DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS INC, 485APOS, 1999-01-29

DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS INC
485APOS, 1999-01-29

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<PAGE>

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM N-1A

File No. 33-41034
File No. 811-6324

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 /X/

Pre-Effective Amendment No.
/ /

Post-Effective Amendment No. 20 /X/

AND

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 /X/

Amendment No. 20

DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS, INC.

(Exact Name of Registrant as Specified in Charter)

1818 Market Street, Philadelphia, Pennsylvania 19103

(Address of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number, including Area Code: (215) 255-2923
--------------

George M. Chamberlain, Jr., 1818 Market Street, Philadelphia, PA 19103

(Name and Address of Agent for Service)

Approximate Date of Public Offering: March 30, 1999
--------------

It is proposed that this filing will become effective:

immediately upon filing pursuant to paragraph (b)
-----
on (date) pursuant to paragraph (b)
-----
60 days after filing pursuant to paragraph (a)(1)
-----
X on March 30, 1999 pursuant to paragraph (a)(1)
-----
75 days after filing pursuant to paragraph (a)(2)
-----
on (date) pursuant to paragraph (a)(2) of Rule 485

-----

<PAGE>

Title of Securities Being Registered

International Small Cap Fund A Class
International Small Cap Fund B Class
International Small Cap Fund C Class
International Small Cap Fund Institutional Class
Global Equity Fund A Class
Global Equity Fund B Class
Global Equity Fund C Class
Global Equity Fund Institutional Class
Global Bond Fund A Class
Global Bond Fund B Class
Global Bond Fund C Class
Global Bond Fund Institutional Class
Emerging Markets Fund A Class
Emerging Markets Fund B Class
Emerging Markets Fund C Class
Emerging Markets Fund Institutional Class
International Equity Fund A Class
International Equity Fund B Class
International Equity Fund C Class
International Equity Fund Institutional Class
Global Opportunities Fund A Class
Global Opportunities Fund B Class
Global Opportunities Fund C Class
Global Opportunities Fund Institutional Class
Latin America Fund A Class
Latin America Fund B Class
Latin America Fund C Class
Latin America Fund Institutional Class
New Europe Fund A Class
New Europe Fund B Class
New Europe Fund C Class
New Europe Fund Institutional Class

<PAGE>

--- C O N T E N T S ---

This Post-Effective Amendment No. 20 to Registration File No. 33-41034
includes the following:

1. Facing Page

2. Contents Page

3. Cross-Reference Sheets

4. Part A - Prospectus

5. Part B - Statement of Additional Information

6. Part C - Other Information

7. Signatures

<PAGE>

CROSS-REFERENCE SHEET

PART A

Location in Prospectuses

Global Opportunities Fund/
International Small Cap Fund/
New Europe Global Opportunities Fund/
Fund/ Latin International Small Cap/
America Fund New Europe
Class A Fund/Latin
Class B America Fund
Item No. Description Class C Institutional Class
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1 Front and Back Cover Pages Same Same

2 Risk/Return Summary: Fund profiles Fund profiles
Investments, Risks and Performance

3 Risk/Return Summary: Fund profiles Fund profiles
Fee Table

4 Investment Objectives, Principal Investment How we manage the Funds How we manage the Funds
Strategies, and Related Risks

5 Management's Discussion of Performance N/A N/A

6 Management, Organization, and Capital Who manages the Funds Who manages the Funds
Structure

7 Shareholder Information How to buy shares; How to buy shares;
How to redeem shares; How to redeem shares;
Special services; Dividends, distributions and
Dividends, distributions and taxes all under About your
taxes all under About your account
account

8 Distribution Arrangements Choosing a share class; How to About your account
reduce sales charges under
About your account

9 Financial Highlights Information Financial Highlights Financial Highlights

</TABLE>

<PAGE>

CROSS-REFERENCE SHEET

PART A

Location in Prospectuses

Global Bond Fund/
Global Equity Fund/
International Equity Global Bond Fund/
Fund/Emerging Global Equity Fund/
Markets Fund International Equity
Class A Fund/Emerging
Class B Markets Fund
Item No. Description Class C Institutional Class
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>

1 Front and Back Cover Pages Same Same

2 Risk/Return Summary: Fund profiles Fund profiles
Investments, Risks and Performance

3 Risk/Return Summary: Fund profiles Fund profiles
Fee Table

4 Investment Objectives, Principal Investment How we manage the Funds How we manage the Funds
Strategies, and Related Risks

5 Management's Discussion of Performance N/A N/A

6 Management, Organization, and Capital Who manages the Funds Who manages the Funds
Structure

8 Distribution Arrangements Choosing a share class; How to About your account
reduce sales charges under
About your account

9 Financial Highlights Information Financial Highlights Financial Highlights

</TABLE>
<PAGE>

CROSS-REFERENCE SHEET

PART B
<TABLE>
<CAPTION>

Global Bond Fund, International
Equity Fund, Emerging Markets
Fund, Global Equity Fund
Location in Statements
Item No. Description of Additional Information**
- -------- ----------- ---------------------------
<S> <C> <C>
10 Cover Page and Table of Contents Same

11 Fund History Fund History

12 Description of the Fund and Its Investments and Risks Investment Policies and
Portfolio Techniques

13 Management of the Fund Officers and Directors;
Purchasing Shares

14 Control Persons and Principal Holders of Securities Officers and Directors

15 Investment Advisory and Other Services Officers and Directors;
Purchasing Shares; Investment
Management Agreements and Sub-Advisory
Agreements;
General Information;
Financial Statements

16 Brokerage Allocation and Other Practices Trading Practices and Brokerage

17 Capital Stock and Other Securities General Information

18 Purchase, Redemption and Pricing of Shares Purchasing Shares; Redemption and
Exchange; Determining
Offering Price and Net Asset Value

19 Taxation of the Fund Accounting and Tax Issues; Distributions

20 Underwriters Purchasing Shares

21 Calculation of Performance Data Performance Information

22 Financial Statements Financial Statements

</TABLE>
<PAGE>

CROSS-REFERENCE SHEET

PART B
<TABLE>
<CAPTION>

Global Opportunities Fund,
International Small Caps Fund
New Europe Fund
Latin America Equity Fund
Location in Statements
Item No. Description of Additional Information**
- -------- ----------- ---------------------------
<S> <C> <C>
10 Cover Page and Table of Contents Same

11 Fund History Fund History

12 Description of the Fund and Its Investments and Risks Investment Policies and
Portfolio Techniques

13 Management of the Fund Officers and Directors;
Purchasing Shares

14 Control Persons and Principal Holders of Securities Officers and Directors

15 Investment Advisory and Other Services Officers and Directors;
Purchasing Shares; Investment
Management Agreements and Sub-Advisory
Agreements;
General Information;
Financial Statements

16 Brokerage Allocation and Other Practices Trading Practices and Brokerage

17 Capital Stock and Other Securities General Information

18 Purchase, Redemption and Pricing of Shares Purchasing Shares; Redemption and
Exchange; Determining
Offering Price and Net Asset Value

19 Taxation of the Fund Accounting and Tax Issues; Distributions

20 Underwriters Purchasing Shares

21 Calculation of Performance Data Performance Information

22 Financial Statements Financial Statements

</TABLE>
<PAGE>

CROSS-REFERENCE SHEET

PART C
<TABLE>
<CAPTION>

Item No. Description Location in Part C
-------- ----------- ------------------

<S> <C> <C>
23 Exhibits Item 23

24 Persons Controlled by or under Common
Control with Registrant Item 24

25 Indemnification Item 25

26 Business and Other Connections of the Investment Adviser Item 26

27 Principal Underwriters Item 27

28 Location of Accounts and Records Item 28

29 Management Services Item 29

30 Undertakings Item 30

</TABLE>

<PAGE>

DELAWARE
INVESTMENTS
-----------
Philadelphia * London

Global Opportunities Fund
(formerly Global Equity Fund)
* * *
International Small Cap Fund
* * *
New Europe Fund
* * *
Latin America Fund

Class A * Class B * Class C

Prospectus

[______________, 1999]

The Securities and Exchange Commission has not approved or disapproved these
securities or passed upon the accuracy of this prospectus, and any
representation to the contrary is a criminal offense.

<PAGE>

[inside front cover]

Table of Contents

Fund Profiles page
International Small Cap Fund
Global Opportunities Fund
New Europe Fund
Latin America Fund

Who manages the Funds page
Our investment strategies
The securities we typically invest in
The risks of investing in the Funds

Fund administration (Who's who?) page

About your account page
Investing in the Funds
Choosing a share class
How to reduce your sales charge
How to buy shares
Retirement plans
How to redeem shares
Account minimums
Special services
Dividends, Distributions and Taxes

Other investment policies and page
risk considerations

Financial information page

Bond ratings page

Glossary page

<PAGE>

How to use this prospectus

Here are guidelines to help you use this prospectus to make well-informed
investment decisions about our funds. If you're looking for a specific piece of
information, the table of contents can guide you directly to the appropriate
section.

Step 1
Take a look at the fund profiles for an overview of each Fund.

Step 2
Learn in-depth information about how the Funds invest, the risks involved and
the people and organizations responsible for the Funds' day-to-day operations.

Step 3
Determine which fund features and services you would like to take advantage of.

Step 4
Use the glossary that begins on page 6 to find definitions of words printed in
bold type in the text throughout the prospectus.

<PAGE>

Profile: Global Opportunities Fund*

What are the Fund's goals?

The Global Opportunities Fund's investment goal is to achieve long-term total
return. Although the Fund will strive to achieve its goal, there is no assurance
that it will.

What are the Fund's main investment strategies?
The Global Opportunities Fund seeks to achieve its objective by investing in
global securities that provide the potential for capital appreciation and
income. The Fund's primary focus is to invest in domestic and foreign equity
securities. Under normal market conditions, the Fund will invest at least 65% of
its assets in equity securities of issuers organized or having a majority of
their assets in or deriving a majority of their operating income in at least
three different countries, one which may be the United States.

What are the main risks of investing in the Fund?
Investing in any mutual fund involves risk, including the risk that you may lose
part or all of the money you invest. The price of Fund shares will increase and
decrease according to changes in the value of the Fund's investments. This Fund
will be affected primarily by declines in stock and bond prices that can be
caused by a drop in the stock or bond market, an adverse change in interest
rates or poor performance in specific industries or companies. Because the Fund
invests in international securities in both established and developing
countries, it will be affected by international investment risks related to
changes in currency valuations, political instability, economic instability, or
less regulatory standards. The Fund is considered "non-diversified" under
federal laws and regulations that regulate mutual funds. Thus, adverse effects
on the Fund's investments may affect a larger portion of its overall assets and
subject the Fund to greater risks. For a more complete discussion of risk,
please turn to page ___.

An investment in the Fund is not a deposit of any bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other
government agency.

You should keep in mind that an investment in the Fund is not a complete
investment program; it should be considered just one part of your total
financial plan. Be sure to discuss this Fund with your financial adviser to
determine whether it is an appropriate choice for you.

Who should invest in the Fund
o Investors with long-term financial goals (at least three years).
o Investors looking for a portfolio that includes both fixed-income
and equity securities from both U.S. and foreign countries.
o Investors seeking a measure of capital growth and income.

Who should not invest in the Fund
o Investors with short-term financial goals.
o Investors who are unwilling to accept risks of investing in
foreign equity securities.

* The Global Opportunities Fund was formerly known as Global Equity Fund.
The change in the Fund's name became effective on July 21, 1998.

<PAGE>

How has the Global Opportunities Fund performed?

This bar chart and table can help you evaluate the potential risks of investing
in the Fund. We show the returns for the Fund's Class A shares for the past
calendar year, as well as the average annual returns of all shares for the one
year period and since inception--all compared to the performance of the Morgan
Stanley World Index. You should remember that unlike the Fund, the index is
unmanaged and doesn't reflect the costs of operating a mutual fund, such as the
costs of buying, selling, and holding the securities. The Fund's past
performance is not necessarily an indication of how it will perform in the
future. The returns reflect voluntary expense caps. The returns would be lower
without the voluntary caps.

[GRAPHIC OMITTED: BAR CHART SHOWING TOTAL RETURN (CLASS A)]
Total return (Class A)

Global Opportunities Fund A Class Morgan Stanley World Index 1998

As of December 31, 1998, the Fund's Class A shares had a year-to-date return of
______%. During the period illustrated in this bar chart, Class A's highest
return was ____% for the quarter ended [DATE] and its lowest return was ____%
for the quarter ended [DATE].

The maximum Class A sales charge of 5.75%, which is normally deducted when you
purchase shares, is not reflected in the total returns above. If this fee were
included, the returns would be less than those shown. The average annual returns
shown on page ___ do include the sales charge.

How has the Global Opportunities Fund performed? (continued)

[table]
Average annual returns for periods ending 12/31/98

Morgan Stanley
CLASS A World Index
---------- --------- --------------

1 year
Since inception
(7/21/97)

<PAGE>

What are the Global Opportunities Fund's fees and expenses?
Sales charges are fees paid directly from your investments when you buy or sell
shares of the Fund. The Fund may waive or reduce sales charges; please see the
Statement of Additional Information for details.

- --------------------------------------------------------------------------------
CLASS A B C
- --------------------------------------------------------------------------------
Maximum sales charge (load) imposed on
purchases as a percentage of offering price 5.75% none none
- --------------------------------------------------------------------------------
Maximum contingent deferred sales charge (load)
as a percentage of original purchase price or
redemption price, whichever is lower none(1) 5%(2) 1%(3)
- --------------------------------------------------------------------------------
Maximum sales charge (load) imposed on
reinvested dividends none none none
- --------------------------------------------------------------------------------
Redemption fees none none none
- --------------------------------------------------------------------------------

Annual fund operating expenses are deducted from the Fund's assets before it
pays dividends and before its net asset value and total return are calculated.
We will not charge you separately for these expenses. These expenses are based
on amounts incurred during the Fund's most recent fiscal year.

- --------------------------------------------------------------------------------
CLASS A B C
- --------------------------------------------------------------------------------
Management fees
- --------------------------------------------------------------------------------
Distribution and service (12b-1) fees(4)
- --------------------------------------------------------------------------------
Other expenses
- --------------------------------------------------------------------------------
Total operating expenses(5)
- --------------------------------------------------------------------------------

This example is intended to help you compare the cost of investing in the Fund
to the cost of investing in other mutual funds with similar investment
objectives. We show the cumulative amount of Fund expenses on a hypothetical
investment of $10,000 with an annual 5% return over the time shown.(6) This is
an example only, and does not represent future expenses, which may be greater or
less than those shown here.

- --------------------------------------------------------------------------------
CLASS(7) A B B C C
(no redemption) (no redemption)
- --------------------------------------------------------------------------------
1 year
- --------------------------------------------------------------------------------
3 years
- --------------------------------------------------------------------------------
5 years
- --------------------------------------------------------------------------------
10 years
- --------------------------------------------------------------------------------

1. A purchase of Class A shares of $1 million or more may be made at net asset
value. However, if you buy the shares through a financial adviser who is paid
a commission, a contingent deferred sales charge will apply to certain
redemptions. Additional Class A purchase options that involve a contingent
deferred sales charge may be permitted from time to time and will be
disclosed in the prospectus if they are available.

<PAGE>

2. If you redeem Class B shares during the first year after you buy them, you
will pay a contingent deferred sales charge of 5%, which declines to 4%
during the second year, 3% during the third and fourth years, 2% during the
fifth year, 1% during the sixth year, and 0% thereafter.

3. Class C shares redeemed within one year of purchase are subject to a 1%
contingent deferred sales charge.

4. The Class A shares are subject to a 12b-1 fee of 0.30% of average daily net
assets and Class B and C shares are each subject to a 12b-1 fee of 1.00% of
average daily net assets. The distributor has agreed to waive these 12b-1
fees through May 31, 1999.

5. The investment manager has agreed to waive fees and pay expenses through May
31,1999, in order to prevent total operating expenses (excluding any taxes,
interest, brokerage fees, extraordinary expenses and 12b-1 fees) from
exceeding 0.80% of average daily net assets.

6. The Fund's actual rate of return may be greater or less than the hypothetical
5% return we use here. Also, this example assumes that the Fund's total
operating expenses remain unchanged in each of the periods we show. In
addition, this example does not reflect the voluntary expense cap described
in footnote 5.

7. The Class B example reflects the conversion of Class B shares to Class A
shares after approximately eight years. Information for the ninth and tenth
years reflects expenses of the Class A shares.

<PAGE>

Profile: International Small Cap Fund

What are the Fund's goals?
International Small Cap Fund seeks long-term capital appreciation. Although, the
Fund will strive to achieve its goal, there is no assurance that it will.

