DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS INC, N-30D, 1999-02-04

DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS INC
N-30D, 1999-02-04

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For International Diversification

Global &
International Funds

(various photos demonstrating service and guidance,
professional management and goals)

service and guidance

professional management

1998

Annual Report

goals

International Equity Fund
Global Bond Fund
Global Equity Fund
Emerging Markets Fund

DELAWARE
INVESTMENTS
- --------------
Philadelphia o London
<PAGE>

A TRADITION OF SOUND INVESTING

commitment

A Commitment
To Our Investors

(photo of globes)

(photo of illustration from
International Diversification Brochure)

Delaware Investments has a tradition of money management that dates back to
1929. We have a long and distinguished history of helping individuals and
institutions - including some of America's largest pension funds - reach their
financial goals.

Headquartered in Philadelphia, a block from the nation's oldest stock
exchange, the Delaware organization established its first mutual fund in 1938.
Delaware International Advisers Ltd., our international affiliate, was
established in 1990 and is headquartered in London. Delaware Investments offers
a full range of mutual funds. We also manage investments for variable annuities
and closed-end funds as well as offer a wide range of retirement plan services
for individuals and businesses.

Delaware manages approximately $45 billion in mutual fund assets and
institutional advisory accounts for more than half-a-million investors.

Complete information on any fund offered by Delaware Investments can be found in
each fund's current prospectus. Prospectuses for all funds offered by Delaware
Investments are available from your financial adviser. Please read the
prospectus carefully before you invest or send money.

Table of Contents

Letter to Shareholders Page 1
Portfolio Managers' Review Page 3
Performance Summary Page 12
Statements of Net Assets Page 16
Financial Highlights Page 26

Global & International
Funds' Objectives

International Equity Fund

Seeks to provide long-term growth without undue risk to principal by investing
primarily in international equity securities with the potential for capital
appreciation and income.

Global Bond Fund

Seeks to provide current income consistent with the preservation of principal by
investing primarily in international bonds that may also provide the potential
for capital appreciation.

Global Equity Fund

Seeks to achieve long-term total return by investing in global securities that
the Fund's management believes will provide the potential for capital
appreciation and income.

Emerging Markets Fund

Seeks to provide long-term capital appreciation by investing primarily in equity
securities of issuers located or operating in emerging market countries.

international
diversification

Jeffrey Nick Named Chairman

On December 17, 1998, Jeffrey J. Nick was named Chairman of the Delaware
Investments Family of Funds. He replaces Wayne A. Stork who has retired as
Chairman of the Board of Directors, but continues to serve as a Board Member.
Mr. Nick was named President and Chief Executive Officer of Delaware Investments
Family of Funds in October 1997. He has been CEO of Lincoln National Investment
Companies since October 1996 and previously managed Lincoln's operations in the
United Kingdom. Mr. Nick holds an MBA from the University of Chicago and a
bachelor of arts degree from Princeton University.

tradition

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December 18, 1998

Dear Shareholder:

IN FISCAL 1998, INTERNATIONAL

investors weathered what may have been the most serious economic storm since
World War II. The interdependent nature of the world economies was evident, as
the financial turmoil that began in Asia nearly 18 months ago became a global
problem, resulting in slowing economies, rising national debt levels and the
devaluation of numerous currencies.

As Asia's slumping nations began to devalue their currencies, exports from
healthier economies became more expensive to Asian consumers. This weakened an
already slack demand for foreign goods, services and raw materials supplied by
their trade partners. Economies in all parts of the world struggled as a result
and corporate earnings began to fall short of expectations.

In August, global markets declined sharply following the devaluation of
Russia's currency, as leaders in that country announced that they would not be
able to pay their bills, thereby forcing creditors to renegotiate the country's
debt obligations. This was the first time in recent market history that an
established government, normally considered to be a relatively secure issuer,
defaulted on its national debt.

The inability of Japan to reverse four consecutive quarters of economic
decline and Brazil's burgeoning national debt added to investor concern about
the safety of international investment portfolios. During fiscal 1998, many
international investors responded to this concern by reallocating assets in
their portfolio into the universally accepted safe-haven of U.S. Treasury Bonds,
sending thirty-year yields to their lowest level since 1967.

As the Pacific Rim recession made its mark on the world in 1998, results for
Delaware Investments global and international funds were disappointing. During
fiscal 1998, we attempted to reduce the volatility of our international
portfolios by concentrating on stocks and bonds in Europe, the Americas and the
more stable

Average Annual Total Returns
- --------------------------------------------------------------------------------
Periods Ended November 30, 1998
<TABLE>
<CAPTION>
12 Months Lifetime
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C>
International Equity Fund A Class (Est. 10/31/91) +8.75% +9.91%
Lipper International Equity Fund Average +10.43% (511 funds) +9.47% (65 funds)
Morgan Stanley Europe Australia Far East (EAFE) Index +16.44% +8.16%
- ---------------------------------------------------------------------------------------------------------
Global Bond Fund A Class (Est. 12/27/94) +5.47% +9.93%
Lipper Global Income Fund Average +5.55% (145 funds) +8.62% (91 funds)
Saloman Smith Barney World Government Bond Index +15.58% +10.53%
- ---------------------------------------------------------------------------------------------------------
Global Equity Fund A Class (Est. 12/27/94)* +8.83% +14.75%
Lipper Global Equity Fund Average +10.56% (217 funds) +14.12% (111 funds)
Morgan Stanley World Index +19.98% +17.49%
- ---------------------------------------------------------------------------------------------------------
Emerging Markets Fund A Class (Est. 6/10/96) -31.66% -13.27%
Lipper Emerging Markets Fund Average -25.32 (155 funds) -13.59% (105 funds)
Morgan Stanley Emerging Markets Free Index -24.56% -18.56%
- ---------------------------------------------------------------------------------------------------------
</TABLE>

All performance is at net asset value and assumes reinvestment of distributions.
For complete performance for all Fund Classes and expense information, including
waivers, see pages 12 to 15. The unmanaged Morgan Stanley World Index and
Salomon Smith Barney World Government Bond Index include U.S. market
performance. The Morgan Stanley Europe Australia Far East Index and the Morgan
Stanley Emerging Markets Free Index are also unmanaged. All returns stated in
U.S. dollars. Past performance does not guarantee future results.
* Effective July 21, 1998, Global Assets Fund was renamed Global Equity Fund and
its investment focus was changed. The Fund's Lipper Analytical Services peer
group was changed to the Global Equity Fund category at this time.
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Pacific Rim countries. In most cases, this strategy helped to preserve
principal, but also limited our funds' abilities to benefit from higher capital
appreciation available in other markets.

While the last 12 months have tested the resolve of international investors,
we believe there are reasons to anticipate improved performance in 1999. Central
banks in 22 countries lowered interest rates a combined total of 55 times in the
15 weeks following the devaluation of the ruble. This demonstrates the
willingness of international governments to add liquidity to financial markets,
thus stimulating their domestic economies. Also, the intervention of the
International Monetary Fund is having a dual benefit: providing struggling
economies with much-needed cash, while at the same time requiring them to
improve their fiscal policies.

THE INTERVENTION OF THE INTERNATIONAL MONETARY FUND IS HAVING A DUAL BENEFIT:
PROVIDING STRUGGLING ECONOMIES WITH MUCH-NEEDED CASH, WHILE AT THE SAME TIME
REQUIRING THEM TO IMPROVE THEIR FISCAL POLICIES.

During times of increased market volatility it is important to remember that
international investing requires patience and a long-term perspective. For their
lifetime periods, all four of Delaware Investments global and international
funds have outperformed their peers and provided investors with attractive
options for diversifying their overall investment portfolio.

In our opinion, the long-term performance of our global and international
funds demonstrates the effectiveness of Delaware's consistent value approach to
investing. Together with our investment professionals in London, we thank you
for your continued confidence in Delaware Investments.

Sincerely,

/s/ Jeffrey J. Nick
- -----------------------
Jeffrey J. Nick
Chairman, President and
Chief Executive Officer
Delaware Investments Family of Funds

global
discipline
<TABLE>
<CAPTION>
<S>
American investors measure
their results in U.S. dollars. <C> <C> <C> <C>
As this table shows, PERFORMANCE OF INTERNATIONAL MARKETS
international currency changes ---------------------------------------------------------------------
can either add or subtract December 31, 1997 - December 31, 1998
from returns. Delaware
Investments attempts to manage Return in Currency Effect Return in
currency fluctuations by Local Currency on Return U.S. Dollars
limiting our investments in ---------------------------------------------------------------------
countries where, in our Australia +12.68% -5.87% +6.07%
opinion, the currency is Canada +0.75% -6.84% -6.14%
extremely overvalued. If we do France +31.43% +7.69% +41.54%
make such an investment we may Germany +19.89% +7.96% +29.43%
attempt to reduce some of the Japan -8.87% +15.27% +5.05%
risk by using financial New Zealand -14.95% -9.02% -22.62%
strategies that allow us to United Kingdom +16.50% +1.12% +17.80%
convert the currency into U.S. ---------------------------------------------------------------------
dollars at a predetermined Source: Morgan Stanley. This illustration is not intended to represent
rate. past or future Delaware Investments fund performance. Past performance
is not a guarantee of future results.
</TABLE>

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PORTFOLIO MANAGERS' REVIEWS

INTERNATIONAL EQUITY FUND (photo of family on beach)
BY CLIVE A. GILLMORE AND NIGEL G. MAY
Senior Portfolio Managers,
Delaware International Advisers Ltd.

INVESTMENT STRATEGY

International Equity Fund focuses on dividend paying stocks in established
markets, with a heavy concentration in Western Europe. The Fund rounds out its
portfolio with select holdings in the Pacific Rim that meet our strict value
discipline. Since the Fund's inception in 1991, International Equity Fund has
invested for long-term growth by selecting stocks that appear to be selling
below their genuine worth.

strategy

Our research begins with an evaluation of the potential effects of a
country's currency fluctuations, inflation, local economy and political issues.
Next we look for companies that offer superior income and capital appreciation
potential. International Equity Fund's process for selecting stocks, known as
the dividend discount approach, has historically allowed the Fund to enjoy a
lower risk profile than many other international funds, as shown below.

International Equity Fund also attempts to reduce investment risk through
defensive currency hedging, a strategy which can help protect the dollar value
of the Fund's investments. In general, the Fund uses forward currency contracts
to limit the risk of loss should the hedged currency decline in value.

This year, we defensively hedged the British pound, due to our heavy exposure
to U.K. securities and our belief that the currency was somewhat overvalued. The
added expense of these currency contracts limited the Fund's total return but
also reduced the risk to capital of fluctuating exchange rates.

YOUR FUND'S ATTRACTIVE RISK PROFILE
MORNINGSTAR RISK SCORES
- --------------------------------------------------------------------------------
PERIODS ENDED NOVEMBER 30, 1998

International Equity Foreign Stock
Fund Fund Average
- --------------------------------------------------------------------------------
Three Years (324 funds) 0.68 0.72
Five Years (154 funds) 0.65 0.75
- --------------------------------------------------------------------------------

The average risk factor for all equity funds equals 1.00. Numbers greater than
1.00 indicate more relative risk, less than 1.00 indicates lower relative risk.
Past performance does not guarantee future results. To calculate risk,
Morningstar concentrates on those months during which a fund underperformed the
average return of a three-month U.S. Treasury bill's return and divides the
result by the total number of months in the rating period. The fund's average
monthly loss is then compared with the average monthly loss for the fund's
investment class. The resulting risk rating expresses how risky the fund is
relative to the average fund in the investment class. For example, the average
risk rating for the fund's investment class is 1.00, a Morningstar risk rating
of 1.35 reveals that the fund has been 35% riskier than the average fund in the
same category for the period considered.

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STRATEGIC POSITIONING

In fiscal 1998, the performance of International Equity Fund was curtailed by a
steep stock market decline during the third quarter. As the financial crisis in
Japan and other parts of Asia spread to Russia and Latin America, the pace of
investors "flight to quality" quickened. U.S. Treasuries became the investment
of choice for international investors seeking a safe haven during economic
turmoil.

Historically, International Equity Fund has maintained significant positions
in the United Kingdom and Western Europe. Throughout the first half of the
fiscal year, this emphasis helped boost the Fund's returns. During the summer,
however, our U.K. and Western European holdings suffered. As the pace of global
economic decline accelerated, market volatility increased and concerned
investors sold the stocks of even strong performing companies.

International Equity Fund returned a disappointing +8.75% for the 12 months
ended November 30, 1998 (for Class A shares at net asset value with
distributions reinvested). This return was just more than half the return of the
Fund's unmanaged benchmark, the Morgan Stanley Capital International Europe
Australia Far East (EAFE) Index. In fiscal 1998, your Fund's lower-risk approach
to investing led us to avoid financial services companies. In Continental
Europe, this market sector performed well for most of the year, and reduced the
Fund's performance relative to the Index. We avoided financial service companies
because we expect the European Monetary Union to reduce the regulation of
financial services companies. This could result in a consolidation in the
industry and limit the potential for long-term growth.

Your Fund has historically kept its holdings in Japanese stocks smaller than
the EAFE Index. In fiscal 1998, we took advantage of falling prices in the
Japanese market and added to our weighting throughout the fiscal year. Although
the Fund was underexposed to Japan, relative to the Index, we were more heavily
invested there than in the past. In some cases, we had a heavier weighting in
Japanese stocks than similar international funds. We increased the Fund's
Japanese position based on our belief that improved efforts to reform the
nation's banking system, falling interest rates and the strong financial
position of many Japanese consumers had improved the prospects for economic
recovery.

YOUR FUND'S LOW TURNOVER APPROACH
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TURNOVER 1993-1998

International Morningstar Foreign
Equity Fund Stock Fund Category
- --------------------------------------------------------------------------------
1993 24% 54% (161 funds)
1994 27% 55% (269 funds)
1995 21% 62% (345 funds)
1996 9% 63% (414 funds)
1997 8% 65% (439 funds)
1998 5% 70% (587 funds)*
- --------------------------------------------------------------------------------
* Through November 30, 1998 for Morningstar average.
Source: Morningstar Inc.
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OUTLOOK

In the coming year, we expect market volatility to remain high, reflecting
concerns over Asian, Russian and Latin American economic difficulties. We also
think that slowing U.S. earnings and problems with hedge funds could reduce the
return on international investments.

Despite a stock market rebound in the Far East last October and November, we
expect to keep our position in Japan relatively small. We do, however, believe
that Japan's current economic weakness is beginning to offer significant value
to investors and long-term potential for capital appreciation.

outlook

We are optimistic about a bank bailout package, approved by the Japanese
parliament in October of 1998. This 60 trillion yen ($509 billion) package uses
taxpayers' money to recapitalize failing banks, which should speed up the
process of economic recovery. We will continue to closely monitor the condition
of the Japanese economy in the coming year.

On January 1, 1999, the European Community introduced a new currency, the
"Euro." This unified European currency is expected to enhance trade in the
continent and ease investors concerns over currency fluctuations. The Euro
conversion is also expected to help reduce economic differences and facilitate
trade among the participating European members. While the initial reaction is
positive, issues of labor mobility, nationalism and the ability of the Central
European Bank to remain independent, create some uncertainty for long-term
prospects.

WE VIEW THE EURO CONVERSION AS A POSITIVE DEVELOPMENT THAT SHOULD HELP TO REDUCE
ECONOMIC DIFFERENCES AND FACILITATE TRADE AMONG THE PARTICIPATING EUROPEAN
MEMBERS.

INTERNATIONAL EQUITY FUND'S COUNTRY ALLOCATION VS.
MORGAN STANLEY CAPITAL INTERNATIONAL EUROPE AUSTRALIA FAR EAST INDEX
- --------------------------------------------------------------------------------
NOVEMBER 30, 1998

International Morgan Stanley Capital
Equity Fund International EAFE Index

United Kingdom 28.9% 21.7%
Australia/New Zealand 14.0% 2.9%
Japan 15.4% 21.3%
Netherlands/Belgium 9.2% 7.2%
Germany 11.4% 10.9%
France 8.9% 9.5%
Hong Kong 2.5% 2.0%
Singapore/Malaysia 1.1% 1.1%
Spain 6.5% 3.4%

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GLOBAL BOND FUND
BY IAN G. SIMS AND
CHRISTOPHER A. MOTH

Senior Portfolio Managers,
Delaware International Advisers Ltd.

INVESTMENT STRATEGY
Global Bond Fund relies on income potential as the key measure of value when
selecting bonds. Our research focuses on long-term factors, such as inflation
trends, which we believe will have a fundamental impact on long-term results.

The Fund also places a high priority on bond quality. As of fiscal year end,
the average bond quality of Global Bond Fund's portfolio was rated "AA+" by
Standard & Poor's.

In general, we look for bonds with an average maturity between five and 10
years. Bonds in this maturity range normally provide lower yields than longer
term investments. However, we believe this defensive posture allows the Fund to
earn an attractive level of income without the increased exposure to interest
rate fluctuations of longer term bonds. When investing overseas, your Fund
attempts to earn a rate of return that is substantially higher than the U.S.
inflation rate.

STRATEGIC POSITIONING
The U.S. bond market was strong throughout fiscal 1998. U.S. Treasury bonds, in
particular, enjoyed a year of unparalleled popularity. Investors seeking a safe
haven amid turbulent global economic conditions created strong demand for
Treasuries. Yields on long-term Treasury bonds fell to their lowest levels in
more than thirty years. Because our focus is on undervalued bonds and high
income potential, Global Bond Fund did not have large holdings of U.S.
Treasuries (8% of the Fund as of 11/30/98). Therefore, we did not fully
participate in the U.S. Treasury bond market rally.

