FOR USE BY BANKS ONLY
February 28, 1995
DREYFUS EDISON ELECTRIC INDEX FUND, INC.
Supplement to Prospectus Dated February 28, 1995
All mutual fund shares involve certain investment risks, including
the possible loss of principal.
114/s022895IST
__________________________________________________________________________
DREYFUS EDISON ELECTRIC INDEX FUND, INC.
PART B
(STATEMENT OF ADDITIONAL INFORMATION)
FEBRUARY 28, 1995
__________________________________________________________________________
This Statement of Additional Information, which is not a prospectus,
supplements and should be read in conjunction with the current Prospectus
of Dreyfus Edison Electric Index Fund, Inc. (the "Fund"), dated February
28, 1995, as it may be revised from time to time. To obtain a copy of the
Fund's Prospectus, please write to the Fund at 144 Glenn Curtiss
Boulevard, Uniondale, New York 11556-0144, or call the following numbers:
Call Toll Free 1-800-645-6561
In New York City -- Call 1-718-895-1206
On Long Island -- Call 794-5452
Wells Fargo Nikko Investment Advisors ("WFNIA") serves as the Fund's
index fund manager.
The Dreyfus Corporation ("Dreyfus") serves as the Fund's
administrator.
Premier Mutual Fund Services, Inc. (the "Distributor") is the
distributor of the Fund's shares.
TABLE OF CONTENTS
Page
Investment Objective and Management Policies . . . . . . . . . . B-2
Management of the Fund . . . . . . . . . . . . . . . . . . . . . B-5
Index Management and Administration Agreements . . . . . . . . . B-8
Shareholder Services Plan. . . . . . . . . . . . . . . . . . . . B-11
Purchase of Fund Shares. . . . . . . . . . . . . . . . . . . . . B-12
Redemption of Fund Shares. . . . . . . . . . . . . . . . . . . . B-12
Shareholder Services . . . . . . . . . . . . . . . . . . . . . . B-13
Determination of Net Asset Value . . . . . . . . . . . . . . . . B-14
Dividends, Distributions and Taxes . . . . . . . . . . . . . . . B-15
Portfolio Transactions . . . . . . . . . . . . . . . . . . . . . B-16
Performance Information. . . . . . . . . . . . . . . . . . . . . B-16
Information About the Fund . . . . . . . . . . . . . . . . . . . B-17
Custodian, Transfer and Dividend Disbursing Agent,
Counsel and Independent Accountants. . . . . . . . . . . . . . B-17
Appendix . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-18
Financial Statements . . . . . . . . . . . . . . . . . . . . . . B-19
Report of Independent Accountants. . . . . . . . . . . . . . . . B-26
INVESTMENT OBJECTIVE AND MANAGEMENT POLICIES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled
"Description of the Fund."
Other Portfolio Securities
Securities issued or guaranteed by the U.S. Government or its
agencies or instrumentalities include U.S. Treasury securities, which
differ in their interest rates, maturities and times of issuance.
Treasury Bills have initial maturities of one year or less; Treasury Notes
have initial maturities of one to ten years; and Treasury Bonds generally
have initial maturities of greater than ten years. Some obligations
issued or guaranteed by U.S. Government agencies and instrumentalities,
for example, Government National Mortgage Association pass-through
certificates, are supported by the full faith and credit of the U.S.
Treasury; others, such as those of the Federal Home Loan Banks, by the
right of the issuer to borrow from the Treasury; others, such as those
issued by the Federal National Mortgage Association, by discretionary
authority of the U.S. Government to purchase certain obligations of the
agency or instrumentality; and others, such as those issued by the Student
Loan Marketing Association, only by the credit of the agency or
instrumentality. These securities bear fixed, floating or variable rates
of interest. Principal and interest may fluctuate based on generally
recognized reference rates or the relationship of rates. While the U.S.
Government provides financial support to such U.S. Government-sponsored
agencies or instrumentalities, no assurance can be given that it will
always do so, since it is not so obligated by law. The Fund will invest
in such securities only when it is satisfied that the credit risk with
respect to the issuer is minimal.
Repurchase agreements involve the acquisition by the Fund of an
underlying debt instrument, subject to an obligation of the seller to
repurchase, and the Fund to resell, the instrument at a fixed price,
usually not more than one week after its purchase. The Fund's custodian
or sub-custodian will have custody of, and will hold in a segregated
account, securities acquired by the Fund under a repurchase agreement.
Repurchase agreements are considered by the staff of the Securities and
Exchange Commission to be loans by the Fund. In an attempt to reduce the
risk of incurring a loss on a repurchase agreement, the Fund will enter
into repurchase agreements only with domestic banks with total assets in
excess of one billion dollars or primary government securities dealers
reporting to the Federal Reserve Bank of New York, with respect to
securities of the type in which the Fund may invest, and will require that
additional securities be deposited with it if the value of the securities
purchased should decrease below resale price. WFNIA will monitor on an
ongoing basis the value of the collateral to assure that it always equals
or exceeds the repurchase price. Certain costs may be incurred by the
Fund in connection with the sale of the securities if the seller does not
repurchase them in accordance with the repurchase agreement. In addition,
if bankruptcy proceedings are commenced with respect to the seller of the
securities, realization on the securities by the Fund may be delayed or
limited. The Fund will consider on an ongoing basis the creditworthiness
of the institutions with which it enters into repurchase agreements.
Time deposits are non-negotiable deposits maintained in a banking
institution for a specified period of time at a stated interest rate.
Time deposits which may be held by the Fund will not benefit from
insurance from the Bank Insurance Fund or the Savings Association
Insurance Fund administered by the Federal Deposit Insurance Corporation.
Certificates of deposit are negotiable certificates evidencing the
obligation of a bank to repay funds deposited with it for a specified
period of time.
Bankers' acceptances are credit instruments evidencing the obligation
of a bank to pay a draft drawn on it by a customer. These instruments
reflect the obligation both of the bank and of the drawer to pay the full
amount of the instrument upon maturity. Other short-term bank obligations
may include uninsured, direct obligations bearing fixed, floating or
variable interest rates.
Commercial paper consists of short-term, unsecured promissory notes
issued to finance short-term credit needs. The commercial paper purchased
by the Fund will consist only of direct obligations which, at the time of
their purchase, are (a) rated at least Prime-1 by Moody's Investors
Service, Inc. or A-1 by Standard & Poor's Corporation, (b) issued by
companies having an outstanding unsecured debt issue currently rated not
lower than Aa3 by Moody's Investors Service, Inc. or AA- by Standard &
Poor's Corporation, or (c) if unrated, determined by WFNIA to be of
comparable quality to those rated obligations which may be purchased by
the Fund.
Management Policies
Lending Portfolio Securities. To a limited extent, the Fund may lend
its portfolio securities to brokers, dealers and other financial
institutions, provided it receives cash collateral which at all times is
maintained in an amount equal to at least 100% of the current market value
of the securities loaned. For purposes of this policy, the Fund considers
collateral consisting of U.S. Government securities or irrevocable letters
of credit issued by banks whose securities meet the standards for
investment by the Fund to be the equivalent of cash. By lending its
portfolio securities, the Fund can increase its income through the
investment of the cash collateral. Such loans may not exceed 30% of the
value of the Fund's total assets. From time to time, the Fund may return
to the borrower or a third party which is unaffiliated with the Fund, and
which is acting as a "placing broker," a part of the interest earned from
the investment of collateral received for securities loaned.