What are the Fund's main investment strategies?
International Small Cap Fund seeks to achieve its objective by investing
primarily in smaller non-U.S. companies, which may include companies located or
operating in established or emerging countries. Under normal circumstances, at
least 65% of the Fund's total assets will be invested in equity securities of
companies organized or having a majority of their assets in or deriving a
majority of their operating income in at least three different countries outside
of the United States. The current market capitalization of the companies in
which the Fund intends to invest primarily will generally be $1.5 billion or
less (at the time of purchase).

What are the main risks of investing in the Fund?
Investing in any mutual fund involves risk, including the risk that you may lose
part or all of the money you invest. The price of Fund shares will increase and
decrease according to changes in the value of the Fund's investments. This Fund
will be affected primarily by declines in stock and bond prices which can be
caused by a drop in the stock or bond market, an adverse change in interest
rates or poor performance in specific industries or companies. Investments in
foreign securities whether equity or fixed-income, involve special risks
including those related to currency fluctuations, as well as to political,
economic and social situations different from and potentially more volatile than
those in the U.S. In addition, the accounting, tax and financial reporting
standards of foreign countries are different from and may be less reliable or
comprehensive than those relating to U.S. issuers. The Fund may invest up to 15%
of its net assets in high yield, high risk foreign fixed income securities,
which are subject to substantial risks, particularly during periods of economic
downturns or rising interest rates. For a more complete discussion of risk,
please turn to page __.

The Fund is not a deposit of any bank and is not insured or guaranteed by the
Federal Deposit Insurance Corporation (FDIC) or any other government agency.

You should keep in mind that an investment in the fund is not a complete
investment program; it should be considered just one part of your total
financial plan. Be sure to discuss this Fund with your financial adviser to
determine whether it is an appropriate choice for you.

Who should invest in the Fund?
o Investors with long-term financial goals.
o Investors looking for growth potential from a portfolio of international
securities.
o Investors willing to accept the risks associated with foreign investing as
well as investments in smaller-sized issuers, some to which may be
speculative.

Who should not invest in the Fund o Investors with short-term financial goals.
o Investors who are unwilling to accept share prices that may fluctuate,
sometimes significantly, over the short term.
o Investors whose primary goal is income.

<PAGE>

What are the International Small Cap Fund's fees and expenses?
Sales charges are fees paid directly from your investments when you buy or sell
shares of the Fund. The Fund may waive or reduce sales charges; please see the
Statement of Additional Information for details.

- --------------------------------------------------------------------------------
CLASS A B C
- --------------------------------------------------------------------------------
Maximum sales charge (load) imposed on 5.75% None None
purchases as a percentage of offering price
- --------------------------------------------------------------------------------
Maximum contingent deferred sales charge None(1) 5%(2) 1%(3)
(load) as a percentage of original purchase
price or redemption price, whichever is lower
- --------------------------------------------------------------------------------
Maximum sales charge (load) imposed on None None None
reinvested dividends
- --------------------------------------------------------------------------------
Redemption fees None None None
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
CLASS A B C
- --------------------------------------------------------------------------------
Management fees
- --------------------------------------------------------------------------------
Distribution and service (12b-1) fees(4)
- --------------------------------------------------------------------------------
Other expenses
- --------------------------------------------------------------------------------
Total operating expenses(5)
- --------------------------------------------------------------------------------

<PAGE>

3. Class C shares redeemed within one year of purchase are subject to a 1%
contingent deferred sales charge.

7. The Class B example reflects the conversion of Class B shares to Class A
shares after approximately eight years. Information for the ninth and tenth
years reflects expenses of the Class A shares.

<PAGE>

Profile: New Europe Fund

What are the Fund's goals?
The New Europe Fund seeks long-term capital appreciation. Although, the Fund
will strive to achieve its goal, there is no assurance that it will.

What are the Fund's main investment strategies?
We invest primarily in equity securities of European Countries. Under normal
market conditions, at least 65% of New Europe's assets will be invested in
equity securities of companies organized or having a majority of their assets in
or deriving a majority of their operating income in Europe.

What are the main risks of investing in the Fund?
Investing in any mutual fund involves risk, including the risk that you may lose
part or all of the money you invest. The price of Fund shares will increase and
decrease according to changes in the value of the Fund's investments. This Fund
will be affected primarily by declines in stock and bond prices which can be
caused by a drop in the stock or bond market, an adverse change in interest
rates or poor performance in specific industries or companies. The New Europe
Fund targets a specific region of the world for investment. Thus, an investment
in this Fund will likely be more volatile than a more geographically diversified
fund. In addition, the performance of this Fund is closely tied to the economic
and political conditions of the region. The Fund may invest up to 30% of its net
assets in high yield, high risk foreign fixed income securities, which are
subject to substantial risks, particularly during periods of economic downturns
or rising interest rates. For a more complete discussion of risk, please turn to
page __.

An investment in the Fund is not a deposit of any bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other
government agency.

Who should invest in the Fund?
o Investors with long-term financial goals.
o Investors looking for growth potential.
o Investors willing to accept the risks associated with foreign investing as
well as investments in smaller-sized issuers, some to which may be
speculative.

Who should not invest in the Fund
o Investors with short-term financial goals.
o Investors who are unwilling to accept share prices that may fluctuate,
sometimes significantly, over the short term.
o Investors whose primary goal is income.

<PAGE>

What are the New Europe Fund's fees and expenses?

Sales charges are fees paid directly from your investments when you buy or sell
shares of the Fund. The Fund may waive or reduce sales charges; please see the
Statement of Additional Information for details.

- --------------------------------------------------------------------------------
CLASS A B C
- --------------------------------------------------------------------------------
Maximum sales charge (load) imposed on 5.75% None None
purchases as a percentage of offering price
- --------------------------------------------------------------------------------
Maximum contingent deferred sales charge none(1) 5%(2) 1%(3)
(load) as a percentage of original purchase
price or redemption price, whichever is lower
- --------------------------------------------------------------------------------
Maximum sales charge (load) imposed on None None None
reinvested dividends
- --------------------------------------------------------------------------------
Redemption fees None None None
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
CLASS A B C
- --------------------------------------------------------------------------------
Management fees
- --------------------------------------------------------------------------------
Distribution and service (12-1) fees(4)
- --------------------------------------------------------------------------------
Other expenses(5)
- --------------------------------------------------------------------------------
Total operating expenses(6)
- --------------------------------------------------------------------------------

This example is intended to help you compare the cost of investing in the Fund
to the cost of investing in other mutual funds with similar investment
objectives. We show the cumulative amount of Fund expenses on a hypothetical
investment of $10,000 with an annual 5% return over the time shown.(7) This is
an example only, and does not represent future expenses, which may be greater or
less than those shown here.

- --------------------------------------------------------------------------------
CLASS(8) A B B C C
(if redeemed) (if redeemed)
- --------------------------------------------------------------------------------
1 year
- --------------------------------------------------------------------------------
3 years
- --------------------------------------------------------------------------------

<PAGE>

3. Class C shares redeemed within one year of purchase are subject to a 1%
contingent deferred sales charge.

5. Other expenses are based on estimated amounts for the current fiscal year.

6. The investment manager has agreed to waive fees and pay expenses through May
31, 1999 in order to prevent total operating expenses (excluding any taxes,
interest, brokerage fees, extraordinary expenses and 12b-1 fees) from
exceeding 1.25% of average daily net assets.

7. The Fund's actual rate of return may be greater or less than the hypothetical
5% return we use here. Also, this example assumes that the Fund's total
operating expenses remain unchanged in each of the periods we show. In
addition, this example does not reflect the voluntary expense cap described
in footnote 6.

8. Class B shares automatically convert to Class A shares at the end of the
eighth year. The example does not assume this conversion since it only
reflects expenses for one and three years.

<PAGE>

Profile: Latin America Fund

What are the Fund's goals?
The Latin America Fund seeks long-term capital appreciation. Although, the Fund
will strive to achieve its goal, there is no assurance that it will.

What are the Fund's main investment strategies?
We invest primarily in equity securities of Latin American companies. Under
normal market conditions, at least 65% of Latin America's assets will be
invested in equity securities of companies organized or having a majority of
their assets in or deriving a majority of their operating income in Latin
America.

What are the main risks of investing in the Fund?
Investing in any mutual fund involves risk, including the risk that you may lose
part or all of the money you invest. The price of Fund shares will increase and
decrease according to changes in the value of the Fund's investments. This Fund
will be affected primarily by declines in stock and bond prices which can be
caused by a drop in the stock or bond market, an adverse change in interest
rates or poor performance in specific industries or companies. The Latin America
Fund targets a specific region of the world for investment. Therefore, an
investment in this Fund will likely be more volatile than a more geographically
diversified fund. In addition, the performance of this Fund is tied to the
economic and political conditions of this region.The Fund may invest up to 30%
of its net assets in high yield, high risk foreign fixed income securities,
which are subject to substantial risks, particularly during periods of economic
downturns or rising interest rates.

For a more complete discussion of risk, please turn to page __.

An investment in the Fund is not a deposit of any bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency.

Who should not invest in the Fund
o Investors with short-term financial goals.
o Investors whose primary goal is income.
o Investors who are unwilling to accept share prices that may fluctuate,
sometimes significantly, over the short term.

<PAGE>

What are the Fund's fees and expenses?
Sales charges are fees paid directly from your investments when you buy or sell
shares of the Fund. The Fund may waive or reduce sales charges; please see the
Statement of Additional Information for details.

- --------------------------------------------------------------------------------
CLASS A B C
- --------------------------------------------------------------------------------
Maximum sales charge (load) imposed on 5.75% None None
purchases as a percentage of offering price
- --------------------------------------------------------------------------------
Maximum contingent deferred sales charge none(1) 5%(2) 1%(3)
(load) as a percentage of original purchase
price or redemption price, whichever is lower
- --------------------------------------------------------------------------------
Maximum sales charge (load) imposed on None None None
reinvested dividends
- --------------------------------------------------------------------------------
Redemption fees None None None
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
CLASS A B C
- --------------------------------------------------------------------------------
Management fees
- --------------------------------------------------------------------------------
Distribution and service (12-1) fees(4)
- --------------------------------------------------------------------------------
Other expenses(5)
- --------------------------------------------------------------------------------
Total operating expenses(6)
- --------------------------------------------------------------------------------

This example is intended to help you compare the cost of investing in the Fund
to the cost of investing in other mutual funds with similar investment
objectives. We show the cumulative amount of Fund expenses on a hypothetical
investment of $10,000 with an annual 5% return over the time shown.(7) This is
an example only, and does not represent future expenses, which may be greater or
less than those shown here.

<PAGE>

3. Class C shares redeemed within one year of purchase are subject to a 1%
contingent deferred sales charge.

5. Other expenses are based on estimated amounts for the current fiscal year.

6. The investment manager has agreed to waive fees and pay expenses
through May 31, 1999 in order to prevent total operating expenses (excluding
any taxes, interest, brokerage fees, extraordinary expenses and 12b-1 fees)
from exceeding 1.25% of average daily net assets.

8. Class B shares automatically convert to Class A shares at the end of the
eighth year. The example does not assume this conversion since it only
reflects expenses for one and three years.

<PAGE>

How we manage the Funds

We take a disciplined approach to investing, combining investment strategies and
risk management techniques that can help shareholders meet their goals.

Our investment strategy

Global Opportunities Fund

Global Opportunities Fund's primary objective is long-term total return. The
Fund seeks to achieve its objective by investing in global securities that
provide the potential for capital appreciation and income. The Fund's primary
focus will be to invest in domestic and foreign equity securities and, under
normal market conditions, at least 65% of its assets will be invested in equity
securities. The Fund's investments will be made in securities of issuers
organized or having a majority of their assets in or deriving a majority of
their operating income in at least three different countries, one of which may
be the United States.

The Fund will attempt to achieve its investment objective by investing in a
broad range of equity and fixed-income securities. In selecting securities for
investments for the Fund, the Manager will consider an issuer's competitive
position, cost structure and liquidity. Equity securities in which the Fund may
invest include convertible securities, common stocks, preferred stocks and
warrants issued in foreign countries or in the U.S. In selecting equity
securities in which the Fund may invest, the Manager will use a dividend
discount analysis and a purchasing power parity approach. With a dividend
discount analysis, the Manager looks at future anticipated dividends and
discounts the value of those dividends back to what they would be worth if they
were being paid today. The Manager uses this technique to attempt to compare the
value of different investments. With a purchasing power parity approach, the
Manager attempts to identify the amount of goods and services that a dollar will
buy in the United States and compare that to the amount of a foreign currency
required to buy the same amount of goods and services in another country.
Eventually, currencies should trade at levels that should make it possible for
the dollar to buy the same amount of goods and services overseas as in the
United States. When the dollar buys less, the foreign currency may be considered
to be overvalued. Conversely, when the dollar buys more, the currency may be
considered to be undervalued.

The Fund may seek to achieve growth through investment of up to 35% of its
assets in income producing debt securities such as U.S. or foreign government or
corporate bonds. In addition, for temporary defensive purposes, the Fund may
invest all or a substantial portion of its assets in high quality debt
instruments issued by foreign governments, their agencies, instrumentalities or
political subdivisions, the U.S. government, its agencies or instrumentalities
(and which are backed by the full faith and credit of the U.S. government), or
issued by foreign or U.S. companies. For example, the Fund may invest in U.S.
fixed-income markets when the Manager believes that the global equity markets
are excessively volatile or overvalued so that the Fund's objective cannot be
achieved in such markets. Any corporate debt obligations will be rated AA or
better by S&P, Aa or better by Moody's, or have an equivalent rating from
another nationally recognized statistical rating organization, or if unrated,
determined by the Manager to be of comparable quality. The Fund may also invest
in the securities listed above pending investment of proceeds from new sales of
Fund shares and to maintain sufficient cash to meet redemption requests.

While the Fund may purchase securities in any foreign country, developed and
underdeveloped, or emerging market countries, it is currently anticipated that
the countries in which the Fund may invest will include, but are not limited to
Canada, Germany, the United Kingdom, France, the Netherlands, Belgium, Spain,
Switzerland, Japan, Australia, Hong Kong and Singapore/Malaysia, as well as
Indonesia, Korea, the Philippines, Taiwan, Thailand and South Africa. In certain
countries, investments may only be made by purchasing shares of closed-end
investment companies that in turn are authorized to invest in the securities of
such countries.

<PAGE>

International Small Cap Fund

The Fund seeks long-term capital appreciation. The Fund seeks to achieve its
objective by investing primarily in equity securities of smaller non-U.S.
companies, which may include companies located or operating in established or
emerging countries. Under normal circumstances, at least 65% of the Fund's total
assets will be invested in equity securities of companies organized or having a
majority of their assets in or deriving a majority of their operating income in
at least three different countries outside of the United States. The current
market capitalization of the companies in which the Fund intends to invest
primarily will generally be $1.5 billion or less (at the time of purchase).

The equity securities in which the Fund may invest include common stocks,
preferred stocks, rights or warrants to purchase common stocks and securities
convertible into common stocks. The Fund may also invest in foreign companies
through sponsored or unsponsored Depositary Receipts, which are receipts
typically issued by a bank or trust company evidencing ownership of underlying
securities issued by a foreign company. By focusing on smaller, non-U.S.
companies, the Fund seeks to identify equity securities of emerging and other
growth-oriented companies which in the opinion of the manager, are responsive to
changes within their markets, and have the fundamental characteristics to
support growth. The manager will seek to identify changing and dominant trends
within the relevant markets, and will purchase securities of companies which it
believes will benefit from these trends. In addition, the manager will consider
the financial strength of the company, the nature of its management, and any
developments affecting the company or its industry. The manager may invest in
smaller capitalization companies that may be temporarily out of favor or
overlooked by securities analysts and whose value, therefore, may not yet be
fully recognized by the market.

While the Fund may purchase securities in any foreign country, developed and
underdeveloped, or emerging market countries, it is currently anticipated that
the countries in which the Fund may invest will include, but not be limited to,
Canada, Germany, the United Kingdom, France, the Netherlands, Belgium, Spain,
Switzerland, Japan, Australia, New Zealand, Hong Kong, Singapore and Malaysia as
well as Argentina, Brazil, Chile, Egypt, Greece, India, Indonesia, Korea, Peru,
the Philippines, South Africa, Taiwan, Thailand and Turkey. With respect to
certain countries, investments by an investment company may only be made through
investments in closed-end investment companies that in turn are authorized to
invest in the securities of such countries.

