THE 59 WALL STREET PACIFIC BASIN EQUITY FUND
STATEMENT OF ASSETS AND LIABILITIES
October 31, 2000
ASSETS:
Investments in BBH Pacific Basin Equity Portfolio
("Portfolio"), at value .............................. $ 79,807,101
Receivable for capital stock sold ...................... 9,427,315
------------
Total Assets ........................................ $ 89,234,416
------------
LIABILITIES:
Payables for:
Capital stock redeemed .............................. 26,404
Shareholder servicing/eligible institution fees ..... 38,723
Administrative fee .................................. 19,361
Professional fees ................................... 16,850
Board of directors' fee ............................. 4,467
Accounting fees ..................................... 4,669
Accrued expenses and other liabilities .............. 12,761
------------
Total Liabilities ................................ 123,235
------------
NET ASSETS ............................................. $ 89,111,181
============
Net Assets Consist of:
Paid-in capital ..................................... $102,879,568
Distributions in excess of net investment income .... (657,368)
Accumulated net realized loss ....................... (20,775,266)
Net unrealized appreciation ......................... 7,664,247
------------
Net Assets ............................................. $ 89,111,181
============
NET ASSET VALUE AND OFFERING PRICE PER SHARE
($89,111,181 / 2,511,967 shares) .................... $ 35.47
============
The accompanying notes are an integral part of these financial statements.
<PAGE>
THE 59 WALL STREET PACIFIC BASIN EQUITY FUND
STATEMENT OF OPERATIONS
October 31, 2000
NET INVESTMENT INCOME:
Net Investment Loss Allocated from Portfolio:
Dividend and other income (net of foreign tax
expense $164,398) .................................. $ 780,730
Expenses ............................................. (977,698)
------------
Net Investment Loss Allocated from Portfolio ...... (196,968)
------------
Fund Expenses:
Shareholder servicing/eligible institution fees ...... 255,610
Administrative fee ................................... 127,805
Professional fees .................................... 47,692
Board of Directors' fees ............................. 16,700
Accounting fees ...................................... 8,002
Miscellaneous expenses ............................... 82,023
------------
Total Expenses .................................... 537,832
------------
Fees paid indirectly .............................. (14,806)
------------
Net expenses ...................................... 523,026
------------
Net Investment Loss ............................... (719,994)
------------
NET REALIZED AND UNREALIZED LOSS ALLOCATED FROM PORTFOLIO:
Net realized gain on investments and foreign
exchange transactions ................................. 9,473,188
Net change in unrealized appreciation on
investments and foreign currency translations ......... 12,558,860)
------------
Net Realized and Unrealized Loss Allocated
from Portfolio .................................. (3,085,672)
------------
Net Decrease in Net Assets Resulting from Operations .... $ (3,805,666)
============
The accompanying notes are an integral part of these financial statements.
<PAGE>
THE 59 WALL STREET PACIFIC BASIN EQUITY FUND
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
For the years ended October 31,
---------------------------------
2000 1999
------------- -------------
<S> <C> <C>
INCREASE IN NET ASSETS:
Operations:
Net investment loss ...................................................... $ (719,994) $ (303,253)
Net realized gain on investments and foreign exchange transactions ....... 9,473,188 11,428,050
Net change in unrealized appreciation on investments and foreign
currency translations ................................................... (12,558,860) 21,794,575
------------- -------------
Net increase (decrease) in net assets resulting from operations ......... (3,805,666) 32,919,372
------------- -------------
Dividends in excess of net investment income ............................... (4,448,893) --
------------- -------------
Capital stock transactions (Note 4):
Net proceeds from sales of capital stock ................................ 147,056,047 115,186,849
Net asset value of capital stock issued to shareholders in
reinvestment of distributions ......................................... 2,554,345 --
Net cost of capital stock redeemed ...................................... (132,655,719) (100,325,530)
------------- -------------
Net increase in net assets resulting from capital stock
transactions ......................................................... 16,954,673 14,861,319
------------- -------------
Total increase in net assets ......................................... 8,700,114 47,780,691
NET ASSETS:
Beginning of year .......................................................... 80,411,067 32,630,376
------------- -------------
End of year (including distributions in excess of net investment
income of $657,368 and undistributed net investment
