<PAGE> 1
File No. 33-60269
As filed with the Securities and Exchange Commission on July 12, 1995.
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-14
_____
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 /_X__/
_____
Pre-Effective Amendment No. 1 /_X _/
____
Post-Effective Amendment No. ___ /____/
(Check appropriate box or boxes)
JOHN HANCOCK SERIES, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
101 Huntington Avenue, Boston, Massachusetts 02199-7603
- --------------------------------------------------------------------------------
(Address of principal executive office) Zip Code
(617) 375-1700
- --------------------------------------------------------------------------------
(Registrant's Telephone Number, including Area Code)
With a copy to:
---------------
Thomas H. Drohan Jeffrey N. Carp, Esq.
John Hancock Advisers, Inc. Hale and Dorr
101 Huntington Avenue 60 State Street
Boston, MA 02199 Boston, MA 02109
- --------------------------------------------------------------------------------
(Name and address of agent for service)
Approximate Date of Proposed Public Offering: As soon as practicable
after the effectiveness of the registration statement.
No filing fee is required because an indefinite number of shares have
previously been registered pursuant to Rule 24f-2 under the Investment Company
Act of 1940, as amended. This Registration Statement relates to shares
previously registered on Form N-1A (File No. 811-5254)
It is proposed that the effectiveness of this filing will be accelerated so
that this filing will become effective on July 15, 1995, pursuant to Rule
461 under the Securities Act of 1933.
<PAGE> 2
FINANCIAL STATEMENTS
John Hancock Funds - Government Income Fund
THESE UNAUDITED INTERIM FINANCIAL STATEMENTS REFLECT ALL ADJUSTMENTS WHICH ARE,
IN THE OPINION OF MANAGEMENT, NECESSARY FOR A FAIR STATEMENT OF THE RESULTS FOR
THE INTERIM PERIOD PRESENTED. ANY ADJUSTMENTS REFLECTED HEREIN ARE OF A NORMAL
RECURRING NATURE. THE STATEMENT OF ASSETS AND LIABILITIES IS THE FUND'S
BALANCE SHEET AND SHOWS THE VALUE OF WHAT THE FUND OWNS, IS DUE AND OWES ON
APRIL 30, 1995. YOU'LL ALSO FIND THE NET ASSET VALUE AND THE MAXIMUM OFFERING
PRICE PER SHARE AS OF THAT DATE.
<TABLE>
STATEMENT OF ASSETS AND LIABILITIES
April 30, 1995 (Unaudited)
- ------------------------------------------------------------------------
<S> <C>
ASSETS:
Investments at value - Note C:
U.S. government and agencies securities
(cost - $193,972,895)............................... $193,669,454
Foreign government bonds (cost - $28,574,874) 24,964,493
Multi-family mortgage backed bonds
(cost - $9,896,545)................................. 9,320,670
Joint repurchase agreement ($230,000)................. 230,000
Corporate savings account............................. 452
------------
228,185,069
Receivable for shares sold.............................. 248,044
Receivable for investments sold......................... 1,041
Interest receivable..................................... 5,684,300
Other assets............................................ 105,050
------------
Total Assets......................... 234,223,504
----------------------------------------------------
LIABILITIES:
Dividend payable........................................ 582,590
Payable for shares repurchased.......................... 410,172
Payable to John Hancock Advisers, Inc. and
affiliates - Note B................................... 118,032
Accounts payable and accrued expenses................... 119,217
------------
Total Liabilities.................... 1,230,011
----------------------------------------------------
NET ASSETS:
Capital paid-in......................................... 257,949,685
Accumulated net realized loss on investments and
financial futures contracts........................... (19,956,438)
Net unrealized depreciation of investments and
financial futures contracts........................... (4,429,384)
Distributions in excess of net investment income ....... (570,370)
------------
Net Assets........................... $232,993,493
====================================================
NET ASSET VALUE PER SHARE:
(Based on net assets and shares of beneficial
interest outstanding - 350,000,000 shares authorized
with $0.01 per share par value, respectively)
Class A - $528,362/59,048............................... $ 8.95
=======================================================================
Class B - $232,465,131/25,974,481....................... $ 8.95
=======================================================================
MAXIMUM OFFERING PRICE PER SHARE*
Class A - ($8.95 x 105.03%)............................. $ 9.40
=======================================================================
</TABLE>
* On single retail sales of less than $100,000. On sales of $100,000 or more and
on group sales the offering price is reduced.
THE STATEMENT OF OPERATIONS SUMMARIZES THE FUND'S INVESTMENT INCOME EARNED AND
EXPENSES INCURRED IN OPERATING THE FUND. IT ALSO SHOWS NET GAINS (LOSSES) FOR
THE PERIOD STATED.