Global Bond Fund's total return for the 12 months ended November 30, 1998 was
+5.47% (for Class A shares at net asset value with distributions reinvested) and

strategic
positioning

Global Bond Fund Portfolio Highlights
- --------------------------------------------------------------------------------
November 30, 1998

- --------------------------------------------------------------------------------
Current 30-Day SEC Yield 3.77%*
Highest Concentration - Western Europe 43.7% of net assets
Average Effective Duration 4.6 years
Average Effective Maturity 6.7 years
Average Quality AA+
- --------------------------------------------------------------------------------
* For Class A shares, measured according to Securities and Exchange Commission
guidelines, SEC 30-day yield was 3.27%, 3.28% and 4.27% for Class B, Class C
and Institutional Class shares. Performance information for all classes can be
found on pages 12 and 13.

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(photo of globes)

reflects the Fund's substantial underweighting in the U.S. bond market. During
the period, performance for the fund fell short of the benchmark Salomon Smith
Barney World Government Bond Index, which had 31% of assets allocated to
Treasuries at fiscal year end. Over its lifetime period, however, Global Bond
Fund has outperformed a peer group of similar funds (please see Average Annual
Total Returns table on page 1).

The currencies of Canada, New Zealand and Australia have historically been
closely linked to commodity prices. A slowing global economy reduced the prices
for commodities around the world. Currencies in these nations were weak against
the U.S. dollar making preservation of capital difficult. Global funds often
mitigate the risks of currency fluctuations by defensively hedging with forward
currency contracts. Global Bond Fund did not extensively hedge currencies over
the last 12 months because the expense of this strategy would have lowered the
Fund's income potential.

Over the last 12 months, Global Bond Fund favored investments in countries
outside of the U.S. because we viewed the U.S. bond market as overvalued. As of
fiscal year end, your Fund allocated the largest portion of its assets (20.2%)
to Canadian bonds. In our opinion, the Canadian dollar offered superior value
over the U.S. dollar, and a higher average annual real yield.

In South Africa, bond prices collapsed early in the summer following a 20%
devaluation of the rand. We took advantage of those exceptional bond market
values based on our belief that the South African Government was fundamentally
sound. Global Bond Fund benefited from yields that approached 15% and price
appreciation that occurred as the South African bond market began to recover in
late August and September.

OUTLOOK
We expect the widespread impact of the Asian recession to continue to suppress
economic growth both in the U.S. and abroad. This should keep inflation under
control and may provide an incentive for further interest rate cuts as nations
attempt to keep their economies out of recession.

GLOBAL BOND FUND BENEFITED FROM YIELDS THAT APPROACHED 15% AND PRICE
APPRECIATION THAT OCCURRED AS THE SOUTH AFRICAN BOND MARKET BEGAN TO RECOVER IN
LATE AUGUST AND SEPTEMBER.

While the current economic trend toward slowing global economic growth
suggests that inflation will remain benign in the near future, Global Bond Fund
applies a long-term outlook to investing. In our view, the current willingness
of governments to stimulate economic growth with lower interest rates could
eventually lead to higher inflation.

We will continue to limit the Fund's exposure to the risk of higher inflation
by maintaining a relatively short average effective maturity. We expect to
maintain our overweight position in U.S. inflation-indexed bonds, which pay a
coupon that rises with inflation. We view these fixed-income securities as
undervalued due to the potential for higher inflation in the future.

outlook

Global Bond Fund's allocation to corporate bonds in fiscal 1998 was less than
our peer group because we viewed the market as overpriced. However, recent
investor preference for safer investments has resulted in higher prices for
government bonds and better value in the corporate market. We expect to increase
our allocation to corporate bonds during the coming year.

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GLOBAL EQUITY FUND
BY ELIZABETH A. DESMOND
Senior Portfolio Manager,
Delaware International Advisers Ltd.
AND ROBERT L. ARNOLD
Senior Portfolio Manager,
Delaware Management Company

A NEW INVESTMENT STRATEGY

From its inception at the end of 1994 until July of this year, Global Equity
Fund combined multiple types of U.S. and foreign securities into one fund and
was called Global Assets Fund. We developed this strategy to provide
shareholders with an all-in-one approach to global investing.

Our research showed, however, that many investors and their advisers prefer
mutual funds that invest in only one or two asset classes. In July, we
eliminated the Fund's bond component in favor of stocks from around the world.
The Fund's new name, Global Equity Fund, reflects that focus.

Global Equity Fund's fundamental objective, to achieve long-term total
return, remains the same. The Fund's risk profile may increase as a result of
these modifications and the amount of dividend income available for distribution
is expected to be less. However, we believe the benefits of a potentially larger
shareholder base will improve the Fund's long-term performance.

STRATEGIC POSITIONING
Over the last 12 months, Global Equity Fund has weathered some of the most
volatile market conditions seen in world equity markets in recent history.
Market and Fund performance were tempered by sharp declines in most parts of the
world during the third quarter. Russia's devaluation of the ruble, Japan's
procrastination at reforming its financial institutions, continued weakness in
Asia, and evidence of economic problems in Latin America all contributed to the
downturn in global equity markets. Simultaneously, corporate profits across a
wide range of industries in all major markets declined.

strategy

Global Equity Fund provided a total return of +8.83% (for Class A shares at
net asset value with distributions reinvested) for the 12 months ended November
30, 1998. Despite a good absolute return, Fund performance modestly lagged a
peer group of similarly managed funds, and was disappointing in comparison to
the Fund's benchmark, the Morgan Stanley World Index. The Fund's avoidance of
U.S. growth stocks, which were some of the best performing

GLOBAL EQUITY FUND'S ASSET MIX
- --------------------------------------------------------------------------------
November 30, 1998

Cash & Other Assets 3.7%
Pacific Rim Stocks 18.3%
European Stocks 45.4%
U.S Stocks 32.6%

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investments during the fiscal year, helps explain this underperformance.

Following the same investment strategy as International Equity Fund (see
review on page 3), Global Equity Fund had a higher concentration of stocks from
the United Kingdom, Australia and New Zealand than the Morgan Stanley World
Index. We viewed these markets as offering global investors attractive value at
a prudent level of risk. Returns in these countries, particularly in the
commodity-driven markets of Australia and New Zealand, were below expectations
in fiscal 1998 due to weak demand for goods and raw materials from most of Asia
and other emerging nations.

While nearly 34% of the Fund's assets were invested in the U.S. equity market
at fiscal year end, this was less than the benchmark. As a value investor, we
believed that other international markets offered superior opportunities for
capital appreciation, especially considering our belief that the U.S. dollar was
overvalued. U.S. equities, however, performed well for the fiscal year. Because
we had a smaller percentage of assets in U.S. equities than the Morgan Stanley
World Index, we were unable to keep pace with its performance.

One of the Fund's better-performing securities during the fiscal year, GTE,
came from the U.S. telecommunications sector. GTE's price increased after it was
acquired by Bell Atlantic. Investors expected the synergy of these two companies
to result in enhanced cellular, long-distance and internet services.

The Fund's largest U.S. holding, Phillip Morris, also performed well during
fiscal 1998. Over the last several years, the possibility of increased
government regulation of the tobacco industry and reduced corporate earnings
resulted in lower prices for Phillip Morris stock. As a value manager, we saw
Phillip Morris as a company with strong fundamentals and the potential to
recover from short-term investor concerns. Global Equity Fund benefited from the
strong performance of Phillip Morris in 1998, as increased government regulation
became less likely and investors anticipated an earnings rebound.

WE EXPECT LOW YIELDS IN THE GLOBAL BOND MARKET TO SUPPORT THE PERFORMANCE OF
GLOBAL EQUITY INVESTMENTS DURING THE COMING YEAR.

OUTLOOK
The Morgan Stanley World Index gained back much of its third quarter losses
following interest rate cuts in the fall. While we expect market volatility to
continue, in our opinion, further sharp stock market declines are unlikely in
the near future. We are, however, concerned that rising labor costs and fiscal
problems in some financial markets could put additional pressure on corporate
profits.

outlook

Should economic conditions stabilize in Japan, as we believe they will, this
will speed the recovery process in worldwide economies. We also expect low
yields in the bond market to support the performance of global equity
investments during the coming year.

Our name has changed, but Global Equity Fund's long term, value-oriented
philosophy has not. We will continue to limit our investments in the U.S. and
Japan, where we believe stocks are still somewhat overvalued, and instead focus
the majority of Global Equity Fund's assets on developed markets such as
Australia, New Zealand, the U.K., and selected continental European markets.

(photo of couple talking
to financing advisor)
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EMERGING MARKETS FUND
BY CLIVE A. GILLMORE, ROBERT
AKESTER AND JOSHUA BROOKS
Senior Portfolio Managers,
Delaware International Advisers Ltd.

INVESTMENT STRATEGY
Emerging Markets Fund focuses on companies with attractive performance records
in developing markets. The Fund follows a value discipline and exhibits a higher
dividend yield and lower price-to-earnings and price-to-book value ratios than
its benchmark, the Morgan Stanley Emerging Markets Free Index. In this
underresearched asset class there are greater than usual opportunities to
discover companies that are relatively unknown or temporarily out of favor which
we feel have the potential to rise in value to their actual worth.

While the Fund is focused on value stocks, our analysis uses a discounted
cash flow approach to identify stocks where growth is underpriced. Given the
higher degree of risk associated with investing in emerging markets, your Fund
maintained a portfolio that was invested in 71 different companies from 24
emerging markets countries at the end of the fiscal year. Over the long term we
believe this broad investment scope helps reduce investment risk.

STRATEGIC POSITIONING
In fiscal 1998, Asia's financial recession spread to nearly every corner of the
world and led to disappointing performance in most investment sectors. For
emerging markets investors, the impact was nothing short of profound. Over the
last six months, Russia devalued the ruble and defaulted on certain of its debt
obligations and Brazil's escalating budget deficit resulted in a cash exodus
from the country. These events sent stock prices in emerging market nations
plummeting.

In this environment, the preservation of capital became virtually impossible
for emerging market funds during 1998. For the 12 months ended November 30,
1998, Emerging Markets Fund (for Class A shares at net asset value with
distributions reinvested) lost 31.66% of its net asset value. This loss was
higher than both the Fund's benchmark index and the average return of other
funds with similar investment objectives.

strategic
positioning

EMERGING MARKETS FUND: FOCUSING ON LATIN AMERICA AND EUROPE
- --------------------------------------------------------------------------------
COUNTRY/REGION ALLOCATION AS OF NOVEMBER 30, 1998

U.S. Cash Equivalents 1.8%
Latin America* 37.8%
Eastern Europe & Russia 11.0%
Middle East** 7.3%
India 4.1%
China (Hong Kong) 8.4%
Taiwan 2.1%
Thailand 6.2%
Malaysia 6.5%
Other Pacific Rim*** 1.6%
South Africa 13.2%

* Argentina, Brazil, Chile, Mexico, Peru ** Egypt, Israel, Turkey.
*** Indonesia, South Korea.

<PAGE>

for international
diversification
11

(photo of glasses, pen & keyboard)

Disappointing performance of the Fund over the past 12 months can be
attributed in part to the underperformance of value stocks relative to growth
stocks and of smaller companies relative to larger. This anomaly is expected to
be corrected in due course once short-term concerns subside and investors begin
to focus more on the fundamental worth of companies.

At fiscal year end, the largest percentage of your Fund's assets was invested
in Brazil. Toward the end of the summer, a growing budget deficit and heavy
government borrowing reawoke fears that Brazil, like Russia, would devalue its
currency. Stock prices collapsed as investors pulled their assets out of the
country.

While progress has been made, as of your Fund's fiscal year end, governmental
attempts to reform fiscal policies in Brazil continued to meet with resistance.
President Fernando Henrique Cardoso has, however, demonstrated a sincere
commitment to lower the nation's budget deficit by cutting expenditures and
increasing tax revenue. Despite concerns about the Brazilian government
defaulting on its loans and fear of currency devaluation, the positive news is
that stock prices remained inexpensive. Even defensive utility stocks with
strong balance sheets were selling at half of their book value. While the
performance of Emerging Markets Fund holdings in Brazil had a negative impact in
fiscal 1998, we believe the fund is well-positioned for a potential rebound in
the next few years.

OUTLOOK
Emerging Markets Fund shareholders had little to cheer about in fiscal 1998, but
we see a silver lining to the dismal 1998 performance of emerging markets
investments. In our opinion, stocks in Brazil and other emerging markets now
offer investors compelling value and the potential for substantial gains as
world economies begin to stabilize.

Governments in the developed countries are showing a willingness to provide
additional liquidity, through lower interest rates, to help stimulate slowing
economies. The International Monetary Fund is also helping emerging countries
reduce the severity of financial difficulties before they escalate, by offering
standby lines of credit. We believe IMF intervention will help reduce investors
concerns about currency devaluations and loan defaults, which should reduce
capital outflows from emerging market nations.

IN OUR OPINION, STOCKS IN BRAZIL AND OTHER EMERGING MARKETS NOW OFFER INVESTORS
COMPELLING VALUE AND THE POTENTIAL FOR SUBSTANTIAL GAINS AS WORLD ECONOMIES
BEGIN TO STABILIZE.

In our view, underperformance in emerging markets has been intensified this
year by speculation and emotion. As global economic turmoil intensified, many
investors pulled their money out of emerging markets, without regard to the
performance of specific companies. We believe this has created vast
opportunities to purchase good companies at exceptional prices. In the coming
year, we expect short-term volatility to continue, but we remain convinced that
for investors with a horizon of at least five to seven years and the ability to
accept the special risks involved with developing countries, emerging markets
investments offer good opportunities for long-term capital appreciation.

outlook

<PAGE>

for international
diversification
12

PERFORMANCE SUMMARY

INTERNATIONAL EQUITY FUND PERFORMANCE
- --------------------------------------------------------------------------------
GROWTH OF A $10,000 INVESTMENT
OCTOBER 31, 1991 TO NOVEMBER 30, 1998
- --------------------------------------------------------------------------------
Morgan Stanley Capital
International Equity International EAFE
Fund A Class Index
Oct. '91 $ 9,425 $10,000
Nov. '91 $ 9,095 $ 9,536
Nov. '92 $ 9,082 $ 8,794
Nov. '93 $11,178 $10,962
Nov. '94 $12,209 $12,622
Nov. '95 $13,207 $13,619
Nov. '96 $16,405 $15,265
Nov. '97 $16,941 $15,246
Nov. '98 $18,423 $17,804

Chart assumes $10,000 invested on October 31, 1991, and includes the effect of
the 5.75% maximum front-end sales charge and the reinvestment of all
distributions. Performance of other classes of International Equity Fund will
vary due to differing charges and expenses. Past performance does not guarantee
future results.

INTERNATIONAL EQUITY FUND
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS THROUGH NOVEMBER 30, 1998

Lifetime Five Years One Year
- --------------------------------------------------------------------------------
Class A (est. 10/31/91)
Excluding Sales Charge +9.91% +10.51% +8.75%
Including Sales Charge +9.00% +9.20% +2.52%
- --------------------------------------------------------------------------------
Class B (est. 9/6/94)
Excluding Sales Charge +7.57% +8.03%
Including Sales Charge +7.20% +3.03%
- --------------------------------------------------------------------------------
Class C (est. 11/29/95)
Excluding Sales Charge +10.81% +8.04%
Including Sales Charge +10.81% +7.04%

Returns reflect reinvestment of distributions and any applicable sales charges
as noted below. Return and share value will fluctuate so that shares, when
redeemed, may be worth more or less than the original share price. Past
performance does not guarantee future results. Performance excluding sales
charges for B and C Classes assumes contingent sales charges did not apply or
the investment was not redeemed. Performance excluding sales charges for Class
A, assumes the front-end sales charge did not apply.

Voluntary expense limitations were in effect for each Fund for the periods
shown. Performance would have been lower without the limitations.

Class A shares have a maximum front-end sales charge of 5.75% and a 12b-1 fee.
Global Bond Fund has a front-end maximum sales charge of 4.75% and a 12b-1 plan.
Class B shares do not carry a front-end sales charge, but are subject to a 1%
annual distribution and service fee, and a deferred sales charge of up to 5% if
redeemed before the end of the sixth year.

Class C shares have a 1% annual distribution and service fee. If shares are
redeemed within 12 months, a 1% contingent deferred sales charge applies.
Institutional Class shares for each Fund, which are available without sales or
asset-based distribution charges only to certain eligible institutional
accounts, provided the following returns for the listed periods ended November
30, 1998.
Lifetime Five Years One Year
International Equity Fund* +10.20% +10.83% +9.10%
Global Bond Fund** +10.27% +5.88%
Global Equity Fund** +15.08% +9.07%
Emerging Markets Fund*** -12.98% -31.55%

* Initially offered on 11/9/92. Lifetime performance commenced 10/31/91. For
periods prior to 11/9/92, performance is based on A Class performance,
adjusted to eliminate the sales charges, but not Class A's asset-based
distribution charge.
** Initially offered on 12/27/94.
*** Initially offered 6/10/96.
<PAGE>

for international
diversification
13

GLOBAL BOND FUND PERFORMANCE
- --------------------------------------------------------------------------------
GROWTH OF A $10,000 INVESTMENT, DISTRIBUTIONS REINVESTED
DECEMBER 27, 1994 TO NOVEMBER 30, 1998

Global Bond Fund A Class Salomon Brothers World
Govt Bond Index
Dec. '94 $ 9,524 $10,000
Mar. '95 $ 9,772 $11,093
Jun. '95 $10,332 $11,686
Sep. '95 $10,934 $11,563
Dec. '95 $11,512 $11,904
Mar. '96 $11,544 $11,681
Jun. '96 $11,794 $11,729
Sep. '96 $12,356 $12,050
Dec. '96 $12,878 $12,336
Mar. '97 $12,498 $11,826
Jun. '97 $12,827 $12,184
Sep. '97 $13,074 $12,340
Dec. '97 $12,964 $12,366
Mar. '98 $13,072 $12,463
Jun. '98 $13,035 $12,710
Sep. '98 $13,562 $13,768
Nov. '98 $13,827 $13,976

Chart assumes $10,000 invested on December 27, 1994, and includes the effect of
the 4.75% maximum front-end sales charge and the reinvestment of all
distributions. Performance of other classes of Global Bond Fund will vary due to
differing charges and expenses. Past performance does not guarantee future
results.

