjusted for the reinvestment
of capital gains distributions and income dividends.
** The Russell 2000 Growth Index is an unmanaged index of securities in the
Russell 2000 Index with a greater than average growth orientation. The Rusell
2000 Index is a measure of small capitalization stocks.
17
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR JAPAN GROWTH FUND
ANNUAL INVESTMENT ADVISER'S REPORT
- --------------------------------------------------------------------------------
Dear Shareholder: December 11, 1996
The objective of Warburg Pincus Advisor Japan Growth Fund (the 'Fund') is
long-term growth of capital. The Fund is a non-diversified investment company
that pursues its objective by investing primarily in equity securities of
Japanese issuers deemed to represent attractive opportunities for growth.
For the 10 months ended October 31, 1996 (the Fund's inception date was
December 29, 1995), the Fund had a total return of -1.70%, vs. a -7.19%
total return for the Lipper Japanese Funds Average and a -10.83% total return
for the Tokyo Stock Exchange Index.
Though the Fund's performance was a strong one in relative terms, the period
was clearly a disappointing one for both the Fund and the Japanese stock market.
Collectively, Japanese stocks had displayed solid gains through the first half
of the period, rising on strengthening corporate profits and on signs that
economic recovery was well under way (evidenced most visibly by a 12.7%
annualized rise in gross domestic product in the first quarter). But weakness in
the following months, particularly in July and August, negated these gains.
Weighing on share prices were fears that the economy might be faltering and,
alternately, that signs of strength might compel the Bank of Japan to raise
interest rates. Also taking a toll on investor sentiment was the lingering
weakness in the Japanese banking system and, at the end of the period, concerns
that the new government might slow the pace of economic reform.
Its near-term weakness aside, we remain positive on the prospects for the
Japanese stock market. A close reading of the data indicates that Japan's
economic recovery remains intact, and we believe that the recovery will
continue, supported by the Bank of Japan's still-accommodative monetary policy
and, over the longer term, by the ongoing restructuring of Japanese industry.
This stands to lead to proportionately higher corporate earnings, which have
already shown substantial improvement from year-earlier levels. As well,
Japanese pension funds continue to represent a considerable source of potential
investment, holding several trillion in yen on the sidelines that is likely, at
some point, to make its way into the equity market. The combination of improved
fundamentals and increased demand should, we believe, translate into much higher
share prices over time.
We remain particularly optimistic on the outlook for our specific holdings.
By sector, the Fund's greatest concentration lies in companies from the
consumption and capital-spending areas, which stand to be the largest
beneficiaries of
18
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR JAPAN GROWTH FUND
ANNUAL INVESTMENT ADVISER'S REPORT (CONT'D)
- --------------------------------------------------------------------------------
economic recovery. Many companies from these areas are also benefiting from
their ongoing restructuring efforts and from the steady, albeit slow,
deregulation of the Japanese economy. Hence they should, we believe, see
superior stock-price performance vs. the broader Japanese market going forward.
On this note, we are encouraged by the Fund's relative strength during the
reporting period, though, obviously, we are dissatisfied in absolute terms.
We will continue to pursue a defensive hedging strategy in managing the Fund
in an effort to minimize currency risk. During the reporting period, we hedged
much of the Fund's yen exposure, reflecting our view that the currency was
overvalued and likely to weaken. This had a favorable impact on the Fund's
performance, given the currency's depreciation against the U.S. dollar.
<TABLE>
<S> <C>
P. Nicholas Edwards
Portfolio Manager
</TABLE>
19
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR JAPAN GROWTH FUND
ANNUAL INVESTMENT ADVISER'S REPORT (CONT'D)
- --------------------------------------------------------------------------------
GROWTH OF $10,000 INVESTED IN ADVISOR SHARES OF WARBURG PINCUS ADVISOR
JAPAN GROWTH FUND SINCE INCEPTION AS OF OCTOBER 31, 1996
The graph below illustrates the hypothetical investment of $10,000 in Advisor
Shares of Warburg Pincus Advisor Japan Growth Fund (the 'Fund') from December
29, 1995 (inception) to October 31, 1996, compared to the Lipper Japanese Funds
Average* and the Tokyo Stock Exchange Index ('TOPIX')** for the same time
period.
<TABLE>
<CAPTION>
LIPPER TOKYO STOCK AVERAGE ANNUAL TOTAL RETURNS
JAPANESE EXCHANGE FOR PERIODS ENDED 10/31/96
JAPAN GROWTH FUNDS AVERAGE INDEX (US $) (ADVISOR SHARES)
------------ ------------- ------------ ----------------------------
<S> <C> <C> <C> <C>
Dec-95 10,000 10,000 10,000 Since Inception
Oct-96 9,830.00 9,291.42 8,913.58 (12/29/95)
-1.70%+
</TABLE>
<TABLE>
<CAPTION>
FUND
------
<S> <C>
Aggregate Total Return Since Inception (12/29/95-9/30/96).................... 3.50%+
</TABLE>
Returns are historical and include changes in share price and reinvestment of
dividends and capital gains. Past performance cannot guarantee future results.
Returns and share price will fluctuate, and redemption value may be more or less
than original cost.
From time to time, the Fund's investment adviser and co-administrators may
waive some fees and/or reimburse some expenses, without which performance would
be lower. Waivers and/or reimbursements are subject to change.
- ------------
* The Lipper Japanese Funds Average is an arithmetic average of all funds
tracked by Lipper Analytical Services, Inc. that concentrate its investments
in equity securities of Japanese companies.
** The Tokyo Stock Exchange Index is a capitalization weighted index comprising
of all stocks listed in the first section of the Tokyo Stock Exchange.
+ Non-annualized
20
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR SMALL COMPANY VALUE FUND
ANNUAL INVESTMENT ADVISER'S REPORT
- --------------------------------------------------------------------------------
Dear Shareholder: December 11, 1996
The objective of Warburg Pincus Advisor Small Company Value Fund (the 'Fund')
is long-term capital appreciation. The Fund invests primarily in equity
securities of small-capitalization companies (i.e., those with stock-market
capitalizations of $1 billion or less at the time of initial purchase) that are
believed to be undervalued.
For the 10 months ended October 31, 1996 (the Fund's inception date was
December 29, 1995), the Fund gained 44.60%, vs. a gain of 9.03% for the Russell
2000 Index.
The Fund's outperformance of its benchmark index reflects timely stock
selection across a wide range of industries in what is, we believe, a very
inefficiently priced segment of the market. Indeed, most of the stocks from our
investment universe are sufficiently small to attract little in the way of
analyst coverage or investor attention, and the resulting potential to identify
undervalued stocks is considerable. Our thorough, bottom-up research process
aims to find such securities before they reach the attention of the broader
investment community, and the Fund's performance through the reporting period
illustrates the potential merits of such an approach.
Stocks chosen for the Fund can be divided into two general categories. The
larger group, which we term 'core value,' consists of companies with stable cash
flows, earnings and asset values that the market has for some reason failed to
recognize (typically due to a company's small market capitalization and the
resulting lack of investor awareness). The smaller group comprises companies in
which a significant improvement in operations is under way or planned that
stands to lead to markedly higher earnings or cash flow. We sell a stock when it
meets our target price or if there is an unforeseen deterioration in its
fundamentals.
We maintain a relatively focused portfolio, limiting the Fund's holdings to a
targeted range of 45 to 55 stocks and taking larger positions (3% or 4% of
assets) in those stocks in which we have greatest conviction. Through the
reporting period, the Fund benefited from the strong and, in several cases,
rapid appreciation of a good number of its larger holdings, and this explains
much of the Fund's sizable outperformance for the period. Particularly strong
performers for the Fund during the period included apparel retailer Wet Seal
(sold by the Fund after it reached our target price) and electronics company
Larson Davis.
21
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR SMALL COMPANY VALUE FUND
ANNUAL INVESTMENT ADVISER'S REPORT (CONT'D)
- --------------------------------------------------------------------------------
Looking ahead, we believe that there remain many attractive investment
opportunities in the downbeaten portion of the small-cap market. We will
continue to strive to identify those with the best prospects for long-term
capital appreciation.
<TABLE>
<S> <C>
George U. Wyper Kyle F. Frey
Portfolio Manager Associate Portfolio Manager
</TABLE>
22
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR SMALL COMPANY VALUE FUND
ANNUAL INVESTMENT ADVISER'S REPORT (CONT'D)
- --------------------------------------------------------------------------------
GROWTH OF $10,000 INVESTED IN ADVISOR SHARES OF WARBURG PINCUS ADVISOR
SMALL COMPANY VALUE FUND SINCE INCEPTION AS OF OCTOBER 31, 1996
The graph below illustrates the hypothetical investment of $10,000 in Advisor
Shares of Warburg Pincus Advisor Small Company Value Fund (the 'Fund') from
December 29, 1995 (inception) to October 31, 1996, compared to the Russell 2000
Index (Russell)* for the same time period.
AVERAGE ANNUAL TOTAL RETURNS
SMALL CO. FOR PERIODS ENDED 10/31/96
VALUE RUSSELL 2000 (ADVISOR SHARES)
--------- ------------ ----------------------------
[S] [C] [C] [C]
Dec-95 10,000 10,000 Since Inception
Oct-96 14,460.00 10,903.15 (12/29/95)
44.60%+
<TABLE>
<CAPTION>
FUND
-------
<S> <C>
Aggregate Total Return Since Inception (12/29/95-9/30/96).................. 40.90%+
</TABLE>
Returns are historical and include changes in share price and reinvestment of
dividends and capital gains. Past performance cannot guarantee future results.
Returns and share price will fluctuate, and redemption value may be more or less
than original cost.
From time to time, the Fund's investment adviser and co-administrators may
waive some fees and/or reimburse some expenses, without which performance would
be lower. Waivers and/or reimbursements are subject to change.
- ------------
* The Russell 2000 Index is an unmanaged index of the smallest 2,000 securities
in the Russell 3000 Index. The Russell 3000 Index is an index of the 3,000
largest U.S. securities, as determined by total market capitalization.
+ Non-annualized
23
<PAGE>
<PAGE>
WARBURG PINCUS ADVISOR GLOBAL POST-VENTURE CAPITAL FUND
ANNUAL INVESTMENT ADVISER'S REPORT
- --------------------------------------------------------------------------------
Dear Shareholder: December 11, 1996
The objective of Warburg Pincus Advisor Global Post-Venture Capital Fund (the
'Fund') is long-term growth of capital. The Fund invests primarily in equity
securities of U.S. and foreign issuers considered to be in their post-venture-
capital stage of development.
For the one month ended October 31, 1996 (the Fund's inception date was
September 30, 1996), the Fund had a total return of - 1.50%*, vs. a total
return of 0.03% for the Lipper Global Funds Index.
Although the Fund has just started and is small in size, we think it
represents an attractive way for investors to participate in the growth
potential of venture-backed companies on a global basis. Foreign companies
backed by venture capital are listed on markets in the U.S. such as the NASDAQ,
and on relatively new markets like the EASDAQ (in Europe) and the JASDAQ (in
Japan). We believe that venture-capital participation in a company's capital
structure can lead to revenue and/or earnings growth rates above those of older,
public companies such as those in the Dow Jones Industrial Average, the S&P 500
Index or the Morgan Stanley Capital International Europe, Australasia and Far
East ('EAFE') Index.
Because of the nature of the Fund's holdings and certain strategies it may
use, however, an investment in the Fund should be considered only for the
aggressive portion of an investor's portfolio and may not be appropriate for all
investors. Investors should review the Fund's Prospectus carefully before
purchase.
Elizabeth B. Dater
Portfolio Manager
- ------------
* Returns are historical and include changes in share price and reinvestment of
dividends and capital gains. Past performance cannot guarantee future results.
Returns and share price will fluctuate, and redemption value may be more or
less than original cost.
From time to time, the Fund's investment adviser and co-administrators may
waive some fees and/or reimburse some expenses, without which performance
would be lower. Waivers and/or reimbursements are subject to change.
24
<PAGE>
<PAGE>
WARBURG PINCUS CAPITAL APPRECIATION FUND
STATEMENT OF NET ASSETS
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- ------------
<S> <C> <C>
COMMON STOCK (92.0%)
Aerospace & Defense (8.6%)
Lockheed Martin Corp. 85,000 $ 7,618,125
Loral Space & Communications, Ltd. `D' 496,800 7,886,700
McDonnell Douglas Corp. 110,000 5,995,000
Raytheon Co. 125,000 6,156,250
Sundstrand Corp. 62,100 2,499,525
Tracor, Inc. `D' 305,000 6,938,750
------------
37,094,350
------------
Agriculture (2.9%)
Monsanto Co. 312,500 12,382,813
------------
Banks & Savings & Loans (12.1%)
BankAmerica Corp. 150,000 13,725,000
Bank of New York Co., Inc. 100,000 3,312,500
Citicorp 100,000 9,900,000
Eagle Financial Corp. 66,000 1,765,500
Northern Trust Corp. 125,000 8,656,250
Wells Fargo & Co. 55,033 14,700,690
------------
52,059,940
------------
Business Services (1.5%)
First Data Corp. 60,000 4,785,000
Manpower, Inc. 3,500 99,312
Union Corp. `D' 67,400 1,482,800
------------
6,367,112
------------
Chemicals (8.7%)
Avery-Dennison Corp. 200,000 13,175,000
Du Pont (E.I.), de Nemours & Co. 90,000 8,347,500
Grace (W.R.) & Co. `D' 180,000 9,540,000
Hercules, Inc. 133,600 6,362,700
------------
37,425,200
------------
Communications & Media (4.6%)
Evergreen Media Corp. Class A `D' 60,000 1,620,000
Gannett Co., Inc. 50,000 3,793,750
Heritage Media Corp. Class A `D' 280,000 4,270,000
LIN Television Corp. `D' 96,200 3,643,575
Metromedia International Group, Inc. `D' 378,200 3,734,725
Viacom, Inc. Class B `D' 85,000 2,773,125
------------
19,835,175
------------
</TABLE>
See Accompanying Notes to Financial Statements.
25
<PAGE>
<PAGE>
WARBURG PINCUS CAPITAL APPRECIATION FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- ------------
<S> <C> <C>
COMMON STOCK (CONT'D)
Computers (2.8%)
Compaq Computer Corp. `D' 100,000 $ 6,962,500
Evans & Sutherland Computer Corp. `D' 30,000 630,000
Parametric Technology Corp. `D' 60,000 2,932,500
Teradyne, Inc. `D' 100,000 1,587,500
------------
12,112,500
------------
Conglomerates (2.6%)
Oglebay Norton Co. 123,900 5,389,650
Thermo Electron Corp. `D' 156,600 5,715,900
------------
11,105,550
------------
Consumer Durables (1.6%)
General Motors Corp. 125,000 6,734,375
------------
Consumer Non-Durables (2.8%)
Gillette Co. 9,200 687,700
Standex International Corp. 367,100 11,288,325
------------
11,976,025
------------
Consumer Services (0.5%)
Kinder-Care Learning Centers, Inc. `D' 120,000 2,370,000
------------
Electronics (0.7%)
Synopsys, Inc. `D' 70,000 3,150,000
------------
Energy (8.6%)
Anadarko Petroleum Corp. 90,400 5,751,700
Apache Corp. 150,000 5,325,000
Belco Oil & Gas Corp. `D' 158,000 3,930,250
Burlington Resources, Inc. 120,000 6,045,000
Mesa, Inc. `D' 600,000 2,775,000
San Juan Basin Royalty Trust 550,000 3,850,000
Texas Meridian Resources Corp. `D' 150,000 2,700,000
Union Pacific Resources Group, Inc. 75,000 2,062,500
United Meridian Corp. Series A `D' 105,000 4,948,125
------------
37,387,575
------------
</TABLE>
See Accompanying Notes to Financial Statements.
26
<PAGE>
<PAGE>
WARBURG PINCUS CAPITAL APPRECIATION FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- ------------
<S> <C> <C>
COMMON STOCK (CONT'D)
Financial Services (9.5%)
Allmerica Financial Corp. 100,000 $ 3,037,500
Allmerica Property & Casualty Companies, Inc. 15,000 414,375
Federal Home Loan Mortgage Corp. 40,000 4,040,000
Household International, Inc. 40,000 3,540,000
Legg Mason, Inc. 60,000 1,935,000
Leucadia National Corp. 135,000 3,189,375
Security Connecticut Corp. 168,200 5,382,400
Transport Holdings, Inc. Class A `D' 129,550 9,845,800
Travelers Group, Inc. 100,000 5,425,000
UNUM Corp. 50,000 3,143,750
Willis Lease Finance Corp. `D' 92,000 977,500
------------
40,930,700
------------
Food, Beverages & Tobacco (3.3%)
Coca-Cola Enterprises, Inc. 100,000 4,262,500
Pepsico, Inc. 300,000 8,887,500
Suiza Foods Corp. `D' 65,000 1,121,250
------------
14,271,250
------------
Healthcare (4.3%)
Becton Dickinson & Co. 60,000 2,610,000
Healthcare COMPARE Corp. `D' 60,000 2,640,000
Health Management Associates, Inc. Class A `D' 160,000 3,520,000
Mallinckrodt, Inc. 100,000 4,350,000
St. Jude Medical, Inc. `D' 135,000 5,332,500
------------
18,452,500
------------
Leisure & Entertainment (0.8%)
Disney (Walt) Co. 50,000 3,293,750
------------
Lodging & Restaurants (2.7%)
McDonald's Corp. 265,000 11,759,375
------------
Metals & Mining (2.0%)
Allegheny Teledyne, Inc. 400,000 8,550,000
Century Aluminum Co. 20,000 270,000
------------
8,820,000
------------
Oil Services (0.3%)
Input/Output, Inc. `D' 50,000 1,487,500
------------
</TABLE>
See Accompanying Notes to Financial Statements.
27
<PAGE>
<PAGE>
WARBURG PINCUS CAPITAL APPRECIATION FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- ------------
<S> <C> <C>
COMMON STOCK (CONT'D)
Pharmaceuticals (2.8%)
Sandoz Ltd. Sponsored ADR 100,000 $ 5,803,500
Warner-Lambert Co. 100,000 6,362,500
------------
12,166,000
------------
Publishing (3.6%)
Belo (A.H.) Corp. Series A 181,100 7,062,900
Harcourt General, Inc. 120,000 5,970,000
Wiley (John) & Sons, Inc. Class A 83,600 2,560,250
------------
15,593,150
------------
Retail (2.6%)
Carr-Gottstein Foods Co. `D' 191,000 787,875
CUC International, Inc. `D' 210,000 5,145,000
Rite Aid Corp. 150,000 5,100,000
------------
11,032,875
------------
Telecommunications & Equipment (1.2%)
Tellabs, Inc. `D' 30,000 2,553,750
WorldCom, Inc. `D' 100,000 2,437,500
------------
4,991,250
------------
Transportation (0.9%)
Norfolk Southern Corp. 45,000 4,010,625
------------
TOTAL COMMON STOCK (Cost $332,234,495) 396,809,590
------------
</TABLE>
See Accompanying Notes to Financial Statements.
28
<PAGE>
<PAGE>
WARBURG PINCUS CAPITAL APPRECIATION FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- ------------
<S> <C> <C>
PREFERRED STOCK (0.0%)
Healthcare (0.0%)
Fresenius National Medical Inc. Series D `D' (Cost
$18,553) 90,000 $ 13,500
------------
<CAPTION>
PAR
---------
<S> <C> <C>
SHORT-TERM INVESTMENTS (7.0%)
Repurchase agreement with State Street Bank & Trust
Company dated 10/31/96 at 5.51% to be repurchased at
$30,043,598 on 11/01/96. (Collateralized by $30,300,000
U.S. Treasury Note 6.125%, due 03/31/98. Market value of
collateral is $30,640,875.) (Cost $30,039,000) $30,039,000 30,039,000
------------
TOTAL INVESTMENTS AT VALUE (99.0%) (Cost $362,292,048*) 426,862,090
OTHER ASSETS IN EXCESS OF LIABILITIES (1.0%) 4,284,929
------------
NET ASSETS (100.0%) (applicable to 22,715,578 Common Shares and
1,322,367 Advisor Shares) $431,147,019
------------
------------
NET ASSET VALUE, offering and redemption price per Common Share
($407,706,869[div]22,715,578) $17.95
------
------
NET ASSET VALUE, offering and redemption price per Advisor Share
($23,440,150[div]1,322,367) $17.73
------
------
</TABLE>
INVESTMENT ABBREVIATIONS
ADR = American Depository Receipt
- --------------------------------------------------------------------------------
`D' Non-income producing security.
* Cost for Federal income tax purposes is $363,114,364.
See Accompanying Notes to Financial Statements.
29
<PAGE>
<PAGE>
WARBURG PINCUS EMERGING GROWTH FUND
STATEMENT OF NET ASSETS
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- --------------
<S> <C> <C>
COMMON STOCK (95.1%)
Aerospace & Defense (1.8%)
Gulfstream Aerospace Corp. `D' 304,000 $ 7,182,000
Tracor, Inc. `D' 844,000 19,201,000
--------------
26,383,000
--------------
Banks & Savings & Loans (1.8%)
Banco Latinoamericano de Exportaciones, SA Class E 263,900 13,788,775
Cullen Frost Bankers, Inc. 411,400 12,367,712
--------------
26,156,487
--------------
Business Services (16.5%)
American Management Systems, Inc. `D' 648,050 20,494,581
BISYS Group, Inc. 309,500 11,528,875
Catalina Marketing Corp. `D' 418,544 21,293,426
CDI Corp. `D' 460,071 12,899,452
Corporate Express, Inc. 391,000 12,756,375
Daisytek International Corp. `D' 376,046 14,383,760
DecisionOne Holdings Corp. 705,700 10,056,225
Norrell Corp. 543,188 13,579,700
On Assignment, Inc. `D' 352,800 10,848,600
Outdoor Systems, Inc. `D' 288,000 12,888,000
Pittston Brink's Group 771,200 21,979,200
QuickResponse Services, Inc. `D' 417,267 15,491,037
Reynolds & Reynolds Co., Class A 610,000 16,088,750
Robert Half International, Inc. 538,200 21,595,275
Sitel Corp. `D' 89,000 1,757,750
Staffing Resources, Inc. `D' # 91,000 1,001,000
Universal Outdoor Holdings, Inc. `D' 345,500 10,149,063
WPP Group Plc ADR 365,000 13,459,375
--------------
242,250,444
--------------
Capital Equipment (0.1%)
Roper Industries, Inc. 22,000 929,500
--------------
Communications & Media (3.3%)
Central European Media Enterprises Ltd. Class A `D' 743,553 20,819,484
Harte-Hanks Communications, Inc. `D' 547,500 14,166,563
Heritage Media Corp. Class A 500,000 7,625,000
Metro Networks, Inc. `D' 101,700 2,059,425
Univision Communications, Inc. `D' 90,500 3,054,375
--------------
47,724,847
--------------
</TABLE>
See Accompanying Notes to Financial Statements.