<TABLE>
STATEMENT OF OPERATIONS
Six months ended April 30, 1995 (Unaudited)
- --------------------------------------------------------------------------
<S> <C>
INVESTMENT INCOME:
Interest.................................................. $11,109,546
-----------
Expenses:
Distribution/service fee - Note B
Class A................................................ 331
Class B................................................ 1,151,100
Investment management fee - Note B...................... 744,785
Transfer agent fee...................................... 178,409
Interest expense........................................ 54,175
Custodian fee........................................... 39,618
Auditing fee............................................ 36,974
Registration and filing fees............................ 30,188
Miscellaneous........................................... 13,687
Trustees' fees.......................................... 13,643
Printing................................................ 9,246
Advisory board fee...................................... 8,694
Legal fees.............................................. 8,265
-----------
Total Expenses......................... 2,289,115
------------------------------------------------------
Net Investment Income.................. 8,820,431
------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND
FINANCIAL FUTURES CONTRACTS:
Net realized loss on investments sold..................... (7,392,486)
Net realized loss on financial futures contracts (257,031)
Change in net unrealized appreciation/depreciation
of investments.......................................... 12,996,287
Change in net unrealized appreciation/depreciation
of financial futures contracts.......................... (352,813)
-----------
Net Realized and Unrealized
Gain on Investments and
Financial Futures Contracts............ 4,993,957
------------------------------------------------------
Net Increase in Net Assets
Resulting from Operations.............. $13,814,388
======================================================
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
7
<PAGE> 3
FINANCIAL STATEMENTS
John Hancock Funds - Government Income Fund
<TABLE>
STATEMENT OF CHANGES IN NET ASSETS
- ----------------------------------------------------------------------------------------------
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1995
(UNAUDITED)
----------------
<S> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income .................................................... $ 8,820,431
Net realized loss on investments sold and financial futures contracts .... (7,649,517)
Change in net unrealized appreciation/depreciation of investments ........ 12,643,474
------------
Net Increase (Decrease) in Net Assets Resulting from Operations ........ 13,814,388
------------
DISTRIBUTIONS TO SHAREHOLDERS:
Dividends from net investment income
Class A - ($0.3600 and $0.0600 per share, respectively) ................ (10,739)
Class B - ($0.3270 and $0.6500 per share, respectively) ................ (8,652,273)
Distributions from net realized gain on investments sold
and financial futures contracts
Class B - (none and $0.0200 per share, respectively) ................... --
------------
Total Distributions to Shareholders .................................... (8,663,012)
------------
FROM FUND SHARE TRANSACTIONS -- NET* ...................................... (13,442,313)
------------
NET ASSETS:
Beginning of period ...................................................... 241,284,430
------------
End of period (including distibutions in excess of net investment income
of $570,370 and $727,789, respectively) ................................ $232,993,493
============
</TABLE>
* ANALYSIS OF FUND SHARE TRANSACTIONS:
<TABLE>
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1995
(UNAUDITED)
-----------------------------
SHARES AMOUNT
CLASS A** --------- ------------
<S> <C> <C>
Shares sold ..................................... 43,782 $ 388,329
Shares issued to shareholders in reinvestment
of distributions ............................. 311 2,736
---------- ------------
44,093 391,065
Less shares repurchased ........................ (10,523) (91,772)
---------- ------------
Net increase ................................... 33,570 $ 299,293
========== ============
CLASS B
Shares sold .................................... 1,476,867 $ 12,978,783
Shares issued to shareholders in reinvestment
of distributions ............................. 514,520 4,527,495
---------- ------------
1,991,387 17,506,278
Less shares repurchased ........................ (3,564,583) (31,247,884)
---------- ------------
Net decrease ................................... (1,573,196) ($13,741,606)
========== ============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
8
<PAGE> 4
FINANCIAL STATEMENTS
John Hancock Funds - Government Income Fund
<TABLE>
FINANCIAL HIGHLIGHTS
Selected data for a share of beneficial interest outstanding throughout the
period indicated, investment returns, key ratios and supplemental data are as
follows:
- ------------------------------------------------------------------------------------
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1995
(UNAUDITED)(a)
----------------
<S> <C>
CLASS A
PER SHARE OPERATING PERFORMANCE
Net Asset Value, Beginning of Period ........................... $8.75
------
Net Investment Income .......................................... 0.33(b)
Net Realized and Unrealized Gain (Loss) on
Investments and Financial Futures Contracts .................. 0.23
------
Total from Investment Operations ............................. 0.56
Less Distributions:
Dividends from Net Investment Income ........................... (0.36)
------
Net Asset Value, End of Period ................................. $8.95
======
Total Investment Return at Net Asset Value ..................... 6.54%
Total Adjusted Investment Return at Net Asset Value ............ 6.52%
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Period (000's omitted) ...................... $528
Ratio of Adjusted Expenses to Average Net Assets (c) ........... 1.19%*
Ratio of Adjusted Net Investment Income to Average Net Assets... 8.45%*
Portfolio Turnover Rate ........................................ 49%
</TABLE>
THE FINANCIAL HIGHLIGHTS SUMMARIZE THE IMPACT OF THE FOLLOWING FACTORS ON A
SINGLE SHARE FOR THE PERIOD INDICATED: THE NET INVESTMENT INCOME, GAINS
(LOSSES), DISTRIBUTIONS, AND TOTAL INVESTMENT RETURN OF THE FUND. IT SHOWS HOW
THE FUND'S NET ASSET VALUE FOR A SHARE HAS CHANGED SINCE THE END OF THE PREVIOUS
PERIOD. ADDITIONALLY, IMPORTANT RELATIONSHIPS BETWEEN SOME ITEMS PRESENTED IN
THE FINANCIAL STATEMENTS ARE EXPRESSED IN RATIO FORM.