In selecting investments for the Fund, the manager will employ a dividend
discount analysis across country boundaries and will also use a purchasing power
parity approach to identify currencies and markets that are overvalued or
undervalued relative to the U.S. dollar. The manager uses the dividend discount
analysis to compare the value of different investments. Using this technique,
the manager looks at future anticipated dividends and discounts the value of
those dividends back to what they would be worth if they were being paid today.
With a purchasing parity approach, the manager attempts to identify the amount
of goods and services that a dollar will buy in the United States and compare
that to the amount of a foreign currency required to buy the same amount of
goods and services in another country. Eventually, currencies should trade at
levels that should make it possible for the dollar to buy the same amount of
goods and services overseas as in the United States. When the dollar buys less,
the foreign currency may be considered to be overvalued. Conversely, when the
dollar buys more, the currency may be considered to be undervalued.

The Fund may also invest in convertible preferred stocks that offer enhanced
yield features, such as Preferred Equity Redemption Cumulative Stock, and
certain other non-traditional equity securities.

The Fund may invest up to 15% of its net assets in fixed-income securities
issued by emerging country companies, and foreign governments, their agencies,
instrumentalities or political subdivisions, all of which may be high yield,
high risk fixed-income securities rated lower than BBB by S&P and Baa by Moody's
or, if unrated, are considered by the manager to be of equivalent quality and
which present special investment risks. See High Yield, High Risk Securities.

18
<PAGE>

will be rated AA or better by S&P, or Aa or better by Moody's, or if unrated,
will be determined to be of comparable quality by the Fund's investment manager.
The Fund may also invest in the securities listed above pending investment of
proceeds from new sales of Fund shares and to maintain sufficient cash to meet
redemption requests.

New Europe Fund

The investment objective of New Europe is to achieve long-term capital
appreciation. The Fund seeks to achieve its objective by investing primarily in
equity securities of European companies, which may include companies located or
operating in established or emerging European countries. Under normal
circumstances, at least 65% of the Fund's total assets will be invested in
equity securities of companies organized or having a majority of their assets in
or deriving a majority of their operating income in Europe. The companies in
which the Fund will invest will be of varying size.

The Fund may invest in securities of issuers located in any European country
where the investment manager believes that there is the potential for long-term
capital appreciation. The Fund may invest in the securities of issuers located
in European countries with well-established economies and securities markets or
in countries with emerging economies or securities markets or smaller securities
markets. In addition, if opportunities arise, the Fund may invest in securities
of issuers located in Eastern European countries.

In selecting investments for the New Europe Fund, the investment manager will
employ a dividend discount analysis across country boundaries and will also use
a purchasing power parity approach to identify currencies and markets that are
overvalued or undervalued relative to the U.S. dollar. The investment manager
uses the dividend discount analysis, based on available information, to compare
the value of different investments. Using this technique, the investment manager
looks at future anticipated dividends and discounts the value of those dividends
back to what they would be worth if they were being paid today. Because many of
the countries in which the Fund invests are emerging countries, there may be
less information available on which the investment manager can base its dividend
discount analysis. Thus, such analysis may not be as complete as a dividend
discount analysis performed on investments in developed countries.

With a purchasing parity approach, the investment manager attempts to identify
the amount of goods and services that a dollar will buy in the United States and
compare that to the amount of a foreign currency required to buy the same amount
of goods and services in another country. Eventually, currencies should trade at
levels that should make it possible for the dollar to buy the same amount of
goods and services overseas as in the United States. When the dollar buys less,
the foreign currency may be considered to be overvalued. When the dollar buys
more, the currency may be considered to be undervalued.

The Fund may invest up to 30% of its net assets in fixed-income securities
issued by emerging country companies, and foreign governments, their agencies,
instrumentalities or political subdivisions, all of which may be high yield,
high risk fixed-income securities, including Brady Bonds, rated lower than BBB
by S&P and Baa by Moody's or, if unrated, are considered by the investment
manager to be of equivalent quality and which present special investment risks.
See High Yield, High Risk Securities.

For temporary defensive purposes, New Europe Fund may invest all or a
substantial portion of their assets in high quality debt instruments issued by
foreign governments, their agencies, instrumentalities or political
subdivisions, supernational organizations, the U.S. government, its agencies or
instrumentalities (and which are backed by the full faith and credit of the U.S.
government), or issued by foreign or U.S. companies. Any such corporate debt
obligations will be rated AA or better by S&P, or Aa or better by Moody's, or if
unrated, will be determined to be of comparable quality by the investment
manager. The Fund may also invest in the securities listed above pending
investment of proceeds from new sales of Fund shares and to maintain sufficient
cash to meet redemption requests.

19
<PAGE>

Latin America Fund

The investment objective of Latin America is to achieve long-term capital
appreciation. The Fund seeks to achieve its objective by investing primarily in
equity securities of companies in Latin America, most of which are emerging
market countries. Under normal circumstances, at least 65% of the Fund's total
assets will be invested in equity securities of companies organized or having a
majority of their assets in or deriving a majority of their income in Latin
America. The companies in which the Fund will invest will be of varying size.
[Does this mean large and small capitalization?]

The Latin American countries in which the Fund may invest include Argentina,
Belize, Bolivia, Brazil, Chile, Columbia, Costa Rica, Cuba, Ecuador, El
Salvador, French Guyana, Guatemala, Guyana, Honduras, Mexico, Nicaragua, Panama,
Paraguay, Peru, Surinam, Trinidad/Tobago, Uruguay and Venezuela.

In selecting investments for the Latin America Fund, the investment manager will
employ a dividend discount analysis across country boundaries and will also use
a purchasing power parity approach to identify currencies and markets that are
overvalued or undervalued relative to the U.S. dollar. The investment manager
uses the dividend discount analysis, based on available information, to compare
the value of different investments. Using this technique, the investment manager
looks at future anticipated dividends and discounts the value of those dividends
back to what they would be worth if they were being paid today. Because many of
the countries in which the Funds invest are emerging countries, there may be
less information available on which the investment manager can base its dividend
discount analysis. Thus, such analysis may not be as complete as a dividend
discount analysis performed on investments in developed countries.

In addition, the Fund may invest up to 30% of its net assets in fixed-income
securities issued by emerging country companies, and foreign governments, their
agencies, instrumentalities or political subdivisions, all of which may be high
yield, high risk fixed-income securities rated lower than BBB S&P and Baa by
Moody's or, if unrated, are considered by the investment manager to be of
equivalent quality and which present special investment risks. See High Yield,
High Risk Securities.

For temporary defensive purposes, the Latin America Fund may invest all or a
substantial portion of their assets in high quality debt instruments issued by
foreign governments, their agencies, instrumentalities or political
subdivisions, supernational organizations, the U.S. government, its agencies or
instrumentalities (and which are backed by the full faith and credit of the U.S.
government), or issued by foreign or U.S. companies. Any such corporate debt
obligations will be rated AA or better by S&P, or Aa or better by Moody's, or if
unrated, will be determined to be of comparable quality by the investment
manager. The Fund may also invest in the securities listed above pending
investment of proceeds from new sales of Fund shares and to maintain sufficient
cash to meet redemption requests.

<PAGE>

- -----------------------------------------------------------------------------------------------------------------------------
Securities How we use them
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C>
Corporate Bonds: Debt obligations issued by a The Funds may invest in corporate bonds generally rated AA or better
corporation. by S&P and Aa by Moody's.
- -----------------------------------------------------------------------------------------------------------------------------
Common Stocks: Securities that represent shares of Consistent with their respective investment objective, certain Funds
ownership in a corporation. Stockholders participate will invest their assets in common stocks, as well as in dividend
in the corporation's profits and losses, paying stocks.
proportionate to the number of shares they own.
- -----------------------------------------------------------------------------------------------------------------------------
Foreign Currency Transactions: The Funds will Although the Funds value their assets daily in terms of U.S. dollars,
invest in securities of foreign issuers and may hold they do not intend to convert their holdings of foreign currencies
foreign currency. In addition, the Funds may enter into U.S. dollars on a daily basis. Each Fund will, however, from
into contracts to purchase or sell foreign time to time, purchase or sell foreign currencies and/or engage in
currencies at a future date (i.e., a "forward forward foreign currency transactions in order to expedite settlement
foreign currency contract" or "forward contract"). of portfolio transactions and to minimize currency value
A forward contract involves an obligation to fluctuations. Each Fund may conduct its foreign currency
purchase or sell a specific currency at a future transactions on a spot (i.e., cash) basis at the spot rate prevailing
date, which may be any fixed number of days from the in the foreign currency exchange market or through a forward foreign
date of the contract, agreed upon by the parties, at currency contract or forward contract. The Funds will convert
a price set at the time of the contract. A Fund may currency on a spot basis from time to time, and investors should be
enter into forward contracts to "lock-in" the price aware of the costs of currency conversion. By entering into these
of a security it has agreed to purchase or sell, in transactions, the Funds attempt to protect themselves against a
terms of U.S. dollars or other currencies in which possible loss resulting from an adverse change in currency exchange
the transaction will be consummated. rates during the period between when the security is purchased or
sold and the date on which payment is made or received.
- -----------------------------------------------------------------------------------------------------------------------------
Repurchase Agreements: An agreement between a buyer Typically, we use repurchase agreements as a short-term investment
and seller of securities in which the seller agrees for a Fund's cash position. In order to enter into these repurchase
to buy the securities back within a specified time agreements, the Fund must have collateral of at least 102% of the
at the same price the buyer paid for repurchase price.
them, plus an amount equal to an agreed upon
interest rate. Repurchase agreements are often
viewed as equivalent to cash.
- -----------------------------------------------------------------------------------------------------------------------------
American Depositary Receipts (ADRs): Certificates Each Fund may invest in sponsored and unsponsored ADR's that are
issued by a U.S. bank that represent a stated number actively traded in the United States.
of shares of a foreign corporation that the bank
holds in its vault. An ADR entitles the holder to
all dividends and capital gains earned by the
underlying foreign shares. An ADR is bought and sold
the same as U.S. securities.
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>

- -----------------------------------------------------------------------------------------------------------------------------
Securities How we use them
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C>
European Depositary Receipts (EDRs) and Global In conjunction with their investments in foreign securities, the
Depositary Receipts (GDRs): EDRs and GDRs are Funds may invest in sponsored and unsponsored EDRs and GDRs that are
receipts issued by non-U.S. banks or trust companies actively traded in the United States.
and foreign branches of U.S. banks that evidence
ownership of the underlying foreign or U.S.
securities. Sponsored EDRs or GDRs are issued
jointly by the issuer of the underlying security and
a Depositary, and unsponsored EDRs or GDRs are
issued without the participation of the issuer of
the deposited security.
- -----------------------------------------------------------------------------------------------------------------------------
Restricted Securities: Privately placed securities Each Fund, except for Global Opportunities Fund, may invest up to 15%
whose resale is restricted under securities law. of their assets in privately placed securities that are eligible for
resale only among certain institutional buyers without registration.
These are commonly known as "Rule 144A Securities." The Global
Opportunities may only invest up to 10% of their assets in these
securities.
- -----------------------------------------------------------------------------------------------------------------------------
Borrowing from Banks Each Fund may borrow money as a temporary measure for extraordinary
purposes or to facilitate redemptions. Each Fund will not borrow money
in excess of one-third of the value of its net assets.
- -----------------------------------------------------------------------------------------------------------------------------
Securities Lending: These transactions involve the Each Fund may loan up to 25% of its assets to qualified
loan of securities owned by the Fund to qualified broker/dealers or institutional investors. These transactions will
dealers and investors for their use relating to generate additional income for the Fund.
short-sales or other securities transactions.
- -----------------------------------------------------------------------------------------------------------------------------
Investment Company Securities Each Fund may invest in either closed-end or open-end investment
companies consistent with the 1940 Act requirements. These investments
involve an indirect payment of a portion of the expenses, including
advisory fees, of such other investment companies.
- -----------------------------------------------------------------------------------------------------------------------------
Brady Bonds: These are debt securities issued under International Small Cap Fund, New Europe Fund and Latin America Fund
the framework of the Brady Plan, an initiative may invest in Brady Bonds consistent with their respective investment
announced by the U.S. Treasury Secretary, Nicholas objective. We believe that the economic reforms undertaken by
F. Brady in 1989, as a mechanism for debtor nations countries in connection with the issuance of Brady Bonds makes the
to restructure their outstanding external debt of countries that have issued or have announced plans to issue
indebtedness (generally, commercial bank debt). Brady Bonds an attractive opportunity for investment.
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
22

<PAGE>

- -----------------------------------------------------------------------------------------------------------------------------
Risks How we strive to manage them
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C>
Market Risk is the risk that all or a majority of the We maintain a long-term investment approach and focus
securities in a certain market - like the stock or bond on stocks we believe can appreciate over an extended
market - will decline in value because of factors such as time frame regardless of interim market fluctuations.
economic conditions, future expectations or investor We do not try to predict overall stock market movements
confidence. and do not trade for short-term purposes.
- -----------------------------------------------------------------------------------------------------------------------------
Industry and Security Risk is the risk that the value of We limit the amount of the Fund's assets invested in
securities in a particular industry or the value of an any one industry and in any individual security. We
individual stock or bond will decline because of changing also follow a rigorous selection process before
expectations for the performance of that industry or for choosing securities for the Fund.
the individual company issuing the stock or bond.
- -----------------------------------------------------------------------------------------------------------------------------
Foreign Risk is the risk that foreign securities may be The Fund's will invest in securities of foreign issuers
adversely affected by political instability, changes in that normally are denominated in foreign currencies and
currency exchange rates, foreign economic conditions or may hold foreign currency directly. Investments in
inadequate regulatory and accounting standards. securities of non-United States issuers which are
Transaction costs may be higher. generally denominated in foreign currencies involve certain
risk and opportunity considerations not typically
associated with investing in United States companies. We
carefully evaluate the overall situations in the countries
where we invest in an attempt to reduce these risks.
- -----------------------------------------------------------------------------------------------------------------------------
Currency Risk is the risk that the value of a Fund's Each Fund may try to hedge its currency risk by
investments may be negatively affected by changes in purchasing foreign currency exchange contracts. By
foreign currency exchange rates, foreign economic agreeing to purchase or sell foreign securities at a
conditions or inadequate regulatory and accounting pre-set price on a future date, the Funds strive to
standards. protect the value of the stock they own from future
changes in currency rates. Each Fund will use forward
currency exchange contracts only for defensive measures,
not to enhance portfolio returns. However, there is no
assurance that a strategy such as this will be successful.
- -----------------------------------------------------------------------------------------------------------------------------
Emerging Markets Risk is the risk that there is the International Small Cap, New Europe and Latin America
possibility of expropriation, nationalization, Funds have the ability to invest in emerging market
confiscatory taxation, income earned or other special securities. By maintaining a long-term investment
taxes, foreign exchange restrictions, limitations on the approach, we believe we can appreciate regardless of
repatriation of income and capital from investments, interim political, social or economic instabilities.
defaults in foreign government debt, and economic,
political or social instability. In addition, in many
emerging markets, there is substantially less publicly
available information about issuers and the information
that is available tends to be of a lesser quality.
Economic markets and structures tend to be less mature
and diverse and the securities markets which are
subject to less government regulation or supervision
may also be smaller, less liquid and subject to greater
price volatility. Transaction costs may be higher.
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>

- -----------------------------------------------------------------------------------------------------------------------------
Risks How we strive to manage them
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C>
High Yield, High Risk Foreign Fixed-Income Securities are New Europe Fund and Latin America Fund may invest up to
those securities rated lower than BBB by S&P and Baa by 30% of their respective net assets in these
Moody's. Securities of this type are considered to be of securities. International Small Cap may invest up to
poor standing and predominantly speculative as the 15% of its net assets in these securities. These Funds
ability to repay interest and principal. will not purchase securities rated lower than C by S&P
or Ca by Moody's or, if unrated, considered to be of an
equivalent quality to such ratings by the Manager.
- -----------------------------------------------------------------------------------------------------------------------------
Region Risk is the risk associated with investing a With respect to the New Europe and Latin America Funds,
majority of the Fund's assets in a specific region of the we maintain a long-term approach and focus on stocks in
world. The Fund's performance will be dependent upon the the region we believe can appreciate over an extended
economic and financial strength and stability of the time frame.
region. An investment in the Fund is likely to be more
volatile than an investment in a more geographically
diverse fund.
- -----------------------------------------------------------------------------------------------------------------------------
Political Risk is the risk that countries or the entire We carefully evaluate the political situations in the
region where we may invest may experience political countries where we invest and take into account any
instability, which may cause greater fluctuation in the potential risks before we select securities for the
value of our investments due to changes in currency portfolios. However, there is no way to eliminate
exchange rates, governmental seizures or nationalization political risk when investing internationally.
of assets.
- -----------------------------------------------------------------------------------------------------------------------------
Information Risk is the possibility that foreign Each Fund conducts a great deal of fundamental research
companies are subject to different accounting, auditing on the companies that it invests in rather than relying
and financial reporting standards than U.S. companies. solely on information available through financial
There may be less information available about foreign reporting. We believe this will help us to better
issuers than domestic issuers. Furthermore, regulatory uncover any potential weaknesses in individual companies.
oversight of foreign issuers may be less stringent or
less consistently applied than in the U.S.
- -----------------------------------------------------------------------------------------------------------------------------
Portfolio Turnover rates reflect the amount of securities The Funds normally will not invest for short-term
that are replaced from the beginning of the year to the trading purposes. However, a fund may sell securities
end of the year by the Fund. The degree of portfolio without regard to the length of time they have been
activity may affect brokerage costs and other transaction held. Given each Fund's investment objective, it is
costs of the Fund, as well as taxes payable by anticipated that the portfolio turnover rate of each
shareholders that are subject to federal income tax. Fund will not exceed 100%.
- -----------------------------------------------------------------------------------------------------------------------------
Foreign Government Securities Risks involve the ability The Funds attempt to reduce the risks associated with
of a foreign government or government related issuer to investing in foreign governments by setting rating
make timely and ultimate payments on its external debt standards and by limiting the portion of portfolio
obligations. This ability to make payments will be assets that may be invested in such securities.
strongly influenced by the issuer's balance of payments,
including export performance, its access to international
credits and investments, fluctuations in interest rates
and the extent of its foreign reserves.
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>

For additional information about the Funds' investment policies and certain
risks associated with investments in certain types of securities including
purchasing put and call options, futures contracts and options thereon, and
options on foreign currencies, please see the Statement of Additional
Information.

