[graphic omitted]
Warburg Pincus Advisor Funds OCTOBER 31, 2000
International Equity Fund
Emerging Markets Fund
Global Post-Venture Capital Fund
--------------------------------------------------------------------------------
A
ANNUAL REPORT
--------------------------------------------------------------------------------
More complete information about the Funds, including charges and expenses, is
provided in the PROSPECTUS, which must precede or accompany this document and
which should be read carefully before investing. You may obtain additional
copies by calling 800-222-8977 or by writing to Warburg Pincus Advisor Funds,
P.O. Box 9030, Boston, MA 02205-9030.
[Warburg Pincus and Credt Suisse logos omitted]
<PAGE>
FROM TIME TO TIME, THE FUNDS' INVESTMENT ADVISER AND CO-ADMINISTRATORS MAY WAIVE
SOME FEES AND/OR REIMBURSE SOME EXPENSES, WITHOUT WHICH PERFORMANCE WOULD BE
LOWER. WAIVERS AND/OR REIMBURSEMENTS ARE SUBJECT TO CHANGE.
RETURNS ARE HISTORICAL AND INCLUDE CHANGE IN SHARE PRICE AND REINVESTMENT OF
DIVIDENDS AND CAPITAL GAINS. PAST PERFORMANCE CANNOT GUARANTEE FUTURE RESULTS.
RETURNS AND SHARE PRICE WILL FLUCTUATE, AND REDEMPTION VALUE MAY BE MORE OR LESS
THAN ORIGINAL COST.
INTERNATIONAL INVESTING ENTAILS SPECIAL RISK CONSIDERATIONS, INCLUDING CURRENCY
FLUCTUATIONS, LOWER LIQUIDITY, ECONOMIC AND POLITICAL RISKS, AND DIFFERENCES IN
ACCOUNTING METHODS.
THE VIEWS OF THE FUNDS' MANAGEMENT ARE AS OF THE DATE OF THE LETTERS AND
PORTFOLIO HOLDINGS DESCRIBED IN THIS DOCUMENT ARE AS OF OCTOBER 31, 2000; THESE
VIEWS AND PORTFOLIO HOLDINGS MAY HAVE CHANGED SUBSEQUENT TO THESE DATES. NOTHING
IN THIS DOCUMENT IS A RECOMMENDATION TO PURCHASE OR SELL SECURITIES.
FUND SHARES ARE NOT DEPOSITS OR OTHER OBLIGATIONS OF CREDIT SUISSE ASSET
MANAGEMENT ("CSAM") OR ANY AFFILIATE, ARE NOT FDIC INSURED AND ARE NOT
GUARANTEED BY CSAM OR ANY AFFILIATE. FUND INVESTMENTS ARE SUBJECT TO INVESTMENT
RISKS, INCLUDING LOSS OF YOUR INVESTMENT.
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
ANNUAL INVESTMENT ADVISER'S REPORT -- OCTOBER 31, 2000
--------------------------------------------------------------------------------
December 6, 2000
Dear Shareholder:
For the 12 months ended October 31, 2000, the Advisor Class shares of Warburg
Pincus International Equity Fund had a loss of 8.15%, vs. a loss of 1.96% for
the Morgan Stanley All Country World Excluding the U.S. Index.
The period was a volatile one for equities around the world. Most markets
initially rallied, but then became volatile as inflation and interest-rate
worries mounted. Because the global economy was growing at a healthy clip, the
world's monetary authorities were increasingly inclined to raise interest rates
to contain inflation. The upward trend in interest rates, combined with fears
that the global economy would in fact slow too much, weighed on stocks over the
latter part of the period. Technology and telecommunications stocks, which
entered the period with generally lofty valuations, were hit the hardest.
Performance was largely divided along regional lines. Winners included Canada
and most European markets (in local terms, at least; performance was
significantly lower for dollar-based investors, as the euro steadily weakened
vs. the dollar during the period). Asian/Pacific markets ended up in negative
territory, hampered by growth uncertainties, especially within the technology
segment.
The Fund's results were hampered by the difficult environment for foreign
stock markets and currencies that prevailed over much of the period. Investments
that weighed on the Fund's return included its Asian electronic-hardware
holdings and its telecommunications investments in general. On the positive
side, the Fund was helped by good stock selection in Europe, with its French,
German and U.K. holdings performing relatively well. The Fund was also aided by
its large overweight position in Canada, a solid performer for the period; and
by its large overweight position in energy and energy-services companies.
Clearly, though, relatively good performances from the Fund's Canadian and
European holdings failed to compensate for weakness in its Asian stocks.
We made a few noteworthy changes to the Fund during the period in terms of
regional allocation. We significantly lowered our weighting in Japan, paring
exposure to certain companies here based on specific industry considerations and
valuations (market forces also contributed to our reduced position in Japan). We
materially increased our exposure to Canada, and lowered our overall weighting
in emerging markets.
1
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
ANNUAL INVESTMENT ADVISER'S REPORT -- OCTOBER 31, 2000 (CONT'D)
--------------------------------------------------------------------------------
The bulk of the Fund's assets remained invested in Europe, reflecting our
favorable outlook on the region's longer-term prospects. Our optimism is based
squarely on reforms, both ongoing and those soon to be implemented. These
reforms are aimed at encouraging the growth of a strong equity culture in
Europe, one that will allow the region to compete effectively worldwide as well
as come to grips with its pension burden. Such efforts have led to strong equity
cultures and equity returns in countries such as the U.S., the U.K. and Canada
over the past decade.
One key element of Europe's ongoing embrace of equity investing and the
enhancement of shareholder value is tax reform. A leading light is Germany. The
government will phase in a two-part tax reform package over the next two years;
the first component, corporate and personal tax cuts, will take effect in 2001.
In addition, Germany will eliminate a punitive capital-gains tax in 2002.
This is certain to spark a wave of divestitures and redeployment of corporate
capital as companies unload unwanted holdings and restructure their core
businesses. It should also launch a rash of new publicly offered companies. The
trend, in our view, will likely spread to France and Italy, among other markets,
providing a number of interesting investment opportunities over the next few
years. Also on the horizon is pension reform, and, perhaps further down the
road, labor reform.
Despite our lowered Japan position, we see good potential for a more
favorable investing environment here over the next year based on several
factors. The economy continues to recover, with a notable uptrend in industrial
production and continued job creation. Another encouraging development is the
growth of information-technology ("IT") expenditures in Japan. We believe this
will be the true engine pulling the economy forward, as opposed to government
spending programs, which can aid consumption but have little overall long-term
positive impact. Based on our extensive contact with Japanese managements, we
believe the commitment to IT capital will remain substantial, helping to boost
productivity as it has in the U.S.
Our holdings in Japan continued to include technology companies such as
capital-equipment suppliers to the new economy, or "new capex" stocks. We
believe these companies have good long-term prospects due to accelerating demand
for telecommunications services across Asia and elsewhere. Other areas of
concentration within our Japan portfolio included financial-services stocks,
which stand to benefit from Japan's expanding equity culture.
Our non-Japan Asian exposure was mostly via the economies of Taiwan and South
Korea at the end of the period. We continued to avoid South East
2
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
ANNUAL INVESTMENT ADVISER'S REPORT -- OCTOBER 31, 2000 (CONT'D)
--------------------------------------------------------------------------------
Asian markets, with the notable exception of Singapore, where stocks stand to
benefit from ongoing financial reforms and an improving economy.
Elsewhere, we ended the period with an approximately 15% weighting in Canada,
up from about 5% at the start of the 12 months. Our holdings here remained a mix
of rapid-growth technology companies and energy names. We largely avoided Latin
America throughout the period, as stocks here in our judgment remained less
attractive from a risk/reward perspective compared to emerging-market stocks in
Asia.
Looking ahead, we see grounds for optimism as 2000 fades into memory. We
entered the year concerned that higher-than-expected growth and inflationary
pressures would result in tighter monetary conditions, and we have tried our
best to hold value in the Fund within exactly such an environment. While this
view was correct and we positioned ourselves for a "soft landing" scenario, the
shock of the correction in the NASDAQ left all but the most defensive companies
at lower prices. We believe that 2001 should shape up to be a far better year
for equity markets around the world. Growth in global economies is
moderating--with no evidence of severe contractions on the horizon--which should
alloW for a more-supportive interest rate backdrop and help return some degree
of stability to stock markets. Given the prospects for a more rational, less
fear-driven, market, we expect to see ample opportunities to add value via
individual company selection, and we will continue to focus on attempting to
identify stocks and markets with the brightest long-term prospects.
Harold E. Sharon P. Nicholas Edwards Vincent J. McBride
Co-Portfolio Manager Co-Portfolio Manager Co-Portfolio Manager
INTERNATIONAL INVESTING ENTAILS SPECIAL RISK CONSIDERATIONS, INCLUDING
CURRENCY FLUCTUATIONS, LOWER LIQUIDITY, ECONOMIC AND POLITICAL RISKS, AND
DIFFERENCES IN ACCOUNTING METHODS. THESE ARE DETAILED IN THE FUND'S PROSPECTUS,
WHICH SHOULD BE READ CAREFULLY BEFORE INVESTING.
3
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
ANNUAL INVESTMENT ADVISER'S REPORT -- OCTOBER 31, 2000 (CONT'D)
--------------------------------------------------------------------------------
GROWTH OF $10,000 INVESTED IN ADVISOR CLASS SHARES OF WARBURG PINCUS
INTERNATIONAL EQUITY FUND SINCE INCEPTION AS OF OCTOBER 31, 2000
The graph below illustrates a hypothetical investment of $10,000 in Advisor
Class shares of Warburg Pincus International Equity Fund (the "Fund") from April
5, 1991 (inception) to October 31, 2000, compared to the Morgan Stanley All
Country World Excluding the U.S. Index ("MSCI")* for the same time period.
[line graph omitted]
plot points as follows:
Fund MSCI
10000 10000
4/30/91 9847.79 10127.9
5/31/91 10000 10260.8
6/30/91 9519.33 9580.69
7/31/91 10069.8 10029.7
8/31/91 9993.39 9835.87
9/30/91 10337.5 10327.9
10/31/91 10444.5 10478.1
11/30/91 10062.2 10018.5
12/31/91 10409.2 10520.3
1/31/92 10510.4 10429.6
2/29/92 10417 10098.7
3/31/92 10222.5 9507.69
4/30/92 10401.5 9534.12
5/31/92 10821.6 10089.7
6/30/92 10346.6 9613.44
7/31/92 9909.67 9392.33
8/31/92 9933.07 9862.04
9/30/92 9753.61 9641.72
10/31/92 9519.52 9248.92
11/30/92 9738 9314.95
12/31/92 9906.62 9378.48
1/31/93 10143.1 9376.14
2/28/93 10363.7 9686.49
3/31/93 11025.8 10486.4
4/30/93 11679.9 11386.2
5/31/93 11884.8 11624
6/30/93 11606.2 11478
7/31/93 12032 11842.1
8/31/93 12788.9 12447.2
9/30/93 12733.7 12203
10/31/93 13332.9 12638.9
11/30/93 13104.3 11735.1
12/31/93 14917.1 12714.9
1/31/94 16323.5 13756.8
2/28/94 15936.3 13629.8
3/31/94 14648.5 13001
4/30/94 14956.6 13454.2
5/31/94 15446.5 13469
6/30/94 15225.2 13561.4
7/31/94 15730.9 13811.6
8/31/94 16410.4 14284.6
9/30/94 16031.2 13985.1
10/31/94 16102.3 14316.1
11/30/94 15407 13635.1
12/31/94 14878.8 13618.7
01/31/95 13592.8 12961.8
02/28/95 13348.6 12890.1
03/31/95 14219.5 13608.3
04/30/95 14642.7 14092.1
05/31/95 14626.4 14016.3
06/30/95 14479.4 13821.6
07/31/95 15392.1 14574.6
08/31/95 15620.2 14056.3
09/30/95 15962.4 14316.3
10/31/95 15612.1 13935.8
11/30/95 15848.4 14227.2
12/31/95 16345 14781.2
01/31/96 16805.3 14946.3
02/29/96 16830.4 14948.9
03/31/96 16989.4 15239.5
04/30/96 18002.1 15781.1
05/31/96 17608.8 15517.9
06/30/96 17818 15609.6
07/31/96 16930.9 15073.8
08/31/96 17081.5 15160.5
09/30/96 17349.3 15532.9
10/31/96 17156.8 15372.9
11/30/96 17893.3 15956.6
12/31/96 17989.7 15764.3
01/31/97 17981 15487
02/28/97 18172.2 15777.7
03/31/97 18024.4 15751.5
04/30/97 18372 15895.2
05/31/97 19623.5 16855.4
06/30/97 20457.8 17795.1
07/31/97 21066.1 18160.1
08/31/97 19293.2 16771.4
09/30/97 20153.6 17619.3
10/31/97 17850.6 16070.6
11/30/97 17293.7 15865.2
12/31/97 17117.3 16035.3
01/31/98 17168.6 16510.9
02/28/98 18446 17634.6
03/31/98 19510.3 18230.8
04/30/98 20017.6 18343.1
05/31/98 19967.5 17987.5
06/30/98 19258.7 17907.4
07/31/98 19553.3 18080.1
08/31/98 16573.4 15522.6
09/30/98 15812.7 15204
10/31/98 16695 16795.9
11/30/98 17576.5 17695.2
12/31/98 17840.2 18293.8
01/31/99 17961.5 18275.7
02/28/99 17352.6 17887.6
03/31/99 18031.1 18769.4
04/30/99 18335.8 19728.5
05/31/99 17686.7 18833.8
06/30/99 19055.7 19746.3
07/31/99 20099.9 20166.9
08/31/99 20475.8 20281.9
09/30/99 20850.5 20389.4
10/31/99 21834.6 21160.1
11/30/99 24085.8 21998
12/31/99 27855.2 24110.9
01/31/00 25986.1 22886.3
02/29/00 27945.5 23498.1
03/31/00 27143.5 24374.1
04/30/00 24594.7 22991.4
05/31/00 23751.1 22425.3
06/30/00 24442.2 23368.3
07/31/00 22868.2 22449.2
08/31/00 23883.5 22720
09/30/00 22066 21444
10/31/00 20055.8 20745.8
--------------------------------------------------------------------------------
Average Annual
Total Returns
for periods ended
10/31/00
(Advisor Class shares)
--------------------------------------------------------------------------------
1 year
-8.15%
--------------------------------------------------------------------------------
3 year
3.95%
--------------------------------------------------------------------------------
5 year
5.13%
--------------------------------------------------------------------------------
Since Inception
(4/05/91)
9.20%
--------------------------------------------------------------------------------
FUND
------
1 Year Total Return (9/30/99 to 9/30/00) 5.83%
3 Year Average Annual Total Return (9/30/97 to 9/30/00) 3.06%
5 Year Average Annual Total Return (9/30/95 to 9/30/00) 6.69%
Average Annual Total Return Since Inception
(4/05/91 to 9/30/00) 10.19%
--------------------------------------------------------------------------------
* The Morgan Stanley All Country World Excluding the U.S. Index is a
market-capitalization weighted index of companies listed on stock exchanges
outside of the United States.
4
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
ANNUAL INVESTMENT ADVISER'S REPORT -- OCTOBER 31, 2000
--------------------------------------------------------------------------------
December 6, 2000
Dear Shareholder:
For the 12 months ended October 31, 2000, the Advisor Class shares of Warburg
Pincus Emerging Markets Fund had a loss of 2.77%, vs. a loss of 8.80% for the
Morgan Stanley Emerging Markets Free Index.
The period was a volatile and ultimately negative one for emerging stock
markets. The group initially rallied, buoyed by optimism over global economic
growth and a dissipation of "Y2K" computer bug worries (emerging markets were
believed to be quite vulnerable to the potential glitch). However, turmoil hit
these stocks in April and May, reflecting concerns over interest rates within
developed markets and a sharp downturn in the NASDAQ, the technology-heavy U.S.
stock index. These factors curbed investors' appetite for risk, to put it
mildly. Emerging stock markets languished over the remainder of the period, with
rising energy costs and a weakening euro adding to the uncertainty.
Against this backdrop, the Fund had a loss, hindered by the difficult
environment for emerging stock markets and by weakness in certain areas, most
specifically the telecommunications and electronics sectors. However, the Fund
fared well vs. its benchmark, aided by good showings from specific holdings, for
example, certain consumer-oriented and energy names. In terms of sector
attribution, factors that supported the Fund included well-timed overweightings
in China, Mexico and Turkey.
