Report
SCUDDER
INVESTMENTS(SM)
[LOGO]
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SECTOR/SPECIALTY
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Scudder Gold Fund
Fund #019
Annual Report
October 31, 1999
The fund seeks maximum return consistent with investing primarily in a portfolio
of gold-related equity securities and gold.
A no-load fund with no commissions to buy, sell, or exchange shares.
<PAGE>
Contents
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4 Letter from the Fund's President
6 Performance Update
8 Portfolio Summary
10 Portfolio Management Discussion
13 Glossary of Investment Terms
14 Investment Portfolio
17 Consolidated Financial Statements
20 Consolidated Financial Highlights
21 Notes to Consolidated Financial Statements
28 Report of Independent Accountants
29 Tax Information
30 Officers and Directors
31 Investment Products and Services
33 Scudder Solutions
2 SCUDDER GOLD FUND
<PAGE>
Scudder Gold Fund
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ticker symbol SCDGX fund number 019
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Date of Inception: 9/2/88
o Scudder Gold Fund posted a 5.65% total return over
its most recent fiscal year ended October 31,
1999. The fund outpaced the -7.98% return of the
Salomon/Smith Barney Gold Index during the
12-month period, and placed in the top 30% of 41
similar gold-oriented mutual funds as tracked by
Lipper Analytical Services, Inc.
Total Net Assets as of 10/31/99: $116.3 million
o Gold bullion remained within a $250-$300 trading
range during the period, benefiting from the
European Central Bank's September 26th
announcement that it would place limits on its
gold sales.
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Total Returns for Gold and Gold Funds
(Periods ended October 31, 1999)
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THE ORIGINAL DOCUMENT CONTAINS A BAR CHART HERE
BAR CHART DATA:
Six months Twelve months
--------------- ----------------
Gold bullion, London p.m. fix 4.36% 2.33%
Toronto Stock Exchange Gold Index -11.88% -17.92%
Salomon/Smith Barney Gold Index -5.07% -7.98%
Lipper Average for Gold-Oriented Funds -3.77% -1.66%
Scudder Gold Fund -3.86% 5.65%
SCUDDER GOLD FUND 3
<PAGE>
Letter from the Fund's President
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[PHOTO]
Lynn S. Birdsong
President,
Scudder Gold Fund
Dear Shareholders,
We are pleased to report to you concerning Scudder Gold Fund's most recent
12-month performance. The fund managed to post a modest return during a period
when gold remained within its trading range and several major gold producers
suffered significant losses due to forward selling. The fund posted a 5.65%
total return over the period, outpacing the -1.66% average of similar gold funds
tracked by Lipper.
Gold has faced an uphill battle for the past four years, since the drive for
European union caused several major European central banks to sell substantial
gold reserves to erase a portion of their budget deficits. More recently, the
European Central Bank's September 1999 announcement that it would limit its
annual gold sales over the next five years gave an immediate boost to gold's
price, and provided some cause for optimism longer term. More fundamental signs
that we believe would point to future increases in gold prices are any spikes in
inflation, and a continuation of the economic turnaround in Asia, the premier
consumer of gold jewelry. For more information on Scudder Gold Fund's
performance, portfolio strategy, and outlook, please read the Portfolio
Management Discussion that begins on page 10.
It should be noted that Daniel Pierce retired in June of this year as President
of Scudder Gold Fund, at which time I assumed that role and its
responsibilities. We are fortunate that Dan's longstanding affiliation with
Scudder is ongoing, and that we will
4 SCUDDER GOLD FUND
<PAGE>
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continue to benefit from his counsel going forward. I am pleased to join the
fund's team in this capacity, and look forward to serving your interests.
If you have any questions regarding Scudder Gold Fund or any other Scudder fund,
please call an Investor Relations representative at 1-800-225-2470. Or visit
Scudder's Web site at www.scudder.com.
Sincerely,
/s/ Lynn S. Birdsong
Lynn S. Birdsong
President,
Scudder Gold Fund
SCUDDER GOLD FUND 5
<PAGE>
Performance Update
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October 31, 1999
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Growth of a $10,000 Investment
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THE ORIGINAL DOCUMENT CONTAINS A LINE CHART HERE
LINE CHART DATA:
Scudder Gold Fund S&P 500 Index*
'89 10000 10000
'90 8635 9253
'91 8564 12351
'92 7907 13584
'93 11033 15613
'94 12016 16217
'95 11637 20504
'96 17189 25444
'97 11725 33617
'98 8573 41011
'99 9057 51543
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Fund Index Comparison
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Total Return
Growth of Average
Period ended 10/31/1999 $10,000 Cumulative Annual
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Scudder Gold Fund
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1 year $ 10,565 5.65% 5.65%
5 year $ 7,538 -24.62% -5.50%
10 year $ 9,057 -9.43% -.99%
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S&P 500 Index*
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1 year $ 12,568 25.68% 25.68%
5 year $ 31,783 217.83% 26.00%
10 year $ 51,543 415.43% 17.81%
* The Standard & Poor's 500 Index is a capitalization-weighted index of 500
stocks. The index is designed to measure performance of the broad domestic
economy through changes in the aggregate market value of 500 stocks
representing all major industries. Index returns assume reinvestment of
dividends and, unlike Fund returns, do not reflect any fees or expenses.
6 SCUDDER GOLD FUND
<PAGE>
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Returns and Per Share Information
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Yearly periods ended October 31
THE ORIGINAL DOCUMENT CONTAINS A BAR CHART HERE
BAR CHART DATA:
Scudder Gold Fund S&P 500 Index*
1990 -13.65 -7.47
1991 -.82 33.48
1992 -7.67 9.98
1993 39.53 14.94
1994 8.91 3.87
1995 -3.16 26.44
1996 47.71 24.09
1997 -31.79 32.12
1998 -26.88 21.99
1999 5.65 25.68
<TABLE>
<CAPTION>
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Fund Total
Return (%) -13.65 -.82 -7.67 39.53 8.91 -3.16 47.71 -31.79 -26.88 5.65
Index Total
Return (%) -7.47 33.48 9.98 14.94 3.87 26.44 24.09 32.12 21.99 25.68
Net Asset
Value ($) 9.73 9.65 8.91 12.27 12.74 11.81 13.64 8.88 6.37 6.73
Income
Dividends ($) .06 -- -- .15 .34 .14 2.80 .53 .14 --
Capital Gains
Distributions ($) .04 -- -- -- .31 .40 .58 .07 -- --
</TABLE>
* The Standard & Poor's 500 Index is a capitalization-weighted index of 500
stocks. The index is designed to measure performance of the broad domestic
economy through changes in the aggregate market value of 500 stocks
representing all major industries. Index returns assume reinvestment of
dividends and, unlike Fund returns, do not reflect any fees or expenses.