SEE NOTES TO FINANCIAL STATEMENTS.
9
<PAGE> 5
FINANCIAL STATEMENTS
John Hancock Funds - Government Income Fund
<TABLE>
FINANCIAL HIGHLIGHTS (continued)
- -----------------------------------------------------------------------
<CAPTION>
SIX MONTHS
ENDED
APRIL 30, 1995
(UNAUDITED)(a)
--------------
<S> <C>
CLASS B
PER SHARE OPERATING PERFORMANCE
Net Asset Value, Beginning of Period .................. $ 8.75
--------
Net Investment Income ................................. 0.33(b)
Net Realized and Unrealized Gain (Loss) on
Investments and Financial Futures Contracts ......... 0.20
--------
Total from Investment Operations .................... 0.53
--------
Less Distributions:
Dividends from Net Investment Income .................. (0.33)
Distributions from Net Realized Gains on Investments
Sold and Financial Futures Contracts ................ --
--------
Total Distributions ................................. (0.33)
--------
Net Asset Value, End of Period ........................ $ 8.95
========
Total Investment Return at Net Asset Value ............ 6.15%
Total Adjusted Investment Return at Net Asset Value ... 6.13%
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Period (000's omitted) ............. $232,465
Ratio of Expenses to Average Net Assets (c) ........... 1.94%*
Ratio of Net Investment Income to Average Net Assets .. 7.70%*
Portfolio Turnover Rate ............................... 49%
</TABLE>
* On an annualized basis.
(a) On December 22, 1994, John Hancock Advisers, Inc. became the investment
adviser of the Fund.
(b) On average month end shares outstanding.
(c) Excluding interest expense, which equalled 0.02% for the six months ended
April 30, 1995, and 0.01%, 0.01% and 0.15% for the years ended October 31,
1994, 1993 and 1992, respectively.
SEE NOTES TO FINANCIAL STATEMENTS.
10
<PAGE> 6
FINANCIAL STATEMENTS
John Hancock Funds - Government Income Fund
<TABLE>
SCHEDULE OF INVESTMENTS
April 30, 1995 (Unaudited)
- -----------------------------------------------------------------------------------------------------------------------------
THE SCHEDULE OF INVESTMENTS IS A COMPLETE LIST OF ALL SECURITIES OWNED BY
GOVERNMENT INCOME FUND ON APRIL 30, 1995. IT'S DIVIDED INTO FOUR MAIN
CATEGORIES:U.S. GOVERNMENT AND AGENCIES SECURITIES, FOREIGN GOVERNMENT BONDS,
MULTI-FAMILY MORTGAGE BACKED BONDS AND SHORT-TERM INVESTMENTS. SHORT-TERM
INVESTMENTS, WHICH REPRESENT THE FUND'S "CASH" POSITION, ARE LISTED LAST.
<CAPTION>
PAR VALUE
INTEREST MATURITY (000'S MARKET
ISSUER, DESCRIPTION RATE DATE OMITTED) VALUE
- ------------------- -------- -------- --------- ------
<S> <C> <C> <C> <C>
U.S. GOVERNMENT AND AGENCIES SECURITIES
GOVERNMENTAL - U.S. (42.21%)
Financing Corp.,
Bond................................................................ 9.400% 02-08-18 $ 4,000 $ 4,671,880
Bond................................................................ 9.650 11-02-18 1,600 1,920,000
Tennessee Valley Authority,
Pwr Bond 1993 Ser D................................................. 7.250 07-15-43 8,000 7,170,080
Pwr Bond 1994 Ser A................................................. 7.850 06-15-44 5,000 4,785,200
United States Treasury,
Bond................................................................ 12.625 05-15-95 8,150 8,167,849
Bond................................................................ 11.500 11-15-95* 17,770 18,236,487
Bond................................................................ 15.750 11-15-01 16,865 24,601,819
Bond **............................................................. 11.625 11-15-04* 22,000 28,792,500
-----------
98,345,815
-----------
GOVERNMENTAL - U.S. AGENCIES (40.91%)
Federal Home Loan Mortgage Corp.,
30 Yr SF Pass Thru Ctf.............................................. 7.750 11-01-08 33 33,021
30 Yr SF Pass Thru Ctf.............................................. 8.000 04-01-07 67 67,097
CMO REMIC 1094-K.................................................... 7.000 06-15-21 2,300 2,149,051
CMO REMIC 1218-G.................................................... 4.500 05-15-14 2,000 1,732,500
CMO REMIC 1408-H.................................................... 6.500 10-15-19 4,754 4,382,939
CMO REMIC 1611-F.................................................... 5.750 05-15-21 17,006 15,342,424
Federal Judiciary Office Building,
Zero Coupon Bond.................................................... 0.000 02-15-01 250 164,500
Federal National Mortgage Association,