We made few major changes to the Fund during the period with respect to
regional emphasis. Our primary focus was on Asia, with a continued emphasis on
North Asian economies, most specifically South Korea, Taiwan and China. Our
favorable view on these markets is based on their potential to benefit from
rising export demand, in particular for software and semiconductor products. In
addition, we believe that valuations on a number of stocks here are compelling,
both in absolute terms and compared to emerging-market technology stocks
broadly. We generally continued to avoid Southeast Asia, reflecting the more
attractive stocks we saw elsewhere from a risk/reward perspective.
We ended the period with an underweighting in Eastern/Central Europe, based
on our general concerns over the region's vulnerability to a weak euro and high
oil prices. However, we maintained an overweighting in Turkey, reflecting our
optimism over the country's ongoing International Monetary Fund-sanctioned
financial reforms (though we scaled back this position late in the period based
on valuation considerations). We also established a
5
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
ANNUAL INVESTMENT ADVISER'S REPORT -- OCTOBER 31, 2000 (CONT'D)
--------------------------------------------------------------------------------
modest position in Russia, where we believe the macroeconomic and political
environment is improving, some near-term financial-market uncertainties
notwithstanding. One weighting we pared during the period was Hungary, where we
saw declining potential for positive market catalysts.
Our Latin America exposure remained concentrated on Mexico and Brazil, the
region's dominant economies. We raised our Mexican weighting in late June, in
the belief that its market had fully discounted any unfavorable July election
results. We then pared our weighting back to a roughly neutral position after
the market rallied on the victory of the reform-minded opposition candidate. We
ended the period with a modest overweighting in Brazil, which stands to benefit
from an improving inflation and interest-rate backdrop. Elsewhere in the region,
we established a small position in Chile.
With regard to sector allocation, areas of emphasis for the Fund continued to
include information-technology ("IT") companies, a number of which in our view
have good longer-term prospects. Our IT holdings remained concentrated in Asia
and Israel. We ended the period with an overweighting in telecommunications
services, where our holdings included Asian cellular stocks and Latin American
fixed-line names. Within the financial segment, our focus was on companies that
stand to benefit from financial and economic reforms, particularly within Europe
and Latin America.
Looking ahead, emerging markets could remain weak over the next few months
and perhaps beyond. Clearly, investors are concerned that a slowing global
economy will hamper the group's earnings prospects, especially within certain
areas. In addition, ongoing volatility in the technology area could continue to
suppress investors' risk tolerance. However, we see grounds for optimism
regarding these markets over the longer term. The group's valuations currently
range from reasonable to very compelling. Indeed, we believe that a large number
of these stocks have been oversold, priced to a "worst case" scenario in many
cases. Barring another surge in oil prices or a recession in developed
economies, this stands to draw increased investor attention to the group. For
our part, we will continue to focus on markets where we see attractive
valuations, potential for strong domestic liquidity and some degree of
insulation from global concerns.
Richard Watt
Portfolio Manager
INTERNATIONAL INVESTING ENTAILS SPECIAL RISK CONSIDERATIONS, INCLUDING
CURRENCY FLUCTUATIONS, LOWER LIQUIDITY, ECONOMIC AND POLITICAL RISKS, AND
DIFFERENCES IN ACCOUNTING METHODS; THESE RISKS ARE GENERALLY HEIGHTENED FOR
EMERGING-MARKET INVESTMENTS. THESE ARE DETAILED IN THE FUND'S PROSPECTUS, WHICH
SHOULD BE READ CAREFULLY BEFORE INVESTING.
6
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
ANNUAL INVESTMENT ADVISER'S REPORT -- OCTOBER 31, 2000 (CONT'D)
--------------------------------------------------------------------------------
GROWTH OF $10,000 INVESTED IN ADVISOR CLASS SHARES OF WARBURG PINCUS
EMERGING MARKETS FUND SINCE INCEPTION AS OF OCTOBER 31, 2000
The graph below illustrates a hypothetical investment of $10,000 in Advisor
Class shares of Warburg Pincus Emerging Markets Fund (the "Fund") from December
30, 1994 (inception) to October 31, 2000, compared to the Morgan Stanley
Emerging Markets Free Index ("MS Emerging Markets Free Index")* for the same
time period.
[line graph omitted]
plot points as follows:
Fund MSCI
10000 10000
01/31/95 9860 8936.2
02/28/95 9890 8707.08
03/31/95 10410 8762.45
04/30/95 10570 9155.54
05/31/95 11230 9642.52
06/30/95 10928 9671.06
07/31/95 11770.2 9888.08
08/31/95 11639.8 9655.31
09/30/95 11840.3 9609.64
10/31/95 11329 9241.98
11/30/95 11248.8 9077.2
12/31/95 11702.7 9479.77
01/31/96 12422.1 10153.5
02/29/96 12553.8 9992.26
03/31/96 12867.9 10070
04/30/96 13931.8 10472.6
05/31/96 13577.2 10426.1
06/30/96 13415.1 10491.2
07/31/96 12452.5 9774.3
08/31/96 12523.4 10024.4
09/30/96 12746.3 10111.2
10/31/96 12371.4 9841.77
11/30/96 12746.3 10007.1
12/31/96 12842.5 10052.1
01/31/97 13653.4 10737.7
02/28/97 13977.7 11197.7
03/31/97 13663.5 10903.5
04/30/97 13987.9 10923
05/31/97 14727.8 11235.5
06/30/97 15224.5 11836.9
07/31/97 15366.4 12013.5
08/31/97 13572.3 10484.9
09/30/97 13764.9 10775.5
10/31/97 11018 9007.49
11/30/97 10409.8 8678.71
12/31/97 10251.6 8887.87
01/31/98 9463.22 8190.88
02/28/98 10795.6 9045.77
03/31/98 11073.1 9438.17
04/30/98 10944.6 9335.39
05/31/98 9410.2 8056.16
06/30/98 8813.59 7211.07
07/31/98 8706.95 7439.66
08/31/98 6127.95 5288.85
09/30/98 6330.17 5624.38
10/31/98 6863.17 6216.68
11/30/98 7129.47 6733.72
12/31/98 7054.61 6636.09
01/31/99 6617.93 6529.05
02/28/99 6490.2 6592.57
03/31/99 7150.9 7461.28
04/30/99 8099.11 8384.24
05/31/99 8365.57 8335.61
06/30/99 9420.47 9281.7
07/31/99 9378.08 9029.24
08/31/99 9453.1 9111.4
09/30/99 9218.67 8803.44
10/31/99 9623.37 8990.95
11/30/99 11179.5 9797.44
12/31/99 13034.1 11043.5
01/31/00 12949.4 11109.3
02/29/00 13876.6 11256
03/31/00 13418.7 11311
04/30/00 11766.8 10238.8
05/31/00 11468 9815.54
06/30/00 11852.1 10161.3
07/31/00 11286.8 9638.74
08/31/00 11308.2 9686.17
09/30/00 10039.4 8840.37
10/31/00 9357.77 8199.44
--------------------------------------------------------------------------------
Average Annual
Total Returns
for periods ended
10/31/00
(Advisor Class shares)
--------------------------------------------------------------------------------
1 year
-2.77%
--------------------------------------------------------------------------------
3 year
-5.30%
--------------------------------------------------------------------------------
5 year
-3.75%
--------------------------------------------------------------------------------
Since Inception
(12/30/94)
-1.13%
--------------------------------------------------------------------------------
FUND
------
1 Year Total Return (9/30/99 to 9/30/00) 8.90%
3 Year Average Annual Total Return (9/30/97 to 9/30/00) -9.99%
5 Year Average Annual Total Return (9/30/95 to 9/30/00) -3.25%
Average Annual Total Return Since Inception
(12/30/94 to 9/30/00) 0.07%
--------------------
* The Morgan Stanley Emerging Markets Free Index is a market-capitalization
weighted index of emerging-market countries determined by Morgan Stanley. The
index includes only those countries open to non-local investors.
7
<PAGE>
WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND
ANNUAL INVESTMENT ADVISER'S REPORT -- OCTOBER 31, 2000
--------------------------------------------------------------------------------
December 6, 2000
Dear Shareholder:
For the 12 months ended October 31, 2000, the Advisor Class shares of Warburg
Pincus Global Post-Venture Capital Fund had a gain of 59.94%, vs. gains of
11.92% for the Lipper Global Funds Index, 0.09% for the Morgan Stanley World
Index and 16.16% for the Russell 2000 Growth Index.
The period was a volatile one for global stock markets. Most markets started
on a strong note, only to encounter turbulence due to mounting inflation and
interest-rate worries. Because most economies were growing at a healthy clip,
monetary authorities were increasingly inclined to raise interest rates. Over
the latter part of the period, investors became concerned that the global
economy would in fact slow, perhaps dramatically, as a result of the rate hikes.
In terms of returns for the 12 months, performance was largely divided along
regional lines. European and North American markets had sizable gains, while
Asian/Pacific markets had significant losses.
The Fund had a large gain for the period, and handily outpaced its
benchmarks. The Fund benefited from solid showings from a number of its
holdings, with its European stocks performing particularly well. Standouts
included the Fund's software and health-care stocks. Certain of the Fund's
financial-services and energy holdings also aided its return. On the negative
side, stocks that hindered the Fund included specific electronics and
telecommunications holdings.
With regard to regional allocation, we ended the period with a bias toward
the U.S., which accounted for roughly half of the Fund's assets as of October
31, 2000. We entered the period with an emphasis on Europe, but we shifted in
favor of the U.S., based on stock-specific factors and on our belief that
Europe's economies would slow vis-a-vis the U.S. economy. Elsewhere, we raised
our weighting in Japan, adding several companies late in the period that we
deemed to have attractive valuations and good growth potential. Other country
weightings worth noting included smaller but meaningful positions in Singapore
and Israel.
Stocks we added to the Fund included an Israel-based provider of
"telemedicine" systems that allow for the remote monitoring of vital health-care
information such as heart activity. The company stands to benefit from rapidly
maturing populations in Europe and the U.S. (where it has expanded its presence
via acquisitions) and from the desire to control health-care costs by minimizing
hospital stays, a particular goal of insurers. The company
8
<PAGE>
WARBURG PINCUS GLOBAL POST-VENTURECAPITAL FUND
ANNUAL INVESTMENT ADVISER'S REPORT -- OCTOBER 31, 2000 (CONT'D)
--------------------------------------------------------------------------------
received venture financing from Polaris Venture Capital, which has backed a
number of Israeli companies.
Other names we purchased included a young, rapidly growing venture-backed
software provider based in the U.K. The company's multimedia products enable
detailed monitoring of "call center" operations, for example by analyzing voice
patterns. In addition, we added a few stocks that represent indirect plays on
venture-backed companies, for example a leading Japanese provider of venture
financing.
We also added several U.S. stocks to the portfolio during the quarter. These
included one of the country's fastest-growing telecommunications companies. We
also added a TV/radio broadcaster and names representing the health-care and
retail sectors.
Looking ahead, we see grounds for optimism regarding global equities,
notwithstanding the recent difficulties in many markets. Certainly, worries over
the global economy and profits could weigh on stocks over the coming months, and
volatility will no doubt remain high. But we believe that a "soft landing"
scenario will ultimately prevail--most global economies are in fact growing, and
there is little to suggest that severe contractions are in the offing--allowing
for a more-benign interest-rate backdrop as well as returning a degree of
stability to stock markets. For our part, we will continue to focus on
innovative, well-financed companies with motivated managements (managers of
venture-backed companies are typically significant shareholders), attempting to
identify stocks with the brightest long-term prospects.
Elizabeth B. Dater Harold E. Sharon
Co-Portfolio Manager Co-Portfolio Manager
Federico D. Laffan Jun Sung Kim
Co-Portfolio Manager Co-Portfolio Manager
INTERNATIONAL INVESTING ENTAILS SPECIAL RISK CONSIDERATIONS, INCLUDING
CURRENCY FLUCTUATIONS, LOWER LIQUIDITY, ECONOMIC AND POLITICAL RISKS, AND
DIFFERENCES IN ACCOUNTING METHODS. THERE ARE ALSO SPECIAL RISK CONSIDERATIONS
ASSOCIATED WITH POST-VENTURE-CAPITAL INVESTMENTS. THESE ARE DETAILED IN THE
FUND'S PROSPECTUS, WHICH SHOULD BE READ CAREFULLY BEFORE INVESTING.
9
<PAGE>
WARBURG PINCUS GLOBAL POST-VENTURECAPITAL FUND
ANNUAL INVESTMENT ADVISER'S REPORT -- OCTOBER 31, 2000 (CONT'D)
--------------------------------------------------------------------------------
GROWTH OF $10,000 INVESTED IN ADVISOR CLASS SHARES OF WARBURG PINCUS
GLOBAL POST-VENTURE CAPITAL FUND SINCE INCEPTION AS OF OCTOBER 31, 2000
The graph below illustrates a hypothetical investment of $10,000 in Advisor
Class shares of Warburg Pincus Global Post-Venture Capital Fund (the "Fund")
from September 30, 1996 (inception) to October 31, 2000, compared to the Lipper
Global Funds Index ("Lipper")*, the Morgan Stanley World Index ("MSCI")** and
the Russell 2000 Growth Index ("Russell")*** for the same period.
[line graph omitted]
plot points as follows:
Fund Russell Lipper MSCI
10000 10000 10000 10000
10/31/96 9850 9568.7 10003 10055.9
11/30/96 10009.6 9834.81 10476.1 10603.2
12/31/96 10049.6 10026.6 10492.9 10419.2
01/31/97 10330 10277 10726.9 10529.6
02/28/97 9740.15 9656.52 10792.3 10635.5
03/31/97 9119.7 8975.16 10662.8 10410.1
04/30/97 9159.83 8871.4 10798.2 10735.2
05/31/97 10089.5 10204.9 11458 11382.4
06/30/97 10360 10550.9 11948.4 11935
07/31/97 11120.4 11091.5 12545.8 12469.7
08/31/97 10940.2 11424.4 11850.8 11620.4
09/30/97 11720.3 12336.1 12589.1 12236.6
10/31/97 11110.8 11595.2 11797.2 11577.3
11/30/97 10970.8 11319.2 11822 11767
12/31/97 10885.2 11326 11962.7 11895.1
01/31/98 10646.8 11175 12096.9 12211.4
02/28/98 11840.4 12161.5 12913.5 13021.8
03/31/98 12650.2 12671.7 13563.3 13555.9
04/30/98 13366.2 12749.4 13760.8 13672.5
05/31/98 12847.6 11823.2 13643.1 13485.4
06/30/98 13044.2 11944.1 13685.5 13789.7
07/31/98 12411.6 10946.7 13691.4 13751.6
08/31/98 9806.38 8419.73 11697.3 11901.7
09/30/98 10221.2 9273.4 11704 12096.1
10/31/98 10853.9 9757.1 12478.8 13173.4
11/30/98 11787.3 10514 13166.2 13940.6
12/31/98 12947.2 11465.5 13713.1 14605.3
01/31/99 13507.8 11981.2 13999.7 14908.6
02/28/99 14058.9 10885.2 13595.8 14495.6
03/31/99 15149.9 11272.9 14062.4 15082.7
04/30/99 16064.9 12268.4 14700.4 15660.7
05/31/99 15804.7 12287.8 14268.1 15071.8
06/30/99 18308.2 12935.1 14987.1 15758.4
07/31/99 19056.9 12534.1 15027.5 15694.2
08/31/99 19150.3 12065.3 15011.9 15648.7
09/30/99 19223.1 12298.2 14881.3 15479.7
10/31/99 19836.3 12613.2 15460.2 16267.6
11/30/99 25124.7 13946.4 16499.1 16708.5
12/31/99 31134.5 16405.1 18333.8 18044.7
01/31/00 32028.1 16252.4 17617.5 16994.5
02/29/00 39263.2 20033.6 18707.2 17024.9
03/31/00 38313 17927.9 19173 18185.1
04/30/00 34347.6 16117.7 18216.4 17399.9
05/31/00 31424.7 14706.5 17674.8 16943.1
06/30/00 33951.2 16606.2 18374.8 17496.7
07/31/00 32712 15183.1 18002.3 16987.9
08/31/00 37049.6 16780.2 18733.2 17524
09/30/00 35530.6 15946.6 17737.3 16576.3
10/31/00 31725.2 14652.2 17305.3 16282.9
--------------------------------------------------------------------------------
Average Annual
Total Returns
for periods ended
10/31/00
(Advisor Class shares)
--------------------------------------------------------------------------------
1 year
59.94%
--------------------------------------------------------------------------------
3 year
41.95%
--------------------------------------------------------------------------------
Since Inception
(9/30/96)
32.66%
--------------------------------------------------------------------------------
FUND
------
1 Year Total Return (9/30/99 to 9/30/00) 84.82%
3 Year Average Annual Total Return (9/30/97 to 9/30/00) 44.81%
Average Annual Total Return Since Inception
(9/30/96 to 9/30/00) 37.29%
--------------------------------------------------------------------------------
* The Lipper Global Funds Index is an equal-weighted performance index,
adjusted for capital-gains distributions and income dividends, of the
largest qualifying funds in this investment objective, and is compiled by
Lipper Inc.