All performance is historical, assumes reinvestment of all dividends and
capital gains, and is not indicative of future results. Investment return
and principal value will fluctuate, so an investor's shares, when
redeemed, may be worth more or less than when purchased.
SCUDDER GOLD FUND 7
<PAGE>
Portfolio Summary
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October 31, 1999
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Diversification
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As a percentage of net assets
[PIE CHART]
Equity Holdings 86% The fund held a modest
Cash Equivalents, net 14% cash position at the close
- -------------------------------- of the period.
100%
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Quality Distributions
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Tier breakdown of the Fund's
common stocks
[PIE CHART]
Tier I During the period, the
Premier gold producing fund continued its shift
companies 76% into additional Tier I and
Tier II producers with
Tier II strong balance sheets and
Major established gold low production costs.
producers 13%
Tier III
Junior gold producers with
medium cost production 2%
Tier IV
Companies with some gold
production on stream or
in startup 4%
Tier V
Primarily exploration
companies with or without
mineral reserves 5%
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100%
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8 SCUDDER GOLD FUND
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Ten Largest Equity Holdings
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(60% of Portfolio)
We continued to focus on companies such as De Beers, the fund's third largest
holding, that we feel are well positioned to withstand the current low level of
gold prices.
1. Barrick Gold Corp.
Gold exploration and production in North and South America
2. Placer Dome Inc.
Gold, silver and copper mining company
3. De Beers
Diamond mining
4. Newmont Mining Corp.
International gold exploration and mining company
5. Anglo American Platinum Corp.
Platinum mining company
6. Franco-Nevada Mining Corp., Ltd.
Gold mining company
7. Homestake Mining Co.
Major international gold producer
8. Lonmin PLC
Miner of platinum, gold and coal
9. AngloGold Ltd.
Gold exploration and mining company
10. Impala Platinum Holdings Ltd.
Platinum, nickel and copper mining
For more complete details about the Fund's investment portfolio, see page 14. A
quarterly Fund Summary and Portfolio Holdings are available upon request.
SCUDDER GOLD FUND 9
<PAGE>
Portfolio Management Discussion
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October 31, 1999
Dear Shareholders:
Scudder Gold Fund posted a 5.65% total return over its most recent fiscal year
ended October 31, 1999, as gold bullion remained in a $250-$300 trading range.
The fund outpaced the -7.98% return of the Salomon/Smith Barney Gold Index
during the period, and placed in the top 30% of 41 similar gold-oriented mutual
funds as tracked by Lipper Analytical Services, Inc. Over the period, the fund's
net asset value increased from $6.37 to $6.73 per share.
Mixed News for Gold Investors
Gold bullion increased slightly in price, from $292.30 to $299.10, over the
12-month period. It began to decline in price in November 1998 as rumors of
impending International Monetary Fund (IMF) gold sales as well as forward sales
by several large gold-producing firms hurt the gold market. (In "selling
forward," gold producers sell on the open market gold that will not be mined for
between six months and four years, similar to "selling short" in the stock
market; as with short sales, a forward sale can be canceled through a "buyback"
transaction. Gold producers use the forward markets to hedge against falling
gold prices and to lock in profits for mining projects.)
A more positive development occurred on September 26, 1999, when the European
Central Bank committed itself to limits on gold sales of 400 tons annually. The
announcement provided an immediate boost to gold prices and to market
psychology, as intermittent and unpredictable European central bank sales had
continually undermined the gold market and driven prices down for the past four
years.
Pursuing a Diversification Strategy
Scudder Gold Fund seeks maximum return by investing in a portfolio of primarily
gold-related investments. Over the period, the fund continued its shift into
additional Tier I and Tier II gold stocks -- premier and major established gold
producers with strong balance sheets and low
10 SCUDDER GOLD FUND
<PAGE>
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production costs. We continued to focus on producers that we feel are well
positioned to withstand the current low level of gold prices. Along these lines,
the fund took a significant position in De Beers during the period. De Beers is
a major diamond producer that represents approximately 10% of the fund's
benchmark index. In addition, the fund sold most of its Ashanti Goldfields
position before the firm announced significant losses due to forward sales. For
diversification purposes, we also trimmed the fund's significant overweight
position in Stillwater Mining. The fund also continues its broad diversification
by region, with investments in 12 regions of the world.
Outlook
Over the coming months, we expect that gold bullion will remain within its
current trading range. For gold to move up in price, we would look for signs of
an upturn in inflation, and for continued economic recovery in Asia, the world's
largest consumer of gold jewelry. If gold remains in its current range or dips
lower, gold producers will find it difficult to post positive financial results.
Encouraging signs for gold stocks include the retraction of forward sales by
many major firms, and the fact that jewelry fabrication demand continues to
exceed the supply of gold. We believe Scudder Gold Fund remains an appropriate
investment for those seeking portfolio diversification, a hedge against
inflation, and participation in the world's gold and precious metals markets.
Thank you for investing with Scudder.
Sincerely,
Your Portfolio Management Team
/s/ Joann M. Barry /s/ Robert D. Hardiman
Joann M. Barry Robert D. Hardiman
SCUDDER GOLD FUND 11
<PAGE>
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Scudder Gold Fund:
A Team Approach to Investing
Scudder Gold Fund is managed by a team of Scudder Kemper Investments, Inc. (the
"Adviser") professionals, each of whom plays an important role in the fund's
management process. Team members work together to develop investment strategies
and select securities for the fund's portfolio. They are supported by the
Adviser's large staff of economists, research analysts, traders, and other
investment specialists who work in our offices across the United States and
abroad. We believe our team approach benefits fund investors by bringing
together many disciplines and leveraging our extensive resources.
[PHOTO]
Joann M. Barry
Lead portfolio manager Joann M. Barry, who joined the Adviser in 1995, assumed
responsibility for the fund's day-to-day management and overall investment
strategies in 1999. Ms. Barry has ten years of industry experience as an analyst
covering the energy, transports, and insurance sectors.
[PHOTO]
Robert D. Hardiman
Portfolio manager Robert D. Hardiman joined the Adviser in 1999. Mr. Hardiman
has 22 years of experience as an analyst specializing in the chemical industry.
12 SCUDDER GOLD FUND
<PAGE>
Glossary of Investment Terms
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Central Bank A national bank that issues currency, administers monetary
policy (including open market operations), holds deposits
representing the reserves of other banks, and engages in
operations designed to facilitate the conducting of business
and the protection of the public interest. In the United
States, central banking is a function of the Federal Reserve
system.
Diversification The spreading of risk by putting assets in several categories
of assets -- stocks, bonds, money market instruments, and
precious metals, for example.
Inflation An overall increase in the prices of goods and services, as
happens when business and consumer spending increases relative
to the supply of goods available in the marketplace -- in
other words, when too much money is chasing too few goods.