income of $675,496, respectively) ..................................... $ 89,111,181 $ 80,411,067
============= =============
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
THE 59 WALL STREET PACIFIC BASIN FUND
FINANCIAL HIGHLIGHTS
Selected per share data and ratios for a share outstanding
throughout each period
<TABLE>
<CAPTION>
For the years ended October 31,
---------------------------------------------------------------
2000 1999 1998 1997 1996
------- ------- ------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period .............. $ 38.77 $ 20.31 $ 24.52 $ 30.19 $ 29.88
Income from investment operations:
Net investment income (loss) ................... (0.31)(1) (0.17)(1) (0.20) 0.00(1,2) 0.05(1)
Net realized and unrealized gain (loss) ........ (0.89) 18.63 (2.39) (4.69) 1.62
Less dividends and distributions:
From net investment income ..................... -- -- (0.52) (0.00)(2) (0.86)
In excess of net investment income ............. (2.10) -- (1.10) (0.25) (0.50)
From net realized gains ........................ -- -- -- (0.28) --
In excess of net realized gains ................ -- -- -- (0.45) --
------- ------- ------- -------- --------
Net asset value, end of period .................... $ 35.47 $ 38.77 $ 20.31 $ 24.52 $ 30.19
======= ======= ======= ======== ========
Total return ...................................... (3.81)% 90.89% (10.78)% (16.03)% 5.65%
Ratios/Supplemental data:
Net assets, end of period (000's omitted) ...... $89,111 $80,411 $32,630 $102,306 $150,685
Expenses as a percentage of average net assets:
Expenses paid by Fund 1.47%(6) 1.39% 1.44% 1.19% 1.13%
Expenses paid by commissions(3) .............. -- -- -- 0.01% 0.01%
Expense offset arrangement ................... 0.01% --(4) 0.18% 0.06% 0.16%
------- ------- ------- -------- --------
Total expenses ............................ 1.48% 1.39% 1.62% 1.26% 1.30%
Ratio of net investment income (loss) to average
net assets ................................... (0.70)% (0.58)% (0.73)% 0.00% 0.16%
Portfolio turnover rate ........................ 76%(5) 97% 91% 63% 58%
</TABLE>
----------
(1) Calculated using average shares outstanding for the year.
(2) Less than $0.01 per share.
(3) A portion of the Fund's securities transactions are directed to certain
unaffiliated brokers which in turn use a portion of the commissions they
receive from the Fund to pay other unaffiliated service providers on
behalf of the Fund for services provided for which the Fund would
otherwise be obligated to pay.
(4) Less than 0.01%.
(5) Portfolio turnover rate is that of the Portfolio in which the Fund
invests.
(6) Includes the Fund's share of expenses paid by the Portfolio and expense
offset arrangement.
The accompanying notes are an integral part of these financial statements.
<PAGE>
THE 59 WALL STREET PACIFIC BASIN EQUITY FUND
NOTES TO FINANCIAL STATEMENTS
1. Organization and Significant Accounting Policies. The 59 Wall Street
Pacific Basin Equity Fund (the "Fund") is a separate non-diversified series of
The 59 Wall Street Fund, Inc. (the "Corporation") which is registered under the
Investment Company Act of 1940, as amended. The Corporation is an open-ended
management investment company organized under the laws of the State of Maryland
on July 19, 1990. The Fund commenced operations on November 1, 1990.
The Fund invests all of its investable assets in the BBH Pacific Basin
Equity Portfolio (the "Portfolio"), a diversified, open-end management
investment company having the same investment objectives as the Fund. The value
of such investment reflects the Fund's proportionate interest in the net assets
of the Portfolio (approximately 75% at October 31, 2000). The performance of the
Fund is directly affected by the performance of the Portfolio. The financial
statements of the Portfolio, including the portfolio of investments, are
included elsewhere in this report and should be read in connection with the
Fund's financial statements.
The Fund's financial statements are prepared in accordance with accounting
principles generally accepted in the United States of America which require
management to make certain estimates and assumptions at the date of the
financial statements and are based, in part, on the following accounting
policies. Actual results could differ from those estimates.
A. Valuation of Investments. The Fund records its investment in the
Portfolio at fair value. Valuation of investments held by the Portfolio is
discussed in Note 1 of the Portfolio's Notes to Financial Statements which
are included elsewhere in this report.
B. Investment Income and Expenses. The Fund records its share of
income, expenses, realized and unrealized gains and losses each day. In
addition, the Fund accrues its own expenses.
C. Federal Income Taxes. It is the Corporation's policy to comply
with the requirements of the Internal Revenue Code applicable to regulate
investment companies and to distribute all of its taxable income to its
shareholders. Accordingly, no federal income tax provision is required.