30
<PAGE>
<PAGE>
WARBURG PINCUS EMERGING GROWTH FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- --------------
<S> <C> <C>
COMMON STOCK (CONT'D)
Computers (13.9%)
Auspex Systems, Inc. `D' 758,000 $ 7,769,500
Baan Co. NV `D' 410,000 15,170,000
BMC Software, Inc.`D' 180,000 14,940,000
Citrix Systems, Inc. `D' 523,254 28,909,783
Clarify, Inc. `D' 588,200 28,380,650
Cognex Corp. `D' 464,600 5,981,725
Harbinger Corp. `D' 469,500 12,676,500
Informix Corp. `D' 650,000 14,421,875
McAfee Associates, Inc. `D' 302,500 13,763,750
National Instruments Corp. `D' 506,545 14,436,533
Pure Atria Corp. `D' 639,030 17,413,568
Rational Software Corp. `D' 785,000 30,124,375
--------------
203,988,259
--------------
Consumer Non-Durables (2.8%)
Alberto Culver Co. Class A 137,800 5,477,550
Central Garden & Pet Co. `D' 596,900 14,101,762
Sola International, Inc. `D' 616,900 22,285,513
--------------
41,864,825
--------------
Consumer Services (2.2%)
DeVRY, Inc. `D' 314,474 15,684,390
ITT Educational Services, Inc. `D' 460,300 16,743,413
--------------
32,427,803
--------------
Electronics (11.1%)
Altera Corp. `D' 150,000 9,300,000
Burr-Brown Corp. `D' 676,577 14,377,261
Epic Design Technology, Inc. `D' 647,200 15,856,400
Glenayre Technologies, Inc. `D' 742,862 19,128,697
Maxim Integrated Products, Inc. `D' 669,000 23,415,000
Methode Electronics, Inc. Class A 882,103 17,201,009
Microchip Technology, Inc. 397,700 14,416,625
Synopsys, Inc. `D' 882,600 39,717,000
Xilinx, Inc. `D' 287,000 9,399,250
--------------
162,811,242
--------------
</TABLE>
See Accompanying Notes to Financial Statements.
31
<PAGE>
<PAGE>
WARBURG PINCUS EMERGING GROWTH FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- --------------
<S> <C> <C>
COMMON STOCK (CONT'D)
Energy (2.9%)
Barrett Resources Corp. `D' 403,100 $ 15,468,962
Brown (Tom), Inc. `D' 782,611 14,771,782
Texas Meridian Resources Corp. `D' 710,054 12,780,972
--------------
43,021,716
--------------
Environmental Services (3.1%)
Allied Waste Industries, Inc. `D' 1,729,303 15,671,808
USA Waste Services, Inc. `D' 946,506 30,288,192
--------------
45,960,000
--------------
Financial Services (4.4%)
City National Corp. 828,000 14,490,000
Price (T. Rowe) Associates, Inc. 450,000 15,356,250
Transaction Systems Architects, Inc. Class A `D' 846,300 35,121,450
--------------
64,967,700
--------------
Healthcare (5.6%)
Ballard Medical Products 556,286 9,804,540
EmCare Holdings, Inc. `D' 534,782 13,369,550
IDX Systems Corp. 325,067 9,589,477
InControl, Inc. `D' 711,100 5,777,688
Lincare Holdings, Inc. `D' 518,000 19,425,000
PhyMatrix, Inc. `D' 126,400 2,101,400
Physician Reliance Network, Inc. `D' 1,026,400 6,030,100
Trex Medical Corp. `D' # 40,000 669,750
Vivra, Inc. 475,000 15,140,625
--------------
81,908,130
--------------
Industrial Mfg. & Processing (1.5%)
Waters Corp. 686,300 21,275,300
--------------
Lodging & Restaurants (1.6%)
Doubletree Corp. `D' 352,076 14,281,083
Renaissance Hotel Group NV 540,409 9,930,015
--------------
24,211,098
--------------
Office Equipment & Supplies (2.1%)
Miller (Herman), Inc. 345,000 14,878,125
Viking Office Products, Inc. `D' 559,000 16,280,875
--------------
31,159,000
--------------
</TABLE>
See Accompanying Notes to Financial Statements.
32
<PAGE>
<PAGE>
WARBURG PINCUS EMERGING GROWTH FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- --------------
<S> <C> <C>
COMMON STOCK (CONT'D)
Oil Services (5.3%)
Global Industries, Inc. `D' 639,800 $ 11,516,400
Input/Output, Inc. `D' 917,300 27,289,675
Nabors Industries, Inc. `D' 902,000 14,995,750
Petroleum Geo. Services ADR `D' 672,369 23,028,638
--------------
76,830,463
--------------
Pharmaceuticals (2.8%)
Gilead Sciences, Inc. `D' 756,465 17,682,369
Ligand Pharmaceuticals, Inc. Class B `D' 925,782 11,456,552
Regeneron Pharmaceuticals, Inc. `D' 597,300 11,348,700
Somatix Therapy Corp. `D' 170,940 566,239
--------------
41,053,860
--------------
Publishing (0.5%)
Wiley (John) & Sons, Inc. Class A 258,300 7,910,437
--------------
Real Estate (1.7%)
NHP, Inc. `D' 779,002 12,853,533
Rouse Co. 457,500 11,609,063
--------------
24,462,596
--------------
Retail (4.7%)
Borders Group, Inc. `D' 672,500 21,183,750
Neiman Marcus Group, Inc.`D' 200,000 6,525,000
Payless ShoeSource, Inc. `D' 465,000 15,751,875
PETsMART, Inc. `D' 933,800 25,212,600
--------------
68,673,225
--------------
Telecommunications & Equipment (4.4%)
McLeod, Inc. `D' 435,200 14,144,000
MFS Communications Co., Inc. `D' 618,777 31,016,197
Nexus Telecommunications Ltd. `D' # 375,000 1,265,625
Paging Network, Inc. `D' 676,300 11,581,638
Premisys Communications, Inc.`D' 151,000 7,550,000
--------------
65,557,460
--------------
Transportation (1.0%)
Mark VII, Inc. `D' 540,069 14,109,303
--------------
TOTAL COMMON STOCK (Cost $1,131,607,457) 1,395,636,695
--------------
PREFERRED STOCK (0.4%)
Computers (0.1%)
Focal, Inc., Series E `D' # 1,149,425 2,000,000
--------------
</TABLE>
See Accompanying Notes to Financial Statements.
33
<PAGE>
<PAGE>
WARBURG PINCUS EMERGING GROWTH FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- --------------
<S> <C> <C>
PREFERRED STOCK (CONT'D)
Pharmaceuticals (0.1%)
Somatix Therapy Corp. Series A-1 Convertible `D' # 60,000 $ 1,265,625
Somatix Therapy Corp. Series A-2 Convertible `D' # 5,285 111,480
--------------
1,377,105
--------------
Miscellaneous (0.2%)
Opal Concepts Inc., Series B `D' # 2,000 2,000,000
--------------
TOTAL PREFERRED STOCK (Cost $5,500,001) 5,377,105
--------------
WARRANTS (0.0%)
Computers
Stratasys, Inc. 11/03/98 `D' # 21,428 0
--------------
Pharmaceuticals
Somatix Therapy Corp. 06/28/98 `D' # 210,000 0
--------------
Telecommunications & Equipment
Nexus Telecommunications Ltd. 11/28/97 # 375,000 234,375
--------------
TOTAL WARRANTS (Cost $0) 234,375
--------------
<CAPTION>
SHORT-TERM INVESTMENTS (4.6%) PAR
---------
<S> <C> <C>
Repurchase agreement with State Street Bank & Trust Company
dated 10/31/96 at 5.51% to be repurchased at $67,301,299 on
11/01/96. (Collateralized by $67,875,000 U.S. Treasury Note
6.125%, due 03/31/98. Market value of collateral is
$68,638,594.) (Cost $67,291,000) $67,291,000 67,291,000
--------------
TOTAL INVESTMENTS AT VALUE (100.1%) (Cost $1,204,398,458*) 1,468,539,175
LIABILITIES IN EXCESS OF OTHER ASSETS (0.1%) (1,159,063)
--------------
NET ASSETS (100.0%) (applicable to 33,681,465 Common Shares
and 11,338,414 Advisor Shares) $1,467,380,112
--------------
--------------
NET ASSET VALUE, offering and redemption price per Common Share
($1,104,684,360[div]33,681,465) $32.80
------
------
NET ASSET VALUE, offering and redemption price per Advisor Share
($362,695,752[div]11,338,414) $31.99
------
------
</TABLE>
INVESTMENT ABBREVIATIONS
ADR = American Depository Receipt
- --------------------------------------------------------------------------------
`D' Non-income producing security.
# Restricted security.
* Cost for Federal income tax purposes is $1,208,413,210.
See Accompanying Notes to Financial Statements.
34
<PAGE>
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
STATEMENT OF NET ASSETS
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
---------- ------------
<S> <C> <C>
COMMON STOCK (94.1%)
Argentina (2.8%)
Banco de Galicia & Buenos Aires SA 513,922 $ 2,361,735
Banco de Galicia & Buenos Aires SA ADR 149,765 2,714,491
Banco Frances del Rio de la Plata SA 586,615 5,139,048
Banco Frances del Rio de la Plata SA ADR 787,520 20,672,400
Telefonica de Argentina SA ADR 1,180,200 27,439,650
YPF SA ADR 1,659,000 37,742,250
------------
96,069,574
------------
Australia (4.3%)
Boral Ltd. 5,793,998 14,412,616
Lend Lease Corp., Ltd. 2,197,700 37,240,374
Niugini Mining Ltd. `D' 1,731,250 4,594,512
Oil Search Ltd. 19,274,500 29,011,592
Orogen Minerals Ltd. ADR `D' 212,000 3,357,444
Pasminco Ltd. 7,766,600 12,059,293
Qantas Airways Ltd. 8,755,600 12,762,583
Qantas Airways Ltd. ADR 270,300 3,944,218
Reinsurance Australia Corp., Ltd. 9,523,400 28,517,974
------------
145,900,606
------------
Austria (2.3%)
Boehler-Uddeholm AG 330,880 24,763,955
V.A. Technologie AG 391,624 54,795,733
------------
79,559,688
------------
Belgium (0.3%)
Barco Industries N.V. 67,850 11,163,262
------------
Brazil (1.0%)
Panamerican Beverages, Inc. Class A 749,200 32,683,850
------------
Canada (1.0%)
Alcan Aluminium Ltd. 1,060,800 34,873,800
------------
Chile (0.4%)
Enersis SA ADR 433,000 12,719,375
------------
China (1.4%)
Cheung Kong Infrastructure Holdings `D' 4,271,400 7,955,322
Guangshen Railway Co., Ltd. `D' 23,532,790 8,750,569
Guangshen Railway Co., Ltd. ADR `D' 887,417 16,528,142
Henderson China Holding Ltd. `D' 3,450,000 7,808,761
Jilin Chemical Industrial Co., Ltd. ADR 387,340 5,083,838
------------
46,126,632
------------
Denmark (0.9%)
International Service System AS Class B 1,108,610 31,464,806
------------
</TABLE>
See Accompanying Notes to Financial Statements.
35
<PAGE>
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
---------- ------------
<S> <C> <C>
COMMON STOCK (CONT'D)
Finland (1.7%)
Metra Oy Class A 300 $ 17,015
Metra Oy Class B 165,250 9,219,456
Metsa-Serla Class B 2,963,250 20,599,924
Valmet Corp. Class A 1,738,400 26,548,658
------------
56,385,053
------------
France (6.0%)
Assurances Generales de France 565,572 16,689,808
Axime (Ex Segin) 111,000 11,881,531
Cetelem 54,185 11,568,204
Compagnie Bancaire SA 71,960 7,181,637
Fives-Lille (Compagnie De) 84,060 7,616,097
Lagardere S.C.A. 1,564,687 49,449,523
Total Cie Franc Des Petroles Class B 716,705 56,085,931
Total Cie Franc Des Petroles SA ADR 49,005 1,911,195
Usinor Sacilor SA 2,725,050 40,447,545
------------
202,831,471
------------
Germany (2.1%)
Adidas AG 222,800 18,770,318
BASF AG 470,700 15,053,443
SGL Carbon AG 338,740 37,558,195
------------
71,381,956
------------
Hong Kong (4.0%)
Citic Pacific Ltd. 9,466,700 46,037,472
Hong Kong Land Holdings Ltd. ADR 12,119,200 27,025,816
Hong Kong Land Holdings Ltd. 1,246,600 13,899,590
HSBC Holdings PLC 862,002 17,559,568
HSBC Holdings PLC (UK) 4,448 93,367
Jardine Matheson Holdings Ltd. 5,753,958 32,509,863
------------
137,125,676
------------
India (1.8%)
Associated Cement Companies Ltd. 41,120 1,776,851
Bharat Petroleum Corp., Ltd. 209,300 1,652,991
Hindalco Industries Ltd. 597,225 9,922,812
Hindalco Industries Ltd. GDR 324,300 5,960,634
India Cements Ltd. 99,650 281,577
Reliance Industries Ltd. 2,368,250 13,551,021
Reliance Industries Ltd. GDS 558,100 6,278,625
State Bank of India 3,318,600 21,614,503
State Bank of India Ltd. GDR `D' 65,000 981,500
------------
62,020,514
------------
</TABLE>
See Accompanying Notes to Financial Statements.
36
<PAGE>
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
---------- ------------
<S> <C> <C>
COMMON STOCK (CONT'D)
Indonesia (1.3%)
P.T. Bank International Indonesia 6,487,840 $ 10,449,651
P.T. Indosat 1,041,000 3,152,174
P.T. Indosat ADR 80,000 2,410,000
P.T. Mulia Industrindo 6,790,280 6,416,242
P.T. Semen Gresik 2,396,000 6,894,964
P.T. Sinar Mas Multiartha 711,100 717,743
P.T. Telekomunikasi Indonesia ADR 59,500 1,785,000
P.T. Telekomunikasi Indonesia Series B 7,505,000 11,201,493
------------
43,027,267
------------
Israel (1.1%)
Ampal-American Israel Corp. Class A 1,374,000 6,526,500
ECI Telecommunications Limited Designs 1,462,100 29,242,000
------------
35,768,500
------------
Japan (27.2%)
Canon, Inc. 2,526,000 48,427,402
Canon, Inc. ADR 98,040 9,448,605
Daibiru Corp. 263,000 2,983,643
Daimaru, Inc. 1,026,000 6,189,746
DDI Corp. 5,952 44,753,847
East Japan Railway Co. 2,137 9,828,960
Fujitsu Ltd. 1,784,000 15,689,034
Hankyu Realty Co., Ltd. 1,449,000 13,125,231
Hitachi Ltd. 3,706,250 32,919,818
Honda Motor Co. 1,631,000 39,014,335
Isuzu Motors Ltd. 4,418,000 21,874,365
Itochu Corp. 1,262,000 7,624,606
Jusco Co., Ltd. 1,542,000 45,835,546
Kao Corp. 500 5,892
Kawasaki Heavy Industries 6,357,000 29,126,699
Keyence Corp. 75,600 8,776,009
Kirin Beverage Corp. 124,000 1,657,550
Mitsubishi Corp. 395,000 4,411,661
Mitsubishi Estate Co., Ltd. 2,390,000 29,846,100
Mitsubishi Heavy Industries Ltd. 4,213,000 32,419,092
Murata Manufacturing Co., Ltd. 337,310 10,857,045
Mycal Corp. 1,942,500 29,895,128
Nikko Securities Co., Ltd. 2,215,000 21,232,521
Nippon Communication Systems Corp. 1,332,700 17,111,441
Nippon Telegraph & Telephone Corp. 5,556 38,844,604
NKK Corp. `D' 13,309,000 33,474,400
NTT Data Communications Systems Co. 1,108 32,837,569
Orix Corp. 997,100 37,179,703
Pioneer Electronic Corp. 1,355,000 26,811,626
Rohm Co., Ltd. 283,000 16,799,314
Sharp Corp. 2,065,000 31,417,202
Sony Corp. 577,300 34,675,569
Sony Corp. ADR 113,500 6,852,563
TDK Corp. 892,000 52,401,371
</TABLE>
See Accompanying Notes to Financial Statements.
37
<PAGE>
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
---------- ------------
<S> <C> <C>
COMMON STOCK (CONT'D)
Japan (cont'd)
Toho Co., Ltd. 130,240 $ 20,043,972
Toray Industries, Inc. 4,917,000 29,706,965
Tsuchiya Home Co. 300,982 4,737,998
Uny Co., Ltd. 1,196,500 20,729,092
West Japan Railway Co. `D' 4,926 16,115,311
Yokogawa Electric 2,198,000 19,523,173
York-Benimaru Co., Ltd. 505,900 16,639,398
------------
921,844,106
------------
Malaysia (0.3%)
Land and General BHD 1,140,000 2,482,185
Westmont Industries BHD 4,156,800 7,010,280
------------
9,492,465
------------
Mexico (0.6%)
Gruma SA de CV Class B `D' 4,298,700 21,386,300
------------
New Zealand (5.2%)
Brierley Investments Ltd. 38,877,804 35,452,708
Fletcher Challenge Building 12,605,422 34,128,260
Fletcher Challenge Energy 22 63
Fletcher Challenge Forestry 18,209,323 30,378,322
Fletcher Challenge Paper 5,024,844 9,093,279
Lion Nathan Ltd. 12,620,400 32,562,967
Sky City Ltd. `D' 3,768,200 21,576,299
Wrightson Ltd. 14,548,459 12,752,539
------------
175,944,437
------------
Norway (1.4%)
Den Norske Bank AS 8,080,000 26,859,007
Norsk Hydro AS ADR 462,022 21,195,259
------------
48,054,266
------------
Pakistan (0.1%)
Pakistan Telecommunications Corp. GDR `D' 56,200 4,327,400
------------
Philippines (0.5%)
Millicom International Cellular SA GDR `D' 385,900 15,339,525
------------
Portugal (1.6%)
Portugal Telecom SA 742,600 19,318,570
Portugal Telecom SA ADR 1,318,100 34,105,837
------------
53,424,407
------------
Singapore (1.9%)
DBS Land Ltd. 7,762,000 24,471,547
Development Bank of Singapore Ltd. 2,972,250 35,667,844
Development Bank of Singapore Ltd. ADR 79,500 3,814,251
------------
63,953,642
------------
</TABLE>
See Accompanying Notes to Financial Statements.
38
<PAGE>
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
---------- ------------
<S> <C> <C>
COMMON STOCK (CONT'D)
South Korea (3.9%)
Daewoo Electronics Co., Ltd. 1,954,250 $ 15,890,140
Hana Bank 473,969 7,441,716
Hana Bank (New) 82,070 1,226,717
Hanil Bank 2,697,312 24,817,889
Inchon Iron & Steel Co., Ltd. 13,400 289,466
Inchon Iron & Steel Co., Ltd. (New) `D' 8,287 173,987
Keum Kang Development Ind. Co. 158,000 2,665,291
Kookmin Bank GDR `D' 212,000 4,425,500
Korea Electric Power Corp. 160,000 4,718,447
Korea Europe Fund Ltd. 1,210 3,781,250
Korea Long Term Credit Bank 668,771 14,446,752
L.G. Construction Ltd. `D' 548,370 10,914,160
Samsung Electronics Co., Ltd. 224,241 15,811,168
Samsung Electronics Co., Ltd. (New) 48,546 3,328,700
Samsung Electronics Co., Ltd. GDR (Non-Voting) `D' 92,877 1,996,856
Samsung Electronics Co., Ltd. GDR (Voting) `D' 54,014 2,484,644
Samsung Heavy Industries Co., Ltd. 225,173 2,760,009
Samsung Heavy Industries Co., Ltd. (New) `D' 48,568 566,430
Ssangyong Investment & Securities Co., Ltd. `D' 872,610 13,343,308
------------
131,082,430
------------
Spain (3.6%)
Banco de Santander 154,866 7,952,742
Banco de Santander ADR 1,202,700 62,390,063
Iberdrola SA 2,177,500 23,132,203
Repsol SA ADR 869,700 28,373,963
------------
121,848,971
------------
Sweden (2.7%)
ABB Series B 266,500 29,745,025
Astra AB Series B 1,328,400 60,682,472
------------
90,427,497
------------
Switzerland (2.2%)
ABB AG Group 23,508 29,105,497
Ciba Geigy AG B 21,780 26,758,878
Danzas Holding AG 12,824 14,484,940
Tag Heuer International SA `D' 24,500 3,981,056
------------
74,330,371
------------
Taiwan (2.6%)
China Steel Corp. 29,333,000 26,114,044
Hocheng Group Corp. 6,670,000 10,664,244
Tatung Co., Ltd. 14,502,250 27,665,993
Ton Yi Industrial Corp. `D' 19,586,693 23,629,295
------------
88,073,576
------------
</TABLE>
See Accompanying Notes to Financial Statements.
39
<PAGE>
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
---------- ------------
<S> <C> <C>
COMMON STOCK (CONT'D)
Thailand (1.1%)
Bangkok Bank Public Co., Ltd. 637,900 $ 6,820,314
Industrial Finance Corp. of Thailand 6,407,400 18,889,741
Siam Cement Co. Ltd. 189,400 6,492,013
Thai Military Bank Public Co., Ltd. 2,475,100 5,740,208
------------
37,942,276
------------
United Kingdom (6.8%)
AAF Industries PLC `D' 647,550 352,987
British Airport Authority PLC 4,136,164 33,483,571
Cookson Group PLC 8,596,332 31,682,710
Grand Metropolitan PLC 3,166,991 23,885,674
Grand Metropolitan PLC ADR 125,589 3,846,163
London Pacific Group, Ltd. 3,005,000 11,417,534
Rolls-Royce PLC 8,116,000 33,544,142
Singer and Friedlander Group PLC 7,274,400 14,855,314
TC Group PLC 5,849,900 13,802,488
Thistle Hotels PLC `D' 6,470,000 17,634,373
Trio Holdings PLC `D' 7,868,850 704,231
Vodafone Group PLC Ord 11,726,000 45,316,300
------------
230,525,487
------------
TOTAL COMMON STOCK (Cost $2,997,040,554) 3,187,099,186
------------
PREFERRED STOCK (0.2%)
South Korea (0.1%)
Samsung Electronics Co., Ltd. 65,547 2,372,101
Samsung Electronics Co., Ltd. (New) `D' 19,754 686,799
------------
3,058,900
------------
United Kingdom (0.1%)
Singer & Friedlander Group PLC, 8.50% Convertible 1,435,737 3,539,390
------------
TOTAL PREFERRED STOCK (Cost $16,809,670) 6,598,290
------------
RIGHTS & WARRANTS (0.0%)
Hong Kong (0.0%)
Jardine Strategic Holdings Ltd. Wts., 05/02/98 `D' 2,115,400 613,466
------------
Israel (0.0%)
Ampal-American Israel Corp. Class A Wts., 01/31/99 `D' 455,000 85,313
------------
Japan (0.0%)
Bandai Industries Wts., 11/04/97 `D' 1,166 291,500
------------
TOTAL RIGHTS & WARRANTS (Cost $3,257,371) 990,279
------------
CALL OPTIONS (0.1%)
Japan (0.1%)
Topix Index, 03/14/97 (Strike Price 1,539.20) `D' 3,188,182 1,927,575
------------
</TABLE>
See Accompanying Notes to Financial Statements.