The Securities and Exchange Commission currently requires that the
following conditions must be met whenever portfolio securities are loaned:
(1) the Fund must receive at least 100% cash collateral from the borrower;
(2) the borrower must increase such collateral whenever the market value
of the securities rises above the level of such collateral; (3) the Fund
must be able to terminate the loan at any time; (4) the Fund must receive
reasonable interest on the loan, as well as any dividends, interest or
other distributions payable on the loaned securities, and any increase in
market value; (5) the Fund may pay only reasonable custodian fees in
connection with the loan; and (6) while voting rights on the loaned
securities may pass to the borrower, the Fund's Board of Directors must
terminate the loan and regain the right to vote the securities if a
material event adversely affecting the investment occurs. These
conditions may be subject to future modification.
Investment Restrictions
The Fund has adopted the following investment restrictions as
fundamental policies. These restrictions cannot be changed without
approval by the holders of a majority (as defined in the Investment
Company Act of 1940 (the "Act")) of the Fund's outstanding voting shares.
The Fund may not:
1. Purchase securities of any company having less than three years'
continuous operations (including operations of any predecessors) if such
purchase would cause the value of the Fund's investments in all such
companies to exceed 5% of the value of its total assets.
2. Purchase securities of closed-end investment companies except
(a) in the open market where no commission other than the ordinary
broker's commission is paid, which purchases are limited to a maximum of
(i) 3% of the total outstanding voting stock of any one closed-end
investment company, (ii) 5% of the Fund's net assets with respect to the
securities issued by any one closed-end investment company and (iii) 10%
of the Fund's net assets in the aggregate, or (b) those received as part
of a merger or consolidation. The Fund may not purchase the securities of
open-end investment companies other than itself.
3. Purchase or sell real estate, real estate investment trust
securities, real estate limited partnership interests, commodities or
commodity contracts or oil, gas or other mineral exploration or
development programs, but the Fund may purchase and sell securities that
are secured by real estate or issued by companies that invest or deal in
real estate.
4. Borrow money, except from banks for temporary or emergency (not
leveraging) purposes in an amount up to 15% of the value of the Fund's
total assets (including the amount borrowed) based on the lesser of cost
or market, less liabilities (not including the amount borrowed) at the
time the borrowing is made. While borrowings exceed 5% of the value of
the Fund's total assets, the Fund will not make any additional
investments.
5. Pledge, hypothecate, mortgage or otherwise encumber its assets,
except to secure borrowings for temporary or emergency purposes.
6. Lend any funds or other assets except through the purchase of
debt securities, bankers' acceptances and commercial paper of corporations
and other entities. However, the Fund may lend its portfolio securities
in an amount not to exceed 30% of the value of its total assets. Any
loans of portfolio securities will be made according to guidelines
established by the Securities and Exchange Commission and the Fund's Board
of Directors.
7. Act as an underwriter of securities of other issuers. The Fund
may not enter into repurchase agreements providing for settlement in more
than seven days after notice or purchase illiquid securities, if, in the
aggregate, more than 10% of the value of the Fund's net assets would be so
invested.
8. Invest in the securities of a company for the purpose of
exercising management or control, but the Fund will vote the securities it
owns in its portfolio as a shareholder in accordance with its views.
9. Purchase, sell or write puts, calls or combinations thereof.
10. Invest more than 25% of its assets in investments in any
particular industry or industries other than the electric utility
industry, which includes companies engaged in the production, transmission
or distribution of electric energy, provided that, when the Fund has
adopted a temporary defensive posture, there shall be no limitation on the
purchase of obligations issued or guaranteed by the U.S. Government, its
agencies or instrumentalities.
In addition to the investment restrictions adopted as fundamental
policies set forth above, though not a fundamental policy, the Fund may
not engage in arbitrage transactions, nor may it purchase warrants
(excluding those acquired by the Fund in units or attached to securities),
nor will the Fund sell securities short, but reserves the right to sell
securities short against the box.
Notwithstanding Investment Restriction Nos. 3 and 5, the Fund
reserves the right to enter into futures contracts and options on futures
contracts, subject to the restrictions then in effect of the Securities
and Exchange Commission and the Commodity Futures Trading Commission and
to the receipt or taking, as the case may be, of appropriate consents,
approvals and other actions from or by those regulatory bodies. In any
event, no such contracts or options will be entered into until a general
description of the terms thereof are set forth in a subsequent prospectus
and statement of additional information, the Registration Statement with
respect to which has been filed with the Securities and Exchange
Commission and has become effective.
If a percentage restriction is adhered to at the time of investment,
a later change in percentage resulting from a change in values or assets
will not constitute a violation of such restriction.
The Fund may make commitments more restrictive than the restrictions
listed above so as to permit the sale of Fund shares in certain states.
Should the Fund determine that a commitment is no longer in the best
interests of the Fund and its shareholders, the Fund reserves the right to
revoke the commitment by terminating the sale of Fund shares in the state
involved.
MANAGEMENT OF THE FUND
Directors and officers of the Fund, together with information as to
their principal business occupations during at least the last five years,
are shown below. Each Director who is deemed to be an "interested person"
of the Fund, as defined in the Act, is indicated by an asterisk.
Directors of the Fund
*JOSEPH S. DiMARTINO, Chairman of the Board. Since January 1995, Mr.
DiMartino has served as Chairman of the Board for various funds in
the Dreyfus Family of Funds. For more than five years prior thereto,
he was President, a director and, until August 1994, Chief Operating
Officer of Dreyfus and Executive Vice President and a director of
Dreyfus Service Corporation, a wholly-owned subsidiary of Dreyfus
and, until August 1994, the Fund's distributor. From August 1994 to
December 31, 1994, he was a director of Mellon Bank Corporation. Mr.
DiMartino is a director and former Treasurer of the Muscular
Dystrophy Association; a trustee of Bucknell University; and a
director of the Noel Group, Inc. Mr. DiMartino is also a Board
member of other funds in the Dreyfus Family of Funds. His address is
200 Park Avenue, New York, New York 10166.
*DAVID P. FELDMAN, Director. Corporate Vice President-Investment
Management of AT&T. He is also a trustee of Corporate Property
Investors, a real estate investment company. His address is One Oak
Way, Berkeley Heights, New Jersey 07922.
JACK R. MEYER, Director. President and Chief Executive Officer of Harvard
Management Company, an investment management company, since September
1990. For more than five years prior thereto, he was Treasurer and
Chief Investment Officer of The Rockefeller Foundation. His address
is 600 Atlantic Avenue, Boston, Massachusetts 02210.
JOHN SZARKOWSKI, Director. Director Emeritus of Photography at The Museum
of Modern Art. Consultant in photography. His address is Bristol
Road Box 221, East Chatham, New York 12060.
ANNE WEXLER, Director. Chairman of the Wexler Group, consultants
specializing in government relations and public affairs. She is also
a director of American Cyanamid Company, Alumax, The Continental
Corporation, Comcast Corporation and The New England Electric System,
and a member of the Board of the Carter Center of Emory University,
the Council of Foreign Relations, the National Park Foundation,
Visiting Committee of the John F. Kennedy School of Government at
Harvard University and the Board of Visitors of the University of
Maryland School of Public Affairs. Her address is c/o The Wexler
Group, 1317 F Street, N.W., Washington, D.C. 20004.
Each Director is also a director of Dreyfus Stock Index Fund, Peoples
Index Fund, Inc., Peoples S&P MidCap Index Fund, Inc. and Dreyfus-Wilshire
Target Funds, Inc. Mr. Feldman and Ms. Wexler are also directors of
Dreyfus New Jersey Municipal Bond Fund, Inc. and Premier Global Investing,
managing general partners of Dreyfus Strategic Growth, L.P. and Dreyfus
Global Growth, L.P., and trustees of Dreyfus Florida Intermediate
Municipal Bond Fund, Dreyfus Florida Municipal Money Market Fund, Dreyfus
Investors GNMA Fund, Dreyfus New York Insured Tax Exempt Bond Fund,
Dreyfus 100% U.S. Treasury Intermediate Term Fund, Dreyfus 100% U.S.