Global Bond Fund
- --------------------------------------------------------------------------------
Average Annual Total Returns Through November 30, 1998

Lifetime One Year
Class A (est. 12/27/94)
Excluding Sales Charge +9.93% +5.47%
Including Sales Charge +8.57% +0.45%
- --------------------------------------------------------------------------------
Class B (est. 12/27/94)
Excluding Sales Charge +9.15% +4.59%
Including Sales Charge +8.55% +0.59%
- --------------------------------------------------------------------------------
Class C (est. 11/29/95)
Excluding Sales Charge +5.98% +4.71%
Including Sales Charge +5.98% +3.71%

Returns reflect reinvestment of distributions and any applicable sales charges
as noted on page 12. Return and share value will fluctuate so that shares, when
redeemed may be worth more or less than the original share price. Past
performance does not guarantee future results. Performance excluding sales
charges for B and C Classes assumes contingent sales charges did not apply or
the investment was not redeemed. Performance excluding sales charges for Class A
assumes the front-end sales charge did not apply.

See page 12 for important additional information about each class and
Institutional Class performance.

<PAGE>

for international
diversification
14

GLOBAL EQUITY FUND PERFORMANCE
- --------------------------------------------------------------------------------
GROWTH OF A $10,000 INVESTMENT, DISTRIBUTIONS REINVESTED
DECEMBER 27, 1994 TO NOVEMBER 30, 1998

Morgan Stanley Capital
Global Equity Fund A Class International World Index
Dec. '94 $ 9,425 $10,000
Mar. '95 $10,075 $10,472
Jun. '95 $10,693 $10,942
Sep. '95 $11,305 $11,567
Dec. '95 $11,744 $12,132
Mar. '96 $12,083 $12,640
Jun. '96 $12,404 $13,021
Sep. '96 $12,778 $13,210
Dec. '96 $13,564 $13,830
Mar. '97 $13,574 $13,884
Jun. '97 $14,883 $15,990
Sep. '97 $15,241 $16,463
Dec. '97 $15,062 $16,074
Mar. '98 $16,362 $18,392
Jun. '98 $16,257 $18,783
Sep. '98 $14,696 $16,547
Nov. '98 $16,183 $19,122

Chart assumes $10,000 invested on December 27, 1994, and includes the effect of
the 5.75% maximum front-end sales charge and the reinvestment of all
distributions. Performance of other classes of Global Equity Fund will vary due
to differing charges and expenses. Past performance does not guarantee future
results.

Global Equity Fund*
- --------------------------------------------------------------------------------
Average Annual Total Returns Through November 30, 1998

Lifetime One Year
- --------------------------------------------------------------------------------
Class A (est. 12/27/94)
Excluding Sales Charge +14.75% +8.83%
Including Sales Charge +13.04% +2.55%
- --------------------------------------------------------------------------------
Class B (est. 12/27/94)
Excluding Sales Charge +13.94% +7.97%
Including Sales Charge +13.41% +3.13%
- --------------------------------------------------------------------------------
Class C (est. 11/29/95)
Excluding Sales Charge +11.26% +8.00%
Including Sales Charge +11.26% +7.03%

See page 12 for important additional information and Institutional Class
performance.

* Effective July 21, 1998, the Fund was renamed Global Equity Fund (formerly
Global Assets Fund) and its investment focus was changed, eliminating the
Fund's bond component in favor of stocks.

<PAGE>

for international
diversification
15

EMERGING MARKETS FUND PERFORMANCE
- --------------------------------------------------------------------------------
GROWTH OF A $10,000 INVESTMENT, DISTRIBUTIONS REINVESTED
JUNE 10, 1996, TO NOVEMBER 30, 1998
Morgan Stanley Capital
International
Emerging Markets Fund A Class Emerging Markets Free Index
Jun. '96 $ 9,425 $10,000
Jun. '96 $ 9,472 $10,000
Jul. '96 $ 9,067 $ 9,298
Aug. '96 $ 9,463 $ 9,523
Sep. '96 $ 9,491 $ 9,592
Oct. '96 $ 9,312 $ 9,329
Nov. '96 $ 9,397 $ 9,530
Dec. '96 $ 9,544 $ 9,507
Jan. '97 $10,457 $10,147
Feb. '97 $10,894 $10,575
Mar. '97 $10,694 $10,271
Apr. '97 $10,970 $10,253
May. '97 $11,407 $10,518
Jun. '97 $12,111 $11,059
Jul. '97 $12,253 $11,203
Aug. '97 $11,331 $ 9,764
Sep. '97 $11,826 $10,020
Oct. '97 $10,124 $ 8,368
Nov. '97 $ 9,696 $ 8,057
Dec. '97 $ 9,671 $ 8,251
Jan. '98 $ 8,910 $ 7,604
Feb. '98 $10,148 $ 8,398
Mar. '98 $10,330 $ 8,762
Apr. '98 $10,340 $ 8,667
May. '98 $ 8,981 $ 7,479
Jun. '98 $ 7,641 $ 6,695
Jul. '98 $ 7,783 $ 6,907
Aug. '98 $ 5,490 $ 4,910
Sep. '98 $ 5,804 $ 5,221
Oct. '98 $ 6,149 $ 5,771
Nov. '98 $ 6,626 $ 6,379

Chart assumes $10,000 invested on June 10, 1996, and includes the effect of the
5.75% maximum front-end sales charge and the reinvestment of all distributions.
Performance of other classes of Emerging Markets Fund will vary due to differing
charges and expenses. Past performance does not guarantee future results

EMERGING MARKETS FUND
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS THROUGH NOVEMBER 30, 1998

Lifetime One Year
- --------------------------------------------------------------------------------
Class A (est. 6/10/96)
Excluding Sales Charge -13.27% -31.66%
Including Sales Charge -15.32% -35.58%
- --------------------------------------------------------------------------------
Class B (est. 6/10/96)
Excluding Sales Charge -13.84% -32.11%
Including Sales Charge -14.82% -35.29%
- --------------------------------------------------------------------------------
Class C (est. 6/10/96)
Excluding Sales Charge -13.89% -32.21%
Including Sales Charge -13.89% -32.85%

See page 12 for important additional information and Institutional Class
performance.

<PAGE>

16 for international diversification

FINANCIAL STATEMENTS

DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS, INC.
INTERNATIONAL EQUITY SERIES
STATEMENT OF NET ASSETS

NOVEMBER 30, 1998
- --------------------------------------------------------------------------------
NUMBER MARKET VALUE
OF SHARES (U.S. $)
-----------------------------
COMMON STOCK 97.87%
AUSTRALIA 11.12%
Amcor .................................. 1,380,000 $ 6,012,087
+CSR .................................... 2,482,874 5,969,531
Fosters Brewing Group .................. 4,561,165 11,939,841
+National Australia Bank ................ 652,518 9,757,105
Orica .................................. 734,300 4,056,420
-----------
37,734,984
-----------
BELGIUM - 2.13%
Electrabel ............................. 18,679 7,210,938
-----------
7,210,938
-----------
FRANCE - 8.90%
+Alcatel Alsthom ........................ 58,531 7,749,516
Compagnie de Saint Gobain .............. 45,975 6,799,419
Elf Aquitaine .......................... 61,865 7,722,573
Societe Generale ....................... 50,118 7,906,286
-----------
30,177,794
-----------
GERMANY - 11.36%
Bayer .................................. 182,090 7,782,129
Bayerische Vereinsbank ................. 98,800 8,894,070
Continental ............................ 119,500 2,990,939
+RWE .................................... 168,000 8,945,191
Siemens ................................ 139,900 9,918,237
-----------
38,530,566
-----------
HONG KONG - 2.51%
Hong Kong Electric ..................... 1,482,000 4,928,834
Wharf Holdings ......................... 2,258,000 3,572,554
-----------
8,501,388
-----------
JAPAN - 15.42%
Canon .................................. 418,000 9,230,444
Eisai .................................. 734,000 11,322,102
Hitachi ................................ 620,000 3,729,815
+Kinki Coca-Cola Bottling ............... 183,000 2,124,538
Koito Manufacturing .................... 679,000 2,833,416
+Matsushita Electric .................... 704,000 11,316,581
West Japan Railway ..................... 2,720 11,769,920
-----------
52,326,816
-----------
MALAYSIA - 0.30%
Oriental Holdings Berhad ............... 320,000 328,205
Sime Darby Berhad ...................... 966,000 674,485
-----------
1,002,690
-----------
<PAGE>

NUMBER MARKET VALUE
OF SHARES (U.S. $)
-----------------------------
COMMON STOCK (Continued)

NETHERLANDS - 7.06%
Elsevier ..................................... 573,000 $ 7,530,986
Koninklijke Van Ommeren ...................... 66,000 2,108,129
Royal Dutch Petroleum ........................ 140,280 6,728,445
Unilever ..................................... 97,120 7,602,796
-----------
23,970,356
-----------
NEW ZEALAND - 2.92%
+Carter Holt Harvey ........................... 1,117,300 1,062,018
+Telecom Corporation of New Zealand ........... 2,079,920 8,847,387
-----------
9,909,405
-----------
SINGAPORE - 0.80%
Jardine Matheson Holdings Limited ............ 802,287 2,727,776
-----------
2,727,776
-----------
SPAIN - 6.47%
+Banco Central Hispanoamericano ............... 750,111 8,644,106
Iberdrola .................................... 215,000 3,567,162
Telefonica de Espana ......................... 206,727 9,730,012
-----------
21,941,280
-----------
UNITED KINGDOM - 28.88%
Bass ......................................... 676,607 9,354,594
BG ........................................... 1,245,000 8,560,309
Blue Circle Industries ....................... 1,713,254 8,691,832
Boots ........................................ 607,500 9,852,450
British Airways .............................. 1,194,570 8,238,200
Cable & Wireless ............................. 820,000 10,484,797
*Centrica ..................................... 935,000 1,939,832
GKN .......................................... 775,800 8,588,489
Great Universal Stores ....................... 740,200 7,718,104
Rio Tinto .................................... 724,700 8,530,936
Taylor Woodrow ............................... 2,780,825 7,386,590
Unigate ...................................... 1,103,000 8,653,076
-----------
97,999,209
-----------
Total Common Stock (cost $298,964,329) ....... 332,033,202
-----------

WARRANTS - 0.00%
HONG KONG - 0.00%
*Wharf Holdings 12/31/99 ...................... 112,900 13,269
-----------
Total Warrants (cost $0) ..................... 13,269
-----------
<PAGE>

for international diversification 17

INTERNATIONAL EQUITY SERIES
STATEMENT OF NET ASSETS (CONTINUED)
- --------------------------------------------------------------------------------

PRINCIPAL MARKET VALUE
AMOUNT (U.S. $)
--------------------------
REPURCHASE AGREEMENTS 3.86%
With Chase Manhattan 5.25% 12/01/98
(dated 11/30/98, collateralized by
$2,859,000 U.S. Treasury Notes 6.25%
due 10/31/01, market value $2,996,999
and $1,830,000 U.S. Treasury Notes
5.50% due 02/28/03, market value
$1,911,029) ....................................... $4,808,000 $4,808,000

With J.P. Morgan Securities 5.15% 12/01/98
(dated 11/30/98, collateralized by
$975,000 U.S. Treasury Notes 5.75%
due 10/31/00, market value $999,157
and $1,172,000 U.S. Treasury Notes 7.50%
due 11/15/01, market value $1,266,268
and $1,429,000 U.S. Treasury Notes
6.375% due 08/15/02, market value
$1,536,577) ....................................... 3,717,000 3,717,000

With PaineWebber 5.29% 12/01/98
(dated 11/30/98, collateralized by
$2,859,000 U.S. Treasury Bills due
02/18/99, market value $2,830,884
and $1,429,000 U.S. Treasury Notes
5.875% due 11/15/99, market value
$1,449,012 and $376,000 U.S. Treasury
Notes 5.875% due 02/15/00,
market value $387,507) ............................ 4,574,000 4,574,000
-----------
Total Repurchase Agreements
(cost $13,099,000) ................................ 13,099,000
-----------

TOTAL MARKET VALUE OF SECURITIES 101.73%
(cost $312,063,329) ......................................... $345,145,471
LIABILITIES NET OF RECEIVABLES AND OTHER ASSETS (1.73%) ....... (5,862,740)
-----------

NET ASSETS APPLICABLE TO 22,115,430 SHARES ($0.01 PAR
VALUE) OUTSTANDING 100.00% ................................. $339,282,731
============

NET ASSET VALUE INTERNATIONAL EQUITY SERIES A CLASS
($122,609,433 / 7,997,091 shares) ........................... $15.33
======
NET ASSET VALUE INTERNATIONAL EQUITY SERIES B CLASS
($37,774,582 / 2,472,927 shares) ............................ $15.28
======
NET ASSET VALUE INTERNATIONAL EQUITY SERIES C CLASS
($14,075,899 / 922,230 shares) .............................. $15.26
======
NET ASSET VALUE INTERNATIONAL EQUITY SERIES INSTITUTIONAL CLASS
($164,822,817 / 10,723,182 shares) .......................... $15.37
======
<PAGE>

COMPONENTS OF NET ASSETS AT NOVEMBER 30, 1998:
Common stock, $0.01 par value, 500,000,000 shares authorized
to the Fund with 50,000,000 shares allocated to International
Equity Series A Class, 25,000,000 shares allocated to
International Equity Series B Class, 25,000,000 shares allocated
to International Equity Series C Class, and 50,000,000 shares
allocated to International Equity Series Institutional
Class ......................................................... $305,048,157
Undistributed net investment income** ............................... 3,416,009
Accumulated net realized loss on investments ........................(2,837,854)
Net unrealized appreciation of investments and foreign currencies ...33,656,419
------------
Total net assets $339,282,731
============
- ----------------------
* Non-income producing security for the year ended November 30, 1998.
** Undistributed net investment income includes net realized gains (losses) on
foreign currencies. Net realized gains (losses) on foreign currencies are
treated as net investment income in accordance with provisions of the
Internal Revenue Code.
+ Security is partially or fully on loan.

NET ASSET VALUE AND OFFERING PRICE PER SHARE
INTERNATIONAL EQUITY SERIES

Net asset value A Class (A) .......................................... $15.33

Sales charge (5.75% of offering price or
6.13% of the amount invested per share) (B) ........................ 0.94
-------
Offering price ....................................................... $16.27
=======
- ----------------------
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon redemption or repurchase of shares.

(B) See How to Buy Shares in the current prospectus for purchases of $50,000 or
more.

See accompanying notes
<PAGE>

18 for international diversification

DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS, INC.
GLOBAL BOND SERIES
STATEMENT OF NET ASSETS
NOVEMBER 30, 1998
- --------------------------------------------------------------------------------

PRINCIPAL MARKET VALUE
AMOUNT* (U.S. $)
------------------------

BONDS - 97.50%
AUSTRALIA - 13.93%
Australian Government 6.75% 11/15/06 ............... A$800,000 $561,053
Australian Government 7.00% 04/15/00 ............... 500,000 323,979
Federal National Mortgage Association 5.75%
09/05/00 ........................................ 600,000 382,300
New South Wales Treasury 6.50% 05/01/06 ............ 600,000 404,899
New South Wales Treasury 7.00% 02/01/00 ............ 800,000 514,479
Queensland Treasury 8.00% 08/14/01 ................. 750,000 508,380
------------
2,695,090
------------
CANADA - 20.20%
Abbey National Treasury Service 7.00% 12/31/99 ..... C$1,050,000 697,546
Government of Canada 7.50% 03/01/01 ................ 500,000 344,359
Government of Canada 8.75% 12/01/05 ................ 600,000 478,302
Government of Canada 10.25% 03/15/14 ............... 1,200,000 1,197,785
Japan Highway 7.875% 09/27/02 ...................... 500,000 352,136
KFW International Finance 6.50% 12/28/01 ........... 120,000 80,844
Kingdom of Norway 8.375% 01/27/03 .................. 120,000 86,713
Ontario Hydro 10.00% 03/19/01 ...................... 470,000 339,053
Ontario Hydro 10.875% 03/29/99 ..................... 500,000 331,961
------------
3,908,699
------------
GERMANY - 9.76%
Baden Wurt L-Finance 6.625% 08/20/03 ............... Dem75,000 49,530
Bundesrepublik Deutschland 6.00% 07/04/07 .......... 900,000 606,605
Bundesrepublik Deutschland 6.25% 01/04/24 .......... 350,000 248,133
Deutsche Pfandbrief Hypotheken 5.625%
02/07/03 ........................................ 200,000 126,525
Republic of Austria 7.25% 05/03/07 ................. 1,200,000 858,003
------------
1,888,796
------------
NETHERLANDS - 10.16%
Netherlands Government 7.50% 01/15/23 .............. Nlg700,000 505,459
Netherlands Government 8.25% 09/15/07 .............. 900,000 612,881
Netherlands Government 9.00% 05/15/00 .............. 1,500,000 847,022
------------
1,965,362
------------
NEW ZEALAND - 13.22%
Government of New Zealand 6.50% 02/15/00 ........... NZ$700,000 375,446
Government of New Zealand 7.00% 07/15/09 ........... 200,000 117,476
Government of New Zealand 8.00% 02/15/01 ........... 500,000 278,931
Government of New Zealand 8.00% 04/15/04 ........... 1,500,000 882,575
Government of New Zealand 8.00% 11/15/06 ........... 600,000 364,723
Government of New Zealand 10.00% 03/15/02 .......... 550,000 330,202
Ontario Province 6.25% 12/03/08 .................... 400,000 207,644
------------
2,556,997
------------
SOUTH AFRICA - 4.58%
Republic of South Africa 12.50% 01/15/02 ........... Sa3,700,000 590,556
Republic of South Africa 13.00% 08/31/10 ........... 2,000,000 295,851
------------
886,407
------------
<PAGE>