40
<PAGE>
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
---------- ------------
<S> <C> <C>
CALL OPTIONS (CONT'D)
New Zealand (0.0%)
Air New Zealand Ltd., 05/01/98 (Strike Price $2.4615) `D' 21,250,000 $ 212,500
Air New Zealand Ltd., 05/01/98 (Strike Price $2.5895) `D' 21,250,000 140,250
------------
352,750
------------
South Korea (0.0%)
Kospi 200 Index, 12/04/96 (Strike Price $.126002) `D' 147,545,262 0
Kospi 200 Index, 12/06/96 (Strike Price $.125812) `D' 145,630,647 146
Kospi 200 Index, 12/13/96 (Strike Price $.118539) `D' 135,807,497 3,667
Kospi 200 Index, 01/24/97 (Strike Price $.108243) `D' 167,172,363 213,312
Kospi 200 Index, 02/07/97 (Strike Price $.110156) `D' 138,331,959 177,618
------------
394,743
------------
TOTAL CALL OPTIONS (Cost $14,736,728) 2,675,068
------------
</TABLE>
<TABLE>
<CAPTION>
PAR
--------------
<S> <C> <C> <C>
CONVERTIBLE BONDS/NOTES (1.3%)
Argentina (0.2%)
Banco de Galicia & Buenos Aires SA 7.00%, 08/01/02 $ 7,648,000 7,495,040
--------------
Japan (0.8%)
Matsushita Electric Works Ltd. 2.70%, 05/31/02 (A) 2,465,000,000 26,013,543
--------------
New Zealand (0.0%)
Brierley Investments Ltd. 9.00%, 06/30/98 (B) 1,314,875 1,106,087
--------------
Thailand (0.3%)
Bangkok Bank Public Co. Ltd., 3.25%, 03/03/04 $ 9,220,000 9,473,550
--------------
TOTAL CONVERTIBLE BONDS/NOTES (Cost $44,769,169) 44,088,220
--------------
<CAPTION>
SHORT-TERM INVESTMENTS (2.2%)
<S> <C> <C> <C>
Repurchase agreement with State Street Bank & Trust Co.
dated 10/31/96 at 5.51% to be repurchased at $74,875,458
on 11/01/96. (Collateralized by $75,515,000 U.S. Treasury
Note 6.125%, due 03/31/98. Market value of collateral is
$76,364,544.) (Cost $74,864,000) 74,864,000 74,864,000
--------------
</TABLE>
See Accompanying Notes to Financial Statements.
41
<PAGE>
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE
--------------
<S> <C>
TOTAL INVESTMENTS AT VALUE (97.9%) (Cost $3,151,477,492*) $3,316,315,043
OTHER ASSETS IN EXCESS OF LIABILITIES (2.1%) 69,603,150
--------------
NET ASSETS (100.0%) (applicable to 139,432,457 Common Shares
and 24,413,853 Advisor Shares) $3,385,918,193
--------------
--------------
NET ASSET VALUE, offering and redemption price per Common Share
($2,885,453,131[div]139,432,457) $20.69
------
------
NET ASSET VALUE, offering and redemption price per Advisor Share
($500,465,062[div]24,413,853) $20.50
------
------
</TABLE>
INVESTMENT ABBREVIATIONS
ADR = American Depository Receipt
GDR = Global Depository Receipt
GDS = Global Depository Share
- --------------------------------------------------------------------------------
`D' Non-income producing security.
* Cost for Federal income tax purposes is $3,151,484,174.
(A) Denominated in Japanese Yen.
(B) Denominated in New Zealand Dollars
See Accompanying Notes to Financial Statements.
42
<PAGE>
<PAGE>
WARBURG PINCUS JAPAN OTC FUND
SCHEDULE OF INVESTMENTS
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- ------------
<S> <C> <C>
COMMON STOCK (97.7%)
Automotive Parts-Equipment (0.9%)
Royal Ltd. 30,000 $ 678,041
Yamakawa Industrial Co., Ltd. 100,000 686,395
------------
1,364,436
------------
Banking (2.6%)
Ace Koeki Co., Ltd. 15,000 178,085
Yutaka Shoji Co., Ltd. 200,000 3,693,607
------------
3,871,692
------------
Building Materials (0.7%)
Emoto Industry Co. 90,000 641,105
Furusato Industries Ltd. 29,000 377,451
------------
1,018,556
------------
Business Services (0.5%)
Nippon Wilson Learning Co. 15,000 708,381
------------
Commercial Services (0.5%)
Gakuikusha Corp. 80,000 816,111
------------
Computers (2.2%)
Japan Knowledge Industry Co. 50,000 659,573
Meitec Corp. 70,000 1,440,507
Melco, Inc. 500 14,950
Softbank Corp. 11,580 1,099,850
------------
3,214,880
------------
Construction (2.3%)
Onoken Co., Ltd. 62,000 1,254,067
Picoi Company Ltd. `D' 12,000 263,829
Yamazaki Construction Co., Ltd. 150,000 1,873,186
------------
3,391,082
------------
Drugs & Cosmetics (1.5%)
Mandom Corp. 150,000 2,150,207
------------
Electrical Equipment (0.1%)
Canare Electric Co. 7,000 172,368
------------
</TABLE>
See Accompanying Notes to Financial Statements.
43
<PAGE>
<PAGE>
WARBURG PINCUS JAPAN OTC FUND
SCHEDULE OF INVESTMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- ------------
<S> <C> <C>
COMMON STOCK (CONT'D)
Electronics (3.7%)
Ado Electronic Industrial Co., Ltd. 45,000 $ 1,076,422
Katsuragawa Electric Co., Ltd. 117,000 1,100,959
Kel Corp. 72,000 823,147
New Japan Radio Co., Ltd. 146,000 1,104,212
Nihon Electric Wire & Cable Co. 100,000 967,373
Yamaichi Electronics Co., Ltd. 19,000 359,247
------------
5,431,360
------------
Engineering & Construction (1.7%)
Masaru Corp. 100,000 825,785
Sawako Corp. 50,000 897,019
Taisei Oncho Co., Ltd. 56,000 733,796
------------
2,456,600
------------
Financial Services (7.7%)
Daiichi Commodities Co., Ltd. 93,000 842,406
Japan Asia Investment Co., Ltd. `D' 50,000 488,084
Japan Associated Finance Co., Ltd. 11,000 906,429
Okato Shoji Co., Ltd. 153,000 1,964,471
Shohkoh Fund & Co., Ltd. 30,000 6,305,514
Takefuji Corp. `D' 10,000 726,409
------------
11,233,313
------------
Foods (2.5%)
Kb Co., Ltd. `D' 70,000 548,501
Mefos Ltd. 16,000 343,330
Shidax Corp. `D' 44,400 2,733,269
------------
3,625,100
------------
Food Processing (1.6%)
Ok Food Industry Co., Ltd. `D' 419,000 1,061,226
Sato Foods Industries Co., Ltd. 68,000 1,252,836
------------
2,314,062
------------
Healthcare (3.3%)
Nichii Gakkan Co. 100,000 4,836,866
------------
Home Appliances (8.3%)
Yamada Denki Co., Ltd. 541,000 12,179,756
------------
Home Furnishings/Housewares (1.4%)
Amway Japan Ltd. 50,000 1,996,306
------------
</TABLE>
See Accompanying Notes to Financial Statements.
44
<PAGE>
<PAGE>
WARBURG PINCUS JAPAN OTC FUND
SCHEDULE OF INVESTMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- ------------
<S> <C> <C>
COMMON STOCK (CONT'D)
Machinery (Electric) (3.8%)
Meiki Co. 100,000 $ 993,756
Misumi Corp. 114,200 2,611,204
Nissei Asb Machine Co.`D' 136,000 2,033,242
------------
5,638,202
------------
Manufacturing (9.0%)
Fujimi, Inc. 16,400 822,091
Jamco Corp. 250,000 3,407,792
Kadoya Sesame Mills, Inc. 143,000 1,578,269
Nitori Co., Ltd. 50,000 888,224
Nitta Industrial Corp. 151,000 2,363,732
Nitto Kohki Co., Ltd. 45,000 1,484,038
Tokyo Denpa Co., Ltd. 20,000 694,750
Ube-Nitto Kasei Co., Ltd. 200,000 1,952,335
------------
13,191,231
------------
Pharmaceuticals (0.7%)
Fuji Pharmaceutical Co., Ltd. 136,000 956,820
------------
Restaurants (12.3%)
Doutor Coffee Co., Ltd. 100,000 4,441,122
Jonathan's Co., Ltd. 16,000 232,170
Plenus Co., Ltd. 238,000 10,046,610
Saint Marc Co., Ltd. 44,400 3,358,016
------------
18,077,918
------------
Retail (14.6%)
Aderans Co., Ltd. 63,000 1,529,153
Circle K Japan Co., Ltd. 93,000 3,884,883
Fast Retailing Co., Ltd 3,000 79,676
House of Rose Co., Ltd. `D' 22,000 501,099
Keiiyu Co., Ltd. 10,000 241,843
Kuroganeya Co., Ltd. 81,000 1,125,495
Ryohin Keikaku Co., Ltd. 45,000 3,617,096
Sundrug Co., Ltd. 194,000 7,250,901
Suruga Co., Ltd. 54,000 1,087,503
Yamazawa Co., Ltd. 160,000 2,110,632
------------
21,428,281
------------
</TABLE>
See Accompanying Notes to Financial Statements.
45
<PAGE>
<PAGE>
WARBURG PINCUS JAPAN OTC FUND
SCHEDULE OF INVESTMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- ------------
<S> <C> <C>
COMMON STOCK (CONT'D)
Retail Merchandising (10.7%)
Blue Grass Co., Ltd. 40,000 $ 858,324
Cox Corp. 150,000 1,345,528
Jeans Mate Corp. 45,700 1,446,838
Konaka Co., Ltd. 165,000 2,176,590
Leo Co., Ltd. 110,000 880,310
Nagaileben Co., Ltd. 90,400 3,796,148
Paris Miki, Inc. 130,300 5,156,539
Right On Co., Ltd. 6,000 73,872
------------
15,734,149
------------
Shipbuilding (0.5%)
Namura Shipbuilding Co., Ltd. 200,000 745,757
------------
Transportation (1.0%)
K.R.S. Corp. 100,000 1,521,414
------------
Travel (3.6%)
H.I.S. Co., Ltd. 100,000 5,311,758
------------
TOTAL COMMON STOCK (Cost $156,732,015) 143,386,606
------------
<CAPTION>
PAR
---------
<S> <C> <C>
SHORT-TERM INVESTMENTS (2.3%)
Repurchase agreement with State Street Bank & Trust Co. dated
10/31/96 at 5.51% to be repurchased at $3,353,513 on
11/01/96. (Collateralized by $3,325,000 U.S. Treasury Note
6.00%, due 05/31/98. Market value of collateral is
$3,423,460.) (Cost $3,353,000) $3,353,000 3,353,000
------------
TOTAL INVESTMENTS AT VALUE (100.0%) (Cost $160,085,015*) $146,739,606
------------
------------
</TABLE>
- --------------------------------------------------------------------------------
`D' Non-income producing security.
* Also cost for Federal income tax purposes.
See Accompanying Notes to Financial Statements.
46
<PAGE>
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
STATEMENT OF NET ASSETS
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
----------- ------------
<S> <C> <C>
COMMON STOCK (95.1%)
Argentina (4.6%)
Banco Frances del Rio de la Plata SA ADR 64,000 $ 1,680,000
Telefonica de Argentina SA ADR 187,300 4,354,725
YPF SA ADR 180,300 4,101,825
------------
10,136,550
------------
Australia (7.1%)
Accor Asia Pacific Co., Ltd. 10,860,253 6,538,654
Novus Petroleum Ltd. 4,904,223 8,935,788
------------
15,474,442
------------
Brazil (4.3%)
Celesc-Centrais Electricas de Santa Catarina SA ADR `D' 37,000 3,117,250
Globex Utilidades SA `D' 95,000 1,794,023
Panamerican Beverages, Inc. Class A 103,000 4,493,375
------------
9,404,648
------------
Chile (7.6%)
Banco de A. Edwards ADR 297,900 5,697,338
Compania de Telecommunicacion de Chile SA ADR 6,450 636,131
Enersis SA ADR 236,100 6,935,438
Santa Isabel SA ADR 100,000 2,812,500
Sociedad Quimica y Minera de Chile ADR 9,100 523,250
------------
16,604,657
------------
China (5.5%)
Cheung Kong Infrastructure Holdings Ltd. `D' 1,000,000 1,862,462
China Hong Kong Photo Products Holdings Ltd. 2,394,000 905,681
Ek Chor China Motorcycle Co., Ltd. 80,000 470,000
Guangshen Railway Co., Ltd. `D' 5,460,421 2,030,434
Guangshen Railway Co., Ltd. ADR `D' 279,368 5,203,229
Henderson China Holding Ltd. 443,000 1,002,690
Shanghai Haixing Shipping 8,076,000 595,383
------------
12,069,879
------------
Egypt (2.4%)
Commercial International Bank Ltd. 13,511 1,789,763
Commercial International Bank Ltd. GDR `D' 117,700 1,706,650
Mibbank International `D' 6,778 745,739
Suez Cement Co., Ltd. 67,000 958,054
------------
5,200,206
------------
</TABLE>
See Accompanying Notes to Financial Statements.
47
<PAGE>
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
----------- ------------
<S> <C> <C>
COMMON STOCK (CONT'D)
Hong Kong (5.2%)
Cathay Pacific Airways 552,000 $ 863,872
Citic Pacific Ltd. 91,100 443,028
Hong Kong Land Holdings Ltd. 2,154,000 4,803,420
Hong Kong Land Holdings Ltd. ADR 150,700 1,680,305
HSBC Holdings PLC 7 143
Jardine Matheson Holdings Ltd. ADR 429,272 2,425,387
Wing Hang Bank Ltd. 260,000 1,045,824
------------
11,261,979
------------
India (4.9%)
Bharat Petroleum Corp., Ltd. 24,000 189,545
Bombay Suburban Electric Supply Co., Ltd 355,150 1,956,888
Bombay Suburban Electric Supply Co., Ltd. GDR 46,500 883,500
Crompton Greaves Co., Ltd. 128,000 506,358
Crompton Greaves Co., Ltd. GDR `D' 26,000 112,710
Grasim Industries Ltd. 53,550 634,384
Grasim Industries Ltd. GDR 65,700 919,800
Hindalco Industries Ltd. 3,225 53,583
Indorama Synthetics GDR 305,000 2,655,940
Reliance Industries Ltd. 39,000 223,156
Reliance Industries Ltd. GDS 83,700 941,625
State Bank of India Ltd. 97,800 636,985
State Bank of India Ltd. GDR `D' 70,000 1,057,000
------------
10,771,474
------------
Indonesia (6.7%)
P.T. Bank International Indonesia 10,699 17,232
P.T. Bank Nisp 1,602,500 1,780,938
P.T. Dynaplast Ltd. 2,209,000 2,348,233
P.T. Indosat 78,000 236,186
P.T. Indosat ADR 41,500 1,250,188
P.T. Mulia Industrindo 259,350 245,064
P.T. Pabrik Kertas Tjiwi Kimia 1,331,000 1,372,018
P.T. Semen Cibinong 772,000 1,707,634
P.T. Sinar Mas Multiartha 2,269,500 2,290,701
P.T. Steady Safe Transportation Service 3,491,032 3,373,702
------------
14,621,896
------------
</TABLE>
See Accompanying Notes to Financial Statements.
48
<PAGE>
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
----------- ------------
<S> <C> <C>
COMMON STOCK (CONT'D)
Israel (3.9%)
Ampal-American Israel Corp. Class A 4,200 $ 19,950
Blue Square-Israel Ltd. ADR `D' 306,200 4,822,650
Clal Electronics Industries Ltd. 6,902 538,062
ECI Telecommunications Limited Designs 154,200 3,084,000
------------
8,464,662
------------
Malaysia (1.6%)
Land and General BHD 1,599,500 3,482,680
------------
Mexico (1.3%)
Gruma SA de CV Class B `D' 574,035 2,855,860
------------
Morocco (0.7%)
Banq Marocaine Commerce GDR `D' 100,000 1,587,500
------------
Philippines (3.3%)
Millicom International Cellular SA ADR `D' 137,300 5,457,675
Solid Group Inc. `D' 8,210,000 1,689,558
------------
7,147,233
------------
Portugal (5.5%)
Cimpor-Cimentos de Portugal SA 93,500 1,966,073
Portugal Telecom SA 39,200 1,019,779
Portugal Telecom SA ADR 199,600 5,164,650
Sonae Investimentos Sociedade Gestora de Participacoes
Sociais SA 129,800 3,806,019
------------
11,956,521
------------
Russia (0.4%)
The Russian Prosperity Fund Class A `D' 78,000 802,620
------------
Singapore (4.1%)
DBS Land Ltd. 1,300,000 4,098,559
Development Bank of Singapore Ltd. 405,000 4,860,115
------------
8,958,674
------------
</TABLE>
See Accompanying Notes to Financial Statements.
49
<PAGE>
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
----------- ------------
<S> <C> <C>
COMMON STOCK (CONT'D)
South Korea (11.5%)
Chonggu Housing and Construction 184,990 $ 4,332,897
Daewoo Electronics Co., Ltd. 449,480 3,654,752
Hana Bank 13,156 206,560
Hana Bank (New) `D' 2,278 34,050
Hanil Bank 38,900 357,918
Inchon Iron & Steel Co., Ltd. 99,560 2,150,689
Inchon Iron & Steel Co., Ltd. (New) `D' 27,186 570,774
Keum Kang Development Ind. Co. `D' 109,130 1,840,906
Keyang Electric Machinery Co. 43,430 922,360
Keyang Electric Machinery Co. (New) `D' 9,553 191,292
Korea Long Term Credit Bank 41,910 905,337
L.G. Construction Co., Ltd. `D' 164,180 3,267,660
Samsung Electronics Co., Ltd. 54,965 3,875,566
Samsung Electronics Co., Ltd. (New) `D' 1,966 134,805
Samsung Electronics Co., Ltd. GDR 3,700 170,200
Ssangyong Investment & Securities Co., Ltd. `D' 165,700 2,533,762
------------
25,149,528
------------
Taiwan (7.9%)
China Steel Corp. 1,242,300 1,105,972
GP-Taiwan Index Fund `D' 180,000 175,500
Hocheng Group Corp. 696,900 1,114,230
Pacific Electrical Wire and Cable Co. `D' 2,300,000 1,922,238
Phoenixtec Power Co., Ltd. `D' 4,065,180 6,647,278
Tatung Co., Ltd. 1,023,750 1,953,011
Ton Yi Industrial Corp. `D' 2,749,664 3,317,182
Wan Hai Lines Co., Ltd. 400,000 1,126,453
------------
17,361,864
------------
</TABLE>
See Accompanying Notes to Financial Statements.
50
<PAGE>
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
----------- ------------
<S> <C> <C>
COMMON STOCK (CONT'D)
Thailand (5.9%)
Bangkok Bank Public Co., Ltd. 187,800 $ 2,007,924
First Bangkok City Bank Public Co., Ltd. 1,196,300 1,387,219
I.C.C. International Public Co., Ltd. 136,100 888,074
Industrial Finance Corp. of Thailand 597,600 1,726,557
Jasmine International Public Co., Ltd. 778,300 2,141,549
Land and House Public Co., Ltd. 87,600 730,000
Loxley Public Co., Ltd. 96,800 703,931
Matichon Public Co., Ltd. 49,500 229,599
Ruam Pattana Fund II 3,822,000 1,765,271
Siam Cement Public Co., Ltd. 13,700 469,591
Thai Military Bank Public Co., Ltd. 366,200 849,284
------------
12,898,999
------------
Zimbabwe (0.7%)
Trans Zambesi Industries GDR 750,000 1,537,500
------------
TOTAL COMMON STOCK (Cost $215,979,893) 207,749,372
------------
PREFERRED STOCK (0.2%)
South Korea (0.2%)
Keyang Electronic Machinery Co. 4,190 34,934
Samsung Electronics Co., Ltd. 10,155 367,503
Samsung Electronics Co., Ltd. (New) `D' 3,060 106,389
------------
TOTAL PREFERRED STOCK (Cost $1,171,760) 508,826
------------
STOCK WARRANTS (0.0%)
Hong Kong (0.0%)
Jardine Strategic Holdings, 05/02/98 `D' 21,000 6,090
------------
TOTAL STOCK WARRANTS (Cost $10,610) 6,090
------------
CALL OPTIONS (0.0%)
South Korea (0.0%)
Kospi 200 Index, 12/04/96 (Strike Price $.126002) `D' 15,531,080 0
Kospi 200 Index, 12/06/96 (Strike Price $.125812) `D' 14,754,684 15
Kospi 200 Index, 12/13/96 (Strike Price $.118539) `D' 19,172,823 518
Kospi 200 Index, 01/24/97 (Strike Price $.108243) `D' 31,894,727 40,698
Kospi 200 Index, 02/07/97 (Strike Price $.110156) `D' 15,130,058 19,427
------------
TOTAL CALL OPTIONS (COST $1,170,025) 60,658
------------
</TABLE>
See Accompanying Notes to Financial Statements.
51
<PAGE>
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PAR VALUE
--- -----
<S> <C> <C>
CONVERTIBLE BONDS (2.3%)
China (0.9%)
Henderson Capital International 5.00%, 03/28/97 $2,230,000 $ 1,928,950
------------
Thailand (1.4%)
Bangkok Bank Public Co., Ltd. 3.25%, 03/03/04 3,040,000 3,123,600
------------
TOTAL CONVERTIBLE BONDS (Cost $5,673,602) 5,052,550
------------
SHORT-TERM INVESTMENTS (0.7%)
Repurchase agreement with State Street Bank & Trust Co.
dated 10/31/96 at 5.51% to be repurchased at $1,517,232 on
11/01/96. (Collateralized by $1,505,000 U.S. Treasury Note
6.00%, due 05/31/98. Market value of collateral is
$1,549,566.) (Cost $1,517,000.) 1,517,000 1,517,000
------------
TOTAL INVESTMENTS AT VALUE (98.3%) (Cost $225,522,890*) 214,894,496
OTHER ASSETS IN EXCESS OF LIABILITIES (1.7%) 3,675,851
------------
NET ASSETS (100.0%) (applicable to 17,916,617 Common Shares and
12,241 Advisor Shares) $218,570,347
------------
------------
NET ASSET VALUE, offering and redemption price per Common Share
($218,420,935[div]17,916,677) $12.19
------
------
NET ASSET VALUE, offering and redemption price per Advisor Share
($149,412[div]12,241) $12.21
------
------
</TABLE>
INVESTMENT ABBREVIATIONS
ADR = American Depository Receipt
GDR = Global Depository Receipt
GDS = Global Depository Share
- --------------------------------------------------------------------------------
`D' Non-income producing security.