** The Morgan Stanley World Index is a market-weighted average of the
performance of securities listed on the stock exchanges of all developed
countries.
*** The Russell 2000 Growth Index is an unmanaged index (with no defined
investment objective) of those securities in the Russell 2000 Index with a
greater-than-average growth orientation. It includes reinvestment of
dividends, and is compiled by Frank Russell Company.
10
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
-------- -----
COMMON STOCKS (76.1%)
CANADA (14.4%)
ELECTRICAL & ELECTRONICS (3.3%)
Descartes Systems Group, Inc.1 714,200 $ 28,946,976
------------
ENERGY (6.7%)
Anderson Exploration, Ltd.1 809,300 14,837,485
Berkley Petroleum Corp.1 1,442,000 7,553,495
Canadian Hunter Exploration, Ltd.1 420,300 8,806,474
Canadian Natural Resources, Ltd.1 668,000 19,682,565
Precision Drilling Corp.1 247,700 7,063,287
------------
57,943,306
------------
MEDIA (1.4%)
Rogers Communications, Inc. Class B 640,000 12,404,075
------------
TECHNOLOGY HARDWARE & EQUIPMENT (2.5%)
C-Mac Industries, Inc.1 392,500 21,783,750
------------
TELECOMMUNICATION SERVICES (0.5%)
Axxent, Inc.1 1,856,700 4,498,173
------------
TOTAL CANADA 125,576,280
------------
DENMARK (1.6%)
COMMERCIAL SERVICES & SUPPLIES (0.8%)
ISS AS 116,199 7,146,041
------------
TELECOMMUNICATION SERVICES (0.8%)
Tele Danmark AS Class B 137,000 6,474,974
------------
TOTAL DENMARK 13,621,015
------------
FINLAND (1.6%)
TECHNOLOGY HARDWARE & EQUIPMENT (1.2%)
Nokia Oyj Class A 248,900 10,230,357
------------
TELECOMMUNICATION SERVICES (0.4%)
Elisa Communication Oyj Class A 122,905 3,406,677
------------
TOTAL FINLAND 13,637,034
------------
FRANCE (9.2%)
BANKS (2.5%)
Banque Nationale de Paris 247,600 21,323,478
------------
CAPITAL GOODS (2.8%)
Vinci 492,700 24,744,838
------------
ENERGY (2.1%)
Coflexip SA 48,800 5,646,329
Coflexip SA ADR 39,100 2,231,144
Total Fina Elf SA 70,507 10,076,356
------------
17,953,829
------------
See Accompanying Notes to Financial Statements.
11
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS (CONT'D)--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------ -----
COMMON STOCKS (CONT'D)
FRANCE (cont'd)
MEDIA (1.8%)
Lagardere Groupe SCA 270,400 $ 15,333,684
------------
TOTAL FRANCE 79,355,829
------------
GERMANY (2.2%)
ENERGY (1.2%)
Rwe AG 256,300 10,297,710
------------
HEALTH CARE EQUIPMENT & SERVICES (0.1%)
Fresenius Medical ADR 25,000 665,625
------------
INSURANCE (0.9%)
Hannover Rueckversicherungs AG 94,600 7,970,604
------------
TOTAL GERMANY 18,933,939
------------
HUNGARY (0.8%)
BANKS (0.8%)
OTP Bank 144,100 6,675,691
------------
TOTAL HUNGARY 6,675,691
------------
INDIA (0.0%)
BANKS (0.0%)
State Bank of India, Ltd. 6,250 21,886
------------
ENERGY (0.0%)
Bharat Petroleum Corp., Ltd. 200 737
------------
MATERIALS (0.0%)
Hindalco Industries, Ltd. 203 3,098
Reliance Industries, Ltd. 12,010 77,740
------------
80,838
------------
TELECOMMUNICATION SERVICES (0.0%)
Mahanagar Telephone Nigam, Ltd. 300 903
------------
TOTAL INDIA 104,364
------------
ITALY (4.6%)
ENERGY (1.0%)
Saipem SpA 1,750,000 9,107,939
------------
INSURANCE (1.8%)
Riunione Adriatica di Sicurta SPA 1,183,000 15,512,749
------------
TRANSPORTATION (1.8%)
Concessioni e Costruzioni Autostrade SpA 2,635,000 15,299,769
------------
TOTAL ITALY 39,920,457
------------
See Accompanying Notes to Financial Statements.
12
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS (CONT'D)--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------ -----
COMMON STOCKS (CONT'D)
JAPAN (14.0%)
CAPITAL GOODS (1.0%)
Mitsubishi Electric Corp. 1,210,000 $ 8,688,271
------------
DIVERSIFIED FINANCIALS (1.1%)
Orix Corp. 86,400 9,060,479
------------
ELECTRICAL EQUIPMENT (3.3%)
Furukawa Electric Co., Ltd. 1,090,000 28,651,036
------------
HEALTH CARE EQUIPMENT & SERVICES (1.0%)
Hoya Corp. 109,800 9,070,700
------------
HOUSEHOLD DURABLES (1.1%)
Sony Corp. 125,000 9,982,939
------------
SEMICONDUCTOR EQUIPMENT & PRODUCTS (2.7%)
Rohm Co., Ltd. 54,100 13,630,751
Tokyo Electron, Ltd. 125,700 9,831,620
------------
23,462,371
------------
SOFTWARE (1.3%)
Konami, Ltd. 131,000 11,038,017
------------
WIRELESS TELECOMMUNICATION SERVICES (2.5%)
NTT DoCoMo, Inc. 891 21,951,384
------------
TOTAL JAPAN 121,905,197
------------
NETHERLANDS (4.9%)
BANKS (2.4%)
ABN AMRO Holding NV 898,500 20,791,912
------------
CAPITAL GOODS (1.4%)
IHC Caland NV 277,297 12,222,561
------------
CONSUMER DURABLES & APPAREL (1.1%)
Koninklijke (Royal) Philips Electronics NV 231,800 9,099,173
------------
TOTAL NETHERLANDS 42,113,646
------------
SINGAPORE (2.1%)
BANKS (1.3%)
Overseas Union Bank, Ltd. 2,194,288 10,624,821
------------
TRANSPORTATION (0.8%)
Neptune Orient Lines, Ltd.1 8,179,000 6,942,175
------------
TOTAL SINGAPORE 17,566,996
------------
SPAIN (2.5%)
BANKS (1.4%)
Banco Bilbao Vizcaya Argentaria SA 900,000 11,977,215
------------
FOOD & DRUG RETAILING (0.8%)
Centros Comerciales Pryca SA 558,214 7,064,383
------------
See Accompanying Notes to Financial Statements.
13
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS (CONT'D)--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------ -----
COMMON STOCKS (CONT'D)
SPAIN (cont'd)
MEDIA (0.3%)
Grupo Prisa SA1 112,600 $ 2,166,596
------------
TOTAL SPAIN 21,208,194
------------
SWEDEN (2.0%)
BANKS (2.0%)
Nordic Baltic Holding AB 2,285,400 17,106,800
------------
TOTAL SWEDEN 17,106,800
------------
SWITZERLAND (1.1%)
PHARMACEUTICALS & BIOTECHNOLOGY (1.1%)
Roche Holding AG 941 8,593,129
------------
TOTAL SWITZERLAND 8,593,129
------------
TAIWAN (2.3%)
CAPITAL GOODS (0.9%)
Ambit Microsystems Corp. 1,350,000 6,257,747
Siliconware Corp.1 3,399,900 1,502,433
------------
7,760,180
------------
TECHNOLOGY HARDWARE & EQUIPMENT (1.4%)
Taiwan Semiconductor Manufacturing Co. 3,967,808 12,016,270
------------
TOTAL TAIWAN 19,776,450
------------
UNITED KINGDOM (12.8%)
INSURANCE (1.0%)
Prudential PLC 749,907 10,094,473
------------
MEDIA (1.3%)
Reed International PLC 1,317,500 12,186,713
------------
PHARMACEUTICALS & BIOTECHNOLOGY (3.9%)
Astrazeneca Group PLC 447,400 20,971,333
Smithkline Beecham PLC 1,113,800 14,394,406
------------
35,365,739
------------
SOFTWARE & SERVICES (0.7%)
Misys PLC 667,786 6,962,389
------------
TELECOMMUNICATION SERVICES (2.8%)
Vodafone AirTouch PLC 6,145,345 25,588,582
------------
TRANSPORTATION (2.3%)
Railtrack Group PLC 1,359,036 21,037,043
------------
UTILITIES (0.8%)
International Power PLC 2,049,000 8,271,481
------------
TOTAL UNITED KINGDOM 119,506,420
------------
TOTAL COMMON STOCKS (Cost $615,744,158) 665,601,441
------------
See Accompanying Notes to Financial Statements.
14
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS (CONT'D)--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------ -----
PREFERRED STOCKS (2.0%)
GERMANY (2.0%)
HEALTH CARE EQUIPMENT & SERVICES (0.8%)
Fresenius Medical Care AG ADR 472,999 $ 6,917,610
------------
INSURANCE (1.2%)
Marschollek, Lautenschlaeger und Partner AG 81,600 10,997,678
------------
TOTAL GERMANY 17,915,288
------------
TOTAL PREFERRED STOCKS (Cost $14,343,639) 17,915,288
------------
WARRANT (0.5%)
CANADA (0.5%)
SOFTWARE & SERVICES (0.5%)
Wysdom, Inc. (Private Placement)
(Cost $4,163,896)1,2 365,254 4,163,896
------------
SHORT TERM INVESTMENTS (18.9%)
Institutional Money Market Trust 123,709,469 123,709,469
RBB Money Market Portfolio 41,430,309 41,430,309
------------
TOTAL SHORT TERM INVESTMENTS (Cost $165,139,778) 165,139,778
------------
TOTAL INVESTMENTS AT VALUE (97.5%) (Cost $799,391,471 3) 852,820,403
OTHER ASSETS IN EXCESS OF LIABILITIES (2.5%) 21,528,661
------------
NET ASSETS (100.0%) $874,349,064
============
INVESTMENT ABBREVIATIONS
ADR = American Depository Receipt
--------------------------------------------------------------------------------
1 Non-income producing security.
2 Illiquid.
3 Also cost for federal income tax purposes.
See Accompanying Notes to Financial Statements.
15
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
SCHEDULE OF INVESTMENTS--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------ -----
COMMON STOCKS (87.9%)
BRAZIL (10.8%)
ENERGY (2.6%)
Petroleo Brasileiro SA ADR (Common shares)1 22,200 $ 645,187
Petroleo Brasileiro SA ADR (Preference shares) 37,300 989,177
------------
1,634,364
------------
FOOD & DRUG RETAILING (1.3%)
Companhia Brasileira de Distribuicao Grupo
Pao de Acucar ADR 23,700 844,312
------------
FOOD, BEVERAGE & TOBACCO (1.6%)
Companhia de Bebidas das Americas (Ambev) ADR 44,875 1,012,492
------------
MATERIALS (1.3%)
Companhia Vale do Rio Doce ADR 36,000 841,500
------------
TELECOMMUNICATION SERVICES (3.5%)
Embratel Participacoes SA ADR 56,500 914,594
Tele Norte Leste Participacoes SA ADR 59,455 1,315,442
------------
2,230,036
------------
UTILITIES (0.5%)
Centrais Electricas Brasileiras ADR 33,600 298,425
------------
TOTAL BRAZIL 6,861,129
------------
CHILE (1.5%)
FOOD & DRUG RETAILING (0.4%)
Distribucion y Servicio SA ADR 15,400 275,275
------------
FOOD, BEVERAGE & TOBACCO (0.5%)
Compania Cervecerias Unidas SA ADR1 15,000 289,688
------------
TELECOMMUNICATION SERVICES (0.0%)
Companhia de Telecomunicaciones de Chile SA ADR1 100 1,525
------------
UTILITIES (0.6%)
Enersis SA ADR1 21,400 379,850
------------
TOTAL CHILE 946,338
------------
CHINA (5.4%)
ENERGY (1.8%)
PetroChina Co., Ltd. 5,348,000 1,124,619
------------
REAL ESTATE (0.1%)
China Resources Enterprises Co., Ltd. 40,000 45,135
------------
TELECOMMUNICATION SERVICES (2.0%)
China Unicom ADR1 63,265 1,296,933
------------
TRANSPORTATION (0.6%)
Guangshen Railway Co., Ltd. 3,121,476 380,236
------------
UTILITIES (0.9%)
Huaneng Power International, Inc. ADR 36,700 559,675
------------
TOTAL CHINA 3,406,598
------------
See Accompanying Notes to Financial Statements.
16
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
SCHEDULE OF INVESTMENTS (CONT'D)--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------ -----
COMMON STOCKS (CONT'D)
EGYPT (0.0%)
BANKS (0.0%)
Commercial International Bank, Ltd. 26 $ 228
------------
TOTAL EGYPT 228
------------
GREECE (2.8%)
BANKS (1.2%)
Alpha Credit Bank 20,705 763,644
------------
TELECOMMUNICATION SERVICES (1.6%)
Hellenic Telecommunication Organization SA ADR 113,200 990,500
------------
TOTAL GREECE 1,754,144
------------
HONG KONG (5.9%)
AUTOMOBILES & COMPONENTS (0.1%)
Denway Motors, Ltd.1 428,000 69,149
------------
CAPITAL GOODS (1.3%)
Citic Pacific, Ltd. 212,000 850,844
------------
CONSUMER DURABLES & APPAREL (0.1%)
Guangdong Kelon Electrical Holdings Co., Ltd. 40,738 7,574
Li & Fung, Ltd. 20,000 37,185
------------
44,759
------------
DIVERSIFIED FINANCIALS (0.0%)
Beijing Enterprises Holding Co. 11,100 10,105
------------
TECHNOLOGY HARDWARE & EQUIPMENT (1.3%)
Legend Holdings, Ltd. 944,000 798,888
------------
TELECOMMUNICATION SERVICES (3.1%)
China Mobile, Ltd.1 2,500 16,108
China Mobile, Ltd. ADR1 64,400 1,972,250
------------
1,988,358
------------
TOTAL HONG KONG 3,762,103
------------
HUNGARY (1.3%)
BANKS (0.5%)
OTP Bank RT 5,364 248,497
OTP Bank RT ADR 1,400 64,858
------------
313,355
------------
PHARMACEUTICALS & BIOTECHNOLOGY (0.2%)
Gedeon Richter 3,000 144,750
------------
TELECOMMUNICATION SERVICES (0.6%)
Matav RT ADR 14,800 347,800
------------
TOTAL HUNGARY 805,905
------------
See Accompanying Notes to Financial Statements.
17
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
SCHEDULE OF INVESTMENTS (CONT'D)--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------ -----
COMMON STOCKS (CONT'D)
INDIA (3.6%)
AUTOMOBILES & COMPONENTS (0.2%)
Mahindra & Mahindra, Ltd.1 1,750 $ 4,787
Mahindra and Mahindra, Ltd. GDR 31,400 86,350
------------
91,137
------------
BANKS (0.3%)
State Bank of India, Ltd. GDR 32,100 216,675
------------
CAPITAL GOODS (0.0%)
Larsen & Toubro, Ltd. 2,093 6,621
Larsen & Toubro, Ltd. GDR 1,800 11,340
------------
17,961
------------
DIVERSIFIED FINANCIALS (0.0%)
Morgan Stanley India Investment Fund, Inc.1 100 1,056
------------
ENERGY (0.2%)
Hindustan Petroleum Corp., Ltd. 32,400 73,989
Reliance Industries, Ltd. 4,659 30,157
------------
104,146
------------
FOOD, BEVERAGE & TOBACCO (0.4%)
ITC Agro-Tech, Ltd. GDR 15,200 275,880
------------
MATERIALS (1.1%)
Grasim Industries, Ltd. 500 2,170
Hindalco Industries, Ltd. GDR 12,500 190,000
Reliance Industries, Ltd. GDR 36,804 493,174
------------
685,344
------------
PHARMACEUTICALS & BIOTECHNOLOGY (0.2%)
Ranbaxy Laboratories, Ltd.1 7,200 124,200
------------
SOFTWARE & SERVICES (0.8%)
Infosys Technologies, Ltd. ADR1 3,500 481,250
Pentamedia Graphics, Ltd. 200 1,487
SSI, Ltd.1 8,400 38,892
------------
521,629
------------
TELECOMMUNICATION SERVICES (0.4%)
Videsh Sanchar Nigam, Ltd. ADR 30,800 227,150
------------
TOTAL INDIA 2,265,178
------------
ISRAEL (3.8%)
SOFTWARE & SERVICES (2.2%)
Check Point Software Technologies, Ltd.1 8,809 1,395,125
------------
TECHNOLOGY HARDWARE & EQUIPMENT (1.6%)
Orbotech, Ltd.1 18,850 997,872
------------
TOTAL ISRAEL 2,392,997
------------
See Accompanying Notes to Financial Statements.
