<PAGE>
1999 ANNUAL SHAREHOLDER REPORT
- ------------------------------
Delaware Limited Distribution International Funds
- - Delaware Global Opportunities Fund
- - Delaware International Small Cap Fund
- - Delaware New Europe Fund
- - Delaware Latin America Fund
January 17, 2000
Dear Shareholder:
Recap of events - Over the last fiscal year, international investors found cause
for optimism as financial turbulence around the world subsided and economic
conditions began to stabilize. Around the globe, as in the United States, lower
interest rates helped turn the tide.
Last December, at the start of the Funds' fiscal year, the central banks of 11
euro-zone nations cut rates to a uniform 3.0%. Many other nations abroad,
including the United Kingdom, New Zealand and countries in the Pacific Rim
followed suit. Lower borrowing costs eased concerns about global economic
stability and helped ease a credit crunch in world markets, which enabled
businesses to expand and operate more profitably.
Emerging markets bounced back strongly from their disappointing 1998
performance. Brazil, in particular, demonstrated steady improvement after
devaluing its currency early in 1999, suggesting to us that the country may be
through the worst of its problems. Within Europe, we were cautious about the
prospects for the euro and focused on countries that did not participate in the
European Monetary Union convergence. We focused instead on the United Kingdom,
for example, and select countries in Europe, such as France.
After months of weakness, the economies in eastern Asia appear to be
strengthening. Many corporations in the area have restructured and are operating
more efficiently. Governments have adopted pro-business policy changes that are
stimulating economic growth in the region.
Delaware Global Opportunities Fund invests in a broad range of stocks from
around the world. The Fund reported a total return of 2.78% (Class A shares at
net asset value with distributions reinvested) for the one-year period ended
November 30, 1999. The Fund's performance lagged the Morgan Stanley Capital
International (MSCI) World Index, an unmanaged index, which reported a total
return of 15.94% for the period. Smaller positions in Japan and the U.S. worked
against our Fund, explaining our underperformance for the period. The Fund
focused instead on the United Kingdom, Australia and New Zealand, where we
believed there were more value opportunities available.
Delaware International Small Cap Fund, which seeks long-term capital
appreciation, performed well during fiscal 1999. The Fund provided a 22.74%
return (Institutional Class shares with distributions reinvested) for the
one-year period ended November 30, 1999, compared to a total return of 16.60%
for its benchmark MSCI Europe Australia Far East Small Cap Index for the same
period. The Fund invests primarily in equity securities of smaller foreign
companies, which may include companies located or operating in emerging or
established countries. The market capitalization of the companies that the Fund
intends to invest in will generally be $1.5 billion or less at the time of
purchase.
<PAGE>
Delaware Latin America Fund provided a total return of 25.29% (Class A shares at
net asset value with distributions reinvested) since the Fund's inception on
December 29, 1998. The Fund's benchmark, MSCI Emerging Market Free Latin America
Index, an unmanaged index, had a total return of 37.28% for the same period. The
Fund's performance was hurt early in the year by its heavy investment in Brazil
and Mexico and its significant cash position during the Fund's start-up period.
Delaware New Europe Fund, seeks long-term capital appreciation by investing
primarily in equity securities of companies organized, having a majority of
their assets or deriving a majority of their operating income in established and
emerging European countries. The Fund invests in companies of varying size. The
equity securities in which the Fund may invest include common stocks, preferred
stocks, rights or warrants to purchase common stocks and securities convertible
into common stocks. The Fund provided a total return of -0.82% (Class A shares
at net asset value with distributions reinvested) from its inception on December
29, 1998 through November 30, 1999. The Fund's benchmark MSCI Europe Index
provided a total return of 5.40% for the period. The Fund's value-oriented stock
selection worked against the Fund as investors continued to focus primarily on
growth stocks during most of the fiscal year. We expect continued economic
growth in Europe in the months ahead. We believe your Fund is well positioned to
benefit from this growth.
Market Outlook - In spite of the brightening global economic landscape, "value"
investments, stocks that appear to be selling for less than their true worth,
took a back seat to more expensive "growth" investments, mirroring what we've
seen in the United States. For most of the fiscal year, investors seemed willing
to pay higher prices for stocks of companies with faster growing and more
reliable earnings. This is a key reason our global and international funds,
which have a strong value approach, underperformed their benchmarks.
Investor bias toward growth companies began to shift in early 1999, supported by
the remarkable performance of cyclical stocks, long-overlooked investments that
are often a staple of value funds. We believe our global and international funds
are positioned to benefit if interest in undervalued investments broadens in
2000.
You will find more detailed performance information for fiscal 1999 for the
Funds covered in this report on the pages that follow.
We thank you for your continued confidence in Delaware Investments' global and
international offerings.
Sincerely,
/s/ Wayne A. Stork
- ---------------------------------
Wayne A. Stork
Chairman,
Delaware Investments Family of Funds
/s/ David K. Downes
- ----------------------------------
David K. Downes
President and Chief Executive Officer,
Delaware Investments Family of Funds
This annual report is for the information of Delaware Global Opportunities
Fund, Delaware International Small Cap Fund, Delaware Latin America Fund and
Delaware New Europe Fund shareholders. The current prospectus for each Fund sets
forth details about charges, expenses, investment objectives and operating
policies of each Fund. You should read the prospectus carefully before you
invest or send money. Summary investment results are documented in each Fund's
current Statement of Additional Information.
<PAGE>
Performance Summary
Delaware Global Opportunities Fund
Growth of a $10,000 Investment
July 22, 1997 to November 30,1999
MSCI World Index
Global Opportunities Fund Class A
Global Opportunities Market
Fund Index Value
---------- -----
Jul-97 $10,000 $ 9,568
Aug-97 $ 9,300 $ 9,058
Oct-97 $ 9,300 $ 9,035
Nov-97 $ 9,600 $ 9,124
Dec-98 $ 9,900 $ 9,327
Jan-98 $11,000 $ 9,394
Mar-98 $10,900 $10,417
May-98 $11,200 $10,293
Jul-98 $ 9,800 $10,203
Sep-98 - $ 9,237
Nov-98 $10,700 $10,226
Jan-99 $12,200 $10,286
Mar-99 $12,400 $10,357
May-99 $12,400 $10,521
Jul-99 $12,900 $10,838
Sep-99 $12,800 $10,275
Nov-99 $13,800 $10,509
The chart above assumes a $10,000 investment in the Fund from July 22, 1997
through November 30, 1999 and includes the impact of the maximum 5.75% front-end
sales charge and the reinvestment of distributions. Performance of the
Institutional Class will vary due to different charges and expenses. Past
performance is not a guarantee of future results. The performance above includes
the effect of expense limitations, which have been in effect since the Fund's
inception. Without the limitations, performance would have been lower.
The maximum front-end sales charge for Class A shares is 5.75%. Shares may be
purchased at net asset value under certain circumstances. Class A shares have a
12b-1 fee that has been waived since inception. Voluntary expense caps have been
in effect. Returns would have been lower without the expense waivers.
International stocks involve greater risks than investing in U.S. stocks. Return
and share value will fluctuate so that shares, when redeemed, may be worth more
or less than the original cost.
Delaware Global Opportunities Fund
Average Annual Returns Through November 30, 1999
- ------------------------------------------------------------------------------
Lifetime One Year
- ------------------------------------------------------------------------------
Class A (Est. 7/22/97)
- ------------------------------------------------------------------------------
Excluding Sales Charge +4.72% +2.78%
Including Sales Charge +2.12% -3.18%
- ------------------------------------------------------------------------------
Institutional Class +4.72% +2.89%
- ------------------------------------------------------------------------------
<PAGE>
Delaware International Small Cap Fund
Growth of a $10,000 Investment
December 19, 1997 to November 30,1999
Morgan Stanley Europe, Asia, Far East Small Cap Index
Delaware International Small Cap Fund Institutional Class
International Small Cap Institutional Class
-------------------------------------------
Dec-97 $10,094
Jan-98 $10,129
Mar-98 $11,588
May-98 $11,494
Jul-98 $10,376
Sep-98 $ 8,976
Nov-98 $10,588
Jan-99 $10,513
Mar-99 $10,743
May-99 $11,627
Jul-99 $12,814
Sep-99 $13,444
Nov-99 $12,996
The chart above assumes a $10,000 investment in the Fund from December 19, 1997
through November 30, 1999 and reinvestment of distributions. Past performance is
not a guarantee of future results. The performance above includes the effect of
expense limitations, which have been in effect since the Fund's inception.