Treasury Long Term Fund, Dreyfus 100% U.S. Treasury Money Market Fund and
Dreyfus 100% U.S. Treasury Short Term Fund. Mr. Feldman is also a
director of Dreyfus Strategic Governments Income, Inc. and Dreyfus BASIC
Money Market Fund, Inc. and a trustee of Dreyfus BASIC U.S. Government
Money Market Fund, Dreyfus California Intermediate Municipal Bond Fund,
Dreyfus Connecticut Intermediate Municipal Bond Fund, Dreyfus
Massachusetts Intermediate Municipal Bond Fund, Dreyfus New Jersey
Intermediate Municipal Bond Fund, Dreyfus Pennsylvania Intermediate
Municipal Bond Fund, Dreyfus Strategic Income and Dreyfus Strategic
Investing.
For so long as the Fund's plan described in the section captioned
"Shareholder Services Plan" remains in effect, the Directors of the Fund
who are not "interested persons" of the Fund, as defined in the Act, will
be selected and nominated by the Directors who are not "interested
persons" of the Fund.
The Fund does not pay any remuneration to its officers and Directors
other than fees and expenses to those Directors who are not officers,
directors, employees or holders of 5% or more of the outstanding voting
securities of WFNIA or Dreyfus, or their affiliates, which totalled
$20,320 for the fiscal year ended October 31, 1994 for such Directors as a
group.
Officers of the Fund
MARIE E. CONNOLLY, President and Treasurer. President and Chief Operating
Officer and a Director of the Distributor and an officer of other
investment companies advised or administered by Dreyfus. From
December 1991 to July 1994, she was President and Chief Compliance
Officer of Funds Distributor, Inc., a wholly-owned subsidiary of The
Boston Company, Inc. Prior to December 1991, she served as Vice
President and Controller, and later as Senior Vice President, of The
Boston Company Advisors, Inc.
JOHN E. PELLETIER, Vice President and Secretary. Senior Vice President -
General Counsel of the Distributor and an officer of other investment
companies advised or administered by Dreyfus. From February 1992 to
July 1994, he served as Counsel for The Boston Company Advisors, Inc.
From August 1990 to February 1992, he was employed as an Associate at
Ropes & Gray, and prior to August 1990, he was employed as an
Associate at Sidley & Austin.
JOSEPH F. TOWER, III, Assistant Treasurer. Senior Vice President,
Treasurer and Chief Financial Officer of the Distributor and an
officer of other investment companies advised or administered by
Dreyfus. From July 1988 to August 1994, he was employed by The
Boston Company, Inc. where he held various management positions in
the Corporate Finance and Treasury areas.
FREDERICK C. DEY, Vice President and Assistant Treasurer. Senior Vice
President of the Distributor and an officer of other investment
companies advised or administered by Dreyfus. From 1988 to August
1994, he was manager of the High Performance Fabric Division of
Springs Industries Inc.
JOHN J. PYBURN, Assistant Treasurer. Vice President of the Distributor
and an officer of other investment companies advised or administered
by Dreyfus. From 1984 to July 1994, he was Assistant Vice President
in the Mutual Fund Accounting Department of Dreyfus.
PAUL FURCINITO, Assistant Secretary. Assistant Vice President of the
Distributor and an officer of other investment companies advised or
administered by Dreyfus. From January 1992 to July 1994, he was a
Senior Legal Product Manager, and, from January 1990 to January 1992,
he was a mutual fund accountant, for The Boston Company Advisors,
Inc.
ERIC B. FISCHMAN, Vice President and Assistant Secretary. Associate
General Counsel of the Distributor and an officer of other investment
companies advised or administered by Dreyfus. From September 1992 to
August 1994, he was an attorney with the Board of Governors of the
Federal Reserve System.
RUTH D. LEIBERT, Assistant Secretary. Assistant Vice President of the
Distributor and an officer of other investment companies advised or
administered by Dreyfus. From March 1992 to July 1994, she was a
Compliance Officer for The Managers Funds, a registered investment
company. From March 1990 until September 1991, she was Development
Director of The Rockland Center for the Arts and, prior thereto, was
employed as a Research Assistant for the Bureau of National Affairs.
The address of each officer of the Fund is 200 Park Avenue, New York,
New York 10166.
Directors and officers of the Fund, as a group, owned less than 1% of
the Fund's shares of Common Stock outstanding on December 6, 1994.
The following persons are known by the Fund to own of record 5% or
more of the Fund's outstanding voting securities on December 6, 1994:
State Street Bank & Trust Co., as Trustee for Pacific Gas & Electric Co.
Savings Fund Plan, P.O. Box 1992, Boston, Massachusetts 02105 -- 66.7%. A
shareholder that owns, directly or indirectly, 25% or more of the Fund's
voting securities may be deemed to be a "control person" (as defined in
the Act) of the Fund.
Industry Advisory Board
The Fund also has an Industry Advisory Board which routinely provides
management of the Fund with information and data regarding the electric
utility industry. The members of the Industry Advisory Board, together
with information as to their principal business occupations during at
least the last five years, are set forth below.
H. Peter Burg, Senior Vice President and Chief Financial Officer of Ohio
Edison Company. His address is 76 South Main Street, Akron, Ohio
44308.
H. Lowell Davis, Vice Chairman and Chief Financial Officer of Potomac
Electric Power Company. His address is 1900 Pennsylvania Avenue,
N.W., Washington, D.C. 20068.
Gordon R. Smith, Vice President and Chief Financial Officer, since 1991,
and Vice President, Finance and Rates, from 1987 to 1991, of Pacific
Gas and Electric Company. His address is P.O. Box 770000, San
Francisco, California 94177.
Russel E. Olson, Vice President--Finance and Treasurer of Puget Sound
Power & Light Company. His address is P.O. Box 97034, Bellevue,
Washington 98009.
W. L. Westbrook, Financial Vice President of The Southern Company. His
address is 64 Perimeter Center East, Atlanta, Georgia 30346.
INDEX MANAGEMENT AND ADMINISTRATION AGREEMENTS
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Management
of the Fund."
Index Management Agreement. WFNIA provides management services
pursuant to the Index Management Agreement (the "Management Agreement")
dated May 2, 1991, as revised August 8, 1991, with the Fund, which is
subject to annual approval by (i) the Fund's Board of Directors or (ii)
vote of a majority (as defined in the Act) of the outstanding voting
securities of the Fund, provided that in either event the continuance also
is approved by a majority of the Directors who are not "interested
persons" (as defined in the Act) of the Fund or WFNIA, by vote cast in
person at a meeting called for the purpose of voting on such approval.
The Management Agreement was approved by shareholders at a meeting held on
August 12, 1992 and was last approved by the Fund's Board of Directors,
including a majority of the Directors who are not "interested persons" (as
defined in the Act) of any party to the Management Agreement, at a meeting
held on May 4, 1994. The Management Agreement is terminable without
penalty, on 60 days' notice, by the Fund's Board of Directors or by vote
of the holders of a majority of the Fund's shares, or, upon not less than
90 days' notice, by WFNIA. The Management Agreement will terminate
automatically in the event of its assignment (as defined in the Act).
As compensation for WFNIA's services, the Fund has agreed to pay
WFNIA a monthly index management fee at the annual rate of .10 of 1% of
the value of the Fund's average daily net assets. All fees and expenses
are accrued daily and deducted before declaration of dividends to
investors. For the period December 6, 1991 (commencement of operations)
through October 31, 1992, and for the fiscal years ended October 31, 1993
and 1994, the index management fees payable to WFNIA were $17,322, $79,485
and $88,756, respectively. However, no index management fee was paid for
the period ended October 31, 1992 pursuant to an undertaking by WFNIA. In
addition, Wells Fargo Institutional Trust Company, N.A., the Fund's
custodian, which is owned by WFNIA and Wells Fargo & Company, waived
receipt of $39,311 chargeable to the Fund for custodian fees for the
fiscal year ended October 31, 1992.