The Fund files a tax return annually using tax accounting methods required
under provisions of the Internal Revenue Code which may differ from
accounting principles generally accepted in the United States of America,
the basis which these financial statements are prepared. Accordingly, the
amounts of net investment income and net realized gain reported on these
financial statements may differ from that reported on the Fund's tax
return due to certain book-to-tax differences such as losses deferred due
to "wash sale" transactions, utilization of capital loss carryforwards and
the recognition of unrealized gains or losses on open forward foreign
currency exchange contracts and passive foreign investment companies at
year-end. These differences may result in temporary over-distributions for
financial statement purposes and are classified as distributions in excess
of accumulated net realized gains or net investment income. These
distributions do not constitute a return of capital. Permanent differences
are reclassified on the statement of assets and liabilities based upon
their tax classification. As such, the character of distributions to
shareholders reported in the Financial Highlights table may differ from
that reported to shareholders on Form 1099-DIV.
D. Dividends and Distributions to Shareholders. Dividends and
distributions to shareholders are recorded on the ex-dividend date.
2. Transactions with Affiliates.
Administrative Fee. The Corporation has an administrative agreement with
Brown Brothers Harriman (the "Administrator") for which the Administrator
receives a fee from the Fund calculated daily and paid monthly at an annual rate
equivalent to 0.125% of the Fund's average daily net assets. The Administrator
has a sub administration services agreement with 59 Wall Street Administrators,
Inc. for which 59 Wall Street Administrators, Inc. receives such compensation as
is from time to time agreed upon, but not in excess of the amount paid to the
Administrator. For the year ended October 31, 2000, the Fund incurred $127,805
for administrative services.
<PAGE>
THE 59 WALL STREET PACIFIC BASIN EQUITY FUND
NOTES TO FINANCIAL STATEMENTS (continued)
Shareholder Servicing/Eligible Institution Agreement. The Corporation has
a shareholder servicing agreement and an eligible institution agreement with
Brown Brothers Harriman for which Brown Brothers Harriman receives a fee from
the Fund calculated daily and paid monthly at an annual rate equivalent to 0.25%
of the Fund's average daily net assets. For the year ended October 31, 2000, the
Fund incurred $255,610 for such services.
Accounting Fee. The Corporation has an accounting agreement with Brown
Brothers Harriman (the "Accountant") for which the Accountant receives a fee
calculated and paid monthly. For the year ended October 31, 2000, the Fund
incurred $8,002 for accounting services.
Board of Directors' Fee. Each Director receives an annual fee as well as
reimbursement for reasonable out-of-pocket expenses from the Fund. For the year
ended October 31, 2000, the Fund incurred $16,700 for these fees.
3. Investment Transactions. Investment transactions of the portfolio are
discussed in Note 3 of the Portfolio's Notes to Financial Statements. Custody
fees for the Fund were reduced by $14,806 as a result of the Fund directing a
portion of its portfolio transactions to certain unaffiliated brokers.
4. Capital Stock. The Corporation is permitted to issue 2,500,000,000
shares of capital stock, par value $.001 per share, of which 25,000,000 shares
have been classified as shares of the Fund. Transactions in shares of capital
stock were as follows:
For the years
ended October 31,
--------------------------
2000 1999
---------- ----------
Capital stock sold ............................. 3,524,509 3,748,466
Capital Stock issued in connection with
reinvestment of dividends and
distributions ................................ 62,059 --
Capital stock repurchased ...................... (3,148,469) (3,281,480)
---------- ----------
Net Increase ................................... 438,099 466,986
========== ==========
5. Federal Income Tax Status. At October 31, 2000, the 59 Wall Street
Pacific Basin Equity Fund for Federal income taxes purposes, had a capital loss
carryforward of $20,486,128 which may be applied against any net taxable
realized gain of each succeeding year until the earlier of its utilization or
expiration on October 31, 2006.
<PAGE>
INDEPENDENT AUDITORS' REPORT
Board of Directors and Shareholders
The 59 Wall Street Pacific Basin Equity Fund (a series of The 59 Wall Street
Fund, Inc.):
We have audited the accompanying statement of assets and liabilities of
The 59 Wall Street Pacific Basin Equity Fund (a series of The 59 Wall Street
Fund, Inc.) as of October 31, 2000, the related statement of operations for the
year then ended, the statement of changes in net assets for the years ended
October 31, 2000 and 1999, and the financial highlights for each of the years in
the five-year period ended October 31, 2000. These financial statements and
financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of The 59 Wall Street
Pacific Basin Equity Fund at October 31, 2000 and the results of its operations,
the changes in its net assets, and its financial highlights for the respective
stated periods in conformity with accounting principles generally accepted in
the United States of America.
DELOITTE & TOUCHE LLP
Boston, Massachusetts
December 22, 2000
<PAGE>
MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE
The following investment management strategies and techniques have
materially affected the Fund's performance for the fiscal year ended October 31,
2000.