Without the limitations, performance would have been lower.
International stocks involve greater risks than investing in U.S. stocks. Return
and share value will fluctuate so that shares, when redeemed, may be worth more
or less than the original cost.
Delaware International Small Cap Fund
Average Annual Returns Through November 30, 1999
<PAGE>
- --------------------------------------------------------------------------------
Lifetime One Year
- --------------------------------------------------------------------------------
Institutional Class (Est. 12/19/97) 14.38% 22.74%
- --------------------------------------------------------------------------------
As of the date of this report, one share of Class A is outstanding. Therefore,
performance for Class A can be expected to vary due to different charges and
expenses.
Delaware Latin America Fund
Growth of a $10,000 Investment
December 29, 1998 to November 30,1999
MSCI Emerging Market Free Latin America Index
Delaware Latin America Fund Class A
Latin America Market
Fund Index Value
------------- ------
Dec-98 $10,000 $ 9,379
Jan-99 $ 9,800 $ 8,570
Mar-99 $11,200 $10,410
May-99 $12,600 $10,931
Jul-99 $13,600 $10,333
Sep-99 $13,300 $10,366
Nov-99 $14,800 $11,807
The chart above assumes a $10,000 investment in the Fund from December 29, 1998
through November 30, 1999 and includes the impact of the maximum 5.75% front-end
sales charge and reinvestment of distributions. Performance of the Institutional
class will vary due to differing charges and expenses. Past performance is not a
guarantee of future results. The performance above includes the effect of
expense limitations, which have been in effect since the Fund's inception.
Without the limitations, performance would have been lower.
The maximum front-end sales charge for Class A shares is 5.75%. Shares may be
purchased at net asset value under certain circumstances. Class A shares have a
12b-1 fee that has been waived since inception. Voluntary expense caps have been
in effect. Returns would have been lower without the expense waivers.
International stocks involve greater risks than investing in U.S. stocks. Return
and share value will fluctuate so that shares, when redeemed, may be worth more
or less than the original cost.
Delaware Latin America Fund
Average Annual Returns Through November 30, 1999
- ------------------------------------- -----------------------------------
Lifetime
- ------------------------------------- -----------------------------------
Class A (Est. 12/29/98)
- ------------------------------------- -----------------------------------
Excluding Sales Charge 25.29%
Including Sales Charge 18.07%
- ------------------------------------- -----------------------------------
Institutional Class 25.29%
- ------------------------------------- -----------------------------------
<PAGE>
Delaware New Europe Fund
Growth of a $10,000 Investment
December 29, 1998 to November 30,1999
MSCI Europe Index
Delaware New Europe Fund Class A
New Europe Market
Fund Index Value
---------- -----
Dec-98 $10,000 $9,379
Jan-99 $ 9,900 $9,047
Mar-99 $ 9,800 $9,013
May-99 $ 9,600 $9,091
Jul-99 $ 9,800 $9,557
Sep-99 $ 9,900 $9,069
Nov-99 $10,500 $9,346
The chart above assumes a $10,000 investment in the Fund from December 29, 1998
through November 30, 1999 and includes the impact of the maximum 5.75% front-end
sales charge and reinvestment of distributions. Performance of the Institutional
class will vary due to differing charges and expenses. Past performance is not a
guarantee of future results. The performance above includes the effect of
expense limitations, which have been in effect since the Fund's inception.
Without the limitations, performance would have been lower.
The maximum front-end sales charge for Class A shares is 5.75%. Shares may be
purchased at net asset value under certain circumstances. Class A shares have a
12b-1 fee that has been waived since inception. Voluntary expense caps have been
in effect. Returns would have been lower without the expense waivers.
<PAGE>
International stocks involve greater risks than investing in U.S. stocks. Return
and share value will fluctuate so that shares, when redeemed, may be worth more
or less than the original cost.
Delaware New Europe Fund
Average Annual Returns Through November 30, 1999
- ------------------------------------- -----------------------------------
Lifetime
- ------------------------------------- -----------------------------------
Class A (Est. 12/29/98)
- ------------------------------------- -----------------------------------
Excluding Sales Charge -0.82%
Including Sales Charge -6.54%
- ------------------------------------- -----------------------------------
Institutional Class -0.47%
- ------------------------------------- -----------------------------------
<PAGE>
DELWARE GROUP GLOBAL & INTERNATIONAL FUNDS
DELAWARE GLOBAL OPPORTUNITIES FUND
STATEMENT OF NET ASSETS
NOVEMBER 30, 1999
Market
Number Value
of Shares (U.S.$)
----------- -----------
COMMON STOCK - 98.79%
Australia - 6.45%
Amcor ........................................... 10,110 $ 43,955
CSR ............................................. 19,460 46,715
Foster's Brewing Group .......................... 20,440 54,885
National Australia Bank ......................... 3,320 47,988
Orica ........................................... 4,400 22,907
---------
216,450
---------
Belgium - 1.96%
Electrabel ...................................... 206 65,812
---------
65,812
---------
France - 7.02%
Alcatel ......................................... 200 38,825
Compagnie de Saint Gobain ....................... 250 42,607
Societe Generale ................................ 268 57,837
Total Fina Class B .............................. 722 96,182
---------
235,451
---------
Germany - 9.86%
Bayer ........................................... 1,460 61,617
Bayerische Hypo-und Vereinsbank ................. 1,760 109,332
RWE ............................................. 1,180 44,981
Siemens ......................................... 1,150 115,044
---------
330,974
---------
Hong Kong - 3.19%
Hong Kong Electric .............................. 9,500 29,967
Jardine Matheson Holdings Limited ............... 6,800 30,192
Wharf Holdings .................................. 18,514 46,959
---------
107,118
---------
Japan - 3.60%
Canon ........................................... 1,000 29,461
Eisai ........................................... 1,000 22,194
Koito Manufacturing ............................. 5,000 23,569
Matsushita Electric ............................. 1,000 25,385
West Japan Railway .............................. 5 20,279
---------
120,888
---------
Malaysia - 1.05%
Sime Darby ...................................... 30,000 35,368
---------
35,368
---------
Netherlands - 4.69%
Elsevier ........................................ 4,700 46,355
ING Groep ....................................... 613 34,525
Royal Dutch Petroleum ........................... 1,300 76,601
---------
157,481
---------
Page 1
<PAGE>
DELAWARE GLOBAL OPPORTUNITIES FUND
STATEMENT OF NET ASSETS (Continued)
Market
Number Value
of Shares (U.S.$)
----------- -----------
COMMON STOCK (Continued)
New Zealand - 2.86%
Carter Holt Harvey .............................. 20,160 $ 24,472
Telecom Corporation of New Zealand .............. 16,690 71,337
---------
95,809
---------
South Africa - 1.40%
Sanlam .......................................... 23,300 27,268
Sasol ........................................... 2,600 19,717
----------
46,985
----------
Spain - 3.44%
Iberdrola ....................................... 2,420 33,776
Telefonica ...................................... 3,920 81,748
----------
115,524
----------
United Kingdom - 18.79%
Associated British Foods ........................ 3,960 19,539
Bass ............................................ 4,705 52,977
Blue Circle Industries .......................... 10,251 59,147
Boots ........................................... 6,000 61,225
Cable & Wireless ................................ 7,880 100,637
GKN ............................................. 7,140 112,199
Glaxo Wellcome .................................. 3,660 109,934
PowerGen ........................................ 7,000 60,793
Taylor Woodrow .................................. 22,500 54,160
----------
630,611
----------
United States - 34.48%
Aon ............................................. 1,500 53,531
A T & T ......................................... 1,200 67,050
Atlantic Richfield .............................. 600 57,825
Avon Products ................................... 1,500 54,656
Bank of America ................................. 905 52,942
Baxter International ............................ 900 60,806
Block (H&R) ..................................... 1,200 51,600
Federal National Mortgage ....................... 800 53,300
Ford Motor ...................................... 1,100 55,550
GTE ............................................. 800 58,400
Heinz (H.J.) .................................... 1,100 46,063
Intel ........................................... 800 61,300
International Business Machines ................. 600 61,837
International Paper ............................. 1,040 54,256
McGraw-Hill ..................................... 1,000 56,688
Minnesota Mining & Manufacturing ................ 600 57,337
Pharmacia & Upjohn .............................. 1,000 54,688
Pitney Bowes .................................... 900 43,144
Summit Bancorp .................................. 1,500 48,938
U.S. Bancorp .................................... 1,600 54,700
USX-Marathon Group .............................. 2,000 52,875
----------
1,157,486
----------
Total Common Stock (cost $3,289,099) ............ 3,315,957
----------
Page 2
<PAGE>