* Cost for Federal income tax purposes is $225,598,155.
See Accompanying Notes to Financial Statements.
52
<PAGE>
<PAGE>
WARBURG PINCUS POST-VENTURE CAPITAL FUND
STATEMENT OF NET ASSETS
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- ------------
<S> <C> <C>
COMMON STOCK (90.9%)
Business Services (9.6%)
Abacus Direct Corp. `D' 7,200 $ 189,000
CCC Information Services Group `D' 43,300 811,875
COHR, Inc. `D' 140,000 3,430,000
Daisytek International Corp. `D' 44,300 1,694,475
First Data Corp. 12,000 957,000
On Assignment, Inc. `D' 56,000 1,722,000
Outdoor Systems, Inc. `D' 22,000 984,500
QuickResponse Services, Inc. `D' 67,000 2,487,375
Staffing Resources, Inc. `D' # 4,000 44,000
SunGard Data Systems, Inc. `D' 20,000 855,000
Universal Outdoor Holdings, Inc. `D' 39,600 1,163,250
Wilmar Industries, Inc. `D' 67,200 1,444,800
------------
15,783,275
------------
Computers (24.7%)
Applix, Inc. `D' 66,000 1,600,500
Aspect Development, Inc. `D' 38,000 945,250
Aurum Software, Inc. `D' 14,700 466,725
Avant! Corp. `D' 75,000 2,268,750
Baan Co., N.V. `D' 66,000 2,442,000
BMC Software, Inc. `D' 54,000 4,482,000
Citrix Systems, Inc. `D' 40,000 2,210,000
Clarify, Inc. `D' 74,000 3,570,500
FORE Systems, Inc. `D' 27,000 1,073,250
Integrated Systems, Inc. `D' 70,000 1,890,000
McAfee Associates, Inc. `D' 97,500 4,436,250
Memco Software Ltd. `D' 12,200 222,650
Parametric Technology Corp. 62,000 3,030,250
Peoplesoft Inc. `D' 22,000 1,974,500
Pure Atria Corp. `D' 99,624 2,714,754
Rational Software Corp. `D' 93,400 3,584,225
SQA, Inc. `D' 49,000 1,341,375
Tecnomatix Technologies Ltd. `D' 150,000 2,606,250
------------
40,859,229
------------
Consumer Non-Durables (1.4%)
Carson, Inc. Class A `D' 18,100 294,125
Sola International, Inc. `D' 55,000 1,986,875
------------
2,281,000
------------
</TABLE>
See Accompanying Notes to Financial Statements.
53
<PAGE>
<PAGE>
WARBURG PINCUS POST-VENTURE CAPITAL FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- ------------
<S> <C> <C>
COMMON STOCK (CONT'D)
Consumer Services (2.5%)
DeVRY, Inc. `D' 50,000 $ 2,493,750
Veterinary Centers of America, Inc. `D' 88,000 1,617,000
------------
4,110,750
------------
Electronics (11.6%)
Altera Corp. `D' 33,500 2,077,000
EPIC Design Technology, Inc. `D' 93,000 2,278,500
Glenayre Technologies, Inc. `D' 102,000 2,626,500
Linear Technology Corp. 42,000 1,407,000
Maxim Integrated Products, Inc. `D' 75,000 2,625,000
Microchip Technology, Inc. `D' 64,000 2,320,000
SELECT Software Tools ADR `D' 11,700 257,400
Synopsys, Inc. `D' 62,000 2,790,000
Xilinx, Inc. `D' 85,000 2,783,750
------------
19,165,150
------------
Environmental Services (1.6%)
USA Waste Services, Inc. `D' 80,000 2,560,000
------------
Financial Services (2.4%)
PMT Services, Inc. `D' 130,000 2,600,000
Transaction Systems Architects, Inc. Class A `D' 34,000 1,411,000
------------
4,011,000
------------
Healthcare (8.2%)
Advanced Tissue Sciences, Inc. `D' 70,000 1,137,500
American Oncology Resources, Inc. `D' 140,000 1,120,000
EmCare Holdings, Inc. `D' 128,000 3,200,000
Harborside Healthcare Corp. `D' 120,000 1,185,000
OccuSystems, Inc. `D' 47,000 1,286,625
PhyMatrix Corp. `D' 14,900 247,712
Physician Reliance Network, Inc. `D' 180,000 1,057,500
Trex Medical Corp. `D' 3,800 66,975
Trex Medical Corp. `D' # 2,400 40,185
VISX, Inc. `D' 90,000 2,272,500
Vivra, Inc. `D' 61,000 1,944,375
------------
13,558,372
------------
Leisure & Entertainment (2.3%)
Premier Parks, Inc. `D' 63,100 2,003,425
Regal Cinemas, Inc. `D' 67,000 1,742,000
------------
3,745,425
------------
</TABLE>
See Accompanying Notes to Financial Statements.
54
<PAGE>
<PAGE>
WARBURG PINCUS POST-VENTURE CAPITAL FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- ------------
<S> <C> <C>
COMMON STOCK (CONT'D)
Lodging & Restaurants (1.2%)
Doubletree Corp. `D' 50,900 $ 2,064,631
------------
Office Equipment & Supplies (2.2%)
Physician Computer Network `D' 235,000 2,100,313
Viking Office Products, Inc. `D' 53,200 1,549,450
------------
3,649,763
------------
Oil Services (2.4%)
Forcenergy Gas Exploration, Inc. `D' 72,000 1,971,000
Input/Output, Inc. `D' 69,000 2,052,750
------------
4,023,750
------------
Pharmaceuticals (9.1%)
Agouron Pharmaceuticals, Inc. `D' 19,000 1,087,750
Applied Analytical Industries, Inc. `D' 3,600 78,300
BioChem Pharma, Inc. `D' 40,000 1,705,000
Genzyme Corp. -- General Division `D' 80,000 1,840,000
Gilead Sciences, Inc. `D' 35,000 818,125
Ligand Pharmaceuticals, Inc. Class B `D' 76,000 940,500
Pharmaceutical Product Development, Inc. `D' 95,000 1,816,875
SangStat Medical Corp. `D' 90,000 2,362,500
Serologicals Corp. `D' 94,000 2,867,000
Vivus, Inc. 45,000 1,507,500
------------
15,023,550
------------
Retail (2.6%)
Borders Group, Inc. `D' 60,900 1,918,350
PETsMART, Inc. `D' 78,000 2,106,000
Stage Stores, Inc. `D' 17,300 315,725
------------
4,340,075
------------
Telecommunications & Equipment (7.9%)
Advanced Fibre Communication, Inc. `D' 9,800 559,825
Cascade Communications Corp. `D' 41,000 2,977,625
Mcleod, Inc. `D' 34,700 1,127,750
MFS Communications Co., Inc. 39,555 1,982,694
PictureTel Corp. `D' 36,000 972,000
Tellabs, Inc. `D' 27,000 2,298,375
3Com Corp. `D' 47,000 3,178,375
------------
13,096,644
------------
Transportation (1.2%)
Coach USA, Inc. `D' 70,000 1,907,500
------------
TOTAL COMMON STOCK (Cost $135,644,376) 150,180,114
------------
FOREIGN COMMON STOCK (0.9%)
Business Services
Freepages Group PLC `D' (Cost $1,418,565) 2,500,000 1,545,840
------------
</TABLE>
See Accompanying Notes to Financial Statements.
55
<PAGE>
<PAGE>
WARBURG PINCUS POST-VENTURE CAPITAL FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MATURITY PAR VALUE
-------- ----------- ------------
<S> <C> <C> <C>
UNITED STATES TREASURY OBLIGATIONS (0.6%)
U.S. Treasury Bills**
4.815% 12/19/96 $ 160,000 $ 158,953
4.89% 01/02/97 300,000 297,411
5.19% 09/18/97 500,000 477,100
------------
TOTAL UNITED STATES TREASURY OBLIGATIONS (Cost $933,283) 933,464
------------
<CAPTION>
<S> <C> <C> <C>
SHORT-TERM INVESTMENTS (6.7%)
Repurchase agreement with State Street Bank &
Trust Company dated 10/31/96 at 5.51% to be
repurchased at $11,114,701 on 11/01/96.
(Collateralized by $11,210,000 U.S. Treasury
Note 6.125%, due 03/31/98. Market value of
collateral is $11,336,113.) (Cost $11,113,000) 11,113,000 11,113,000
------------
TOTAL INVESTMENTS AT VALUE (99.1%) (Cost $149,109,224*) 163,772,418
OTHER ASSETS IN EXCESS OF LIABILITIES (0.9%) 1,512,900
------------
NET ASSETS (100.0%) (applicable to 10,300,847 Common
Shares and 12,818 Advisor Shares) $165,285,318
------------
------------
NET ASSET VALUE, offering and redemption price
per Common Share ($165,081,068[div]10,300,847) $16.03
------
------
NET ASSET VALUE, offering and redemption price
per Advisor Share ($204,250[div]12,818) $15.93
------
------
</TABLE>
INVESTMENT ABBREVIATIONS
ADR = American Depository Receipt
- --------------------------------------------------------------------------------
`D' Non-income producing security.
# Restricted or partially restricted security.
* Cost for Federal income tax purposes is $149,916,409.
** These securities have been segregated with the Funds' custodian to cover
open capital commitments of $930,000 in private fund investments.
See Accompanying Notes to Financial Statements.
56
<PAGE>
<PAGE>
WARBURG PINCUS JAPAN GROWTH FUND
STATEMENT OF NET ASSETS
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- -----------
<S> <C> <C>
COMMON STOCK (102.2%)
Aerospace (1.6%)
Mitsubishi Heavy Industries Ltd. 43,000 $ 330,886
-----------
Aerospace & Defense (2.4%)
Kawasaki Heavy Industries Ltd. 105,000 481,092
-----------
Automobiles (4.5%)
Honda Motor Co., Ltd. 20,000 478,410
Isuzu Motors Ltd. 85,000 420,851
-----------
899,261
-----------
Automotive Parts-Equipment (0.9%)
Hirata Technical Co., Ltd. 14,000 171,137
-----------
Business Services (0.9%)
Funai Consulting Co. 14,000 169,906
-----------
Capital Equipment (1.9%)
Sanden Corp. 50,000 372,878
-----------
Chemicals (2.0%)
Noritsu Koki Co., Ltd. 500 26,163
Toray Industries, Inc. 62,000 374,584
-----------
400,747
-----------
Communications & Media (1.9%)
NTT Data Communications Systems Co. 13 385,278
-----------
Computers (2.8%)
I.O. Data Device, Inc. 7,700 203,826
Net One System Co., Ltd.`D' 3,000 369,361
-----------
573,187
-----------
Electrical Equipment (1.8%)
Shinmei Electric Co. 18,000 360,918
-----------
</TABLE>
See Accompanying Notes to Financial Statements.
57
<PAGE>
<PAGE>
WARBURG PINCUS JAPAN GROWTH FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- -----------
<S> <C> <C>
COMMON STOCK (CONT'D)
Electronics (23.5%)
Advantest Corp. 7,000 $ 264,708
Anritsu Corp. 35,000 467,857
Daitec Co., Ltd. 8,000 467,857
Fujitsu Denso Ltd. 15,700 517,764
Keyence Corp. 3,200 371,471
Murata Manufacturing Co., Ltd. 9,000 289,684
Pioneer Electronic Corp. 23,000 455,105
Rohm Co., Ltd. 5,000 296,808
Sharp Corp. 31,000 471,638
Sony Corp. 6,300 378,410
TDK Corp. 7,000 411,222
Yamatake-Honeywell Co. 21,000 352,739
-----------
4,745,263
-----------
Engineering & Construction (2.0%)
Japan Industrial Land Development Co. 14,000 403,834
-----------
Entertainment (1.8%)
Shochiku Co. 36,000 367,250
-----------
Finance (2.4%)
Japan Asia Investment Co., Ltd.`D' 50,000 488,084
-----------
Financial Services (6.1%)
Orix Corp. 11,500 428,810
Shohkoh Fund & Co., Ltd. 2,400 504,441
Wako Securities Co. 47,000 296,772
-----------
1,230,023
-----------
Industrial Mfg. & Processing (5.6%)
Denki Kogyo Co., Ltd. 48,000 426,348
Fujikura Ltd. 55,000 419,356
Kitagawa Industries Co., Ltd. 7,000 283,177
-----------
1,128,881
-----------
Manufacturing (3.2%)
Nitta Corp. 26,000 407,000
Zuiko Corp. 13,000 243,514
-----------
650,514
-----------
Office Equipment (2.3%)
Canon, Inc. 24,000 460,118
-----------
</TABLE>
See Accompanying Notes to Financial Statements.
58
<PAGE>
<PAGE>
WARBURG PINCUS JAPAN GROWTH FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- -----------
<S> <C> <C>
COMMON STOCK (CONT'D)
Office Equipment & Supplies (2.0%)
King Jim Co., Ltd. 18,000 $ 413,156
-----------
Railroads (1.9%)
West Japan Railway Co. 120 392,578
-----------
Real Estate (9.8%)
Daibiru Corp. 26,000 294,961
Hankyu Realty Co. 53,000 480,081
Meiwa Estate Co., Ltd.`D' 18,000 555,623
Mitsubishi Estate Co., Ltd. 24,000 299,710
Tachihi Enterprise Co., Ltd. 10,000 343,857
-----------
1,974,232
-----------
Retail (2.1%)
Homac Corp. 5,600 100,959
Ryohin Keikaku Co., Ltd. 4,000 321,520
-----------
422,479
-----------
Retail Food Chains (7.3%)
Chain Store Okuwa Co., Ltd. 26,000 379,562
Jusco Co., Ltd. 16,000 475,596
Mycal Corp. 32,000 492,481
Uny Co., Ltd. 7,000 121,273
-----------
1,468,912
-----------
Steel (2.1%)
Nkk Corp.`D' 167,000 420,033
-----------
Telecommunications (2.1%)
Nippon Denwa Shisetsu Co. 39,000 425,292
-----------
Telecommunications & Equipment (3.5%)
Japan Radio Co. 23,000 307,449
Nitto Electric Works Ltd. 23,000 398,470
-----------
705,919
-----------
Textiles (1.5%)
Shoei Co. 25,000 296,809
-----------
Utilities-Telecommunication (2.3%)
DDI Corp. 62 466,187
-----------
TOTAL COMMON STOCK (Cost $21,940,756) 20,604,854
-----------
</TABLE>
See Accompanying Notes to Financial Statements.
59
<PAGE>
<PAGE>
WARBURG PINCUS JAPAN GROWTH FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- -----------
<S> <C> <C>
CALL OPTIONS (0.1%)
Japan
Topix Index, 03/14/97 (Strike Price 1,539.20) `D' 28,339 $ 17,134
-----------
TOTAL CALL OPTIONS (Cost $20,000) 17,134
-----------
<CAPTION>
PAR
---------
<S> <C> <C>
SHORT-TERM INVESTMENTS (0.7%)
Repurchase agreement with State Street Bank & Trust Co. dated
10/31/96 at 5.51% to be repurchased at $145,022 on 11/01/96.
(Collateralized by $150,000 U.S. Treasury Note 6.125%, due
03/31/98. Market value of collateral is $151,688.) (Cost
$145,000) $145,000 145,000
-----------
TOTAL INVESTMENTS AT VALUE (103.0%) (Cost $22,105,756*) 20,766,988
LIABILITIES IN EXCESS OF OTHER ASSETS (3.0%) (608,539)
-----------
NET ASSETS (100.0%) (applicable to 2,045,747 Common Shares and
120 Advisor Shares) $20,158,449
-----------
-----------
NET ASSET VALUE, offering and redemption price per Common Share
($20,157,269[div]2,045,747) $9.85
-----
-----
NET ASSET VALUE, offering and redemption price per Advisor Share
($1,180[div]120) $9.83
-----
-----
</TABLE>
- --------------------------------------------------------------------------------
`D' Non-income producing security.
* Cost for Federal income tax purposes is $22,124,870.
See Accompanying Notes to Financial Statements.
60
<PAGE>
<PAGE>
WARBURG PINCUS SMALL COMPANY VALUE FUND
STATEMENT OF NET ASSETS
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
---------- -----------
<S> <C> <C>
COMMON STOCK (92.4%)
Aerospace & Defense (2.2%)
Tracor, Inc. `D' 79,800 $ 1,815,450
-----------
Banks & Savings & Loans (11.9%)
Cullen/Frost Bankers, Inc. 33,600 1,010,100
Eagle Financial Corp. 54,800 1,465,900
Quaker City Bancorp, Inc. `D' 139,750 2,270,938
RCSB Financial, Inc. 99,100 2,873,900
Texas Regional Bancshares, Inc. 74,400 2,399,400
-----------
10,020,238
-----------
Business Services (2.2%)
American List Corp. 66,100 1,817,750
-----------
Capital Equipment (4.5%)
Allied Products Corp. 44,200 1,093,950
Avondale Industries, Inc. `D' 143,400 2,348,175
Wabash National Corp. 22,900 369,262
-----------
3,811,387
-----------
Chemicals (0.6%)
Foamex International, Inc. `D' 32,700 510,938
-----------
Communications & Media (0.4%)
Metro Networks, Inc. `D' 16,500 334,125
-----------
Conglomerates (1.2%)
Oglebay Norton Co. 22,500 978,750
-----------
Consumer Durables (1.8%)
Triangle Pacific Corp. 72,700 1,538,059
-----------
Consumer Non-Durables (12.4%)
American Safety Razor Corp. `D' 143,000 1,769,625
Donnkenny, Inc. `D' 89,400 1,128,675
Norton McNaughton, Inc. `D' 118,700 934,763
Samsonite Corp. `D' 50,700 1,711,125
Scotts Co. Class A `D' 103,600 1,929,550
Standex International Corp. 43,500 1,337,625
Westpoint Stevens, Inc. `D' 59,500 1,584,188
-----------
10,395,551
-----------
Electronics (7.4%)
ESCO Electronics Corp. `D' 267,800 2,611,050
Larson Davis, Inc. `D' 377,800 3,600,906
-----------
6,211,956
-----------
</TABLE>
See Accompanying Notes to Financial Statements.
61
<PAGE>
<PAGE>
WARBURG PINCUS SMALL COMPANY VALUE FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
---------- -----------
<S> <C> <C>
COMMON STOCK (CONT'D)
Energy (7.4)%
Forest Oil Corp. `D' 130,500 $ 1,957,500
Nuevo Energy Co. `D' 40,400 2,014,950
Patina Oil & Gas Corp. `D' 50,000 400,000
Texas Meridian Resources Corp. `D' 101,650 1,829,700
-----------
6,202,150
-----------
Engineering & Construction (1.5%)
Gradall Industries, Inc. `D' 119,200 1,296,300
-----------
Financial Services (11.7%)
Commerce Group, Inc. 68,500 1,644,000
First Alliance Corp. `D' 62,400 1,700,400
Liberty Financial Companies, Inc. 29,700 1,043,213
National Western Life Insurance Co. Class A `D' 18,800 1,447,600
Transport Holdings, Inc. Class A `D' 25,450 1,934,200
Triad Guaranty, Inc. `D' 41,350 1,250,837
White River Corp. `D' 13,700 794,600
-----------
9,814,850
-----------
Food, Beverages & Tobacco (1.5%)
Suiza Foods Corp. `D' 72,900 1,257,525
-----------
Healthcare (1.2%)
Hooper Holmes, Inc. 70,000 1,041,250
-----------
Industrial Mfg. & Processing (2.6%)
Schnitzer Steel Industries, Inc. Class A 72,200 1,922,325
Seda Specialty Packaging Corp. `D' 15,200 283,100
-----------
2,205,425
-----------
Leisure & Entertainment (1.6%)
SCP Pool Corp. `D' 77,000 1,386,000
-----------
Lodging & Restaurants (3.7%)
IHOP Corp. `D' 46,150 1,015,300
Morton's Restaurant Group, Inc. `D' 136,200 2,094,075
-----------
3,109,375
-----------
Metals & Mining (2.0%)
Universal Stainless & Alloy Products, Inc. `D' 193,300 1,643,050
-----------
Office Equipment & Supplies (1.1%)
New England Business Service, Inc. 49,700 894,600
-----------
</TABLE>
See Accompanying Notes to Financial Statements.
62
<PAGE>
<PAGE>
WARBURG PINCUS SMALL COMPANY VALUE FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
---------- -----------
<S> <C> <C>
COMMON STOCK (CONT'D)
Real Estate (6.3%)
Home Properties of New York, Inc. 89,700 $ 1,794,000
Jameson Inns, Inc. 174,100 1,915,100
U.S. Restaurant Properties Master L.P. 69,400 1,622,225
-----------
5,331,325
-----------
Retail (3.1%)
Cole National Corp. Class A `D' 89,850 2,122,705
Stage Stores, Inc. `D' 25,000 456,250
-----------
2,578,955
-----------
Transportation (4.1%)
Hub Group, Inc. Class A `D' 22,900 509,525
Landstar Systems, Inc. `D' 58,450 1,380,881
MTL, Inc. `D' 82,700 1,550,625
-----------
3,441,031
-----------
TOTAL COMMON STOCK (Cost $69,479,649) 77,636,040
-----------
<CAPTION>
SHORT-TERM INVESTMENTS (10.0%) PAR
----------
<S> <C> <C>
Repurchase agreement with State Street Bank & Trust Company
dated 10/31/96 at 5.51% to be repurchased at $8,429,290 on
11/01/96. (Collateralized by $8,505,000 U.S. Treasury Note
6.125%, due 03/31/98. Market value of collateral is
$8,600,681.) (Cost $8,428,000) $8,428,000 8,428,000
-----------
TOTAL INVESTMENTS AT VALUE (102.4%) (Cost $77,907,649*) 86,064,040
LIABILITIES IN EXCESS OF OTHER ASSETS (2.4%) (2,014,073)
-----------
NET ASSETS (100.0%) (applicable to 5,844,327 Common Shares and
327 Advisor Shares) $84,049,967
-----------
-----------
NET ASSET VALUE, offering and redemption price per Common Share
($84,045,239[div]5,844,327) $14.38
------
------
NET ASSET VALUE, offering and redemption price per Advisor
Share ($4,728[div]327) $14.46
------
------
</TABLE>
- --------------------------------------------------------------------------------
`D' Non-income producing security.
* Also cost for Federal income tax purposes.
See Accompanying Notes to Financial Statements.