<PAGE>

Who manages the Funds

The Funds are managed by Delaware International Advisers, Ltd. Delaware
International is affiliated with Delaware Management Company, Inc. Delaware
International makes investment decisions for the Funds, manages the Funds'
business affairs and provides daily administrative services. Delaware Management
is the sub-adviser to the Global Opportunities Fund. With overall supervision of
the manager, the sub-adviser manages the U.S. securities portion of
Opportunities Fund's portfolio and furnishes the Manager with investment
recommendations, asset allocation advice, research and other investment services
regarding U.S. securities.

For their services to the Global Opportunites Fund, the manager and sub-adviser
were paid an aggregate fee of 0.00% of average daily net assets of the Fund for
the last fiscal year.

For its services to the International Small Cap Fund, the manager is paid an
annual fee of 1.25% of the average daily net assets of the Fund.

For its services to each of the New Europe Fund and Latin America Fund, the
manager is paid an annual fee equal to 1.25% on the first $500 million of
average daily net assets; 1.20% on the next $500 million; 1.15% on the next $1.5
billion; and 1.10% on the average daily net assets in excess of $2.5 billion.

Portfolio Managers

Elizabeth A. Desmond assumed primary responsibility for making day-to-day
investment decisions for the Global Opportunities Fund on July 21, 1998. Prior
to joining Delaware International in 1991, Ms. Desmond was a Pacific Basin
equity analyst and senior portfolio manager at Hill Samuel Investment Advisers
Ltd. Robert L. Arnold, Vice President/Portfolio Manager for Global Funds, Inc.
assumed primary responsibility for making investment decisions for the U.S.
equity portion of the Global Opportunities Fund on July 21, 1998.

Clive A. Gillmore and Timothy W. Sanderson have primary responsibility for
making day-to-day investment decisions for the International Small Cap Fund, and
have co-managed the Fund since its inception. Mr. Gillmore joined Delaware
International in 1990 after eight years of investment experience. Prior to
joining Delaware he was a Pacific Basin equity analyst and senior portfolio
manager for Hill Samuel Investment Advisers Ltd. Mr. Sanderson joined Delaware
International in 1990 as Senior Portfolio Manager and Director. Prior to that,
he was an analyst and senior portfolio manager for Hill Samuel where he had
responsibility for Pacific Basin research and the management of international
institutional portfolios.

Nigel May, Richard Ginty and Joshua Brooks have primary responsibility for
making day-to-day investment decisions for New Europe Fund. Mr. May joined
Delaware International in 1991, assuming portfolio management responsibilities
and sharing analytical responsibilities for continental Europe. Prior to joining
Delaware, he spent five years with Hill Samuel Investment Advisers Ltd. Mr.
Ginty joined Delaware International in 1992, where his primary research focus is
the European equity markets. Prior to joining Delaware, his business experience
was with Kleinwort Benson Securities Limited. Mr. Brooks joined Delaware
International in 1991. Mr. Brooks first worked in equity market analysis and as
a Philadelphia liaison with Delaware International and thereafter joined
Delaware International's emerging markets team in London.

Robert Akester, Mr. Gillmore, and Mr. Brooks have primary responsibility for
making day-to-day investment decisions for Latin America Fund. Mr. Akester
joined Delaware International in 1996, after twenty-six years of investment
experience. Prior to joining Delaware, Mr. Akester was Director of Hill Samuel
Investment Advisers Ltd. where he had responsibility for significant overseas
clients and Far Eastern Markets.

<PAGE>

Who's who?

This diagram show the various organizations involved with managing,
administering and servicing the Delaware Investments funds.

Board of Directors
<TABLE>
<CAPTION>

<S> <C> <C> <C>
Investment Manager The Funds Custodian
Delaware International Advisers The Chase Manhattan Bank
Third Floor 4 Chase Metrotech Center
80 Cheapside Brooklyn, NY 11245
London, England EC2V 6EE

Sub-Adviser
Delaware Management Company
One Commerce Square
Philadelphia, PA 19103

Portfolio managers Distributor Service agent
(see page __ for details) Delaware Distributors, L.P. Delaware Service Company, Inc.
1818 Market Street 1818 Market Street
Philadelphia, PA 19103 Philadelphia, PA 19103
</TABLE>

Financial advisers

Shareholders

Board of directors A mutual fund is governed by a board of directors which has
oversight responsibility for the management of the fund's business affairs.
Directors establish procedures and oversee and review the performance of the
investment manager, the distributor and others that perform services for the
fund. At least 40% of the board of directors must be independent of the fund's
investment manager or distributor. These independent fund directors, in
particular, are advocates for shareholder interests.

Investment manager An investment manager is a company responsible for selecting
portfolio investments consistent with the objective and policies stated in the
mutual fund's prospectus. The investment manager places portfolio orders with
broker/dealers and is responsible for obtaining the best overall execution of
those orders. A written contract between a mutual fund and its investment
manager specifies the services the manager performs. Most management contracts
provide for the manager to receive an annual fee based on a percentage of the
fund's average daily net assets. The manager is subject to numerous legal
restrictions, especially regarding transactions between itself and the funds it
advises.

Sub-adviser A sub-adviser is a company generally responsible for the management
of the fund's assets. They are selected and supervised by the investment
manager.

Portfolio managers Portfolio managers are employed by the investment manager or
sub-adviser to make investment decisions for individual portfolios on a
day-to-day basis.

Custodian Mutual funds are legally required to protect their portfolio
securities and typically place them with a qualified bank custodian who
segregates fund securities from other bank assets.

Distributor Most mutual funds continuously offer new shares to the public
through distributors who are regulated as broker-dealers and are subject to
National Association of Securities Dealers, Inc. (NASD) rules governing mutual
fund sales practices.

<PAGE>

Service agent Mutual fund companies employ service agents (sometimes called
transfer agents) to maintain records of shareholder accounts, calculate and
disburse dividends and capital gains and prepare and mail shareholder statements
and tax information, among other functions. Many service agents also provide
customer service to shareholders.

Financial advisers Financial advisers provide advice to their clients--analyzing
their financial objectives and recommending appropriate funds or other
investments. Financial advisers are compensated for their services, generally
through sales commissions, and through 12b-1 and/or service fees deducted from
the fund's assets.

Shareholders Like shareholders of other companies, mutual fund shareholders have
specific voting rights, including the right to elect directors. Material changes
in the terms of a fund's management contract must be approved by a shareholder
vote, and funds seeking to change fundamental investment objectives or policies
must also seek shareholder approval.

<PAGE>

About your account

Investing in the Funds
You can choose from a number of share classes for the Fund. Because each share
class has a different combination of sales charges, fees, and other features,
you should consult your financial adviser to determine which class best suits
your investment goals and time frame.

Choosing a share class

Class A
o Class A shares have an up-front sales charge of up to 5.75% that you
pay when you buy the shares. The offering price for Class A shares
includes the front-end sales charge.

o If you invest $50,000 or more, your front-end sales charge will be
reduced.

o You may qualify for other reduced sales charges, as described in "How
to reduce your sales charge," and under certain circumstances the sales
charge may be waived; please see the Statement of Additional
Information.

o Absent 12b-1 fee waivers, Class A shares are also subject to an annual
12b-1 fee no greater than 0.30% of average daily net assets, which is
lower than the 12b-1 fee for Class B and Class C shares.

o Class A shares generally are not subject to a contingent deferred sales
charge.

Class B
o Class B shares have no up-front sales charge, so the full amount of
your purchase is invested in the Fund. However, you will pay a
contingent deferred sales charge if you redeem your shares within six
years after you buy them.

o Under certain circumstances the contingent deferred sales charge may be
waived; please see the Statement of Additional Information.

o For approximately eight years after you buy your Class B shares, absent
12b-1 fee waivers, they are subject to annual 12b-1 fees no greater
than 1% of average daily net assets, of which 0.25% are service fees
paid to the distributor, dealers or others for providing services and
maintaining accounts.

o Because of the higher 12b-1 fees, Class B shares have higher expenses
and any dividends paid on these shares are lower than dividends on
Class A shares.

o Approximately eight years after you buy them, Class B shares
automatically convert into Class A shares with a 12b-1 fee of no more
than 0.30%, which is currently being waived. Conversion may occur as
late as three months after the eighth anniversary of purchase, during
which time Class B's higher 12b-1 fees apply.

o You may purchase up to $250,000 of Class B shares at any one time. The
limitation on maximum purchases varies for retirement plans.

<PAGE>

Class C
o Class C shares have no up-front sales charge, so the full amount of
your purchase is invested in the Fund. However, you will pay a
contingent deferred sales charge if you redeem your shares within 12
months after you buy them.

o Under certain circumstances the contingent deferred sales charge may be
waived; please see the Statement of Additional Information.

o Absent 12b-1 fee waivers, Class C shares are subject to an annual 12b-1
fee which may not be greater than 1% of average daily net assets, of
which 0.25% are service fees paid to the distributor, dealers or others
for providing personal services and maintaining shareholder accounts.

o Because of the higher 12b-1 fees, Class C shares have higher expenses
and pay lower dividends than Class A shares.

o Unlike Class B shares, Class C shares do not automatically convert into
another class.

o You may purchase any amount less than $1,000,000 of Class C shares at
any one time. The limitation on maximum purchases varies for retirement
plans.

Each share class of the Fund has adopted a separate 12b-1 plan that allows it to
pay distribution fees for the sales and distribution of its shares. Because
these fees are paid out of the Fund's assets on an ongoing basis, over time
these fees will increase the cost of your investment and may cost you more than
paying other types of sales charges.

<PAGE>

Class A Sales Charges
<TABLE>
<CAPTION>

- -----------------------------------------------------------------------------------------------------
Amount of purchase Sales charge Sales charge as % of Dealer's commission as %
as % amount invested Of offering price
of offering price
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Less than $50,000 5.75% 6.08% 5.00%

$50,000 but 4.75% 5.03% 4.00%
Under $100,000

$100,000 but 3.75% 3.88% 3.00%
Under $250,000

$250,000 but 2.50% 2.52% 2.00%
Under $500,000

$500,000 but 2.00% 1.99% 1.60%
Under $1 million

</TABLE>

As shown below, there is no front-end sales charge when you purchase $1 million
or more of Class A shares. However, if your financial adviser is paid a
commission on your purchase, you may have to pay a limited contingent deferred
sales charge of 1% if you redeem these shares within the first year and 0.50% if
you redeem them within the second year.

- --------------------------------------------------------------------------------------------------
Amount of purchase Sales charge as % Sales charge as % Dealer's commission as %
of offering price of amount invested of offering price
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
$1,000,000 up to $5 None None 1.00%
million
- --------------------------------------------------------------------------------------------------
Next $20 million None None 0.50%
up to $25 million
- --------------------------------------------------------------------------------------------------
Amount over $25 million None None 0.25%
- --------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>

About your account continued

How to reduce your sales charge
We offer a number of ways to reduce or eliminate the sales charge on shares.
Please refer to the Statement of Additional Information for detailed information
and eligibility requirements. You can also get additional information from your
financial adviser. You or your financial adviser must notify us at the time you
purchase shares if you are eligible for any of these programs.

- ----------------------------------------------------------------------------------------------------------------------------
Program How it works Share class
A B C
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Letter of Intent Through a Letter of Intent you X Although the Letter of
agree to invest a certain Intent and Rights of
amount in Delaware Investment Accumulation do not apply
Funds (except money market to the purchase of Class
funds with no sales charge) B and C shares, you can
over a 13-month period to combine your purchase of
qualify for reduced front-end Class A shares with your
sales charges. purchase of B and C
shares to fulfill your
Letter of Intent or
qualify for Rights of
Accumulation.
- ----------------------------------------------------------------------------------------------------------------------------
Rights of accumulation You can combine your holdings X
or purchases of all funds in the
Delaware Investments family
(except money market funds with
no sales charge) as well as the
holdings and purchases of your
spouse and children under 21 to
qualify for reduced front-end
sales charges.
- ----------------------------------------------------------------------------------------------------------------------------
Reinvestment of redeemed shares Up to 12 months after you X Not available.
redeem shares, you can reinvest
the proceeds without paying a
front-end sales charge.
- ----------------------------------------------------------------------------------------------------------------------------
SIMPLE IRA, SEP IRA, SARSEP, Prototype These investment plans may X Not available.
Profit Sharing, Pension, 401(k), SIMPLE qualify for reduced sales
401(k), 403(b)(7), and 457 Retirement charges by combining the
Plans purchases of all members of the
group. Members of these groups
may also qualify to purchase
shares without a front-end sales
charge and a waiver of any
contingent deferred sales
charges.
- ----------------------------------------------------------------------------------------------------------------------------

</TABLE>
32

<PAGE>

How to buy shares

Through your financial adviser
Your financial adviser can handle all the details of purchasing shares,
including opening an account. Your adviser may charge a separate fee for this
service.

By mail
Complete an investment slip and mail it with your check, made payable to the
fund and class of shares you wish to purchase, to Delaware Investments, 1818
Market Street, Philadelphia, PA 19103-3682. If you are making an initial
purchase by mail, you must include a completed investment application (or an
appropriate retirement plan application if you are opening a retirement account)
with your check.

By wire
Ask your bank to wire the amount you want to invest to First Union Bank, ABA
#031201467, Bank Account number 2014 12893 4013. Include your account number and
the name of the fund in which you want to invest. If you are making an initial
purchase by wire, you must call us so we can assign you an account number.

By exchange
You can exchange all or part of your investment in one or more funds in the
Delaware Investments family for shares of other funds in the family. Please keep
in mind, however, that under most circumstances you are allowed to exchange only
between like classes of shares. To open an account by exchange, call the
Shareholder Service Center at 800o523o1918.

Through automated shareholder services
You can purchase or exchange shares through Delaphone, our automated telephone
service, or through our web site, www.delawarefunds.com. For more information
about how to sign up for these services, call our Shareholder Service Center at
800o523o1918.

<PAGE>

About your account (continued)

How to buy shares (continued)

Once you have completed an application, you can open an account with an initial
investment of $1,000--and make additional investments at any time for as little
as $100. If you are buying shares in an IRA or Roth IRA, under the Uniform Gifts
to Minors Act or the Uniform Transfers to Minors Act; or through an Automatic
Investing Plan, the minimum purchase is $250, and you can make additional
investments of only $25. The minimum for an Education IRA is $500. The minimums
vary for retirement plans other than IRAs, Roth IRAs or Education IRAs.

The price you pay for shares will depend on when we receive your purchase order.
If we or an authorized agent receives your order before the close of trading on
the New York Stock Exchange (normally 4:00 p.m. Eastern Time) on a business day,
you will pay that day's closing share price which is based on the Fund's net
asset value. If we receive your order after the close of trading, you will pay
the next business day's price. A business day is any day that the New York Stock
Exchange is open for business. Currently the Exchange is closed when the
following holidays are observed: New Year's Day, Martin Luther King, Jr.'s
Birthday, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor
Day, Thanksgiving and Christmas. We reserve the right to reject any purchase
order.

We determine the Fund's net asset value (NAV) per share at the close of trading
of the New York Stock Exchange each business day that the Exchange is open. We
calculate this value by adding the market value of all the securities and assets
in the Fund's portfolio, deducting all liabilities, and dividing the resulting
number by the number of shares outstanding. The result is the net asset value
per share. We price securities and other assets for which market quotations are
available at their market value. We price fixed-income securities on the basis
of valuations provided to us by an independent pricing service that uses methods
approved by the board of directors. Any fixed-income securities that have a
maturity of less than 60 days we price at amortized cost. We price all other
securities at their fair market value using a method approved by the board of
directors.