30 Yr SF Pass Thru Ctf.............................................. 8.500 08-01-24 to 22,642 23,005,387
10-01-24
GTD REMIC Pass Thru Ctf 1990-51- H.................................. 7.500 05-25-20 200 193,312
GTD REMIC Pass Thru Ctf 1990-58- J.................................. 7.000 05-25-20 3,700 3,435,191
GTD REMIC Pass Thru Ctf 1990-94- D.................................. 6.500 08-25-20 1,660 1,514,750
GTD REMIC Pass Thru Ctf 1991-56- M.................................. 6.750 06-25-21 4,000 3,645,000
GTD REMIC Pass Thru Ctf 1992-210-H.................................. 6.500 03-25-19* 10,000 9,196,800
GTD REMIC Pass Thru Ctf 1994-72-K................................... 6.000 04-25-24 6,389 5,082,928
STRIP MBS Ser 249 Class 2........................................... 6.500 10-25-23 1,892 672,907
Indexed Sinking Fund................................................ 9.950 05-10-99* 131 131,363
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
11
<PAGE> 7
FINANCIAL STATEMENTS
John Hancock Funds - Government Income Fund
<TABLE>
<CAPTION>
PAR VALUE
INTEREST MATURITY (000'S MARKET
ISSUER, DESCRIPTION RATE DATE OMITTED) VALUE
- ------------------- -------- -------- --------- ------
<S> <C> <C> <C> <C>
GOVERNMENTAL - U.S. AGENCIES (CONTINUED)
Government National Mortgage Association,
30 Yr SF Pass Thru Ctf.............................................. 8.000% 05-15-24 to *$24,570 $ 24,574,469
08-15-24 ------------
95,323,639
------------
TOTAL U.S. GOVERNMENT AND AGENCIES SECURITIES
(Cost $193,972,895) (83.12%) 193,669,454
------- ------------
FOREIGN GOVERNMENT BONDS
U.S. DOLLAR DENOMINATED FOREIGN GOVERNMENT BONDS (10.71%)
Brazil, Republic of,
Notes IDU Ser A-L................................................... 7.813# 01-01-01 2,940 2,227,050
British Columbia Hydro and Power Auth.
Bond Ser FG......................................................... 15.000 04-15-11 3,900 4,382,040
Bond Ser FJ......................................................... 15.500 11-15-11 1,700 2,005,014
Hydro-Quebec Corp.,
Deb Ser GH.......................................................... 8.250 04-15-26 1,000 975,210
Deb Ser GQ.......................................................... 8.250 01-15-27 1,000 977,040
Deb Ser GF.......................................................... 8.875 03-01-26 2,000 2,090,620
Deb Ser HK.......................................................... 9.375 04-15-30 2,000 2,197,480
Deb Ser FU.......................................................... 11.750 02-01-12 270 355,355
International Bank for Reconstruction and Development,
Forty Year Bond Ser 1986............................................ 8.875 03-01-26* 2,000 2,231,980
Ontario, Province of,
30 Year Deb......................................................... 15.125 05-01-11 1,345 1,521,854
30 Year Deb......................................................... 17.000 11-05-11 5,000 6,000,850
------------
TOTAL FOREIGN GOVERNMENT BONDS
(Cost $28,574,874 ) (10.71%) 24,964,493
------- ------------
MULTI-FAMILY MORTGAGE BACKED BONDS (4.00%)
DLJ Mortgage Acceptance Corp.,
CMO REMIC 1993-M10-A2............................................... 7.200 07-15-03 4,795 4,609,654
CMO REMIC 1993-MF7-A1............................................... 7.400 06-18-03 4,872 4,711,016
------------
TOTAL MULTI-FAMILY MORTGAGE BACKED BONDS
(Cost $9,896,545) (4.00%) 9,320,670
------- ------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
12
<PAGE> 8
FINANCIAL STATEMENTS
John Hancock Funds - Government Income Fund
<TABLE>
<CAPTION>
PAR VALUE
INTEREST MATURITY (000'S MARKET
ISSUER, DESCRIPTION RATE DATE OMITTED) VALUE
- ------------------- -------- -------- --------- ------
<S> <C> <C> <C> <C>
SHORT-TERM INVESTMENTS
JOINT REPURCHASE AGREEMENT (0.10%)
Investment in a joint repurchase agreement transaction
with BT Securities Corp., Dated 04-28-95, Due 05-01-95
(secured by U. S. Treasury Bond 10.75% Due 08-15-05 and
by U.S. Treasury Note 6.875% Due 10-31-96) Note A................... 5.93% 05-01-95 $ 230 $ 230,000
------------
CORPORATE SAVINGS ACCOUNT (0.00%)
Investors Bank & Trust Company
Daily Interest Savings
Account Current Rate 3.00%.......................................... 452
------------
TOTAL SHORT-TERM INVESTMENTS (0.10%) 230,452
------ ------------
TOTAL INVESTMENTS (97.93%) $228,185,069
====== ============
</TABLE>
* Securities, other than short-term investments, newly added to the portfolio
during the period ended April 30, 1995.