PRINCIPAL MARKET VALUE
AMOUNT* (U.S. $)
------------------------
BONDS (CONTINUED)
SWEDEN - 10.91%
Swedish Export Credit 6.50% 06/05/01 ............... Sk3,500,000 $453,207
Swedish Government 8.00% 08/15/07 .................. 1,000,000 155,338
Swedish Government 9.00% 04/20/09 .................. 6,800,000 1,153,786
Swedish Government 10.25% 05/05/03 ................. 1,000,000 153,155
Swedish Government 13.00% 06/15/01 ................. 1,300,000 194,505
------------
2,109,991
------------
SWITZERLAND - 2.89%
Government of Switzerland 4.50% 07/08/02 ........... Chf300,000 235,088
Government of Switzerland 4.50% 10/07/04 ........... 400,000 324,863
------------
559,951
------------
UNITED STATES - 11.85%
J. Sainsbury 6.25% 03/27/02 ........................ $100,000 101,688
Korea Electric Power 6.375% 12/01/03 ............... 200,000 164,500
Matsushita Electric 7.25% 08/01/02 ................. 200,000 209,250
Republic of Finland 7.875% 07/28/04 ................ 200,000 225,250
U.S. Treasury Inflation Index Notes 3.375%
01/15/07 ........................................ 412,532 401,961
U.S. Treasury Inflation Index Notes 3.625%
07/15/02 ........................................ 357,091 356,645
U.S. Treasury Inflation Index Notes 3.625%
01/15/08 ........................................ 606,804 600,926
U.S. Treasury Notes 6.375% 08/15/27 ................ 200,000 231,837
------------
2,292,057
------------
Total Bonds (cost $19,050,249) ..................... 18,863,350
------------
REPURCHASE AGREEMENTS 2.49%
With Chase Manhattan 5.25% 12/01/98
(dated 11/30/98, collateralized by $105,000
U.S. Treasury Notes 6.25% due 10/31/01,
market value $110,280 and $67,000 U.S.
Treasury Notes 5.50% due 02/28/03,
market value $70,320) ........................... 177,000 177,000
With J.P. Morgan Securities 5.15% 12/01/98
(dated 11/30/98, collateralized by $36,000
U.S. Treasury Notes 5.75% due 10/31/00,
market value $36,766 and $43,000 U.S.
Treasury Notes 7.50% due 11/15/01,
market value $46,594 and $53,000
U.S. Treasury Notes 6.375% due 08/15/02,
market value $56,541) ........................... 137,000 137,000
With PaineWebber 5.29% 12/01/98
(dated 11/30/98, collateralized by $105,000
U.S. Treasury Bills due 02/18/99, market value
$104,167 and $53,000 U.S. Treasury Notes
5.875% due 11/15/99, market value $53,319
and $14,000 U.S. Treasury Notes 5.875% due
02/15/00, market value $14,259) ................. 168,000 168,000
------------
Total Repurchase Agreements (cost $482,000) ........ 482,000
------------

<PAGE>

for international diversification 19

GLOBAL BOND SERIES
STATEMENT OF NET ASSETS (CONTINUED)
- --------------------------------------------------------------------------------

MARKET VALUE
(U.S. $)
--------------------

TOTAL MARKET VALUE OF SECURITIES 99.99%
(cost $19,532,249) ........................................... $19,345,350
RECEIVABLES AND OTHER ASSETS NET OF LIABILITIES 0.01% .......... 2,156
-----------
NET ASSETS APPLICABLE TO 1,770,005 SHARES ($0.01 PAR
VALUE) OUTSTANDING 100.00% .................................. $19,347,506
===========
NET ASSET VALUE GLOBAL BOND SERIES A CLASS
($4,684,077 / 428,259 SHARES) ................................ $10.94
======
NET ASSET VALUE GLOBAL BOND SERIES B CLASS
($1,187,910 / 108,646 SHARES) ................................ $10.93
======
NET ASSET VALUE GLOBAL BOND SERIES C CLASS
($538,807 / 49,534 SHARES) ................................... $10.88
======
NET ASSET VALUE GLOBAL BOND SERIES INSTITUTIONAL CLASS
($12,936,712 / 1,183,566 shares) ............................. $10.93
======

COMPONENTS OF NET ASSETS AT NOVEMBER 30, 1998:
Common stock, $0.01 par value, 500,000,000 shares
authorized to the Fund with 50,000,000 shares
allocated to Global Bond Series A Class, 25,000,000
shares allocated to Global Bond Series B Class, 25,000,000
shares allocated to Global Bond Series C Class, and
50,000,000 shares allocated to Global Bond Series
Institutional Class .......................................... $19,352,694
Distributions in excess of net investment income** .............. (19,805)
Accumulated net realized gain on investments .................... 197,577
Net unrealized depreciation of investments and foreign currencies (182,960)
-----------
Total net assets ................................................ $19,347,506
===========
- ----------------------
*Principal amount is stated in the currency in which each bond is
denominated.
A$ - Australian Dollars
C$ - Canadian Dollars
Chf - Swiss Francs
Dem - German Deutsche Marks
Nlg - Dutch Guilders
NZ$ - New Zealand Dollars
Sa - South African Rand
Sk - Swedish Kroner
$ - U. S. Dollars
** Undistributed (distributions in excess of) net investment income includes
net realized gains (losses) on foreign currencies. Net realized gains
(losses) on foreign currencies are treated as net investment income in
accordance with provisions of the Internal Revenue Code.

NET ASSET VALUE AND OFFERING PRICE PER SHARE
GLOBAL BOND SERIES
Net asset value A Class (A) ..................................... $10.94
Sales charge (4.75% of offering price or 5.03% of the amount
invested per share) (B) ...................................... 0.55
------------
Offering price .................................................. $11.49
============
- ----------------------
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon redemption or repurchase of shares.
(B) See How to Buy Shares in the current prospectus for purchases of $100,000 or
more.

See accompanying notes
<PAGE>

DELAWARE GROUP
GLOBAL & INTERNATIONAL FUNDS, INC. -
GLOBAL EQUITY SERIES
STATEMENT OF NET ASSETS
NOVEMBER 30, 1998
- --------------------------------------------------------------------------------
NUMBER OF MARKET VALUE
SHARES (U.S. $)
------------------------

COMMON STOCK - 96.18 %
AUSTRALIA - 7.87%
Amcor .............................................. 52,300 $227,849
CSR ................................................ 116,250 279,498
Fosters Brewing Group .............................. 165,939 434,381
National Australia Bank ............................ 27,088 405,047
Orica .............................................. 22,800 125,953
----------
1,472,728
----------
BELGIUM - 2.13%
Electrabel ......................................... 1,035 399,557
----------
399,557
----------
FRANCE - 4.99%
Compagnie de Saint Gobain .......................... 1,720 254,377
Elf Aquitaine ...................................... 3,332 415,932
Societe Generale ................................... 1,679 264,868
----------
935,177
----------
GERMANY - 8.99%
Bayer .............................................. 9,700 414,557
Bayerische Vereinsbank ............................. 3,000 270,063
Continental ........................................ 13,500 337,888
RWE ................................................ 5,050 268,888
Siemens ............................................ 5,550 393,468
----------
1,684,864
----------
HONG KONG - 2.12%
Hong Kong Electric ................................. 44,000 146,335
Wharf Holdings ..................................... 159,000 251,566
----------
397,901
----------
JAPAN - 4.24%
Canon .............................................. 5,000 110,412
Chiyoda Fire and Marine ............................ 12,000 38,969
Eisai .............................................. 8,000 123,402
Hitachi ............................................ 24,000 144,380
Koito Manufacturing ................................ 10,000 41,729
Matsushita Electric ................................ 11,000 176,822
West Japan Railway ................................. 30 129,815
Yokohama Reito ..................................... 5,000 29,024
----------
794,553
----------
MALAYSIA - 0.54%
Sime Darby Berhad .................................. 145,300 101,452
----------
101,452
----------
NETHERLANDS - 4.90%
Elsevier ........................................... 31,150 409,407
Koninklijke Van Ommeren ............................ 2,515 80,333
Royal Dutch Petroleum .............................. 8,940 428,802
----------
918,542
----------
NEW ZEALAND - 2.60%
Carter Holt Harvey .................................. 114,300 108,645
Telecom Corporation of New Zealand .................. 85,600 364,118

<PAGE>

20 for international diversification

GLOBAL EQUITY SERIES
STATEMENT OF NET ASSETS (CONTINUED)
- --------------------------------------------------------------------------------

NUMBER MARKET VALUE
OF SHARES (U.S. $)
--------------------------
COMMON STOCK (CONTINUED)
NEW ZEALAND (CONTINUED)
Telecom Corporation of New Zealand IR ........ 7,126 $ 15,231
----------
487,994
----------
SINGAPORE - 1.00%
Jardine Matheson Holdings Limited ............ 55,027 187,092
----------
187,092
----------
SPAIN - 2.98%
Banco Central Hispanoamericano ............... 10,809 124,560
Iberdrola .................................... 9,100 150,982
Telefonica de Espana ......................... 6,027 283,673
----------
559,215
----------
UNITED KINGDOM - 21.36%
Associated British Food ...................... 29,500 299,324
Bass ......................................... 22,392 309,586
BG ........................................... 51,658 355,187
Blue Circle Industries ....................... 53,056 269,168
Boots ........................................ 39,700 643,856
British Airways .............................. 27,152 187,250
Cable & Wireless ............................. 29,400 375,918
*Centrica ..................................... 8,000 16,598
GKN .......................................... 23,700 262,371
Glaxo Wellcome ............................... 10,820 343,639
PowerGen ..................................... 25,900 359,369
Rio Tinto .................................... 28,050 330,196
Taylor Woodrow ............................... 94,700 251,548
----------
4,004,010
----------
UNITED STATES - 32.46%
American Home Products ....................... 7,300 388,725
Aon .......................................... 4,100 236,263
BankAmerica .................................. 5,318 346,667
Baxter International ......................... 5,000 317,813
Browning Ferris .............................. 8,100 238,950
DuPont(E.I.)deNemours ........................ 4,500 264,375
Federal National Mortgage .................... 5,000 363,750
First Union .................................. 5,000 303,750
Ford Motor ................................... 5,000 276,250
Fortune Brands ............................... 8,100 275,906
GTE .......................................... 5,400 334,800
Hewlett-Packard .............................. 5,900 370,225
Lockheed Martin .............................. 3,100 321,625
May Department Stores ........................ 5,400 325,688
McGraw-Hill .................................. 3,600 322,200
Philip Morris ................................ 7,700 430,719
Pitney Bowes ................................. 7,200 403,200
USX-Marathon Group ........................... 9,800 278,075
Williams ..................................... 9,900 285,244
----------
6,084,225
----------
Total Common Stock (cost $16,721,798) ........ 18,027,310
----------
<PAGE>

NUMBER MARKET VALUE
OF SHARES (U.S. $)
--------------------------

PREFERRED STOCK 0.12%
UNITED STATES 0.12%
Sealed Air ....................................... 475 $22,384
---------
Total Preferred Stock (cost $21,116) 22,384
---------
WARRANTS 0.00%
INDONESIA 0.00%
*Wharf Holdings .................................. 2,600 306
---------
Total Warrants (cost $0) ......................... 306
---------
PRINCIPAL
AMOUNT
----------
REPURCHASE AGREEMENTS 3.32%
With Chase Manhattan 5.25% 12/01/98
(dated 11/30/98, collateralized by
$136,000 U.S. Treasury Notes 6.25% due
10/31/01, market value $142,311and
$87,000 U.S. Treasury Notes 5.50%
due 02/28/03, market value $90,744) ............... $228,000 228,000
With J.P. Morgan Securities 5.15% 12/01/98
(dated 11/30/98, collateralized by
$46,000 U.S. Treasury Notes 5.75% due
10/31/00, market value $47,445 and
$56,000 U.S. Treasury Notes 7.50% due
11/15/01, market value $60,128 and
$68,000 U.S. Treasury Notes 6.375% due
08/15/02, market value $72,964) ................... 176,000 176,000
With PaineWebber 5.29% 12/01/98
(dated 11/30/98, collateralized by
$136,000 U.S. Treasury Bills due
02/18/99, market value $134,423
and $68,000 U.S. Treasury Notes 5.875%
due 11/15/99, market value $68,806
and $18,000 U.S. Treasury Notes 5.875%
due 02/15/00, market value $18,401) ............... 218,000 218,000
---------
TOTAL REPURCHASE AGREEMENTS (cost $622,000) .......... 622,000
---------
TOTAL MARKET VALUE OF SECURITIES 99.62%
(cost $17,364,914) ................................ $18,672,000
RECEIVABLES AND OTHER ASSETS NET OF LIABILITIES 0.38% 71,722
---------
NET ASSETS APPLICABLE TO 1,378,877 SHARES
($0.01 PAR VALUE) OUTSTANDING 100.00% ............ $18,743,722
=========
NET ASSET VALUE GLOBAL EQUITY SERIES A CLASS
($7,329,389 / 539,041 SHARES) ..................... $13.60
======
NET ASSET VALUE GLOBAL EQUITY SERIES B CLASS
($5,397,182 / 396,744 SHARES) ..................... $13.60
======
NET ASSET VALUE GLOBAL EQUITY SERIES C CLASS
($3,390,651 / 250,173 SHARES) ..................... $13.55
======
NET ASSET VALUE GLOBAL EQUITY SERIES INSTITUTIONAL CLASS
($2,626,500 / 192,919 SHARES) ..................... $13.61
======
<PAGE>

for international diversification 21

GLOBAL EQUITY SERIES
STATEMENT OF NET ASSETS (CONTINUED)
- --------------------------------------------------------------------------------

MARKET VALUE
(U.S. $)
-------------

COMPONENTS OF NET ASSETS AT NOVEMBER 30, 1998:
Common stock, $0.01 par value, 500,000,000 shares authorized
to the Fund with 50,000,000 shares allocated to
Global Equity Series A Class, 25,000,000 shares
allocated to Global Equity Series B Class, 25,000,000
shares allocated to Global Equity Series C Class,
and 50,000,000 shares allocated to Global Equity
Series Institutional Class shares ......................... $16,684,715
Distribution in excess of net investment income** ............ (56,690)
Accumulated net realized gain on investments ................. 776,047
Net unrealized appreciation of investments and foreign
currencies ................................................ 1,339,650
------------
Total net assets $18,743,722
============
- ----------------------
* Non-income producing security for the year ended November 30, 1998.
** Undistributed (distributions in excess of) net investment income includes
net realized gains (losses) on foreign currencies. Net realized gains
(losses) on foreign currencies are treated as net investment income in
accordance with provisions of the Internal Revenue Code.

IR - Installment Receipts

NET ASSET VALUE AND OFFERING PRICE PER SHARE -
GLOBAL EQUITY SERIES

Net asset value A Class (A) .................................. $13.60
Sales charge (5.75% of offering price or 6.10% of the
amount invested per share) (B) ............................ 0.83
------
Offering price ............................................... $14.43
======
- ----------------------
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon redemption or repurchase of shares.
(B) See How to Buy Shares in the current prospectus for purchases of $50,000 or
more.

See accompanying notes
<PAGE>

DELAWARE GROUP
GLOBAL & INTERNATIONAL FUNDS, INC.
EMERGING MARKETS SERIES
STATEMENT OF NET ASSETS
NOVEMBER 30, 1998
- --------------------------------------------------------------------------------
NUMBER MARKET VALUE
OF SHARES (U.S. $)
------------------------
COMMON STOCK - 98.20%
ARGENTINA - 4.81%
Central Puerto Class B ............................ 80,000 $212,031
Transportadora de Gas del Sur, Class B ............ 70,600 141,927
YPF Sociedad Anonima ADR .......................... 4,500 132,750
---------
486,708
---------
BRAZIL - 21.15%
Aracruz Celulose ADR .............................. 11,250 121,641
Brasmotor Preferred ............................... 1,606,000 147,020
Cemig ADR ......................................... 9,239 233,868
Centrais Electricas de Santa Catarina ............. 309,000 195,456
Centrais Electricas de Santa Catarina GDR ......... 1,000 63,283
Companhia Energetica de Minas Gerais .............. 3,300,000 83,496
Companhia Paranaense de Energia-Copel ADR ......... 7,878 76,811
Elevadores Atlas .................................. 18,000 209,738
Gerdau Metalurgica ................................ 11,710,000 209,542
Gerdau Metalurgica ................................ 277,018 3,689
Lojas Renner ...................................... 4,100,000 64,904
*Renner Participacoes .............................. 4,100,000 3,447
Rossi Residential GDR ............................. 24,800 36,139
Telecomunicacoes de Minas Gerias .................. 4,300,000 163,196
Telecomunicacoes de Parana ........................ 1,000,000 207,241
Uniao de Bancos Brasileiros ....................... 8,400,000 216,729
Usinas Siderurgicas de Minas Gerais ............... 24,600 66,747
Usinas Siderurgicas de Minas Gerais ADR ........... 13,370 36,293
---------
2,139,240
---------
CHILE - 4.56%
Administradora de Fondos de Pensiones Provida ADR . 12,000 181,500
Banco BHIF ADR .................................... 13,000 128,375
Empresa Nacional Electricidad ADR ................. 14,050 151,038
---------
460,913
---------
CHINA - 0.24%
*Hengan International Group ........................ 66,000 23,868
---------
23,868
---------
CROATIA - 2.02%
*Zagrebacka Banka GDR .............................. 13,740 203,695
---------
203,695
---------
CZECH REPUBLIC 1.83%
*Komercni Banka I.F. ............................... 5,300 84,814
Restitucni Investment Fund ........................ 3,400 100,612
---------
185,426
---------
EGYPT - 1.79%
Paints and Chemicals GDR .......................... 24,200 180,895
---------
180,895
---------
ESTONIA - 1.52%
*Eesti Uhispank GDR ................................ 27,895 154,120
---------
154,120
---------
<PAGE>

22 for international diversification

EMERGING MARKETS SERIES
STATEMENT OF NET ASSETS (CONTINUED)
- --------------------------------------------------------------------------------