The Fund has agreed that neither WFNIA nor Dreyfus will be liable for
any error of judgment or mistake of law or for any loss suffered by the
Fund in connection with the matters to which WFNIA's or Dreyfus'
respective agreements with the Fund relates, except for a loss resulting
from willful misfeasance, bad faith or gross negligence on the part of
WFNIA or Dreyfus, as the case may be, in the performance of its
obligations or from reckless disregard by it of its obligations and duties
under its respective agreements with the Fund.
Administration Agreement. Pursuant to the Administration Agreement
(the "Administration Agreement") dated August 24, 1994 with the Fund,
Dreyfus, together with WFNIA, furnishes the Fund clerical help and
accounting, data processing, bookkeeping, internal auditing and legal
services and certain other services required by the Fund, prepares reports
to the Fund's shareholders, tax returns, reports to and filings with the
Securities and Exchange Commission and state Blue Sky authorities, and
generally assists in all aspects of the Fund's operations, other than
providing investment advice. Dreyfus bears all expenses in connection
with the performance of its services and pays the salaries of all officers
and employees who are employed by both it and its affiliates and the Fund.
The Administration Agreement is subject to annual approval by (i) the
Fund's Board of Directors or (ii) vote of a majority (as defined in the
Act) of the Fund's outstanding voting securities, provided that in either
event the continuance also is approved by a majority of the Directors who
are not "interested persons" (as defined in the Act) of the Fund or
Dreyfus, by vote cast in person at a meeting called for the purpose of
voting on such approval. The Administration Agreement was approved by the
Fund's Board of Directors, including a majority of the Directors who are
not "interested persons" of any party to the Administration Agreement, at
a meeting held on June 1, 1994. The Administration Agreement is
terminable without penalty, on 60 days' notice, by the Fund's Board of
Directors or by vote of the holders of a majority of the Fund's shares.
The Administration Agreement is terminable upon not less than 90 days'
notice by Dreyfus and will terminate automatically in the event of its
assignment (as defined in the Act).
As compensation for Dreyfus' services, the Fund has agreed to pay
Dreyfus a monthly administration fee at the annual rate of .15 of 1% of
the value of the Fund's average daily net assets. For the period December
6, 1991 (commencement of operations) through October 31, 1992 and for the
fiscal years ended October 31, 1993 and 1994, the administration fees
payable to Dreyfus were $25,983, $119,228 and $133,134, respectively.
However, no administration fee was paid for the fiscal year ended October
31, 1992, and the administration fee was reduced by $72,895 for the fiscal
year ended October 31, 1993, pursuant to undertakings by Dreyfus.
The following persons are officers and/or directors of Dreyfus:
Howard Stein, Chairman of the Board and Chief Executive Officer; Julian M.
Smerling, Vice Chairman of the Board of Directors; Joseph S. DiMartino,
President and a director; W. Keith Smith, Chief Operating Officer and a
director; Paul H. Snyder, Vice President--Finance and Chief Financial
Officer; Daniel C. Maclean III, General Counsel and Vice President;
Robert F. Dubuss, Vice President; Elie M. Genadry, Vice President--
Institutional Sales; Henry D. Gottmann, Vice President--Retail Sales and
Service; Jeffrey N. Nachman, Vice President--Fund Administration; Philip
L. Toia, Vice Chairman--Operations and Administration; Lawrence S. Kash,
Vice Chairman--Distribution; Jay R. DeMartine, Vice President--Retail
Marketing; Barbara E. Casey, Vice President--Retirement Services; Diane M.
Coffey, Vice President--Corporate Communications; Katherine C. Wickham,
Vice President--Human Resources; Maurice Bendrihem--Controller; Mark N.
Jacobs, Vice President--Legal and Secretary; and Mandell L. Berman, Alvin
E. Friedman, Lawrence M. Greene, Frank V. Cahouet and David B. Truman,
directors.
Expenses and Expense Information. All expenses incurred in the
operation of the Fund are borne by the Fund, except to the extent
specifically assumed by WFNIA and/or Dreyfus. The expenses borne by the
Fund include the following: organizational costs, taxes, interest,
brokerage fees and commissions, if any, fees of Directors who are not
officers, directors, employees or holders of 5% or more of the outstanding
voting securities of WFNIA or Dreyfus or their affiliates, Securities and
Exchange Commission fees, state Blue Sky qualification fees, index
management and administration fees, charges of custodians, transfer and
dividend disbursing agents' fees, certain insurance premiums, industry
association fees, outside auditing and legal expenses, costs of
maintaining corporate existence, costs of independent pricing services,
costs attributable to investor services (including, without limitation,
telephone and personnel expenses), costs of shareholders' reports and
corporate meetings, costs of preparing and printing prospectuses and
statements of additional information for regulatory purposes and for
distribution to existing shareholders, and any extraordinary expenses.
WFNIA and Dreyfus have agreed that if in any fiscal year the
aggregate expenses of the Fund (including fees pursuant to the Management
Agreement and the Administration Agreement, but excluding taxes,
brokerage, interest on borrowings and, with the prior written consent of
the necessary state securities commissions, extraordinary expenses) exceed
the expense limitation of any state having jurisdiction over the Fund, the
Fund may deduct from the fees to be paid to each of WFNIA and Dreyfus, or
Dreyfus will bear, such excess expense in proportion to their management
fee and administration fee, to the extent required by state law. Such
deduction or payment, if any, will be estimated daily and reconciled and
effected or paid, as the case may be, on a monthly basis.
The aggregate of the fees payable to WFNIA and Dreyfus is not subject
to reduction as the value of the Fund's net assets increase.
SHAREHOLDER SERVICES PLAN
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled
"Shareholder Services Plan."
The Fund has adopted a Shareholder Services Plan (the "Plan")
pursuant to which the Fund reimburses Dreyfus Service Corporation, a
wholly-owned subsidiary of Dreyfus, for certain allocated expenses of
providing personal services and/or maintaining shareholder accounts. The
service provided may include personal services related to shareholder
accounts, such an answering shareholder inquiries regarding the Fund and
providing reports and other information, and services related to the
maintenance of shareholder accounts.
A quarterly report of the amounts expended under the Plan, and the
purposes for which such expenditures were incurred, must be made to the
Directors for their review. In addition, the Plan provides that material
amendments of the Plan must be approved by the Board of Directors, and by
the Directors who are not "interested persons" (as defined in the Act) of
the Fund and have no direct or indirect financial interest in the
operation of the Plan, by vote cast in person at a meeting called for the
purpose of considering such amendments. The Plan is subject to annual
approval by such vote of the Directors cast in person at a meeting called
for the purpose of voting on the Plan. The Plan is terminable at any time
by vote of a majority of the Directors who are not "interested persons"
(as defined in the Act) of the Fund and have no direct or indirect
financial interest in the operation of the Plan.
For the fiscal year ended October 31, 1994, $221,890 was charged to
the Fund under the Plan.
PURCHASE OF FUND SHARES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "How to Buy
Fund Shares."
The Distributor. The Distributor serves as the Fund's distributor
pursuant to an agreement which is renewable annually. The Distributor
also acts as distributor for the other funds in the Dreyfus Family of
Funds and for certain other investment companies.
Transactions through Securities Dealers. In some states, banks or
other financial institutions effecting transactions in Fund shares may be
required to register as dealers pursuant to state law.