** U.S. Treasury Bonds with a value of $11,947,579 owned by the Fund were
designated as margin deposits for futures contracts at April 30, 1995.
# Represents rate in effect on April 30, 1995.
The percentage shown for each investment category is the total value of that
catgegory as a percentage of the net assets of the Fund.
SEE NOTES TO FINANCIAL STATEMENTS.
13
<PAGE> 9
NOTES TO FINANCIAL STATEMENTS
John Hancock Funds - Government Income Fund
(UNAUDITED)
NOTE A --
ACCOUNTING POLICIES
John Hancock Series, Inc. (the "Trust") is a diversified, open-end management
investment company, registered under the Investment Company Act of 1940, as
amended. The Trust consists of six series portfolios: John Hancock Government
Income Fund (the "Fund"), John Hancock Emerging Growth Fund, John Hancock High
Yield Tax Free Fund, John Hancock High Yield Bond Fund, John Hancock Money
Market Fund B and John Hancock Global Resources Fund. The Trustees may authorize
the creation of additional Funds from time to time to satisfy various investment
objectives. Effective December 22, 1994 (see Note B), the Trust and Funds
changed names by replacing the word Transamerica with John Hancock.
The Trustees have authorized the issuance of two classes of shares of
the Fund, designated as Class A and Class B. The shares of each class represent
an interest in the same portfolio of investments of the Fund and have equal
rights to voting, redemption, dividends, and liquidation, except that certain
expenses, subject to the approval of the Trustees, may be applied differently
to each class of shares in accordance with current regulations of the
Securities and Exchange Commission and the Internal Revenue Service.
Shareholders of a class which bears distribution/service expenses under the
terms of a distribution plan have exclusive voting rights regarding such
distribution plan. Class A Shares are subject to an initial sales charge of up
to 4.50% and a 12b-1 distribution plan. Prior to May 15, 1995, the maximum
sales charge was 4.75%. Class B Shares are subject to a contingent deferred
sales charge and a separate 12b-1 distribution plan. On September 30, 1994,
Class A shares were sold to commence class activity. Significant accounting
policies of the Fund are as follows:
VALUATION OF INVESTMENTS Securities in the Fund's portfolio are valued on the
basis of market quotations, valuations provided by independent pricing services
or, at fair value as determined in good faith in accordance with procedures
approved by the Trustees. Short-term debt investments maturing within 60 days
are valued at amortized cost which approximates market value.
JOINT REPURCHASE AGREEMENT Pursuant to an exemptive order issued by the
Securities and Exchange Commission, the Fund, along with other registered
investment companies having a management contract with John Hancock Advisers,
Inc. (the "Adviser"), a wholly-owned subsidiary of The Berkeley Financial Group,
may participate in a joint repurchase agreement transaction. Aggregate cash
balances are invested in one or more repurchase agreements, whose underlying
securities are obligations of the U.S. government and/or its agencies. The
Fund's custodian bank receives delivery of the underlying securities for the
joint account on the Fund's behalf. The Adviser is responsible for ensuring that
the agreement is fully collateralized at all times.
REVERSE REPURCHASE AGREEMENT Prior to December 22, 1994, the Fund entered into
reverse repurchase agreements which involve the sale of securities held by the
Fund to a bank or securities firm with an agreement that the Fund will buy back
the securities at a fixed future date at a fixed price plus an agreed amount of
"interest" which may be reflected in the repurchase price. Reverse repurchase
agreements are considered to be borrowings by the Fund and the Fund used the
proceeds obtained from the sale of securities to purchase other investments. On
December 22, 1994, the Fund discontinued investing in reverse repurchase
agreements.
OPTIONS Listed options will be valued at the last quoted sales price on the
exchange on which they are primarily traded. Purchased put or call
over-the-counter options will be valued at the average of the "bid" prices
obtained from two independent brokers. Written put or call over-the-counter
options will be valued at the average of the "asked" prices obtained from two
independent brokers. Upon the writing of a call or put option, an amount equal
to the premium received by the Fund will be included in the Statement of Assets
and Liabilities as an asset and corresponding liability. The amount of the
liability will be subsequently marked-to-market to reflect the current market
value of the written option.
The Fund may use option contracts to manage its exposure to the
financial markets. Writing puts and buying calls will tend to increase the
Fund's exposure to the underlying instrument and buying puts
14
<PAGE> 10
NOTES TO FINANCIAL STATEMENTS
John Hancock Funds - Government Income Fund
and writing calls will tend to decrease the Fund's exposure to the underlying
instrument, or hedge other Fund investments.
The maximum exposure to loss for any purchased options will be limited
to the premium initially paid for the option. In all other cases, the face (or
"notional") amount of each contract at value will reflect the maximum exposure
of the Fund in these contracts, but the actual exposure will be limited to the
change in value of the contract over the period the contract remains open.