Retirement plans
In addition to being an appropriate investment for your Individual Retirement
Account (IRA), Roth IRA and Education IRA, shares in the Fund may be suitable
for group retirement plans. You may establish your IRA account even if you are
already a participant in an employer-sponsored retirement plan. For more
information on how shares in the Fund can play an important role in your
retirement planning or for details about group plans, please consult your
financial adviser, or call 800o523o1918.

<PAGE>

How to redeem shares

Through your financial adviser
Your financial adviser can handle all the details of redeeming your shares. Your
adviser may charge a separate fee for this service.

By mail
You can redeem your shares (sell them back to the fund) by mail by writing to:
Delaware Investments, 1818 Market Street, Philadelphia, PA 19103-3682. All
owners of the account must sign the request, and for redemptions of $50,000 or
more, you must include a signature guarantee for each owner. Signature
guarantees are also required when redemption proceeds are going to an address
other than the address of record on an account.

By telephone
You can redeem up to $50,000 of your shares by telephone. You may have the
proceeds sent to you by check, or, if you redeem at least $1,000 of shares, you
may have the proceeds sent directly to your bank by wire. Bank information must
be on file before you request a wire redemption.

By wire
You can redeem $1,000 or more of your shares and have the proceeds deposited
directly to your bank account the next business day after we receive your
request. If you request a wire deposit, the First Union Bank fee (currently
$7.50) will be deducted from your proceeds. Bank information must be on file
before you request a wire redemption.

Through automated shareholder services
You can redeem shares through Delaphone, our automated telephone service, or
through our web site, www.delawarefunds.com. For more information about how to
sign up for these services, call our Shareholder Service Center at 800o523o1918.

<PAGE>

About your account (continued)

How to redeem shares (continued)

If you hold your shares in certificates, you must submit the certificates with
your request to sell the shares. We recommend that you send your certificates by
certified mail.

When you send us a properly completed request to redeem or exchange shares, you
will receive the net asset value as determined on the business day we receive
your request. We will deduct any applicable contingent deferred sales charges.
You may also have to pay taxes on the proceeds from your sale of shares. We will
send you a check, normally the next business day, but no later than seven days
after we receive your request to sell your shares. If you purchased your shares
by check, we will wait until your check has cleared, which can take up to 15
days, before we send your redemption proceeds.

If you are required to pay a contingent deferred sales charge when you redeem
your shares, the amount subject to the fee will be based on the shares' net
asset value when you purchased them or their net asset value when you redeem
them, whichever is less. This arrangement assures that you will not pay a
contingent deferred sales charge on any increase in the value of your shares.
You also will not pay the charge on any shares acquired by reinvesting dividends
or capital gains. If you exchange shares of one fund for shares of another, you
do not pay a contingent deferred sales charge at the time of the exchange. If
you later redeem those shares, the purchase price for purposes of the contingent
deferred sales charge formula will be the price you paid for the original
shares--not the exchange price. The redemption price for purposes of this
formula will be the NAV of the shares you are actually redeeming.

Account minimum
If you redeem shares and your account balance falls below the required account
minimum of $1,000 ($250 for IRAs, Uniform Gift to Minors Act accounts or
accounts with automatic investing plans, $500 for Education IRAs) for three or
more consecutive months, you will have until the end of the current calendar
quarter to raise the balance to the minimum. If your account is not at the
minimum by the required time, you will be charged a $9 fee for that quarter and
each quarter after that until your account reaches the minimum balance. If your
account does not reach the minimum balance, the Fund may redeem your account
after 60 days' written notice to you.

<PAGE>

Special services
To help make investing with us as easy as possible, and to help you build your
investments, we offer the following special services.

Automatic Investing Plan
The Automatic Investing Plan allows you to make regular monthly investments
directly from your checking account.

Direct Deposit
With Direct Deposit you can make additional investments through payroll
deductions, recurring government or private payments such as social security or
direct transfers from your bank account.

Wealth Builder Option
With the Wealth Builder Option you can arrange automatic monthly exchanges
between your shares in one or more Delaware Investments funds. Wealth Builder
exchanges are subject to the same rules as regular exchanges (see below) and
require a minimum monthly exchange of $100 per fund.

Dividend Reinvestment Plan
Through our Dividend Reinvestment Plan, you can have your distributions
reinvested in your account or the same share class in another fund in the
Delaware Investments family. The shares that you purchase through the Dividend
Reinvestment Plan are not subject to a front-end sales charge or to a contingent
deferred sales charge. Under most circumstances, you may reinvest dividends only
into like classes of shares.

Exchanges
You can exchange all or part of your shares for shares of the same class in
another Delaware Investments fund without paying a sales charge and without
paying a contingent deferred sales charge at the time of the exchange. However,
if you exchange shares from a money market fund that does not have a sales
charge you will pay any applicable sales charges on your new shares. When
exchanging Class B and Class C shares of one fund for similar shares in other
funds, your new shares will be subject to the same contingent deferred sales
charge as the shares you originally purchased. The holding period for the CDSC
will also remain the same, with the amount of time you held your original shares
being credited toward the holding period of your new shares. You don't pay sales
charges on shares that you acquired through the reinvestment of dividends. You
may have to pay taxes on your exchange. When you exchange shares, you are
purchasing shares in another fund so you should be sure to get a copy of the
fund's prospectus and read it carefully before buying shares through an
exchange.

<PAGE>

Dividends, Distributions and Taxes

Dividends and capital gains, if any, are paid annually. We automatically
reinvest all dividends and any capital gains.

Tax laws are subject to change, so we urge you to consult you tax adviser about
your particular tax situation and how it might be affected by current law. The
tax status of your dividends from the Fund is the same whether you reinvest your
dividends or receive them in cash. Distributions from the Fund's long-term
capital gains are taxable as capital gains, while distributions from short-term
capital gains and net investment income are generally taxable as ordinary
income. Any capital gains may be taxable at different rates depending on the
length of time the Fund held the assets. In addition, you may be subject to
state and local taxes on distributions.

We will send you a statement each year by January 31 detailing the amount and
nature of all dividends and capital gains that you were paid for the prior year.
Distributions declared in October, November or December but paid in January are
taxable as if they were paid in December.

Global Funds, Inc. is required to withhold 31% of your taxable distributions and
proceed if you do not provide your correct taxpayer identification number (TIN)
or certify that your TIN is correct, or if the IRS instructs us to do so.

<PAGE>

Other investment policies and risk considerations

High Yield, High Risk Securities

The International Small Cap Fund, New Europe Fund and the Latin America Fund may
invest in high yield, high risk foreign fixed income securities. In the past, in
the opinion of the Manager, the high yields from these bonds have more than
compensated for their higher default rates. There can be no assurance, however,
that yields will continue to offset default rates on these bonds in the future.
The Manager intends to maintain an adequately diversified portfolio of stocks
and bonds. While diversification can help to reduce the effect of an individual
default on a Fund, there can be no assurance that diversification will protect a
Fund from widespread bond defaults brought about by a sustained economic
downturn.

Medium- and low-grade bonds held by each Fund may be issued as a consequence of
corporate restructurings, such as leveraged buy-outs, mergers, acquisitions,
debt recapitalizations or similar events. Also these bonds are often issued by
smaller, less creditworthy companies or by highly leveraged (indebted) firms,
which are generally less able than more financially stable firms to make
scheduled payments of interest and principal. The risks posed by bonds issued
under such circumstances are substantial.

The economy and interest rates may affect these high yield, high risk securities
differently from other securities. Prices have been found to be less sensitive
to interest rate changes than higher rated investments, but more sensitive to
adverse economic changes or individual corporate developments. Also, during an
economic downturn or a substantial period of rising interest rates, highly
leveraged issuers may experience financial stress which would adversely affect
their ability to service principal and interest payment obligations, to meet
projected business goals and to obtain additional financing. Changes by
recognized rating agencies in their rating of any security and in the ability of
an issuer to make payments of interest and principal will also ordinarily have a
more dramatic effect on the values of these investments than on the values of
higher-rated securities. Consequently, these changes will affect a Fund's net
asset value per share.

Foreign Currency Transactions

Although each Fund values its assets daily in terms of U.S. dollars, it does not
intend to convert its holdings of foreign currencies into U.S. dollars on a
daily basis. Each Fund will, however, from time to time, purchase or sell
foreign currencies and/or engage in forward foreign currency transactions in
order to expedite settlement of portfolio transactions and to minimize currency
value fluctuations. The Funds may conduct its foreign currency exchange
transactions on a spot (i.e., cash) basis at the spot rate prevailing in the
foreign currency exchange market or through entering into contracts to purchase
or sell foreign currencies at a future date (i.e., a "forward foreign currency"
contract or "forward" contract). A forward contract involves an obligation to
purchase or sell a specific currency at a future date, which may be any fixed
number of days from the date of the contract, agreed upon by the parties, at a
price set at the time of the contract. The Funds will convert currency on a spot
basis from time to time, and investors should be aware of the costs of currency
conversion.

The Funds may enter into forward contracts to "lock in" the price of a security
it has agreed to purchase or sell, in terms of U.S. dollars or other currencies
in which the transaction will be consummated. By entering into a forward
contract for the purchase or sale, for a fixed amount of U.S. dollars or foreign
currency, of the amount of foreign currency involved in the underlying security
transaction, the Fund will be able to protect itself against a possible loss
resulting from an adverse change in currency exchange rates during the period
between the date the security is purchased or sold and the date on which payment
is made or received.

When the Manager believes that the currency of a particular country may suffer a
significant decline against the U.S. dollar or against another currency, the
Funds may enter into a forward foreign currency contract to sell, for a fixed
amount of U.S. dollars or other appropriate currency, the amount of foreign
currency approximating the value of some or all of the Fund's securities
denominated in such foreign currency.

39
<PAGE>

The Funds will not enter into forward contracts or maintain a net exposure to
such contracts where the consummation of the contracts would obligate a Fund to
deliver an amount of foreign currency in excess of the value of the Fund's
securities or other assets denominated in that currency.

At the maturity of a forward contract, the Funds may either sell the portfolio
security and make delivery of the foreign currency, or it may retain the
security and terminate its contractual obligation to deliver the foreign
currency by purchasing an "offsetting" contract with the same currency trader
obligating it to purchase, on the same maturity date, the same amount of the
foreign currency. The Funds may realize gains or losses from currency
transactions.

The Funds also may purchase and write put and call options on foreign currencies
(traded on U.S. and foreign exchanges or over-the-counter) for hedging purposes
to protect against declines in the U.S. dollar cost of foreign securities held
by the Funds and against increases in the U.S. dollar cost of such securities to
be acquired. Call options on foreign currency written by a Fund will be covered,
which means that the Fund will own the underlying foreign currency. With respect
to put options on foreign currency written by a Fund, the Fund will establish a
segregated account with its Custodian Bank consisting of cash, U.S. government
securities or other high-grade liquid debt securities in an amount equal to the
amount the Fund will be required to pay upon exercise of the put.

As in the case of other kinds of options, the writing of an option on foreign
currency will constitute only a partial hedge, up to the amount of the premium
received, and the Fund could be required to purchase or sell foreign currencies
at disadvantageous exchange rates, thereby incurring losses. The purchase of an
option on foreign currency may constitute an effective hedge against
fluctuations in exchange rates, although, in the event of rate movements adverse
to the Fund's position, the Fund may forfeit the entire amount of the premium
plus related transaction costs.

<PAGE>

Certain management considerations

Year 2000
As with other mutual funds, financial and business organizations and individuals
around the world, the Funds could be adversely affected if the computer systems
used by their service providers do not properly process and calculate
date-related information from and after January 1, 2000. This is commonly known
as the "Year 2000 Problem." Each Fund is taking steps to obtain satisfactory
assurances that its major service providers are taking steps reasonably designed
to address the Year 2000 Problem on the computer systems that the service
providers use. However, there can be no assurance that these steps will be
sufficient to avoid any adverse impact on the business of the Funds.

EURO
Several European countries are participating in the European Economic and
Monetary Union, which established a common European currency for participating
countries. This currency is commonly known as the "Euro." Each participating
country replaced its previous currency with the Euro on January 1, 1999.
Additional European countries may elect to participate after that date. If a
Fund is invested in securities of participating countries, it could be adversely
affected if the computer systems used by its major service providers are not
properly prepared to handle the implementation of this single currency or the
adoption of the Euro by additional countries in the future. The Funds are taking
steps to obtain satisfactory assurances that their major service providers are
taking steps reasonably designed to address these matters on the computer
systems that the service providers use. However, there can be no assurances that
these steps will be sufficient to avoid any adverse impact on the business of
the Fund.

<PAGE>

Financial information
Financial highlights

The financial highlights table is intended to help you understand the Fund's
financial performance for the past five years. All "per share" information
reflects financial results for a single Fund share. This information has been
audited by Ernst & Young LLP, whose report, along with the Fund's financial
statements, is included in the Fund's annual report, which is available upon
request by calling 800o523o1918.

Financial highlights for the New Europe Fund and Latin America Fund are not
provided because these funds commenced operations after the close of the fiscal
year.

- ------------------------------------------------------------------------------------------------------------------------------------
Class A Shares Period Class B Shares Class C Shares
Year Ended 11/30 7/21/97 Year Ended 11/30 Year Ended 11/30
------------------- through ------------------- --------------------
Global Opportunities Fund 1998 11/30/97 1998 1998
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ($) 8.500
Income From Investment Operations
Net investment income ($) 0.056
Net realized & unrealized gains (losses) on
investments ($) (0.326)
Total from investment operations ($) (0.270)

Less Distributions

Dividends from net investment income ($) none
Distributions from realized gains ($) none
Total distributions ($) none
Net asset value, end of period ($) 8.230
Total Return (%) (3.18)
Ratios and Supplemental Data:
Net asset value, end of period (000's omitted) ($) 6
Ratio of expenses to average daily net assets (%) 0.80
Ratio of net investment income to average daily net
assets (%) 1.86
Portfolio turnover rate (%) 25
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
42

<PAGE>

- ------------------------------------------------------------------------------------------------------------------------------------
Class A Shares Class B Shares Class C Shares
Year Ended 11/30 Year Ended 11/30 Year Ended 11/30
------------------- ------------------ ------------------
Period Period
00/00/98 Period 00/00/98
through 00/00/98 through
11/30/98 through 11/30/98
International Small Cap Fund 11/30/98
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net Asset Value, Beginning of Period ($)
Income From Investment Operations
Net investment income ($)
Net realized & unrealized gains (losses) on investments ($)
Total from investment operations ($)

Less Distributions

Dividends from net investment income ($)
Distributions from realized gains ($)
Total distributions ($)
Net asset value, end of period ($)
Total Return (%)
Ratios and Supplemental Data:
Net asset value, end of period (000's omitted) ($)
Ratio of expenses to average daily net assets (%)
Ratio of net investment income to average daily net assets (%)
Portfolio turnover rate (%)
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
43

<PAGE>

How to read the financial highlights

Net investment income
Net investment income includes dividend and interest income earned from the
Fund's securities; it is after expenses have been deducted.

Net gains (losses) on investments (both realized and unrealized)
A realized gain occurs when we sell an investment at a profit, while a realized
loss occurs when we sell an investment at a loss. When an investment increases
or decreases in value but we do not sell it, we record an unrealized gain or
loss. The amount of realized gain per share that we pay to shareholders is
listed under "Less Distributions-Distributions from realized gains."

Net asset value (NAV)
This is the value of a mutual fund share, calculated by dividing the net assets
by the number of shares outstanding.

Total return
This represents the rate that an investor would have earned or lost on an
investment in the Fund. In calculating this figure for the financial highlights
table, we include fee waivers, exclude front-end and contingent deferred sales
charges, and assume the shareholder has reinvested all dividends and realized
gains.

Net assets
Net assets represent the total value of all the assets in the Fund's portfolio,
less any liabilities, that are attributable to that class of the Fund.

(continues on page ___)

<PAGE>

Financial information (continued)

How to read the financial highlights
(begins on page ___)

Ratio of expenses to average daily net assets
The expense ratio is the percentage of net assets that a fund pays annually for
operating expenses and management fees. These expenses include accounting and
administration expenses, services for shareholders, and similar expenses.

Ratio of net investment income to average daily net assets
We determine this ratio by dividing net investment income by average net assets.

Portfolio turnover rate
This figure tells you the amount of trading activity in a fund's portfolio. For
example, a fund with a 50% turnover has bought and sold half of the value of its
total investment portfolio during the stated period.