Pacific Basin Equity Fund
The twelve month period ending October 31, 2000 was a difficult one for
Pacific Basin Equity markets. As measured by MSCI in U.S. dollars, the Pacific
Basin Index declined 10.5%. No market was immune, but Hong Kong, with its
exposure to the improving economic environment in China, declined least (-1.3%).
The poor performance of markets in the region can be attributed to two primary
factors: the dramatic global sell-off of telecom and technology shares,
particularly semiconductor-related, after recording new highs in March, and
on-going concerns in Japan about the country's economic prospects. Japan has
recorded three consecutive quarters of positive growth, but virtually all of the
growth has been generated by government spending or business investment. The
all-important consumer has not been a meaningful contributor, thereby placing
recovery at risk. Evidence does suggest that the consumer sector has, at the
margin, begun to improve, but not enough to produce economic growth in Japan of
more than a very modest 1%-2% in the next twelve months.
The 59 Wall Street Pacific Basin Equity Fund outperformed its benchmark
over this difficult period, declining less than 4% in the year ending October
31, 2000. Much of the outperformance was generated by the Fund's overweighted
exposure to technology and telecom stocks early in the year when these sectors
were roaring ahead, followed by a timely trimming of exposure to these stocks as
the year progressed.
With much of the Pacific Basin's economic prospects dependent on exports,
the expectation of a trough in U.S. economic activity in Q4 2000, followed by a
return to a more sustainable 3%-4% pace in 2001, should improve investor
sentiment throughout the region. Likewise, further restructuring of Japanese
corporate management practices, and enactment of long anticipated economic and
political reform as the new year progresses, would restore investor confidence
in the Japanese market. In the meantime, the Fund continues to invest in larger
capitalization, globally competitive companies with leading market positions and
superior growth prospects.
Pacific Basin Equity Fund Growth of $10,000
--------------------------------------------------
Total Return
--------------------------------------------------
One Year Five Years Inception
Ended Ended 10/31/00 to 10/31/00
10/31/00 (Annualized) (Annualized)
--------------------------------------------------
(3.81)% 7.78% 8.55%
--------------------------------------------------
[The following information was depicted as a line chart in the printed material]
Pacific Basin
Date Equity Fund* MSCI-Pacific
---- ------------ ------------
10/31/1990 .............................. $10,000 $10,000
(inception)
10/31/1991 .............................. 11,068 10,698
10/31/1992 .............................. 11,254 8,360
10/31/1993 .............................. 16,883 12,436
10/31/1994 .............................. 17,471 13,562
10/31/1995 .............................. 15,616 12,040
10/31/1996 .............................. 16,497 12,438
10/31/1997 .............................. 13,853 9,989
10/31/1998 .............................. 12,359 8,599
10/31/1999 .............................. 23,615 13,032
10/31/2000 .............................. 22,714 11,656
* net of fees and expenses
Past performance is not predictive of future performance.
<PAGE>
BBH PACIFIC BASIN EQUITY PORTFOLIO
PORTFOLIO OF INVESTMENTS
October 31, 2000
Shares Value
------ -----
COMMON STOCKS (93.7%)
AUSTRALIA (4.8%)
BANKING
99,800 National Australia Bank, Ltd. ..................... $ 1,386,400
------------
CONSUMER GOODS
400,200 Coca-Cola Amatil, Ltd. ............................ 814,631
------------
SERVICES
155,500 Lend Lease Corp. .................................. 1,820,428
------------
TELECOMMUNICATIONS
806,500 Cable and Wireless Optus* ......................... 1,708,149
------------
TOTAL AUSTRALIA ................................... 5,729,608
------------
HONG KONG (6.0%)
CONSUMER NON-DURABLES
136,390 Asia Foods, Ltd.#* ................................ 220,952
------------
MULTI-INDUSTRY
141,440 Hutchinson Whampoa, Ltd. .......................... 1,759,159
952,800 Li & Fung, Ltd. ................................... 1,771,458
------------
3,530,617
------------
TELECOMMUNICATIONS
527,300 China Telecom* .................................... 3,380,562
------------
TOTAL HONG KONG ................................... 7,132,131
------------
INDIA (3.0%)
FINANCE
556,347 Industrial Credit & Investment
Corp. of India, Ltd. ............................ 880,630
------------
MATERIALS
244,000 Indo Gulf Fertilisers and
Chemicals Corp., Ltd. GDR+ ...................... 225,700
144,142 Reliance Industries, Ltd. ......................... 932,792
6,595 Reliance Industries, Ltd. GDR ..................... 42,678
------------
1,201,170
------------
TELECOMMUNICATIONS
300,000 MaHanagar Telephone ............................... 902,978
------------
SERVICE
100,000 Zee Telefilms, Ltd. ............................... 616,288
------------