63
<PAGE>
<PAGE>
WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND
STATEMENT OF NET ASSETS
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- ----------
<S> <C> <C>
COMMON STOCK (65.9%)
Business Services (8.9%)
COHR, Inc. `D' 1,600 $ 39,200
Corporate Express, Inc. `D' 700 22,837
Daisytek International Corp. `D' 700 26,775
First Data Corp. 500 39,875
Flextronics International Ltd. `D' 900 20,925
On Assignment, Inc. `D' 700 21,525
Outdoor Systems, Inc. `D' 600 26,850
QuickResponse Services, Inc. `D' 800 29,700
Superior Consultant Holdings, Inc. `D' 100 2,450
Walsh International, Inc. `D' 2,300 20,125
Wilmar Industries, Inc. `D' 800 17,200
----------
267,462
----------
Communications & Media (0.8%)
Central European Media Enterprises Ltd. Class A `D' 900 25,200
----------
Computers (18.5%)
Aurum Software, Inc. `D' 200 6,350
Baan Co. N.V. `D' 1,200 44,400
BMC Software, Inc. `D' 700 58,100
Citrix Systems, Inc. `D' 900 49,725
Clarify, Inc. `D' 1,500 72,375
FORE Systems, Inc. `D' 600 23,850
McAfee Associates, Inc. `D' 1,200 54,600
Memco Software Ltd. `D' 200 3,650
Parametric Technology Corp. `D' 1,000 48,875
PeopleSoft, Inc. `D' 700 62,825
Pure Atria Corp. `D' 1,300 35,425
Rational Software Corp. `D' 1,400 53,725
Tecnomatix Technologies Ltd. `D' 2,500 43,437
----------
557,337
----------
Consumer Non-Durables (1.1%)
Carson, Inc. Class A `D' 300 4,875
Sola International, Inc. `D' 800 28,900
----------
33,775
----------
Consumer Services (2.1%)
DeVRY, Inc. `D' 700 34,912
Veterinary Centers of America, Inc. `D' 1,500 27,562
----------
62,474
----------
</TABLE>
See Accompanying Notes to Financial Statements.
64
<PAGE>
<PAGE>
WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- ----------
<S> <C> <C>
COMMON STOCK (CONT'D)
Electronics (9.0%)
Altera Corp. `D' 500 $ 31,000
Avant! Corp. `D' 1,200 36,300
Glenayre Technologies, Inc. `D' 1,600 41,200
Linear Technology Corp. 500 16,750
Maxim Integrated Products, Inc. `D' 1,000 35,000
Microchip Technology, Inc. `D' 1,000 36,250
Synopsys, Inc. `D' 1,000 45,000
Xilinx, Inc. `D' 900 29,475
----------
270,975
----------
Environmental Services (1.0%)
USA Waste Services, Inc. `D' 1,000 32,000
----------
Financial Services (1.9%)
PMT Services, Inc. `D' 1,400 28,000
Transaction Systems Architects, Inc. Class A `D' 700 29,050
----------
57,050
----------
Healthcare (5.4%)
Advanced Tissue Sciences, Inc. `D' 600 9,750
EmCare Holdings, Inc. `D' 2,000 50,000
OccuSystems, Inc. `D' 900 24,638
Physician Reliance Network, Inc. `D' 3,600 21,150
VISX, Inc. `D' 1,100 27,775
Vivra, Inc. `D' 900 28,688
----------
162,001
----------
Leisure & Entertainment (1.3%)
Premier Parks, Inc. `D' 1,200 38,100
----------
Lodging & Restaurants (0.6%)
Doubletree Corp. `D' 500 20,281
----------
Office Equipment & Supplies (0.6%)
Viking Office Products, Inc. `D' 600 17,475
----------
Oil Services (0.6%)
Input/Output, Inc. `D' 600 17,850
----------
Pharmaceuticals (4.7%)
Agouron Pharmaceuticals, Inc. `D' 300 17,175
Bio Chem Pharmaceutical, Inc. `D' 700 29,838
Genzyme Corp. -- General Division `D' 500 11,500
</TABLE>
See Accompanying Notes to Financial Statements.
65
<PAGE>
<PAGE>
WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- ----------
<S> <C> <C>
COMMON STOCK (CONT'D)
Pharmaceuticals (cont'd)
Gilead Sciences, Inc. `D' 300 $ 7,013
Ligand Pharmaceuticals, Inc. Class B `D' 600 7,425
Pharmaceutical Product Development, Inc. `D' 1,400 26,775
Sangstat Medical Corp. `D' 400 10,500
Serologicals Corp. `D' 500 15,250
Vivus, Inc. `D' 500 16,750
----------
142,226
----------
Retail (1.6%)
Borders Group, Inc. `D' 600 18,900
PETsMART, Inc. `D' 900 24,300
Stage Stores, Inc. `D' 200 3,650
----------
46,850
----------
Telecommunications & Equipment (6.9%)
Cascade Communications Corp. `D' 400 29,050
Cisco Sytems, Inc. `D' 400 24,750
DSP Communications, Inc. `D' 1,000 38,000
MFS Communications Co., Inc. `D' 800 40,100
Millicom International Cellular S.A. `D' 500 19,875
Teledata Communications Ltd. `D' 2,000 31,750
Tellabs, Inc. `D' 300 25,538
----------
209,063
----------
Transportation (0.9%)
Coach USA, Inc. `D' 1,000 27,250
----------
TOTAL COMMON STOCK (Cost $2,026,413) 1,987,369
----------
FOREIGN COMMON STOCK (23.9%)
Austria (1.1%)
Bohler-Uddeholm AG 431 32,257
----------
Belgium (2.8%)
Barco N.V. `D' 507 83,416
----------
Indonesia (2.8%)
P.T. Indosat ADR 2,800 84,350
----------
Ireland (1.1%)
Saville Systems PLC ADR `D' 800 34,500
----------
Israel (1.1%)
Blue Square Israel Ltd. ADR `D' 2,100 33,075
----------
</TABLE>
See Accompanying Notes to Financial Statements.
66
<PAGE>
<PAGE>
WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- ----------
<S> <C> <C>
FOREIGN COMMON STOCK (CONT'D)
Japan (4.7%)
Fujitsu Denso Ltd. 1,000 $ 32,979
Japan Asia Investment Co., Ltd. `D' 3,000 29,285
Japan Industrial Land Development Co. 1,000 28,845
Meiwa Estate Co., Ltd. `D' 1,000 30,868
Shohkoh Fund & Co., Ltd. 100 21,018
----------
142,995
----------
Netherlands (0.7%)
Gucci Group N.V. 300 20,700
----------
Spain (1.9%)
Sol Melia S.A. `D' 2,166 57,652
----------
Switzerland (1.2%)
Ciba Geigy AG 30 36,997
----------
United Kingdom (6.5%)
Cookson Group PLC 8,970 33,060
Dorling Kindersley PLC 3,350 29,491
Freepages Group PLC `D' 48,000 29,680
H & C Furnishings PLC 10,700 41,525
Hays PLC 4,700 39,272
Select Software Tools Ltd. ADR `D' 100 2,200
Thistle Hotels PLC `D' 7,000 19,079
----------
194,307
----------
TOTAL FOREIGN COMMON STOCK (Cost $716,205) 720,249
----------
<CAPTION>
SHORT-TERM INVESTMENTS (10.7%) PAR
---------
<S> <C> <C>
Repurchase agreement with State Street Bank & Trust Company
dated 10/31/96 at 5.51% to be repurchased at $322,049 on
11/01/96. (Collateralized by $325,000 U.S. Treasury Note
6.125%, due 03/31/98. Market value of collateral is $328,656.)
(Cost $322,000) $322,000 322,000
----------
TOTAL INVESTMENTS AT VALUE (100.5%) (Cost $3,064,618*) 3,029,618
LIABILITIES IN EXCESS OF OTHER ASSETS (0.5%) (15,703)
----------
NET ASSETS (100.0%) (applicable to 305,058 Common Shares and 657
Advisor Shares) $3,013,915
----------
----------
NET ASSET VALUE, offering and redemption price per Common Share
($3,007,441[div]305,058) $9.86
-----
-----
NET ASSET VALUE, offering and redemption price per Advisor Share
($6,474[div]657) $9.85
-----
-----
</TABLE>
INVESTMENT ABBREVIATIONS
ADR = American Depository Receipt
- --------------------------------------------------------------------------------
`D' Non-income producing security.
* Also cost for Federal income tax purposes.
See Accompanying Notes to Financial Statements.
67
<PAGE>
<PAGE>
WARBURG PINCUS JAPAN OTC FUND
STATEMENT OF ASSETS AND LIABILITIES
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS
Investments at value (Cost $160,085,015) $146,739,606
Receivable for Investment sold (Cost $6,227,442) 6,244,472
Foreign currency (Cost $2,303,480) 2,299,114
Dividends, interest, and reclaims receivable (Cost $231,663) 222,242
Receivable for Fund shares sold 220,391
Deferred organizational costs 124,335
Other assets 2,382
------------
TOTAL ASSETS 155,852,542
------------
LIABILITIES
Payable for Fund shares redeemed 772,178
Accrued expenses 439,363
Payable for unrealized losses on forward contracts 179,747
------------
TOTAL LIABILITIES 1,391,288
------------
NET ASSETS applicable to 18,244,217 Common Shares outstanding and
124 Advisor Shares outstanding $154,461,254
------------
------------
NET ASSET VALUE, offering and redemption price per Common Share
($154,460,206[div]18,244,217) $8.47
-----
-----
NET ASSET VALUE, offering and redemption price per Advisor Share
($1,048[div]124) $8.45
-----
-----
</TABLE>
See Accompanying Notes to Financial Statements.
68
<PAGE>
<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
69
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
STATEMENTS OF OPERATIONS
For the Year or Period Ended October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WARBURG PINCUS
CAPITAL WARBURG PINCUS WARBURG PINCUS WARBURG PINCUS
APPRECIATION EMERGING INTERNATIONAL JAPAN OTC
FUND GROWTH FUND EQUITY FUND FUND
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividends $ 4,048,685 $ 2,197,913 $ 63,487,599 $ 1,091,426
Interest 1,347,518 4,688,594 5,393,349 226,149
Foreign taxes withheld 0 0 (8,148,896) (164,156)
-------------- -------------- -------------- --------------
Total investment income 5,396,203 6,886,507 60,732,052 1,153,419
-------------- -------------- -------------- --------------
EXPENSES:
Investment advisory 2,328,788 9,738,214 30,605,750 2,721,814
Administrative services 665,368 2,125,337 4,965,863 478,001
Audit 24,019 34,737 85,046 18,680
Custodian/Sub-custodian 102,257 322,246 2,235,561 163,753
Directors'/Trustees 10,000 10,000 10,000 6,500
Distribution 0 0 0 544,360
Insurance 8,912 19,358 69,719 5,210
Interest 0 0 533,573 16,049
Legal 55,474 109,678 270,200 41,210
Offering/Organizational costs 0 0 0 42,449
Printing 27,968 87,281 283,541 34,405
Registration 85,884 323,817 388,263 70,000
Shareholder servicing 98,516 1,373,043 2,138,703 0
Transfer agent 116,115 701,472 2,029,857 279,968
Miscellaneous 45,957 92,879 364,023 32,812
-------------- -------------- -------------- --------------
3,569,258 14,938,062 43,980,099 4,455,211
Less: fees waived and expenses
reimbursed (24,621) (79,090) (237,341) (644,668)
-------------- -------------- -------------- --------------
Total expenses 3,544,637 14,858,972 43,742,758 3,810,543
-------------- -------------- -------------- --------------
Net investment income (loss) 1,851,566 (7,972,465) 16,989,294 (2,657,124)
-------------- -------------- -------------- --------------
NET REALIZED AND UNREALIZED GAIN (LOSS)
FROM INVESTMENTS AND FOREIGN CURRENCY
RELATED ITEMS:
Net realized gain (loss) from security
transactions 45,879,867 7,182,552 101,648,594 (19,857,477)
Net realized gain (loss) from foreign
currency related items 0 0 101,555,138 28,749,231
Net change in unrealized appreciation
(depreciation) from investments and
foreign currency related items 22,240,359 128,715,987 31,834,726 (13,291,445)
-------------- -------------- -------------- --------------
Net realized and unrealized gain
(loss) from investments and foreign
currency related items 68,120,226 135,898,539 235,038,458 (4,399,691)
-------------- -------------- -------------- --------------
Net increase (decrease) in net assets
resulting from operations $ 69,971,792 $127,926,074 $252,027,752 $ (7,056,815)
-------------- -------------- -------------- --------------
-------------- -------------- -------------- --------------
</TABLE>
- --------------------------------------------------------------------------------
(1) For the period December 29, 1995 (Commencement of Operations) through
October 31, 1996.
(2) For the period September 30, 1996 (Commencement of Operations) through
October 31, 1996.
See Accompanying Notes to Financial Statements.
70
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WARBURG PINCUS
GLOBAL
WARBURG PINCUS WARBURG PINCUS WARBURG PINCUS WARBURG PINCUS POST-VENTURE
EMERGING POST-VENTURE JAPAN GROWTH SMALL COMPANY CAPITAL
MARKETS FUND CAPITAL FUND FUND(1) VALUE FUND(1) FUND(2)
-------------- -------------- -------------- -------------- --------------
<S> <C> <C> <C> <C> <C>
$ 2,736,885 $ 13,465 $ 71,549 $ 191,422 $ 605
379,287 503,273 25,480 180,000 2,343
(361,236) 0 (10,732) 0 (88)
-------------- -------------- -------------- -------------- ------
2,754,936 516,738 86,297 371,422 2,860
-------------- -------------- -------------- -------------- ------
1,789,738 1,253,423 149,987 280,663 2,470
314,994 200,548 26,398 56,132 435
12,500 18,700 12,061 12,125 15,000
448,482 94,021 7,476 27,515 6,001
7,750 7,500 10,000 7,500 1,250
357,864 250,579 29,995 70,162 494
2,194 1,503 177 332 0
6,248 0 1,227 0 0
24,215 114,670 31,074 26,476 0
44,967 30,353 79,971 43,990 6,924
17,750 30,319 30,000 13,786 3,000
135,728 108,115 22,758 40,942 8,600
167 211 0 0 0
242,236 193,206 18,241 26,123 2,000
18,126 24,145 6,202 7,831 0
-------------- -------------- -------------- -------------- ------
3,422,959 2,327,293 425,567 613,577 46,174
(1,110,936) (672,669) (215,581) (122,414) (42,913)
-------------- -------------- -------------- -------------- ------
2,312,023 1,654,624 209,986 491,163 3,261
-------------- -------------- -------------- -------------- ------
442,913 (1,137,886) (123,689) (119,741) (401)
-------------- -------------- -------------- -------------- ------
798,938 (9,967,147) (105,167) 1,349,283 (15,394)
(155,026) (7,090) 382,638 0 (421)
(10,622,287) 14,511,504 (1,162,727) 8,156,391 (35,333)
-------------- -------------- -------------- -------------- ------
(9,978,375) 4,537,267 (885,256) 9,505,674 (51,148)
-------------- -------------- -------------- -------------- ------
$ (9,535,462) $ 3,399,381 $ (1,008,945) $9,385,933 $(51,549)
-------------- -------------- -------------- -------------- ------
-------------- -------------- -------------- -------------- ------
</TABLE>
- --------------------------------------------------------------------------------
71
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WARBURG PINCUS WARBURG PINCUS WARBURG PINCUS
CAPITAL APPRECIATION FUND EMERGING GROWTH FUND INTERNATIONAL EQUITY FUND
-------------------------------- -------------------------------- --------------------------------
FOR THE YEAR ENDED OCTOBER 31, FOR THE YEAR ENDED OCTOBER 31, FOR THE YEAR ENDED OCTOBER 31,
-------------------------------- -------------------------------- --------------------------------
1996 1995 1996 1995 1996 1995
-------------- ---------------- -------------- ---------------- -------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
FROM OPERATIONS:
Net investment income
(loss) $ 1,851,566 $ 563,484 $ (7,972,465) $ (2,982,589) $ 16,989,294 $ 12,746,935
Net realized gain
(loss) from security
transactions 45,879,867 31,649,453 7,182,552 49,113,782 101,648,594 (34,444,203)
Net realized gain
(loss) from foreign
currency related
items 0 0 0 0 101,555,138 16,792,905
Net change in
unrealized
appreciation
(depreciation) from
investments and
foreign currency
related items 22,240,359 12,386,702 128,715,987 84,670,426 31,834,726 (4,675,049)
-------------- ---------------- -------------- ---------------- -------------- ----------------
Net increase
(decrease) in net
assets resulting
from operations 69,971,792 44,599,639 127,926,074 130,801,619 252,027,752 (9,579,412)
-------------- ---------------- -------------- ---------------- -------------- ----------------
FROM DISTRIBUTIONS:
Dividends from net
investment income:
Common Shares (205,824) (563,484) 0 0 (61,542,500) (11,671,023)
Advisor Shares 0 0 0 0 (8,824,069) (629,473)
Distributions from
realized gains:
Common Shares (29,718,914) (10,419,627) (29,520,521) 0 0 (42,332,078)
Advisor Shares (2,066,408) (575,892) (10,992,686) 0 0 (5,756,403)
-------------- ---------------- -------------- ---------------- -------------- ----------------
Net decrease in net
assets from
distributions (31,991,146) (11,559,003) (40,513,207) 0 (70,366,569) (60,388,977)
-------------- ---------------- -------------- ---------------- -------------- ----------------
FROM CAPITAL SHARE
TRANSACTIONS:
Proceeds from sale of
shares 200,852,137 88,963,455 1,002,644,154 335,569,078 1,465,419,751 1,383,361,959
Reinvested dividends 31,176,989 11,246,752 38,944,251 0 62,026,272 54,872,977
Net asset value of
shares redeemed (86,168,618) (53,459,471) (316,383,771) (116,280,844) (709,132,860) (715,598,203)
-------------- ---------------- -------------- ---------------- -------------- ----------------
Net increase
(decrease) in net
assets from
capital share
transactions 145,860,508 46,750,736 725,204,634 219,288,234 818,313,163 722,636,733
-------------- ---------------- -------------- ---------------- -------------- ----------------
Net increase
(decrease) in net
assets 183,841,154 79,791,372 812,617,501 350,089,853 999,974,346 652,668,344
NET ASSETS:
Beginning of period 247,305,865 167,514,493 654,762,611 304,672,758 2,385,943,847 1,733,275,503
-------------- ---------------- -------------- ---------------- -------------- ----------------
End of period $ 431,147,019 $247,305,865 $1,467,380,112 $654,762,611 $3,385,918,193 $ 2,385,943,847
-------------- ---------------- -------------- ---------------- -------------- ----------------
-------------- ---------------- -------------- ---------------- -------------- ----------------
</TABLE>
See Accompanying Notes to Financial Statements.
72
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WARBURG PINCUS WARBURG PINCUS
EMERGING MARKETS FUND POST-VENTURE CAPITAL FUND
-------------------------------------- --------------------------------------
WARBURG PINCUS FOR THE PERIOD FOR THE PERIOD
JAPAN OTC FUND DECEMBER 30, 1994 SEPTEMBER 29, 1995
-------------------------------- (COMMENCEMENT OF (COMMENCEMENT OF
FOR THE YEAR OPERATIONS) THROUGH FOR THE YEAR OPERATIONS) THROUGH
FOR THE YEAR ENDED OCTOBER 31, ENDED OCTOBER 31, OCTOBER 31, ENDED OCTOBER 31, OCTOBER 31,
-------------------------------- ----------------- ------------------- ----------------- -------------------
1996 1995 1996 1995 1996 1995
-------------- ---------------- ----------------- ------------------- ----------------- -------------------
<S> <C> <C> <C> <C> <C> <C>
$ (2,657,124) $ (73,801) $ 442,913 $ 29,534 $ (1,137,886) $ 356
(19,857,477) (4,629,196) 798,938 102,219 (9,967,147) (26,884)
28,749,231 7,895,010 (155,026) (4,992) (7,090) 0
(13,291,445) (195,368) (10,622,287) (9,058) 14,511,504 164,441
-------------- ---------------- ----------------- -------- ----------------- --------
(7,056,815) 2,996,645 (9,535,462) 117,703 3,399,381 137,913
-------------- ---------------- ----------------- -------- ----------------- --------
(8,403,581) 0 (114,242) (14,321) 0 0
(42) 0 (6) (3) 0 0
0 0 (103,802) 0 0 0
0 0 (8) 0 0 0
-------------- ---------------- ----------------- -------- ----------------- --------
(8,403,623) 0 (218,058) (14,324) 0 0
-------------- ---------------- ----------------- -------- ----------------- --------
252,768,825 200,565,875 309,206,911 7,753,908 249,245,203 2,792,403
7,560,373 0 191,486 13,802 0 0
(268,976,988) (44,871,674) (87,855,459) (1,191,160) (90,384,695) (4,887)
-------------- ---------------- ----------------- -------- ----------------- --------
(8,647,790) 155,694,201 221,542,938 6,576,550 158,860,508 2,787,516
-------------- ---------------- ----------------- -------- ----------------- --------
(24,108,228) 158,690,846 211,789,418 6,679,929 162,259,889 2,925,429
178,569,482 19,878,636 6,780,929 101,000 3,025,429 100,000
-------------- ---------------- ----------------- -------- ----------------- --------
$ 154,461,254 $178,569,482 $ 218,570,347 $ 6,780,929 $ 165,285,318 $ 3,025,429
-------------- ---------------- ----------------- -------- ----------------- --------
-------------- ---------------- ----------------- -------- ----------------- --------
</TABLE>
73
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
STATEMENTS OF CHANGES IN NET ASSETS (CONT'D)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WARBURG PINCUS
WARBURG PINCUS GLOBAL
WARBURG PINCUS SMALL COMPANY POST-VENTURE
JAPAN GROWTH FUND VALUE FUND CAPITAL FUND
----------------- ----------------- ------------------
FOR THE PERIOD FOR THE PERIOD FOR THE PERIOD
DECEMBER 29, 1995 DECEMBER 29, 1995 SEPTEMBER 30, 1996
(COMMENCEMENT (COMMENCEMENT (COMMENCEMENT
OF OPERATIONS) OF OPERATIONS) OF OPERATIONS)
THROUGH THROUGH THROUGH
OCTOBER 31, 1996 OCTOBER 31, 1996 OCTOBER 31, 1996
----------------- ----------------- ------------------
<S> <C> <C> <C>
FROM OPERATIONS:
Net investment loss $ (123,689) $ (119,741) $ (401)
Net realized gain (loss) from security
transactions (105,167) 1,349,283 (15,394)
Net realized gain (loss) from foreign
currency related items 382,638 0 (421)
Net change in unrealized appreciation
(depreciation) from investments and
foreign currency related items (1,162,727) 8,156,391 (35,333)
----------------- ----------------- --------
Net increase (decrease) in net assets
resulting from operations (1,008,945) 9,385,933 (51,549)
----------------- ----------------- --------
FROM CAPITAL SHARE TRANSACTIONS:
Proceeds from sale of shares 33,728,391 85,549,967 2,972,288
Reinvested dividends 0 0 0
Net asset value of shares redeemed (12,660,997) (10,985,933) (6,824)
----------------- ----------------- --------
Net increase in net assets from capital
share transactions 21,067,394 74,564,034 2,965,464
----------------- ----------------- --------
Net increase in net assets 20,058,449 83,949,967 2,913,915
NET ASSETS:
Beginning of period 100,000 100,000 100,000
----------------- ----------------- --------
End of period $ 20,158,449 $ 84,049,967 $3,013,915
----------------- ----------------- --------
----------------- ----------------- --------
</TABLE>
See Accompanying Notes to Financial Statements.