<PAGE>

Bonds Ratings

Excerpts from Moody's description of its bond ratings: Aaa--judged to be the
best quality. They carry the smallest degree of investment risk; Aa--judged to
be of high quality by all standards; A--possess favorable attributes and are
considered "upper medium" grade obligations; Baa--considered as medium grade
obligations. Interest payments and principal security appear adequate for the
present but certain protective elements may be lacking or may be
characteristically unreliable over any great length of time; Ba--judged to have
speculative elements; their future cannot be considered as well assured. Often
the protection of interest and principal payments may be very moderate and
thereby not well safeguarded during both good and bad times over the future.
Uncertainty of position characterizes bonds in this class; B--generally lack
characteristics of the desirable investment. Assurance of interest and principal
payments or of maintenance of other terms of the contract over any long period
of time may be small; Caa--are of poor standing. Such issues may be in default
or there may be present elements of danger with respect to principal or
interest; Ca--represent obligations which are speculative in a high degree. Such
issues are often in default or have other marked shortcomings; C--the lowest
rated class of bonds and issues so rated can be regarded as having extremely
poor prospects of ever attaining any real investment standing.

Excerpts from S&P's description of its bond ratings: AAA--highest grade
obligations. They possess the ultimate degree of protection as to principal and
interest; AA--also qualify as high grade obligations, and in the majority of
instances differ from AAA issues only in a small degree; A--strong ability to
pay interest and repay principal although more susceptible to changes in
circumstances; BBB--regarded as having an adequate capacity to pay interest and
repay principal; BB, B, CCC, CC--regarded, on balance, as predominantly
speculative with respect to capacity to pay interest and repay principal in
accordance with the terms of the obligation. BB indicates the lowest degree of
speculation and CC the highest degree of speculation. While such debt will
likely have some quality and protective characteristics, these are outweighed by
large uncertainties or major risk exposures to adverse conditions; C--reserved
for income bonds on which no interest is being paid; D--in default, and payment
of interest and/or repayment of principal is in arrears.

<PAGE>

How to use this glossary

Words found in the glossary are printed in boldface only the first time they
appear in the prospectus. So if you would like to know the meaning of a word
that isn't in boldface, you might still find it in the glossary.

Amortized cost
Amortized cost is a method used to value a fixed income security that starts
with the face value of the security and then adds or subtracts from that value
depending on whether the purchase price was greater or less than the value of
the security at maturity. The amount greater or less than the par value is
divided equally over the time remaining until maturity.

Average maturity
An average of when the individual bonds and other debt securities held in a
portfolio will mature.

Bond
A debt security, like an IOU, issued by a company, municipality or government
agency. In return for lending money to the issuer, a bond buyer generally
receives fixed periodic interest payments and repayment of the loan amount on a
specified maturity date. A bond's price changes prior to maturity and is
inversely related to current interest rates. When interest rates rise, bond
prices fall, and when interest rates fall, bond prices rise.

Bond ratings
Independent evaluations of creditworthiness, ranging from Aaa/AAA (highest
quality) to D (lowest quality). Bonds rated Baa/BBB or better are considered
investment grade. Bonds rated Ba/BB or lower are commonly known as junk bonds.
See also Nationally recognized statistical rating organization.

Capital
The amount of money you invest.

Capital appreciation
An increase in the value of an investment.

Capital gains distributions
Payments to mutual fund shareholders of profits (realized gains) from the sale
of a fund's portfolio securities. Usually paid once a year; may be either
short-term gains or long-term gains.

Commission
The fee an investor pays to a financial adviser for investment advice and help
in buying or selling mutual funds, stocks, bonds or other securities.

Compounding
Earnings on an investment's previous earnings.

Consumer Price Index (CPI)
Measurement of U.S. inflation; represents the price of a basket of commonly
purchased goods.

Contingent deferred sales charge (CDSC)
Fee charged by some mutual funds when shares are redeemed (sold back to the
fund) within a set number of years; an alternative method for investors to
compensate a financial adviser for advice and service, rather than an up-front
commission.

Corporate bond
A debt security issued by a corporation. See "bond."

<PAGE>

Depreciation
A decline in an investment's value.

Diversification
The process of spreading investments among a number of different securities,
asset classes or investment styles to reduce the risks of investing.

Dividend distribution
Payments to mutual fund shareholders of dividends passed along from the fund's
portfolio of securities.

Duration
A measurement of a fixed-income investment's price volatility. The larger the
number, the greater the likely price change for a given change in interest
rates.

Expense ratio
A mutual fund's total operating expenses, expressed as a percentage of its total
net assets. Operating expenses are the costs of running a mutual fund, including
management fees, offices, staff, equipment and expenses related to maintaining
the fund's portfolio of securities and distributing its shares. They are paid
from the fund's assets before any earnings are distributed to shareholders.

Financial adviser
Financial professional (e.g., broker, banker, accountant, planner or insurance
agent) who analyzes clients' finances and prepares personalized programs to meet
objectives.

Fixed-income securities
With fixed-income securities, the money you originally invested is paid back at
a pre-specified maturity date. These securities, which include government,
corporate or municipal bonds, as well as money market securities, typically pay
a fixed rate of return (often referred to as interest). See Bonds.

Inflation
The increase in the cost of goods and services over time. U.S. inflation is
frequently measured by changes in the Consumer Price Index (CPI).

Investment goal
The objective, such as long-term capital growth or high current income, that a
mutual fund pursues.

Management fee
The amount paid by a mutual fund to the investment adviser for management
services, expressed as an annual percentage of the fund's average daily net
assets.

Market capitalization
The value of a corporation determined by multiplying the current market price of
a share of common stock by the number of shares held by shareholders. A
corporation with one million shares outstanding and the market price per share
of $10 has a market capitalization of $10 million.

Maturity

The length of time until a bond issuer must repay the underlying loan principal
to bondholders.

National Association of Securities Dealers (NASD)
A self-regulating organization, consisting of brokerage firms (including
distributors of mutual funds), that is responsible for overseeing the actions of
its members.

<PAGE>

Nationally recognized statistical rating organization (NRSRO)
A company that assesses the credit quality of bonds, commercial paper, preferred
and common stocks and municipal short-term issues, rating the probability that
the issuer of the debt will meet the scheduled interest payments and repay the
principal. Ratings are published by such companies as Moody's Investors Service
(Moody's), Standard & Poor's Corporation (S&P), Duff & Phelps, Inc. (Duff), and
Fitch Investor Services, Inc. (Fitch).

Net asset value (NAV)
The daily dollar value of one mutual fund share. Equal to a fund's net assets
divided by the number of shares outstanding.

Preferred stock
Preferred stock has preference over common stock in the payment of dividends and
liquidation of assets. Preferred stocks also often pays dividends at a fixed
rate and is sometimes convertible into common stock.

Price/earnings ratio
A measure of a stock's value calculated by dividing the current market price of
a share of stock by its annual earnings per share. A stock selling for $100 per
share with annual earnings per share of $5 has a P/E of 20.

Principal
Amount of money you invest (also called capital). Also refers to a bond's
original face value, due to be repaid at maturity.

Prospectus
The official offering document that describes a mutual fund, containing
information required by the SEC, such as investment objectives, policies,
services and fees.

Redeem
To cash in your shares by selling them back to the mutual fund.

Risk
Generally defined as variability of value; also credit risk, inflation risk,
currency and interest rate risk. Different investments involve different types
and degrees of risk.

S&P 500 Index
The Standard & Poor's 500 Composite Stock Index; an unmanaged index of 500
widely held common stocks that is often used to represent performance of the
U.S. stock market.

Sales charge
Charge on the purchase or redemption of fund shares sold through financial
advisers. May vary with the amount invested. Typically used to compensate
advisers for advice and service provided.

SEC (Securities and Exchange Commission)
Federal agency established by Congress to administer the laws governing the
securities industry, including mutual fund companies.

Share classes
Different classifications of shares; mutual fund share classes offer a variety
of sales charge choices.

Signature guarantee
Certification by a bank, brokerage firm or other financial institution that a
customer's signature is valid; signature guarantees can be provided by members
of the STAMP program.

<PAGE>

Standard deviation
A measure of an investment's volatility; for mutual funds, measures how much a
fund's total return has typically varied from its historical average.

Statement of Additional Information (SAI)
The document serving as "Part B" of a fund's prospectus that provides more
detailed information about the fund's organization, investments, policies and
risks.

Stock
An investment that represents a share of ownership (equity) in a corporation.
Stocks are often referred to as "equities."

Total return
An investment performance measurement, expressed as a percentage, based on the
combined earnings from dividends, capital gains and change in price over a given
period.

Uniform Gift to Minors Act and Uniform Transfers to Minors Act
Federal and state laws that provide a simple way to transfer property to a minor
with special tax advantages.

Volatility
The tendency of an investment to go up or down in value by different magnitudes.
There are investments which are more likely to be "low volatility" and
investments which are more likely to be "high volatility" investments.

<PAGE>

[BACK COVER]

Additional information about the Funds' investments is available in the Funds'
annual and semi-annual reports to shareholders. In the Funds' shareholder
reports, you will find a discussion of the market conditions and investment
strategies that significantly affected the Funds' performance during the report
period. You can find more detailed information about the Funds in the current
Statement of Additional Information, which we have filed electronically with the
Securities and Exchange Commission (SEC) and which is legally a part of this
prospectus. If you want a free copy of the Statement of Additional Information,
the annual or semi-annual report, or if you have any questions about investing
in these funds, you can write to us at 1818 Market Street, Philadelphia, PA
19103-3682, or call toll-free 800o523o1918. You may also obtain additional
information about each of the Funds from your financial adviser.

You can find reports and other information about each Fund on the SEC web site
(http://www.sec.gov), or you can get copies of this information, after payment
of a duplicating fee, by writing to the Public Reference Section of the SEC,
Washington, D.C. 20549-6009. Information about the Funds, including their
Statement of Additional Information, can be reviewed and copied at the
Securities and Exchange Commission's Public Reference Room in Washington, D.C.
You can get information on the public reference room by calling the SEC at
1o800oSECo0330.

Web site
www.delawarefunds.com

E-mail
[email protected]

Shareholder Service Center

800o523o1918

Call the Shareholder Service Center Monday to Friday, 8 a.m. to 8 p.m.
Eastern time:

o For fund information; literature; price, yield and performance figures.

o For information on existing regular investment accounts and retirement plan
accounts including wire investments; wire redemptions; telephone
redemptions and telephone exchanges.

Delaphone Service

800o362oFUND (800o362o3863)

oFor convenient access to account information or current performance information
on all Delaware Investments Funds seven days a week, 24 hours a day, use this
Touch-Tone(R) service.

DELAWARE
INVESTMENTS
-----------
Philadelphia * London

Investment Company Act file number: 811-6324

<PAGE>
DELAWARE
INVESTMENTS
-----------

Philadelphia * London

Global Opportunities Fund
(formerly Global Equity Fund)
* * *
International Small Cap Fund
* * *
New Europe Fund
* * *
Latin America Fund

Institutional Class

Prospectus

[______________, 1999]

The Securities and Exchange Commission has not approved or disapproved these
securities or passed upon the accuracy of this prospectus, and any
representation to the contrary is a criminal offense.

<PAGE>

[inside front cover]

Table of Contents

Fund Profiles page
International Small Cap Fund
Global Opportunities Fund
New Europe Fund
Latin America Fund

How we manage the Fund page
Our investment strategy
The securities that we typically invest in
The risks of investing in the Fund

Who manages the Fund page
Our investment strategies
The securities we typically invest in
The risks of investing in the Funds

Fund administration (Who's who?) page

About your account page
Investing in the Funds
How to buy shares
How to redeem shares
Account minimum
Exchanges

Dividends, Distributions and Taxes

Other investment policies and page
risk considerations

Financial information page

Bond ratings page

Glossary page

2
<PAGE>

How to use this prospectus

Step 1
Take a look at the fund profiles for an overview of each Fund.

Step 2
Learn in-depth information about how the Funds invest, the risks involved and
the people and organizations responsible for the Funds' day-to-day operations.

Step 3
Determine which fund features and services you would like to take advantage of.

Step 4
Use the glossary that begins on page 6 to find definitions of words printed in
bold type in the text throughout the prospectus.

3
<PAGE>

Profile: Global Opportunities Fund*

What are the Fund's goals?

The Global Opportunities Fund's investment goal is to achieve long-term total
return. Although the Fund will strive to achieve its goal, there is no assurance
that it will.

An investment in the Fund is not a deposit of any bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other
government agency.

Who should not invest in the Fund
o Investors with short-term financial goals.
o Investors who are unwilling to accept risks of investing in
foreign equity securities.

* The Global Opportunities Fund was formerly known as Global Equity Fund. The
change in the Fund's name became effective on July 21, 1998.

4
<PAGE>

How has the Global Opportunities Fund performed?

This bar chart and table can help you evaluate the potential risks of investing
in the Fund. We show the returns for the Fund's Institutional Class shares for
the past calendar year, as well as the average annual returns of all shares for
the one year period and since inception--all compared to the performance of the
Morgan Stanley World Index. You should remember that unlike the Fund, the index
is unmanaged and doesn't reflect the costs of operating a mutual fund, such as
the costs of buying, selling, and holding the securities. The Fund's past
performance is not necessarily an indication of how it will perform in the
future. The returns reflect voluntary expense caps. The returns would be lower
without the voluntary caps.

[GRAPHIC OMITTED: BAR CHART SHOWING TOTAL RETURN (INSTITUTIONAL CLASS)]
Total return (Institutional Class)

Global Opportunities Fund Institutional Class Morgan Stanley World Index
1998

As of December 31, 1998, the Fund's Institutional Class shares had a
year-to-date return of ______%. During the period illustrated in this bar chart,
Institutional Class's highest return was ____% for the quarter ended [DATE] and
its lowest return was ____% for the quarter ended [DATE].

How has the Global Opportunities Fund performed? (continued)

[table]

Average annual returns for periods ending 12/31/98
-------------------------------------------------------------------------
CLASS Institutional Morgan Stanley
World Index
-------------------------------------------------------------------------
1 year
Since inception
(7/21/97)

5
<PAGE>

What are the Global Opportunities Fund's fees and expenses?
You do not pay sales charges directly from your investments when you buy or sell
shares of the Institutional Class.

- -------------------------------------------------------------
Maximum sales charge (load) imposed on purchases as None
a percentage of offering price
- -------------------------------------------------------------
Maximum contingent deferred sales charge None
(load) as a percentage of original purchase
price or redemption price, whichever is lower
- -------------------------------------------------------------
Maximum sales charge (load) imposed on
reinvested dividends None
- -------------------------------------------------------------
Redemption fees None
- -------------------------------------------------------------
Exchange Fees(1) None
- -------------------------------------------------------------

- --------------------------------------------------------
Management fees
- --------------------------------------------------------
Distribution and service (12b-1) fees None
- --------------------------------------------------------
Other expenses
- --------------------------------------------------------
Total operating expenses(2)
- --------------------------------------------------------

This example is intended to help you compare the cost of investing in the Fund
to the cost of investing in other mutual funds with similar investment
objectives. We show the cumulative amount of Fund expenses on a hypothetical
investment of $10,000 with an annual 5% return over the time shown. (3) This is
an example only, and does not represent future expenses, which may be greater or
less than those shown here.

- -----------------------------
1 year
- -----------------------------
3 years
- -----------------------------
5 years
- -----------------------------
10 years
- -----------------------------

(1) Exchanges are subject to the requirements of each fund in the Delaware
Investments family. A front-end sales charge may apply if you exchange
your shares into a fund that has a front-end sales charge.

(2) The investment manager has agreed to waive fees and pay expenses
through May 31,1999, in order to prevent total operating expenses
(excluding any taxes, interest, brokerage fees and extraordinary
expenses) from exceeding 0.80% of average daily net assets.

(3) The Fund's actual rate of return may be greater or less than the
hypothetical 5% return we use here. Also, this example assumes that the
Fund's total operating expenses remain unchanged in each of the periods
we show. In addition, this example does not reflect the voluntary
expense cap described in footnote 2.

6
<PAGE>

Profile: International Small Cap Fund

What are the Fund's goals?
International Small Cap Fund seeks long-term capital appreciation. Although, the
Fund will strive to achieve its goal, there is no assurance that it will.

What are the main risks of investing in the Fund?
Investing in any mutual fund involves risk, including the risk that you may lose
part or all of the money you invest. The price of Fund shares will increase and
decrease according to changes in the value of the Fund's investments. This Fund
will be affected primarily by declines in stock and bond prices which can be
caused by a drop in the stock or bond market, an adverse change in interest
rates or poor performance in specific industries or companies. Investments in
foreign securities whether equity or fixed-income, involve special risks
including those related to currency fluctuations, as well as to political,
economic and social situations different from and potentially more volatile than
those in the U.S. In addition, the accounting, tax and financial reporting
standards of foreign countries are different from and may be less reliable or
comprehensive than those relating to U.S. issuers. The Fund may invest up to 15%
of its net assets in high yield, high risk foreign fixed income securities,
which are subject to substantial risks, particularly during periods of economic
downturns or rising interest rates. For a more complete discussion of risk,
please turn to page __.