NUMBER MARKET VALUE
OF SHARES (U.S. $)
--------------------------
COMMON STOCK (CONTINUED)
HONG KONG - 8.16%
First Tractor .................................. 610,000 $ 179,238
Guangdong Kelon Electric Holding ............... 229,000 199,645
Guangshen Railway .............................. 1,490,000 223,235
Shenzhen Expressway ............................ 934,400 223,266
---------
825,384
---------
HUNGARY - 1.94%
Gedeon Richter GDR ............................. 5,100 196,350
---------
196,350
---------
INDIA - 4.11%
*India Fund (The) ............................... 26,560 167,660
Larsen & Toubro GDR ............................ 16,200 108,540
Mahanagar Telephone Nigam Limited GDR .......... 13,220 139,802
---------
416,002
---------
INDONESIA - 0.05%
*PT United Tractors ............................. 77,000 5,176
---------
5,176
---------
ISRAEL - 2.10%
Bank Hapoalim .................................. 110,500 211,950
---------
211,950
---------
MALAYSIA - 6.54%
*Leader Universal Holdings ...................... 615,000 132,219
Petronas Dagangan .............................. 337,000 232,643
Public Finance ................................. 105,000 34,379
Resorts World Berhad ........................... 82,000 66,959
Sime Darby Berhad .............................. 280,000 195,503
---------
661,703
---------
MEXICO - 4.98%
ALFA, Class A .................................. 55,015 137,744
Cemex, Class B ................................. 36,000 106,360
*Grupo Minsa ADR ................................ 13,000 45,500
*Grupo Minsa Class C ............................ 117,000 39,605
Vitro ADR ...................................... 35,800 174,525
---------
503,734
---------
PERU - 2.23%
Banco de Credito del Peru ...................... 124,718 95,753
Creditcorp Limited ............................. 11,825 130,075
---------
225,828
---------
ROMANIA - 0.82%
*Banco Turco Romana GDR ......................... 16,500 82,913
---------
82,913
---------
RUSSIA - 2.01%
Gazprom ........................................ 5,000 52,500
Gazprom ADR Reg S .............................. 4,200 44,100
Lukoil Holding ADR ............................. 3,100 61,876
Mosenergo ADR .................................. 6,000 13,561
Mosenergo ADR Reg S ............................ 13,800 31,191
---------
203,228
---------
SLOVENIA - 0.81%
Blagovno Trgovinski Center GDR ................. 9,615 52,642
SKB Banka GDR .................................. 4,000 29,100
---------
81,742
---------
<PAGE>

NUMBER MARKET VALUE
OF SHARES (U.S. $)
--------------------------
COMMON STOCK (CONTINUED)

SOUTH AFRICA - 13.18%
Amalgamated Banks of South Africa .................. 22,800 $ 109,788
Anglo American Corporation of South Africa Limited . 8,600 275,672
Anglo American Coal Corporation .................... 3,200 184,231
Edgars Stores ...................................... 10,620 40,127
Iscor .............................................. 1,093,000 263,268
*Sanlam Limited ..................................... 97,000 102,110
*Sappi Limited ...................................... 39,600 181,637
Sasol Limited ...................................... 45,200 175,947
---------
1,332,780
---------
SOUTH KOREA - 1.64%
Pohang Iron & Steel ................................ 2,860 165,476
---------
165,476
---------
TAIWAN - 2.11%
*Yageo GDR .......................................... 29,400 213,150
---------
213,150
---------
THAILAND - 6.16%
*Hana Microelectronics Public Co. Limited ........... 78,000 194,191
*K.R. Precision Public Co. .......................... 85,200 58,921
*K.R. Precision Public Co. Foreign .................. 157,200 141,328
Thai Reinsurance Public Co. Limited ................ 86,000 228,382
---------
622,822
---------
TURKEY - 3.44%
*Efes Sinai Yatirim 144A ADR ........................ 69,083 67,356
*Efes Sinai Yatirim Holdings ADR .................... 6,355,300 57,500
Koc Holding ........................................ 1,454,100 136,344
Netas-Northern Eleckrik Telekomunikayson ........... 4,524,000 86,327
---------
347,527
---------
Total Common Stock (cost $16,922,023) .............. 9,930,630
---------
WARRANTS - 0.00%
HONG KONG - 0.00%
*Guangdong Investment 7/99 .......................... 14,800 107
---------
Total Warrants (cost $0) ........................... 107
---------
PRINCIPAL
AMOUNT
---------
REPURCHASE AGREEMENTS - 1.80%
With Chase Manhattan 5.25% 12/01/98
(dated 11/30/98, collateralized by $40,000
U.S. Treasury Notes 6.25% due 10/31/01,
market value $41,641 and $25,000 U.S. ...........
Treasury Notes 5.50% due 02/28/03,
market value $26,552) ........................... $ 67,000 67,000
With J.P. Morgan Securities 5.15% 12/01/98
(dated 11/30/98, collateralized by $14,000
U.S. Treasury Notes 5.75% due 10/31/00,
market value $13,882 and $16,000 U.S. ...........
Treasury Notes 7.50% due 11/15/01,
market value $17,594 and $20,000 U.S. ...........
Treasury Notes 6.375% due 08/15/02,
market value $21,349) ........................... 52,000 52,000

<PAGE>

for international diversification 23

EMERGING MARKETS SERIES
STATEMENT OF NET ASSETS (CONTINUED)
- --------------------------------------------------------------------------------
PRINCIPAL MARKET VALUE
AMOUNT (U.S. $)
------------------------------

REPURCHASE AGREEMENTS (CONTINUED)
With PaineWebber 5.29% 12/01/98
(dated 11/30/98, collateralized by $40,000
U.S. Treasury Bills due 02/18/99, market
value $39,333 and $20,000 U.S. Treasury
Notes 5.875% due 11/15/99, market value
$20,133 and $5,000 U.S. Treasury Notes
5.875% due 02/15/00, market value
$5,384) .............................................. $63,000 $ 63,000
-----------
Total Repurchase Agreements (cost $182,000) ............. 182,000
-----------
TOTAL MARKET VALUE OF SECURITIES 100.00%
(cost $17,104,023) .......................................... $10,112,737
RECEIVABLES AND OTHER ASSETS NET OF LIABILITIES 0.00% ......... 356
-----------
NET ASSETS APPLICABLE TO 1,556,204 SHARES ($0.01 PAR
VALUE) OUTSTANDING 100.00% ................................. $10,113,093
===========
NET ASSET VALUE EMERGING MARKETS SERIES A CLASS
($5,584,072 / 855,517 SHARES) ............................... $6.53
=====
NET ASSET VALUE EMERGING MARKETS SERIES B CLASS
($2,527,833 / 392,677 SHARES) ............................... $6.44
=====
NET ASSET VALUE EMERGING MARKETS SERIES C CLASS
($884,022 / 137,443 SHARES) ................................. $6.43
=====
NET ASSET VALUE EMERGING MARKETS SERIES INSTITUTIONAL CLASS
($1,117,166 / 170,567 SHARES) ............................... $6.55
=====
<PAGE>

COMPONENTS OF NET ASSETS AT NOVEMBER 30, 1998:
Common stock, $0.01 par value, 500,000,000 shares
authorized to the Fund with 50,000,000 shares
allocated to Emerging Markets Series A Class, 25,000,000
shares allocated to Emerging Markets Series B Class, 25,000,000
shares allocated to Emerging Markets Series C Class, and
50,000,000 shares allocated to Emerging Markets Series
Institutional Class .......................................... $18,561,132
Undistributed net investment income** ........................... 44,206
Accumulated net realized loss on investments .................... (1,500,680)
Net unrealized depreciation of investments and foreign currencies (6,991,565)
-----------
Total net assets ................................................ $10,113,093
===========
- ----------------------
*Non-income producing security for the year ended November 30, 1998.
**Undistributed net investment income includes net realized gains (losses) on
foreign currencies. Net realized gains (losses) on foreign currencies are
treated as net investment income in accordance with provisions of the
Internal Revenue Code.

ADR - American Depository Receipt
GDR - Global Depository Receipt

NET ASSET VALUE AND OFFERING PRICE PER SHARE
EMERGING MARKETS SERIES

Net asset value A Class (A) ..................................... $6.53
Sales charge (5.75% of offering price or 6.13% of the
amount invested per share) (B) ............................... 0.40
-----

Offering price .................................................. $6.93
=====
- ----------------------
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon redemption or repurchase of shares.
(B) See How to Buy Shares in the current prospectus for purchases of $50,000 or
more.

See accompanying notes
<PAGE>

24 for international diversification

DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS, INC.
STATEMENTS OF OPERATIONS
YEAR ENDED NOVEMBER 30, 1998
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY GLOBAL BOND GLOBAL EQUITY EMERGING MARKETS
SERIES SERIES SERIES SERIES
INVESTMENT INCOME:
<S> <C> <C> <C> <C>
Interest ............................................................ $ 1,107,694 $1,262,436 $ 349,165 $ 41,681
Dividends ........................................................... 9,325,470 -- 328,023 478,333
Foreign tax withheld ................................................ (671,711) (2,826) (13,839) (33,533)
---------- ---------- ---------- ------------
9,761,453 1,259,610 663,349 486,481
---------- ---------- ---------- ------------
EXPENSES:
Management fees ..................................................... 2,084,553 137,275 132,982 172,141
Accounting and administration ....................................... 109,711 7,273 7,042 7,195
Reports and statements to shareholders .............................. 64,400 2,821 9,747 16,400
Registration fees ................................................... 57,176 29,565 19,400 96,324
Professional fees ................................................... 52,000 800 3,864 9,770
Taxes (other than taxes on income) .................................. 18,957 225 818 2,358
Dividend disbursing and transfer agent fees and expenses............. 1,340,329 33,892 103,821 126,049
Distribution expense ................................................ 871,953 31,589 105,841 66,472
Custodian fees ...................................................... 92,459 10,714 5,769 48,310
Directors fees ...................................................... 4,339 1,094 1,080 909
Amortization of organization expenses ............................... -- 3,825 3,641 3,651
Other ............................................................... 45,816 10,470 9,890 13,125
---------- ---------- ---------- ------------
4,741,693 269,543 403,895 562,704
Less expenses absorbed or waived by Delaware International
Advisers Ltd....................................................... -- (63,250) (77,754) (265,689)
---------- ---------- ---------- ------------
Total expenses ...................................................... 4,741,693 206,293 326,141 297,015
---------- ---------- ---------- ------------

NET INVESTMENT INCOME ............................................... 5,019,760 1,053,317 337,208 189,466
---------- ---------- ---------- ------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND
FOREIGN CURRENCIES:
Net realized gain (loss) on:
Investments ...................................................... (2,837,854) 206,294 1,181,578 (1,368,689)
Foreign currencies ............................................... (358,307) (219,649) (222,349) (115,914)
---------- ---------- ---------- ------------
Net realized gain (loss) ......................................... (3,196,161) (13,355) 959,229 (1,484,603)
Net change in unrealized appreciation/depreciation of investments
and foreign currencies............................................ 18,869,098 (4,946) 58,825 (4,195,214)
---------- ---------- ---------- ------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
AND FOREIGN CURRENCIES............................................ 15,672,937 (18,301) 1,018,054 (5,679,817)
---------- ---------- ---------- ------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS ..... $20,692,697 $1,035,016 $1,355,262 ($ 5,490,351)
========== ========== ========== ============
</TABLE>
See accompanying notes
<PAGE>

for international diversification 25

DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS, INC.
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY GLOBAL BOND
SERIES SERIES
----------------------------- -----------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
11/30/98 11/30/97 11/30/98 11/30/97
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
Net investment income ............................. $ 5,019,760 $ 2,692,917 $ 1,053,317 $ 881,753
Net realized gain (loss) on investments
and foreign currencies ......................... (3,196,161) 6,169,700 (13,355) 119,653
Net change in unrealized appreciation/
depreciation of investments and foreign
currencies ..................................... 18,869,098 (7,483,373) (4,946) (648,055)
------------ ------------ ----------- ------------
Net increase (decrease) in net assets
resulting from operations ...................... 20,692,697 1,379,244 1,035,016 353,351
------------ ------------ ----------- ------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income:
A Class ........................................ (3,037,638) (2,797,661) (166,398) (305,700)
B Class ........................................ (567,801) (314,247) (34,237) (63,377)
C Class ........................................ (200,379) (67,804) (20,219) (31,300)
Institutional Class ............................ (2,491,733) (1,209,385) (528,593) (651,174)

NET REALIZED GAIN ON INVESTMENTS:
A Class ........................................ (1,182,260) (123,938) (12,745) (12,933)
B Class ........................................ (345,134) (15,415) (3,044) (2,428)
C Class ........................................ (121,799) (2,682) (1,965) (424)
Institutional Class ............................ (754,255) (46,296) (31,461) (23,842)
------------ ------------ ----------- ------------
(8,700,999) (4,577,428) (798,662) (1,091,178)
------------ ------------ ----------- ------------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold:
A Class ........................................ 248,532,751 95,608,942 1,209,209 2,749,127
B Class ........................................ 60,750,047 50,802,495 369,004 716,211
C Class ........................................ 111,824,042 19,377,282 46,266 601,901
Institutional Class ............................ 134,073,252 54,385,504 4,205,056 5,493,756
Net asset value of shares issued upon
reinvestment of distributions from net
investment income and net realized gain
on investments:
A Class ........................................ 3,884,411 2,781,683 125,332 261,143
B Class ........................................ 845,306 301,251 30,879 48,687
C Class ........................................ 284,894 67,923 21,384 30,822
Institutional Class ............................ 2,947,818 1,248,194 558,582 674,758
------------ ------------ ----------- ------------
563,142,521 224,573,274 6,565,712 10,576,405
------------ ------------ ----------- ------------
Cost of shares repurchased:
A Class ........................................ (249,450,329) (75,048,166) (1,276,054) (1,684,418)
B Class ........................................ (57,621,538) (29,347,424) (306,186) (341,785)
C Class ........................................ (111,127,873) (9,214,761) (239,025) (30,665)
Institutional Class ............................ (44,978,467) (16,596,084) (3,262,721) (1,151,567)
------------ ------------ ----------- ------------
(463,178,207) (130,206,435) (5,083,986) (3,208,435)
------------ ------------ ----------- ------------
Increase (decrease) in net assets derived from
capital share transactions ..................... 99,964,314 94,366,839 1,481,726 7,367,970
------------ ------------ ----------- ------------

NET INCREASE (DECREASE) IN NET ASSETS ............. 111,956,012 91,168,655 1,718,080 6,630,143

NET ASSETS:

Beginning of year ................................. 227,326,719 136,158,064 17,629,426 10,999,283
------------ ------------ ----------- ------------
End of year ....................................... $ 339,282,731 $ 227,326,719 $ 19,347,506 $ 17,629,426
============ ============ =========== ============
</TABLE>

<PAGE>
[restubbed table]
<TABLE>
<CAPTION>
GLOBAL EQUITY EMERGING MARKETS
SERIES SERIES
---------------------------- ---------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
11/30/98 11/30/97 11/30/98 11/30/97
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
Net investment income ............................. $ 337,208 $ 510,179 $ 189,466 $ 62,601
Net realized gain (loss) on investments
and foreign currencies ......................... 959,229 1,350,450 (1,484,603) 757,185
Net change in unrealized appreciation/
depreciation of investments and foreign
currencies ..................................... 58,825 (605,292) (4,195,214) (2,722,301)
------------ ------------ ----------- -----------
Net increase (decrease) in net assets
resulting from operations ...................... 1,355,262 1,255,337 (5,490,351) (1,902,515)
------------ ------------ ----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income:
A Class ........................................ (171,922) (336,743) (18,319) (2,696)
B Class ........................................ (78,621) (127,562) -- --
C Class ........................................ (53,181) (52,779) -- --
Institutional Class ............................ (70,840) (87,203) (9,828) (9,242)

NET REALIZED GAIN ON INVESTMENTS:
A Class ........................................ (610,032) (45,735) (554,164) (20,222)
B Class ........................................ (397,951) (17,933) (207,819) (2,270)
C Class ........................................ (272,115) (4,527) (80,276) (1,540)
Institutional Class ............................ (198,609) (8,230) (108,106) (27,727)
------------ ------------ ----------- -----------
(1,853,271) (680,712) (978,512) (63,697)
------------ ------------ ----------- -----------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold:
A Class ........................................ 2,361,979 3,460,095 3,500,308 16,953,861
B Class ........................................ 1,381,650 2,221,214 1,064,411 5,637,884
C Class ........................................ 734,792 1,859,189 469,587 1,675,859
Institutional Class ............................ 534,315 213,172 1,246,820 2,304,964
Net asset value of shares issued upon
reinvestment of distributions from net
investment income and net realized gain
on investments:
A Class ........................................ 751,633 375,195 525,839 22,478
B Class ........................................ 443,501 140,100 197,988 2,081
C Class ........................................ 291,513 53,622 76,653 1,540
Institutional Class ............................ 269,449 95,433 112,829 36,969
------------ ------------ ----------- -----------
6,768,832 8,418,020 7,194,435 26,635,636
------------ ------------ ----------- -----------
Cost of shares repurchased:
A Class ........................................ (2,518,715) (8,950,771) (4,545,984) (8,593,077)
B Class ........................................ (744,541) (2,858,059) (779,647) (1,724,911)
C Class ........................................ (628,811) (124,369) (670,501) (128,601)
Institutional Class ............................ (423,236) (334,720) (1,200,434) (4,355,115)
------------ ------------ ----------- -----------
(4,315,303) (12,267,919) (7,196,566) (14,801,704)
------------ ------------ ----------- -----------
Increase (decrease) in net assets derived from
capital share transactions ..................... 2,453,529 (3,849,899) (2,131) 11,833,932
------------ ------------ ----------- -----------

NET INCREASE (DECREASE) IN NET ASSETS ............. 1,955,520 (3,275,274) (6,470,994) 9,867,720

NET ASSETS:

Beginning of year ................................. 16,788,202 20,063,476 16,584,087 6,716,367
------------ ------------ ----------- -----------
End of year ....................................... $ 18,743,722 $ 16,788,202 $10,113,093 $ 16,584,087
============ ============ =========== ===========
</TABLE>
See accompanying notes
<PAGE>

26 for international diversification

DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS, INC.
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------

Selected data for each share of the Series outstanding throughout each period
were as follows:
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY SERIES A CLASS
----------------------------------------------------------
YEAR ENDED

11/30/98 11/30/97 11/30/96 11/30/95 11/30/94
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........................ $14.650 $14.640 $12.190 $11.920 $11.250

Income from investment operations:

Net investment income(1) ................................. 0.273 0.220 0.490 0.297 0.140
Net realized and unrealized gain on investments and
foreign currencies ..................................... 0.957 0.245 2.385 0.628 0.895
------- ------- ------- ------- ------
Total from investment operations ......................... 1.230 0.465 2.875 0.925 1.035
------- ------- ------- ------- ------
Less dividends and distributions:

Dividends from net investment income ..................... (0.395) (0.435) (0.280) (0.185) (0.225)
Distributions from net realized gain on investments ...... (0.155) (0.020) (0.145) (0.470) (0.140)
------- ------- ------- ------- ------
Total dividends and distributions ........................ (0.550) (0.455) (0.425) (0.655) (0.365)
------- ------- ------- ------- ------
Net asset value, end of period .............................. $15.330 $14.650 $14.640 $12.190 $11.920
======= ======= ======= ======= ======

Total return(2) ............................................. 8.75% 3.27% 24.22% 8.17% 9.23%

Ratios and supplemental data:

Net assets, end of period (000 omitted) ..................$122,609 $112,425 $89,177 $62,251 $53,736
Ratio of expenses to average net assets .................. 1.70% 1.70% 1.85% 2.07% 1.56%
Ratio of expenses to average net assets prior to
expense limitation ..................................... 1.70% 1.71% 1.95% 2.07% 1.82%
Ratio of net investment income to average net assets ..... 1.80% 1.46% 3.70% 2.57% 1.22%
Ratio of net investment income to average net assets
prior to expense limitation ............................ 1.80% 1.45% 3.60% 2.57% 0.96%
Portfolio turnover ....................................... 5% 8% 9% 21% 27%
</TABLE>

- ----------------------
(1) Per share information for the years ended November 30, 1996, 1997, and 1998
was based on the average shares outstanding method.
(2) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.