74
<PAGE>
<PAGE>
WARBURG PINCUS CAPITAL APPRECIATION FUND
FINANCIAL HIGHLIGHTS
(For an Advisor Share of the Fund Outstanding Throughout Each Year)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CAPITAL APPRECIATION FUND
-----------------------------------------------
ADVISOR SHARES
-----------------------------------------------
FOR THE YEAR ENDED OCTOBER 31,
-----------------------------------------------
1996 1995 1994 1993 1992
------- ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF YEAR $ 16.26 $14.22 $15.28 $13.28 $12.16
------- ------ ------ ------ ------
Income from Investment Operations:
Net Investment Income (Loss) .02 .00 (.08) .00 (.01)
Net Gain on Securities (both realized and unrealized) 3.49 3.02 .23 2.76 1.20
------- ------ ------ ------ ------
Total from Investment Operations 3.51 3.02 .15 2.76 1.19
------- ------ ------ ------ ------
Less Distributions:
Dividends from Net Investment Income .00 .00 (.02) .00 (.02)
Distributions from Capital Gains (2.04) (.98) (1.19) (.76) (.05)
------- ------ ------ ------ ------
Total Distributions (2.04) (.98) (1.21) (.76) (.07)
------- ------ ------ ------ ------
NET ASSET VALUE, END OF YEAR $ 17.73 $16.26 $14.22 $15.28 $13.28
------- ------ ------ ------ ------
------- ------ ------ ------ ------
Total Return 24.15% 23.41% 1.23% 21.64% 9.83%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Year (000s) $23,440 $11,594 $8,169 $10,437 $1,655
Ratios to average daily net assets:
Operating expenses 1.53% 1.62% 1.55% 1.51% 1.56%
Net investment income (loss) .09% (.18%) (.24%) (.25%) (.11%)
Decrease reflected in above operating expense ratios
due to waivers/reimbursements .00% .00% .01% .00% .01%
Portfolio Turnover Rate 170.69% 146.09% 51.87% 48.26% 55.83%
Average Commission Rate # $.0595 -- -- -- --
</TABLE>
- --------------------------------------------------------------------------------
# Computed by dividing the total amount of commissions paid by the total number
of shares purchased and sold during the period for which there was a
commission charged.
See Accompanying Notes to Financial Statements.
TAX STATUS OF 1996 DIVIDENDS (Unaudited)
Taxable dividends paid by the Fund on a per share basis were as follows:
Ordinary income $ .87
Long-term capital gain 1.17
Ordinary income dividends qualifying for the dividends received deduction
available to corporate shareholders was 29.58%.
Because the Fund's fiscal year is not the calendar year, amounts to be used by
calendar year taxpayers on their Federal return will be reflected on Form
1099-DIV and will be mailed in January 1997.
75
<PAGE>
<PAGE>
WARBURG PINCUS EMERGING GROWTH FUND
FINANCIAL HIGHLIGHTS
(For an Advisor Share of the Fund Outstanding Throughout Each Year)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
EMERGING GROWTH FUND
--------------------------------------------------
ADVISOR SHARES
--------------------------------------------------
FOR THE YEAR ENDED OCTOBER 31,
--------------------------------------------------
1996 1995 1994 1993 1992
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF YEAR $29.38 $22.05 $23.51 $18.19 $16.99
------ ------ ------ ------ ------
Income from Investment Operations:
Net Investment Loss (.09) (.09) (.08) (.08) (.06)
Net Gain (Loss) on Securities (both realized
and
unrealized) 4.45 7.42 (.02) 5.77 1.62
------ ------ ------ ------ ------
Total from Investment Operations 4.36 7.33 (.10) 5.69 1.56
------ ------ ------ ------ ------
Less Distributions:
Dividends from Net Investment Income .00 .00 .00 .00 .00
Distributions from Capital Gains (1.75) .00 (1.36) (.37) (.36)
------ ------ ------ ------ ------
Total Distributions (1.75) .00 (1.36) (.37) (.36)
------ ------ ------ ------ ------
NET ASSET VALUE, END OF YEAR $31.99 $29.38 $22.05 $23.51 $18.19
------ ------ ------ ------ ------
------ ------ ------ ------ ------
Total Return 15.69% 33.24% (.29%) 31.67% 9.02%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Year (000s) $362,696 $167,225 $64,009 $26,029 $5,398
Ratios to average daily net assets:
Operating expenses 1.69% 1.76% 1.72% 1.73% 1.74%
Net investment loss (1.05%) (1.08%) (1.08%) (1.09%) (.87%)
Decrease reflected in above operating expense
ratios due to waivers/reimbursements .00% .00% .04% .00% .06%
Portfolio Turnover Rate 65.77% 84.82% 60.38% 68.35% 63.38%
Average Commission Rate # $.0567 -- -- -- --
</TABLE>
- --------------------------------------------------------------------------------
# Computed by dividing the total amount of commissions paid by the total number
of shares purchased and sold during the period for which there was a
commission charged.
See Accompanying Notes to Financial Statements.
TAX STATUS OF 1996 DIVIDENDS (Unaudited)
Taxable dividends paid by the Fund on a per share basis were as follows:
Ordinary income $.38
Long-term capital gain 1.37
Ordinary income dividends qualifying for the dividends received deduction
available to corporate shareholders was 25.21%.
Because the Fund's fiscal year is not the calendar year, amounts to be used by
calendar year taxpayers on their Federal return will be reflected on Form
1099-DIV and will be mailed in January 1997.
76
<PAGE>
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
FINANCIAL HIGHLIGHTS
(For an Advisor Share of the Fund Outstanding Throughout Each Year)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY FUND
--------------------------------------------------
ADVISOR SHARES
--------------------------------------------------
FOR THE YEAR ENDED OCTOBER 31,
--------------------------------------------------
1996 1995 1994 1993 1992
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF YEAR $19.16 $20.38 $16.91 $12.20 $13.66
------ ------ ------ ------ ------
Income from Investment Operations:
Net Investment Income (Loss) .18 .03 .16 (.01) .13
Net Gain (Loss) on Securities and Foreign
Currency
Related Items (both realized and unrealized) 1.68 (.67) 3.35 4.86 (1.32)
------ ------ ------ ------ ------
Total from Investment Operations 1.86 (.64) 3.51 4.85 (1.19)
------ ------ ------ ------ ------
Less Distributions:
Dividends from Net Investment Income (.52) (.05) .00 (.01) (.12)
Distributions from Capital Gains .00 (.53) (.04) (.13) (.15)
------ ------ ------ ------ ------
Total Distributions (.52) (.58) (.04) (.14) (.27)
------ ------ ------ ------ ------
NET ASSET VALUE, END OF YEAR $20.50 $19.16 $20.38 $16.91 $12.20
------ ------ ------ ------ ------
------ ------ ------ ------ ------
Total Return 9.89% (3.04%) 20.77% 40.06% (8.86%)
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Year (000s) $500,465 $317,736 $199,404 $44,244 $1,472
Ratios to average daily net assets:
Operating expenses 1.80% 1.89% 1.94% 2.00% 2.00%
Net investment income (loss) .18% .20% (.29%) (.36%) .54%
Decrease reflected in above operating expense
ratios due to waivers/reimbursements .01% .00% .00% .00% .07%
Portfolio Turnover Rate 32.49% 32.49% 17.02% 22.60% 53.29%
Average Commission Rate # $.0170 -- -- -- --
</TABLE>
- --------------------------------------------------------------------------------
# Computed by dividing the total amount of commissions paid by the total number
of shares purchased and sold during the period for which there was a
commission charged.
See Accompanying Notes to Financial Statements.
TAX STATUS OF 1996 DIVIDENDS (Unaudited)
Taxable dividends paid by the Fund on a per share basis were as follows:
Ordinary income $.52
Because the Fund's fiscal year is not the calendar year, amounts to be used by
calendar year taxpayers on their Federal return will be reflected on Form
1099-DIV and will be mailed in January 1997.
77
<PAGE>
<PAGE>
WARBURG PINCUS JAPAN OTC FUND
FINANCIAL HIGHLIGHTS
(For an Advisor Share of the Fund Outstanding Throughout Each Period)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
JAPAN OTC FUND
------------------------------------------------------------
ADVISOR SHARES
------------------------------------------------------------
FOR THE PERIOD
SEPTEMBER 30, 1994
(COMMENCEMENT OF
FOR THE YEAR ENDED OCTOBER 31, OPERATIONS)
------------------------------------ THROUGH
1996 1995 OCTOBER 31, 1994
-------------- ---------------- ------------------
<S> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $9.08 $9.85 $10.00
----- ----- -----
Income from Investment Operations:
Net Investment Loss (.13) (.02) .00
Net Loss on Securities and Foreign
Currency Related Items (both realized
and unrealized) (.14) (.75) (.15)
----- ----- -----
Total from Investment Operations (.27) (.77) (.15)
----- ----- -----
Less Distributions:
Dividends from Net Investment Income (.36) .00 .00
Distributions from Capital Gains .00 .00 .00
----- ----- -----
Total Distributions (.36) .00 .00
----- ----- -----
NET ASSET VALUE, END OF PERIOD $ 8.45 $ 9.08 $ 9.85
----- ----- -----
----- ----- -----
Total Return (3.17%) (7.82%) (1.50%)`D'
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (000s) $1 $1 $1
Ratios to average daily net assets:
Operating expenses 2.00% 1.31% 1.18%*
Net investment income (loss) (1.57%) (.19%) .12%*
Decrease reflected in above operating expense
ratios due to waivers/reimbursements .29% 1.83% 4.74%*
Portfolio Turnover Rate 95.23% 82.98% .00%
Average Commission Rate # $.0968 -- --
</TABLE>
- --------------------------------------------------------------------------------
`D' Non-annualized
* Annualized
# Computed by dividing the total amount of commissions paid by the total number
of shares purchased and sold during the period for which there was a
commission charged.
See Accompanying Notes to Financial Statements.
TAX STATUS OF 1996 DIVIDENDS (Unaudited)
Taxable dividends paid by the Fund on a per share basis were as follows:
Ordinary income $.36
Because the Fund's fiscal year is not the calendar year, amounts to be used by
calendar year taxpayers on their Federal return will be reflected on Form
1099-DIV and will be mailed in January 1997.
78
<PAGE>
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
FINANCIAL HIGHLIGHTS
(For an Advisor Share of the Fund Outstanding Throughout Each Period)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
EMERGING MARKETS FUND
----------------------------------------
ADVISOR SHARES
----------------------------------------
DECEMBER 30, 1994
FOR THE (COMMENCEMENT OF
YEAR ENDED OPERATIONS) THROUGH
OCTOBER 31, 1996 OCTOBER 31, 1995
---------------- -------------------
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $11.30 $ 10.00
----- -----
Income from Investment Operations:
Net Investment Income (Loss) (.08) .14
Net Gain on Securities and Foreign Currency Related Items
(both realized and unrealized) 1.11 1.19
----- -----
Total from Investment Operations 1.03 1.33
----- -----
Less Distributions:
Dividends from Net Investment Income (.05) (.03)
Distributions from Capital Gains (.07) .00
----- -----
Total Distributions (.12) (.03)
----- -----
NET ASSET VALUE, END OF PERIOD $12.21 $ 11.30
----- -----
----- -----
Total Return 9.20% 13.29%`D'
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (000s) $149 $1
Ratios to average daily net assets:
Operating expenses 1.90% 1.22%*
Net investment income (loss) (.57%) 1.76%*
Decrease reflected in above operating expense ratios due
to waivers/reimbursements .65% 16.36%*
Portfolio Turnover Rate 61.84% 57.76%`D'
Average Commission Rate # $.0135 --
</TABLE>
- --------------------------------------------------------------------------------
`D' Non-annualized
* Annualized
# Computed by dividing the total amount of commissions paid by the total number
of shares purchased and sold during the period for which there was a
commission charged.
See Accompanying Notes to Financial Statements.
TAX STATUS OF 1996 DIVIDENDS (Unaudited)
Taxable dividends paid by the Fund on a per share basis were as follows:
Ordinary income $.12
Because the Fund's fiscal year is not the calendar year, amounts to be used by
calendar year taxpayers on their Federal return will be reflected on Form
1099-DIV and will be mailed in January 1997.
79
<PAGE>
<PAGE>
WARBURG PINCUS POST-VENTURE CAPITAL FUND
FINANCIAL HIGHLIGHTS
(For an Advisor Share of the Fund Outstanding Throughout Each Period)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
POST-VENTURE CAPITAL FUND
---------------------------------------
ADVISOR SHARES
---------------------------------------
FOR THE PERIOD
SEPTEMBER 29, 1995
(COMMENCEMENT OF
FOR THE OPERATIONS)
YEAR ENDED THROUGH
OCTOBER 31, 1996 OCTOBER 31, 1995
---------------- ------------------
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $10.68 $10.00
----- -----
Income from Investment Operations:
Net Investment Loss (.05) .00
Net Gain on Securities and Foreign Currency Related
Items both (realized and unrealized) 5.30 .68
----- -----
Total from Investment Operations 5.25 .68
----- -----
Less Distributions:
Dividends from Net Investment Income .00 .00
Distributions from Capital Gains .00 .00
----- -----
Total Distributions .00 .00
----- -----
NET ASSET VALUE, END OF PERIOD $15.93 $10.68
----- -----
----- -----
Total Return 49.16% 6.80%`D'
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (000s) $204 $1
Ratios to average daily net assets:
Operating expenses 1.90% 2.15%*
Net investment income (loss) (1.41%) .09%*
Decrease reflected in above operating expense ratios due
to waivers/reimbursements .75% 9.25%*
Portfolio Turnover Rate 168.46% 16.90%`D'
Average Commission Rate # $.0529 --
</TABLE>
- --------------------------------------------------------------------------------
`D' Non-annualized
* Annualized
# Computed by dividing the total amount of commissions paid by the total number
of shares purchased and sold during the period for which there was a
commission charged.
See Accompanying Notes to Financial Statements.
80
<PAGE>
<PAGE>
WARBURG PINCUS JAPAN GROWTH FUND
FINANCIAL HIGHLIGHTS
(For an Advisor Share of the Fund Outstanding Throughout the Period)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
JAPAN GROWTH FUND
-------------------
ADVISOR SHARES
-------------------
DECEMBER 29, 1995
(COMMENCEMENT OF
OPERATIONS) THROUGH
OCTOBER 31, 1996
-------------------
<S> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.00
-----
Income from Investment Operations:
Net Investment Loss (.09)
Net Loss on Securities and Foreign Currency Related Items (both
realized and unrealized) (.08)
-----
Total from Investment Operations (.17)
-----
Less Distributions:
Dividends from Net Investment Income .00
Distributions from Capital Gains .00
-----
Total Distributions .00
-----
NET ASSET VALUE, END OF PERIOD $ 9.83
-----
-----
Total Return (1.70%)`D'
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (000s) $1
Ratios to average daily net assets:
Operating expenses 2.00%*
Net investment loss (1.08%)*
Decrease reflected in above operating expense ratio due to
waivers/reimbursements 3.43%*
Portfolio Turnover Rate 51.72%`D'
Average Commission Rate # $.0717
</TABLE>
- --------------------------------------------------------------------------------
`D' Non-annualized
* Annualized
# Computed by dividing the total amount of commissions paid by the total number
of shares purchased and sold during the period for which there was a
commission charged.
See Accompanying Notes to Financial Statements.
81
<PAGE>
<PAGE>
WARBURG PINCUS SMALL COMPANY VALUE FUND
FINANCIAL HIGHLIGHTS
(For an Advisor Share of the Fund Outstanding Throughout the Period)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SMALL COMPANY VALUE FUND
------------------------
ADVISOR SHARES
------------------------
DECEMBER 29, 1995
(COMMENCEMENT OF
OPERATIONS) THROUGH
OCTOBER 31, 1996
------------------------
<S> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $10.00
-----
Income from Investment Operations:
Net Investment Loss (.02)
Net Gain on Securities (both realized and unrealized) 4.48
-----
Total from Investment Operations 4.46
-----
Less Distributions:
Dividends from Net Investment Income .00
Distributions from Capital Gains .00
-----
Total Distributions .00
-----
NET ASSET VALUE, END OF PERIOD $14.46
-----
-----
Total Return 44.60%`D'
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (000s) $5
Ratios to average daily net assets:
Operating expenses 1.97%*
Net investment loss (.52%)*
Decrease reflected in above operating expense ratio due to
waivers/reimbursements 1.46%*
Portfolio Turnover Rate 43.14%`D'
Average Commission Rate # $.0570
</TABLE>
- --------------------------------------------------------------------------------
`D' Non-annualized
* Annualized
# Computed by dividing the total amount of commissions paid by the total number
of shares purchased and sold during the period for which there was a
commission charged.
See Accompanying Notes to Financial Statements.
82
<PAGE>
<PAGE>
WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND
FINANCIAL HIGHLIGHTS
(For an Advisor Share of the Fund Outstanding Throughout the Period)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GLOBAL POST-VENTURE CAPITAL FUND
--------------------------------
ADVISOR SHARES
--------------------------------
SEPTEMBER 30, 1996
(COMMENCEMENT OF
OPERATIONS) THROUGH
OCTOBER 31, 1996
--------------------------------
<S> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $10.00
-----
Income from Investment Operations:
Net Investment Income .00
Net Loss on Securities and Foreign Currecy Related Items (both
realized and unrealized) (.15)
-----
Total from Investment Operations (.15)
-----
Less Distributions:
Dividends from Net Investment Income .00
Distributions from Capital Gains .00
-----
Total Distributions
NET ASSET VALUE, END OF PERIOD $ 9.85
-----
-----
Total Return (1.50%)`D'
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (000s) $6
Ratios to average daily net assets:
Operating expenses 1.90%*
Net investment loss (.78%)*
Decrease reflected in above operating expense ratio due to
waivers/reimbursements 22.23%*
Portfolio Turnover Rate 5.85%`D'
Average Commission Rate # $.0323
</TABLE>
- --------------------------------------------------------------------------------
`D' Non-annualized
* Annualized
# Computed by dividing the total amount of commissions paid by the total number
of shares purchased and sold during the period for which there was a
commission charged.
See Accompanying Notes to Financial Statements.
83
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS
October 31, 1996
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
The Warburg Pincus Equity Funds (the 'Funds') are comprised of Warburg Pincus
Capital Appreciation Fund (the 'Capital Appreciation Fund'), Warburg Pincus
International Equity Fund (the 'International Equity Fund'), Warburg Pincus
Post-Venture Capital Fund (the 'Post-Venture Capital Fund'), Warburg Pincus
Small Company Value Fund (the 'Small Company Value Fund') and the Warburg Pincus
Global Post-Venture Capital Fund (the 'Global Post-Venture Capital Fund') which
are registered under the Investment Company Act of 1940, as amended (the '1940
Act'), as diversified, open-end management investment companies, and Warburg
Pincus Emerging Growth Fund (the 'Emerging Growth Fund'), Warburg Pincus Japan
OTC Fund (the 'Japan OTC Fund'), Warburg Pincus Emerging Markets Fund (the
'Emerging Markets Fund') and Warburg Pincus Japan Growth Fund (the 'Japan Growth
Fund') which are registered under the 1940 Act as non-diversified, open-end
management investment companies.
Investment objectives for each Fund are as follows: the Capital Appreciation
Fund, the International Equity Fund, the Japan OTC Fund and the Small Company
Value Fund seek long-term capital appreciation; the Emerging Growth Fund seeks
maximum capital appreciation; the Emerging Markets Fund seeks growth of capital;
the Post-Venture Capital Fund, the Japan Growth Fund and the Global Post-Venture
Capital Fund seek long-term growth of capital.
Each Fund offers two classes of shares, one class being referred to as Common
Shares and one class being referred to as Advisor Shares. Common and Advisor
Shares in each Fund represent an equal pro rata interest in such Fund, except
that they bear different expenses which reflect the difference in the range of
services provided to them. Common Shares for the Japan OTC Fund, the Emerging
Markets Fund, the Post-Venture Capital Fund, the Japan Growth Fund, the Small
Company Value Fund and the Global Post-Venture Capital Fund bear expenses paid
pursuant to a shareholder servicing and distribution plan adopted by each Fund
at an annual rate not to exceed .25% of the average daily net asset value of
each Fund's outstanding Common Shares. Advisor Shares for each Fund bear
expenses paid pursuant to a distribution plan adopted by each Fund at an annual
rate not to exceed .75% of the average daily net asset value of each Fund's
outstanding Advisor Shares. Advisor Shares are currently bearing expenses of
.50% of average daily net assets.
The net asset value of each Fund is determined daily as of the close of
regular trading on the New York Stock Exchange. Each Fund's investments are
valued at market value, which is currently determined using the last reported
sales price. If no sales are reported, investments are generally valued at the
last reported mean price. In the absence of market quotations, investments are
generally valued at fair value as determined by or under the direction of the
Fund's governing Board.
84
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
Short-term investments that mature in 60 days or less are valued on the basis of
amortized cost, which approximates market value.
The books and records of the Funds are maintained in U.S. dollars.
Transactions denominated in foreign currencies are recorded at the current
prevailing exchange rates. All assets and liabilities denominated in foreign
currencies are translated into U.S. dollar amounts at the current exchange rate
at the end of the period. Translation gains or losses resulting from changes in
the exchange rate during the reporting period and realized gains and losses on
the settlement of foreign currency transactions are reported in the results of
operations for the current period. The Funds do not isolate that portion of
gains and losses on investments in equity securities which are due to changes in
the foreign exchange rate from that which are due to changes in market prices of
equity securities. The Funds isolate that portion of gains and losses on
investments in debt securities which are due to changes in the foreign exchange
rate from that which are due to changes in market prices of debt securities.
Security transactions are accounted for on a trade date basis. Interest
income is recorded on the accrual basis. Dividends are recorded on the
ex-dividend date. Income, expenses (excluding class-specific expenses,
principally distribution, shareholder servicing fees and transfer agent fees)
and realized/unrealized gains/losses are allocated proportionately to each class
of shares based upon the relative net asset value of outstanding shares. The
cost of investments sold is determined by use of the specific identification
method for both financial reporting and income tax purposes.
Dividends from net investment income and distributions of net realized
capital gains, if any, are declared and paid annually for all Funds. However, to
the extent that a net realized capital gain can be reduced by a capital loss
carryover, such gain will not be distributed. Income and capital gain
distributions are determined in accordance with Federal income tax regulations
which may differ from generally accepted accounting principles.
No provision is made for Federal taxes as it is each Fund's intention to
continue to qualify for and elect the tax treatment applicable to regulated
investment companies under the Internal Revenue Code and make the requisite
distributions to its shareholders which will be sufficient to relieve it from
Federal income and excise taxes.