DELAWARE GLOBAL OPPORTUNITIES FUND
STATEMENT OF NET ASSETS (Continued)
<TABLE>
<CAPTION>
Market
Principal Value
Amount (U.S.$)
--------------- ---------------
<S> <C> <C>
REPURCHASE AGREEMENTS - 1.46%
With Chase Manhattan 5.64% 12/01/99
(dated 11/30/99, collateralized by $7,000
U.S. Treasury Notes 5.50% due 02/28/03,
market value $7,019 and $12,000 U.S. Treasury
Notes 7.875% due 11/15/04, market value $12,641) ......................... $ 19,200 $ 19,200
With J.P. Morgan 5.63% 12/01/99
(dated 11/30/99, collateralized by $7,000
U.S. Treasury Notes 6.25% due 02/15/03,
market value $7,221 and $8,000 U.S. Treasury
Notes 5.50% due 03/31/03, market value $8,011) ........................... 14,900 14,900
With PaineWebber 5.63% 12/01/99
(dated 11/30/99, collateralized by $15,000
U.S. Treasury Notes 5.50% due 01/31/03,
market value $15,219) .................................................... 14,900 14,900
------------
Total Repurchase Agreements (cost $49,000) .................................... 49,000
------------
TOTAL MARKET VALUE OF SECURITIES - 100.25%
(cost $3,338,099) ........................................................... $3,364,957
LIABILITIES NET OF RECEIVABLES AND OTHER ASSETS - (0.25)% ..................... (8,364)
------------
NET ASSETS APPLICABLE TO 374,714 SHARES
($0.01 PAR VALUE) OUTSTANDING - 100.00% ....................................... $3,356,593
============
NET ASSET VALUE - DELAWARE GLOBAL OPPORTUNITIES FUND A CLASS
($11,761 / 1,313 shares) .................................................... $ 8.96
============
NET ASSET VALUE - DELAWARE GLOBAL OPPORTUNITIES FUND INSTITUTIONAL CLASS
($3,344,832 / 373,401 shares) ............................................... $ 8.96
============
COMPONENTS OF NET ASSETS AT NOVEMBER 30, 1999:
Common stock, $0.01 par value, 200,000,000 shares
authorized to the Fund with 100,000,000 shares
allocated to Delaware Global Opportunities Fund A Class,
25,000,000 shares allocated to Delaware Global
Opportunities Fund B Class, 25,000,000 shares allocated
to Delaware Global Opportunities Fund C Class and
50,000,000 shares allocated to Delaware Global
Opportunities Fund Institutional Class ..................................... $3,186,639
Undistributed net investment income ** ........................................ 69,670
Accumulated net realized gain on investments .................................. 73,935
Net unrealized appreciation of investments and foreign currencies ............. 26,349
------------
Total net assets .............................................................. $3,356,593
============
</TABLE>
- --------------------------------------------------------------------------------
* Non-income producing security for the year ended November 30, 1999.
** 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.
Page 3
<PAGE>
DELAWARE GLOBAL OPPORTUNITIES FUND
STATEMENT OF NET ASSETS (Continued)
<TABLE>
<CAPTION>
<S> <C>
NET ASSET VALUE AND OFFERING PRICE PER SHARE -
DELAWARE GLOBAL OPPORTUNITIES FUND
Net asset value A Class (A) ............................................................. $ 8.96
Sales charge ( 5.75% of offering price or 6.14% of the amount invested per share) (B) ... 0.55
------
Offering price .......................................................................... $ 9.51
======
</TABLE>
- --------------------------------------------------------------------------------
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon redemption or repurchase of shares.
(B) See the current prospectus for purchases of $50,000 or more.
See accompanying notes
Page 4
<PAGE>
DELWARE GROUP GLOBAL & INTERNATIONAL FUNDS
DELAWARE INTERNATIONAL SMALL CAP FUND
STATEMENT OF NET ASSETS
NOVEMBER 30, 1999
Market
Number Value
of Shares (U.S. $)
------------ ----------
COMMON STOCK - 95.58%
Australia - 1.31%
Simeon Wines ................................... 23,600 $ 51,093
----------
51,093
----------
Canada - 1.85%
Laidlaw ........................................ 4,800 29,175
* Magellan Aerospace ............................. 8,000 42,920
----------
72,095
----------
Denmark - 1.80%
Bang & Olufsen Holding Class B ................. 2,133 70,238
----------
70,238
----------
Finland - 1.06%
Huhtamaki Van Leer Oyj ......................... 600 18,273
Talentum ....................................... 1,200 22,993
----------
41,266
----------
France - 9.85%
Boiron ......................................... 600 39,330
Carbone Lorraine ............................... 700 25,801
Financiere Marc de Lacharriere ................. 300 33,279
IMV Technologies ............................... 1,600 32,432
Manitou ........................................ 1,000 50,423
Mecatherm ...................................... 1,150 41,866
Norbert Dentressangle .......................... 1,560 34,453
* Remy Cointreau ................................. 1,810 36,506
Royal Canin .................................... 700 47,932
Walter ......................................... 430 42,062
----------
384,084
----------
Germany - 8.43%
AGIV ........................................... 2,420 45,026
* Babcock Borsig ................................. 850 33,002
Boewe Systec ................................... 1,870 41,525
Cewe Color Holding ............................. 2,500 56,725
Escada ......................................... 450 54,003
FAG Kugelfischer Georg Schaefer ................ 4,950 35,342
KSB ............................................ 350 34,060
Ludwig Beck .................................... 2,242 28,940
----------
328,623
----------
China - 8.48%
ASM Pacific Technology ......................... 64,000 102,589
Cafe De Coral Holdings ......................... 110,000 43,196
Chen Hsong Holdings ............................ 280,000 91,027
Hung Hing Printing Group ....................... 104,000 40,840
South China Morning Post (Holdings) ............ 64,000 53,149
----------
330,801
----------
Page 5
<PAGE>
DELAWARE INTERNATIONAL SMALL CAP FUND
STATEMENT OF NET ASSETS (Continued)
Market
Number Value
of Shares (U.S. $)
--------- ----------
COMMON STOCK (Continued)
Italy - 1.78%
Carraro ........................................... 8,000 $ 29,285
La Doria .......................................... 15,000 40,237
-----------
69,522
-----------
Japan - 18.02%
Arcland Sakamoto .................................. 4,000 70,706
Aronkasei ......................................... 15,000 58,185
Daitec ............................................ 3,000 61,573
Getz Brothers ..................................... 10,000 54,503
Kayaba Industry ................................... 29,000 61,799
Miyachi Technos ................................... 5,000 61,868
Nagawa ............................................ 8,000 72,277
Takara Printing ................................... 6,000 126,093
Ube-Nitto Kasei ................................... 14,000 65,442
Zuiko ............................................. 3,000 70,117
-----------
702,563
-----------
Malaysia - 1.47%
Kumpulan Guthrie .................................. 54,000 28,989
* Leader Universal Holdings ......................... 93,000 28,390
----------
57,379
----------
Netherlands - 7.17%
Draka Holding ..................................... 1,000 38,724
Endemol Entertainment ............................. 1,300 56,569
ICT Automatisering ................................ 1,500 46,137
Koninklijke Ahrend ................................ 2,000 21,177
Stork ............................................. 2,100 29,331
Unique International .............................. 1,500 34,716
Van Melle ......................................... 1,000 53,145
-----------
279,799
-----------
New Zealand - 0.98%
The Warehouse Group ............................... 9,600 38,193
-----------
38,193
-----------
Norway - 1.56%
* Nera .............................................. 19,400 60,658
-----------
60,658
-----------
Singapore - 3.25%
Asia Pacific Breweries ............................ 13,000 33,718
Courts (Singapore) Limited ........................ 65,000 31,321
DBS Land .......................................... 7,000 13,658
Overseas Union Bank ............................... 10,392 48,221
-----------
126,918
-----------
Spain - 0.76%
Portland Valderrivas .............................. 1,200 29,564
-----------
29,564
-----------
Page 6
<PAGE>
DELAWARE INTERNATIONAL SMALL CAP FUND
STATEMENT OF NET ASSETS (Continued)
<TABLE>
<CAPTION>
Market
Number Value
of Shares (U.S. $)
----------- ---------
<S> <C> <C>
COMMON STOCK (Continued)
Sweden - 3.33%
Celsius AB .............................................................................. 4,500 $ 92,058
IRO ..................................................................................... 3,700 37,846
-----------
129,904
-----------
Switzerland - 2.52%
Lindt & Spruengli Class B .............................................................. 4 98,187
-----------
98,187
-----------
Taiwan - 0.08%
Yageo GDR ............................................................................... 616 2,926
-----------
2,926
-----------
United Kingdom - 21.88%
Arriva .................................................................................. 10,580 51,950
Body Shop International ................................................................. 30,000 64,056
Bovis Homes Group ....................................................................... 10,700 50,742
Bradstock Group ......................................................................... 66,800 30,449
Bristol Water Holdings .................................................................. 2,550 52,816
Dairy Crest Group ....................................................................... 11,000 39,673
Fuller Smith & Turner ................................................................... 6,100 60,733