Risks may also arise if counterparties do not perform under the
contracts' terms, or if the Fund is unable to offset a contract with a
counterparty on a timely basis ("liquidity risk"). Exchange-traded options have
minimal credit risk as the exchanges act as counterparties to each transaction,
and only present liquidity risk in highly unusual market conditions. To
minimize credit and liquidity risks in over-the-counter option contracts, the
Fund will continuously monitor the creditworthiness of all its counterparties.
At any particular time, except for purchased options, market or
credit risk may involve amounts in excess of those reflected in the Fund's
period-end Statement of Assets and Liabilities.
There were no written option transactions for the period ended April
30, 1995.
FINANCIAL FUTURES CONTRACTS The Fund may buy and sell financial futures
contracts for speculative purposes and/or to hedge against the effects of
fluctuations in interest rates, currency exchange rates and other market
conditions. At the time the Fund enters into a financial futures contract, it
will be required to deposit with its custodian a specified amount of cash or
U.S. government securities, known as "initial margin", equal to a certain
percentage of the value of the financial futures contract being traded. Each
day, the futures contract will be valued at the official settlement price of the
board of trade or U.S. commodities exchange. Subsequent payments, known as
"variation margin", to and from the broker will be made on a daily basis as the
market price of the financial futures contract fluctuates. Daily variation
margin adjustments, arising from this "mark to market", will be recorded by the
Fund as unrealized gains or losses.
When the contracts are closed, the Fund will recognize a gain or loss.
Risks of entering into futures contracts include the possibility that there may
be an illiquid market and/or that a change in the value of the contracts may not
correlate with changes in the value of the underlying securities. In addition,
the Fund could be prevented from opening or realizing the benefits of closing
out futures positions because of position limits or limits on daily price
fluctuations imposed by an exchange.
For Federal income tax purposes, the amount, character and timing of
the Fund's gains and/or losses can be affected as a result of futures contracts.
At April 30, 1995, open positions in financial futures contracts were
as follows:
<TABLE>
<CAPTION>
UNREALIZED
EXPIRATION OPEN CONTRACTS POSITION APPRECIATION
- ---------- -------------- -------- -------------
<S> <C> <C> <C>
JUNE 95 90 Treasury Bond(1) LONG $60,313
=======
</TABLE>
(1) Each contract represents $100,000 in par value.
At April 30, 1995, the Fund has deposited in a segregated account
$9,129,000 par value of U.S. Treasury Bond, 11.625% due 11-15-04 to cover margin
requirements on open financial futures contracts.
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS The Fund may enter into forward
foreign currency exchange contracts as a hedge against the effect of
fluctuations in currency exchange rates. A forward foreign currency exchange
contract involves an obligation to purchase or sell a specific currency at a
future date at a set price. The aggregate principal amounts of the contracts are
marked-to-market daily at the applicable foreign currency exchange rates. Any
resulting unrealized gains and losses are included in the determination of the
Fund's daily net assets. The Fund records realized gains and losses at the time
the forward foreign currency contract is closed out or offset by a matching
contract. Risks may arise upon entering these contracts from potential inability
of counterparties to meet the terms of the contract and from unanticipated
movements in the value of a foreign currency relative to the U.S. dollar. These
contracts involve market or credit risk in excess of the unrealized gain or loss
reflected
15
<PAGE> 11
NOTES TO FINANCIAL STATEMENTS
John Hancock Funds - Government Income Fund
in the Fund's Statement of Assets and Liabilities. The Fund may also purchase
and sell forward contracts to facilitate the settlement of foreign currency
denominated portfolio transactions, under which it intends to take delivery of
the foreign currency. Such contracts normally involve no market risk other than
that offset by the currency amount of the underlying transaction.
At April 30, 1995, there were no open forward foreign currency exchange
contracts.
FOREIGN CURRENCY TRANSLATION All assets and liabilities initially expressed in
terms of foreign currencies are translated into U.S.dollars based on London
currency exchange quotations as of 5:00 p.m., London time, on the date of any
determination of the net asset value of the Fund. Transactions affecting
statement of operations accounts and net realized gain/loss on investments are
translated at the rates prevailing at the dates of the transactions.
The Fund does not isolate that portion of the results of operations
resulting from changes in foreign exchange rates on investments from the
fluctuations arising from changes in market prices of securities held. Such
fluctuations are included with the net realized and unrealized gain or loss from
investments.
Reported net realized foreign exchange gains or losses arise from
sales of foreign currency, currency gains or losses realized between the trade
and settlement dates on securities transactions and the difference between the
amounts of dividends, interest, and foreign withholding taxes recorded on the
Fund's books and the U.S. dollar equivalent of the amounts actually received or
paid. Net unrealized foreign exchange gains and losses arise from changes in
the value of assets and liabilities other than investments in securities at
fiscal year end, resulting from changes in the exchange rate.
INVESTMENT TRANSACTIONS Investment transactions are recorded as of the date of
purchase, sale or maturity. Net realized gains and losses on sales of
investments are determined on the identified cost basis for both financial
reporting and federal income tax purposes.