Costs incurred by the Japan OTC Fund, the Emerging Markets Fund, the
Post-Venture Capital Fund, the Japan Growth Fund, the Small Company Value Fund
and the Global Post-Venture Capital Fund in connection with their organization
have been deferred and are being amortized over a period of five years from the
date each Fund commenced its operations. Costs incurred by the Japan Growth
Fund, the Small Company Value Fund and the Global Post-Venture Capital Fund in
connection with the offering of their shares have
85
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES (CONT'D)
been deferred and are being amortized over a one year period from the date each
Fund commenced its operations.
Each Fund may enter into repurchase agreement transactions. Under the terms
of a typical repurchase agreement, a Fund acquires an underlying security
subject to an obligation of the seller to repurchase. The value of the
underlying security collateral will be maintained at an amount at least equal to
the total amount of the purchase obligation, including interest. The collateral
is in the Fund's possession.
The Funds, together with other Warburg-advised funds (collectively the
'Warburg Funds'), have established committed and uncommitted line of credit
facilities with certain banks for temporary or emergency purposes primarily
relating to fund share redemptions and funding payments of dividend or capital
gain distributions. Under the terms of the committed line of credit, the Warburg
Funds with access to the facility pay a commitment fee at a rate of .10% per
annum on the amount of the line of credit. In addition, under the terms of both
the committed and uncommitted facilities, the Warburg Funds will pay interest on
borrowings at the banks base rate plus .55%. Aggregate borrowings for each fund
under these credit facilities may not exceed the lower of (a) the maximum amount
permitted by such fund's investment policies and restrictions or (b) thirty
three and one-third percent (33 1/3%) of such fund's total assets. At October
31, 1996 there were no outstanding balances under these line of credit
facilities for any of the funds.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses during
the reporting period. Actual results could differ from these estimates.
The Funds have an arrangement with their transfer agent whereby interest
earned on uninvested cash balances was used to offset a portion of the transfer
agent expense. For the period or year ended October 31, 1996, the Funds received
credits or reimbursements under this arrangement as follows:
<TABLE>
<CAPTION>
FUND AMOUNT
- ----------------------------------------------------------------------- --------
<S> <C>
Capital Appreciation $ 24,621
Emerging Growth 79,090
International Equity 237,341
Japan OTC 17,092
Emerging Markets 8,575
Post-Venture Capital 5,930
Japan Growth 629
Small Company Value 1,372
</TABLE>
86
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
2. INVESTMENT ADVISER, CO-ADMINISTRATORS AND DISTRIBUTOR
Warburg, Pincus Counsellors, Inc. ('Warburg'), a wholly owned subsidiary of
Warburg, Pincus Counsellors G.P. ('Counsellors G.P.'), serves as each Fund's
investment adviser. For its investment advisory services, Warburg receives the
following fees based on each Fund's average daily net assets:
<TABLE>
<CAPTION>
FUND ANNUAL RATE
- ------------------------------------------------------- -----------------------------------
<S> <C>
Capital Appreciation .70% of average daily net assets
Emerging Growth .90% of average daily net assets
International Equity 1.00% of average daily net assets
Japan OTC 1.25% of average daily net assets
Emerging Markets 1.25% of average daily net assets
Post-Venture Capital 1.25% of average daily net assets
Japan Growth 1.25% of average daily net assets
Small Company Value 1.00% of average daily net assets
Global Post-Venture Capital 1.25% of average daily net assets
</TABLE>
For the period or year ended October 31, 1996, investment advisory fees,
waivers and reimbursements were as follows:
<TABLE>
<CAPTION>
GROSS NET EXPENSE
FUND ADVISORY FEE WAIVER ADVISORY FEE REIMBURSEMENTS
- ------------------------------- ------------ ------------ ------------ --------------
<S> <C> <C> <C> <C>
Capital Appreciation $ 2,323,788 $ 0 $ 2,323,788 $ 0
Emerging Growth 9,738,214 0 9,738,214 0
International Equity 30,605,750 0 30,605,750 0
Japan OTC 2,721,814 (573,600) 2,148,214 0
Emerging Markets 1,789,738 (1,031,252) 758,486 0
Post-Venture Capital 1,253,423 (634,122) 619,301 0
Japan Growth 149,987 (149,987) 0 (53,321)
Small Company Value 280,663 (115,171) 165,492 0
Global Post-Venture Capital 2,470 (2,470) 0 (40,206)
</TABLE>
SPARX Investment & Research, USA, Inc. ('SPARX USA') serves as sub-investment
adviser for the Japan OTC Fund. From its investment advisory fee, Warburg pays
SPARX USA a fee at an annual rate of .625% of the average daily net assets of
the Japan OTC Fund. No compensation is paid by the Japan OTC Fund to SPARX USA
for its sub-investment advisory services.
Abbott Capital Management, L.P. ('Abbott') serves as sub-investment adviser
for the Post-Venture Capital Fund and the Global Post-Venture Fund's assets
invested in U.S. or foreign private limited partnerships or other investment
funds ('Private Fund Investments'). From its investment advisory fee, Warburg
pays Abbott a fee of .55% per annum of the value of Private Fund Investments as
of the end of each calendar quarter. No compensation is paid by the Post-Venture
Capital Fund or the Global Post-Venture Capital Fund to Abbott for its
sub-investment advisory services.
87
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
2. INVESTMENT ADVISER, CO-ADMINISTRATORS AND DISTRIBUTOR (CONT'D)
Counsellors Funds Service, Inc. ('CFSI'), a wholly owned subsidiary of
Warburg, and PFPC Inc. ('PFPC'), an indirect, wholly owned subsidiary of PNC
Bank Corp. ('PNC'), serve as each Fund's co-administrators. For its
administrative services, CFSI currently receives a fee calculated at an annual
rate of .10% of each Fund's average daily net assets. For the year or period
ended October 31, 1996, administrative services fees earned by CFSI were as
follows:
<TABLE>
<CAPTION>
FUND CO-ADMINISTRATION FEE
- -------------------------------------------------------- ------------------------------
<S> <C>
Capital Appreciation $ 332,684
Emerging Growth 1,082,024
International Equity 3,060,575
Japan OTC 217,745
Emerging Markets 143,179
Post-Venture Capital 100,274
Japan Growth 11,999
Small Company Value 28,066
Global Post-Venture Capital 198
</TABLE>
For its administrative services for the Capital Appreciation Fund, the
Emerging Growth Fund, the Post-Venture Capital Fund and the Small Company Value
Company Fund, PFPC currently receives a fee calculated at an annual rate of .10%
on each Fund's first $500 million in average daily net assets, a .075% on the
next $1 billion in average daily net assets and .05% of average daily net assets
in excess of $1.5 billion. For the International Equity Fund, the Japan OTC
Fund, the Emerging Markets Fund, the Japan Growth Fund and the Global Post-
Venture Capital Fund, PFPC currently receives a fee calculated at an annual rate
of .12% on each Fund's first $250 million in average daily net assets, .10% on
the next $250 million in average daily net assets, .08% on the next $250 million
in average daily net assets, and .05% of the average daily net assets over $750
million.
For the period or year ended October 31, 1996, administrative service fees
earned and waived by PFPC were as follows:
<TABLE>
<CAPTION>
NET
FUND CO-ADMINISTRATION FEE WAIVER CO-ADMINISTRATION FEE
- --------------------------------- --------------------- -------- -------------------------
<S> <C> <C> <C>
Capital Appreciation $ 332,684 $ 0 $ 332,684
Emerging Growth 1,043,313 0 1,043,313
International Equity 1,905,288 0 1,905,288
Japan OTC 260,256 (53,976) 206,280
Emerging Markets 171,815 (71,109) 100,706
Post-Venture Capital 100,274 (32,617) 67,657
Japan Growth 14,399 (11,644) 2,755
Small Company Value 28,066 (5,871) 22,195
Global Post-Venture Capital 237 (237) 0
</TABLE>
Counsellors Securities Inc. ('CSI'), also a wholly owned subsidiary of
Warburg, serves as each Fund's distributor. No compensation is paid by the
Capital Appreciation Fund, the Emerging Growth Fund or the International
88
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
Equity Fund to CSI for distribution services. For its shareholder servicing and
distribution services, CSI currently receives a fee calculated at an annual rate
of .25% of the average daily net assets of the Common Shares for the Japan OTC
Fund, the Emerging Markets Fund, the Post-Venture Capital Fund, the Japan Growth
Fund, the Small Company Value Fund and the Global Post-Venture Capital Fund
pursuant to a shareholder servicing and distribution plan adopted by each Fund.
For the period or year ended October 31, 1996, distribution fees earned by CSI
were as follows:
<TABLE>
<CAPTION>
FUND DISTRIBUTION FEE
- ---------------------------------- ------------------------------
<S> <C>
Japan OTC $544,360
Emerging Markets 357,864
Post-Venture Capital 250,579
Japan Growth 29,995
Small Company Value 70,162
Global Post-Venture Capital 494
</TABLE>
3. INVESTMENTS IN SECURITIES
For the period or year ended October 31, 1996, purchases and sales of
investment securities (excluding short-term investments) were as follows:
<TABLE>
<CAPTION>
FUND PURCHASES SALES
- ------------------------------------------------------ -------------- ------------
<S> <C> <C>
Capital Appreciation $ 627,413,925 $525,813,648
Emerging Growth 1,309,424,463 657,665,206
International Equity 1,772,045,717 939,875,601
Japan OTC 203,245,710 188,602,691
Emerging Markets 300,136,788 83,042,618
Post-Venture Capital 295,511,387 150,946,644
Japan Growth 29,001,916 6,935,993
Small Company Value 81,465,584 13,335,216
Global Post-Venture Capital 2,837,188 79,176
</TABLE>
At October 31, 1996, the net unrealized appreciation from investments for
those securities having an excess of value over cost and net unrealized
depreciation from investments for those securities having an excess of cost over
value (based on cost for Federal income tax purposes) was as follows:
<TABLE>
<CAPTION>
NET UNREALIZED
UNREALIZED UNREALIZED APPRECIATION
FUND APPRECIATION DEPRECIATION (DEPRECIATION)
- --------------------------------- ------------ -------------- --------------
<S> <C> <C> <C>
Capital Appreciation $ 67,937,018 $ (4,189,292) $ 63,747,726
Emerging Growth 303,219,064 (43,093,099) 260,125,965
International Equity 410,959,328 (246,128,459) 164,830,869
Japan OTC 6,590,182 (19,935,591) (13,345,409)
Emerging Markets 13,196,008 (23,899,667) (10,703,659)
Post-Venture Capital 22,420,860 (8,564,851) 13,856,009
Japan Growth 366,434 (1,724,316) (1,357,882)
Small Company Value 9,431,925 (1,275,534) 8,156,391
Global Post-Venture Capital 91,009 (126,009) (35,000)
</TABLE>
89
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
3. INVESTMENTS IN SECURITIES (CONT'D)
For the year ended October 31, 1996, sales of the Emerging Growth Fund
included $24,910,031 of investment securities delivered to shareholders in
exchange for 729,399 Common Shares resulting in a gain of $7,807,518.
4. FORWARD FOREIGN CURRENCY CONTRACTS
The International Equity Fund, the Japan OTC Fund, the Emerging Markets Fund,
the Post-Venture Capital Fund, the Japan Growth Fund, the Small Company Value
Fund and the Global Post-Venture Capital Fund may enter into forward currency
contracts for the purchase or sale of a specific foreign currency at a fixed
price on a future date. Risks may arise upon entering into these contracts from
the potential inability of counterparties to meet the terms of their contracts
and from unanticipated movements in the value of a foreign currency relative to
the U.S. dollar. The Funds will enter into forward contracts primarily for
hedging purposes. The forward currency contracts are adjusted by the daily
exchange rate of the underlying currency and any gains or losses are recorded
for financial statement purposes as unrealized until the contract settlement
date.
At October 31, 1996, the International Equity Fund, the Japan OTC Fund and
the Japan Growth Fund had the following open forward foreign currency contracts:
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY FUND
- ---------------------------------------------------------------------------------------------------
FORWARD FOREIGN UNREALIZED
CURRENCY EXPIRATION CURRENCY CONTRACT CONTRACT FOREIGN EXCHANGE
CONTRACT DATE TO BE SOLD AMOUNT VALUE GAIN/(LOSS)
- ----------- ----------- -------------- ------------ ------------ ----------------
<S> <C> <C> <C> <C> <C>
French
Francs 03/05/97 772,070,000 $141,983,246 $142,316,258 $ (333,012)
German
Marks 04/02/97 284,944,338 189,000,000 190,153,045 (1,153,045)
Japanese
Yen 10/24/97 23,571,086,000 220,000,000 218,046,680 1,953,320
Japanese
Yen 10/24/97 21,455,200,000 200,000,000 198,473,466 1,526,534
Japanese
Yen 10/24/97 19,295,820,000 180,000,000 178,497,906 1,502,094
------------ ------------ ----------------
$930,983,246 $927,487,355 $ 3,495,891
------------ ------------ ----------------
------------ ------------ ----------------
</TABLE>
<TABLE>
<CAPTION>
JAPAN OTC FUND
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
FORWARD FOREIGN UNREALIZED
CURRENCY EXPIRATION CURRENCY CONTRACT CONTRACT FOREIGN EXCHANGE
CONTRACT DATE TO BE SOLD AMOUNT VALUE GAIN/(LOSS)
- ----------- ----------- -------------- ------------ ------------ ----------------
Japanese
Yen 11/29/96 17,006,775,000 $150,000,000 $150,179,747 $ (179,747)
------------ ------------ -------
------------ ------------ -------
</TABLE>
<TABLE>
<CAPTION>
JAPAN GROWTH FUND
- ------------------------------------------------------------------------------------------------
FORWARD FOREIGN UNREALIZED
CURRENCY EXPIRATION CURRENCY CONTRACT CONTRACT FOREIGN EXCHANGE
CONTRACT DATE TO BE SOLD AMOUNT VALUE GAIN/(LOSS)
- ----------- ----------- ------------- ----------- ----------- ----------------
<S> <C> <C> <C> <C> <C>
Japanese
Yen 10/24/97 2,142,826,000 $20,000,000 $19,822,627 $177,373
----------- ----------- -------
----------- ----------- -------
</TABLE>
90
<PAGE>
<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
91
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
5. CAPITAL SHARE TRANSACTIONS
The Capital Appreciation Fund is authorized to issue three billion of full
and fractional shares of beneficial interest, $.001 par value per share, of
which one billion shares are classified as Series 2 Shares (the Advisor Shares).
The Emerging Growth Fund, the International Equity Fund, the Japan OTC Fund, the
Emerging Markets Fund, the Post-Venture Capital Fund, the Japan Growth Fund, the
Small Company Value Fund and the Global Post-Venture Capital Fund are each
authorized to issue three billion full and fractional shares of capital stock,
$.001 par value per share, of which one billion shares of each Fund are
designated as Series 2 Shares (the Advisor Shares).
Transactions in shares of each Fund were as follows:
<TABLE>
<CAPTION>
CAPITAL APPRECIATION FUND EMERGING GROWTH FUND
COMMON SHARES ADVISOR SHARES COMMON SHARES
---------------------------- ---------------------------- -------------------------------
FOR THE YEAR ENDED OCTOBER 31, FOR THE YEAR ENDED OCTOBER 31,
------------------------------------------------------------- -------------------------------
1996 1995 1996 1995 1996 1995
------------ ----------- ------------ ----------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Shares sold 10,910,433 6,020,619 1,088,505 201,782 25,903,237 9,808,362
Shares issued to
shareholders on
reinvestment of
dividends 1,964,279 850,478 140,666 46,554 976,986 0
Shares redeemed (4,541,337) (3,638,974) (619,616) (110,027) (9,467,243) (4,294,179)
------------ ----------- ------------ ----------- ------------- -------------
Net increase
(decrease) in
shares
outstanding 8,333,375 3,232,123 609,555 138,309 17,412,980 5,514,183
------------ ----------- ------------ ----------- ------------- -------------
------------ ----------- ------------ ----------- ------------- -------------
Proceeds from
sale of shares $182,785,188 $85,992,655 $ 18,066,949 $ 2,970,800 $ 823,521,694 $ 256,886,928
Reinvested dividends 29,110,611 10,670,876 2,066,378 575,876 27,951,581 0
Net asset value of
shares redeemed (75,988,938) (51,907,650) (10,179,680) (1,551,821) (301,193,801) (106,777,032)
------------ ----------- ------------ ----------- ------------- -------------
Net increase
(decrease) from
capital share
transactions $135,906,861 $44,755,881 $ 9,953,647 $ 1,994,855 $ 550,279,474 $ 150,109,896
------------ ----------- ------------ ----------- ------------- -------------
------------ ----------- ------------ ----------- ------------- -------------
<CAPTION>
ADVISOR SHARES
----------------------------
1996 1995
------------ -----------
<S> <C> <C> <C>
Shares sold 5,757,390 3,172,686
Shares issued to
shareholders on
reinvestment of
dividends 392,736 0
Shares redeemed (503,703) (383,922)
------------ ----------- -
Net increase
(decrease) in
shares
outstanding 5,646,423 2,788,764
------------ ----------- -
------------ ----------- -
Proceeds from
sale of shares $179,122,460 $78,682,150
Reinvested dividends 10,992,670 0
Net asset value of
shares redeemed (15,189,970) (9,503,812)
------------ ----------- -
Net increase
(decrease) from
capital share
transactions $174,925,160 $69,178,338
------------ ----------- -
------------ ----------- -
</TABLE>
92
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY FUND JAPAN OTC FUND
COMMON SHARES ADVISOR SHARES COMMON SHARES ADVISOR SHARES
--------------------------------- ----------------------------- ------------------------------ -------------------
FOR THE YEAR ENDED OCTOBER 31, FOR THE YEAR ENDED OCTOBER 31,
------------------------------------------------------------------- ------------------------------------------------------
1996 1995 1996 1995 1996 1995 1996 1995
-------------- -------------- ------------ ------------ ------------- ------------ ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
62,925,567 68,096,606 8,409,095 7,225,150 27,475,535 22,809,795 5 0
2,770,933 2,623,005 462,235 346,377 862,068 0 5 0
(33,441,506) (38,317,625) (1,042,298) (770,753) (29,739,842) (5,180,432) (1) 0
-------------- -------------- ------------ ------------ ------------- ------------ -- -
32,254,994 32,401,986 7,829,032 6,800,774 (1,402,239) 17,629,363 9 0
-------------- -------------- ------------ ------------ ------------- ------------ -- -
-------------- -------------- ------------ ------------ ------------- ------------ -- -
$1,293,010,856 $1,251,776,887 $172,408,895 $131,585,072 $ 252,768,775 $200,565,875 $50 $ 0
53,202,204 48,487,109 8,824,068 6,385,868 7,560,332 0 41 0
(687,911,641) (701,310,424) (21,221,219) (14,287,779) (268,976,982) (44,871,674) (6) 0
-------------- -------------- ------------ ------------ ------------- ------------ -- -
$ 658,301,419 $ 598,953,572 $160,011,744 $123,683,161 $ (8,647,875) $155,694,201 $85 $ 0
-------------- -------------- ------------ ------------ ------------- ------------ -- -
-------------- -------------- ------------ ------------ ------------- ------------ -- -
</TABLE>
93
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
5. CAPITAL SHARE TRANSACTIONS (CONT'D)
<TABLE>
<CAPTION>
EMERGING MARKETS FUND
COMMON SHARES ADVISOR SHARES
------------------------------ ------------------------------
FOR THE FOR THE
PERIOD PERIOD
DECEMBER 30, DECEMBER 30,
1994 1994
(COMMENCEMENT (COMMENCEMENT
OF OF
FOR THE OPERATIONS) FOR THE OPERATIONS)
YEAR ENDED THROUGH YEAR ENDED THROUGH
OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31,
1996 1995 1996 1995
------------ ------------- ------------ -------------
<S> <C> <C> <C> <C>
Shares sold 24,216,832 694,008 12,119 22
Shares issued to
shareholders on
reinvestment of
dividends 17,172 1,267 1 0
Shares redeemed (6,918,123) (104,480) (1) 0
------------ ------------- ------ --
Net increase
(decrease) in
shares
outstanding 17,315,881 590,795 12,119 22
------------ ------------- ------ --
------------ ------------- ------ --
Proceeds from sale
of shares $309,055,609 $ 7,753,651 $151,302 $ 257
Reinvested dividends 191,472 13,802 14 0
Net asset value of
shares redeemed (87,855,453) (1,191,160) (6) 0
------------ ------------- ------ --
Net increase
(decrease) from
capital share
transactions $221,391,628 $ 6,576,293 $151,310 $ 257
------------ ------------- ------ --
------------ ------------- ------ --
<CAPTION>
POST-VENTURE CAPITAL FUND
COMMON SHARES ADVISOR SHARES
----------------------------- -----------------------------
FOR THE FOR THE
PERIOD PERIOD
SEPTEMBER 29, SEPTEMBER 29,
1995 1995
(COMMENCEMENT (COMMENCEMENT
OF OF
FOR THE OPERATIONS) FOR THE OPERATIONS)
YEAR ENDED THROUGH YEAR ENDED THROUGH
OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31,
1996 1995 1996 1995
------------ ------------- ----------- -------------
<S> <C> <C> <C> <C>
Shares sold 15,683,612 273,510 13,545 19
Shares issued to
shareholders on
reinvestment of
dividends 0 0 0 0
Shares redeemed (5,665,702) (473) (846) 0
------------ ------------- ----------- --
Net increase
(decrease) in
shares
outstanding 10,017,910 273,037 12,699 19
------------ ------------- ----------- --
------------ ------------- ----------- --
Proceeds from sale
of shares $249,017,481 $ 2,792,203 $ 227,722 $ 200
Reinvested dividends 0 0 0 0
Net asset value of
shares redeemed (90,369,709) (4,887) (14,986) 0
------------ ------------- ----------- --
Net increase
(decrease) from
capital share
transactions $158,647,772 $ 2,787,316 $ 212,736 $ 200
------------ ------------- ----------- --
------------ ------------- ----------- --
</TABLE>
6. NET ASSETS
Net Assets at October 31, 1996, consisted of the following:
<TABLE>
<CAPTION>
CAPITAL EMERGING INTERNATIONAL
APPRECIATION GROWTH EQUITY JAPAN OTC
FUND FUND FUND FUND
------------ -------------- -------------- ------------
<S> <C> <C> <C> <C>
Capital contributed, net $319,188,335 $1,204,074,928 $3,089,320,596 $166,971,738
Accumulated net
investment income 1,645,742 0 67,301,533 0
Accumulated net realized
gain (loss) from
security transactions 45,742,900 (835,533) 60,978,507 1,011,429
Net unrealized
appreciation
(depreciation) from
investments and foreign
currency related items 64,570,042 264,140,717 168,317,557 (13,521,913)
------------ -------------- -------------- ------------
Net assets $431,147,019 $1,467,380,112 $3,385,918,193 $154,461,254
------------ -------------- -------------- ------------
------------ -------------- -------------- ------------
<CAPTION>
EMERGING
MARKETS
FUND
------------
<S> <C>
Capital contributed, net $228,220,488
Accumulated net
investment income 183,857
Accumulated net realized
gain (loss) from
security transactions 797,347
Net unrealized
appreciation
(depreciation) from
investments and foreign
currency related items (10,631,345)
------------
Net assets $218,570,347
------------
------------
</TABLE>
94
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GLOBAL POST-VENTURE CAPITAL FUND
JAPAN GROWTH FUND SMALL COMPANY VALUE FUND
COMMON SHARES ADVISOR SHARES COMMON SHARES ADVISOR SHARES COMMON SHARES ADVISOR SHARES
------------- -------------- ------------- -------------- ------------- --------------
FOR THE PERIOD SEPTEMBER 30,
FOR THE PERIOD DECEMBER 29, 1995 FOR THE PERIOD DECEMBER 29, 1995 1996
(COMMENCEMENT OF OPERATIONS) (COMMENCEMENT OF OPERATIONS) (COMMENCEMENT OF OPERATIONS)
THROUGH OCTOBER 31, 1996 THROUGH OCTOBER 31, 1996 THROUGH OCTOBER 31, 1996
-------------------------------- -------------------------------- --------------------------------
<S> <C> <C> <C> <C> <C> <C>
3,251,155 20 6,643,221 228 295,856 557
0 0 0 0 0 0
(1,215,308) (1) (808,794) (1) (698) 0
------------- ---- ------------- --- ------------- ---
2,035,847 19 5,834,427 227 295,158 557
------------- ---- ------------- --- ------------- ---
------------- ---- ------------- --- ------------- ---
$ 33,728,191 $200 $ 85,546,767 $3,200 $ 2,966,681 $5,607
0 0 0 0 0 0
(12,660,992) (5) (10,985,928) (5) (6,824) 0
------------- ---- ------------- --- ------------- ---
$ 21,067,199 $195 $ 74,560,839 $3,195 $ 2,959,857 $5,607
------------- ---- ------------- --- ------------- ---
------------- ---- ------------- --- ------------- ---
</TABLE>
<TABLE>
<CAPTION>
GLOBAL
POST-VENTURE SMALL COMPANY POST-VENTURE
CAPITAL JAPAN GROWTH VALUE CAPITAL
FUND FUND FUND FUND
------------ ------------ ------------- ------------
<S> <C> <C> <C> <C>
$160,603,404 $21,167,395 $74,664,034 $3,064,642
0 258,949 0 0
(9,994,031) (105,168) 1,229,542 (15,394)
14,675,945 (1,162,727) 8,156,391 (35,333)
------------ ------------ ------------- ------------
$165,285,318 $20,158,449 $84,049,967 $3,013,915
------------ ------------ ------------- ------------
------------ ------------ ------------- ------------
</TABLE>
95
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
7. CAPITAL LOSS CARRYOVER
At October 31, 1996, capital loss carryovers available to offset possible
future capital gains of each Fund were as follows:
<TABLE>
<CAPTION>
CAPITAL LOSS CARRYOVER
EXPIRING IN
----------------------- TOTAL CAPITAL
FUND 2003 2004 LOSS CARRYOVER
- -------------------------------------------------------- ------- ---------- --------------
<S> <C> <C> <C>
Post-Venture Capital $26,884 $9,159,962 $9,186,846
Japan Growth 0 86,053 86,053
Global Post-Venture Capital 0 15,394 15,394
</TABLE>
96
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
8. OTHER FINANCIAL HIGHLIGHTS
Each Fund currently offers one other class of shares, Common Shares,
representing equal prorata interests in each of the respective Warburg Pincus
Equity Funds. The financial highlights for a Common Share of each Fund are as
follows:
<TABLE>
<CAPTION>
CAPITAL APPRECIATION FUND
--------------------------------------------------
COMMON SHARES
--------------------------------------------------
FOR THE YEAR ENDED OCTOBER 31,
--------------------------------------------------
1996 1995 1994 1993 1992
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF YEAR $16.39 $14.29 $15.32 $13.30 $12.16
------ ------ ------ ------ ------
Income from Investment Operations:
Net Investment Income .08 .04 .04 .05 .04
Net Gain on Securities (both realized and
unrealized) 3.53 3.08 .17 2.78 1.21
------ ------ ------ ------ ------
Total from Investment Operations 3.61 3.12 .21 2.83 1.25
------ ------ ------ ------ ------
Less Distributions:
Dividends from Net Investment Income (.01) (.04) (.05) (.05) (.06)
Distributions from Capital Gains (2.04) (.98) (1.19) (.76) (.05)
------ ------ ------ ------ ------
Total Distributions (2.05) (1.02) (1.24) (.81) (.11)
------ ------ ------ ------ ------
NET ASSET VALUE, END OF YEAR $17.95 $16.39 $14.29 $15.32 $13.30
------ ------ ------ ------ ------
------ ------ ------ ------ ------
Total Return 24.67% 24.05% 1.65% 22.19% 10.40%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Year (000s) $407,707 $235,712 $159,346 $159,251 $117,900
Ratios to average daily net assets:
Operating expenses 1.03% 1.12% 1.05% 1.01% 1.06%
Net investment income .59% .31% .26% .30% .41%
Decrease reflected in above operating expense
ratios due to waivers/reimbursements .01% .00% .01% .00% .01%
Portfolio Turnover Rate 170.69% 146.09% 51.87% 48.26% 55.83%
Average Commission Rate # $.0595 -- -- -- --
</TABLE>
- --------------------------------------------------------------------------------
# Computed by dividing the total amount of commissions paid by the total number
of shares purchased and sold during the period for which there was a
commission charged.