TOTAL INDIA ....................................... 3,601,066
------------
JAPAN (66.9%)
BANKING
887,000 Asahi Bank, Ltd. .................................. 3,494,846
421 Mizuho Holdings, Inc.* ............................ 3,236,533
243,000 Sumitomo Trust and Banking Co., Ltd. .............. 2,950,245
------------
9,681,624
------------
CAPITAL GOODS/DURABLES
83,000 Fujitsu, Ltd. ..................................... 1,478,462
51,000 Matsushita Electric
Industrial Co., Ltd. ............................ 1,481,376
148,000 Matsushita Electric Works ......................... 1,742,612
------------
4,702,450
------------
CHEMICALS
42,000 Shin-Etsu Chemical Co. ............................ 1,724,103
------------
CONSUMER DISCRETIONARY
160,000 Toppan Printing Co. ............................... 1,413,295
------------
CONSUMER ELECTRONICS
39,100 Sony Corp. ........................................ 3,124,131
------------
CONSUMER GOODS
134,000 Kirin Brewery Co., Ltd. ........................... 1,397,279
360,000 Nissan Motor Co. .................................. 2,470,701
------------
3,867,980
------------
CONSUMER NON-DURABLES
44,000 Kao Corp. ......................................... 1,318,367
17,300 Nintendo Co., Ltd. ................................ 2,861,273
------------
4,179,640
------------
ELECTRIC COMPONENTS
16,300 Matsushita Communications
Industrial Co., Ltd. ............................ 2,135,795
11,100 Rohm Co., Ltd. .................................... 2,798,012
------------
4,933,807
------------
FINANCE
24,100 Acom Co., Ltd. .................................... 1,949,906
135,000 Nomura Securities Co., Ltd. ....................... 2,863,655
24,280 Orix Corp. ........................................ 2,547,359
------------
7,360,920
------------
MACHINERY/EQUIPMENT
405,000 Mitsubishi Heavy Industries ....................... 1,573,464
------------
<PAGE>
BBH PACIFIC BASIN EQUITY PORTFOLIO
PORTFOLIO OF INVESTMENTS
October 31, 2000 (continued)
Shares Value
------ -----
JAPAN (continued)
MATERIALS
275,000 Kinden Corp. ...................................... $ 1,804,187
488,000 Mitsubishi Materials Corp. ........................ 1,435,360
289,000 Sumitomo Chemical Co. ............................. 1,424,676
482,000 Sumitomo Metal & Mining Co. ....................... 2,486,517
------------
7,150,740
------------
MEDIA
193 Fuji Television Network ........................... 2,122,142
------------
MULTI-INDUSTRY
20,200 Softbank Corp. .................................... 1,212,352
224,000 Sumitomo Corp. .................................... 1,970,404
------------
3,182,756
------------
PHARMACEUTICALS
61,000 Kissei Pharmaceutical Co., Ltd. ................... 1,117,323
57,000 Santen Pharmaceutical Co., Ltd. ................... 1,125,533
48,000 Yamanouchi Pharmaceutical Co., Ltd. ............... 2,172,722
------------
4,415,578
------------
PRECISION INSTRUMENTS
28,900 Hoya Corp. ........................................ 2,388,583
------------
REAL ESTATE
25,800 Oriental Land Co., Ltd. ........................... 1,560,269
------------
RETAIL
48,000 Ito-Yokado Co., Ltd. .............................. 2,168,323
------------
SERVICES
85,000 Credit Saison Co., Ltd. ........................... 1,799,148
1,273,000 Kawasaki Kisen Kaisha, Ltd. ....................... 2,286,233
265,000 Toei Co. .......................................... 1,070,830
324,000 Tokyu Corp. ....................................... 1,674,403
------------
6,830,614
------------
TELECOMMUNICATIONS
360 Nippon Telegraph & Telephone ...................... 3,275,576
122 NTT Docomo, Inc. .................................. 3,007,101
------------
6,282,677
------------
TRANSPORTATION
221,000 Nippon Express Co. ................................ 1,326,385
------------
TOTAL JAPAN ....................................... 79,989,481
------------
SINGAPORE (8.3%)
BANKING
189,952 DBS Group Holdings, Ltd. .......................... 2,238,801
------------
ELECTRIC COMPONENTS
34,600 Chartered Semiconductors ADR* ..................... 1,608,900
------------
SERVICES
185,200 Singapore Airlines ................................ 1,855,902
------------
TELECOMMUNICATIONS
340,100 Datacraft Asia, Ltd.* ............................. 2,329,685
1,187,000 Singapore Telecom ................................. 1,966,731
------------
4,296,416
------------
TOTAL SINGAPORE ................................... 10,000,019
------------
SOUTH KOREA (4.4%)
ELECTRIC COMPONENTS
25,935 Samsung Electronics Co., GDR ...................... 3,249,000
------------
FINANCE
90,000 Samsung Securities ................................ 1,629,890
------------
TECHNOLOGY
59,370 Hyundai Electrical Industries* .................... 364,832
------------
TOTAL SOUTH KOREA ................................. 5,243,722
------------
TAIWAN (0.3%)
ELECTRIC COMPONENTS
55,000 Powerchip Semiconductor, Ord.* .................... 365,750
------------
TOTAL TAIWAN ...................................... 365,750
------------
The accompanying notes are an integral part of these financial statements.