Liquidity A stock that is liquid has enough shares outstanding and a
sufficiently substantial market capitalization to allow large
purchases and sales to occur without causing a significant
move in its market price.
Market The value of a company's outstanding shares of common stock,
Capitalization determined by multiplying the number of shares outstanding by
the share price (shares x price = market capitalization).
Net Asset The price per share of a mutual fund based on the sum of the
Value (NAV) market value of all the securities owned by the fund divided
by the number of outstanding shares.
Total Return The most common yardstick to measure the performance of a
fund. Total return -- annualized or compound -- is based on a
combination of share price changes plus income and capital
gain distributions, if any, expressed as a percentage gain or
loss in value.
(Source: Scudder Kemper Investments, Inc.; Barron's Dictionary of Finance and
Investment Terms)
SCUDDER GOLD FUND 13
<PAGE>
Investment Portfolio as of October 31, 1999
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<TABLE>
<CAPTION>
Principal Market
Amount ($) Value ($)
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<S> <C> <C>
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Repurchase Agreements 3.0%
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Repurchase Agreement with Donaldson, Lufkin & Jenrette
dated 10/29/1999 at 5.2%, to be repurchased at
$3,470,503 on 11/1/1999, collateralized by a
$3,473,000 U.S. Treasury Inflationary Index Bond, ------------
3.625%, 1/15/2008 (Cost $3,469,000) ..................... 3,469,000 3,469,000
------------
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Short Term Notes 13.4%
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Federal Home Loan Mortgage Corp., Discount Note, ------------
5.16%**, 11/1/1999 (Cost $15,648,000) ................... 15,648,000 15,648,000
------------
<CAPTION>
Shares
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<S> <C> <C>
- -------------------------------------------------------------------------------------------
Common Stocks 85.8%
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Australia 5.6%
Acacia Resources Ltd. (Gold and mineral exploration
company with operations throughout Australia) ........... 800,000 1,416,466
Delta Gold NL (Emerging junior exploration company with
important platinum property in Zimbabwe) ................ 400,000 675,114
Newcrest Mining, Ltd.* (Senior gold producer and
exploration company) .................................... 400,000 1,123,492
Normandy Mining Ltd. (Mining and oil enterprises) .......... 4,010,214 3,039,386
Resolute Ltd. (Exploration and production of gold and
other minerals) ......................................... 700,000 240,748
------------
6,495,206
------------
Bolivia 0.1%
Corriente Resources, Inc.* (Mining and processing of gold,
bismuth, tin and tungsten in South America) ............. 181,000 79,963
------------
Canada 7.4%
Franco-Nevada Mining Corp., Ltd. (Gold mining
company) ................................................ 308,000 5,714,946
Goldcorp Inc. "A"* (Owner and operator of gold mines) ...... 200,000 1,291,375
Kinross Gold Corp.* (Gold mining company, with interests
in Zimbabwe) ............................................ 600,000 1,529,260
Repadre Capital Corp.* (Junior gold royalty company) ....... 50,000 67,967
------------
8,603,548
------------
</TABLE>
The accompanying notes are an integral part of the
consolidated financial statements.
14 SCUDDER GOLD FUND
<PAGE>
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<TABLE>
<CAPTION>
Market
Shares Value ($)
- -------------------------------------------------------------------------------------------
<S> <C> <C>
Ghana 0.6%
Ranger Minerals NL (Gold producer and exploration
company) ................................................ 394,238 703,053
------------
Indonesia 3.0%
Freeport McMoRan Copper & Gold, Inc. "A"* (Mining
company) ................................................ 244,700 3,456,388
------------
Niger 0.6%
Etruscan Resources, Inc.* (Exploration and development
of gold prospect) ....................................... 1,040,500 714,270
------------
Peru 0.1%
Compania de Minas Buenaventura S.A. "B" (ADR) (Mining
company) ................................................ 5,400 91,800
------------
South Africa 30.7%
Anglo American Platinum Corp. (Platinum mining
company) ................................................ 264,500 7,622,975
AngloGold Ltd. (ADR) (Gold exploration and mining
company) ................................................ 124,000 3,479,750
De Beers, Centenary Linked Shares (Diamond mining) ......... 387,100 10,576,468
Gold Fields Ltd. (Gold mining, development and
exploration company) .................................... 697,499 3,339,000
Gold Fields Ltd. (ADR) ..................................... 150,000 712,500
Impala Platinum Holdings Ltd. (Platinum, nickel and
copper mining) .......................................... 100,000 3,464,952
Kroondal Platinum Mines Ltd. (Warrants)* expire 8/31/2000
(Platinum, palladium and rhodium mining company) ........ 450,000 296,019
Kroondal Platinum Mines, Ltd.* ............................. 1,090,000 2,262,884
Lonmin PLC (Miner of platinum, gold and coal) .............. 394,900 3,975,131
------------
35,729,679
------------
United States 2.3%
Piedmont Mining Co. Inc.* (Gold mining and development
company in the Carolinas) (b) ........................... 1,500,000 202,500
Stillwater Mining Co.* (Exploration and development of
mines in Montana producing platinum, palladium and
associated metals) ...................................... 98,181 1,975,893
X-Cal Resources Ltd.* (Gold exploration and mining in
Nevada and British Columbia) (b) ........................ 1,993,286 487,720
------------
2,666,113
------------
</TABLE>
The accompanying notes are an integral part of the
consolidated financial statements.
SCUDDER GOLD FUND 15
<PAGE>
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<TABLE>
<CAPTION>
Market
Shares Value ($)
- -------------------------------------------------------------------------------------------
<S> <C> <C>
West Africa 2.1%
IAMGOLD* (Development and funding of precious metal
mining in west Africa) ................................. 1,088,000 2,440,291
------------
Zimbabwe 0.1%
Zimbabwe Platinum Mines Ltd.* (Mining company which
explores for platinum) ................................. 248,000 102,668
------------
International 33.2%
Apex Silver Mines Ltd.* (Developer of silver properties in
South America, Central America, and Central Asia) ....... 48,300 655,069
Barrick Gold Corp. (Gold exploration and production in
North and South America) ................................ 654,100 11,978,204
Battle Mountain Gold Co. "A" (Gold, silver and copper
mining and processing) .................................. 319,000 857,313
Homestake Mining Co. (Major international gold
producer) ............................................... 600,000 5,025,000
Newmont Mining Corp. (International gold exploration and
mining company) ......................................... 350,000 7,678,125
Placer Dome Inc. (Gold, silver and copper mining
company) ................................................ 900,000 11,316,523
Solitario Resources Corp.* (Precious and base metals
exploration company primarily in Argentina and Peru) .... 462,247 439,846
TVX Gold, Inc.* (International gold and silver mining) ..... 700,000 670,835
Vengold Inc.* (Gold exploration and development company
with interests in Papua New Guinea, Venezuela and
Indonesia) .............................................. 283,400 39,487
------------
38,660,402
------------
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Total Common Stocks (Cost $86,937,366) 99,743,381
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<CAPTION>
% of
Net Assets
- -------------------------------------------------------------------------------------------
<S> <C> <C>
Total Portfolio (Cost $106,054,366) (a) .................... 102.2% 118,860,381
Other Assets and Liabilities, Net .......................... -2.2% (2,570,963)
- -------------------------------------------------------------------------------------------
Net Assets ................................................. 100.0% 116,289,418
- -------------------------------------------------------------------------------------------
</TABLE>
* Non-income producing security or commodity.