The Fund is not a deposit of any bank and is not insured or guaranteed by the
Federal Deposit Insurance Corporation (FDIC) or any other government agency.

Who should invest in the Fund?
o Investors with long-term financial goals.
o Investors looking for growth potential from a portfolio of
international securities.
o Investors willing to accept the risks associated with foreign
investing as well as investments in smaller-sized issuers, some to
which may be speculative.

Who should not invest in the Fund o Investors with short-term financial goals.
o Investors who are unwilling to accept share prices that may
fluctuate, sometimes significantly, over the short term.
o Investors whose primary goal is income.

7
<PAGE>

What are the International Small Cap Fund's fees and expenses?
You do not pay sales charges directly from your investments when you buy or sell
shares of the Institutional Class.

- -------------------------------------------------------------
Maximum sales charge (load) imposed on purchases as None
a percentage of offering price
- -------------------------------------------------------------
Maximum contingent deferred sales charge None
(load) as a percentage of original purchase
price or redemption price, whichever is lower
- -------------------------------------------------------------
Maximum sales charge (load) imposed on None
reinvested dividends
- -------------------------------------------------------------
Redemption fees None
- -------------------------------------------------------------
Exchange Fees(1) None
- -------------------------------------------------------------

This example is intended to help you compare the cost of investing in the Fund
to the cost of investing in other mutual funds with similar investment
objectives. We show the cumulative amount of Fund expenses on a hypothetical
investment of $10,000 with an annual 5% return over the time shown. (3) This is
an example only, and does not represent future expenses, which may be greater or
less than those shown here.

- -----------------------------
1 year
- -----------------------------
3 years
- -----------------------------
5 years
- -----------------------------
10 years
- -----------------------------

8
<PAGE>

Profile: New Europe Fund

What are the Fund's goals?
The New Europe Fund seeks long-term capital appreciation. Although, the Fund
will strive to achieve its goal, there is no assurance that it will.

What are the main risks of investing in the Fund?
Investing in any mutual fund involves risk, including the risk that you may lose
part or all of the money you invest. The price of Fund shares will increase and
decrease according to changes in the value of the Fund's investments. This Fund
will be affected primarily by declines in stock and bond prices which can be
caused by a drop in the stock or bond market, an adverse change in interest
rates or poor performance in specific industries or companies. The New Europe
Fund targets a specific region of the world for investment. Thus, an investment
in this Fund will likely be more volatile than a more geographically diversified
fund. In addition, the performance of this Fund is closely tied to the economic
and political conditions of the region. The Fund may invest up to 30% of its net
assets in high yield, high risk foreign fixed income securities, which are
subject to substantial risks, particularly during periods of economic downturns
or rising interest rates. For a more complete discussion of risk, please turn to
page __.

An investment in the Fund is not a deposit of any bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other
government agency.

Who should invest in the Fund?
o Investors with long-term financial goals.
o Investors looking for growth potential.
o Investors willing to accept the risks associated with foreign
investing as well as investments in smaller-sized issuers, some to
which may be speculative.

Who should not invest in the Fund
o Investors with short-term financial goals.
o Investors who are unwilling to accept share prices that may
fluctuate, sometimes significantly, over the short term.
o Investors whose primary goal is income.

9
<PAGE>

What are the New Europe Fund's fees and expenses?

You do not pay sales charges directly from your investments when you buy or sell
shares of the Institutional Class.

- -------------------------------------------------------------
Maximum sales charge (load) imposed on purchases as None
a percentage of offering price
- -------------------------------------------------------------
Maximum contingent deferred sales charge None
(load) as a percentage of original purchase
price or redemption price, whichever is lower
- -------------------------------------------------------------
Maximum sales charge (load) imposed on None
reinvested dividends
- -------------------------------------------------------------
Redemption fees None
- -------------------------------------------------------------
Exchange Fees(1) None
- -------------------------------------------------------------

- --------------------------------------------------------
Management fees
- --------------------------------------------------------
Distribution and service (12b-1) fees None
- --------------------------------------------------------
Other expenses(2)
- --------------------------------------------------------
Total operating expenses(3)
- --------------------------------------------------------

This example is intended to help you compare the cost of investing in the Fund
to the cost of investing in other mutual funds with similar investment
objectives. We show the cumulative amount of Fund expenses on a hypothetical
investment of $10,000 with an annual 5% return over the time shown. (4) This is
an example only, and does not represent future expenses, which may be greater or
less than those shown here.

- -----------------------------
1 year
- -----------------------------
3 years
- -----------------------------

(2) Other expenses are based on estimated amounts for the current fiscal
year.

(3) The investment manager has agreed to waive fees and pay expenses
through May 31,1999, in order to prevent total operating expenses
(excluding any taxes, interest, brokerage fees and extraordinary
expenses) from exceeding 1.25% of average daily net assets.

(4) The Fund's actual rate of return may be greater or less than the
hypothetical 5% return we use here. Also, this example assumes that the
Fund's total operating expenses remain unchanged in each of the periods
we show. In addition, this example does not reflect the voluntary
expense cap described in footnote 2.

10
<PAGE>

Profile: Latin America Fund

What are the Fund's goals?
The Latin America Fund seeks long-term capital appreciation. Although, the Fund
will strive to achieve its goal, there is no assurance that it will.

What are the main risks of investing in the Fund?
Investing in any mutual fund involves risk, including the risk that you may lose
part or all of the money you invest. The price of Fund shares will increase and
decrease according to changes in the value of the Fund's investments. This Fund
will be affected primarily by declines in stock and bond prices which can be
caused by a drop in the stock or bond market, an adverse change in interest
rates or poor performance in specific industries or companies. The Latin America
Fund targets a specific region of the world for investment. Therefore, an
investment in this Fund will likely be more volatile than a more geographically
diversified fund. In addition, the performance of this Fund is tied to the
economic and political conditions of this region.The Fund may invest up to 30%
of its net assets in high yield, high risk foreign fixed income securities,
which are subject to substantial risks, particularly during periods of economic
downturns or rising interest rates.

For a more complete discussion of risk, please turn to page __.

An investment in the Fund is not a deposit of any bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency.

Who should invest in the Fund?
o Investors with long-term financial goals.
o Investors looking for growth potential.
o Investors willing to accept the risks associated with foreign
investing as well as investments in smaller-sized issuers, some to
which may be speculative.

Who should not invest in the Fund
o Investors with short-term financial goals.
o Investors whose primary goal is income.
o Investors who are unwilling to accept share prices that may
fluctuate, sometimes significantly, over the short term.

11
<PAGE>

What are the Fund's fees and expenses?
You do not pay sales charges directly from your investments when you buy or sell
shares of the Institutional Class.

- -------------------------------------------------------------
Maximum sales charge (load) imposed on purchases as None
a percentage of offering price
- -------------------------------------------------------------
Maximum contingent deferred sales charge None
(load) as a percentage of original purchase
price or redemption price, whichever is lower
- -------------------------------------------------------------
Maximum sales charge (load) imposed on None
reinvested dividends
- -------------------------------------------------------------
Redemption fees None
- -------------------------------------------------------------
Exchange Fees(1) None
- -------------------------------------------------------------

- --------------------------------------------------------
Management fees
- --------------------------------------------------------
Distribution and service (12b-1) fees None
- --------------------------------------------------------
Other expenses(2)
- --------------------------------------------------------
Total operating expenses(3)
- --------------------------------------------------------

This example is intended to help you compare the cost of investing in the Fund
to the cost of investing in other mutual funds with similar investment
objectives. We show the cumulative amount of Fund expenses on a hypothetical
investment of $10,000 with an annual 5% return over the time shown. (4) This is
an example only, and does not represent future expenses, which may be greater or
less than those shown here.

- -----------------------------
1 year
- -----------------------------
3 years
- -----------------------------

(2) Other expenses are based on estimated amounts for the current fiscal
year.

12
<PAGE>

How we manage the Funds

We take a disciplined approach to investing, combining investment strategies and
risk management techniques that can help shareholders meet their goals.

Our investment strategy

Global Opportunities Fund

13
<PAGE>

International Small Cap Fund

While the Fund may purchase securities in any foreign country, developed and
underdeveloped, or emerging market countries, it is currently anticipated that
the countries in which the Fund may invest will include, but not be limited to,
Canada, Germany, the United Kingdom, France, the Netherlands, Belgium, Spain,
Switzerland, Japan, Australia, New Zealand, Hong Kong, Singapore and Malaysia as
well as Argentina, Brazil, Chile, Egypt, Greece, India, Indonesia, Korea, Peru,
the Philippines, South Africa, Taiwan, Thailand and Turkey. With respect to
certain countries, investments by an investment company may only be made through
investments in closed-end investment companies that in turn are authorized to
invest in the securities of such countries.

The Fund may also invest in convertible preferred stocks that offer enhanced
yield features, such as Preferred Equity Redemption Cumulative Stock, and
certain other non-traditional equity securities.

For temporary defensive purposes, the International Small Cap Fund may invest
all or a substantial portion of its assets in high quality debt instruments
issued by foreign governments, their agencies, instrumentalities or political
subdivisions, the U.S. government, its agencies or instrumentalities (and which
are backed by the full faith and credit of the U.S. government), or issued by
foreign or U.S. companies. For example, the Fund may invest in U.S. fixed-income
markets when the manager believes that the global equity markets are excessively
volatile or overvalued so that the Fund's objective cannot be achieved in such
markets. Any such corporate debt obligations will be rated AA or better by S&P,
or Aa or better by Moody's, or if unrated, will be determined to be of
comparable quality by the Fund's investment manager. The Fund may also invest in
the securities listed above pending investment of proceeds from new sales of
Fund shares and to maintain sufficient cash to meet redemption requests.

14
<PAGE>

New Europe Fund

15
<PAGE>

Latin America Fund

16
<PAGE>

- ------------------------------------------------------------------------------------------------------------------------------
Securities How we use them
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C>
Corporate Bonds: Debt obligations issued by a The Funds may invest in corporate bonds generally rated AA or better
corporation. by S&P and Aa by Moody's .
- ------------------------------------------------------------------------------------------------------------------------------
Common Stocks: Securities that represent Consistent with their respective investment objective, certain Funds
shares of ownership in a corporation. will invest their assets in common stocks, as well as in dividend
Stockholders participate in the corporation's paying stocks.
profits and losses, proportionate to the
number of shares they own.
- ------------------------------------------------------------------------------------------------------------------------------
Foreign Currency Transactions: The Funds will Although the Funds value their assets daily in terms of U.S. dollars,
invest in securities of foreign issuers and may hold they do not intend to convert their holdings of foreign currencies
foreign currency. In addition, the Funds may enter into U.S. dollars on a daily basis. Each Fund will, however, from
into contracts to purchase or sell foreign time to time, purchase or sell foreign currencies and/or engage in
currencies at a future date (i.e., a "forward forward foreign currency transactions in order to expedite settlement
foreign currency contract" or "forward contract"). of portfolio transactions and to minimize currency value
A forward contract involves an obligation to fluctuations. Each Fund may conduct its foreign currency
purchase or sell a specific currency at a future transactions on a spot (i.e., cash) basis at the spot rate prevailing
date, which may be any fixed number of days from the in the foreign currency exchange market or through a forward foreign
date of the contract, agreed upon by the parties, at currency contract or forward contract. The Funds will convert
a price set at the time of the contract. A Fund may currency on a spot basis from time to time, and investors should be
enter into forward contracts to "lock-in" the price aware of the costs of currency conversion. By entering into these
of a security it has agreed to purchase or sell, in transactions, the Funds attempt to protect themselves against a
terms of U.S. dollars or other currencies in which possible loss resulting from an adverse change in currency exchange
the transaction will be consummated. rates during the period between when the security is purchased or
sold and the date on which payment is made or received.
- ------------------------------------------------------------------------------------------------------------------------------
Repurchase Agreements: An agreement between a buyer Typically, we use repurchase agreements as a short-term investment
and seller of securities in which the seller agrees for a Fund's cash position. In order to enter into these repurchase
to buy the securities back within a specified time agreements, the Fund must have collateral of at least 102% of the
at the same price the buyer paid for them, plus an repurchase price.
amount equal to an agreed upon interest rate.
Repurchase agreements are often viewed as equivalent
to cash.
- ------------------------------------------------------------------------------------------------------------------------------
American Depositary Receipts (ADRs): Certificates Each Fund may invest in sponsored and unsponsored ADR's that are
issued by a U.S. bank that represent a stated number actively traded in the United States.
of shares of a foreign corporation that the bank
holds in its vault. An ADR entitles the holder to
all dividends and capital gains earned by the
underlying foreign shares. An ADR is bought and sold
the same as U.S. securities.
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>

17
<PAGE>

<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C>
European Depositary Receipts (EDRs) and In conjunction with their investments in foreign securities, the
Global Depositary Receipts (GDRs): EDRs and GDRs Funds may invest in sponsored and unsponsored EDRs and GDRs that are
are receipts issued by non-U.S. banks or trust actively traded in the United States.
companies and foreign branches of U.S. banks that
evidence ownership of the underlying foreign or U.S.
securities. Sponsored EDRs or GDRs are issued
jointly by the issuer of the underlying security and
a Depositary, and unsponsored EDRs or GDRs are
issued without the participation of the issuer of
the deposited security.
- ------------------------------------------------------------------------------------------------------------------------------
Restricted Securities: Privately placed securities Each Fund, except for Global Opportunities Fund, may invest up to 15%
whose resale is restricted under securities law. of their assets in privately placed securities that are eligible for
resale only among certain institutional buyers without registration.
These are commonly known as "Rule 144A Securities." The Global
Opportunities may only invest up to 10% of their assets in these
securities.
- ------------------------------------------------------------------------------------------------------------------------------
Borrowing from Banks Each Fund may borrow money as a temporary measure for extraordinary
purposes or to facilitate redemptions. Each Fund will not borrow money
in excess of one-third of the value of its net assets.
- ------------------------------------------------------------------------------------------------------------------------------
Securities Lending: These transactions involve the Each Fund may loan up to 25% of its assets to qualified broker/dealers
loan of securities owned by the Fund to qualified or institutional investors. These transactions will generate additional
dealers and investors for their use relating to income for the Fund.
short-sales or other securities transactions.
- ------------------------------------------------------------------------------------------------------------------------------
Investment Company Securities Each Fund may invest in either closed-end or open-end investment
companies consistent with the 1940 Act requirements. These investments
involve an indirect payment of a portion of the expenses, including
advisory fees, of such other investment companies.
- ------------------------------------------------------------------------------------------------------------------------------
Brady Bonds: These are debt securities issued under International Small Cap Fund, New Europe Fund and Latin America Fund
the framework of the Brady Plan, an initiative may invest in Brady Bonds consistent with their respective investment
announced by the U.S. Treasury Secretary, Nicholas objective. We believe that the economic reforms undertaken by
F. Brady in 1989, as a mechanism for debtor countries in connection with the issuance of Brady Bonds makes the
nations to restructure their outstanding external debt of countries that have issued or have announced plans to issue
indebtedness (generally, commercial bank debt). Brady Bonds an attractive opportunity for investment.
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>