REDEMPTION OF FUND SHARES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "How to
Redeem Fund Shares."
Wire Redemption Privilege. By using this Privilege, the investor
authorizes the Transfer Agent to act on wire or telephone redemption
instructions from any person representing himself or herself to be the
investor, and reasonably believed by the Transfer Agent to be genuine.
Ordinarily, the Fund will initiate payment for shares redeemed pursuant to
this Privilege on the next business day after receipt if the Transfer
Agent receives the redemption request in proper form. Redemption proceeds
will be transferred by Federal Reserve wire only to the commercial bank
account specified by the investor on the Account Application or
Shareholder Services Form. Redemption proceeds, if wired, must be in the
amount of $1,000 or more and will be wired to the investor's account at
the bank of record designated in the investor's file at the Transfer
Agent, if the investor's bank is a member of the Federal Reserve System,
or to a correspondent bank if the investor's bank is not a member. Fees
ordinarily are imposed by such bank and usually are borne by the investor.
Immediate notification by the correspondent bank to the investor's bank is
necessary to avoid a delay in crediting the funds to the investor's bank
account.
Investors with access to telegraphic equipment may wire redemption
requests to the Transfer Agent by employing the following transmittal code
which may be used for domestic or overseas transmissions:
Transfer Agent's
Transmittal Code Answer Back Sign
144295 144295 TSSG PREP
Investors who do not have direct access to telegraphic equipment may
have the wire transmitted by contacting a TRT Cables operator at 1-800-
654-7171, toll free. Investors should advise the operator that the above
transmittal code must be used and should also inform the operator of the
Transfer Agent's answer back sign.
To change the commercial bank or account designated to receive wire
redemption proceeds, a written request must be sent to the Transfer Agent.
This request must be signed by each shareholder, with each signature
guaranteed as described below under "Signatures."
Signatures. Written redemption requests must be signed by each
shareholder, including each holder of a joint account, and each signature
must be guaranteed. The Transfer Agent has adopted standards and
procedures pursuant to which signature-guarantees in proper form generally
will be accepted from domestic banks, brokers, dealers, credit unions,
national securities exchanges, registered securities associations,
clearing agencies and savings associations, as well as from participants
in the New York Stock Exchange Medallion Signature Program, the Securities
Transfer Agents Medallion Program ("STAMP") and the Stock Exchanges
Medallion Program. Guarantees must be signed by an authorized signatory
of the guarantor and "Signature-Guaranteed" must appear with the
signature. The Transfer Agent may request additional documentation from
corporations, executors, administrators, trustees or guardians, and may
accept other suitable verification arrangements from foreign investors.
For more information with respect to signature-guarantees, please call one
of the telephone numbers listed on the cover.
Redemption Commitment. The Fund has committed to pay in cash all
redemption requests by any shareholder of record, limited in amount during
any 90-day period to the lesser of $250,000 or 1% of the value of the
Fund's net assets at the beginning of such period. Such commitment is
irrevocable without the prior approval of the Securities and Exchange
Commission. In the case of requests for redemption in excess of such
amount, the Board of Directors reserves the right to make payments in
whole or part in securities or other assets of the Fund in case of an
emergency or any time a cash distribution would impair the liquidity of
the Fund to the detriment of the existing shareholders. In such event,
the securities would be valued in the same manner as the Fund's portfolio
is valued. If the recipient sold such securities, brokerage charges would
be incurred.
Suspension of Redemptions. The right of redemption may be suspended
or the date of payment postponed (a) during any period when the New York
Stock Exchange is closed (other than customary weekend and holiday
closings), (b) when trading in the markets the Fund ordinarily utilizes is
restricted, or when an emergency exists as determined by the Securities
and Exchange Commission so that disposal of the Fund's investments or
determination of its net asset value is not reasonably practicable, or (c)
for such other periods as the Securities and Exchange Commission by order
may permit to protect the Fund's shareholders.
SHAREHOLDER SERVICES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled
"Shareholder Services."
Corporate Pension, Profit-Sharing and Personal Retirement Plans. The
Fund makes available to corporations a variety of prototype pension and
profit-sharing plans including a 401(k) Salary Reduction Plan. In
addition, the Fund makes available Keogh Plans, IRAs, including IRAs set
up under a Simplified Employee Pension Plan ("SEP-IRAs") and IRA "Rollover
Accounts," and 403(b)(7) Plans. Plan support services also are available.
Investors can obtain details on the various plans by calling the following
numbers toll free: for Keogh Plans, please call 1-800-358-5566; for IRAs
and IRA "Rollover Accounts," please call 1-800-645-6561; for SEP-IRAs,
401(k) Salary Reduction Plans and 403(b)(7) Plans, please call 1-800-322-
7880.
Investors who wish to purchase Fund shares in conjunction with a
Keogh Plan, a 403(b)(7) Plan or an IRA, including a SEP-IRA, may request
from the Distributor forms for adoption of such plans.
A fee may be charged by the entity acting as custodian for Keogh
Plans, 403(b)(7) Plans or IRAs, payment of which could require the
liquidation of shares. All fees charged are described in the appropriate
form.
Shares may be purchased in connection with these plans only by direct
remittance to the entity which acts as custodian. Purchases for these
plans may not be made in advance of receipt of funds.
The minimum initial investment for corporate plans, Salary Reduction
Plans, 403(b)(7) Plans, and SEP-IRAs, with more than one participant, is
$2,500, with no minimum on subsequent purchases. The minimum initial
investment for Dreyfus-sponsored Keogh Plans, IRAs, SEP-IRAs and 403(b)(7)
Plans, with only one participant, is normally $750, with no minimum on
subsequent purchases. Individuals who open an IRA also may open a non-
working spousal IRA with a minimum investment of $250.
The investor should read the Prototype Retirement Plan and the
appropriate form of Custodial Agreement for further details as to
eligibility, service fees and tax implications, and should consult a tax
adviser.
DETERMINATION OF NET ASSET VALUE
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "How to Buy
Fund Shares."
Valuation of Portfolio Securities. The Fund's portfolio securities
are valued at the last sale price on the securities exchange or national
securities market on which such securities are primarily traded.
Securities not listed on an exchange or national securities market, or
securities in which there were no transactions, are valued at the average
of the most recent bid and asked prices. Bid price is used when no asked
price is available. Any securities or other assets for which recent
market quotations are not readily available are valued at fair value as
determined in good faith by the Board of Directors. Expenses and fees,
including the index management and administration fees (reduced by the
expense limitation, if any), are accrued daily and taken into account for
the purpose of determining the net asset value of Fund shares.
New York Stock Exchange Closings. The holidays (as observed) on
which the New York Stock Exchange is closed currently are: New Year's
Day, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor
Day, Thanksgiving and Christmas.
DIVIDENDS, DISTRIBUTIONS AND TAXES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Dividends,
Distributions and Taxes."
Management of the Fund believes that the Fund qualified for the
fiscal year ended October 31, 1994 as a "regulated investment company"
under the Internal Revenue Code of 1986, as amended (the "Code"). To
qualify as a regulated investment company, the Fund must distribute at
least 90% of its investment company taxable income (consisting of net
investment income and net short-term capital gain) to its shareholders,
must derive less than 30% of its annual gross income from gain on the sale
of securities held for less than three months, and must meet certain asset
diversification and other requirements. The term "regulated investment
company" does not imply the supervision of management or investment
practices or policies by any government agency.
Ordinarily, gains and losses realized from portfolio transactions
will be treated as capital gain or loss. In addition, all or a portion of
the gain realized from engaging in "conversion transactions" may be
treated as ordinary income under Section 1258. "Conversion transactions"
are defined to include certain forward, futures, option and "straddle"
transactions, transactions marketed or sold to produce capital gains, or
transactions described in Treasury regulations to be issued in the future.