<PAGE>
BBH PACIFIC BASIN EQUITY PORTFOLIO
PORTFOLIO OF INVESTMENTS
October 31, 2000 (continued)
TOTAL INVESTMENTS (identified cost $108,383,453) (a) .. 93.7% $112,061,777
CASH AND OTHER ASSETS LESS LIABILITIES ................ 6.3 7,496,947
----- ------------
NET ASSETS ............................................ 100.0% $119,558,724
===== ============
----------
* Non-income producing security.
+ Rule 144A security.
# Restricted security -- Total market value of the restricted security owned
at October 31, 2000 was $220,952 or 0.2% of net assets. Acquired on
December 13, 1999 at a cost of $220,952.
(a) The aggregate cost for federal income tax purposes is $109,614,934, the
aggregate gross unrealized appreciation is $15,131,407, and the aggregate
gross unrealized depreciation is $12,684,564, resulting in net unrealized
appreciation of $2,446,843.
The accompanying notes are an integral part of these financial statements.
<PAGE>
BBH PACIFIC BASIN EQUITY PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
October 31, 2000
ASSETS:
Investments in securities, at value (identified
cost $108,383,453) ................................... $112,061,777
Receivables for:
Investments sold ..................................... 1,916,007
Contributions ........................................ 10,286,982
Dividends ............................................ 177,430
------------
Total Assets ..................................... 124,442,196
------------
LIABILITIES:
Due to bank (including $58,514 in foreign currency) ..... 3,824,683
Payables for:
Withdrawals .......................................... 758,697
Investment advisory fee .............................. 137,201
Custody fee .......................................... 112,936
Professional fees .................................... 36,500
Administrative fee ................................... 7,388
Board of Trustees' fee ............................... 6,067
------------
Total Liabilities ................................ 4,883,472
------------
NET ASSETS .................................................... $119,558,724
============
The accompanying notes are an integral part of these financial statements.
<PAGE>
BBH PACIFIC BASIN EQUITY PORTFOLIO
STATEMENT OF OPERATIONS
October 31, 2000
NET INVESTMENT LOSS:
Income:
Dividends and other income (net of foreign
withholding taxes of $212,080) ..................... $ 1,082,504
------------
Expenses:
Investment advisory fee .............................. 905,250
Custody fee .......................................... 317,706
Administrative fee ................................... 48,744
Professional fees .................................... 40,112
Board of Trustees' fee ............................... 19,061
Miscellaneous expenses ............................... 14,346
------------
Total Expenses ................................... 1,345,219
Fees paid indirectly ............................. (16,616)
------------
Net Expenses ..................................... 1,328,603
------------
Net Investment Loss ..................................... (246,099)
============
NET REALIZED AND UNREALIZED GAIN:
Net realized gain on investments and foreign
exchange transactions ................................. 9,779,607
Net change in unrealized appreciation on
investments and foreign currency translations ......... 3,670,320
------------
Net Realized and Unrealized Gain ................. 13,449,927
------------
Net Increase in Net Assets Resulting from Operations .... $ 13,203,828
============
The accompanying notes are an integral part of these financial statements.
<PAGE>
BBH PACIFIC BASIN EQUITY PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
For the
year ended
October 31, 2000
----------------
INCREASE IN NET ASSETS:
Operations:
Net investment loss ................................ $ (246,099)
Net realized gain on investments and
foreign exchange transactions .................... 9,779,607
Net change in unrealized appreciation on
investments and foreigncurrency translations ..... 3,670,320
-------------
Net increase in net assets resulting from
operations ..................................... 13,203,828
-------------
Capital transactions:
Proceeds from contributions ........................ 276,934,912
Fair value of withdrawals .......................... (170,580,016)
-------------
Net increase in net assets resulting from
capital transactions ........................... 106,354,896
-------------
Total increase in net assets ................... 119,558,724
NET ASSETS:
Beginning of year ..................................... --
-------------
End of year ........................................... $ 119,558,724
=============
The accompanying notes are an integral part of these financial statements.