18
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
SCHEDULE OF INVESTMENTS (CONT'D)--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------ -----
COMMON STOCKS (CONT'D)
MALAYSIA (3.8%)
BANKS (1.3%)
Malayan Banking BHD 211,000 $ 844,027
------------
HOTELS RESTAURANTS & LEISURE (1.1%)
Genting BHD 77,405 197,593
Resorts World 132,000 231,007
Tanjong PLC 130,000 242,902
------------
671,502
------------
TECHNOLOGY HARDWARE & EQUIPMENT (0.6%)
Digi.com BHD1 234,000 351,011
------------
UTILITIES (0.8%)
Tenaga Nasional BHD 160,351 519,047
------------
TOTAL MALAYSIA 2,385,587
------------
MEXICO (10.4%)
BANKS (2.1%)
Grupo Financiero Banamex Accival SA de CV Class O1 408,444 634,205
Grupo Financiero Bancomer SA de CV Class O1 1,154,810 714,350
------------
1,348,555
------------
FOOD, BEVERAGE & TOBACCO (2.2%)
Coca-Cola Femsa SA ADR 28,126 539,668
Grupo Modelo SA de CV Class C 321,143 855,691
------------
1,395,359
------------
MATERIALS (0.5%)
Cemex SA de CV ADR1 16,534 349,281
Kimberly-Clark de Mexico SA de CV Class A 17 43
------------
349,324
------------
MEDIA (1.1%)
Grupo Televisa SA1 12,700 687,388
------------
RETAILING (1.6%)
Wal-Mart de Mexico SA de CV1 42,000 1,011,579
------------
TELECOMMUNICATION SERVICES (2.9%)
Telefonos de Mexico SA ADR 34,000 1,833,875
------------
TOTAL MEXICO 6,626,080
------------
POLAND (0.5%)
TELECOMMUNICATION SERVICES (0.5%)
Telekomunikacja Polska SA 58,725 300,806
------------
TOTAL POLAND 300,806
------------
See Accompanying Notes to Financial Statements.
19
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
SCHEDULE OF INVESTMENTS (CONT'D)--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------ -----
COMMON STOCKS (CONT'D)
RUSSIA (3.2%)
ENERGY (2.5%)
Lukoil Holding ADR 16,700 $ 891,780
Surgutneftegaz ADR 50,700 651,495
------------
1,543,275
------------
UTILITIES (0.7%)
Unified Energy Systems ADR 37,200 470,580
------------
TOTAL RUSSIA 2,013,855
------------
SINGAPORE (0.0%)
BANKS (0.0%)
Oversea-Chinese Banking Corp., Ltd. 242 1,544
------------
MEDIA (0.0%)
Singapore Press Holdings, Ltd. 39 558
------------
TOTAL SINGAPORE 2,102
------------
SOUTH AFRICA (7.5%)
BANKS (1.5%)
Standard Bank Investment Corp., Ltd. 266,671 934,945
------------
CAPITAL GOODS (1.1%)
Imperial Holdings, Ltd.1 103,677 725,609
------------
DIVERSIFIED FINANCIALS (0.4%)
Johnnic Holdings, Ltd. 19,993 227,479
------------
FOOD, BEVERAGE & TOBACCO (1.1%)
South African Breweries PLC 120,223 720,527
------------
INSURANCE (1.4%)
Liberty Group, Ltd.1 120,305 918,383
------------
MATERIALS (2.0%)
Anglogold, Ltd. 14,101 401,100
Anglo American Platinum Corp., Ltd. 5,900 230,114
De Beers Consolidated Mines, Ltd. ADR 22,000 613,250
------------
1,244,464
------------
TOTAL SOUTH AFRICA 4,771,407
------------
SOUTH KOREA (9.5%)
BANKS (1.9%)
Housing & Commercial Bank of Korea 39,017 938,155
Housing & Commercial Bank of Korea GDR 1,823 44,208
Kookmin Bank 18,700 213,722
------------
1,196,085
------------
MATERIALS (0.6%)
Pohang Iron & Steel Co., Ltd. 5,600 325,427
Pohang Iron & Steel Co., Ltd. ADR 1,800 28,463
------------
353,890
------------
See Accompanying Notes to Financial Statements.
20
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
SCHEDULE OF INVESTMENTS (CONT'D)--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------ -----
COMMON STOCKS (CONT'D)
SOUTH KOREA (cont'd)
TECHNOLOGY HARDWARE & EQUIPMENT (2.1%)
Samsung Electro-Mechanics Co.1 8,750 $ 280,010
Samsung Electronics Co., Ltd. 8,605 1,078,026
------------
1,358,036
------------
TELECOMMUNICATION SERVICES (3.2%)
Korea Telecom Corp. 12,047 709,606
Korea Telecom Corp. ADR 1,800 66,375
SK Telecom Co., Ltd. 5,937 1,265,733
------------
2,041,714
------------
UTILITIES (1.7%)
Korea Electric Power Corp.1 45,510 1,016,258
Korea Electric Power Corp. ADR1 2,600 31,688
------------
1,047,946
------------
TOTAL SOUTH KOREA 5,997,671
------------
TAIWAN (11.0%)
BANKS (1.8%)
Bank Sinopac1 902,900 375,280
Chinatrust Commercial Bank 1,228,600 778,318
------------
1,153,598
------------
CONSUMER DURABLES & APPAREL (1.6%)
Far Eastern Textile, Ltd. 1,212,000 996,270
------------
MATERIALS (1.4%)
China Steel Corp. 399,000 230,572
Formosa Plastics Corp. 442,000 703,433
------------
934,005
------------
TECHNOLOGY HARDWARE & EQUIPMENT (6.2%)
Asustek Computer, Inc. 122,000 606,986
Hon Hai Precision Industry 45,500 237,624
Macronix International Co., Ltd. ADR1 1,935 27,332
Taiwan Semiconductor Manufacturing Co., Ltd.1 525,000 1,589,931
Taiwan Semiconductor Manufacturing Co., Ltd. ADR1 1,000 22,688
United Microelectronics Co., Ltd.1 471,620 830,730
Via Technologies, Inc.1 71,000 509,025
Winbond Electronics Corp.1 102,765 99,399
------------
3,923,715
------------
TOTAL TAIWAN 7,007,588
------------
TURKEY (6.3%)
BANKS (2.2%)
Dogan Yayin Holding AS1 60,564,486 789,418
Yapi Ve Kredi Bankasi AS1 68,502,224 591,910
------------
1,381,328
------------
See Accompanying Notes to Financial Statements.
21
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
SCHEDULE OF INVESTMENTS (CONT'D)--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------ ------
COMMON STOCKS (CONT'D)
TURKEY (cont'd)
CONSUMER DURABLES & APPAREL (0.6%)
Vestel Elektronik Sanayi Ve Ticaret AS1 1,900,000 $ 389,566
------------
DIVERSIFIED FINANCIALS (2.9%)
Koc Holding AS 9,676,166 616,441
Turkiye Is Bankasi AS Class C 63,832,800 1,215,308
------------
1,831,749
------------
TELECOMMUNICATION SERVICES (0.6%)
Turkcell Iletisim Hizmetleri AS ADR1 37,900 414,531
------------
TOTAL TURKEY 4,017,174
------------
UNITED STATES (0.6%)
SOFTWARE & SERVICES (0.6%)
AsiaInfo Holdings, Inc.1 33,100 401,338
------------
TOTAL UNITED STATES 401,338
------------
TOTAL COMMON STOCKS (Cost $60,052,214) 55,718,228
------------
PREFERRED STOCKS (0.5%)
BRAZIL (0.5%)
BANKS (0.5%)
Banco Itau SA1 3,837,808 298,633
------------
ENERGY (0.0%)
Petroleo Brasileiro SA 1 27
------------
TOTAL BRAZIL 298,660
------------
TAIWAN (0.0%)
BANKS (0.0%)
Taishin International Bank 735 225
------------
TOTAL TAIWAN 225
------------
TOTAL PREFERRED STOCKS (Cost $303,917) 298,885
------------
See Accompanying Notes to Financial Statements.
22
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
SCHEDULE OF INVESTMENTS (CONT'D)--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------ -----
RIGHT (0.0%)
THAILAND (0.0%)
TELECOMMUNICATION SERVICES (0.0%)
TelecomAsia Corp. Public Co., Ltd. (Cost $0)1 191,874 $ 0
-----------
SHORT TERM INVESTMENTS (5.8%)
Institutional Money Market Trust 604,224 604,224
RBB Money Market Portfolio 3,063,331 3,063,331
-----------
TOTAL SHORT TERM INVESTMENTS (Cost $3,667,555) 3,667,555
-----------
TOTAL INVESTMENTS AT VALUE (94.2%) (Cost $64,023,686 2) 59,684,668
OTHER ASSETS IN EXCESS OF LIABILITIES (5.8%) 3,700,902
-----------
NET ASSETS (100.0%) $63,385,570
===========
INVESTMENT ABBREVIATIONS
ADR = American Depository Receipt
GDR = Global Depository Receipt
--------------------------------------------------------------------------------
1 Non-income producing security.
2 Cost for federal income tax purposes is $65,384,434.
See Accompanying Notes to Financial Statements.
23
<PAGE>
WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND
SCHEDULE OF INVESTMENTS--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------- -----
COMMON STOCKS (89.8%)
BRAZIL (0.4%)
TELECOMMUNICATION SERVICES (0.4%)
Celular Crt Participacoes SA1 2,420,000 $ 793,813
-----------
TOTAL BRAZIL 793,813
-----------
CANADA (3.8%)
CAPITAL GOODS (0.6%)
ATS Automated Tooling Systems, Inc.1 50,000 887,221
Stuart Energy Systems Corp.1 23,000 347,882
-----------
1,235,103
-----------
ENERGY (0.5%)
Berkley Petroleum Corp.1 200,000 1,047,641
-----------
PHARMACEUTICALS & BIOTECHNOLOGY (0.5%)
Biovail Corp.1 27,900 1,173,544
-----------
MEDIA (0.7%)
Shaw Communications, Inc. Class B 77,900 1,601,819
-----------
SOFTWARE & SERVICES (1.3%)
Descartes Systems Group, Inc.1 72,500 2,938,471
-----------
TECHNOLOGY HARDWARE & EQUIPMENT (0.2%)
Nortel Networks Corp. 7,368 335,246
-----------
TOTAL CANADA 8,331,824
-----------
FRANCE (1.1%)
MEDIA (0.6%)
Ipsos SA 14,000 1,447,777
-----------
TECHNOLOGY HARDWARE & EQUIPMENT (0.5%)
Infovista SA1 26,670 1,028,604
-----------
TOTAL FRANCE 2,476,381
-----------
GERMANY (3.8%)
CAPITAL GOODS (1.3%)
Jenoptik AG 106,400 2,926,645
-----------
SOFTWARE & SERVICES (2.1%)
Articon Information Systems AG1 25,866 1,721,126
Intershop Communications AG1 15,300 674,386
Telesens AG1 43,900 2,307,119
-----------
4,702,631
-----------
TECHNOLOGY HARDWARE & EQUIPMENT (0.4%)
BE Semiconductor Industries NV 84,000 783,223
-----------
TOTAL GERMANY 8,412,499
-----------
INDIA (0.2%)
SOFTWARE & SERVICES (0.2%)
Silverline Technologies, Ltd. 67,500 437,788
-----------
TOTAL INDIA 437,788
-----------
See Accompanying Notes to Financial Statements.
24
<PAGE>
WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND
SCHEDULE OF INVESTMENTS (CONT'D)--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------- -----
COMMON STOCKS (CONT'D)
IRELAND (0.8%)
TELECOMMUNICATION SERVICES (0.8%)
Parthus Technologies PLC1 510,000 $ 1,740,342
-----------
TOTAL IRELAND 1,740,342
-----------
ISRAEL (4.0%)
HEALTH CARE EQUIPMENT & SERVICES (1.4%)
Card-Guard Scientific Survival, Ltd.1 52,000 3,130,544
-----------
SOFTWARE & SERVICES (1.2%)
Check Point Software Technologies, Ltd.1 16,000 2,534,000
-----------
TECHNOLOGY HARDWARE & EQUIPMENT (0.8%)
Audiocodes, Ltd.1 17,000 672,562
Gilat Satellite Networks1 22,300 1,141,481
-----------
1,814,043
-----------
TELECOMMUNICATION SERVICES (0.6%)
Amdocs, Ltd.1 20,560 1,332,545
-----------
TOTAL ISRAEL 8,811,132
-----------
JAPAN (5.9%)
COMMERCIAL SERVICES & SUPPLIES (1.2%)
Omega Project Co., Ltd.1 380,000 1,280,747
Venture Link Co., Ltd. 22,000 1,269,390
-----------
2,550,137
-----------
COMPUTERS & PERIPHERALS (0.6%)
Obic Co., Ltd. 4,000 1,337,164
-----------
DIVERSIFIED FINANCIALS (0.3%)
Japan Associated Finance Co., Ltd. 7,000 743,683
-----------
ELECTRICAL EQUIPMENT (1.7%)
Furukawa Electric Co., Ltd. 142,000 3,732,520
-----------
HEALTH CARE EQUIPMENT & SERVICES (0.4%)
Moritex Corp. 18,000 873,736
-----------
SPECIALTY RETAIL (0.2%)
Jac Co., Ltd. 27,400 529,499
-----------
TECHNOLOGY HARDWARE & EQUIPMENT (0.5%)
Micronics Japan Co., Ltd. 69,000 992,158
-----------
WIRELESS TELECOMMUNICATION SERVICES (1.0%)
NTT DoCoMo, Inc. 90 2,217,312
-----------
TOTAL JAPAN 12,976,209
-----------
LUXEMBURG (1.2%)
SOFTWARE & SERVICES (1.2%)
Thiel Logistik AG1 16,500 2,545,476
-----------
TOTAL LUXEMBURG 2,545,476
-----------
See Accompanying Notes to Financial Statements.
25
<PAGE>
WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND
SCHEDULE OF INVESTMENTS (CONT'D)--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------ -----
COMMON STOCKS (CONT'D)
NETHERLANDS (0.5%)
ENERGY (0.5%)
Petroplus International NV 77,386 $ 1,029,854
-----------
TOTAL NETHERLANDS 1,029,854
-----------
NORWAY (1.3%)
ENERGY (1.3%)
Fred Olsen Energy ASA1 120,000 870,950
Navis ASA1 1,100,000 1,431,154
Petroleum Geo - Services ADR1 41,300 565,294
-----------
2,867,398
-----------
TOTAL NORWAY 2,867,398
-----------
SINGAPORE (0.5%)
TECHNOLOGY HARDWARE & EQUIPMENT (0.5%)
Chartered Semiconductor Manufacturing, Ltd. ADR1 22,540 1,048,110
-----------
TOTAL SINGAPORE 1,048,110
-----------
SOUTH KOREA (0.1%)
TELECOMMUNICATION SERVICES (0.1%)
SK Telecom Co., Ltd. ADR 9,100 228,069
-----------
TOTAL SOUTH KOREA 228,069
-----------
SPAIN (1.7%)
DIVERSIFIED FINANCIALS (0.4%)
Dinamia Capital Privado Sociedad de Capital Riesgo SA 74,100 797,693
-----------
HOTELS, RESTAURANTS & LEISURE (0.6%)
NH Hoteles SA 125,500 1,414,846
-----------
SOFTWARE & SERVICES (0.7%)
Indra Sistemas SA 155,400 1,562,246
-----------
TOTAL SPAIN 3,774,785
-----------
SWEDEN (0.5%)
SOFTWARE & SERVICES (0.0%)
Protect Data AB1 7,800 90,302
-----------
TECHNOLOGY HARDWARE & EQUIPMENT (0.5%)
Micronic Laser System AB1 34,600 1,029,053
-----------
TOTAL SWEDEN 1,119,355
-----------
SWITZERLAND (2.0%)
CONSUMER DURABLES & APPAREL (1.2%)
Gretag Imaging Group 14,300 2,568,781
-----------
TECHNOLOGY HARDWARE & EQUIPMENT (0.8%)
Logitech International SA1 5,600 1,712,929
-----------
TOTAL SWITZERLAND 4,281,710
-----------
See Accompanying Notes to Financial Statements.