Glynwed International ................................................................... 14,400 50,784
Harvey Nichols .......................................................................... 15,800 52,184
Hewden Stuart ........................................................................... 27,000 50,309
IMI ..................................................................................... 13,400 55,080
Laird Group ............................................................................. 11,800 46,899
Northern Foods .......................................................................... 27,000 44,048
Persimmon ............................................................................... 14,100 56,266
Rexam ................................................................................... 11,600 46,104
TT Group ................................................................................ 24,200 45,285
Wilshaw ................................................................................. 70,800 56,053
-----------
853,431
-----------
Total Common Stock (cost $3,595,660) .................................................... 3,727,244
-----------
Principal
Amount
-----------
REPURCHASE AGREEMENTS - 4.95%
With Chase Manhattan 5.64% 12/01/99
(dated 11/30/99, collateralized by $28,000
U.S. Treasury Notes 5.50% due 02/28/03,
market value $27,644 and $46,000 U.S. Treasury
Notes 7.875% due 11/15/04, market value $49,790) ................................... $75,500 75,500
With J.P. Morgan 5.63% 12/01/99
(dated 11/30/99, collateralized by $28,000
U.S. Treasury Notes 6.25% due 02/15/03,
market value $28,441 and $32,000 U.S. Treasury
Notes 5.50% due 03/31/03, market value $31,554) .................................... 58,800 58,800
With PaineWebber 5.63% 12/01/99
(dated 11/30/99, collateralized by $60,000
U.S. Treasury Notes 5.50% due 01/31/03,
market value $59,943) .............................................................. 58,700 58,700
-----------
Total Repurchase Agreements (cost $193,000) ............................................. 193,000
-----------
</TABLE>
Page 7
<PAGE>
DELAWARE INTERNATIONAL SMALL CAP FUND
STATEMENT OF NET ASSETS (Continued)
<TABLE>
<S> <C>
TOTAL MARKET VALUE OF SECURITIES - 100.53%
(cost $3,788,660) ....................................................................... $ 3,920,244
LIABILITIES NET OF RECEIVABLES AND OTHER ASSETS - (0.53%) ............................... (20,489)
------------
NET ASSETS APPLICABLE TO 363,348 SHARES
($0.01 PAR VALUE) OUTSTANDING - 100.00% ................................................. $ 3,899,755
============
NET ASSETS VALUE- DELAWARE INTERNATIONAL SMALL CAP FUND A CLASS
($10.73 / 1 share) ...................................................................... $ 10.73
============
NET ASSETS VALUE- DELAWARE INTERNATIONAL SMALL CAP FUND INSTITUTIONAL CLASS
($3,899,744 / 363,347 shares) ........................................................... $ 10.73
============
COMPONENTS OF NET ASSETS AT NOVEMBER 30, 1999:
Common stock, $0.01 par value, 150,000,000 shares
authorized to the Fund with 50,000,000 shares
allocated to Delaware International Small Cap Fund A Class,
25,000,000 shares allocated to Delaware International Small
Cap Fund B Class, 25,000,000 shares allocated to Delaware
International Small Cap Fund C Class and 50,000,000
shares allocated to Delaware International Small Cap
Fund Institutional Class ............................................................. $ 3,089,853
Undistributed net investment income** ................................................... 49,003
Accumulated net realized gain on investments ............................................ 629,501
Net unrealized appreciation of investments and foreign currencies ....................... 131,398
------------
Total net assets ........................................................................ $ 3,899,755
============
- ------------
* Non-income producing security for the year ended November 30, 1999.
** 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.
GDR - Global Depository Receipt
NET ASSET VALUE AND OFFERING PRICE PER SHARE -
DELAWARE INTERNATIONAL SMALL CAP FUND
Net asset value A Class (A) ............................................................. $ 10.73
Sales charge (5.75% of offering price or 6.06% of the amount invested
per share)(B) ...................................................................... 0.65
------------
Offering price .......................................................................... $ 11.38
============
</TABLE>
- ---------------------
(A) Net asset value per share, as illustrated, is the estimated amount
which would be paid upon redemption or repurchase of shares.
(B) See the current prospectus for purchases of $50,000 or more.
See accompanying notes
<PAGE>
DELWARE GROUP GLOBAL & INTERNATIONAL FUNDS
DELAWARE LATIN AMERICA FUND
STATEMENT OF NET ASSETS
NOVEMBER 30, 1999
<TABLE>
<CAPTION>
Market
Number of Value
Shares (U.S. $)
-------------------------------------
<S> <C> <C>
COMMON STOCK - 79.49%
Argentina - 6.81%
Central Puerto Class B ........................................................ 21,300 $36,855
Central Costanera ADR ......................................................... 2,100 49,357
S.A. Importadora y Exportadora de la Patagonia ................................ 6,700 62,319
Sociedad Comercial del Plata .................................................. 74,600 23,801
Transportadora de Gas del Sur Class B ........................................ 24,700 41,008
------------------
213,340
------------------
Brazil - 32.34%
Aracruz Celulose ADR .......................................................... 6,700 136,513
Centrais Electricas GDR ...................................................... 2,200 90,473
Companhia Energetica de Minas Gerais ADR ...................................... 5,000 92,920
Companhia Paranaense de Energia Copel ADR ..................................... 14,300 109,931
Rossi Residential GDR ......................................................... 32,600 39,880
Telecomunicacoes Brasileiras ADR .............................................. 1,300 26
Telecomunicacoes de Minas Gerais .............................................. 2,600,000 79,771
Telecomunicacoes do Parana .................................................... 400,000 99,220
Unibanco GDR .................................................................. 6,800 160,225
Usinas Siderurgicas de Minas Gerais ADR ....................................... 48,300 204,666
------------------
1,013,625
------------------
Canada - 2.86%
*Bell Canada International ..................................................... 5,100 89,531
------------------
89,531
------------------
Chile - 8.22%
*A.F.P. Provida ADR ........................................................... 5,300 108,981
Cia de Telecom Chile ADR ..................................................... 3,500 64,313
Quinenco ADR .................................................................. 9,500 84,313
------------------
257,607
------------------
Luxembourg - 1.93%
Quilmes Industrial ADR ........................................................ 5,200 60,450
-----------------
60,450
------------------
Mexico - 23.72%
*Acer Computec Latino America .................................................. 108,500 35,802
Alfa Class A .................................................................. 18,700 80,554
Cemex Class B ................................................................. 29,000 141,538
Grupo Financiero Banorte ...................................................... 57,700 82,035
Grupo Industrial Maseca Class B ............................................... 61,200 29,025
Grupo Industrial Saltillo ..................................................... 19,000 59,873
*Grupo Minsa C Shares .......................................................... 125,000 61,273
Nacional De Drogas ............................................................ 66,000 73,528
Tubos de Acero de Mexico ...................................................... 7,500 94,297
Vitro ADR ..................................................................... 16,700 85,588
------------------
743,513
------------------
</TABLE>
Page 9
<PAGE>
DELAWARE LATIN AMERICA FUND
STATEMENT OF NET ASSETS (Continued)
<TABLE>
<CAPTION>
Market
Number of Value
Shares (U.S. $)
-------------------------------------
<S> <C> <C>
COMMON STOCK (Continued)
Peru - 3.60%
Creditcorp ..................................................................... 5,900 63,794
Telefonica del Peru ADR ........................................................ 3,800 49,163
------------------
112,957
------------------
Total Common Stock (cost $2,072,905) ........................................... 2,491,023
------------------
PREFERRED STOCK - 7.28%
Brazil - 7.28%
Gerdau Metalurgica ............................................................. 2,900,000 110,088
Telecomunicacoes Brasileiras ADR Preferred ..................................... 1,300 117,975
------------------
228,063
------------------
Total Preferred Stock (cost $172,850) .......................................... 228,063
------------------
Principal
Amount
-----------------
REPURCHASE AGREEMENTS - 14.07%
With Chase Manhattan 5.64% 12/01/99
(dated 11/30/99, collateralized by $63,000
U.S. Treasury Notes 5.50% due 02/28/03,
market value $63,167 and $106,000 U.S. Treasury
Notes 7.875% due 11/15/04, market value $113,769) ......................... $173,000 173,000
With J.P. Morgan Securities 5.63% 12/01/99
(dated 11/30/99, collateralized by $73,000
U.S. Treasury Notes 5.50% due 03/31/03,
market value $72,101 and $64,000 U.S. Treasury