DISCOUNT ON SECURITIES The Fund accretes discount from par value on securities
from either the date of issue or the date of purchase over the life of the
security, as required by the Internal Revenue Code.
FEDERAL INCOME TAXES The Fund's policy is to comply with the requirements of the
Internal Revenue Code that are applicable to regulated investment companies and
to distribute all of its taxable income, including any net realized gain on
investments, to its shareholders. Therefore, no federal income tax provision is
required. The Fund's tax year end is December 31.
DIVIDENDS, DISTRIBUTIONS AND INTEREST Interest income on investment securities
is recorded on the accrual basis. Foreign income may be subject to foreign
withholding taxes which are accrued as applicable.
The Fund records all distributions to shareholders from net investment
income and realized gains on the ex-dividend date. Such distributions are
determined in conformity with income tax regulations, which may differ from
generally accepted accounting principles. Dividends paid by the Fund, if any,
with respect to each class of shares will be calculated in the same manner, at
the same time and will be in the same amount, except for effect of expenses that
may be applied differently to each class as explained previously.
EXPENSES The majority of the expenses of the Trust are directly identifiable to
an individual Fund. Expenses which are not readily identifiable to a specific
Fund are allocated in such a manner as deemed equitable, taking into
consideration, among other things, the nature and type of expense and the
relative sizes of the Fund.
CLASS ALLOCATIONS Income, common expenses and realized and unrealized gains
(losses) are determined at the Fund level and allocated daily to each class of
shares based on the appropriate net assets of the respective classes.
Distribution/service fees if any, are calculated daily at the class level based
on the appropriate net assets of each class and the specific expense rate(s)
applicable to each class.
RECLASSIFICATION Certain reclassifications have been made to 1994 amounts to
permit comparisons to 1995 presentations.
16
<PAGE> 12
NOTES TO FINANCIAL STATEMENTS
John Hancock Funds - Government Income Fund
NOTE B --
MANAGEMENT FEE, ADMINISTRATIVE
SERVICES AND TRANSACTIONS WITH AFFILIATES
AND OTHERS
On December 22, 1994, John Hancock Advisers, Inc. ("the Adviser"), a wholly
owned subsidiary of The Berkeley Financial Group, became the investment adviser
for the Fund with approval of the Trustees and shareholders of the Fund. The
Fund's former investment manager was Transamerica Fund Management Company
("TFMC").
Under the present investment management contract, the Fund pays a
monthly management fee to the Adviser for a continuous investment program
equivalent, to 0.650% of the first $200,000,000 of the Fund's average daily net
asset value, 0.625% of the next $300,000,000 and 0.600% of the Fund's average
daily net asset value in excess of $500,000,000. This fee structure is
consistent with the former agreement with TFMC. For the period ended April 30,
1995, the advisory fee earned by the Adviser and TFMC amounted to $488,064 and
$256,721, respectively, resulting in a total fee of $744,785.
The Adviser and TFMC, for their respective periods, provided
administrative services to the Fund pursuant to an administrative service
agreement through January 16, 1995 on which day the agreement was terminated.
In the event normal operating expenses of the Fund, exclusive of
certain expenses prescribed by state law, are in excess of the most restrictive
state limit where the Fund is registered to sell shares of beneficial interest,
the fee payable to the Adviser will be reduced to the extent of such excess and
the Adviser will make additional arrangements necessary to eliminate any
remaining excess expenses. The current limits are 2.5% of the first $30,000,000
of the Fund's average daily net asset value, 2.0% of the next $70,000,000 and
1.5% of the remaining average daily net asset value.
On December 22, 1994 John Hancock Funds, Inc. ("JH Funds"), a
wholly-owned subsidiary of the Adviser, became the principal underwriter of the
Fund. Prior to this date, Transamerica Fund Distributors, Inc. ("TFD") served
as the principal underwriter and distributor of the Fund. For the period ended
April 30, 1995, JH Funds and TFD received net sales charges of $10,458 with
regard to sales of Class A shares. Out of this amount, $1,121 was retained and
used for printing prospectuses, advertising, sales literature and other
purposes, and $9,337 was paid as sales commissions to unrelated broker-dealers.
Class B shares which are redeemed within six years of purchase will be
subject to a contingent deferred sales charge ("CDSC") at declining rates
beginning at 5.0% of the lesser of the current market value at the time of
redemption or the original purchase cost of the shares being redeemed. Proceeds
from the CDSC are paid to JH Funds, formerly TFD, and are used in whole or in
part to defray its expenses related to providing distribution related services
to the Fund in connection with the sale of Class B shares. For the period ended
April 30, 1995, contingent deferred sales charges amounted to $654,605.