See accompanying notes
<PAGE>

for international diversification 27

FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Series outstanding throughout each period
were as follows:
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY SERIES B CLASS
----------------------------------------------------------
9/6/94(2)
YEAR ENDED TO
11/30/98 11/30/97 11/30/96 11/30/95 11/30/94
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period .............. $14.560 $14.560 $12.130 $11.900 $12.860

Income (loss) from investment operations:

Net investment income(1) ....................... 0.168 0.114 0.398 0.278 0.036
Net realized and unrealized gain (loss) on
investments and foreign currencies ............. 0.962 0.246 2.377 0.567 (0.966)
-------- -------- ------- ------- -------
Total from investment operations ............... 1.130 0.360 2.775 0.845 (0.930)
-------- -------- ------- ------- -------
Less dividends and distributions:

Dividends from net investment income ........... (0.255) (0.340) (0.200) (0.145) (0.030)
Distributions from net realized gain
on investments ................................. (0.155) (0.020) (0.145) (0.470) none
-------- -------- ------- ------- -------
Total dividends and distributions .............. (0.410) (0.360) (0.345) (0.615) (0.030)
-------- -------- ------- ------- -------
Net asset value, end of period .................... $15.280 $14.560 $14.560 $12.130 $11.900
======== ======== ======= ======= =======

Total return(4) ................................... 8.03% 2.54% 23.38% 7.46% (7.24%)

Ratios and supplemental data:
Net assets, end of period (000 omitted) ........ $37,775 $31,914 $10,878 $3,471 $624
Ratio of expenses to average net assets ........ 2.40% 2.40% 2.55% 2.77% 2.26%
Ratio of expenses to average net assets prior
to expense limitation ........................ 2.40% 2.41% 2.65% 2.77% 2.52%
Ratio of net investment income to average
net assets ................................... 1.10% 0.76% 3.00% 1.87% 0.52%
Ratio of net investment income to average net
assets prior to expense limitation ........... 1.10% 0.75% 2.90% 1.87% 0.26%
Portfolio turnover ............................. 5% 8% 9% 21% 27%
</TABLE>

<PAGE>
[restubbed table]
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY SERIES C CLASS
-------------------------------------------
11/29/95(3)
YEAR ENDED TO
11/30/98 11/30/97 11/30/96 11/30/95
<S> <C> <C> <C> <C>
Net asset value, beginning of period .............. $14.540 $14.540 $12.190 $12.240

Income (loss) from investment operations:

Net investment income(1) ....................... 0.167 0.114 0.400 none
Net realized and unrealized gain (loss) on
investments and foreign currencies ............. 0.963 0.246 2.375 (0.050)
------- ------- ------- -------
Total from investment operations ............... 1.130 0.360 2.775 (0.050)
------- ------- ------- -------
Less dividends and distributions:

Dividends from net investment income ........... (0.255) (0.340) (0.280) none
Distributions from net realized gain
on investments ................................. (0.155) (0.020) (0.145) none
------- ------- ------- -------
Total dividends and distributions .............. (0.410) (0.360) (0.425) none
------- ------- ------- -------
Net asset value, end of period .................... $15.260 $14.540 $14.540 $12.190
======= ======= ======= =======

Total return(4) ................................... 8.04% 2.54% 23.39% (5)

Ratios and supplemental data:
Net assets, end of period (000 omitted) ........ $14,076 $11,811 $1,909 $5
Ratio of expenses to average net assets ........ 2.40% 2.40% 2.55% (5)
Ratio of expenses to average net assets prior
to expense limitation ........................ 2.40% 2.41% 2.65% (5)
Ratio of net investment income to average
net assets ................................... 1.10% 0.76% 3.00% (5)
Ratio of net investment income to average net
assets prior to expense limitation ........... 1.10% 0.75% 2.90% (5)
Portfolio turnover ............................. 5% 8% 9% (5)
</TABLE>

- ----------------------
(1) Per share information for the years ended November 30, 1996, 1997, and 1998
was based on the average shares outstanding method.
(2) Date of commencement of trading; ratios have been annualized and total
return has not been annualized.
(3) Date of commencement of trading.
(4) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(5) The ratios of expenses and net investment income to average net assets,
portfolio turnover and total return have been omitted as management believes
that such ratios and total return for this relatively short period are not
meaningful.

See accompanying notes
<PAGE>

28 for international diversification

FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Series outstanding throughout each period
were as follows:
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY SERIES INSTITUTIONAL CLASS
-----------------------------------------------------------
YEAR ENDED
11/30/98 11/30/97 11/30/96 11/30/95 11/30/94
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ...................... $14.720 $14.710 $12.240 $11.970 $11.290

Income from investment operations:
Net investment income(1) ............................... 0.318 0.267 0.530 0.323 0.166
Net realized and unrealized gain on investments and
foreign currencies .................................... 0.962 0.238 2.405 0.637 0.899
------- ------- ------- ------- -------
Total from investment operations........................ 1.280 0.505 2.935 0.960 1.065
------- ------- ------- ------- -------

Less dividends and distributions:
Dividends from net investment income ................... (0.475) (0.475) (0.320) (0.220) (0.245)
Distributions from net realized gain on investments .... (0.155) (0.020) (0.145) (0.470) (0.140)
------- ------- ------- ------- -------
Total dividends and distributions ...................... (0.630) (0.495) (0.465) (0.690) (0.385)
------- ------- ------- ------- -------
Net asset value, end of period ............................ $15.370 $14.720 $14.710 $12.240 $11.970
======= ======= ======= ======= =======

Total return .............................................. 9.10% 3.55% 24.68% 8.46% 9.47%

Ratios and supplemental data:
Net assets, end of period (000 omitted) ................ $164,823 $71,177 $34,194 $11,660 $7,613
Ratio of expenses to average net assets ................ 1.40% 1.40% 1.55% 1.77% 1.26%
Ratio of expenses to average net assets prior to
expense limitation .................................... 1.40% 1.41% 1.65% 1.77% 1.52%
Ratio of net investment income to average net assets ... 2.10% 1.76% 4.00% 2.87% 1.52%
Ratio of net investment income to average net assets
prior to expense limitation ........................... 2.10% 1.75% 3.90% 2.87% 1.26%
Portfolio turnover ..................................... 5% 8% 9% 21% 27%
</TABLE>

- ----------------------
(1) Per share information for the years ended November 30, 1996, 1997, and 1998
was based on the average shares outstanding method.

See accompanying notes
<PAGE>

for international diversification 29

FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Series outstanding throughout each period
were as follows:
<TABLE>
<CAPTION>
GLOBAL BOND SERIES A CLASS
------------------------------------------------
12/27/94(2)
YEAR ENDED TO
11/30/98 11/30/97 11/30/96 11/30/95
<S> <C> <C> <C> <C>
Net asset value, beginning of period ................................. $10.790 $11.480 $11.230 $10.000

Income (loss) from investment operations:
Net investment income(1) .......................................... 0.595 0.625 0.755 0.659
Net realized and unrealized gain (loss) on investments and
foreign currencies ............................................. (0.015) (0.505) 0.730 1.171
-------- -------- ------- -------
Total from investment operations .................................. 0.580 0.120 1.485 1.830
-------- -------- ------- -------
Less dividends and distributions:
Dividends from net investment income .............................. (0.400) (0.770) (0.875) (0.600)
Distributions from net realized gain on investments ............... (0.030) (0.040) (0.360) none
-------- -------- ------- -------
Total dividends and distributions ................................. (0.430) (0.810) (1.235) (0.600)
-------- -------- ------- -------
Net asset value, end of period ....................................... $10.940 $10.790 $11.480 $11.230
======== ======== ======= =======

Total return(3) ...................................................... 5.47% 1.24% 14.35% 18.79%

Ratios and supplemental data:
Net assets, end of period (000 omitted) ........................... $4,684 $4,567 $3,467 $889
Ratio of expenses to average net assets ........................... 1.25% 1.25% 1.25% 1.25%
Ratio of expenses to average net assets prior to expense
limitation ..................................................... 1.59% 2.04% 5.00% 12.34%
Ratio of net investment income to average net assets .............. 5.58% 5.76% 6.82% 7.70%
Ratio of net investment income (loss) to average net assets
prior to expense limitation .................................... 5.24% 4.97% 3.07% (3.39%)
Portfolio turnover ................................................ 93% 76% 42% 98%
</TABLE>

<PAGE>
[restubbed table]

<TABLE>
<CAPTION>
GLOBAL BOND SERIES B CLASS
----------------------------------------------
12/27/94(2)
YEAR ENDED TO
11/30/98 11/30/97 11/30/96 11/30/95
<S> <C> <C> <C> <C>
Net asset value, beginning of period .................................. $10.790 $11.490 $11.230 $10.000

Income (loss) from investment operations:
Net investment income(1) ........................................... 0.520 0.550 0.679 0.565
Net realized and unrealized gain (loss) on investments and
foreign currencies .............................................. (0.020) (0.511) 0.735 1.205
-------- -------- ------- -------
Total from investment operations ................................... 0.500 0.039 1.414 1.770
-------- -------- ------- -------
Less dividends and distributions:
Dividends from net investment income ............................... (0.330) (0.699) (0.794) (0.540)
Distributions from net realized gain on investments ................ (0.030) (0.040) (0.360) none
-------- -------- ------- -------
Total dividends and distributions .................................. (0.360) (0.739) (1.154) (0.540)
-------- -------- ------- -------
Net asset value, end of period ........................................ $10.930 $10.790 $11.490 $11.230
======== ======== ======= =======

Total return(3) ....................................................... 4.59% 0.48% 13.51% 18.23%

Ratios and supplemental data:
Net assets, end of period (000 omitted) ............................ $1,188 $1,081 $707 $115
Ratio of expenses to average net assets ............................ 1.95% 1.95% 1.95% 1.95%
Ratio of expenses to average net assets prior to expense
limitation ...................................................... 2.29% 2.74% 5.70% 13.04%
Ratio of net investment income to average net assets ............... 4.88% 5.06% 6.12% 7.00%
Ratio of net investment income (loss) to average net assets
prior to expense limitation ..................................... 4.54% 4.27% 2.37% (4.09%)
Portfolio turnover ................................................. 93% 76% 42% 98%
</TABLE>

See accompanying notes
<PAGE>

30 for international diversification

FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Series outstanding throughout each period
were as follows:
<TABLE>
<CAPTION>
GLOBAL BOND SERIES C CLASS
----------------------------------------------
11/29/95(2)
YEAR ENDED TO
11/30/98 11/30/97 11/30/96 11/30/95
<S> <C> <C> <C> <C>
Net asset value, beginning of period ........................................ $10.740 $11.440 $11.240 $11.330

Income (loss) from investment operations:
Net investment income(1) ................................................. 0.521 0.551 0.680 none
Net realized and unrealized gain (loss) on investments and
foreign currencies .................................................... (0.021) (0.512) 0.719 (0.036)
------- ------- ----- -------
Total from investment operations ......................................... 0.500 0.039 1.399 (0.036)
------- ------- ----- -------

Less dividends and distributions:
Dividends from net investment income ..................................... (0.330) (0.699) (0.839) (0.054)
Distributions from net realized gain on investments ...................... (0.030) (0.040) (0.360) none
------- ------- ------- -------
Total dividends and distributions ........................................ (0.360) (0.739) (1.199) (0.054)
------- ------- ------- -------
Net asset value, end of period .............................................. $10.880 $10.740 $11.440 $11.240
======= ======== ======== ========

Total return(4) ............................................................. 4.71% 0.49% 13.51% (5)

Ratios and supplemental data:
Net assets, end of period (000 omitted) .................................. $ 539 $703 $118 $ 5
Ratio of expenses to average net assets .................................. 1.95% 1.95% 1.95% (5)
Ratio of expenses to average net assets prior to expense
limitation ............................................................ 2.29% 2.74% 5.70% (5)
Ratio of net investment income to average net assets ..................... 4.88% 5.06% 6.12% (5)
Ratio of net investment income (loss) to average net assets
prior to expense limitation ........................................... 4.54% 4.27% 2.37% (5)
Portfolio turnover ....................................................... 93% 76% 42% (5)
</TABLE>

<PAGE>
[restubbed table]

<TABLE>
<CAPTION>
GLOBAL BOND SERIES INSTITUTIONAL CLASS
----------------------------------------------
12/27/94(3)
YEAR ENDED TO
11/30/98 11/30/97 11/30/96 11/30/95
<S> <C> <C> <C> <C>
Net asset value, beginning of period ........................................ $10.810 $11.520 $11.270 $10.000

Income (loss) from investment operations:
Net investment income(1) ................................................. 0.627 0.658 0.788 0.782
Net realized and unrealized gain (loss) on investments and
foreign currencies .................................................... (0.017) (0.515) 0.732 1.088
------ ------ ------ ------
Total from investment operations ......................................... 0.610 0.143 1.520 1.870
------ ------ ------ ------
Less dividends and distributions:
Dividends from net investment income ..................................... (0.460) (0.813) (0.910) (0.600)
Distributions from net realized gain on investments ...................... (0.030) (0.040) (0.360) none
------ ------ ------ ------
Total dividends and distributions ........................................ (0.490) (0.853) (1.270) (0.600)
------ ------ ------ ------
Net asset value, end of period .............................................. $10.930 $10.810 $11.520 $11.270
====== ====== ====== ======
Total return(4) ............................................................. 5.88% 1.45% 14.68% 19.21%

Ratios and supplemental data:
Net assets, end of period (000 omitted) .................................. $12,937 $11,278 $6,707 $897
Ratio of expenses to average net assets .................................. 0.95% 0.95% 0.95% 0.95%
Ratio of expenses to average net assets prior to expense
limitation ............................................................ 1.29% 1.74% 4.70% 12.04%
Ratio of net investment income to average net assets ..................... 5.88% 6.06% 7.12% 8.00%
Ratio of net investment income (loss) to average net assets
prior to expense limitation ........................................... 5.54% 5.27% 3.37% (3.09%)
Portfolio turnover ....................................................... 93% 76% 42% 98%
</TABLE>

- ----------------------
(1) Per share information for the years ended November 30, 1996, 1997, and 1998
was based on the average shares outstanding method.
(2) Date of commencement of trading.
(3) Date of commencement of trading; ratios have been annualized and total
return has not been annualized.
(4) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(5) The ratios of expenses and net investment income to average net assets,
portfolio turnover and total return have been omitted as management believes
that such ratios and total return for this relatively short period are not
meaningful.