Notes 6.25% due 02/15/03, market value $64,987) ........................... 134,000 134,000
With PaineWebber 5.63% 12/01/99
(dated 11/30/99, collateralized by $137,000
U.S.Treasury Notes 5.50% due 01/31/03, market
value $136,969) ........................................................... 134,000 134,000
------------------
Total Repurchase Agreements (cost $441,000) .................................... 441,000
------------------
TOTAL MARKET VALUE OF SECURITIES - 100.84%
(cost $2,686,755) .............................................................. $3,160,086
LIABILITIES NET OF RECEIVABLES AND OTHER ASSETS - (0.84%) ...................... (26,183)
------------------
NET ASSETS APPLICABLE TO 294,227 SHARES ($0.01 par value)
OUTSTANDING - 100.00% .......................................................... $3,133,903
==================
NET ASSET VALUE - DELAWARE LATIN AMERICA FUND A CLASS
($1,153.60 / 108.3 shares) ................................................... $ 10.65
==================
NET ASSET VALUE - DELAWARE LATIN AMERICA FUND INSTITUTIONAL CLASS
($3,132,749 / 294,119 shares) ................................................ $ 10.65
==================
</TABLE>
Page 10
<PAGE>
<TABLE>
<S> <C>
DELAWARE LATIN AMERICA FUND
STATEMENT OF NET ASSETS (Continued)
COMPONENTS OF NET ASSETS AT NOVEMBER 30, 1999:
Common stock, $0.01 par value, 150,000,000 shares
authorized to the Fund with 50,000,000 shares
allocated to Delaware Latin America Fund A Class,
25,000,000 shares allocated to Delaware Latin America
Fund B Class, 25,000,000 shares allocated
to Delaware Latin America Fund C Class and
50,000,000 shares allocated to Delaware
Latin America Fund Institutional Class ........................................................... $2,501,149
Undistributed net investment income** .............................................................. 60,098
Accumulated net realized gain on investments ....................................................... 99,500
Net unrealized appreciation on investments and foreign currencies .................................. 473,156
------------------
Total net assets ................................................................................... $3,133,903
==================
</TABLE>
------------------------------------------------------------------------------
* Non-income producing security for the period ended November 30, 1999.
**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
<TABLE>
<S> <C>
NET ASSET VALUE AND OFFERING PRICE PER SHARE -
DELAWARE LATIN AMERICA FUND
Net asset value A Class (A) ........................................................................ $ 10.65
Sales charge (5.75% of offering price or 6.10% of the amount invested
per share)(B) ................................................................................. 0.65
------------------
Offering price ..................................................................................... $ 11.30
==================
</TABLE>
------------------------------------------------------------------------------
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon redemption or repurchase of shares.
(B) See the current prospectus for purchases of $50,000 or more.
See accompanying notes
<PAGE>
DELWARE GROUP GLOBAL & INTERNATIONAL FUNDS
DELAWARE NEW EUROPE FUND
STATEMENT OF NET ASSETS
NOVEMBER 30, 1999
Market
Number Value
of Shares (U.S. $)
------------ ----------
COMMON STOCK - 98.41%
Belgium - 1.93%
Electrabel .............................. 150 $47,922
--------
47,922
--------
Croatia - 1.71%
Pliva d.d. GDR .......................... 3,500 42,525
--------
42,525
--------
Czech Republic - 2.92%
*Ceske Radiokomunikace GDR ............... 1,200 36,420
*SPT Telecom GDR ......................... 2,500 36,250
--------
72,670
--------
France - 14.86%
Alcatel ................................. 570 110,652
Compagnie de Saint Gobain ............... 510 86,918
Societe Generale ........................ 340 73,375
Total Fina Class B ...................... 741 98,713
--------
369,658
--------
Germany - 12.02%
Bayer ................................... 1,730 73,012
Bayerische Hypo-und Vereinsbank ......... 1,290 80,136
RWE ..................................... 1,280 48,793
Siemens ................................. 970 97,037
--------
298,978
--------
Hungary - 5.61%
Demasz GDR .............................. 2,300 33,925
Magyar Tavkozlesi ADR ................... 2,000 60,375
MOL Magyar Olaj-es Gazipari GDR ......... 2,340 45,162
--------
139,462
--------
Italy - 3.07%
*Enel .................................... 4,927 21,812
ENI ..................................... 9,950 54,586
--------
76,398
--------
Netherlands - 7.01%
Elsevier ................................ 5,030 49,609
ING Groep ............................... 572 32,216
Royal Dutch Petroleum ................... 1,570 92,510
--------
174,335
--------
Poland - 1.00%
Prokom Software GDR ..................... 2,000 24,800
--------
24,800
--------
Portugal - 3.03%
Portugal Telecom ........................ 7,820 75,312
--------
75,312
--------
Spain - 10.28%
Banco Santander Central Hispanoamericano 7,308 80,404
Iberdrola ............................... 5,250 73,274
*Telefonica .............................. 4,899 102,169
--------
255,847
--------
Sweden - 2.96%
Svenska Cellulosa ...................... 2,654 73,796
--------
73,796
Page 12
<PAGE>
DELAWARE NEW EUROPE FUND
STATEMENT OF NET ASSETS (Continued)
<TABLE>
<CAPTION>
Market
Number Value
of Shares (U.S. $)
------------------ -----------------
<S> <C> <C>
COMMON STOCK (Continued)
Switzerland - 1.75%
Novartis ...................................................................... 28 $ 43,688
-----------
43,688
-----------
United Kingdom - 30.26%
Associated British Foods ...................................................... 6,864 33,868
Bass .......................................................................... 5,900 66,433
BG ............................................................................ 11,500 60,697
Blue Circle Industries ........................................................ 9,400 54,237
Boots ......................................................................... 4,300 43,878
British Airways ............................................................... 11,000 65,975
Cable & Wireless .............................................................. 6,000 76,627
GKN ........................................................................... 3,100 48,714
Glaxo Wellcome ................................................................ 1,800 54,066
Great Universal Stores ........................................................ 4,998 33,734
PowerGen ...................................................................... 7,000 60,793
Rio Tinto ..................................................................... 6,130 120,495
Unigate ....................................................................... 6,900 33,190
-----------
752,707
-----------
Total Common Stock (cost $2,547,024) .......................................... 2,448,098
-----------
Principal
Amount
------------------
REPURCHASE AGREEMENTS - 2.49%
With Chase Manhattan 5.64% 12/01/99 (dated 11/30/99,
collateralized by $8,900 U.S. Treasury Notes 5.50%
due 02/28/03, market value $8,881 and
$14,900 U.S. Treasury Notes 7.875% due 11/15/04,
market value $15,995) ...................................................... $24,300 24,300
With J.P. Morgan Securities 5.63% 12/01/99 (dated 11/30/99, collateralized
by $10,200 U.S. Treasury Notes 5.50% due 03/31/03, market
value $10,137 and $8,900 U.S. Treasury Notes 6.25% due
02/15/03, market value $9,137) ............................................. 18,900 18,900
With PaineWebber 5.63% 12/01/99 (dated 11/30/99,
collateralized by $19,200 U.S. Treasury Notes 5.50%
due 01/31/03, market value $19,256) ........................................ 18,800 18,800
------------
Total Repurchase Agreements (cost $62,000) .................................... 62,000
------------
TOTAL MARKET VALUE OF SECURITIES - 100.90%
(cost $2,609,024) ............................................................. $2,510,098
LIABILITIES NET OF RECEIVABLES AND OTHER ASSETS - (0.90%) ..................... (22,486)
------------
NET ASSETS APPLICABLE TO 294,143 SHARES
($0.01 PAR VALUE) OUTSTANDING - 100.00% ....................................... $2,487,612
============
NET ASSET VALUE - DELAWARE NEW EUROPE FUND A CLASS
($202.56 / 24.04 shares) ................................................... $8.43
============
NET ASSET VALUE - DELAWARE NEW EUROPE FUND INSTITUTIONAL CLASS
($2,487,409 / 294,119 shares) .............................................. $8.46
============
</TABLE>
Page 13
<PAGE>
DELAWARE NEW EUROPE FUND
STATEMENT OF NET ASSETS (Continued)
<TABLE>
<CAPTION>
<S> <C>
COMPONENTS OF NET ASSETS AT NOVEMBER 30, 1999:
Common stock, $0.01 par value, 150,000,000 shares
authorized to the Fund with 50,000,000 shares
allocated to Delaware New Europe Fund A Class,
25,000,000 shares allocated to Delaware New Europe
Fund B Class, 25,000,000 shares allocated
to Delaware New Europe Fund C Class and
50,000,000 shares allocated to Delaware New
Europe Fund Institutional Class ...................................... $2,500,163
Undistributed net investment income ** .................................. 49,156
Accumulated net realized gain on investments ............................ 37,418
Net unrealized depreciation of investments and foreign currencies ....... (99,125)
------------
Total net assets ........................................................ $2,487,612
============
</TABLE>
- --------------------------------------------------------------------------------
* Non-income producing security for the period ended November 30, 1999.