26
<PAGE>
WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND
SCHEDULE OF INVESTMENTS (CONT'D)--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------ -----
COMMON STOCKS (CONT'D)
TAIWAN (0.4%)
CAPITAL GOODS (0.4%)
Ambit Microsystems Corp. 201,000 $ 931,709
-----------
TOTAL TAIWAN 931,709
-----------
UNITED KINGDOM (11.3%)
BANKS (0.8%)
London Pacific Group, Ltd. ADR 122,800 1,734,550
-----------
COMMERCIAL SERVICES & SUPPLIES (0.5%)
Nestor Healthcare Group PLC 152,000 1,098,078
-----------
CONSUMER DURABLES & APPAREL (0.8%)
Mentmore Abbey PLC 573,000 1,659,946
-----------
DIVERSIFIED FINANCIALS (2.9%)
3i Group PLC 154,900 3,520,159
Amvescap PLC ADR 25,860 2,931,877
-----------
6,452,036
-----------
MEDIA (2.1%)
EMAP PLC 90,000 1,058,581
Eyretel PLC1 670,500 1,879,112
Informa Group PLC 163,000 1,781,110
-----------
4,718,803
-----------
PHARMACEUTICALS & BIOTECHNOLOGY (0.6%)
Oxford Glycosciences PLC1 36,500 1,323,716
-----------
SOFTWARE & SERVICES (2.0%)
Autonomy Corp. PLC1 43,800 2,238,790
Orchestream Holdings PLC1 267,000 2,142,102
-----------
4,380,892
-----------
TECHNOLOGY HARDWARE & EQUIPMENT (0.6%)
Arc International PLC1 276,300 1,354,101
-----------
TELECOMMUNICATION SERVICES (1.0%)
Bookham Technology PLC ADR1 25,100 845,556
Skyepharma PLC1 1,200,000 1,411,441
-----------
2,256,997
-----------
TOTAL UNITED KINGDOM 24,979,119
-----------
UNITED STATES (50.3%)
BANKS (0.8%)
Mellon Financial Corp. 37,300 1,799,725
-----------
CAPITAL GOODS (0.5%)
DSP Group, Inc.1 38,900 1,103,787
-----------
See Accompanying Notes to Financial Statements.
27
<PAGE>
WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND
SCHEDULE OF INVESTMENTS (CONT'D)--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------ -----
COMMON STOCKS (CONT'D)
UNITED STATES (cont'd)
COMMERCIAL SERVICES & SUPPLIES (1.3%)
Acxiom Corp.1 38,000 $ 1,529,500
DeVry, Inc.1 33,400 1,233,712
-----------
2,763,212
-----------
CONSUMER DURABLES (1.8%)
Polycom, Inc.1 42,400 2,756,000
ValueVision International, Inc.1 56,400 1,142,100
-----------
3,898,100
-----------
DIVERSIFIED FINANCIALS (1.9%)
Gabelli Asset Management, Inc. Class A1 49,400 1,778,400
Knight Trading Group, Inc.1 48,800 1,460,950
T. Rowe Price Associates, Inc. 20,300 950,294
-----------
4,189,644
-----------
ENERGY (2.4%)
Chaparral Resources, Inc.1 5,556 36,114
Cooper Cameron Corp.1 30,600 1,667,700
Nabors Industries, Inc.1 30,400 1,547,360
Newfield Exploration Co.1 52,900 1,996,975
-----------
5,248,149
-----------
HEALTHCARE EQUIPMENT & SERVICES (4.0%)
Advance Paradigm, Inc.1 83,600 4,085,950
Community Health Care1 116,800 3,292,300
Oxford Health Plans, Inc.1 44,200 1,491,750
-----------
8,870,000
-----------
HOTELS, RESTAURANTS & LEISURE (1.3%)
MGM Mirage, Inc. 61,700 2,132,506
New York Restaurant Group, Inc.1,2 77,720 749,998
-----------
2,882,504
-----------
INSURANCE (0.9%)
Ambac Financial Group, Inc. 23,500 1,875,594
-----------
LIMITED PARTNERSHIPS (1.4%)
Boston Ventures V L.P.3 876,235 876,235
New Enterprise Associates VII L.P.3 2,114,600 2,114,600
-----------
2,990,835
-----------
MEDIA (5.5%)
Cablevision Systems Corp.1 20,600 1,534,700
Clear Channel Communications, Inc.1 14,570 875,111
Entravision Communications Corp.1 104,400 1,846,575
Getty Images, Inc.1 31,800 1,009,650
Harte-Hanks Communications, Inc. 69,300 1,533,262
MaMaMedia, Inc.1,2 92,592 499,997
TMP Worldwide, Inc.1 23,400 1,628,859
See Accompanying Notes to Financial Statements.
28
<PAGE>
WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND
SCHEDULE OF INVESTMENTS (CONT'D)--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------ -----
COMMON STOCKS (CONT'D)
UNITED STATES (cont'd)
MEDIA (cont'd)
USA Networks, Inc.1 73,400 $ 1,486,350
Westwood One, Inc.1 96,900 1,835,044
-----------
12,249,548
-----------
PHARMACEUTICALS & BIOTECHNOLOGY (4.7%)
Affymetrix, Inc.1 13,600 753,100
Amgen, Inc.1 19,400 1,123,987
Celgene Corp.1 15,200 978,500
Gilead Sciences, Inc.1 11,300 971,800
IVAX Corp.1 54,600 2,375,100
Millennium Pharmaceuticals, Inc.1 14,700 1,066,669
Praecis Pharmaceuticals, Inc.1 35,800 908,425
Progenics Pharmaceuticals, Inc.1 44,200 1,088,425
Watson Pharmaceuticals, Inc.1 17,100 1,069,819
-----------
10,335,825
-----------
REAL ESTATE (0.2%)
Pinnacle Holdings, Inc.1 31,780 500,535
-----------
RETAILING (0.3%)
AnnTaylor Stores Corp.1 27,900 837,000
-----------
SOFTWARE & SERVICES (9.9%)
BEA Systems, Inc.1 38,700 2,776,725
BISYS Group, Inc.1 36,800 1,734,200
Documentum, Inc.1 20,900 1,776,500
Excalibur Technologies Corp.1 78,200 4,604,025
Exodus Communications, Inc.1 39,200 1,315,650
Inktomi Corp.1 13,900 881,781
Intuit, Inc.1 56,500 3,471,219
Juniper Networks, Inc.1 16,700 3,256,500
Netcentives, Inc.1 1,728 12,312
Planetweb, Inc.1,2 183,800 999,872
Veritas Software Corp.1 7,350 1,036,465
-----------
21,865,249
-----------
TECHNOLOGY HARDWARE & EQUIPMENT (11.7%)
Avanex Corp.1 10,400 1,056,250
Broadcom Corp., Class A 14,854 3,303,158
C-Mac Industries, Inc.1 25,000 1,387,500
CIENA Corp.1 36,270 3,812,884
Cisco Systems, Inc.1 119,332 6,429,011
Flextronics International, Ltd.1 81,400 3,093,200
KLA-Tencor Corp.1 13,800 466,613
Manufacturers' Services Ltd. 44,400 435,675
Maxim Integrated Products, Inc.1 25,140 1,667,096
Network Appliance, Inc.1 8,660 1,030,540
Sun Microsystems, Inc.1 28,200 3,126,675
-----------
25,808,602
-----------
See Accompanying Notes to Financial Statements.
29
<PAGE>
WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND
SCHEDULE OF INVESTMENTS (CONT'D)--OCTOBER 31, 2000
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------ -----
COMMON STOCKS (CONT'D)
UNITED STATES (cont'd)
TELECOMMUNICATION SERVICES (1.7%)
Foundry Networks, Inc.1 19,700 $ 1,308,819
Globespan, Inc. 8,200 630,888
Redback Networks Inc. 11,900 1,266,606
Sycamore Networks, Inc.1 10,400 657,800
------------
3,864,113
------------
TOTAL UNITED STATES 111,082,422
------------
TOTAL COMMON STOCKS (Cost $168,668,600) 197,867,995
------------
WARRANTS (0.2%)
CANADA (0.2%)
DIVERSIFIED TELECOMMUNICATION SERVICES (0.0%)
OCI Communications, Inc.1 90,600 219,494
------------
SOFTWARE & SERVICES (0.0%)
Wysdom, Inc. (Private Placement)1,2 20,000 228,000
------------
TOTAL CANADA 447,494
------------
TOTAL WARRANTS (Cost $1,239,045) 447,494
------------
SHORT TERM INVESTMENTS (7.2%)
Institutional Money Market Trust 5,580,201 5,580,201
RBB Money Market Portfolio 10,285,489 10,285,489
------------
TOTAL SHORT TERM INVESTMENTS (Cost $15,865,690) 15,865,690
------------
MATURITY RATE% PAR
-------- ----- -------
U.S. TREASURY OBLIGATIONS (0.3%)
U.S. Treasury Bill 01/04/01 5.780 $529,000 523,253
U.S. Treasury Note 11/30/01 5.875 220,000 219,107
------------
TOTAL U.S. TREASURY OBLIGATIONS (Cost $743,119) 742,360
------------
TOTAL INVESTMENTS AT VALUE (97.5%) (Cost $186,516,454 4) 214,923,539
OTHER ASSETS IN EXCESS OF LIABILITIES (2.5%) 5,512,041
------------
NET ASSETS (100.0%) $220,435,580
============
INVESTMENT ABBREVIATIONS
ADR = American Depository Receipt
--------------------------------------------------------------------------------
1 Non-income producing security.
2 Illiquid security.
3 Restricted security.
4 Cost for federal income tax purposes is $186,951,959.
See Accompanying Notes to Financial Statements.
30
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
October 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INTERNATIONAL EMERGING GLOBAL POST-VENTURE
EQUITY MARKETS CAPITAL
------------ ----------- -------------------
<S> <C> <C> <C>
ASSETS
Investments at value (Cost - $799,391,471,
$64,023,686, and $186,516,454, respectively) $852,820,403 $59,684,668 $214,923,539
Foreign currency (Cost - $3,557,024, $2,905,212
and $130,873 respectively) 3,495,624 2,816,158 125,717
Receivable for investments sold 52,066,424 52,653 5,635,288
Receivable for Fund shares sold 23,259,363 1,556,175 1,552,359
Dividends, interest and reclaim receivable 1,726,491 26,449 108,660
Receivable from investment adviser 0 67,900 0
Prepaid expenses and other assets 107,917 64,868 46,494
------------ ----------- ------------
Total Assets 933,476,222 64,268,871 222,392,057
------------ ----------- ------------
LIABILITIES
Advisory fee payable 764,947 54,721 30,692
Administrative fee payable 76,495 2,611 42,848
Directors' fee payable 3,175 2,826 2,825
Payable for investments purchased 56,101,466 713,819 1,350,779
Payable for Fund shares redeemed 1,221,245 40,091 287,497
Accrued expenses payable 959,830 61,452 241,836
Other liabilities 0 7,781 0
------------ ----------- ------------
Total Liabilities 59,127,158 883,301 1,956,477
------------ ----------- ------------
NET ASSETS
Capital stock, $0.001 par value 43,702 7,017 7,971
Paid-in capital 642,117,846 108,495,400 195,743,374
Accumulated undistributed net investment income 4,862,639 185,785 0
Accumulated net realized gain (loss) from investments
and foreign currency transactions 174,148,850 (40,874,777) (3,701,674)
Net unrealized appreciation (depreciation) from
investments and foreign currency translations 53,176,027 (4,427,855) 28,385,909
------------ ----------- ------------
Net Assets $874,349,064 $63,385,570 $220,435,580
============ =========== ============
COMMON SHARES
Net assets $708,317,180 $60,481,869 $211,822,049
------------ ----------- ------------
Shares outstanding 35,292,874 6,696,304 7,655,976
------------ ----------- ------------
Net asset value, offering price and redemption price
per share $ 20.07 $ 9.03 $ 27.67
============ =========== ============
ADVISOR SHARES
Net assets $166,031,884 $ 66,421 $ 8,613,531
------------ ----------- ------------
Shares outstanding 8,408,724 7,567 314,797
------------ ----------- ------------
Net asset value, offering price and redemption price
per share $ 19.75 $ 8.78 $ 27.36
============ =========== ============
INSTITUTIONAL SHARES
Net assets $ N/A $ 2,837,280 $ N/A
------------ ----------- ------------
Shares outstanding N/A 313,520 N/A
------------ ----------- ------------
Net asset value, offering price and redemption price
per share $ N/A $ 9.05 $ N/A
============ =========== ============
</TABLE>
See Accompanying Notes to Financial Statements.
31
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
STATEMENTS OF OPERATIONS
For the Year Ended October 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GLOBAL
INTERNATIONAL EMERGING POST-VENTURE
EQUITY MARKETS CAPITAL
------------- ------------ ------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Dividends $ 17,387,610 $ 3,284,632 $ 468,770
Interest 2,643,490 204,651 795,816
Foreign Taxes Withheld (1,222,512) (133,268) (55,593)
------------- ------------ ------------
Total investment income 18,808,588 3,356,015 1,208,993
------------- ------------ ------------
EXPENSES:
Investment advisory fees 12,091,912 1,124,537 1,719,601
Administrative Services fees 2,230,242 177,220 307,556
Shareholder servicing/distribution fees 1,198,464 217,229 356,200
Transfer agent fees 935,883 138,325 203,327
Custodian/Sub-custodian fees 844,626 139,131 79,978
Interest expense 494,989 148,803 962
Printing fees 308,989 104,108 73,381
Audit fees 80,677 17,721 17,953
Registration fees 65,920 80,562 106,189
Legal fees 63,583 40,920 26,907
Directors fees 12,955 5,375 9,163
Insurance expense 0 2,238 1,829
Offering/Organizational costs 0 7,386 805
Miscellaneous expense 47,532 0 6,056
------------- ------------ ------------
18,375,772 2,203,555 2,909,907
Less: fees waived and
transfer agent offsets (246,504) (728,419) (627,754)
------------- ------------ ------------
Total expenses 18,129,268 1,475,136 2,282,153
------------- ------------ ------------
Net investment income (loss) 679,320 1,880,879 (1,073,160)
------------- ------------ ------------
NET REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENTS
AND FOREIGN CURRENCY RELATED ITEMS:
Net realized gain (loss) from investments
(net of capital gains taxes of $1,479,574
for Emerging Markets 204,055,535 18,272,445 (3,618,756)
Net realized loss from foreign
currency transactions (2,056,135) (524,520) (52,793)
Net change in unrealized appreciation
(depreciation) from investments (203,705,985) (15,159,359) (17,437,246)
Net change in unrealized appreciation
(depreciation) from foreign currency
translations (net of estimated
deferred capital gain taxes of
$(46,366) for Emerging Markets) (60,791) (1,275,338) (16,094)
------------- ------------ ------------
Net realized and unrealized gain (loss) from
investments and foreign currency related items (1,767,376) 1,313,228 (21,124,889)
------------- ------------ ------------
Net increase (decrease) in net assets
resulting from operations $ (1,088,056) $ 3,194,107 $(22,198,049)
============= ============ ============
</TABLE>
See Accompanying Notes to Financial Statements.
32
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY
-----------------------------------
FOR THE FOR THE
YEAR ENDED YEAR ENDED
OCTOBER 31, 2000 OCTOBER 31, 1999
---------------- ----------------
<S> <C> <C>
FROM OPERATIONS:
Net investment income $ 679,320 $ 6,265,096
Net realized gain from investments and foreign
currency transactions 201,999,400 141,496,862
Net change in unrealized appreciation
(depreciation) from investments
and foreign currency translations (203,766,776) 205,467,968
-------------- ---------------
Net increase (decrease) in net assets
resulting from operations (1,088,056) 353,229,926
-------------- ---------------
FROM DIVIDENDS:
Dividends from net investment income
Common Class shares (6,691,499) 0
Advisor Class Shares (449,429) 0
-------------- ---------------
Net decrease in net assets from dividends (7,140,928) 0
-------------- ---------------
FROM CAPITAL SHARE TRANSACTIONS:
Proceeds from sale of shares 3,134,024,802 1,825,106,334
Reinvestment of dividends 6,699,210 0
Net asset value of shares redeemed (3,460,666,486) (2,559,755,180)
-------------- ---------------
Net decrease in net assets from capital
share transactions (319,942,474) (734,648,846)
-------------- ---------------
Net decrease in net assets (328,171,458) (381,418,920)
NET ASSETS:
Beginning of year 1,202,520,522 1,583,939,442
-------------- ---------------
End of year $ 874,349,064 $ 1,202,520,522
============== ===============
UNDISTRIBUTED NET INVESTMENT INCOME: $ 4,862,639 $ 5,901,701
============== ===============
</TABLE>
See Accompanying Notes to Financial Statements.