Any dividend or distribution paid shortly after an investor's
purchase may have the effect of reducing the net asset value of his shares
below the cost of his investment. Such a distribution would be a return
on the investment in an economic sense although taxable as stated in the
Fund's Prospectus. In addition, the Code provides that if a shareholder
holds shares of the Fund for six months or less and has received a capital
gain distribution with respect to such shares, any loss incurred on the
sale of such shares will be treated as a long-term capital loss to the
extent of the capital gain distribution received.
Depending on the composition of the Fund's income, all or a portion
of the dividends paid by the Fund from net investment income may qualify
for the dividends received deduction allowable to certain U.S. corporate
shareholders ("dividends received deduction"). In general, dividend
income of the Fund distributed to qualifying corporate shareholders will
be eligible for the dividends received deduction only to the extent that
(i) the Fund's income consists of dividends paid by U.S. corporations and
(ii) the Fund would have been entitled to the dividends received deduction
with respect to such dividend income if the Fund were not a regulated
investment company. The dividends received deduction for qualifying
corporate shareholders may be further reduced if the shares of the Fund
held by them with respect to which dividends are received are treated as
debt-financed or deemed to have been held for less than 46 days. In
addition, the Code provides other limitations with respect to the ability
of a qualifying corporate shareholder to claim the dividends received
deduction in connection with holding Fund shares.
PORTFOLIO TRANSACTIONS
WFNIA assumes general supervision over placing orders on behalf of
the Fund for the purchase or sale of portfolio securities. Allocation of
brokerage transactions, including their frequency, is made in the best
judgment of WFNIA and in a manner deemed fair and reasonable to
shareholders. The primary consideration is prompt execution of orders at
the most favorable net price. Brokers also are selected because of their
ability to handle special executions such as are involved in large block
trades or broad distributions, provided the primary consideration is met.
Portfolio turnover may vary from year to year, as well as within a year.
High turnover rates are likely to result in comparatively greater
brokerage expenses. The overall reasonableness of brokerage commissions
paid is evaluated by WFNIA based upon its knowledge of available
information as to the general level of commissions paid by other
institutional investors for comparable services.
For its portfolio securities transactions for the period December 6,
1991 (commencement of operations) through October 31, 1992 and for the
fiscal years ended October 31, 1993 and 1994, the Fund paid total
brokerage commissions of $52,786, $146,712 and $67,988, respectively, none
of which was paid to the Distributor. There were no spreads or
concessions on principal transactions in fiscal 1992, 1993 and 1994.
PERFORMANCE INFORMATION
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled
"Performance Information."
The Fund's average annual total return for the 1 and 2.904 year
periods ended October 31, 1994 was -17.41% and 2.05%, respectively.
Average annual total return is calculated by determining the ending
redeemable value of an investment purchased with a hypothetical $1,000
payment made at the beginning of the period (assuming the reinvestment of
dividends and distributions), dividing by the amount of the initial
investment, taking the "n"th root of the quotient (where "n" is the number
of years in the period) and subtracting 1 from the result.
The Fund's total return for the period December 6, 1991 (commencement
of operations) to October 31, 1994 was 6.07%. Total return is calculated
by subtracting the amount of the Fund's net asset value per share at the
beginning of a stated period from the net asset value per share at the end
of the period (after giving effect to the reinvestment of dividends and
distributions during the period), and dividing the result by the net asset
value per share at the beginning of the period.
From time to time, advertising materials for the Fund may include
reference to, or discussion of, the dividend income or growth history of
the electric utility industry generally. From time to time, advertising
materials for the Fund also may refer to Morningstar ratings and related
analysis supporting such ratings.
INFORMATION ABOUT THE FUND
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "General
Information."
Each Fund share has one vote and, when issued and paid for in
accordance with the terms of the offering, is fully paid and non-
assessable. Fund shares are of one class and have equal rights as to
dividends and in liquidation. Shares have no preemptive, subscription or
conversion rights and are freely transferable.
The Fund will send annual and semi-annual financial statements to all
its shareholders.
CUSTODIAN, TRANSFER AND DIVIDEND DISBURSING AGENT, COUNSEL
AND INDEPENDENT ACCOUNTANTS
Wells Fargo Institutional Trust Company, N.A., 45 Fremont Street, San
Francisco, California 94163, acts as custodian of the Fund's investments.
The Shareholder Services Group, Inc., a subsidiary of First Data
Corporation, P.O. Box 9671, Providence, Rhode Island 02940-9671, acts as
transfer and dividend disbursing agent. Neither Wells Fargo Institutional
Trust Company, N.A. nor The Shareholder Services Group, Inc. has any part
in determining the investment policies of the Fund or which securities are
to be purchased or sold by the Fund.
Stroock & Stroock & Lavan, 7 Hanover Square, New York, New York
10004-2696, as counsel for the Fund, has rendered its opinion as to
certain legal matters regarding the due authorization and valid issuance
of the shares of Common Stock being sold pursuant to the Fund's
Prospectus.
Coopers & Lybrand L.L.P., 1301 Avenue of the Americas, New York, New
York 10019-6013, independent accountants, have been selected as auditors
of the Fund.
APPENDIX
Description of Standard & Poor's Corporation ("S&P") A-1
Commercial Paper Ratings:
The rating A is the highest rating and is assigned by S&P to
issues that are regarded as having the greatest capacity for timely
payment. Issues in this category are delineated with the number 1, 2 or 3
to indicate the relative degree of safety. Paper rated A-1 indicates that
the degree of safety regarding timely payment is either overwhelming or
very strong. Those issues determined to possess overwhelming safety
characteristics are denoted with a plus (+) sign designation.
Description of Moody's Investors Service, Inc. ("Moody's)
Prime-1 Commercial Paper Ratings:
The rating Prime-1 (P-1) is the highest commercial paper
rating assigned by Moody's. Issuers of P-1 paper must have a superior
capacity for repayment of short-term promissory obligations, and
ordinarily will be evidenced by leading market positions in well
established industries, high rates of return on funds employed,
conservative capitalization structures with moderate reliance on debt and
ample asset protection, broad margins in earnings coverage of fixed
financial charges and high internal cash generation, and well established
access to a range of financial markets and assured sources of alternate
liquidity.
<TABLE>
DREYFUS EDISON ELECTRIC INDEX FUND, INC.