See accompanying notes
<PAGE>

for international diversification 31

FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Series outstanding throughout each period
were as follows:
<TABLE>
<CAPTION>
GLOBAL EQUITY SERIES A CLASS
-----------------------------------------------
12/27/94(2)
YEAR ENDED TO
11/30/98(4) 11/30/97 11/30/96 11/30/95
<S> <C> <C> <C> <C>
Net asset value, beginning of period .................................... $14.050 $13.310 $11.900 $10.000

Income from investment operations:
Net investment income(1) ............................................. 0.289 0.437 0.493 0.301
Net realized and unrealized gain on investments and
foreign currencies .................................................. 0.826 0.843 1.572 1.839
------ ------ ------ ------
Total from investment operations ..................................... 1.115 1.280 2.065 2.140
------ ------ ------ ------
Less dividends and distributions:
Dividends from net investment income ................................. (0.335) (0.490) (0.385) (0.240)
Distributions from net realized gain on investments .................. (1.230) (0.050) (0.270) none
------ ------ ------ ------
Total dividends and distributions .................................... (1.565) (0.540) (0.655) (0.240)
------ ------ ------ ------
Net asset value, end of period .......................................... $13.600 $14.050 $13.310 $11.900
====== ====== ====== ======
Total return(3) ......................................................... 8.83% 9.91% 18.17% 21.48%

Ratios and supplemental data:

Net assets, end of period (000 omitted) .............................. $7,329 $6,939 $11,878 $3,122
Ratio of expenses to average net assets .............................. 1.55% 1.25% 1.25% 1.25%
Ratio of expenses to average net assets prior to expense
limitation .......................................................... 1.99% 2.16% 2.72% 7.55%
Ratio of net investment income to average net assets ................. 2.17% 3.24% 4.13% 4.75%
Ratio of net investment income (loss) to average net assets
prior to expense limitation ......................................... 1.73% 2.33% 2.66% (1.55%)
Portfolio turnover ................................................... 90% 74% 34% 57%
</TABLE>

<PAGE>
[restubbed table]
<TABLE>
<CAPTION>
GLOBAL EQUITY SERIES B CLASS
-----------------------------------------------
12/27/94(2)
YEAR ENDED TO
11/30/98(4) 11/30/97 11/30/96 11/30/95
<S> <C> <C> <C> <C>
Net asset value, beginning of period .................................. $14.040 $13.300 $11.880 $10.000

Income from investment operations:
Net investment income(1) ........................................... 0.197 0.342 0.379 0.212
Net realized and unrealized gain on investments and
foreign currencies ................................................ 0.813 0.848 1.606 1.848
------ ------ ------ ------
Total from investment operations ................................... 1.010 1.190 1.985 2.060
------ ------ ------ ------
Less dividends and distributions:

Dividends from net investment income ............................... (0.220) (0.400) (0.295) (0.180)
Distributions from net realized gain on investments ................ (1.230) (0.050) (0.270) none
------ ------ ------ ------
Total dividends and distributions .................................. (1.450) (0.450) (0.565) (0.180)
------ ------ ------ ------
Net asset value, end of period ........................................ $13.600 $14.040 $13.300 $11.880
====== ====== ====== ======
Total return(3) ....................................................... 7.97% 9.18% 17.32% 20.73%

Ratios and supplemental data:
Net assets, end of period (000 omitted) ............................ $5,397 $4,445 $4,796 $613
Ratio of expenses to average net assets ............................ 2.25% 1.95% 1.95% 1.95%
Ratio of expenses to average net assets prior to expense
limitation ........................................................ 2.69% 2.86% 3.42% 8.25%
Ratio of net investment income to average net assets ............... 1.47% 2.54% 3.43% 4.05%
Ratio of net investment income (loss) to average net assets
prior to expense limitation ....................................... 1.03% 1.63% 1.96% (2.25%)
Portfolio turnover ................................................. 90% 74% 34% 57%
</TABLE>

- ----------------------
(1) Per share information for the years ended November 30, 1997 and 1998 was
based on the average shares outstanding method.
(2) Date of commencement of trading; ratios and total return have been
annualized.
(3) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(4) Effective July 21, 1998, the Series was renamed the Global Equity Series
(formerly the Global Assets Series) and its investment focus was changed,
eliminating the Series bond component in favor of stocks.

See accompanying notes
<PAGE>

32 for international diversification

FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Series outstanding throughout each period
were as follows:
<TABLE>
<CAPTION>
GLOBAL EQUITY SERIES C CLASS
-----------------------------------------------
11/29/95(2)
YEAR ENDED TO
11/30/98(6) 11/30/97 11/30/96 11/30/95
<S> <C> <C> <C> <C>
Net asset value, beginning of period .................................... $13.990 $13.250 $11.890 $11.940

Income (loss) from investment operations:
Net investment income(1) ............................................. 0.197 0.341 0.446 none
Net realized and unrealized gain (loss) on investments and
foreign currencies .................................................. 0.813 0.849 1.534 (0.050)
------ ------ ------ ------
Total from investment operations ..................................... 1.010 1.190 1.980 (0.050)
------ ------ ------ ------
Less dividends and distributions:
Dividends from net investment income ................................. (0.220) (0.400) (0.350) none
Distributions from net realized gain on investments .................. (1.230) (0.050) (0.270) none
------ ------ ------ ------
Total dividends and distributions .................................... (1.450) (0.450) (0.620) none
------ ------ ------ ------
Net asset value, end of period .......................................... $13.550 $13.990 $13.250 $11.890
====== ====== ====== ======

Total return(4) ......................................................... 8.00% 9.21% 17.33% (5)

Ratios and supplemental data:
Net assets, end of period (000 omitted) .............................. $3,391 $3,094 $1,185 $5
Ratio of expenses to average net assets .............................. 2.25% 1.95% 1.95% (5)
Ratio of expenses to average net assets prior to expense
limitation .......................................................... 2.69% 2.86% 3.42% (5)
Ratio of net investment income to average net assets ................. 1.47% 2.54% 3.43% (5)
Ratio of net investment income (loss) to average net assets
prior to expense limitation ......................................... 1.03% 1.63% 1.96% (5)
Portfolio turnover ................................................... 90% 74% 34% (5)
</TABLE>

<PAGE>
[restubbed table]
<TABLE>
<CAPTION>
GLOBAL EQUITY SERIES INSTITUTIONAL CLASS
-----------------------------------------------
12/27/94(3)
YEAR ENDED TO
11/30/98(6) 11/30/97 11/30/96 11/30/95
<S> <C> <C> <C> <C>
Net asset value, beginning of period ..................................... $14.100 $13.340 $11.930 $10.000

Income (loss) from investment operations:
Net investment income(1) .............................................. 0.329 0.478 0.567 0.473
Net realized and unrealized gain (loss) on investments and
foreign currencies ................................................... 0.816 0.857 1.533 1.697
------ ------ ------ ------
Total from investment operations ...................................... 1.145 1.335 2.100 2.170
------ ------ ------ ------
Less dividends and distributions:
Dividends from net investment income .................................. (0.405) (0.525) (0.420) (0.240)
Distributions from net realized gain on investments ................... (1.230) (0.050) (0.270) none
------ ------ ------ ------
Total dividends and distributions ..................................... (1.635) (0.575) (0.690) (0.240)
------ ------ ------ ------
Net asset value, end of period ........................................... $13.610 $14.100 $13.340 $11.930
====== ====== ====== ======
Total return(4) .......................................................... 9.07% 10.34% 18.38% 21.88%

Ratios and supplemental data:
Net assets, end of period (000 omitted) ............................... $2,627 $2,310 $2,203 $2,191
Ratio of expenses to average net assets ............................... 1.25% 0.95% 0.95% 0.95%
Ratio of expenses to average net assets prior to expense
limitation ........................................................... 1.69% 1.86% 2.42% 7.25%
Ratio of net investment income to average net assets .................. 2.47% 3.54% 4.43% 5.05%
Ratio of net investment income (loss) to average net assets
prior to expense limitation .......................................... 2.03% 2.63% 2.96% (1.25%)
Portfolio turnover .................................................... 90% 74% 34% 57%
</TABLE>

- ----------------------
(1) Per share information for the years ended November 30, 1997 and 1998 was
based on the average shares outstanding method.
(2) Date of commencement of trading.
(3) Date of commencement of trading; ratios have been annualized and total
return has not been annualized.
(4) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(5) The ratios of expenses and net investment income to average net assets,
portfolio turnover and total return have been omitted as management believes
that such ratios and total return for this relatively short period are not
meaningful.
(6) Effective July 21, 1998, the Series was renamed the Global Equity Series
(formerly the Global Assets Series) and its investment focus was changed,
eliminating the Series bond component in favor of stocks.

See accompanying notes
<PAGE>

for international diversification 33

FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Series outstanding throughout each period
were as follows:
<TABLE>
<CAPTION>
EMERGING MARKETS SERIES A CLASS EMERGING MARKETS SERIES B CLASS
--------------------------------- ---------------------------------
6/10/96(2) 6/10/96(2)
YEAR ENDED TO YEAR ENDED TO
11/30/98 11/30/97 11/30/96 11/30/98 11/30/97 11/30/96
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........................ $10.200 $9.970 $10.000 $10.110 $9.940 $10.000

Income (loss) from investment operations:
Net investment income (loss)(1) .......................... 0.129 0.062 0.018 0.070 (0.020) (0.051)
Net realized and unrealized gain (loss) on investments
and foreign currencies .................................. (3.174) 0.253 (0.048) (3.135) 0.265 (0.009)
------ ------ ------- ------ ------ -------
Total from investment operations ......................... (3.045) 0.315 (0.030) (3.065) 0.245 (0.060)
------ ------ ------- ------ ------ -------
Less dividends and distributions:

Dividends from net investment income ..................... (0.020) (0.010) none none none none
Distributions from net realized gain on investments ...... (0.605) (0.075) none (0.605) (0.075) none
------ ------ ------- ------ ------ -------
Total dividends and distributions ........................ (0.625) (0.085) none (0.605) (0.075) none
------ ------ ------- ------ ------ -------
Net asset value, end of period .............................. $6.530 $10.200 $9.970 $6.440 $10.110 $9.940
====== ====== ======= ====== ====== =======
Total return(3) ............................................. (31.66%) 3.19% (0.30%) (32.11%) 2.48% (0.60%)

Ratios and supplemental data:

Net assets, end of period (000 omitted) .................. $5,584 $9,665 $2,518 $2,528 $3,484 $282
Ratio of expenses to average net assets .................. 1.96% 2.00% 2.00% 2.70% 2.70% 2.70%
Ratio of expenses to average net assets prior to expense
limitation ............................................. 3.91% 3.02% 4.10% 4.61% 3.72% 4.80%
Ratio of net investment income (loss) to average net assets 1.58% 0.52% 0.17% 0.84% (0.18%) (0.53%)
Ratio of net investment income (loss) to average net assets
prior to expense limitation ............................ (0.37%) (0.50%) (1.93%) (1.07%) (1.20%) (2.63%)
Portfolio turnover ....................................... 47% 65% 36% 47% 65% 36%
</TABLE>

- ----------------------
(1) Per share information was based on the average shares outstanding method.
(2) Date of commencement of trading; ratios have been annualized and total
return has not been annualized.
(3) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.

See accompanying notes
<PAGE>

34 for international diversification

FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Series outstanding throughout each period
were as follows:
<TABLE>
<CAPTION>
EMERGING MARKETS SERIES
EMERGING MARKETS SERIES C CLASS INSTITUTIONAL CLASS
---------------------------------- ----------------------------------
6/10/96(2) 6/10/96(2)
YEAR ENDED TO YEAR ENDED TO
11/30/98 11/30/97 11/30/96 11/30/98 11/30/97 11/30/96
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ....................... $10.110 $9.940 $10.000 $10.250 $9.990 $10.000

Income (loss) from investment operations:
Net investment income (loss)(1) ......................... 0.068 (0.019) (0.051) 0.151 0.098 0.047
Net realized and unrealized gain (loss) on investments
and foreign currencies ................................. (3.143) 0.264 (0.009) (3.191) 0.262 (0.057)
------ ------ ------- ------ ------ -------
Total from investment operations ........................ (3.075) 0.245 (0.060) (3.040) 0.360 (0.010)
------ ------ ------- ------ ------ -------
Less dividends and distributions:
Dividends from net investment income .................... none none none (0.055) (0.025) none
Distributions from net realized gain on investments ..... (0.605) (0.075) none (0.605) (0.075) none
------ ------ ------- ------ ------ -------
Total dividends and distributions ....................... (0.605) (0.075) none (0.660) (0.100) none
------ ------ ------- ------ ------ -------
Net asset value, end of period ............................. $6.430 $10.110 $9.940 $6.550 $10.250 $9.990
====== ====== ======= ====== ====== =======

Total return(3) ............................................ (32.21%) 2.48% (0.60%) (31.55%) 3.64% (0.10%)

Ratios and supplemental data:
Net assets, end of period (000 omitted) ................. $884 $1,519 $199 $1,117 $1,916 $3,717
Ratio of expenses to average net assets ................. 2.70% 2.70% 2.70% 1.70% 1.70% 1.70%
Ratio of expenses to average net assets prior to expense
limitation ............................................ 4.61% 3.72% 4.80% 3.61% 2.72% 3.80%
Ratio of net investment income (loss) to average net
assets ................................................ 0.84% (0.18%) (0.53%) 1.84% 0.82% 0.47%
Ratio of net investment income (loss) to average net
assets prior to expense limitation .................... (1.07%) (1.20%) (2.63%) (0.07%) (0.20%) (1.63%)
Portfolio turnover 47% 65% 36% 47% 65% 36%
</TABLE>
- ----------------------
(1) Per share information was based on the average shares outstanding method.
(2) Date of commencement of trading; ratios have been annualized and total
return has not been annualized.
(3) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.

See accompanying notes
<PAGE>

for international diversification 35

DELAWARE GROUP
GLOBAL & INTERNATIONAL FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
NOVEMBER 30, 1998
- --------------------------------------------------------------------------------

Delaware Group Global & International Funds, Inc. (the Fund) is registered as a
Maryland corporation and offers six series: the International Equity Series, the
Global Bond Series, the Global Equity Series (formerly the Global Assets
Series), the Emerging Markets Series, the Global Opportunities Series and the
International Small Cap Series. These financial statements and the related notes
pertain to the International Equity Series, the Global Bond Series, the Global
Equity Series and the Emerging Markets Series (the Series). The International
Equity Series is registered as a diversified open-end investment company, and
the Global Bond Series, the Global Equity Series and the Emerging Markets Series
are registered as non-diversified open-end investment companies under the
Investment Company Act of 1940, as amended. Each Series offers four classes of
shares. The A Class carries a front-end sales charge of 5.75% for all Series
except the Global Bond Series, which is 4.75%. The B Class carries a back-end
deferred sales charge, the C Class carries a level load sales charge and the
Institutional Class has no sales charge.

The investment objective of each Series is as follows:

INTERNATIONAL EQUITY SERIES: To seek long-term growth without undue risk to
principal by investing primarily in international equity securities with the
potential for capital appreciation and income.

GLOBAL BOND SERIES: To seek current income consistent with the preservation of
principal by investing primarily in international bonds that may also provide
the potential for capital appreciation.

GLOBAL EQUITY SERIES: To seek long-term total return by investing in securities,
including U.S. and foreign stocks, with the potential for capital appreciation
and income.

EMERGING MARKETS SERIES: To seek long-term capital appreciation by investing
primarily in equity securities of issuers located or operating in emerging
market countries.

1. SIGNIFICANT ACCOUNTING POLICIES
The following accounting policies are in accordance with generally accepted
accounting principles and are consistently followed by the Fund.

SECURITY VALUATION - Securities listed on an exchange are valued at the last
quoted sales price as of the close of the NYSE on the valuation date. Securities
not traded or securities not listed on an exchange are valued at the mean of the
last quoted bid and asked prices. Securities listed on a foreign exchange are
valued at the last quoted sales price before each Series is valued. Long-term
debt securities are valued by an independent pricing service and such prices are
believed to reflect the fair value of such securities. Money market instruments
having less than 60 days to maturity are valued at amortized cost, which
approximates market value. Other securities and assets for which market
quotations are not readily available are valued at fair value as determined in
good faith by or under the direction of the Funds Board of Directors.

FEDERAL INCOME TAXES - Each Series intends to continue to qualify as a regulated
investment company and make the requisite distributions to shareholders.
Accordingly, no provision for federal income taxes has been made in the
financial statements. Income and capital gain distributions are determined in
accordance with federal income tax regulations, which may differ from generally
accepted accounting principles.

CLASS ACCOUNTING - Investment income, common expenses and realized and
unrealized gain (loss) on investments are allocated to the various classes of
each Series on the basis of daily net assets of each class. Distribution
expenses relating to a specific class are charged directly to that class.
<PAGE>

REPURCHASE AGREEMENTS - Each Series may invest in a pooled cash account along
with other members of the Delaware Investments Family of Funds. The aggregate
daily balance of the pooled cash account is invested in repurchase agreements
secured by obligations of the U.S. government. The respective collateral is held
by the custodian bank until the maturity of the respective repurchase
agreements. Each repurchase agreement is at least 100% collateralized. However,
in the event of default or bankruptcy by the counterparty to the agreement,
realization of the collateral may be subject to legal proceedings.

FOREIGN CURRENCY TRANSACTIONS - Transactions denominated in foreign currencies
are recorded at the prevailing exchange rates on the valuation date. The value
of all assets and liabilities denominated in foreign currencies are translated
into U.S. dollars at the exchange rate of such currencies against the U.S.
dollar as of 3:00 PM EST. Transaction gains or losses resulting from changes in
exchange rates during the reporting period or upon settlement of the foreign
currency transaction are reported in operations for the current period. It is
not practical to isolate that portion of both realized and unrealized gains and
losses on investments in equity securities in the statement of operations that
result from fluctuations in foreign currency exchange rates. The Series do
isolate that portion of gains and losses on investments of debt securities which
are due to changes in the foreign currency exchange rate from that which are due
to changes in the market prices of debt securities. The Series report certain
foreign currency related transactions as components of realized gains (losses)
for financial reporting purposes, whereas such components are treated as
ordinary income (loss) for federal income tax purposes.

USE OF ESTIMATES - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.

OTHER - Expenses common to all funds within the Delaware Investments Family of
Funds are allocated amongst the funds on the basis of average net assets.
Security transactions are recorded on the date the securities are purchased or
sold (trade date). Costs used in calculating realized gains and losses on the
sale of investment securities are those of the specific securities sold.
Dividend income is recorded on the ex-dividend date and interest income is
recorded on the accrual basis. Foreign dividends are also recorded on the
ex-dividend date or as soon after the ex-dividend date that the Series are aware
of such dividends, net of all non-rebatable tax withholdings. Original issue
discounts are accreted to interest income over the lives of the respective
securities. Withholding taxes on foreign dividends have been provided for in
accordance with the Series understanding of the applicable countrys tax rules
and rates. Each Series declares and pays dividends from capital gains annually
and from net investment income as follows: the International Equity Series, the
Global Equity Series and the Global Bond Series quarterly and the Emerging
Markets Series annually.

Certain expenses of the Series are paid through soft dollar arrangements with
brokers. The amount of these expenses is less than 0.01% of each Series average
daily net assets.