TAX STATUS OF 1996 DIVIDENDS (Unaudited)
Taxable dividends paid by the Fund on a per share basis were as follows:
Ordinary income $ .88
Long-term capital gain 1.17
Ordinary income dividends qualifying for the dividends received deduction
available to corporate shareholders was 29.58%.
Because the Fund's fiscal year is not the calendar year, amounts to be used by
calendar year taxpayers on their Federal return will be reflected on Form
1099-DIV and will be mailed in January 1997.
97
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
8. OTHER FINANCIAL HIGHLIGHTS (CONT'D)
<TABLE>
<CAPTION>
EMERGING GROWTH FUND
---------------------------------------------------
COMMON SHARES
---------------------------------------------------
FOR THE YEAR ENDED OCTOBER 31,
---------------------------------------------------
1996 1995 1994 1993 1992
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF YEAR $29.97 $22.38 $23.74 $18.28 $16.97
------ ------ ------ ------ ------
Income from Investment Operations:
Net Investment Loss (.02) (.05) (.06) (.10) (.03)
Net Gain on Securities (both realized and
unrealized) 4.60 7.64 .06 5.93 1.71
------ ------ ------ ------ ------
Total from Investment
Operations 4.58 7.59 .00 5.83 1.68
------ ------ ------ ------ ------
Less Distributions:
Dividends from Net Investment Income .00 .00 .00 .00 (.01)
Distributions from Capital Gains (1.75) .00 (1.36) (.37) (.36)
------ ------ ------ ------ ------
Total Distributions (1.75) .00 (1.36) (.37) (.37)
------ ------ ------ ------ ------
NET ASSET VALUE, END OF YEAR $32.80 $29.97 $22.38 $23.74 $18.28
------ ------ ------ ------ ------
------ ------ ------ ------ ------
Total Return 16.14% 33.91% .16% 32.28% 9.87%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Year (000s) $1,104,684 $487,537 $240,664 $165,525 $99,562
Ratios to average daily net assets:
Operating expenses 1.27% 1.26% 1.22% 1.23% 1.24%
Net investment loss (.63%) (.58%) (.58%) (.60%) (.25%)
Decrease reflected in above operating expense
ratios due to waivers/reimbursements .01% .00% .04% .00% .08%
Portfolio Turnover Rate 65.77% 84.82% 60.38% 68.35% 63.35%
Average Commission Rate # $.0567 -- -- -- --
</TABLE>
- --------------------------------------------------------------------------------
# Computed by dividing the total amount of commissions paid by the total number
of shares purchased and sold during the period for which there was a
commission charged.
TAX STATUS OF 1996 DIVIDENDS (Unaudited)
Taxable dividends paid by the Fund on a per share basis were as follows:
Ordinary income $ .38
Long-term capital gain 1.37
Ordinary income dividends qualifying for the dividends received deduction
available to corporate shareholders was 25.21%.
Because the Fund's fiscal year is not the calendar year, amounts to be used by
calendar year taxpayers on their Federal return will be reflected on Form
1099-DIV and will be mailed in January 1997.
98
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
8. OTHER FINANCIAL HIGHLIGHTS (CONT'D)
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY FUND
------------------------------------------------------
COMMON SHARES
------------------------------------------------------
FOR THE YEAR ENDED OCTOBER 31,
------------------------------------------------------
1996 1995 1994 1993 1992
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF YEAR $19.30 $20.51 $17.00 $12.22 $13.66
------ ------ ------ ------ ------
Income from Investment Operations:
Net Investment Income .22 .12 .09 .09 .15
Net Gain (Loss) on Securities and
Foreign Currency Related Items (both
realized and unrealized) 1.73 (.67) 3.51 4.84 (1.28)
------ ------ ------ ------ ------
Total from Investment
Operations 1.95 (.55) 3.60 4.93 (1.13)
------ ------ ------ ------ ------
Less Distributions:
Dividends from Net Investment Income (.56) (.13) (.04) (.02) (.16)
Distributions in Excess of Net
Investment Income .00 .00 (.01) .00 .00
Distributions from Capital Gains .00 (.53) (.04) (.13) (.15)
------ ------ ------ ------ ------
Total Distributions (.56) (.66) (.09) (.15) (.31)
------ ------ ------ ------ ------
NET ASSET VALUE, END OF YEAR $20.69 $19.30 $20.51 $17.00 $12.22
------ ------ ------ ------ ------
------ ------ ------ ------ ------
Total Return 10.35% (2.55%) 21.22% 40.68% (8.44%)
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Year (000s) $2,885,453 $2,068,207 $1,533,872 $378,661 $101,763
Ratios to average daily net assets:
Operating expenses 1.37% 1.39% 1.44% 1.48% 1.49%
Net investment income .62% .69% .19% .38% .88%
Decrease reflected in above operating
expense ratios due to
waivers/reimbursements .01% .00% .00% .00% .07%
Portfolio Turnover Rate 32.49% 39.24% 17.02% 22.60% 53.29%
Average Commission Rate # $.0170 -- -- -- --
</TABLE>
- --------------------------------------------------------------------------------
# Computed by dividing the total amount of commissions paid by the total number
of shares purchased and sold during the period for which there was a
commission charged.
TAX STATUS OF 1996 DIVIDENDS (Unaudited)
Taxable dividends paid by the Fund on a per share basis were as follows:
Ordinary income $ .56
Because the Fund's fiscal year is not the calendar year, amounts to be used by
calendar year taxpayers on their Federal return will be reflected on Form
1099-DIV and will be mailed in January 1997.
99
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
8. OTHER FINANCIAL HIGHLIGHTS (CONT'D)
<TABLE>
<CAPTION>
JAPAN OTC FUND
----------------------------------------------
COMMON SHARES
----------------------------------------------
FOR THE PERIOD
SEPTEMBER 30, 1994
FOR THE YEAR ENDED (COMMENCEMENT OF
OCTOBER 31, OPERATIONS)
----------------------- THROUGH
1996 1995 OCTOBER 31, 1994
--------- --------- ------------------
<S> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $9.09 $9.85 $10.00
--- --- -----
Income from Investment Operations:
Net Investment Loss (.23) .00 .00
Net Gain (Loss) on Securities and Foreign Currency
Related
Items (both realized and unrealized) (.01) (.76) (.15)
--- --- -----
Total from Investment Operations (.24) (.76) (.15)
--- --- -----
Less Distributions:
Dividends from Net Investment Income (.38) .00 .00
Distributions from Capital Gains .00 .00 .00
--- --- -----
Total Distributions (.38) .00 .00
--- --- -----
NET ASSET VALUE, END OF PERIOD $8.47 $9.09 $ 9.85
--- --- -----
--- --- -----
Total Return (2.79%) (7.72%) (1.50%)`D'
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (000s) $154,460 $178,568 $19,878
Ratios to average daily net assets:
Operating expenses 1.75% 1.41% 1.00%*
Net investment income (loss) (1.22%) (.15%) .49%*
Decrease reflected in above operating expense
ratios due to waivers/reimbursements .30% 1.35% 4.96%*
Portfolio Turnover Rate 95.23% 82.98% .00%
Average Commission Rate # $.0968 -- --
</TABLE>
- --------------------------------------------------------------------------------
`D' Non-Annualized
* Annualized
# Computed by dividing the total amount of commissions paid by the total number
of shares purchased and sold during the period for which there was a
commission charged.
TAX STATUS OF 1996 DIVIDENDS (Unaudited)
Taxable dividends paid by the Fund on a per share basis were as follows:
Ordinary income $ .38
Because the Fund's fiscal year is not the calendar year, amounts to be used by
calendar year taxpayers on their Federal return will be reflected on Form
1099-DIV and will be mailed in January 1997.
100
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
8. OTHER FINANCIAL HIGHLIGHTS (CONT'D)
<TABLE>
<CAPTION>
EMERGING MARKETS FUND
----------------------------------------
COMMON SHARES
----------------------------------------
FOR THE PERIOD
DECEMBER 30, 1994
FOR THE (COMMENCEMENT OF
YEAR ENDED OPERATIONS) THROUGH
OCTOBER 31, 1996 OCTOBER 31, 1995
---------------- -------------------
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $11.28 $ 10.00
----- -----
Income from Investment Operations:
Net Investment Income .07 .08
Net Gain on Securities and Foreign Currency Related
Items (both realized and unrealized) .99 1.25
----- -----
Total from Investment Operations 1.06 1.33
----- -----
Less Distributions:
Dividends from Net Investment Income (.08) (.05)
Distributions from Capital Gains (.07) .00
----- -----
Total Distributions (.15) (.05)
----- -----
NET ASSET VALUE, END OF PERIOD $12.19 $ 11.28
----- -----
----- -----
Total Return 9.46% 13.33%`D'
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (000s) $218,421 $6,780
Ratios to average daily net assets:
Operating expenses 1.61% 1.00%*
Net investment income .31% 1.25%*
Decrease reflected in above operating expense ratios
due to waivers/reimbursements .78% 11.08%*
Portfolio Turnover Rate 61.84% 57.76%`D'
Average Commission Rate # $.0135 --
</TABLE>
- --------------------------------------------------------------------------------
`D' Non-Annualized
* Annualized
# Computed by dividing the total amount of commissions paid by the total number
of shares purchased and sold during the period for which there was a
commission charged.
TAX STATUS OF 1996 DIVIDENDS (Unaudited)
Taxable dividends paid by the Fund on a per share basis were as follows:
Ordinary income $ .15
Because the Fund's fiscal year is not the calendar year, amounts to be used by
calendar year taxpayers on their Federal return will be reflected on Form
1099-DIV and will be mailed in January 1997.
101
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
8. OTHER FINANCIAL HIGHLIGHTS (CONT'D)
<TABLE>
<CAPTION>
POST-VENTURE CAPITAL FUND
---------------------------------------
COMMON SHARES
---------------------------------------
FOR THE PERIOD
SEPTEMBER 29, 1995
(COMMENCEMENT OF
FOR THE OPERATIONS)
YEAR ENDED THROUGH
OCTOBER 31, 1996 OCTOBER 31, 1995
---------------- ------------------
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $10.69 $10.00
----- -----
Income from Investment Operations:
Net Investment Loss (.11) .00
Net Gain on Securities and Foreign Currency Related
Items (both realized and unrealized) 5.45 .69
----- -----
Total from Investment Operations 5.34 .69
----- -----
Less Distributions:
Dividends from Net Investment Income .00 .00
Distributions from Capital Gains .00 .00
----- -----
Total Distributions .00 .00
----- -----
NET ASSET VALUE, END OF PERIOD $16.03 $10.69
----- -----
----- -----
Total Return 49.95% 6.90%`D'
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (000s) $165,081 $3,024
Ratios to average daily net assets:
Operating expenses 1.65% 1.65%*
Net investment income (loss) (1.13%) .25%*
Decrease reflected in above operating expense ratios
due to waivers/reimbursements .67% 23.76%*
Portfolio Turnover Rate 168.46% 16.90%`D'
Average Commission Rate # $.0529 --
</TABLE>
- --------------------------------------------------------------------------------
`D' Non-Annualized
* Annualized
# Computed by dividing the total amount of commissions paid by the total number
of shares purchased and sold during the period for which there was a
commission charged.
102
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
8. OTHER FINANCIAL HIGHLIGHTS (CONT'D)
<TABLE>
<CAPTION>
JAPAN GROWTH FUND
-------------------
COMMON SHARES
-------------------
FOR THE PERIOD
DECEMBER 29, 1995
(COMMENCEMENT OF
OPERATIONS) THROUGH
OCTOBER 31, 1996
-------------------
<S> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.00
------
Income from Investment Operations:
Net Investment Loss (.06)
Net Loss on Securities and Foreign Currency Related Items (both
realized and unrealized) (.09)
------
Total from Investment Operations (.15)
------
Less Distributions:
Dividends from Net Investment Income .00
Distributions from Capital Gains .00
------
Total Distributions .00
------
NET ASSET VALUE, END OF PERIOD $ 9.85
------
------
Total Return (1.50%)`D'
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (000s) $20,157
Ratios to average daily net assets:
Operating expenses 1.75%*
Net investment loss (1.03%)*
Decrease reflected in above operating expense ratio due to
waivers/reimbursements 1.80%*
Portfolio Turnover Rate 51.72%`D'
Average Commission Rate # $.0717
</TABLE>
- --------------------------------------------------------------------------------
`D' Non-Annualized
* Annualized
# Computed by dividing the total amount of commissions paid by the total number
of shares purchased and sold during the period for which there was a
commission charged.
103
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
8. OTHER FINANCIAL HIGHLIGHTS (CONT'D)
<TABLE>
<CAPTION>
SMALL COMPANY VALUE
FUND
-------------------
COMMON SHARES
-------------------
FOR THE PERIOD
DECEMBER 29, 1995
(COMMENCEMENT OF
OPERATIONS) THROUGH
OCTOBER 31, 1996
-------------------
<S> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.00
------
Income from Investment Operations:
Net Investment Loss (.02)
Net Gain on Securities (both realized and unrealized) 4.40
------
Total from Investment Operations 4.38
------
Less Distributions:
Dividends from Net Investment Income .00
Distributions from Capital Gains .00
------
Total Distributions .00
------
NET ASSET VALUE, END OF PERIOD $ 14.38
------
------
Total Return 43.80%`D'
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (000s) $84,045
Ratios to average daily net assets:
Operating expenses 1.75%*
Net investment loss (43%)*
Decrease reflected in above operating expense ratio due to
waivers/reimbursements .44%*
Portfolio Turnover Rate 43.14%`D'
Average Commission Rate # $.0570
</TABLE>
- --------------------------------------------------------------------------------
`D' Non-Annualized
* Annualized
# Computed by dividing the total amount of commissions paid by the total number
of shares purchased and sold during the period for which there was a
commission charged.
104
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1996
- --------------------------------------------------------------------------------
8. OTHER FINANCIAL HIGHLIGHTS (CONT'D)
<TABLE>
<CAPTION>
GLOBAL
POST-VENTURE
CAPITAL FUND
------------------
FOR THE PERIOD
SEPTEMBER 30, 1996
(COMMENCEMENT OF
OPERATIONS)
THROUGH
OCTOBER 31, 1996
------------------
<S> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.00
------
Income from Investment Operations:
Net Investment Income .00
Net Loss on Securities and Foreign Currency Related Items (both
realized and unrealized) (.14)
------
Total from Investment Operations (.14)
------
Less Distributions:
Dividends from Net Investment Income .00
Distributions from Capital Gains .00
------
Total Distributions .00
------
NET ASSET VALUE, END OF PERIOD $ 9.86
------
------
Total Return (1.40%)`D'
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (000s) $3,007
Ratios to average daily net assets:
Operating expenses 1.65%*
Net investment loss (.20%)*
Decrease reflected in above operating expense ratio due to
waivers/reimbursements 21.71%*
Portfolio Turnover Rate 5.85%`D'
Average Commission Rate # $.0323
</TABLE>
- --------------------------------------------------------------------------------
`D' Non-Annualized
* Annualized
# Computed by dividing the total amount of commissions paid by the total number
of shares purchased and sold during the period for which there was a
commission charged.
105
<PAGE>
<PAGE>
WARBURG PINCUS EQUITY FUNDS
REPORT OF INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
To the Boards of Directors, Trustees and Shareholders of
WARBURG PINCUS EQUITY FUNDS
We have audited the accompanying statements of net assets of Warburg Pincus
Capital Appreciation Fund, Warburg Pincus Emerging Growth Fund, Warburg Pincus
International Equity Fund, Warburg Pincus Emerging Markets Fund, Warburg Pincus
Post-Venture Capital Fund, Warburg Pincus Japan Growth Fund, Warburg Pincus
Small Company Value Fund, Warburg Pincus Global Post-Venture Capital Fund and
the accompanying statement of assets and liabilities and the schedule of
investments of Warburg Pincus Japan OTC Fund (all Funds collectively referred to
as the 'Warburg Pincus Equity Funds') as of October 31, 1996, and the related
statements of operations for the year (or periods) then ended, the related
statements of changes in net assets for each of the two years (or periods) in
the period then ended and the financial highlights for each of the four years
(or periods) in the period then ended. These financial statements and financial
highlights are the responsibility of the Funds' management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits. The financial highlights of each of the Warburg Pincus
Equity Funds for the period ended October 31, 1992, were audited by other
auditors, whose report dated December 15, 1992, expressed an unqualified
opinion.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
October 31, 1996, by correspondence with the custodians and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of each
of the Warburg Pincus Equity Funds as of October 31, 1996, and the results of
their operations for the year (or periods) then ended, and the changes in their
net assets for each of the two years (or periods) in the period then ended and
the financial highlights for each of the four years (or periods) in the period
then ended, in conformity with generally accepted accounting principles.
COOPERS & LYBRAND L.L.P.
2400 Eleven Penn Center
Philadelphia, PA
December 18, 1996
106
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<PAGE>
<PAGE>
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<PAGE>
<PAGE>
WARBURG PINCUS
ADVISOR FUNDS
COUNSELLORS
SECURITIES INC.,
DISTRIBUTOR
800-369-2728
[WARBURG PINCUS LOGO]
INVESTMENTS ADEQF-2-1096
STATEMENT OF DIFFERENCES
------------------------
The dagger symbol shall be expressed as...... `D'
The division symbol shall be expressed as.... [div]