33
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
STATEMENTS OF CHANGES IN NET ASSETS (CONT'D)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
EMERGING MARKETS GLOBAL POST-VENTURE CAPITAL
--------------------------------- ---------------------------------
FOR THE FOR THE FOR THE FOR THE
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
OCTOBER 31, 2000 OCTOBER 31, 1999 OCTOBER 31, 2000 OCTOBER 31, 1999
---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
FROM OPERATIONS:
Net investment income (loss) $ 1,880,879 $ 361,573 $ (1,073,160) $ (33,163)
Net realized gain (loss) from investments
and foreign currency transactions
(net of capital gains taxes of
$1,479,574 and $722,400, respectively,
for Emerging Markets) 17,747,925 2,606,242 (3,671,549) 1,880,888
Net change in unrealized appreciation
(depreciation) from investments and
foreign currency translations (net of
estimated deferred capital gains taxes
of $(46,366) and $46,366, respectively,
for Emerging Markets) (16,434,697) 20,089,488 (17,453,340) 1,068,574
------------- ------------- ------------- -----------
Net increase (decrease) in net assets
resulting from operations 3,194,107 23,057,303 (22,198,049) 2,916,299
------------- ------------- ------------- -----------
FROM DISTRIBUTIONS:
Distributions from net realized gains
Common Class shares 0 0 (1,914,397) (11,449)
Advisor Class shares 0 0 (15,707) (4)
------------- ------------- ------------- -----------
Net decrease in net assets from
distributions 0 0 (1,930,104) (11,453)
------------- ------------- ------------- -----------
FROM CAPITAL SHARE TRANSACTIONS:
Proceeds from sale of shares 341,488,567 164,611,366 280,571,617 4,476,418
Exchange value of shares due to merger 7,789,270 0 90,509,223 0
Reinvestment of distributions 0 0 1,656,495 11,073
Net asset value of shares redeemed (356,911,101) (180,058,486) (135,490,070) (3,738,167)
------------- ------------- ------------- -----------
Net increase (decrease) in net assets
from capital share transactions (7,633,264) (15,447,120) 237,247,265 749,324
------------- ------------- ------------- -----------
Net increase (decrease) in net assets (4,439,157) 7,610,183 213,119,112 3,654,170
NET ASSETS:
Beginning of year 67,824,727 60,214,544 7,316,468 3,662,297
------------- ------------- ------------- -----------
End of year $ 63,385,570 $ 67,824,727 $ 220,435,580 $ 7,316,467
============= ============= ============= ===========
UNDISTRIBUTED NET INVESTMENT INCOME: $ 185,785 $ 0 $ 0 $ 0
============= ============= ============= ===========
</TABLE>
See Accompanying Notes to Financial Statements.
34
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
FINANCIAL HIGHLIGHTS
(For an Advisor Class share of the Fund Outstanding Throughout Each Year)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE YEAR ENDED OCTOBER 31
-------------------------------------------------
2000 1999 1998 1997 1996
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
PER-SHARE DATA
Net asset value, beginning of year $ 21.54 $ 16.47 $ 20.54 $ 20.50 $ 19.16
-------- -------- -------- -------- --------
INVESTMENT ACTIVITIES:
Net investment income (loss) (0.12) 0.03 0.041 0.04 0.18
Net gains (losses) on investments
and foreign currency related items
(both realized and unrealized) (1.63) 5.04 (1.36) 0.78 1.68
-------- -------- -------- -------- --------
Total from investment activities (1.75) 5.07 (1.32) 0.82 1.86
-------- -------- -------- -------- --------
LESS DIVIDENDS AND DISTRIBUTIONS:
Dividends from net investment income (0.04) 0.00 (0.03) (0.04) (0.52)
Distributions from net realized gains 0.00 0.00 (2.72) (0.74) 0.00
-------- -------- -------- -------- --------
Total dividends and distributions (0.04) 0.00 (2.75) (0.78) (0.52)
-------- -------- -------- -------- --------
NET ASSET VALUE, END OF YEAR $ 19.75 $ 21.54 $ 16.47 $ 20.54 $ 20.50
======== ======== ======== ======== ========
Total return (8.15)% 30.78% (6.49)% 4.04% 9.89%
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of year (000s omitted) $166,032 $231,990 $300,266 $500,473 $500,465
Ratio of expenses to average
net assets2 1.92% 1.94% 1.76% 1.76% 1.81%
Ratio of net investment income to
average net assets (.34)% .14% .21% .15% .18%
Portfolio turnover rate 113.17% 116.35% 95.44% 61.80% 32.49%
</TABLE>
--------------------------------------------------------------------------------
1 Per share information is calculated using the average shares outstanding
method.
2 Interest earned on uninvested cash balances is used to offset portions of the
transfer agent expenses. These arrangements resulted in a reduction to the
Advisor Class shares' expenses by .02%, .01%, .00%, .01% and .01% for the
years October 31, 2000, 1999, 1998, 1997 and 1996, respectively. The Advisor
Class shares' operating expense ratios after reflecting these arrangements
were 1.90%, 1.93%, 1.76%, 1.75% and 1.80% for each of the years ended October
31, 2000, 1999, 1998, 1997 and 1996, respectively.
See Accompanying Notes to Financial Statements.
35
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
FINANCIAL HIGHLIGHTS
(For an Advisor Class share of the Fund Outstanding Throughout Each Year)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE YEAR ENDED OCTOBER 31
-------------------------------------------
2000 1999 1998 1997 1996
------ ------ ------- ------- -------
<S> <C> <C> <C> <C> <C>
PER-SHARE DATA
Net asset value, beginning of year $ 9.03 $ 6.44 $ 10.87 $ 12.21 $ 11.30
------ ------ ------- ------- -------
INVESTMENT ACTIVITIES:
Net investment income (loss) 0.07 0.04 0.21 0.00 (0.08)
Net gains (losses) on investments
and foreign currency related items
(both realized and unrealized) (0.32) 2.55 (4.16) (1.33) 1.11
------ ------ ------- ------- -------
Total from investment activities (0.25) 2.59 (3.95) (1.33) 1.03
------ ------ ------- ------- -------
LESS DIVIDENDS AND DISTRIBUTIONS:
Dividends from net investment income 0.00 0.00 (0.04) 0.00 (0.05)
Distributions from net realized gains 0.00 0.00 (0.44) (0.01) (0.07)
------ ------ ------- ------- -------
Total dividends and distributions 0.00 0.00 (0.48) (0.01) (0.12)
------ ------ ------- ------- -------
NET ASSET VALUE, END OF YEAR $ 8.78 $ 9.03 $ 6.44 $ 10.87 $ 12.21
====== ====== ======= ======= =======
Total return (2.77)% 40.22% (37.71)% (10.94)% 9.20%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year (000s omitted) $ 67 $ 42 $ 26 $ 266 $ 149
Ratio of expenses to average
net assets1 1.92% 1.91% 1.90% 1.90% 1.90%
Ratio of net investment income (loss)
to average net assets .29% .81% 1.01% (.09)% (.57)%
Decrease reflected in above
operating expense ratios due to
waivers/reimbursements .75% .80% .94% .58% .65%
Portfolio turnover rate 232.47% 196.07% 125.59% 92.48% 61.84%
</TABLE>
--------------------------------------------------------------------------------
1 Interest earned on uninvested cash balances is used to offset portions of the
transfer agent expense. These arrangements resulted in a reduction to the
Advisor Class shares' expenses by .02%, .01%, .00%, .00% and .00% for each of
the years ended October 31, 2000, 1999, 1998, 1997 and 1996, respectively.
The Advisor Class shares' operating expense ratios after reflecting these
arrangements were 1.90% for each of the years ended October 31, 2000, 1999,
1998, 1997 and 1996, respectively.
See Accompanying Notes to Financial Statements.
36
<PAGE>
WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND
FINANCIAL HIGHLIGHTS
(For an Advisor Class share of the Fund Outstanding Throughout Each Period)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE YEAR ENDED OCTOBER 31
------------------------------------------
2000 1999 1998 1997 1996 1
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
PER-SHARE DATA
Net asset value, beginning of period $19.09 $10.46 $11.11 $ 9.85 $10.00
------ ------ ------ ------ ------
INVESTMENT ACTIVITIES:
Net investment loss (0.16) (0.12)2 (0.15) (0.15) 0.00
Net gains (losses) on investments and
foreign currency related items (both
realized and unrealized) 11.24 8.78 (0.11) 1.41 (0.15)
------ ------ ------ ------ ------
Total from investment activities 11.08 8.66 (0.26) 1.26 (0.15)
------ ------ ------ ------ ------
LESS DIVIDENDS AND DISTRIBUTIONS:
Dividends from net investment income 0.00 0.00 (0.28) 0.00 0.00
Distributions from net realized gains (2.81) (0.03) (0.11) 0.00 0.00
------ ------ ------ ------ ------
Total dividends and distributions (2.81) (0.03) (0.39) 0.00 0.00
------ ------ ------ ------ ------
NET ASSET VALUE, END OF PERIOD $27.36 $19.09 $10.46 $11.11 $ 9.85
====== ====== ====== ====== ======
Total return 59.94% 83.06% (2.31)% 12.79% (1.50)%3
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period
(000s omitted) $8,614 $ 54 $ 1 $ 1 $ 6
Ratio of expenses to average
net assets4 1.92% 1.91% 1.90% 1.90% 1.90%5
Ratio of net investment loss to
average net assets (1.02)% (1.24)% (1.26)% (1.15)% (.78)%5
Decrease reflected in above operating
expense ratios due to
waivers/reimbursements .44% 1.27% 45.95% 11.16% 22.23%5
Portfolio turnover rate 95.51% 239.88% 186.67% 207.25% 5.85%
</TABLE>
--------------------------------------------------------------------------------
1 For the period September 30, 1996 (inception date) through October 31, 1996.
2 Per share information is calculated using the average shares outstanding
method.
3 Non annualized.
4 Interest earned on uninvested cash balances is used to offset portions of the
transfer agent expenses. These arrangements resulted in a reduction to the
Advisor Class shares' expenses by .02%, .01%, .00%, .00% and .00% for each of
the years ended October 31, 2000, 1999, 1998 and 1997 and for the period
ended October 31, 1996, respectively. The Advisor Class shares' operating
expense ratios after reflecting these arrangements were 1.90% for each of the
years ended October 31, 2000, 1999, 1998, and 1997 and for the period ended
October 31, 1996, respectively.
5 Annualized.
See Accompanying Notes to Financial Statements.
37
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS
October 31, 2000
--------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
The Warburg Pincus International Equity Fund ("International Equity") and the
Warburg Pincus Global Post-Venture Capital Fund ("Global Post-Venture Capital"),
each a Maryland Corporation, are registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as diversified, open-end management
investment companies, and the Warburg Pincus Emerging Markets Fund ("Emerging
Markets"), a Maryland Corporation, is registered under the 1940 Act as a
non-diversified, open-end management investment company (each, a "Fund" and
collectively, the "Funds").
Investment objectives for each Fund are as follows: International Equity
seeks long-term capital appreciation; Emerging Markets seeks growth of capital;
and Global Post-Venture Capital seeks long-term growth of capital.
Emerging Markets offers three classes of shares, one class being referred to
as the Common Class, one class being referred to as the Advisor Class, and one
class being referred to as the Institutional Class. International Equity and
Global Post-Venture Capital currently offer the Common Class shares and Advisor
Class shares. Common, Advisor, and Institutional shares in each Fund represent
an equal pro rata interest in each Fund, except that they bear different
expenses which reflect the difference in the range of services provided to them.
Common Class shares for Emerging Markets and Global Post-Venture Capital bear
expenses paid pursuant to a shareholder servicing and distribution plan at an
annual rate of .25% of the average daily net asset value of each Fund's Common
Class shares. Common Class shares of International Equity and Institutional
Class shares of Emerging Markets are not subject to shareholder servicing or
distribution fees. Advisor Class shares bear expenses paid pursuant to a
distribution plan at an annual rate not to exceed .75% of the average daily net
asset value of the relevant Fund's Advisor Class shares. Advisor Class shares
are currently bearing expenses of .50% of average daily net assets.
Effective close of business on February 25, 2000, Global Post-Venture Capital
acquired all of the net assets of the Warburg Pincus Post-Venture Capital Fund
("Post-Venture Capital") in a tax-free exchange of shares. The shares exchanged
were 2,547,701 shares (valued at $85,282,770) of the Common Class of Global
Post-Venture Capital for 3,239,800 shares of the Common Class of Post-Venture
Capital and 157,637 shares (valued at $5,226,453) of the Advisor Class of Global
Post-Venture Capital for 202,781 shares of the Advisor Class of Post-Venture
Capital. Post-Venture Capital's net assets of $90,509,223 at that date, which
consisted of $44,516,377 of unrealized appreciation, were combined with those of
Global Post-Venture Capital. The aggregate net assets of Post-Venture Capital
and Global Post-
38
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 2000
--------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES -- (CONT'D)
Venture Capital immediately before the acquisition were $90,509,223 and
$64,801,541, respectively and the combined net assets of Global Post-Venture
Capital were $155,310,764.
Effective close of business on February 11, 2000, Emerging Markets acquired
all of the net assets of the Warburg Pincus Emerging Markets II Fund ("Emerging
Markets II") in a tax-free exchange of shares. The shares exchanged were 119,041
shares (valued at $1,697,652) of the Common Class of Emerging Markets for 79,472
shares of the Common Class of Emerging Markets II and 427,128 shares (valued at
$6,091,618) of the Institutional Class of Emerging Markets for 285,285 shares of
the Institutional Class of Emerging Markets II. The Emerging Markets II net
assets of $7,789,270 at that date, which consisted of $1,364,481 of unrealized
appreciation, were combined with those of Emerging Markets. The aggregate net
assets of Emerging Markets II and Emerging Markets immediately before the
acquisition were $7,789,270 and $124,330,766, respectively and the combined net
assets of Emerging Markets were $132,120,036.
The net asset value of each Fund is determined daily as of the close of
regular trading on the New York Stock Exchange. Each Fund's investments are
valued at market value, which is generally determined using the last reported
sales price. If no sales are reported, investments are generally valued at the
last reported bid price. If market quotations are not readily available,
securities and other assets are valued by another method that the Board of
Directors believes accurately reflects fair value. Debt obligations that will
mature in 60 days or less are valued on the basis of amortized cost, which
approximates market value, unless the Board determines that using this method
would not reflect an investment's value.
Global Post-Venture Capital initially values its investments in
private-equity portfolios at cost. After that, the Fund values these investments
according to reports from the private-equity portfolios that Abbott Capital
Management, LLC ("Abbott"), the Fund's sub-investment adviser, generally
receives on a quarterly basis. The Fund's net asset value typically will not
reflect interim changes in the values of its private-equity-portfolio
investments.
The books and records of the Funds are maintained in U.S. dollars.
Transactions denominated in foreign currencies are recorded at the current
prevailing exchange rates. All assets and liabilities denominated in foreign
currencies are translated into U.S. dollar amounts at the current exchange rate
at the end of the period. Translation gains or losses resulting from changes in
the exchange rate during the reporting period and realized gains
39
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 2000
--------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES -- (CONT'D)
and losses on the settlement of foreign currency transactions are reported in
the results of operations for the current period. The Funds do not isolate that
portion of realized gains and losses on investments in equity securities which
are due to changes in the foreign exchange rate from that which are due to
changes in market prices of equity securities. The Funds isolate that portion of
realized gains and losses on investments in debt securities which are due to
changes in the foreign exchange rate from that which are due to changes in
market prices of debt securities.
The Funds may invest in securities of foreign countries and governments which
involve certain risks in addition to those inherent in domestic investments.
Such risks generally include, among others, currency risks (fluctuations in
currency exchange rates), information risk (key information may be inaccurate or
unavailable) and political risk (expropriation, nationalization or the
imposition of capital or currency controls or punitive taxes). Other risks of
investing in foreign securities include liquidity and valuation risks.
Each Fund's investments in securities of issuers located in less developed
countries considered to be "emerging markets" involve risks in addition to those
generally applicable to foreign securities. Focusing on emerging (less
developed) markets involves higher levels of risk, including increased currency,
information, liquidity, market, political and valuation risks. Deficiencies in
regulatory oversight, market infrastructure, shareholder protections and company
laws could expose the Funds to operational and other risks as well. Some
countries may have restrictions that could limit the Funds' access to attractive
opportunities. Additionally, emerging markets often face serious economic
problems (such as high external debt, inflation and unemployment) that could
subject the Funds to increased volatility or substantial declines in value.