2. INVESTMENT MANAGEMENT AND OTHER TRANSACTIONS WITH AFFILIATES
In accordance with the terms of the Investment Management Agreement, each Series
pays Delaware International Advisers Ltd. (DIAL), the Investment Manager, an
annual fee based on its net assets, less the fees paid to the unaffiliated
directors for the International Equity Series, the Global Equity Series and the
Global Bond Series. The management fee for the Emerging Markets Series is
without consideration of amounts paid to unaffiliated directors. DIAL has
entered into a sub-advisory agreement with Delaware Management Company (DMC), an
affiliate, with respect to the management of the Global Equity Series investment
in U.S. securities. DMC receives 25% of the management fee paid to DIAL for
managing the U.S.

<PAGE>
36 for international diversification

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

2. INVESTMENT MANAGEMENT AND OTHER TRANSACTIONS WITH AFFILIATES (CONTINUED)
The management fee rates are as follows:
<TABLE>
<CAPTION>
INTERNATIONAL GLOBAL GLOBAL EMERGING
EQUITY BOND EQUITY MARKETS
SERIES SERIES SERIES SERIES
---------------------------------------------
<S> <C> <C> <C> <C>
Management fee as a percentage of average daily net assets (per annum) .... 0.75% 0.75% 0.75% 1.25%
</TABLE>

DIAL has elected to waive its fees and reimburse each Series to the extent that
annual operating expenses, exclusive of taxes, interest, brokerage commissions,
extraordinary expenses and distribution expenses, exceed 1.55% for each class of
the International Equity Series and the Global Equity Series, 0.95% for each
class of the Global Bond Series and 1.70% for each class of the Emerging Markets
Series of the average daily net assets for each Series through May 31, 1999.
Prior to June 1, 1998, such expenses for the Global Equity Series were limited
to 0.95%

The Series have engaged Delaware Service Company, Inc. (DSC), an affiliate of
DMC, to provide dividend disbursing, transfer agent and accounting services.
Each Series pays DSC a monthly fee based on the number of shareholder accounts,
shareholder transactions and average net assets, subject to certain minimums.

On November 30, 1998, the Series had payables to affiliates as follows:
<TABLE>
<CAPTION>
INTERNATIONAL GLOBAL GLOBAL EMERGING
EQUITY BOND EQUITY MARKETS
SERIES SERIES SERIES SERIES
------------------------------------------------
<S> <C> <C> <C> <C>
Investment Management fee payable to DIAL ........... $177,540 $7,867 -- --
Dividend disbursing, transfer agent fees, accounting
fees and other expenses payable to DSC ............. 97,468 4,664 $10,419 $8,298
</TABLE>
<PAGE>

Pursuant to the Distribution Agreement, each Series pays Delaware Distributors,
L.P. (DDLP), the Distributor and an affiliate of DMC, an annual fee not to
exceed 0.30% of the average daily net assets of the A Class and 1.00% of the
average daily net assets of the B and C Classes. For the period February 1, 1998
through July 31, 1999, DDLP has elected to waive its fees to ensure that the
annual fee received from the Emerging Markets Series A Class does not exceed
0.25% of the average daily net assets.

For the year ended November 30, 1998, DDLP earned commissions on sales of the A
Class shares for each Series as follows:

INTERNATIONAL GLOBAL GLOBAL EMERGING
EQUITY BOND EQUITY MARKETS
SERIES SERIES SERIES SERIES
------------------------------------------------------
$68,957 $2,758 $6,538 $7,584

Certain officers of DMC, DSC and DDLP are officers, directors and/or employees
of the Fund. These officers, directors and employees are paid no compensation by
the Fund.

3. INVESTMENTS

During the year ended November 30, 1998, each Series made purchases and sales of
investment securities other than U.S. government securities and temporary cash
investments as follows:
<TABLE>
<CAPTION>
INTERNATIONAL GLOBAL GLOBAL EMERGING
EQUITY BOND EQUITY MARKETS
SERIES SERIES SERIES SERIES
-------------------------------------------------
<S> <C> <C> <C> <C>
Purchases ....................................... $116,958,859 $15,327,605 $17,100,125 $6,535,182
Sales ........................................... 13,633,745 10,079,094 14,674,593 6,249,814
</TABLE>
At November 30, 1998, the aggregate cost of securities and unrealized
appreciation (depreciation) for federal income tax purposes for each Series were
as follows:
<TABLE>
<CAPTION>
INTERNATIONAL GLOBAL GLOBAL EMERGING
EQUITY BOND EQUITY MARKETS
SERIES SERIES SERIES SERIES
--------------------------------------------------------------
<S> <C> <C> <C> <C>
Cost of investments ............................ $312,063,329 $19,532,249 $17,365,533 $17,416,212
============ =========== =========== ===========
Aggregate unrealized appreciation .............. $53,716,365 $543,282 $1,907,342 $107
Aggregate unrealized depreciation .............. (20,634,223) (730,181) (600,875) (7,303,582)
------------ ----------- ----------- -----------
Net unrealized appreciation (depreciation) ..... $33,082,142 ($186,899) $1,306,467 ($7,303,475)
============ =========== =========== ===========
</TABLE>

For federal income tax purposes, the Fund had accumulated capital losses at
November 30, 1998 for each Series as follows:

YEAR OF EXPIRATION
2006
------------------
International Equity Series ........................ $2,837,854

Emerging Markets Series ............................ 1,188,491
<PAGE>
for international diversification 37

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

4. CAPITAL STOCK

Transactions in capital stock shares were as follows:
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY GLOBAL BOND
SERIES SERIES
----------------------- ----------------------
YEAR ENDED YEAR ENDED
11/30/98 11/30/97 11/30/98 11/30/97
<S> <C> <C> <C> <C>
Shares sold:
A Class ..................................................... 16,564,864 6,322,583 113,649 251,836
B Class ..................................................... 4,073,265 3,317,692 34,421 65,290
C Class ..................................................... 7,476,066 1,288,076 4,332 55,133
Institutional Class ......................................... 8,697,007 3,519,724 393,104 504,713

Shares issued upon reinvestment of distributions from
net investment income and net realized gain on investments:
A Class ..................................................... 275,722 193,856 11,830 24,085
B Class ..................................................... 60,552 20,835 2,915 4,494
C Class ..................................................... 20,437 4,643 2,026 2,867
Institutional Class ......................................... 207,907 86,399 52,808 62,112
----------- ---------- --------- ---------
37,375,820 14,753,808 615,085 970,530
----------- ---------- --------- ---------
Shares repurchased:
A Class .....................................................(16,518,776) (4,933,746) (120,563) (154,612)
B Class ..................................................... (3,853,029) (1,893,676) (28,855) (31,190)
C Class ..................................................... (7,386,503) (611,809) (22,294) (2,843)
Institutional Class ......................................... (3,016,912) (1,096,146) (305,570) (106,037)
----------- ---------- --------- ---------
(30,775,220) (8,535,377) (477,282) (294,682)
----------- ---------- --------- ---------
Net increase ................................................ 6,600,600 6,218,431 137,803 675,848
=========== ========== ========= =========
<CAPTION>
GLOBAL EQUITY EMERGING MARKETS
SERIES SERIES
----------------------- ---------------------
YEAR ENDED YEAR ENDED
11/30/98 11/30/97 11/30/98 11/30/97
Shares sold:
A Class ..................................................... 176,582 256,603 415,378 1,427,852
B Class ..................................................... 101,799 163,601 123,871 469,643
C Class ..................................................... 54,271 136,936 58,715 140,946
Institutional Class ......................................... 39,144 15,591 138,485 193,572

<PAGE>

38 for international diversification

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------
5. LINES OF CREDIT
The Fund has a committed line of credit for $10.8 million for the International
Equity Series, $900,000 for the Global Bond Series, $1 million for the Global
Equity Series and $900,000 for the Emerging Markets Series. No amounts were
outstanding at November 30, 1998, or at any time during the fiscal year.

6. FOREIGN EXCHANGE CONTRACTS
A Series will generally enter into forward foreign currency contracts as a way
of managing foreign exchange rate risk. A Series may enter into these contracts
to fix the U.S. dollar value of a security that it has agreed to buy or sell for
the period between the date the trade was entered into and the date the security
is delivered and paid for. A Series may also use these contracts to hedge the
U.S. dollar value of securities it already owns denominated in foreign
currencies.

Forward foreign currency contracts are valued at the mean between the bid and
asked prices of the contracts and are marked-to-market daily. Interpolated
values are derived when the settlement date of the contract is an interim date
for which quotations are not available. The change in market value is recorded
as an unrealized gain or loss. When the contract is closed, a realized gain or
loss equal to the difference between the value of the contract at the time it
was opened and the value at the time it was closed is recorded.

The use of forward foreign currency contracts does not eliminate fluctuations in
the underlying prices of the securities, but it does establish a rate of
exchange that can be achieved in the future. Although forward foreign currency
contracts limit the risk of loss due to a decline in the value of the hedged
currency, they also limit any potential gain that might result should the value
of the currency increase. In addition, a Series could be exposed to risks if the
counterparties to the contracts are unable to meet the terms of their contracts.

The following forward foreign currency contracts were outstanding at November
30, 1998:

INTERNATIONAL EQUITY SERIES
<TABLE>
<CAPTION>
VALUE OF UNREALIZED
CONTRACTS TO IN EXCHANGE CONTRACT AT SETTLEMENT APPRECIATION
DELIVER FOR 11/30/98 DATE (DEPRECIATION)
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
13,773,956 British Pounds $23,243,000 $22,668,970 1/29/99 $574,030
22,310,390 Japanese Yen 180,953 181,128 12/2/98 (175)

GLOBAL EQUITY SERIES

CONTRACTS TO
DELIVER
- -------------------------------------------------------------------------------------------------------------------
829,349 British Pounds $1,398,000 $1,364,930 1/29/99 $33,070
</TABLE>

7. MARKET AND CREDIT RISK

Some countries in which the Series may invest require governmental approval for
the repatriation of investment income, capital or the proceeds of sales of
securities by foreign investors. In addition, if there is a deterioration in a
countrys balance of payments or for other reasons, a country may impose
temporary restrictions on foreign capital remittances abroad.

The securities exchanges of certain foreign markets are substantially smaller,
less liquid and more volatile than the major securities markets in the United
States. Consequently, acquisition and disposition of securities by the Series
may be inhibited. In addition, a significant proportion of the aggregate market
value of equity securities listed on the major securities exchanges in emerging
markets are held by a smaller number of investors. This may limit the number of
shares available for acquisition or disposition by the Series.

The Series may invest in high-yield fixed income securities which carry ratings
of BB or lower by S&P and/or Ba or lower by Moodys. Investments in these higher
yielding securities may be accompanied by a greater degree of credit risk than
higher rated securities. Additionally, lower rated securities may be more
susceptible to adverse economic and competitive industry conditions than
investment grade securities.

With the exception of the Emerging Markets Series, each Series may invest up to
10% of its total assets in illiquid securities which may include securities with
contractual restrictions on resale, securities exempt from registration under
Rule 144A of the Securities Act of 1933, as amended, and other securities which
may not be readily marketable. The Emerging Markets Series may invest up to 15%
in such securities. The relative illiquidity of some of these securities may
adversely affect the Series ability to dispose of such securities in a timely
manner and at a fair price when it is necessary to liquidate such securities.
<PAGE>

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------
8. SECURITIES LENDING

The International Equity Series may participate, along with other funds in the
Delaware Investments Family of Funds, in a Securities Lending Agreement (Lending
Agreement). Security loans made pursuant to the Lending Agreement are required
at all times to be secured by U.S. Treasury obligations and/or cash collateral
at least equal to 100% of the market value of securities issued in the U.S. and
105% of the market value of securities issued outside of the U.S. Cash
collateral received is invested in fixed income securities, with a weighted
average maturity not to exceed 90 days, rated in one of the top two tiers by
Standard & Poors Ratings Group or Moodys Investors Service, Inc. or repurchase
agreements collateralized by such securities. However, in the event of default
or bankruptcy by the lending agent, realization and/or retention of the
collateral may be subject to legal proceedings. In the event that the borrower
fails to return loaned securities and the collateral received is insufficient to
cover the value of the loaned securities and provided such collateral is not the
result of investment losses, the lending agent has agreed to pay the amount of
the shortfall to the Series, or at the discretion of the lending agent, replace
the loaned securities. The market value of the securities on loan and the
related collateral received at November 30, 1998 were as follows:

MARKET VALUE OF
SECURITIES ON LOAN COLLATERAL
--------------------------------------
International Equity Series .......... $32,076,687 $33,305,685

Net income from securities lending activities for the year ended November 30,
1998 was $172,683 and is included in interest income on the statement of
operations.

9. SUBSEQUENT EVENT

Each Series declared dividends from net investment income and distributions from
net realized gain on investments payable December 30, 1998, to shareholders of
record December 21, 1998.

Distributions from net realized gain on investments for all classes were as
follows:

INTERNATIONAL GLOBAL GLOBAL EMERGING
EQUITY BOND EQUITY MARKETS
SERIES SERIES SERIES SERIES
------------------------------------------------------------------------
-- $0.105 $0.680 --

<PAGE>

40 for international diversification

DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS, INC.
REPORT OF INDEPENDENT AUDITORS
- --------------------------------------------------------------------------------
TO THE SHAREHOLDERS AND BOARD OF DIRECTORS DELAWARE GROUP GLOBAL & INTERNATIONAL
FUNDS, INC.

We have audited the accompanying statement of net assets of Delaware Group
Global & International Funds, Inc. (International Equity Series, Global Bond
Series, Global Equity Series and Emerging Markets Series) (the Funds) as of
November 30, 1998, and the related statements of operations for the year then
ended, the statements of changes in net assets for each of the two years in the
period then ended, and the financial highlights for each of the periods
indicated therein. These financial statements and financial highlights are the
responsibility of the Funds management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements and financial highlights. Our procedures included confirmation of
securities owned as of November 30, 1998, by correspondence with the Funds
custodian and brokers. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of each
of the respective series of Delaware Group Global & International Funds, Inc. at
November 30, 1998, the results of their operations for the year then ended, the
changes in their net assets for each of the two years in the period then ended,
and their financial highlights for the periods indicated therein, in conformity
with generally accepted accounting principles.

/s/ Ernst & Young LLP
---------------------
Ernst & Young LLP
Philadelphia, Pennsylvania
January 8, 1999

<PAGE>

THIS ANNUAL REPORT IS FOR THE INFORMATION OF GLOBAL & INTERNATIONAL FUNDS
SHAREHOLDERS, but it may be used with prospective investors when preceded or
accompanied by current Prospectuses for International Equity Fund, Emerging
Markets Fund, Global Equity Fund, and Global Bond Fund, which set forth details
about charges, expenses, investment objectives and operating policies of each
Fund. You should read the prospectus carefully before you invest. The figures in
this report represent past results which are not a guarantee of future results.
The return and principal value of an investment in each Fund will fluctuate so
that shares, when redeemed, may be worth more or less than their original cost.

BOARD OF DIRECTORS
JEFFREY J. NICK
Chairman, President and Chief Executive Officer
Delaware Investments Family of Funds
Philadelphia, PA

WALTER P. BABICH
Board Chairman, Citadel Constructors, Inc.
King of Prussia, PA

JOHN H. DURHAM
Partner, Complete Care Services
Horsham, PA

ANTHONY D. KNERR
Consultant, Anthony Knerr & Associates
New York, NY

ANN R. LEVEN
Treasurer, National Gallery of Art
Washington, DC

W. THACHER LONGSTRETH
City Councilman
Philadelphia, PA

THOMAS F. MADISON
President and Chief Executive Officer
MLM Partners, Inc.
Minneapolis, MN

CHARLES E. PECK
Secretary/Treasurer, Enterprise Homes, Inc.
Fredericksburg, VA

WAYNE A. STORK
Chairman
Delaware Management Holdings, Inc.
Philadelphia, PA
<PAGE>

AFFILIATED OFFICERS
DAVID K. DOWNES
Executive Vice President, Chief Financial Officer
and Chief Operating Officer
Delaware Investments Family of Funds
Philadelphia, PA

GEORGE M. CHAMBERLAIN, JR.
Senior Vice President, Secretary
and General Counsel
Delaware Investments Family of Funds
Philadelphia, PA

BRUCE D. BARTON
President and Chief Executive Officer
Delaware Distributors, L.P.
Philadelphia, PA

directors
& officers
- --------------------------------------------------------------------------------
INVESTMENT MANAGER
Delaware Management Company
Philadelphia, Pennsylvania

INTERNATIONAL AFFILIATE
Delaware International Advisers Ltd.
London, England

NATIONAL DISTRIBUTOR
Delaware Distributors, L.P.
Philadelphia, Pennsylvania

SHAREHOLDER SERVICING,
DIVIDEND DISBURSING
AND TRANSFER AGENT
Delaware Service Company, Inc.
Philadelphia, Pennsylvania

1818 Market Street
Philadelphia, PA 19103-3682

<PAGE>

[photo of globes]

When used with prospective investors, this report must be preceded or
accompanied by current International Equity Fund, Emerging Markets Fund, Global
Equity Fund, and Global Bond Fund Prospectuses and the Delaware Investments
Performance Updates for the most recently completed calendar quarter. For a
prospectus of any other mutual fund from Delaware Investments, contact your
financial adviser or Delaware Investments.

For Shareholders
1.800.523.1918

For Securities Dealers
1.800.362.7500

For Financial Institutions
Representatives Only
1.800.659.2265

www.delawarefunds.com

International investing has special risks that include less stable economies and
governments, currency fluctuations and different accounting standards.

Be sure to consult your financial adviser when making investments. Mutual funds
can be a valuable part of your financial plan; however, shares of the Funds are
not FDIC or NCUSIF insured, are not guaranteed by any bank or any credit union,
and involve investment risk, including the possible loss of the principal amount
invested. Shares of the Funds are not bank or credit union deposits.

DELAWARE(SM)
INVESTMENTS
- -------------------
PHILADELPHIA*LONDON

Printed in the USA
on recycled paper

(1377)
AR-034[11/98]TKO1/99