STATEMENT OF INVESTMENTS OCTOBER 31, 1994
SHARES COMMON STOCKS_98.4% VALUE
------- ------------
<S> <C> <C>
39,150 Allegheny Power System..... $ 812,362
61,550 American Electric Power.... 1,969,600
17,550 Atlantic Energy............ 296,156
49,050 Baltimore Gas & Electric... 1,140,412
6,050 Bangor Hydro Electric .... 65,037
4,500 Black Hills................ 92,250
14,875 Boston Edison.............. 347,703
4,225 CILCORP................... 128,862
11,250 CIPSCO..................... 319,219
28,300 CMS Energy................. 650,900
53,500 Carolina Power & Light..... 1,411,062
48,275 Centerior Energy........... 398,269
63,100 Central & South West....... 1,419,750
5,475 Central Hudson Gas & Electric 134,137
7,250 Central Louisiana Electric 156,781
10,425 Central Maine Power........ 119,887
5,100 Central Vermont Public Service 67,575
49,219 CiNergy.................... 1,138,187
3,275 Commonwealth Energy System 123,631
78,350 Consolidated Edison........ 1,948,956
35,400 DPL........................ 721,275
17,600 DQE........................ 532,400
19,425 Delmarva Power & Light..... 366,647
49,000 Detroit Edison............. 1,292,375
56,425 Dominion Resources......... 2,094,778
68,350 Duke Power................. 2,708,369
2,914 Eselco.................... 69,936
6,150 Eastern Utilities Association 134,531
57,475 (a) El Paso Electric 61,067
4,250 Empire District Electric 68,531
76,217 Entergy.................... 1,781,570
63,575 FPL Group.................. 2,105,922
30,962 Florida Progress........... 905,638
38,275 General Public Utilities... 985,581
2,775 Green Mountain Power 69,722
9,150 Hawaiian Electric Industries 297,375
43,550 Houston Industries......... 1,518,806
9,300 IES Industries 238,312
12,475 IPALCO Enterprises......... 377,369
12,250 Idaho Power................ 283,281
25,000 Illinova................... 493,750
3,250 Interstate Power 72,313
9,575 Iowa-Illinois Gas & Electric 196,288
12,500 KU Energy.................. 340,625
20,500 Kansas City Power & Light.. 458,688
10,850 LG & E Energy.............. 410,944
38,875 Long Island Lighting....... 690,031
6,200 MDU Resources Group 168,175
3,425 Madison Gas & Electric 113,025
2,925 Maine Public Service 69,469
17,975 Midwest Resources.......... 253,897
10,250 Minnesota Power & Light.... 267,781
17,325 Montana Power.............. 398,475
21,825 NIPSCO Industries.......... 608,372
13,625 Nevada Power............... 269,094
SHARES COMMON STOCKS (CONTINUED) VALUE
------- ------------
21,575 New England Electric System $ 676,916
23,300 New York State Electric & Gas 442,700
47,625 Niagara Mohawk Power....... 654,844
41,350 Northeast Utilities........ 956,219
22,300 Northern States Power...... 989,563
2,650 Northwestern Public Service .. 68,900
50,725 Ohio Edison................ 976,456
13,325 Oklahoma Gas & Electric.... 449,719
4,325 Orange/Rockland Utilities.. 131,372
3,575 Otter Tail Power........... 116,634
73,875 PECO Energy................ 1,893,047
143,875 Pacific Gas & Electric...... 3,237,188
94,075 PacifiCorp................. 1,658,072
50,525 Pennsylvania Power & Light. 991,553
28,925 Pinnacle West Capital...... 538,728
16,375 Portland General........... 284,516
38,975 Potomac Electric Power..... 750,269
19,900 Public Service Co. of Colorado 542,275
13,600 (a) Public Service Co. of New Mexico 168,300
81,675 Public Service Enterprise Group 2,143,969
20,925 Puget Sound Power & Light.. 423,731
12,150 Rochester Gas & Electric... 253,631
15,450 SCANA...................... 666,281
149,350 SCEcorp..................... 2,072,231
2,475 St. Joseph Light & Power 67,753
38,725 San Diego Gas & Electric... 774,500
9,475 Sierra Pacific Resources 182,394
216,750 Southern.................... 4,280,813
5,033 Southern Indiana Gas & Electric 134,633
13,500 Southwestern Public Service 352,688
38,400 TECO Energy................ 744,000
4,975 TNP Enterprises.......... 69,028
75,375 Texas Utilities............ 2,459,109
52,800 (a) Tucson Electric Power 184,800
10,550 UGI.................... 212,319
4,038 UNITIL.................. 68,646
71,250 Unicom..................... 1,540,781
33,975 Union Electric............. 1,218,853
4,575 United Illuminating 139,538
4,250 Upper Peninsula Power 66,938
14,625 UtiliCorp United........... 404,016
9,975 WPL Holdings............. 281,794
17,250 Washington Water Power..... 252,281
20,399 Western Resources.......... 589,021
35,462 Wisconsin Energy........... 939,743
7,825 Wisconsin Public Service 215,188
----------
TOTAL COMMON STOCKS
(cost $87,085,665)......... $70,431,098
===========
</TABLE>
<TABLE>
<S> <C> <C>
TOTAL INVESTMENTS
(cost $87,085,665).......... 98.4% $70,431,098
===== ===========
CASH AND RECEIVABLES (NET).. 1.6% $ 1,155,782
===== ===========
NET ASSETS.................. 100.0% $71,586,880
===== ===========
</TABLE>
NOTE TO STATEMENT OF INVESTMENTS;
(a) Non-income producing.
See notes to financial statements.
<TABLE>
<CAPTION>
DREYFUS EDISON ELECTRIC INDEX FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES OCTOBER 31, 1994
<S> <C> <C>
ASSETS:
Investments in securities, at value
(cost $87,085,665)_see statement...................................... $ 70,431,098
Receivable for investment securities sold............................... 1,266,068
Dividends receivable.................................................... 271,414
Prepaid expenses........................................................ 57,418
------------
72,025,998
LIABILITIES:
Due to Wells Fargo Nikko Investment Advisors............................ $ 45,506
Due to Wells Fargo Institutional Trust Company, N.A..................... 13,892
Due to The Dreyfus Corporation.......................................... 19,292
Payable for investment securities purchased............................. 247,965
Accrued expenses........................................................ 112,463 439,118
--------- ------------
NET ASSETS.................................................................. $ 71,586,880
============
REPRESENTED BY:
Paid-in capital......................................................... $ 89,280,871
Accumulated undistributed investment income-net......................... 311,690
Accumulated net realized (loss) on investments.......................... (1,351,114)
Accumulated net unrealized (depreciation) on investments_Note 3......... (16,654,567)
------------
NET ASSETS at value applicable to 6,350,024 shares outstanding
(200 million shares of .001 par value Common Stock authorized).......... $ 71,586,880
============
NET ASSET VALUE, offering and redemption price per share
($71,586,880 / 6,350,024 shares)........................................ $11.27
======
See notes to financial statements.
</TABLE>
<TABLE>
DREYFUS EDISON ELECTRIC INDEX FUND, INC.
STATEMENT OF OPERATIONS YEAR ENDED OCTOBER 31, 1994
<S> <C> <C>
INVESTMENT INCOME:
INCOME:
Cash dividends........................................................ $ 5,657,198
Interest ............................................................. 25,745
-------------
TOTAL INCOME.................................................... $ 5,682,943
EXPENSES:
Index management fee_Note 2(a)........................................ 88,756
Administration fee_Note 2(a).......................................... 133,134
Shareholder servicing costs_Note 2(b)................................. 270,208
Auditing fees......................................................... 58,566
Organization expenses................................................. 32,107
Registration fees..................................................... 22,814
Directors' fees and expenses_Note 2(c)................................ 20,320
Prospectus and shareholders' reports.................................. 11,353
Legal Fees............................................................ 11,181
Miscellaneous......................................................... 12,679
-------------
TOTAL EXPENSES.................................................. 661,118
----------
INVESTMENT INCOME_NET.......................................... 5,021,825
REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS:
Net realized (loss) on investments_Note 3............................... $ (1,108,323)
Net unrealized (depreciation) on investments............................ (23,241,389)
-------------
NET REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS............... (24,349,712)
----------
NET (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS...................... $(19,327,887)
=============
See notes to financial statements.
</TABLE>
<TABLE>
DREYFUS EDISON ELECTRIC INDEX FUND, INC.