Security transactions are accounted for on a trade date basis. Interest
income is recorded on the accrual basis. Dividends are recorded on the
ex-dividend date. Income, expenses (excluding class-specific expenses,
principally distribution and shareholder servicing fees) and realized/unrealized
gains/losses are allocated proportionately to each class of shares based upon
the relative net asset value of outstanding shares. Effective November 1, 1998,
class specific expenses no longer include transfer agent fees; accordingly these
fees will be allocated proportionately based upon the relative net asset value
of outstanding shares. The cost of investments sold is determined by use of the
specific identification method for both financial reporting and income tax
purposes.
40
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 2000
--------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES -- (CONT'D)
Each Fund may enter into forward currency contracts for the purchase or sale
of a specific foreign currency at a fixed price on a future date. Risks may
arise upon entering into these contracts from the potential inability of
counterparties to meet the terms of their contracts and from unanticipated
movements in the value of a foreign currency relative to the U.S. dollar. Each
Fund will enter into forward foreign currency contracts primarily for hedging
purposes. Forward foreign currency contracts are adjusted by the daily exchange
rate of the underlying currency and any gains or losses are recorded for
financial statement purposes as unrealized until the contract settlement date or
an offsetting position is entered into. At October 31, 2000, none of the Funds
had open forward foreign currency contracts.
Dividends from net investment income and distributions of net realized
capital gains, if any, are declared and paid at least annually for all Funds.
However, to the extent that a net realized capital gain can be reduced by a
capital loss carryover, such gain will not be distributed. Income and capital
gain distributions are determined in accordance with federal income tax
regulations which may differ from generally accepted accounting principles.
No provision is made for federal taxes as it is each Fund's intention to
continue to qualify for and elect the tax treatment applicable to regulated
investment companies under the Internal Revenue Code of 1986, as amended (the
"Code"), and make the requisite distributions to its shareholders which will be
sufficient to relieve it from federal income and excise taxes.
The Funds may be subject to taxes imposed by countries in which they invest,
with respect to their investments in issuers existing or operating in such
countries. Such taxes are generally based on income earned or repatriated and
capital gains realized on the sale of such investments. The Funds accrue such
taxes when the related income or capital gains are earned.
Costs incurred in connection with the organization and offering of shares
have been deferred and are being amortized over a period of five years and one
year, respectively, from the date each Fund commenced its operations.
Pursuant to an Exemptive Order issued by the Securities and Exchange
Commission, each Fund, along with other Funds advised by Credit Suisse Asset
Management, LLC, the Funds' investment adviser ("CSAM"), may transfer uninvested
cash balances to a pooled cash account, which is invested in repurchase
agreements secured by U.S. government securities. Securities pledged as
collateral for repurchase agreements are held by the Funds' custodian bank until
the agreements mature. Each agreement requires that the market value of the
collateral be sufficient to cover payments of interest
41
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 2000
--------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES -- (CONT'D)
and principal; however, in the event of default or bankruptcy by the other party
to the agreement, retention of the collateral may be subject to legal
proceedings. At October 31, 2000, the Funds had no investments in repurchase
agreements.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses during
the reporting period. Actual results could differ from these estimates.
The Funds have an arrangement with their transfer agent whereby interest
earned on uninvested cash balances is used to offset a portion of the transfer
agent expense.
For the year ended October 31, 2000, the Funds received credits or
reimbursements under this arrangement as follows:
FUND AMOUNT
---- --------
International Equity $246,504
Emerging Markets 17,326
Global Post-Venture Capital 24,780
2. INVESTMENT ADVISER, CO-ADMINISTRATORS AND DISTRIBUTOR
CSAM serves as each Fund's investment advisor. For its investment advisory
services, CSAM receives the following fees based on each Fund's average daily
net assets:
FUND ANNUAL RATE
------ ---------------------------------
International Equity 1.00% of average daily net assets
Emerging Markets 1.25% of average daily net assets
Global Post-Venture Capital 1.25% of average daily net assets
For the year ended October 31, 2000, investment advisory fees and waivers
were as follows:
GROSS NET
FUND ADVISORY FEE WAIVER ADVISORY FEE
---- ------------ --------- ------------
International Equity $12,091,912 $ 0 $12,091,912
Emerging Markets 1,124,537 (711,093) 413,444
Global Post-Venture Capital 1,719,601 (596,536) 1,123,065
Abbott Capital Management, LLC ("Abbott") serves as sub-investment adviser
for Global Post-Venture Capital's assets invested in U.S. or foreign private
limited partnerships or other investment funds ("Private Fund Investments").
Pursuant to the sub-advisory agreement between Abbott and
42
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 2000
--------------------------------------------------------------------------------
2. INVESTMENT ADVISER, CO-ADMINISTRATORS AND DISTRIBUTOR -- (CONT'D)
CSAM, Abbott is entitled to a quarterly fee from CSAM at the annual rate of
1.00% of the value of the Fund's Private Fund Investments as of the end of each
calendar quarter. No compensation is paid by Global Post-Venture Capital to
Abbott for its sub-investment advisory services.
Credit Suisse Asset Management Securities, Inc. ("CSAMSI"), an affiliate of
CSAM, and PFPC Inc. ("PFPC"), an indirect, wholly-owned subsidiary of PNC
Financial Services Group, serve as each Fund's co-administrators. For its
administrative services, CSAMSI currently receives a fee calculated at an annual
rate of .10% of each Fund's average daily net assets.
For the year ended October 31, 2000, administrative services fees earned by
CSAMSI were as follows:
FUND CO-ADMINISTRATION FEE
---- -----------------------
International Equity $1,209,191
Emerging Markets 57,162
Global Post-Venture Capital 137,568
For its administrative services through July 31, 2000, PFPC received a fee,
exclusive of out-of-pocket expenses, based on the following fee structure:
AVERAGE DAILY NET ASSETS ANNUAL RATE
---------------------- --------------------------------
First $250 million .12% of average daily net assets
Next $250 million .10% of average daily net assets
Next $250 million .08% of average daily net assets
Over $750 million .05% of average daily net assets
Effective August 1, 2000, for its administrative services, PFPC receives a
fee, exclusive of out-of-pocket expenses, based on the following fee structure:
AVERAGE DAILY NET ASSETS ANNUAL RATE
---------------------- --------------------------------
First $500 million .11% of average daily net assets
Next $1 billion .09% of average daily net assets
Over $1.5 billion .07% of average daily net assets
For the year ended October 31, 2000, administrative service fees earned and
voluntarily waived by PFPC (including out of pocket expenses) were as follows:
NET
FUND CO-ADMINISTRATION FEE WAIVER CO-ADMINISTRATION FEE
---- --------------------- ------ ---------------------
International Equity $1,021,051 $ 0 $1,021,051
Emerging Markets 120,058 0 120,058
Global Post-Venture Capital 169,988 (6,438) 163,550
43
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 2000
--------------------------------------------------------------------------------
2. INVESTMENT ADVISER, CO-ADMINISTRATORS AND DISTRIBUTOR -- (CONT'D)
In addition to serving as each Fund's co-administrator, CSAMSI served as the
distributor of each Fund's shares until January 1, 2000. On January 1, 2000,
Provident Distributors, Inc. ("PDI") replaced CSAMSI as distributor to the fund.
On August 1, 2000, CSAMSI replaced PDI as distributor to the Funds. No
compensation was payable by the Funds to PDI for distribution services. Pursuant
to a distribution plan adopted by each Fund pursuant to Rule 12b-1 under the
1940 Act, CSAMSI receives a fee for its distribution services. This fee is
calculated at an annual rate of .25% of the average daily net assets of the
Common Class shares of the Emerging Markets Fund and the Global Post-Venture
Capital Fund and at an annual rate of .50% of the Advisor Class shares of the
International Equity Fund, Emerging Markets Fund, and Global Post-Venture Fund.
CSAMSI may use this fee to compensate service organizations for shareholder
servicing and distribution services.
For the year ended October 31, 2000, shareholder servicing and distribution
fees paid to CSAMSI were as follows:
SHAREHOLDER SERVICING
DISTRIBUTION FEE
---------------------
FUND
----
International Equity
Advisor Class shares $1,198,464
==========
Emerging Markets
Common Class shares $ 216,842
Advisor Class shares 387
----------
$ 217,229
==========
Global Post-Venture Capital
Common Class shares $ 331,640
Advisor Class shares 24,560
----------
$ 356,200
==========
3. LINE OF CREDIT
The Funds, together with other funds advised by CSAM, have established a
$350 million committed and a $75 million uncommitted, unsecured, line of credit
facility ("Credit Facility") with Deutche Bank, AG as administrative agent,
State Street Bank and Trust Company as operations agents, Bank of Nova Scotia as
syndication agent and certain other lenders, for temporary or emergency purposes
primarily relating to unanticipated Fund share redemptions. Under the terms of
the Credit Facility, the Funds with access to the Credit Facility pay an
aggregate commitment fee at a rate of
44
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 2000
--------------------------------------------------------------------------------
3. LINE OF CREDIT -- (CONT'D)
.075% per annum on the entire amount of the Credit Facility which is allocated
among the participating Funds in such manner as is determined by the governing
Boards of the various funds. In addition, the participating Funds will pay
interest on borrowings at the Federal funds rate plus .50%. At October 31, 2000,
there were no loans outstanding for any of the Funds. During the year ending
October 31, 2000, the Funds had the following borrowings under the line of
credit agreement.
AVERAGE MAXIMUM
AVERAGE DAILY INTEREST DAILY LOAN
FUND LOAN BALANCE RATE % OUTSTANDING
---- ------------- --------- ------------
International Equity $5,264,770 6.490% $79,341,000
Emerging Markets 1,600,603 6.672 13,366,000
4. INVESTMENTS IN SECURITIES
For the year ended October 31, 2000, purchases and sales of investment
securities (excluding short-term investments) were as follows:
FUND PURCHASES SALES
---- -------------- ----------------
International Equity $3,100,579,260 $3,428,871,819
Emerging Markets 336,329,007 349,306,774
GlobalPost-Venture Capital 248,782,182 121,071,241
At October 31, 2000, the net unrealized appreciation from investments for
those securities having an excess of value over cost and net unrealized
depreciation from investments for those securities having an excess of cost over
value (based on cost for federal income tax purposes) was as follows:
UNREALIZED UNREALIZED NET UNREALIZED
FUND APPRECIATION DEPRECIATION APPRECIATION
---- ------------ ------------ --------------
International Equity $114,002,527 $(60,573,595) $53,428,932
Emerging Markets 4,689,657 (10,389,423) (5,699,766)
Global Post-Venture Capital 45,901,838 (17,930,258) 27,971,580
45
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 2000
--------------------------------------------------------------------------------
5. CAPITAL SHARE TRANSACTIONS
International Equity and Global Post-Venture Capital are authorized to issue
three billion full and fractional shares of capital stock, $.001 par value per
share, of which two billion shares of each Fund are classified as Advisor Class
shares and one billion shares are classified as Common Class shares. The
Emerging Markets Fund is authorized to issue three billion full and fractional
shares of capital stock, $.001 par value per share, of which one billion are
classified as Common shares, one billion are classified as Advisor shares, and
one billion are classified as Institutional shares. Transactions in classes of
each Fund were as follows:
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY FUND
------------------------------------------------------------------------------------------------------------------
COMMON CLASS SHARES ADVISOR CLASS SHARES
------------------------------------------------------------ ----------------------------------------------------
FOR THE YEAR ENDED FOR THE YEAR ENDED FOR THE YEAR ENDED FOR THE YEAR ENDED
OCTOBER 31, 2000 OCTOBER 31,1999 OCTOBER 31, 2000 OCTOBER 31,1999
----------------------------- ----------------------------- ------------------------- -------------------------
SHARES VALUE SHARES VALUE SHARES VALUE SHARES VALUE
------------ --------------- ------------ --------------- ---------- ------------- ---------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 123,478,077 $ 3,048,465,478 93,224,012 $ 1,778,780,264 3,464,050 $ 85,559,324 2,460,276 $ 46,326,070
Shares issued in
reinvestment
of dividends 256,151 6,250,071 0 0 18,613 449,139 0 0
Shares
repurchased (132,806,901) (3,318,259,113) (126,018,150) (2,378,091,713) (5,843,253) (142,407,373) (9,926,602) (181,663,467)
------------ --------------- ------------ --------------- ---------- ------------- ---------- -------------
Net decrease (9,072,673) $ (263,543,564) (32,794,138) $ (599,311,449) (2,360,590) $ (56,398,910) (7,466,326) $(135,337,397)
============ =============== ============ =============== ========== ============= ========== =============
</TABLE>
46
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 2000
--------------------------------------------------------------------------------
5. CAPITAL SHARE TRANSACTIONS -- (CONT'D)
<TABLE>
<CAPTION>
EMERGING MARKETS
----------------------------------------------------------------------------------------------------
COMMON CLASS SHARES ADVISOR CLASS SHARES
--------------------------------------------------------- ----------------------------------------
FOR THE YEAR ENDED FOR THE YEAR ENDED FOR THE YEAR ENDED FOR THE YEAR ENDED
OCTOBER 31, 2000 OCTOBER 31,1999 OCTOBER 31, 2000 OCTOBER 31, 1999
--------------------------- --------------------------- ------------------- ------------------
SHARES VALUE SHARES VALUE SHARES VALUE SHARES VALUE
----------- ------------- ----------- ------------- ------- --------- ------ --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 29,336,126 $ 341,084,971 20,639,374 $ 164,584,361 19,088 $ 239,930 3,005 $ 27,005
Shares exchanged
due to merger 119,041 1,697,652 0 0 0 0 0 0
Shares
repurchased (30,071,481) (355,261,716) (22,454,708) (180,042,232) (16,175) (201,146) (2,367) (16,254)
----------- ------------- ----------- ------------- ------- --------- ------ --------
Net increase/
(decrease) (616,314) $ (12,479,093) (1,815,334) $ (15,457,871) 2,913 $ 38,784 638 $ 10,751
=========== ============= =========== ============= ======= ========= ====== ========
</TABLE>
EMERGING MARKETS
------------------------------------
INSTITUTIONAL CLASS SHARES
------------------------------------
FOR THE YEAR ENDED
OCTOBER 31, 2000
------------------------------------
SHARES VALUE
-------- -----------
Shares sold 12,601 $ 163,666
Shares exchanged
due to merger 427,128 6,091,618
Shares
repurchased (126,209) (1,448,239)
-------- -----------
Net increase 313,520 $ 4,807,045
======== ===========
<TABLE>
<CAPTION>
GLOBAL POST-VENTURE CAPITAL
---------------------------------------------------------------------------------------------------
COMMON CLASS SHARES ADVISOR CLASS SHARES
--------------------------------------------------------- ---------------------------------------
FOR THE YEAR ENDED FOR THE YEAR ENDED FOR THE YEAR ENDED FOR THE YEAR ENDED
OCTOBER 31, 2000 OCTOBER 31, 1999 OCTOBER 31, 2000 OCTOBER 31, 1999
-------------------------- ------------------------ ------------------- -----------------
SHARES VALUE SHARES VALUE SHARES VALUE SHARES VALUE
---------- ------------- -------- ----------- ------- ----------- ------ -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shares sold 9,113,501 $ 273,832,742 251,394 $ 4,427,359 225,968 $ 6,738,875 2,700 $49,059
Shares exchanged
due to merger 2,547,701 85,282,770 0 0 157,637 5,226,453 0 0
Shares issued in
reinvestment
of distributions 67,715 1,654,263 971 11,069 92 2,232 0 4
Shares
repurchased (4,450,270) (133,359,377) (222,874) (3,738,096) (71,708) (2,130,693) (4) (71)
---------- ------------- -------- ----------- ------- ----------- ----- -------
Net increase 7,278,647 $ 227,410,398 29,491 $ 700,332 311,989 $ 9,836,867 2,696 $48,992
========== ============= ======== =========== ======= =========== ===== =======
</TABLE>
47
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 2000
--------------------------------------------------------------------------------
6. NET ASSETS
At October 31, 2000, capital contributions, accumulated undistributed net
investment income, accumulated net realized gain (loss) from investments and
foreign currency transactions and current period dividends and distributions
have been adjusted for current period permanent book/tax differences which arose
principally from differing book/tax treatments of foreign currency, equity swap
transactions and foreign taxes on capital gains. International Equity and
Emerging Markets reclassified $5,422,546 and ($1,695,094), respectively, from
accumulated net realized gain (loss) on investments and foreign currency
transactions to accumulated undistributed net investment income (loss). Global
Post-Venture reclassified $52,810 from accumulated net realized loss on
investments and foreign currency transactions and $1,073,160 from accumulated
net investment loss to paid in capital. Net investment income, net realized gain
(loss) on investments and net assets were not affected by these
reclassifications.