** Annualized yield at time of purchase; not a coupon rate. (Unaudited)
(a) The cost for federal income tax purposes was $113,774,181. At October 31,
1999, net unrealized appreciation for all investment securities based on
tax cost was $5,086,200. This consisted of aggregate gross unrealized
appreciation for all investments in which there was an excess of market
value over tax cost of $16,988,571 and aggregate gross unrealized
depreciation for all investment securities in which there was an excess of
tax cost over market value of $11,902,371.
(b) Affiliated issuers (see Notes to Consolidated Financial Statements).
The accompanying notes are an integral part of the
consolidated financial statements.
16 SCUDDER GOLD FUND
<PAGE>
Financial Statements
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Consolidated Statement of Assets and Liabilities as of October 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Assets
- ----------------------------------------------------------------------------------------------
Investments, at market:
Unaffiliated issuers (identified cost $103,710,802) .......................... $ 118,170,161
Affiliated issuers (identified cost $2,343,564) .............................. 690,220
-------------
Total investments, at market (identified cost $106,054,366) .................. 118,860,381
Receivable for Fund shares sold .............................................. 189,780
Dividends and interest receivable ............................................ 82,199
Receivable for investments sold .............................................. 2,060,781
Other assets ................................................................. 680
-------------
Total assets ................................................................. 121,193,821
Liabilities
- ----------------------------------------------------------------------------------------------
Due to custodian bank ........................................................ 902
Payable for investments purchased ............................................ 3,989,060
Payable for Fund shares redeemed ............................................. 436,271
Accrued management fee ....................................................... 110,735
Other payables and accrued expenses .......................................... 367,435
-------------
Total liabilities ............................................................ 4,904,403
- ----------------------------------------------------------------------------------------------
Net assets, at market value .................................................. $ 116,289,418
- ----------------------------------------------------------------------------------------------
Net Assets
- ----------------------------------------------------------------------------------------------
Net assets consist of:
Undistributed net investment income .......................................... 1,191,886
Net unrealized appreciation (depreciation) on:
Investment securities ...................................................... 12,806,015
Foreign currency related transactions ...................................... (3,895)
Accumulated net realized gain (loss) ......................................... (96,433,884)
Paid-in capital .............................................................. 198,729,296
- ----------------------------------------------------------------------------------------------
Net assets, at market value .................................................. $ 116,289,418
- ----------------------------------------------------------------------------------------------
Net Asset Value
- ----------------------------------------------------------------------------------------------
Net Asset Value, offering and redemption price per share ($116,289,418 /
17,269,141 shares of capital stock outstanding, $.01 par value, 100,000,000 -------------
number of shares of capital stock authorized) ............................. $ 6.73
-------------
</TABLE>
The accompanying notes are an integral part of the
consolidated financial statements.
SCUDDER GOLD FUND 17
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Consolidated Statement of Operations for the year ended October 31, 1999
- --------------------------------------------------------------------------------
Investment Income (Loss)
- --------------------------------------------------------------------------------
Income:
Dividends (net of foreign taxes withheld of $59,108) ........... $ 1,726,164
Interest ....................................................... 641,879
------------
2,368,043
------------
Expenses:
Management fee ................................................. 1,150,027
Services to shareholders ....................................... 603,099
Custodian and accounting fees .................................. 185,410
Directors' fees and expenses ................................... 50,054
Auditing ....................................................... 82,274
Reports to shareholders ........................................ 90,808
Registration fees .............................................. 44,393
Legal .......................................................... 80,259
Other .......................................................... 22,780
------------
2,309,104
- --------------------------------------------------------------------------------
Net investment income (loss) ................................... 58,939
- --------------------------------------------------------------------------------
Realized and unrealized gain (loss) on investment transactions
- --------------------------------------------------------------------------------
Net realized gain (loss) from:
Investments -- Unaffiliated issuers ............................ (4,906,206)
Investments -- Affiliated issuers .............................. (544,753)
Platinum ....................................................... 4,482
Futures ........................................................ 34,173
Written options ................................................ 140,750
Foreign currency related transactions .......................... 91,081
------------
(5,180,473)
------------
Net unrealized appreciation (depreciation) during the period on:
Investments .................................................... 11,339,232
Platinum ....................................................... 73,613
Futures ........................................................ (43,180)
Foreign currency related transactions .......................... (44,779)
------------
11,324,886
- --------------------------------------------------------------------------------
Net gain (loss) on investment transactions ..................... 6,144,413
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from operations $ 6,203,352
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the
consolidated financial statements.
18 SCUDDER GOLD FUND
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Consolidated Statement of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Four Months
Year Ended Ended
October 31, October 31, Year Ended
Increase (Decrease) in Net Assets 1999 1998 June 30, 1998
- ------------------------------------------------------------------------------------
<S> <C> <C> <C>
Operations:
Net investment income (loss) ..... $ 58,939 $ (31,517) $ 64,784
Net realized gain (loss) from
investment transactions ....... (5,180,473) (27,938,959) (50,731,480)
Net unrealized appreciation
(depreciation) on investment
transactions during the period 11,324,886 26,737,732 (12,911,654)
------------- ------------- -------------
Net increase (decrease) in net
assets resulting from
operations .................... 6,203,352 (1,232,744) (63,578,350)
------------- ------------- -------------
Distributions to shareholders in
excess of net investment income -- -- (2,264,120)
------------- ------------- -------------
Fund share transactions:
Proceeds from shares sold ........ 441,850,053 273,681,361 749,811,359
Net asset value of shares issued
to shareholders in
reinvestment of distributions . -- -- 2,054,132
Cost of shares redeemed .......... (462,160,899) (274,183,250) (717,824,287)
------------- ------------- -------------
Net increase (decrease) in net
assets from Fund share
transactions .................. (20,310,846) (501,889) 34,041,204
------------- ------------- -------------
Increase (decrease) in net assets (14,107,494) (1,734,633) (31,801,266)
Net assets at beginning of period 130,396,912 132,131,545 163,932,811
Net assets at end of period
(including undistributed net
investment income of
$1,191,886, and distributions
in excess of net investment
income of $464,510 and ------------- ------------- -------------
$7,582,297, respectively) ..... $ 116,289,418 $ 130,396,912 $ 132,131,545
------------- ------------- -------------
Other Information
- ------------------------------------------------------------------------------------
Increase (decrease) in Fund shares
Shares outstanding at beginning
of period ..................... 20,470,266 19,861,886 15,622,172
------------- ------------- -------------
Shares sold ...................... 68,747,856 43,924,388 92,092,490
Shares issued to shareholders in
reinvestment of distributions . -- -- 282,938
Shares redeemed .................. (71,948,981) (43,316,008) (88,135,714)
------------- ------------- -------------
Net increase (decrease) in Fund
shares ........................ (3,201,125) 608,380 4,239,714
Shares outstanding at end of ------------- ------------- -------------
period ........................ 17,269,141 20,470,266 19,861,886
------------- ------------- -------------
</TABLE>
The accompanying notes are an integral part of the
consolidated financial statements.