** 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
<TABLE>
<CAPTION>
<S> <C>
NET ASSET VALUE AND OFFERING PRICE PER SHARE -
DELAWARE NEW EUROPE FUND
Net asset value A Class (A) $8.43
Sales charge (5.75% of offering price or 6.05% of the amount invested per share) (B) 0.51
-----
Offering price $8.94
=====
</TABLE>
- --------------------------------------------------------------------------------
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon redemption or repurchase of shares.
(B) See the current prospectus for purchases of $50,000 or more.
Page 14
<PAGE>
DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Delaware Delaware Delaware
Delaware International Latin America New Europe
Global Opportunities Small Cap Fund Fund
Fund Fund 12/29/98* 12/29/98*
Year Ended Year Ended to to
11/30/1999 11/30/1999 11/30/1999 11/30/1999
-------------------- ------------- ------------- -----------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest ..................................................... $ 4,501 $ 11,051 $ 20,747 $ 5,554
Dividends .................................................... 94,743 102,866 74,813 66,221
Foreign tax withheld ......................................... (6,778) (8,339) (4,095) (6,963)
------- -------- -------- --------
92,466 105,578 91,465 64,812
------- -------- -------- --------
EXPENSES:
Management fees .............................................. 28,138 44,574 31,635 28,241
Custodian fees ............................................... 1,400 2,350 288 1,000
Registration fees ............................................ 1,478 300 313 2,764
Professional fees ............................................ 2,355 1,337 4,924 4,096
Accounting and administration ................................ 1,593 1,413 1,004 1,430
Reports and statements to shareholders ....................... 2,567 2,757 843 3,379
Dividend disbursing and transfer agent fees and expenses ..... 2,387 1,412 1,053 2,590
Trustees' fees ............................................... 1,105 602 353 460
Taxes (other than taxes on income) ........................... 1,100 189 99 1,248
Distribution expense ......................................... 40 - 2 1
Other ........................................................ 1,598 1,170 652 1,080
------- -------- -------- --------
43,761 56,104 41,166 46,289
Less expenses absorbed or waived ............................. (16,582) (11,264) (9,481) (17,792)
Less expenses paid indirectly ................................ (138) (82) (72) (377)
------- -------- -------- --------
Total expenses ............................................... 27,041 44,758 31,613 28,120
------- -------- -------- --------
NET INVESTMENT INCOME ........................................ 65,425 60,820 59,852 36,692
------- -------- -------- --------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN CURRENCIES:
Net realized gain (loss) on:
Investments ............................................... 73,891 629,358 99,500 37,418
Foreign currencies ........................................ 13,982 (10,773) 246 12,464
------- -------- -------- --------
Net realized gain 87,873 618,585 99,746 49,882
Net change in unrealized appreciation /
depreciation of investments and foreign currencies .......... (61,130) 45,562 473,156 (99,125)
------- -------- -------- --------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN CURRENCIES ..................... 26,743 664,147 572,902 (49,243)
------- -------- -------- --------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM OPERATIONS ........................................... $92,168 $724,967 $632,754 $(12,551)
======= ======== ======== ========
</TABLE>
*Date of commencement of operations.
See accompanying notes
Page 15
<PAGE>
DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Delaware Global Delaware International
Opportunities Fund Small Cap Fund
12/19/97*
Year ended Year ended to
11/30/1999 11/30/1998 11/30/1999 11/30/1998
------------------------- --------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income ............................................ $ 65,425 $ 75,359 $ 60,820 $ 66,625
Net realized gain on investments and foreign currencies .......... 87,873 67,582 618,585 22,475
Net change in unrealized appreciation / depreciation of
investments and foreign currencies ............................. (61,130) 207,851 45,562 85,836
---------- ---------- ---------- ----------
Net increase (decrease) in net assets resulting from operations .. 92,168 350,792 724,967 174,936
---------- ---------- ---------- ----------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income:
A Class ...................................................... (300) (57) - -
Institutional Class .......................................... (76,912) (38,823) (63,530) -
Net realized gain on investments:
A Class ...................................................... (233) - - -
Institutional Class .......................................... (59,741) - (26,471) -
---------- ---------- ---------- ----------
(137,186) (38,880) (90,001) -
---------- ---------- ---------- ----------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold:
A Class ...................................................... 390 7,781 - 5,661
Institutional Class .......................................... 299 - - 3,000,009
Net asset value of shares issued upon reinvestment
of distributions from net investment income and net
realized gain on investments:
A Class ...................................................... 398 57 - -
Institutional Class .......................................... 136,653 38,823 90,001 -
---------- ---------- ---------- ----------
137,740 46,661 90,001 3,005,670
---------- ---------- ---------- ----------
Cost of shares repurchased:
A Class ....................................................... (1,563) (2,516) - (5,818)
Institutional Class ........................................... - - - -
---------- ---------- ---------- ----------
(1,563) (2,516) - (5,818)
---------- ---------- ---------- ----------
Increase in net assets derived from capital
share transactions ............................................ 136,177 44,145 90,001 2,999,852
---------- ---------- ---------- ----------
NET INCREASE IN NET ASSETS ....................................... 91,159 356,057 724,967 3,174,788
NET ASSETS:
Beginning of period .............................................. 3,265,434 2,909,377 3,174,788 -
---------- ---------- ---------- ----------
End of period .................................................... $3,356,593 $3,265,434 $3,899,755 $3,174,788
========== ========== ========== ==========
</TABLE>
<PAGE>
STUB
<TABLE>
<CAPTION>
Delaware Latin America Fund Delaware New Europe Fund
12/29/98* 12/29/98*
To To
11/30/1999 11/30/1999
--------------------------- -------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income .............................................. $ 59,852 $ 36,692
Net realized gain on investments and foreign currencies ............ 99,746 49,882
Net change in unrealized appreciation / depreciation of
investments and foreign currencies ............................... 473,156 (99,125)
---------- ----------
Net increase (decrease) in net assets resulting from operations .... 632,754 (12,551)
---------- ----------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income:
A Class ........................................................ - -
Institutional Class ............................................ - -
Net realized gain on investments:
A Class ........................................................ - -
Institutional Class ............................................ - -
---------- ----------
- -
---------- ----------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold:
A Class ........................................................ 2,421 2,275
Institutional Class ............................................ 2,500,008 2,501,683
Net asset value of shares issued upon reinvestment
of distributions from net investment income and net
realized gain on investments:
A Class ........................................................ - -
Institutional Class ............................................ - -
---------- ----------
2,502,429 2,503,958
---------- ----------
Cost of shares repurchased:
A Class ......................................................... (1,280) (2,139)
Institutional Class ............................................. - (1,656)
---------- ----------
(1,280) (3,795)
---------- ----------
Increase in net assets derived from capital
share transactions .............................................. 2,501,149 2,500,163
---------- ----------
NET INCREASE IN NET ASSETS ......................................... 3,133,903 2,487,612
NET ASSETS:
Beginning of period ................................................ - -
---------- ----------
End of period ...................................................... $3,133,903 $2,487,612
========== ==========
</TABLE>
_______________
*Date of commencement of operations.