<PAGE>
BBH PACIFIC BASIN EQUITY PORTFOLIO
FINANCIAL HIGHLIGHTS
For the
year ended
October 31, 2000
----------------
Total Return ................................................ (3.40)%
Ratios/Supplemental Data:
Net assets, end of period (000's omitted) ................... $ 119,559
Expenses as a percentage of average net assets:
Expenses paid by Portfolio .............................. 0.95%
Expense offset arrangement .............................. 0.01%
-----------
Total Expenses ...................................... 0.96%
Ratio of net investment loss to average net assets .......... (0.18)%
Portfolio turnover rate ..................................... 76%
The accompanying notes are an integral part of these financial statements.
<PAGE>
BBH PACIFIC BASIN EQUITY PORTFOLIO
NOTES TO FINANCIAL STATEMENTS
1. Organization and Significant Accounting Policies. BBH Pacific Basin
Equity Portfolio (the "Portfolio") is registered under the Investment Company
Act of 1940, as amended, as an open-ended management investment company which
was organized as a trust under the laws of the State of New York on June 15,
1993. The Portfolio commenced operations on November 1, 1999. The Declaration of
Trust permits the Trustees to create an unlimited number of beneficial interests
in the Portfolio.
The Portfolio's financial statements are prepared in accordance with
accounting principles generally accepted in the United States of America which
require management to make certain estimates and assumptions at the date of the
financial statements and are based, in part, on the following accounting
policies. Actual results could differ from those estimates.
A. Valuation of Investments. (1) The value of investments listed on
either a domestic or foreign securities exchange is based on the last
price on that exchange prior to the time when assets are valued, or in the
absence of recorded sales, at the average of readily available closing bid
and asked prices on such exchange; (2) unlisted securities are valued at
the average of the quoted bid and asked prices in the over-the-counter
market; (3) securities or other assets for which market quotations are not
readily available are valued at fair value in accordance with procedures
established by and under the general supervision and responsibility of the
Portfolio's Trustees. Such procedures include the use of independent
pricing services, which use prices based upon yields or prices of
securities of comparable quality, coupon, maturity and type; indications
as to the value from dealers; and general market conditions; (4) all
assets and liabilities initially expressed in foreign currencies will be
converted into U.S. dollars at the prevailing rates of exchange available
at the time of valuation; and (5) trading in securities on most foreign
exchanges and over-the-counter markets is normally completed before the
close of the New York Stock Exchange and may also take place on days on
which the New York Stock Exchange is closed. If events materially
affecting the value of foreign securities occur between the time the
exchange on which they are traded closes and the time the Portfolio's net
assets are calculated, such securities will be valued at fair value in
accordance with procedures established by and under the general
supervision of the Portfolio's Trustee.
B. Foreign Currency Translations. The accounting records of the
Portfolio are maintained in U.S. dollars. Foreign currency amounts are
translated into U.S. dollars at the current rate of exchange of such
currency against the U.S. dollar to determine the value of investments,
assets and liabilities. Purchases and sales of securities, and income and
expenses are translated at the prevailing rate of exchange on the
respective dates of such transactions. Upon the purchase or sale of a
security denominated in foreign currency, the Portfolio may enter into
forward foreign currency exchange contracts for the purchase or sale, for
a fixed amount of U.S. dollars, of the amount of foreign currency involved
in the underlying security transactions. The Portfolio isolates that
portion of realized gain or loss on investments resulting from changes in
foreign exchange rates on investments from the fluctuations arising from
the changes in market prices of such investments. Reported net realized
and unrealized gains and losses arise from the sales of portfolio
securities, sales of foreign currencies, currency gains or losses realized
between the trade and settlement dates on securities transactions, and the
difference between the amounts of dividends, interest and foreign
withholding taxes recorded on the Portfolio's books and the U.S. dollar
equivalents of the amounts actually received or paid. Net unrealized
appreciation or depreciation on foreign currency translations arise from
changes in the value of the assets and liabilities, excluding investments
in securities, at year end, arising from changes in the exchange rate.
<PAGE>
BBH PACIFIC BASIN EQUITY PORTFOLIO
NOTES TO FINANCIAL STATEMENTS (continued)
C. Forward Foreign Currency Exchange Contracts. The Portfolio may
enter into forward foreign currency exchange contracts ("contracts") in
connection with planned purchases or sales of securities, to hedge the
U.S. dollar value of portfolio securities denominated in a particular
currency, or to increase or shift its exposure to a currency other than
U.S. dollars. The Portfolio has no specific limitation on the percentage
of assets which may be committed to these types of contracts. The
Portfolio could be exposed to risks if the counterparties to the contracts
are unable to meet the terms of their contracts or if the value of the
foreign currency changes unfavorably. The U.S. dollar values of foreign
currency underlying all contractual commitments held by the Portfolio are
determined using forward currency exchange rates supplied by a quotation
service.