SCUDDER GOLD FUND 19
<PAGE>
Consolidated Financial Highlights
- --------------------------------------------------------------------------------
The following table includes selected data for a share outstanding throughout
each period (a) and other performance information derived from the consolidated
financial statements.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------
1999(b) 1998(c) 1998(d) 1997(d) 1996(d) 1995(d)
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of
period $ 6.37 $ 6.65 $ 10.49 $ 15.34 $ 12.86 $ 12.64
-----------------------------------------------------------------
Income (loss) from investment
operations:
Net investment income (loss) .00 .00 .00 (.08) (.09) (.08)
Net realized and unrealized
gain (loss) on investment
transactions .36 (.28) (3.70) (2.12) 4.28 1.02
-----------------------------------------------------------------
Total from investment
operations .36 (.28) (3.70) (2.20) 4.19 .94
Less distributions:
In excess of net investment
income -- -- (.14) (2.39) (1.08) (.25)
From net realized gains on
investment transactions -- -- -- (.26) (.63) (.47)
-----------------------------------------------------------------
Total distributions -- -- (.14) (2.65) (1.71) (.72)
Net asset value, end of period $ 6.73 $ 6.37 $ 6.65 $ 10.49 $ 15.34 $ 12.86
=================================================================
Total Return (%) 5.65 -4.21** -35.45 -17.72 36.91 7.50
Ratios and Supplemental Data
- --------------------------------------------------------------------------------------------------
Net assets, end of period
($ millions) 116 130 132 164 173 126
Ratio of operating expenses to
average daily net assets (%) 2.01 2.13* 1.82 1.60 1.50 1.65
Ratio of net investment income
(loss) to average daily net
assets (%) .05 (.08)* .04 (.62) (.61) (.69)
Portfolio turnover rate (%) 90.7 153.6* 68.3 38.9 29.7 42.0
</TABLE>
* Annualized
** Not annualized
(a) Based on monthly average shares outstanding during the period.
(b) Year ended October 31, 1999.
(c) Four months ended October 31, 1998. On September 15, 1998 the Board of
Directors of the Fund changed the fiscal year end from June 30 to October
31.
(d) Years ended June 30.
20 SCUDDER GOLD FUND
<PAGE>
Notes to Consolidated Financial Statements
- --------------------------------------------------------------------------------
October 31, 1999
A. Significant Accounting Policies
Scudder Gold Fund (the "Fund") is a non-diversified series of Scudder Mutual
Funds, Inc. (the "Corporation") which is registered under the Investment Company
Act of 1940, as amended (the "1940 Act"), as an open-end management investment
company organized as a Maryland Corporation.
The Fund's financial statements are prepared in accordance with generally
accepted accounting principles which require the use of management estimates.
The policies described below are followed consistently by the Fund in the
preparation of its financial statements.
Principles of Consolidation. The consolidated financial statements of the Fund
include the accounts of the Fund and Scudder Precious Metals, Inc., a
wholly-owned subsidiary of the Corporation, whose principal assets are precious
metals. All intercompany accounts and transactions have been eliminated.
Security Valuation. Investments are stated at value determined as of the close
of regular trading on the New York Stock Exchange. Securities which are traded
on U.S. or foreign stock exchanges are valued at the most recent sale price
reported on the exchange on which the security is traded most extensively. If no
sale occurred, the security is then valued at the calculated mean between the
most recent bid and asked quotations. If there are no such bid and asked
quotations, the most recent bid quotation is used. Securities quoted on the
Nasdaq Stock Market ("Nasdaq"), for which there have been sales, are valued at
the most recent sale price reported. If there are no such sales, the value is
the most recent bid quotation. Securities which are not quoted on Nasdaq but are
traded in another over-the-counter market are valued at the most recent sale
price, or if no sale occurred, at the calculated mean between the most recent
bid and asked quotations on such market. If there are no such bid and asked
quotations, the most recent bid quotation shall be used.
Portfolio debt securities purchased with an original maturity greater than sixty
days are valued by pricing agents approved by the officers of the Corporation,
whose quotations reflect broker/dealer-supplied valuations and electronic data
processing techniques. If the pricing agents are unable to provide such
quotations, the most recent bid quotation supplied by a bona fide market maker
shall be used. Money market instruments purchased with an original maturity of
sixty days or less are valued at amortized cost.
SCUDDER GOLD FUND 21
<PAGE>
- --------------------------------------------------------------------------------
All other securities are valued at their fair value as determined in good faith
by the Valuation Committee of the Board of Directors.
Precious Metals Valuation. Gold, silver, platinum and palladium bullion shall be
valued based on the London Fixing or, if there is no London Fixing available, on
the last spot settlement; coins and precious metals other than gold, silver,
platinum and palladium bullion shall be valued at the calculated mean between
the most recent bid and asked market quotations or, if there are no such bid and
ask quotations available simultaneously, at the most recent bid quotation
provided by a bona fide market maker at the time of valuation.
Foreign Currency Translations. The books and records of the Fund are maintained
in U.S. dollars. Investment securities and other assets and liabilities
denominated in a foreign currency are translated into U.S. dollars at the
prevailing exchange rates at period end. Purchases and sales of investment
securities, income and expenses are translated into U.S. dollars at the
prevailing exchange rates on the respective dates of the transactions.
Net realized and unrealized gains and losses on foreign currency transactions
represent net gains and losses between trade and settlement dates on securities
transactions, the disposition of forward foreign currency exchange contracts and
foreign currencies, and the difference between the amount of net investment
income accrued and the U.S. dollar amount actually received. That portion of
both realized and unrealized gains and losses on investments that results from
fluctuations in foreign currency exchange rates is not separately disclosed but
is included with net realized and unrealized gains and losses on investment
securities.
Repurchase Agreements. The Fund may enter into repurchase agreements with
certain banks and broker/dealers whereby the Fund, through its custodian or
sub-custodian bank, receives delivery of the underlying securities, the amount
of which at the time of purchase and each subsequent business day is required to
be maintained at such a level that the market value is equal to at least the
principal amount of the repurchase price plus accrued interest.