7. CAPITAL LOSS CARRYOVER
At October 31, 2000, capital loss carryovers available to offset possible
future capital gains of the Funds were as follows:
CAPITAL LOSS CARRYOVER EXPIRING IN
---------------------------------- TOTAL CAPITAL
FUND 2006 2008 LOSS CARRYOVER
---- ----------- --------- --------------
Emerging Markets $39,514,029 $ 0 $39,514,029
Global Post-Venture 0 3,266,167 3,266,167
Included in paid in capital are capital loss carryovers that were acquired as
a result of the merger between Emerging Markets II and Emerging Markets. There
may be limitations on their use in accordance with IRS regulations.
48
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 2000
--------------------------------------------------------------------------------
8. OTHER FINANCIAL HIGHLIGHTS
Emerging Markets offers three classes of shares, one class being referred to
as the Common Class, one class being referred to as the Advisor Class, and one
class being referred to as the Institutional Class. International Equity and
Global Post-Venture Capital currently offer the Common Class shares and Advisor
Class shares. Common, Advisor, and Institutional shares in each Fund represent
an equal pro rata interest in each Fund. The financial highlights for a Common
Class share of the Funds as well as the financial highlights for an
Institutional Class share of Emerging Markets are as follows:
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY
------------------------------------------------------
COMMON CLASS
------------------------------------------------------
FOR THE YEAR ENDED OCTOBER 31,
------------------------------------------------------
2000 1999 1998 1997 1996
-------- -------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
PER-SHARE DATA
Net asset value,
beginning of year $ 21.88 $ 16.64 $ 20.76 $ 20.69 $ 19.30
-------- -------- ---------- ---------- ----------
INVESTMENT ACTIVITIES:
Net investment income 0.03 0.13 0.12 1 0.04 0.22
Net gains (losses) on investments and
foreign currency related items (both
realized and unrealized) (1.68) 5.11 (1.38) 0.88 1.73
-------- -------- ---------- ---------- ----------
Total from investment activities (1.65) 5.24 (1.26) 0.92 1.95
-------- -------- ---------- ---------- ----------
LESS DIVIDENDS AND DISTRIBUTIONS:
Dividends from net investment income (0.16) 0.00 (0.14) (0.11) (0.56)
Distributions from net realized gains 0.00 0.00 (2.72) (0.74) 0.00
-------- -------- ---------- ---------- ----------
Total dividends and distributions (0.16) 0.00 (2.86) (0.85) (0.56)
-------- -------- ---------- ---------- ----------
NET ASSET VALUE, END OF YEAR $ 20.07 $ 21.88 $ 16.64 $ 20.76 $ 20.69
======== ======== ========== ========== ==========
Total return (7.68)% 31.49% (6.12)% 4.54% 10.35%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of year (000s omitted) $708,317 $970,531 $1,283,673 $2,312,042 $2,885,453
Ratio of expenses to average net assets2 1.42% 1.44% 1.36% 1.33% 1.38%
Ratio of net investment income to
average net assets .15% .59% .65% .56% .62%
Portfolio turnover rate 113.17% 116.35% 95.44% 61.80% 32.49%
</TABLE>
--------------------------------------------------------------------------------
1 Per share information is calculated using the average shares outstanding
method.
2 Interest earned on uninvested cash balances is used to offset portions of the
transfer agent expenses. These arrangements resulted in a reduction to the
Common Class shares' expenses by .02%, .01%, .00%, .01% and .01% for the
years ended October 31, 2000, 1999, 1998, 1997 and 1996, respectively. The
Common Class shares' operating expense ratios after reflecting these
arrangements were 1.40%, 1.43%, 1.36%, 1.32% and 1.37% for the years ended
October 31, 2000, 1999, 1998, 1997 and 1996, respectively.
49
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 2000
--------------------------------------------------------------------------------
8. OTHER FINANCIAL HIGHLIGHTS -- (CONT'D)
<TABLE>
<CAPTION>
EMERGING MARKETS
-------------------------------------------------
COMMON CLASS
-------------------------------------------------
FOR THE YEAR ENDED OCTOBER 31,
-------------------------------------------------
2000 1999 1998 1997 1996
------- ------- ------- -------- -------
<S> <C> <C> <C> <C> <C>
PER-SHARE DATA
Net asset value, beginning of year $ 9.27 $ 6.59 $ 10.82 $ 12.19 $ 11.28
------- ------- ------- -------- --------
INVESTMENT ACTIVITIES:
Net investment income 0.04 0.05 0.11 0.04 0.07
Net gains (losses) on investments and
foreign currency related items (both
realized and unrealized) (0.28) 2.63 (3.86) (1.34) 0.99
------- ------- ------- -------- --------
Total from investment activities (0.24) 2.68 (3.75) (1.30) 1.06
------- ------- ------- -------- --------
LESS DIVIDENDS AND DISTRIBUTIONS:
Dividends from net investment income 0.00 0.00 (0.04) (0.03) (0.08)
Distributions from net realized gains 0.00 0.00 (0.44) (0.04) (0.07)
------- ------- ------- -------- --------
Total dividends and distributions 0.00 0.00 (0.48) (0.07) (0.15)
------- ------- ------- -------- --------
NET ASSET VALUE, END OF YEAR $ 9.03 $ 9.27 $ 6.59 $ 10.82 $ 12.19
======= ======= ======= ======== ========
Total return (2.59)% 40.67% (35.95)% (10.71)% 9.46%
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of year (000s omitted) $60,482 $67,783 $60,189 $155,806 $218,421
Ratio of expenses to average net assets1 1.67% 1.66% 1.65% 1.66% 1.62%
Ratio of net investment income to average
net assets .44% .55% 1.00% .24% .31%
Decrease reflected in above operating expense
ratios due to waivers/reimbursements .79% .73% .63% .46% .77%
Portfolio turnover rate 232.47% 196.07% 125.59% 92.48% 61.84%
</TABLE>
--------------------------------------------------------------------------------
1 Interest earned on uninvested cash balances is used to offset portions of the
transfer agent expenses. These arrangements resulted in a reduction to the
Common Class shares' expenses by .02%, .01%, .00%, .01% and .01% for the
years ending October 31, 2000, 1999, 1998, 1997 and 1996, respectively. The
Common Class shares' operating expense ratios after reflecting these
arrangements were 1.65%, 1.65%, 1.65%, 1.65% and 1.61% for the years ended
October 31, 2000, 1999, 1998, 1997 and 1996, respectively.
50
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 2000
--------------------------------------------------------------------------------
8. OTHER FINANCIAL HIGHLIGHTS -- (CONT'D)
<TABLE>
<CAPTION>
GLOBAL POST-VENTURE CAPITAL
-----------------------------------------------
COMMON CLASS
-----------------------------------------------
FOR THE YEAR ENDED OCTOBER 31,
-----------------------------------------------
2000 1999 1998 1997 19961
-------- ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
PER-SHARE DATA
Net asset value, beginning of period $ 19.25 $10.53 $11.15 $ 9.86 $10.00
-------- ------ ------ ------ ------
INVESTMENT ACTIVITIES:
Net investment loss (0.13) (0.09) (0.02) (0.13) 0.00
Net gains (losses) on investments and foreign
currency related items (both realized
and unrealized) 11.35 8.84 (0.20) 1.42 (0.14)
-------- ------ ------ ------ ------
Total from investment activities 11.22 8.75 (0.22) 1.29 (0.14)
-------- ------ ------ ------ ------
LESS DIVIDENDS AND DISTRIBUTIONS:
Dividends from net investment income 0.00 0.00 (0.29) 0.00 0.00
Distributions from net realized gains (2.80) (0.03) (0.11) 0.00 0.00
-------- ------ ------ ------ ------
Total dividends and distributions (2.80) (0.03) (0.40) 0.00 0.00
-------- ------ ------ ------ ------
NET ASSET VALUE, END OF PERIOD $ 27.67 $19.25 $10.53 $11.15 $ 9.86
======== ====== ====== ====== ======
Total return 60.22% 83.36% (1.91)% 13.08% (1.40)%2
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s omitted) $211,822 $7,263 $3,661 $3,197 $3,007
Ratio of expenses to average net assets3 1.67% 1.66% 1.65% 1.66% 1.65%4
Ratio of net investment
loss to average net assets (.77)% (.61)% (1.01)% (.96)% (.20)%4
Decrease reflected in above operating expense
ratios due to waivers/reimbursements .44% 2.07% 3.90% 6.48% 21.71%4
Portfolio turnover rate 95.51% 239.88% 186.67% 207.25% 5.85%
</TABLE>
--------------------------------------------------------------------------------
1 For the period September 30, 1996 (inception date) through October 31, 1996.
2 Non annualized.
3 Interest earned on uninvested cash balances is used to offset portions of the
transfer agent expenses. These arrangements resulted in a reduction to
theCommon Class shares' expenses by .02%, .01%, .00%, .01% and .00% for the
years ending October 31, 2000, 1999, 1998, 1997 and the period ending October
31, 1996, respectively. The Common Class shares' expense ratios after
reflecting these arrangements were 1.65% for each of the years ended October
31, 2000, 1999, 1998, 1997 and the period ending October 31, 1996,
respectively.
4 Annualized.
51
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 2000
--------------------------------------------------------------------------------
8. OTHER FINANCIAL HIGHLIGHTS -- (CONT'D)
EMERGING MARKETS
------------------------
INSTITUTIONAL CLASS
------------------------
FEBRUARY 11, 2000
(INCEPTION DATE)
THROUGH OCTOBER 31, 2000
------------------------
PER-SHARE DATA
Net asset value, beginning of period $14.26
------
INVESTMENT ACTIVITIES:
Net investment income 0.07
Net losses on investments and foreign currency
related items (both realized and unrealized) (5.28)
------
Total from investment activities (5.21)
------
LESS DIVIDENDS AND DISTRIBUTIONS:
Dividends from net investment income 0.00
Distributions from net realized gains 0.00
------
Total dividends and distributions 0.00
------
NET ASSET VALUE, END OF PERIOD $ 9.05
======
Total return (36.54)%1
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000s omitted) $2,837
Ratio of expenses to average net assets2 1.37%
Ratio of net investment income to average net assets .70%
Decrease reflected in above operating expense ratios
due to waivers/reimbursements .77%
Portfolio turnover rate 232.47%
--------------------------------------------------------------------------------
1 Non annualized.
2 Interest earned on uninvested cash balances is used to offset portions of the
transfer agent expenses. These arrangements resulted in a reduction to the
Institutional Class shares' expenses by .02% for the period ended October 31,
2000. The Institutional Class shares' operating expense ratios after
reflecting these arrangements was 1.35% for the period ended October 31,
2000.
52
<PAGE>
WARBURG PINCUS FUNDS
REPORT OF INDEPENDENT ACCOUNTANTS
--------------------------------------------------------------------------------
To the Board of Directors and Shareholders of
Warburg, Pincus International Equity Fund, Inc.;
Warburg, Pincus Emerging Markets Fund, Inc.;
Warburg, Pincus Global Post-Venture Capital Fund, Inc.:
In our opinion, the accompanying statements of assets and liabilities, including
the schedules of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects the financial position of the Warburg, Pincus International
Equity Fund, Inc., Warburg, Pincus Emerging Markets Fund, Inc. and Warburg,
Pincus Global Post-Venture Capital Fund, Inc., (all funds collectively referred
to as the "Funds") at October 31, 2000, the results of each of their operations
for the year then ended, the changes in each of their net assets for each of the
two years in the period then ended and their financial highlights for each of
the years (or periods) presented, in conformity with accounting principles
generally accepted in the United States of America. These financial statements
and financial highlights (hereafter referred to as "financial statements") are
the responsibility of the Funds' 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 auditing standards
generally accepted in the United States of America, 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, 2000 by correspondence with the custodian and brokers, provide a reasonable
basis for our opinion.
PricewaterhouseCoopers LLP
Two Commerce Square
2001 Market Street
Philadelphia, Pennsylvania
December 15, 2000
53
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
SHAREHOLDER MEETING RESULTS (UNAUDITED)
--------------------------------------------------------------------------------
A special meeting of shareholders of Warburg, Pincus Emerging Markets II
Fund, Inc. (the "EM II Fund") was held on February 10, 2000. The following
matter was voted upon by the shareholders and the resulting votes are presented
below.
To approve the Agreement and Plan of Reorganization, dated December 1, 1999
and amended as of January 27, 2000, providing that (1) the EM II Fund would
transfer to Warburg, Pincus Emerging Markets Fund, Inc. (the "EM Fund") all or
substantially all of the EM II Fund's assets in exchange for shares of the EM
Fund and the assumption by the EM Fund of the EM II Fund's liabilities, (2) such
shares of the EM Fund would be distributed to the shareholders of the EM II Fund
in liquidation of the EM II Fund, and (3) the EM II Fund would be subsequently
terminated.
For 247,793.230 shares (52.61%)
Against 361.000 shares (0.07%)
Abstain 928.000 shares (0.20%)
The Agreement and Plan of Reorganization was subsequently implemented as of
the close of business on February 11, 2000.
A special meeting of shareholders of Warburg, Pincus Post-Venture Capital
Fund, Inc. (the "PVCFund") was held on February 24, 2000. The following matter
was voted upon by the shareholders and the resulting votes are presented below.
To approve the Agreement and Plan of Reorganization, dated December 1, 1999
and amended as of January 27, 2000, providing that (1) the PVC Fund would
transfer to Warburg, Pincus Global Post-Venture Capital Fund, Inc. (the "GPVC
Fund") all or substantially all of the PVC Fund's assets in exhange for shares
of the GPVC Fund and the assumption by the GPVC Fund of the PVC Fund's
liabilities, (2) such shares of the GPVC Fund would be distributed to the
shareholders of the PVC Fund in liquidation of the PVC Fund, and (3) the PVC
Fund would be subsequently terminated.
For 1,336,651.096 shares (50.4096%)
Against 124,528.924 shares (4.6964%)
Abstain 23,648.824 shares (0.8919%)
The Agreement and Plan of Reorganization was subsequently implemented as of
the close of business on February 25, 2000.
54
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
SHAREHOLDER MEETING RESULTS (CONT'D) (UNAUDITED)
--------------------------------------------------------------------------------
A special meeting of shareholders of the Emerging Markets Fund was held on
July 14, 2000. The following matter was voted upon by the shareholders and the
resulting votes are presented below.
To approve a Sub-Investment Advisory Agreement among the Fund, Credit Suisse
Asset Management, LLC and Credit Suisse Asset Management Limited.
For 3,610,721.950 shares (97.1%)
Against 43,367.288 shares (1.2%)
Abstain 64,453.665 shares (1.7%)
55
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
SHAREHOLDER TAX INFORMATION (UNAUDITED)
--------------------------------------------------------------------------------
Each Fund is required by Subchapter M of the Code to advise its shareholders
within 60 days of each Fund's fiscal year end as to the U.S. federal tax status
of dividends and distributions received by the Funds' shareholders in respect of
such fiscal year. During the fiscal year ended October 31, 2000, the following
dividends and distributions per share were paid by each of the Funds:
<TABLE>
<CAPTION>
ORDINARY LONG-TERM FOREIGN SOURCE FOREIGN TAXES
INCOME CAPITAL GAINS INCOME PAID OR WITHHELD
FUND PER SHARE PER SHARE PER SHARE PER SHARE
---- --------- ------------ -------------- ---------------
PAYMENT DATE 12/07/99 12/07/99
--------- ----------
<S> <C> <C> <C> <C>
International Equity
Common Class shares $ .1578 $ -- $.1112 $.0461
Advisor Class shares .0433 -- .0141 .0461
Global Post-Venture Capital
Common Class shares 2.2083 .5921 .0635 .0049
Advisor Class shares 2.2135 .5921 .0641 .0049
</TABLE>
Emerging Markets did not pay any ordinary income dividends or capital gain
distributions during the current fiscal year. Further, the above information was
provided to calendar year taxpayers on Form 1099-DIV mailed in January 2000.
Because the fiscal year of the Funds is not a calendar year, another
notification will be sent with respect to calendar year 2000. The second
notification, which will reflect the amount to be used by calendar year
taxpayers on their U.S. federal income tax returns, will be made in conjunction
with Form 1099-DIV and will be mailed in January 2001.
56
<PAGE>
--------------------------------------------------------------------------------
WARBURG PINCUS
ADVISOR FUNDS
CREDIT SUISSE
ASSET
MANAGEMENT
SECURITIES, INC.,
DISTRIBUTOR
--------------------------------------------------------------------------------
Credit Suisse Asset Management Securities, Inc., Distributor, is located at 466
Lexington Ave., New York, NY 10017-3147. Warburg Pincus Advisor Funds are
advised by Credit Suisse Asset Management, LLC.
[Warburg Pincus and Credt Suisse logos omitted]
ADISF-2-1000