See accompanying notes
Page 16
<PAGE>
DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS
FINANCIAL HIGHLIGHTS
Selected data for each share of the Fund outstanding throughout each period
were as follows:
<TABLE>
<CAPTION>
Delaware Global Opportunities Fund
A Class Institutional Class
------------------------------------- ------------------------
7/22/97 (1)
Year Ended To Year Ended
11/30/1999 11/30/1998 11/30/97 11/30/1999 11/30/1998
---------- ---------- -------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........................... $9.100 $8.230 $8.500 $9.090 $8.230
Income (loss) from investment operations:
Net investment income (2) ................................... 0.175 0.210 0.056 0.175 0.210
Net realized and unrealized gain (loss) on investments
and foreign currencies .................................... 0.067 0.770 (0.326) 0.077 0.760
------ ------ ------ ------ ------
Total from investment operations ........................... 0.242 0.980 (0.270) 0.252 0.970
------ ------ ------ ------ ------
Less dividends and distributions:
Dividends from net investment income ........................ (0.215) (0.110) - (0.215) (0.110)
Distributions from net realized gain on investments ......... (0.167) - - (0.167) -
------ ------ ------ ------ ------
Total dividends ............................................. (0.382) (0.110) - (0.382) (0.110)
------ ------ ------ ------ ------
Net asset value, end of period ................................. $8.960 $9.100 $8.230 $8.960 $9.090
====== ====== ====== ====== ======
Total return (3) ............................................... 2.78% 12.07% (3.18%) 2.89% 11.95%
Ratios and supplemental data:
Net assets, end of period (000 omitted) .................... $12 $13 $6 $3,345 $3,253
Ratio of expenses to average net assets .................... 0.80% 0.80% 0.80% 0.80% 0.80%
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly ................... 1.59% 1.55% 2.16% 1.29% 1.25%
Ratio of net investment income to average net assets ....... 1.94% 2.40% 1.86% 1.94% 2.40%
Ratio of net investment income to average net assets prior
to expense limitation and expenses paid indirectly ........ 1.15% 1.65% 0.50% 1.45% 1.95%
Portfolio turnover ......................................... 27% 50% 25% 27% 50%
</TABLE>
<PAGE>
[RESTUBBED TABLE]
<TABLE>
<CAPTION>
Institutional Delaware International Small Cap Fund (4)
Class Institutional Class
------------ ---------------------------------
7/22/97 (1) Year 12/19/97 (1)
To Ended To
11/30/97 11/30/1999 11/30/1998
-------- ---------- ----------
<S> <C> <C> <C>
Net asset value, beginning of period ........................... $8.500 $9.000 $8.500
Income (loss) from investment operations:
Net investment income (2) ................................... 0.056 0.168 0.191
Net realized and unrealized gain (loss) on investments
and foreign currencies .................................... (0.326) 1.817 0.309
------ ------ ------
Total from investment operations ........................... (0.270) 1.985 0.500
------ ------ ------
Less dividends and distributions:
Dividends from net investment income ........................ - (0.180) -
Distributions from net realized gain on investments ......... - (0.075) -
------ ------ ------
Total dividends ............................................. - (0.255) -
------ ------ ------
Net asset value, end of period ................................. $8.230 $10.730 $9.000
====== ======= ======
Total return (3) ............................................... (3.18%) 22.74% 5.88%
Ratios and supplemental data:
Net assets, end of period (000 omitted) .................... $2,903 $3,900 $3,175
Ratio of expenses to average net assets .................... 0.80% 1.25% 1.25%
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly ................... 1.86% 1.57% 2.05%
Ratio of net investment income to average net assets ....... 1.86% 1.71% 2.25%
Ratio of net investment income to average net assets prior
to expense limitation and expenses paid indirectly ........ 0.80% 1.39% 1.45%
Portfolio turnover ......................................... 25% 96% 4%
</TABLE>
- ------------
(1) Date of commencement of operations; ratios have been annualized and total
return has not been annualized.
(2) Per share information was based on the average shares outstanding method.
(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) Shares of the Delaware International Small Cap Fund A Class were initially
offered on December 19, 1997. Between January 16, 1998 and July 15, 1998,
the A Class sold shares which were subsequently repurchased, leaving a
balance of one share, representing the initial seed purchase, as of November
30, 1999. This shareholder data is not being disclosed because the data is
not believed to be meaningful.
See accompanying notes
Page 17
<PAGE>
DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS
FINANCIAL HIGHLIGHTS
Selected data for each share of the Fund outstanding throughout each period
were as follows:
<TABLE>
<CAPTION>
Delaware Latin America Fund
A Class Institutional Class
------------ -------------------
12/29/98 (1) 12/29/98 (1)
To To
11/30/1999 11/30/1999
------------ -----------
<S> <C> <C>
Net asset value, beginning of period ............................. $8.500 $8.500
Income (loss) from investment operations:
Net investment income (2) ..................................... 0.204 0.204
Net realized and unrealized gain (loss) on investments and
foreign currencies ......................................... 1.946 1.946
------- -------
Total from investment operations ............................. 2.150 2.150
------- -------
Less dividends and distributions:
Dividends from net investment income .......................... - -
Distributions from net realized gain on investments ........... - -
------- -------
Total dividends ............................................... - -
------- -------
Net asset value, end of period ................................... $10.650 $10.650
======= =======
Total return (3) ................................................. 25.29% 25.29%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ...................... $1 $3,133
Ratio of expenses to average net assets ...................... 1.25% 1.25%
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly ..................... 1.92% 1.62%
Ratio of net investment income to average net assets ......... 2.36% 2.36%
Ratio of net investment income to average net assets prior
to expense limitation and expenses paid indirectly .......... 1.69% 1.99%
Portfolio turnover ........................................... 10% 10%
</TABLE>
<PAGE>
[RESTUBBED TABLE]
<TABLE>
<CAPTION>
Delaware New Europe Fund
A Class Institutional Class
----------- -------------------
12/29/98 (1) 12/29/98 (1)
To To
11/30/1999 11/30/1999
------------ ------------
<S> <C> <C>
Net asset value, beginning of period ............................. $8.500 $8.500
Income (loss) from investment operations:
Net investment income (2) ..................................... 0.125 0.125
Net realized and unrealized gain (loss) on investments and
foreign currencies ......................................... (0.195) (0.165)
------- -------
Total from investment operations ............................. (0.070) (0.040)
------- -------
Less dividends and distributions:
Dividends from net investment income .......................... - -
Distributions from net realized gain on investments ........... - -
------- -------
Total dividends ............................................... - -
------- -------
Net asset value, end of period ................................... $8.430 $8.460
======= =======
Total return (3) ................................................. (0.82%) (0.47%)
Ratios and supplemental data:
Net assets, end of period (000 omitted) ...................... $0.2 $2,487
Ratio of expenses to average net assets ...................... 1.26% 1.26%
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly ..................... 2.34% 2.04%
Ratio of net investment income to average net assets ......... 1.61% 1.61%
Ratio of net investment income to average net assets prior
to expense limitation and expenses paid indirectly .......... 0.53% 0.83%
Portfolio turnover ........................................... 7% 7%
</TABLE>
- -----------------
(1) Date of commencement of operations; ratios have been annualized and total
return has not been annualized.
(2) Per share information was based on the average shares outstanding method.