18
<PAGE>

<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
Risks How we strive to manage them
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C>
Market Risk is the risk that all or a majority of the We maintain a long-term investment approach and focus on stocks we
securities in a certain market - like the stock or believe can appreciate over an extended time frame regardless of
bond market - will decline in value because of interim market fluctuations. We do not try to predict overall stock
factors such as economic conditions, future market movements and do not trade for short-term purposes.
expectations or investor confidence.
- ------------------------------------------------------------------------------------------------------------------------------
Industry and Security Risk is the risk that the We limit the amount of the Fund's assets invested in any one industry
value of securities in a particular industry or the and in any security. We individual also follow a rigorous selection
value of an individual stock or bond will decline process before for choosing securities for the Fund.
because of changing expectations for the
performance of that industry or the individual
company issuing the stock or bond.
- ------------------------------------------------------------------------------------------------------------------------------
Foreign Risk is the risk that foreign securities The Fund's will invest in securities of foreign issuers that normally
may be adversely affected by political instability, are denominated in foreign currencies may hold foreign currency
changes in currency exchange rates, foreign economic directly. Investments in and securities of non-United States issuers
conditions or inadequate regulatory and accounting which are generally denominated in foreign currencies involve certain
standards. Transaction costs may be higher. risk and opportunity considerations not typically associated with
investing in United States companies. We carefully evaluate the
overall situations in the countries where we invest in an attempt to
reduce these risks.
- ------------------------------------------------------------------------------------------------------------------------------
Currency Risk is the risk that the value of a Fund's Each Fund may try to hedge its currency risk by purchasing foreign
investments may be negatively affected by changes currency exchange contracts. By agreeing to purchase or sell foreign
in foreign currency exchange rates, foreign economic securities at a pre-set price on a future date, the Funds strive to
conditions or inadequate regulatory and accounting protect the value of the stock they own from future changes in
standards. currency rates. Each Fund will use forward currency exchange
contracts only for defensive measures, not to enhance portfolio
returns. However, there is no assurance that a strategy such as this
will be successful.
- ------------------------------------------------------------------------------------------------------------------------------
Emerging Markets Risk is the risk that there is the International Small Cap, New Europe and Latin America Funds have the
possibility of expropriation, nationalization, ability to invest in emerging market securities. By maintaining a
confiscatory taxation, income earned or other special long-term investment approach, we believe we can appreciate
taxes, foreign exchange restrictions, limitations on regardless of interim political, social or economic instabilities.
the repatriation of income and capital from
investments, defaults in foreign government debt,
and economic, political or social instability.
In addition, in many emerging markets, there is
substantially less publicly available information
about issuers and the information that is available
tends to be of a lesser quality. Economic markets and
structures tend to be less mature and diverse and the
securities markets which are subject to less
government regulation or supervision may also be
smaller, less liquid and subject to greater price
volatility. Transaction costs may be higher.
------------------------------------------------------------------------------------------------------------------------------
</TABLE>

19
<PAGE>

- ------------------------------------------------------------------------------------------------------------------------------
<S> <C>
High Yield, High Risk Foreign Fixed-Income Securities New Europe Fund and Latin America Fund may invest up to 30% of their
are those securities rated lower than BBB by S&P and respective net assets in these securities. International Small Cap may
Baa by Moody's. Securities of this type are invest up to 15% of its net assets in these securities. These Funds
considered to be of poor standing and predominantly will not purchase securities rated lower than C by S&P or Ca by
speculative as the ability to repay interest and Moody's or, if unrated, considered to be of an equivalent quality to
principal. such ratings by the Manager.
- ------------------------------------------------------------------------------------------------------------------------------
Region Risk is the risk associated with investing a With respect to the New Europe and Latin America Funds, we maintain a
majority of the Fund's assets in a specific long-term approach and focus on stocks in region we believe can
region of the world. The Fund's performance will be appreciate over an extended the time frame.
dependent upon the economic and financial strength
and stability of the region. An investment in the
Fund is likely to be more volatile than an investment
in a more geographically diverse fund.
- ------------------------------------------------------------------------------------------------------------------------------
Political Risk is the risk that countries or the We carefully evaluate the political situations in the countries where
entire region where we may invest may experience we invest and take into account any potential risks before we select
political instability, which may cause greater securities for the portfolios. However, there is no way to eliminate
fluctuation in the value of our investments due to political risk when investing internationally.
changes in currency exchange rates, governmental
seizures or nationalization of assets.
- ------------------------------------------------------------------------------------------------------------------------------
Information Risk is the possibility that foreign Each Fund conducts a great deal of fundamental research on the
companies are subject to different accounting, companies that it invests in rather than relying companies. solely on
auditing and financial reporting standards than information available through financial reporting. We believe this
U.S. companies. There may be less information will help us to better uncover any potential weaknesses in individual
available about foreign issuers than domestic companies.
issuers. Furthermore, regulatory oversight of
foreign issuers may be less stringent or less
consistently applied than in the U.S.
- ------------------------------------------------------------------------------------------------------------------------------
Portfolio Turnover rates reflect the amount of The Funds normally will not invest for short-term trading purposes.
securities that are replaced from the beginning However, a fund may sell securities without regard to the length of
of the year to the end of the year by the Fund. time they have been held. Given each Fund's investment objective, it
The degree of portfolio activity may affect brokerage is anticipated that the portfolio turnover rate of each Fund will not
costs and other transaction costs of the Fund, as exceed 100%.
well as taxes payable by shareholders that are
subject to federal income tax.
- ------------------------------------------------------------------------------------------------------------------------------
Foreign Government Securities Risks involve The Funds attempt to reduce the risks associated with investing in
the ability of a foreign government or government foreign governments by setting rating standards and by limiting the
related issuer to make timely and ultimate payments portion of portfolio assets that may be invested in such securities.
on its external debt obligations. This ability to
make payments will be strongly influenced by the
issuer's balance of payments, including export
performance, its access to international credits
and investments, fluctuations in interest rates
and the extent of its foreign reserves.
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>

20
<PAGE>

- ------------------------------------------------------------------------------------------------------------------------------
<S> <C>
Small Company Investment Risk includes the general The securities of companies with small revenues and capitalization in
risks of investing in common stocks such as market, which the Fund invests, may offer greater opportunity for capital
economic and business risk that cause their prices appreciation than larger companies.
to fluctuate over time. Historically, smaller
capitalization stocks have been more volatile in
price than larger capitalization stocks. Among the
reasons for the greater price volatility of these
securities are the lower degree of liquidity in the
markets for such stocks, and the potentially greater
sensitivity of such small companies to changes in or
failure of management, and in many other changes in
competitive, business, industry and economic
conditions, including risks associated with limited
production, markets, management depth, or financial
resources.
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>

21
<PAGE>

Who manages the Funds

For their services to the Global Opportunites Fund, the manager and sub-adviser
were paid an aggregate fee of 0.00% of average daily net assets of the Fund for
the last fiscal year.

For its services to the International Small Cap Fund, the manager is paid an
annual fee of 1.25% of the average daily net assets of the Fund.

Portfolio Managers

22
<PAGE>

Who's who?

This diagram show the various organizations involved with managing,
administering and servicing the Delaware Investments funds.

Board of Directors
<S> <C> <C>
Investment Manager The Funds Custodian
Delaware International Advisers The Chase Manhattan Bank
Third Floor 4 Chase Metrotech Center
80 Cheapside Brooklyn, NY 11245
London, England EC2V 6EE

Sub-Adviser
Delaware Management Company
One Commerce Square
Philadelphia, PA 19103

Shareholders
</TABLE>

Sub-adviser A sub-adviser is a company generally responsible for the management
of the fund's assets. They are selected and supervised by the investment
manager.

Portfolio managers Portfolio managers are employed by the investment manager or
sub-adviser to make investment decisions for individual portfolios on a
day-to-day basis.

Custodian Mutual funds are legally required to protect their portfolio
securities and typically place them with a qualified bank custodian who
segregates fund securities from other bank assets.

23
<PAGE>

24
<PAGE>

About your account

Investing in the Funds

o Institutional Class shares are available for purchase only by the
following:

o retirement plans introduced by persons not associated with brokers or
dealers that are primarily engaged in the retail securities business and
rollover individual retirement accounts from such plans

o tax-exempt employee benefit plans of the manager or its affiliates and
securities dealer firms with a selling agreement with the distributor

o institutional advisory accounts of the manager, or its affiliates and those
having client relationships with Delaware Investment Advisers, an affiliate
of the manager, or its affiliates and their corporate sponsors, as well as
subsidiaries and related employee benefit plans and rollover individual
retirement accounts from such institutional advisory accounts

o a bank, trust company and similar financial institution investing for its
own account or for the account of its trust customers for whom such
financial institution is exercising investment discretion in purchasing
shares of the Class, except where the investment is part of a program that
requires payment to the financial institution of a Rule 12b-1 Plan fee

o registered investment advisers investing on behalf of clients that consist
solely of institutions and high net-worth individuals having at least
$1,000,000 entrusted to the adviser for investment purposes, but only if
the adviser is not affiliated or associated with a broker or dealer and
derives compensation for its services exclusively from its clients for such
advisory services

25
<PAGE>

How to buy shares

[GRAPHIC OMITTED: ILLUSTRATION OF AN ENVELOPE]

[GRAPHIC OMITTED: ILLUSTRATION OF A JAGGED LINE]

By wire
Ask your bank to wire the amount you want to invest to First Union Bank, ABA
#031201467, Bank Account number 2014128934013. Include your account number and
the name of the fund in which you want to invest. If you are making an initial
purchase by wire, you must call us at 800-510-4015 so we can assign you an
account number.

[GRAPHIC OMITTED: ILLUSTRATION OF AN EXCHANGE SYMBOL]

By exchange
You can exchange all or part of your investment in one or more funds in the
Delaware Investments family for shares of other funds in the family. Please keep
in mind, however, that you may not exchange your shares for Class B or Class C
shares. To open an account by exchange, call your Client Services Representative
at 800-510-4015.

[GRAPHIC OMITTED: ILLUSTRATION OF A PERSON]

Through your financial adviser
Your financial adviser can handle all the details of purchasing shares,
including opening an account. Your adviser may charge a separate fee for this
service.

26
<PAGE>

About your account (continued)

How to buy shares (continued)

The price you pay for shares will depend on when we receive your purchase order.
If we or an authorized agent receives your order before the close of trading on
the New York Stock Exchange (normally 4:00 p.m. Eastern Time) on a business day,
you will pay that day's closing share price which is based on the Fund's net
asset value. If we receive your order after the close of trading, you will pay
the next business day's price. A business day is any day that the New York Stock
Exchange is open for business. Currently, the Exchange is closed when the
following holidays are observed: New Year's Day, Martin Luther King, Jr.'s
Birthday, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor
Day, Thanksgiving and Christmas. We reserve the right to reject any purchase
order.

We determine the Funds' net asset value (NAV) per share at the close of trading
of the New York Stock Exchange each business day that the Exchange is open. We
calculate this value by adding the market value of all the securities and assets
in the Fund's portfolio, deducting all liabilities, and dividing the resulting
number by the number of shares outstanding. The result is the net asset value
per share. We price securities and other assets for which market quotations are
available at their market value. We price fixed-income securities on the basis
of valuations provided to us by an independent pricing service that uses methods
approved by the board of directors. Any fixed-income securities that have a
maturity of less than 60 days we price at amortized cost. We price all other
securities at their fair market value using a method approved by the board of
directors.

27
<PAGE>

How to redeem shares

[GRAPHIC OMITTED: ILLUSTRATION OF AN ENVELOPE]

By mail
You can redeem your shares (sell them back to the fund) by mail by writing to:
Delaware Investments, 1818 Market Street, Philadelphia, PA 19103-3682. All
owners of the account must sign the request, and for redemptions of $50,000 or
more, you must include a signature guarantee for each owner. You can also fax
your written request to 215-255-8864. Signature guarantees are also required
when redemption proceeds are going to an address other than the address of
record on an account.

[GRAPHIC OMITTED: ILLUSTRATION OF A TELEPHONE]

[GRAPHIC OMITTED: ILLUSTRATION OF A JAGGED LINE]

By wire
You can redeem $1,000 or more of your shares and have the proceeds deposited
directly to your bank account the next business day after we receive your
request. Bank information must be on file before you request a wire redemption.

[GRAPHIC OMITTED: ILLUSTRATION OF A PERSON]

Through your financial adviser
Your financial adviser can handle all the details of redeeming your shares. Your
adviser may charge a separate fee for this service.

28
<PAGE>

About your account (continued)

How to redeem shares (cont.)

If you hold your shares in certificates, you must submit the certificates with
your request to sell the shares. We recommend that you send your certificates by
certified mail.

When you send us a properly completed request to redeem or exchange shares, you
will receive the net asset value as determined on the business day we receive
your request. We will send you a check, normally the next business day, but no
later than seven days after we receive your request to sell your shares. If you
purchased your shares by check, we will wait until your check has cleared, which
can take up to 15 days, before we send your redemption proceeds.

Account minimum
If you redeem shares and your account balance falls below $250, the Fund may
redeem your account after 60 days' written notice to you.

Exchanges
You can exchange all or part of your shares for shares of the same class in
another Delaware Investments fund. If you exchange shares to a fund that has a
sales charge you will pay any applicable sales charges on your new shares. You
don't pay sales charges on shares that are acquired through the reinvestment of
dividends. You may have to pay taxes on your exchange. When you exchange shares,
you are purchasing shares in another fund so you should be sure to get a copy of
the fund's prospectus and read it carefully before buying shares through an
exchange. You may not exchange your shares for Class B and Class C shares of the
funds in the Delaware Investments family.

29
<PAGE>

Dividends, Distributions and Taxes

Dividends and capital gains, if any, are paid annually. We automatically
reinvest all dividends and any capital gains.

30
<PAGE>

Other investment policies and risk considerations

High Yield, High Risk Securities

Foreign Currency Transactions

31
<PAGE>

32
<PAGE>

Certain management considerations

33
<PAGE>

Financial information
Financial highlights

Financial highlights for the New Europe Fund and Latin America Fund are not
provided because these funds commenced operations after the close of the fiscal
year.

<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------
Period
Institutional Class 7/21/97
Year Ended 11/30 through
-------------------
Global Opportunities Fund 1998 11/30/97
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net Asset Value, Beginning of Period ($) 8.500
Income From Investment Operations
Net investment income ($) 0.056
Net realized & unrealized gains (losses) on investments ($) (0.326)
Total from investment operations ($) (0.270)
Less Distributions
Dividends from net investment income ($) none
Distributions from realized gains ($) none
Total distributions ($) none
Net asset value, end of period ($) 8.230
Total Return (%) (3.18)
Ratios and Supplemental Data:
Net asset value, end of period (000's omitted) ($) 2,903
Ratio of expenses to average daily net assets (%) 0.80
Ratio of net investment income to average daily net assets (%) 1.86
Portfolio turnover rate (%) 25
- ------------------------------------------------------------------------------------------------------
</TABLE>

34
<PAGE>

<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------
Institutional Class
Year Ended 11/30
-----------------------
Period
00/00/98
through
International Small Cap Fund 11/30/98
- -------------------------------------------------------------------------------------------------
<S> <C>
Net Asset Value, Beginning of Period ($)
Income From Investment Operations
Net investment income ($)
Net realized & unrealized gains (losses) on investments ($) Total from
investment operations ($) Less Distributions
Dividends from net investment income ($)
Distributions from realized gains ($)
Total distributions ($)
Net asset value, end of period ($) Total Return (%) Ratios and Supplemental
Data:
Net asset value, end of period (000's omitted) ($)
Ratio of expenses to average daily net assets (%)
Ratio of net investment income to average daily net assets (%)
Portfolio turnover rate (%)
</TABLE>

35
<PAGE>

How to read the financial highlights

Net investment income
Net investment income includes dividend and interest income earned from the
Fund's securities; it is after expenses have been deducted.

Net asset value (NAV)
This is the value of a mutual fund share, calculated by dividing the net assets
by the number of shares outstanding.

Net assets
Net assets represent the total value of all the assets in the Fund's portfolio,
less any liabilities, that are attributable to that class of the Fund.

(continues on page ___)

36
<PAGE>

Financial information (continued)

How to read the financial highlights
(begins on page ___)

Ratio of net investment income to average daily net assets
We determine this ratio by dividing net investment income by average net assets.

37
<PAGE>

Bonds Ratings

38
<PAGE>

How to use this glossary

Average maturity
An average of when the individual bonds and other debt securities held in a
portfolio will mature.

Capital
The amount of money you invest.

Capital appreciation
An increase in the value of an investment.

Compounding
Earnings on an investment's previous earnings.

Consumer Price Index (CPI)
Measurement of U.S. inflation; represents the price of a basket of commonly
purchased goods.

Corporate bond

A debt security issued by a corporation. See bond.

Cost basis
The original purchase price of an investment, used in determining capital gains
and losses.

Depreciation
A decline in an investment's value.

Diversification
The process of spreading investments among a number of different securities,
asset classes or investment styles to reduce the risks of investing.

39
<PAGE>

Dividend distribution
Payments to mutual fund shareholders of dividends passed along from the fund's
portfolio of securities.

Duration
A measurement of a fixed-income investment's price volatility. The larger the
number, the greater the likely price change for a given change in interest
rates.

Financial adviser
Financial professional (e.g., broker, banker, accountant, planner or insurance
agent) who analyzes clients' finances and prepares personalized programs to meet
objectives.

Inflation
The increase in the cost of goods and services over time. U.S. inflation is
frequently measured by changes in the Consumer Price Index (CPI).

Investment goal
The objective, such as long-term capital growth or high current income, that a
mutual fund pursues.

Management fee
The amount paid by a mutual fund to the investment adviser for management
services, expressed as an annual percentage of the fund' s average daily net
assets.

Maturity
The length of time until a bond issuer must repay the underlying loan principal
to bondholders.

Net asset value (NAV)
The daily dollar value of one mutual fund share. Equal to a fund's net assets
divided by the number of shares outstanding.

40
<PAGE>