Options. An option contract is a contract in which the writer of the option
grants the buyer of the option the right to purchase from (call option), or sell
to (put option), the writer a designated instrument at a specified price within
a specified period of time. Certain options, including options on indices, will
require cash settlement by the Fund if the option is exercised. During the
period, the Fund purchased put options on securities and wrote call options on
securities as a hedge against potential adverse price movements in the value
22 SCUDDER GOLD FUND
<PAGE>
- --------------------------------------------------------------------------------
of portfolio assets. In addition, during the period, the Fund wrote put options
on securities to enhance potential gains.
The liability representing the Fund's obligation under an exchange traded
written option or investment in a purchased option is valued at the last sale
price or, in the absence of a sale, the mean between the closing bid and asked
prices or at the most recent asked price (bid for purchased options) if no bid
and asked price are available. Over-the-counter written or purchased options are
valued using dealer supplied quotations. Gain or loss is recognized when the
option contract expires or is closed.
If the Fund writes a covered call option, the Fund foregoes, in exchange for the
premium, the opportunity to profit during the option period from an increase in
the market value of the underlying security above the exercise price. If the
Fund writes a put option it accepts the risk of a decline in the market value of
the underlying security below the exercise price. Over-the-counter options have
the risk of the potential inability of counterparties to meet the terms of their
contracts. The Fund's maximum exposure to purchased options is limited to the
premium initially paid. In addition, certain risks may arise upon entering into
option contracts including the risk that an illiquid secondary market will limit
the Fund's ability to close out an option contract prior to the expiration date
and that a change in the value of the option contract may not correlate exactly
with changes in the value of the securities or currencies hedged.
Futures Contracts. A futures contract is an agreement between a buyer or seller
and an established futures exchange or its clearinghouse in which the buyer or
seller agrees to take or make a delivery of a specific amount of a financial
instrument at a specified price on a specific date (settlement date).
Upon entering into a futures contract, the Fund is required to deposit with a
financial intermediary an amount ("initial margin") equal to a certain
percentage of the face value indicated in the futures contract. Subsequent
payments ("variation margin") are made or received by the Fund dependent upon
the daily fluctuations in the value of the underlying security and are recorded
for financial reporting purposes as unrealized gains or losses by the Fund. When
entering into a closing transaction, the Fund will realize a gain or loss equal
to the difference between the value of the futures contract to sell and the
futures contract to buy. Futures contracts are valued at the most recent
settlement price.
SCUDDER GOLD FUND 23
<PAGE>
- --------------------------------------------------------------------------------
Certain risks may arise upon entering into futures contracts, including the risk
that an illiquid secondary market will limit the Fund's ability to close out a
futures contract prior to the settlement date and that a change in the value of
a futures contract may not correlate exactly with the changes in the value of
the securities or currencies hedged. When utilizing futures contracts to hedge,
the Fund gives up the opportunity to profit from favorable price movements in
the hedged positions during the term of the contract.
Federal Income Taxes. The Fund's policy is to comply with the requirements of
the Internal Revenue Code, as amended, which are applicable to regulated
investment companies and to distribute all of its taxable income to its
shareholders. Accordingly, the Fund paid no federal income taxes and no federal
income tax provision was required.
At October 31, 1999 the Fund had a net tax basis capital loss carryforward of
approximately $88,879,000 which may be applied against any realized net taxable
capital gains of each succeeding year until fully utilized or until October 31,
2005 ($26,073,000), October 31, 2006 ($52,412,000) or October 31, 2007
($10,394,000), the respective expiration dates.
Distribution of Income and Gains. Distributions of net investment income, if
any, are made annually. Net realized gains from investment transactions, in
excess of available capital loss carryforwards, would be taxable to the Fund if
not distributed, and, therefore, will be distributed to shareholders at least
annually.
The timing and characterization of certain income and capital gains
distributions are determined annually in accordance with federal tax regulations
which may differ from generally accepted accounting principles. These
differences primarily relate to investments in passive foreign investment
companies and certain securities sold at a loss. As a result, net investment
income (loss) and net realized gain (loss) on investment transactions for a
reporting period may differ significantly from distributions during such period.
Accordingly, the Fund may periodically make reclassifications among certain of
its capital accounts without impacting the net asset value of the Fund.
Investment Transactions and Investment Income. Investment transactions are
accounted for on the trade date. Interest income is recorded on the accrual
basis. Dividend income is recorded on the ex-dividend date. Certain dividends
from foreign securities may be recorded subsequent to the ex-dividend date as
24 SCUDDER GOLD FUND
<PAGE>
- --------------------------------------------------------------------------------
soon as the Fund is informed of such dividends. Realized gains and losses from
investment transactions are recorded on an identified cost basis.
All discounts and premiums are accreted or amortized for both tax and financial
reporting purposes.
B. Purchases and Sales
During the year ended October 31, 1999, purchases and sales of investment
securities (excluding short-term investments) aggregated $94,570,306 and
$116,939,160, respectively. During the year ended October 31, 1999 the aggregate
value of platinum sold was $729,966.
The aggregate face value of futures contracts closed during the year ended
October 31, 1999 was $5,843,976. There were no futures contracts opened during
the year.
Transactions in written options during the year ended October 31, 1999 were:
Options on Securities
----------------------------
Premiums
Contracts Received ($)
----------- -------------
Outstanding at October 31, 1998 ................ -- --
Written ........................................ 2,000 353,375
Exercised ...................................... (528) (110,791)
Expired ........................................ (1,472) (242,584)
----------- -----------
Outstanding at October 31, 1999 ................ -- --
----------- -----------
C. Related Parties
Under the Investment Management Agreement (the "Agreement") with Scudder Kemper
Investments, Inc. ("Scudder Kemper" or the "Adviser"), the Adviser directs the
investments of the Fund in accordance with its investment objectives, policies,
and restrictions. The Adviser determines the securities, instruments, and other
contracts relating to investments to be purchased, sold or entered into by the
Fund. In addition to portfolio management services, the Adviser provides certain
administrative services in accordance with the Agreement. The management fee
payable under the Agreement is equal to an annual rate of 1% of the Fund's
average net assets, computed and accrued daily and payable monthly. For the year
ended October 31, 1999, the fee pursuant to this Agreement aggregated
$1,150,027.
SCUDDER GOLD FUND 25
<PAGE>
- --------------------------------------------------------------------------------
Scudder Service Corporation ("SSC"), a subsidiary of the Adviser, is the
transfer, dividend paying and shareholder service agent. For the year ended
October 31, 1999, the amount charged to the Fund by SSC aggregated $401,999, of
which $63,725 is unpaid at October 31, 1999.
Scudder Trust Company ("STC"), a subsidiary of the Adviser, provides
recordkeeping and other services in connection with certain retirement and
employee benefit plans invested in the Fund. For the year ended October 31,
1999, the amount charged to the Fund by STC aggregated $22,451, of which $5,577
is unpaid at October 31, 1999.