D. Accounting for Investments. Security transactions are accounted
for on the trade date. Realized gains and losses on security transactions
are determined on the identified cost method. Dividend income and other
distributions from portfolio securities are recorded on the ex-dividend
date. Dividend income is recorded net of foreign taxes withheld where
recovery of such taxes is not assured. Interest income is accrued daily.
E. Federal Income Taxes. The Portfolio will be treated as a
partnership for Federal income tax purposes. As such, each investor in the
Portfolio will be subject to taxation on its share of the Portfolio's
ordinary income and capital gains. It is intended that the Portfolio's
assets will be managed in such a way that an investor in the Portfolio
will be able to comply with the provisions of the Internal Revenue Code
applicable to regulated investment companies. Accordingly, no provision
for Federal income taxes is necessary.
2. Transactions with Affiliates.
Investment Advisory Fee. The Portfolio has an investment advisory
agreement with Brown Brothers Harriman (the "Adviser") for which it pays the
Adviser a fee calculated daily and paid monthly at an annual rate equivalent to
0.65% of each Portfolio's average daily net assets. For the year ended October
31, 2000, the Portfolio incurred $905,250 for advisory services.
Administrative Fee. The Portfolio has an administrative agreement with
Brown Brothers Harriman Trust Company, LLC (the "Administrator") for which it
pays the Administrator a fee calculated daily and paid monthly at an annual rate
equivalent to 0.035% of the Portfolio's average daily net assets. The
Administrator has a sub administration services agreement with Signature
Financial Group for which Signature Financial Group receives such compensation
as is from time to time agreed upon, but not in excess of the amount paid to the
Administrator. For the year year ended October 31, 2000, the Portfolio incurred
$48,744 for administrative services.
Custody Agreement. The Portfolio has a custody agreement with Brown
Brothers Harriman (the "Custodian") for which Brown Brothers Harriman receives a
fee calculated and paid monthly. For the year ended October 31, 2000, the
Portfolio incurred $317,706 for custody services. Custody fees for the Portfolio
were reduced by $16,616, as a result of an expense offset arrangement with the
Portfolio's custodian.
Board of Trustees' Fee. Each Trustee receives an annual fee as well as
reimbursement for reasonable out-of-pocket expenses from the Portfolio. For the
year ended October 31, 2000, the Portfolio incurred $19,061 for the trustee
fees.
3. Investment Transactions. For year ended October 31, 2000, the cost of
purchases and the proceeds of sales of investment securities other than
short-term investments were $102,382,533 and $108,298,853, respectively. There
were no purchases or sales of U.S. government obligations during the year.
<PAGE>
INDEPENDENT AUDITORS' REPORT
Trustees and Investors
BBH Pacific Basin Equity Portfolio:
We have audited the accompanying statement of assets and liabilities,
including the portfolio of investments, of BBH Pacific Basin Equity Portfolio as
of October 31, 2000, and the related statement of operations, the statement of
changes in net assets, and the financial highlights for the year then ended.
These financial statements and financial highlights are the responsibility of
the Portfolio's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation of
securities owned at October 31, 2000 by correspondence with the custodian. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of BBH Pacific Basin
Equity Portfolio at October 31, 2000, the results of its operations, the changes
in its net assets, and its financial highlights for the year then ended in
conformity with accounting principles generally accepted in the United States of
America.
DELOITTE & TOUCHE LLP
Boston, Massachusetts
December 22, 2000
<PAGE>
The 59 Wall Street Fund, Inc.
Investment Adviser and
Administrator
Brown Brothers Harriman
59 Wall Street
New York, New York 10005
Distributor
59 Wall Street Distributors, Inc.
21 Milk Street
Boston, Massachusetts 02109
Shareholder Servicing Agent
Brown Brothers Harriman
59 Wall Street
New York, New York 10005
(800) 625-5759
This report is submitted for the general information of shareholders and is not
authorized for distribution to prospective investors unless preceded or
accompanied by an effective prospectus. Nothing herein contained is to be
considered an offer of sale or a solicitation of an offer to buy shares of the
Funds. Such offering is made only by prospectus, which includes details as to
offering price and other material information.
Pacific Basin Equity Fund
ANNUAL REPORT
October 31, 2000