In addition, to compensate JH Funds for the services it provides as
distributor of shares of the Fund, the Fund has adopted a Distribution Plan with
respect to Class A and Class B shares pursuant to Rule 12b-1 under the
Investment Company Act of 1940. Accordingly, the Fund will make payments for
distribution and service expenses which in total will not exceed on an annual
basis 0.25% of the Fund's average daily net assets attributable to Class A
shares and 1.00% of the Fund's average daily net assets attributable to Class B
shares, to reimburse for its distribution/service costs. Up to a maximum of
0.25% of such payments may be service fees as defined by the amended Rules of
Fair Practice of the National Association of Securities Dealers. Under the
amended Rules of Fair Practice, curtailment of a portion of the Fund's 12b-1
payments could occur under certain circumstances. This fee structure and plan is
similar to the former arrangement with TFD.
The Board of Trustees approved a shareholder servicing agreement
between the Fund and John Hancock Investor Services Corporation ("Investor
Services"), a wholly owned subsidiary of The Berkeley Financial Group, for the
period between December 22, 1994 and May 12, 1995, inclusive under which
Investor Services processed telephone transactions on behalf of the Fund. As of
May 15, 1995, the Fund entered into a full service transfer agent agreement
with Investor Services. Prior to this date The Shareholder Services Group
17
<PAGE> 13
NOTES TO FINANCIAL STATEMENTS
John Hancock Funds - Government Income Fund
was the transfer agent. The Fund will pay Investor Services a fee based on
transaction volume and number of shareholder accounts.
A partner with Baker & Botts was an officer of the Trust until
December 22, 1994. During the period ended April 30, 1995, legal fees paid to
Baker & Botts amounted to $2,864.
Mr. Edward J. Boudreau, Jr. is a director and officer of the Adviser
and its affiliates as well as Trustee of the Fund. The compensation of
unaffiliated Trustees is borne by the Fund. Effective with the fees paid for
1995, the unaffiliated Trustees may elect to defer their receipt of this
compensation under the John Hancock Group of Funds Deferred Compensation Plan.
The Fund will make investments into other John Hancock funds, as applicable, to
cover its liability with regard to the deferred compensation. Investments to
cover the Fund's deferred compensation liability will be recorded on the Fund's
books as other assets. The deferred compensation liability will be marked to
market on a periodic basis and income earned by the investment will be recorded
on the Fund's books.
The Fund has an independent advisory board composed of certain
members of the former Transamerica Board of Trustees who provide advice to the
current Trustees in order to facilitate a smooth management transition for
which the Fund pays the advisory board and its counsel a fee.
NOTE C --
INVESTMENT TRANSACTIONS
Purchases and proceeds from sales of securities, other than short-term
obligations, during the period ended April 30, 1995 aggregated $142,813,070 and
$158,520,564, respectively.
The cost of investments owned at April 30, 1995 (including the joint
repurchase agreement) for Federal income tax purposes was $232,674,314. Gross
unrealized appreciation and depreciation of investments aggregated $3,856,408,
and $8,346,105, respectively, resulting in net unrealized depreciation of
$4,489,697.
18
<PAGE> 14
The contents of the Registrant's Registration Statement on Form N-14
(File No. 33-60269) filed with the Securities and Exchange Commission on June
15, 1995 are incorporated herein by reference.
<PAGE> 15
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has caused this Pre-Effective Amendment to its Registration
Statement on Form N-14 to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Boston and The Commonwealth of Massachusetts,
on the 12th day of July, 1995.
JOHN HANCOCK SERIES, INC.
By:/s/Edward J. Boudreau, Jr.
--------------------------------
Edward J. Boudreau, Jr.
Chairman and Director
Pursuant to the requirements of the Securities Act of 1933, this
Pre-Effective Amendment to the Registrant's Registration Statement on Form N-14
has been signed below by the following persons in the capacities and on the
dates indicated:
<TABLE>
<CAPTION>
Signature Title
--------- -----
<S> <C>
/s/Edward J. Boudreau, Jr. Chairman and Director )
- ----------------------------- (Principal Executive )
Edward J. Boudreau, Jr. Officer) )
)
) July 12, 1995
/s/James B. Little Senior Vice President )
- ----------------------------- and Chief Financial )
James B. Little Officer (Principal )
Financial and )
Accounting Officer) )
)
Directors:
James F. Carlin* Director )
- ----------------------------- )
James F. Carlin )
)
</TABLE>
- 2 -
<PAGE> 16
<TABLE>
<CAPTION>
<S> <C>
)
William H. Cunningham* Director )
- ----------------------------- )
William H. Cunningham )
)
Charles L. Ladner* Director )
- ----------------------------- )
Charles L. Ladner )
)
)
Leo E. Linbeck, Jr.* Director )
- ----------------------------- )
Leo E. Linbeck, Jr. )
)
)
Patricia P. McCarter* Director )
- ----------------------------- )
Patricia P. McCarter )
)
)
Steven R. Pruchansky* Director )
- ----------------------------- )
Steven R. Pruchansky )
)
)
Norman H. Smith* Director )
- ----------------------------- )
Norman H. Smith )
)
)
John P. Toolan* Director )
- ----------------------------- )
John P. Toolan )
)
______________
<FN>
*By: /s/Thomas H. Drohan Dated: July 12, 1995
----------------------------------
Thomas H. Drohan, Attorney-in-fact
</TABLE>
- 3 -