Scudder Fund Accounting Corporation ("SFAC"), a subsidiary of the Adviser, is
responsible for determining the daily net asset value per share and maintaining
the portfolio and general accounting records of the Fund. For the year ended
October 31, 1999, the amount charged to the Fund by SFAC aggregated $49,857, of
which $6,748 is unpaid at October 31, 1999.
The Fund pays each Director not affiliated with the Adviser an annual retainer
plus specified amounts for attended board and committee meetings. For the year
ended October 31, 1999, Directors' fees and expenses aggregated $50,054.
D. Line of Credit
The Fund and several Scudder Funds (the "Participants") share in a $850 million
revolving credit facility for temporary or emergency purposes, including the
meeting of redemption requests that otherwise might require the untimely
disposition of securities. The Participants are charged an annual commitment fee
which is allocated among each of the Participants. Interest is calculated based
on the market rates at the time of the borrowing. The Fund may borrow up to a
maximum of 33 1/3 percent of its consolidated net assets under the agreement.
E. Transactions in Securities of Affiliated Issuers
An affiliated issuer is a company in which the Fund has ownership of at least 5%
of the voting securities. A summary of the Fund's transactions with
26 SCUDDER GOLD FUND
<PAGE>
- --------------------------------------------------------------------------------
companies which are or were affiliates during the year ended October 31, 1999 is
as follows:
<TABLE>
<CAPTION>
Purchases Sales Dividend Market
Affiliate Cost ($) Proceeds ($) Income ($) Value ($)
- -------------------------------- ------------ ------------ ------------ -----------
<S> <C> <C> <C> <C>
International Roraima Gold Corp. -- 13,830 -- --
Piedmont Mining Co. -- -- -- 202,500
X-CAL Resources -- 49,261 -- 487,720
------------ ------------ ------------ -----------
-- 63,091 -- 690,220
------------ ------------ ------------ -----------
</TABLE>
SCUDDER GOLD FUND 27
<PAGE>
Report of Independent Accountants
- --------------------------------------------------------------------------------
To the Board of Directors of Scudder Mutual Funds, Inc. and the
Shareholders of Scudder Gold Fund:
In our opinion, the accompanying consolidated statement of assets and
liabilities, including the investment portfolio, and the related
consolidated statements of operations and of changes in net assets and the
consolidated financial highlights present fairly, in all material
respects, the financial position of Scudder Gold Fund and its subsidiary
(the "Fund") at October 31, 1999, the results of their operations, the
changes in their net assets, and the financial highlights for the periods
indicated therein, in conformity with generally accepted accounting
principles. These consolidated financial statements and financial
highlights (hereafter referred to as "financial statements") are the
responsibility of the Fund's management; our responsibility is to express
an opinion on these financial statements based on our audits. We conducted
our audits of these financial statements in accordance with generally
accepted auditing standards which require that we plan and perform the
audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the
financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits, which
included confirmation of securities at October 31, 1999 by correspondence
with the custodian and brokers, provide a reasonable basis for the opinion
expressed above.
Boston, Massachusetts PricewaterhouseCoopers LLP
December 16, 1999
28 SCUDDER GOLD FUND
<PAGE>
Tax Information
- --------------------------------------------------------------------------------
October 31, 1999
Please consult a tax adviser if you have questions about federal or state
income tax laws, or on how to prepare your tax returns. If you have
specific questions about your account, please call 1-800-SCUDDER.
SCUDDER GOLD FUND 29
<PAGE>
Officers and Directors
- --------------------------------------------------------------------------------
Lynn S. Birdsong*
o President
Sheryle J. Bolton
o Director; Chief Executive Officer, Scientific Learning Corporation
William T. Burgin
o Director; General Partner, Bessemer Venture Partners
Keith R. Fox
o Director; Private Equity Investor
William H. Luers
o Director; Chairman and President, U.N. Association of America
Kathryn L. Quirk*
o Director, Vice President and Assistant Secretary
Joan E. Spero
o Director; President, Doris Duke Charitable Foundation
Thomas J. Devine
o Honorary Director; Consultant
Robert G. Stone, Jr.
o Honorary Director; Chairman Emeritus and Director, Kirby Corporation
Joann M. Barry*
o Vice President
Ann M. McCreary*
o Vice President
John Millette*
o Vice President and Secretary
John R. Hebble*
o Treasurer
Caroline Pearson*
o Assistant Secretary
*Scudder Kemper Investments, Inc.
30 SCUDDER GOLD FUND
<PAGE>
Investment Products and Services
- --------------------------------------------------------------------------------
1-800-SCUDDER www.scudder.com
- --------------------------------------------------------------------------------
The Scudder Family of Funds[
- --------------------------------------------------------------------------------
Money Market
Scudder U.S. Treasury Money Fund
Scudder Cash Investment Trust
Scudder Money Market Series --
Prime Reserve Shares*
Premium Shares*
Managed Shares*
Scudder Government Money Market
Series -- Managed Shares*
Tax Free Money Market+
Scudder Tax Free Money Fund
Scudder Tax Free Money Market
Series -- Managed Shares*
Scudder California Tax Free Money Fund**
Scudder New York Tax Free Money Fund**
Tax Free+
Scudder Limited Term Tax Free Fund
Scudder Medium Term Tax Free Fund
Scudder Managed Municipal Bonds
Scudder High Yield Tax Free Fund
Scudder California Tax Free Fund**
Scudder Massachusetts Limited Term
Tax Free Fund**
Scudder Massachusetts Tax Free Fund**
Scudder New York Tax Free Fund**
Scudder Ohio Tax Free Fund**
U.S. Income
Scudder Short Term Bond Fund
Scudder GNMA Fund
Scudder Income Fund
Scudder Corporate Bond Fund
Scudder High Yield Bond Fund
Global Income
Scudder Global Bond Fund
Scudder International Bond Fund
Scudder Emerging Markets Income Fund
Asset Allocation
Scudder Pathway Conservative Portfolio
Scudder Pathway Balanced Portfolio
Scudder Pathway Growth Portfolio
U.S. Growth and Income
Scudder Balanced Fund
Scudder Dividend & Growth Fund
Scudder Growth and Income Fund
Scudder Select 500 Fund
Scudder S&P 500 Index Fund
Scudder Real Estate Investment Fund
U.S. Growth
Value
Scudder Large Company Value Fund
Scudder Value Fund***
Scudder Small Company Value Fund
Scudder Micro Cap Fund
Growth
Scudder Classic Growth Fund***
Scudder Large Company Growth Fund
Scudder Select 1000 Growth Fund
Scudder Development Fund
Scudder 21st Century Growth Fund
Global Equity
Worldwide
Scudder Global Fund
Scudder International Value Fund
Scudder International Growth and
Income Fund
Scudder International Fund++
Scudder International Growth Fund
Scudder Global Discovery Fund***
Scudder Emerging Markets Growth Fund
Scudder Gold Fund
Regional
Scudder Greater Europe Growth Fund
Scudder Pacific Opportunities Fund
Scudder Latin America Fund
The Japan Fund, Inc.