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED OCTOBER 31,
------------------------------
1993 1994
------------ ------------
<S> <C> <C>
OPERATIONS:
Investment income_net................................................... $ 3,813,361 $ 5,021,825
Net realized gain (loss) on investments................................. 1,346,006 (1,108,323)
Net unrealized appreciation (depreciation) on investments for the year.. 5,953,464 (23,241,389)
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS....... 11,112,831 (19,327,887)
------------ ------------
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income_net................................................... (3,664,204) (4,973,199)
Net realized gain on investments........................................ (38,126) (1,583,630)
------------ ------------
TOTAL DIVIDENDS....................................................... (3,702,330) (6,556,829)
------------ ------------
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold........................................... 87,326,728 21,670,447
Dividends reinvested.................................................... 3,593,205 6,267,926
Cost of shares redeemed................................................. (17,356,547) (48,302,007)
------------ ------------
INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL STOCK TRANSACTIONS..... 73,563,386 (20,363,634)
------------ ------------
TOTAL INCREASE (DECREASE) IN NET ASSETS........................... 80,973,887 (46,248,350)
NET ASSETS:
Beginning of year....................................................... 36,861,343 117,835,230
------------ ------------
End of year (including undistributed investment income_net:
$263,064 in 1993 and $311,690 in 1994)................................ $117,835,230 $ 71,586,880
============ =============
SHARES SHARES
------------ ------------
CAPITAL SHARE TRANSACTIONS:
Shares sold............................................................. 6,150,709 1,734,060
Shares issued for dividends reinvested.................................. 249,390 509,209
Shares redeemed......................................................... (1,204,315) (3,914,083)
------------ ------------
NET INCREASE (DECREASE) IN SHARES OUTSTANDING......................... 5,195,784 (1,670,814)
============ =============
See notes to financial statements.
</TABLE>
DREYFUS EDISON ELECTRIC INDEX FUND, INC.
FINANCIAL HIGHLIGHTS
Reference is made to page 3 of the Fund's Prospectus dated
February 28, 1995.
See notes to financial statements.
DREYFUS EDISON ELECTRIC INDEX FUND, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 1_SIGNIFICANT ACCOUNTING POLICIES:
Wells Fargo Nikko Investment Advisors ("WFNIA") serves as the Fund's
index manager. WFNIA is a registered investment adviser. Wells Fargo
Institutional Trust Company, N.A. an affiliate of WFNIA, is the custodian of
the Fund's investments. The Dreyfus Corporation ("Dreyfus") serves as the
Fund's administrator. Dreyfus Service Corporation, a wholly-owned subsidiary
of Dreyfus, until August 24, 1994, acted as the exclusive distributor of the
Fund's shares, which are sold without a sales charge. Effective August 24,
1994, Dreyfus became a direct subsidiary of Mellon Bank, N.A.
On August 24, 1994, Premier Mutual Fund Services, Inc. (the
"Distributor") was engaged as the Fund's distributor. The Distributor,
located at One Exchange Place, Boston, Massachusetts 02109, is a wholly-owned
subsidiary of Institutional Administration Services, Inc., a provider of
mutual fund administration services, the parent company of which is Boston
Institutional Group, Inc.
(A) PORTFOLIO VALUATION: Investments in securities (including financial
futures) are valued at the last sales price on the securities exchange on
which such securities are primarily traded or at the last sales price on the
national securities market. Securities not listed on an exchange or the
national securities market, or securities for which there were no
transactions, are valued at the average of the most recent bid and asked
prices. Bid price is used when no asked price is available. Short-term
investments are carried at amortized cost, which approximates value.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities
transactions are recorded on a trade date basis. Realized gain and loss from
securities transactions are recorded on the identified cost basis. Dividend
income is recognized on the ex-dividend date and interest income, including,
where applicable, amortization of discount on investments, is recognized on
the accrual basis.
(C) DIVIDENDS TO SHAREHOLDERS: Dividends are recorded on the ex-dividend
date. Dividends from investment income-net are declared and paid on a
quarterly basis. Dividends from net realized capital gain are normally
declared and paid annually, but the Fund may make distributions on a more
frequent basis to comply with the distribution requirements of the Internal
Revenue Code. To the extent that net realized capital gain can be offset by
capital loss carryovers, it is the policy of the Fund not to distribute such
gain.
(D) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to
qualify as a regulated investment company, if such qualification is in the
best interests of its shareholders, by complying with the applicable
provisions of the Internal Revenue Code, and to make distributions of taxable
income sufficient to relieve it from substantially all Federal income and
excise taxes.
The Fund has an unused capital loss carryover of approximately $512,000
available for Federal income tax purposes to be applied against future net
securities profits, if any, realized subsequent to October 31, 1994. If not
applied, the carryover expires in fiscal 2002.
NOTE 2_MANAGEMENT FEE, ADMINISTRATION FEE AND OTHER TRANSACTIONS WITH
AFFILIATES:
(A) Fees paid by the Fund pursuant to the provisions of an Index
Management Agreement with WFNIA and an Administration Agreement with Dreyfus
are payable monthly. WFNIA and Dreyfus receive annual fees of .10 of 1% and
.15 of 1%, respectively, of the average daily value of the Fund's net assets.
The agreements further provide that if the aggregate expenses of the Fund,
exclusive of interest, taxes,
DREYFUS EDISON ELECTRIC INDEX FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
brokerage and extraordinary expenses, exceed the expense limitation of any
state having jurisdiction over the Fund, the Fund may deduct from the fees to
be paid to each of WFNIA and Dreyfus, or WFNIA and Dreyfus will each bear,
such excess expense in proportion to their respective fees. The most
stringent state expense limitation applicable to the Fund presently requires
reimbursement of expenses in any full fiscal year that such expenses exceed 21
/2% of the first $30 million, 2% of the next $70 million and 11/2% of the
excess over $100 million of the average value of the Fund's net assets in
accordance with California "blue sky" regulations. There was no expense
reimbursement for the year ended October 31, 1994.
(B) Pursuant to the Fund's Shareholder Services Plan, the Fund reimburses
Dreyfus Service Corporation an amount not to exceed an annual rate of .25 of
1% of the value of the Fund's average daily net assets for servicing
shareholder accounts. The services provided may include personal services
relating to shareholder accounts, such as answering shareholder inquiries
regarding the Fund and providing reports and other information, and services
related to the maintenance of shareholder accounts. During the year ended
October 31, 1994, the Fund was charged an aggregate of $221,890 pursuant to
the Shareholder Services Plan.
(C) Prior to August 24, 1994, certain officers and directors of the Fund
were "affiliated persons," as defined in the Act, of Dreyfus. Each director
who is not an "affiliated person" receives an annual fee of $2,500 and an
attendance fee of $500 per meeting.
NOTE 3_SECURITIES TRANSACTIONS:
The aggregate amount of purchases and sales of investment securities,
other than short-term securities, for the year ended October 31, 1994
amounted to $7,920,790 and $30,769,922, respectively.
At October 31, 1994, accumulated net unrealized depreciation on
investments was $16,654,567, consisting of $11,894 gross unrealized
appreciation and $16,666,461 gross unrealized depreciation.
At October 31, 1994, the cost of investments for Federal income tax
purposes was substantially the same as the cost for financial reporting
purposes (see the Statement of Investments).
DREYFUS EDISON ELECTRIC INDEX FUND, INC.
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE SHAREHOLDERS AND BOARD OF DIRECTORS OF
DREYFUS EDISON ELECTRIC INDEX FUND, INC.:
We have audited the accompanying statement of assets and liabilities of
Dreyfus Edison Electric Index Fund, Inc. (the Fund), including the statement
of investments, as of October 31, 1994, the related statement of operations
for the year then ended, the statement of changes in net assets for each of
the two years in the period then ended, and the financial highlights for each
of the two years in the period then ended and for the period from December 6,
1991 (commencement of operations) to October 31, 1992. 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 audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of October 31, 1994, by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits provide
a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of Dreyfus Edison Electric Index Fund, Inc. as of October 31, 1994,
the results of its operations, the changes in its net assets and the
financial highlights for the periods referred to above, in conformity with
generally accepted accounting principles.
COOPERS & LYBRAND, L.L.P.
New York, New York
December 13, 1994