Industry Sector Funds
Choice Series
Scudder Financial Services Fund
Scudder Heath Care Fund
Scudder Technology Fund
Preferred Series
Scudder Tax Managed Growth Fund
Scudder Tax Managed Small Company Fund
SCUDDER GOLD FUND 31
<PAGE>
- --------------------------------------------------------------------------------
1-800-SCUDDER www.scudder.com
- --------------------------------------------------------------------------------
Retirement Programs and Education Accounts
- --------------------------------------------------------------------------------
Retirement Programs
Traditional IRA
Roth IRA
SEP-IRA
Keogh Plan
401(k), 403(b) Plans
Variable Annuities
Scudder Horizon Plan**[[
Scudder Horizon Advantage**[[[
Education Accounts
Education IRA
UGMA/UTMA
- --------------------------------------------------------------------------------
Closed-End Funds#
- --------------------------------------------------------------------------------
The Argentina Fund, Inc.
The Brazil Fund, Inc.
The Korea Fund, Inc.
Montgomery Street Income Securities, Inc.
Scudder Global High Income Fund, Inc.
Scudder New Asia Fund, Inc.
For complete information on any of the above Scudder funds, including management
fees and expenses, call or write for a free prospectus. Read it carefully before
you invest or send money.
[ Funds within categories are listed in order from expected least risk to
most risk. Certain Scudder funds or classes thereof may not be available
for purchase or exchange.
+ A portion of the income from the tax-free funds may be subject to federal,
state, and local taxes.
* A class of shares of the fund.
** Not available in all states.
*** Only the Scudder Shares of the fund are part of the Scudder Family of
Funds.
++ Only the International Shares of the fund are part of the Scudder Family
of Funds.
[[ A no-load variable annuity contract provided by Charter National Life
Insurance Company and its affiliate, offered by Scudder's insurance
agencies, 1-800-225-2470.
[[[ A no-load variable annuity contract issued by Glenbrook Life and Annuity
Company and underwritten by Allstate Financial Services, Inc., sold by
Scudder's insurance agencies, 1-800-225-2470.
# These funds, advised by Scudder Kemper Investments, Inc., are traded on
the New York Stock Exchange and, in some cases, on various other stock
exchanges.
32 SCUDDER GOLD FUND
<PAGE>
Scudder Solutions
- --------------------------------------------------------------------------------
1-800-SCUDDER www.scudder.com
Convenient ways to invest, quickly and reliably
Automatic Investment Plan
A convenient investment program in which money is electronically debited
from your bank account monthly to regularly purchase fund shares and
"dollar cost average" -- buy more shares when the fund's price is lower
and fewer when it's higher, which can reduce your average purchase price
over time.*
Automatic Dividend Transfer
The most timely, reliable, and convenient way to purchase shares -- use
distributions from one Scudder fund to purchase shares in another,
automatically (accounts with identical registrations or the same social
security or tax identification number).
QuickBuy
Lets you purchase Scudder fund shares electronically, avoiding potential
mailing delays; money for each of your transactions is electronically
debited from a previously designated bank account.
Payroll Deduction and Direct Deposit
Have all or part of your paycheck -- even government checks -- invested in
up to four Scudder funds at one time.
* Dollar cost averaging involves continuous investment in securities
regardless of price fluctuations and does not assure a profit or
protect against loss in declining markets. Investors should consider
their ability to continue such a plan through periods of low price
levels.
Around-the-clock electronic account service and information, including some
transactions
Scudder Automated Information Line: SAIL(TM) -- 1-800-343-2890
Personalized account information, the ability to exchange or redeem
shares, and information on other Scudder funds and services via touchtone
telephone.
Scudder's Web Site -- www.scudder.com
Personal Investment Organizer: Offering account information and
transactions, interactive worksheets, prospectuses and applications for
all Scudder funds, plus your current asset allocation, whenever your need
them. Scudder's site also provides news about Scudder funds, retirement
planning information, and more.
SCUDDER GOLD FUND 33
<PAGE>
- --------------------------------------------------------------------------------
1-800-SCUDDER www.scudder.com
Retirees and those who depend on investment proceeds for living expenses can
enjoy these convenient, timely, and reliable automated withdrawal programs
Automatic Withdrawal Plan
You designate the bank account, determine the schedule (as frequently as
once a month) and amount of the redemptions, and Scudder does the rest.
Distributions Direct
Automatically deposits your fund distributions into the bank account you
designate within three business days after each distribution is paid.
QuickSell
Provides speedy access to your money by electronically crediting your
redemption proceeds to the bank account you previously designated.
For more information about these services
Call a Scudder representative at
1-800-SCUDDER
Or visit our Web site at
www.scudder.com
Please address all written correspondence to
The Scudder Funds
PO Box 2291
Boston, Massachusetts
02107-2291
34 SCUDDER GOLD FUND
<PAGE>
Notes
- --------------------------------------------------------------------------------
<PAGE>
SCUDDER
INVESTMENTS(SM)
[LOGO]
PO Box 2291
Boston, MA 02107-2291
1-800-SCUDDER
www.scudder.com
A member of the [LOGO] Zurich Financial Services Group
About the Fund's Adviser
Scudder Kemper Investments, Inc. is one of the largest and most
experienced investment management organizations worldwide, managing more
than $290 billion in assets globally for mutual fund investors, retirement
and pension plans, institutional and corporate clients, insurance
companies, and private family and individual accounts.
Scudder Kemper Investments has a rich heritage of innovation, integrity,
and client-focused service. In 1997, Scudder, Stevens & Clark, Inc.,
founded over 80 years ago as one of the nation's first investment counsel
organizations, joined the Zurich Financial Services Group. As a result,
Zurich's subsidiary, Zurich Kemper Investments, Inc., with 50 years of
mutual fund and investment management experience, was combined with
Scudder. Headquartered in New York, Scudder Kemper Investments offers a
full range of investment counsel and asset management capabilities, based
on a combination of proprietary research and disciplined, long-term
investment strategies. With its global investment resources and
perspective, the firm seeks opportunities in markets throughout the world
to meet the needs of investors.
Scudder Kemper Investments, Inc., the global asset management firm, is a
member of the Zurich Financial Services Group. The Zurich Financial
Services Group is an internationally recognized leader in financial
services, including property/casualty and life insurance, reinsurance, and
asset management.
This information must be preceded or accompanied by a current prospectus.
Portfolio changes should not be considered recommendations for action by
individual investors.