(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 18
<PAGE>
DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS
NOTES TO FINANCIAL STATEMENTS
NOVEMBER 30, 1999
Delaware Group Global & International Funds (the "Company") is organized as a
Delaware Business Trust and offers eight funds: the Delaware International
Equity Fund, the Delaware Global Equity Fund, the Delaware Global Bond Fund, the
Delaware Emerging Markets Fund, the Delaware Global Opportunities Fund, the
Delaware International Small Cap Fund, the Delaware Latin America Fund and the
Delaware New Europe Fund. These financial statements and related notes pertain
to the Delaware Global Opportunities Fund, the Delaware International Small Cap
Fund, the Delaware Latin America Fund and the Delaware New Europe Fund
(individually a "Fund" and collectively the "Funds"). The Funds are registered
as diversified open-end investment companies under the Investment Company Act of
1940, as amended. Each Fund offers four classes of shares. The A Class carries a
front-end sales charge of 5.75%, the B Class carries a back-end contingent
deferred sales charge, the C Class carries a level load sales charge and the
Institutional Class has no sales charge. As of November 30, 1999, only the A and
Institutional Classes have commenced operations.
The investment objective of each Fund is as follows:
Delaware Global Opportunities Fund: To seek long-term growth without undue risk
to principal by investing primarily in U.S. and foreign equity securities with
the potential for capital appreciation and income.
Delaware International Small Cap Fund: To seek long-term capital appreciation by
investing primarily in equity securities of small non-U.S. companies which may
include companies located or operating in established or emerging countries.
Delaware Latin America Fund: To seek long-term capital appreciation by
investing primarily in equity securities of Latin American companies.
Delaware New Europe Fund: To seek long-term capital appreciation by investing
primarily in equity securities of European companies.
1. Significant Accounting Policies
The following accounting policies are in accordance with generally accepted
accounting principles and are consistently followed by the Funds.
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 Fund is valued. Money market
instruments having less than 60 days to maturity are
Page 19
<PAGE>
DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS
NOTES TO FINANCIAL STATEMENTS (Continued)
1. Significant Accounting Policies (Continued)
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 Company's
Board of Trustees.
Federal Income Taxes- Each Fund intends to qualify or 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 Fund on
the basis of daily net assets of each class. Distribution expenses relating to a
specific class are charged directly to that class.
Repurchase Agreements- Each Fund 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
Fund's 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 current 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
Funds report certain foreign currency related transactions as components of
realized gains 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
Page 20
<PAGE>
DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS
NOTES TO FINANCIAL STATEMENTS (Continued)
1. Significant Accounting Policies (Continued)
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 Funds are aware
of such dividends, net of all non-rebatable tax withholdings. Withholding taxes
on foreign dividends have been provided for in accordance with the Funds'
understanding of the applicable country's tax rules and rates. Each Fund
declares and pays dividends from net investment income and capital gains, if
any, annually.
Certain expenses of the Funds are paid through "soft dollar" arrangements with
brokers. These transactions are done subject to best execution. Each Fund may
receive earnings credits from its custodian when positive cash balances are
maintained which are used to offset custody fees. The expenses paid under the
above agreement are included in their respective expense captions on the
Statement of Operations with the corresponding offset shown as "expenses paid
indirectly". The amount of these expenses and credits for the period ended
November 30, 1999 are as follows:
<TABLE>
<CAPTION>
Delaware Delaware
Global International Delaware Delaware
Opportunities Small Cap Latin America New Europe
Fund Fund Fund Fund
--------------------- -------------------- --------------------- --------------------
<S> <C> <C> <C> <C>
"Soft Dollar"
Expenses $78 $82 $59 $52
Earnings Credit 60 - 13 325
</TABLE>
2. Investment Management and Other Transactions with Affiliates
In accordance with the terms of the Investment Management Agreement, each Fund
pays Delaware International Advisers Ltd. ("DIAL"), the investment manager of
each Fund, an annual fee which is based on its average daily net assets.
Page 21
<PAGE>
DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS
NOTES TO FINANCIAL STATEMENTS (Continued)
2. Investment Management and Other Transactions with Affiliates (Continued)
The following are the management fees as a percentage of average daily net
assets for each Fund:
<TABLE>
<CAPTION>
Delaware Delaware
Global International Delaware Delaware
Opportunities Small Cap Latin America New Europe
Fund Fund Fund Fund
--------------------- ------------------- --------------------- -----------------
<S> <C> <C> <C> <C>
On the first $500 million 0.85% 1.25% 1.25% 1.25%
On the next $500 million 0.80% 1.20% 1.20% 1.20%
On the next $1.5 billion 0.75% 1.15% 1.15% 1.15%
In excess of $2.5 billion 0.70% 1.10% 1.10% 1.10%
</TABLE>
Prior to April 1, 1999 the management fee for the Delaware Global Opportunities
Fund and the Delaware International Small Cap Fund were 0.80% and 1.25% of
average daily net assets respectively.
DIAL has entered into a sub-advisory agreement with Delaware Management Company
("DMC"), an affiliate, with respect to the management of the Delaware Global
Opportunities Fund's investments in U.S. securities. DMC receives 50% of the
management fee paid to DIAL for managing the U.S. securities portion of the
Delaware Global Opportunities Fund.
DIAL has elected to waive its fees and reimburse each Fund to the extent that
annual operating expenses, exclusive of taxes, interest, brokerage commission,
extraordinary expenses and distribution fees, exceed 0.80% for each class of the
Delaware Global Opportunities Fund and 1.25% of the average daily net assets for
each class of the Delaware International Small Cap Fund, Delaware Latin America
Fund and Delaware New Europe Fund through January 31, 2001.
The Funds have engaged Delaware Service Company, Inc. ("DSC"), an affiliate of
DMC, to provide dividend disbursing, transfer agent and accounting services.
Each Fund pays DSC a monthly fee based in the number of shareholder accounts,
shareholder transactions and average net assets, subject to certain minimums.
Page 22
<PAGE>
DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS
NOTES TO FINANCIAL STATEMENTS (Continued)
2. Investment Management and Other Transactions with Affiliates (Continued)
On November 30, 1999, the Fund had liabilities payable to affiliates as follows:
<TABLE>
<CAPTION>
Delaware Delaware Delaware Delaware
Global International Latin New
Opportunities Small Cap America Europe
Fund Fund Fund Fund
------------------- ---------------- --------------- --------------
<S> <C> <C> <C> <C>
Investment management fee payable
to DIAL $930 $3,180 - $10,450
Dividend disbursing, transfer agent
fees, accounting fees and other
expenses payable to DSC - 550 $2,803 3,160
Other expenses payable to DMC and
affiliates - 152 3,722 9,495
</TABLE>
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. DDLP has elected voluntarily to
waive such fees.
Certain officers of DMC, DSC and DDLP are officers, trustees and/or employees of
the Funds. These officers, trustees and employees are paid no compensation by
the Funds.
3. Investments
During the period ended November 30, 1999, each Fund made purchases and sales of
investment securities other than U.S. government securities and temporary cash
investments as follows:
<TABLE>
<CAPTION>
Delaware Delaware Delaware Delaware
Global International Latin New
Opportunities Small Cap America Europe
Fund Fund Fund Fund
------------------- ---------------- --------------- --------------
<S> <C> <C> <C> <C>
Purchases $1,014,953 $3,150,323 $2,346,540 $2,648,303
Sales 888,891 3,246,554 200,285 138,696
</TABLE>
Page 23
<PAGE>
DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS
NOTES TO FINANCIAL STATEMENTS (Continued)
3. Investments (Continued)
At November 30, 1999, the aggregate cost of securities and unrealized
appreciation (depreciation) for federal income tax purposes for each Fund were
as follows:
<TABLE>
<CAPTION>
Delaware Delaware Delaware Delaware
Global International Latin New
Opportunities Small Cap America Europe
Fund Fund Fund Fund
------------------- ---------------- --------------- --------------
<S> <C> <C> <C> <C>
Cost of investments $3,338,099 $3,788,660 $2,686,755 $2,609,024
=================== ================= =============== ===============
Aggregate unrealized appreciation $421,423 $468,735 $653,870 $290,050
Aggregate unrealized depreciation (394,565) (337,151) (180,539) (388,976)
------------------- ----------------- --------------- ---------------
Net unrealized appreciation (depreciation) $26,858 $131,584 $473,331 $(98,926)
=================== ================= =============== ===============
</TABLE>
4. Capital Stock
Transactions in capital stock shares were as follows:
<TABLE>
<CAPTION>
Delaware Global Delaware International Delaware Latin Delaware New
Opportunities Fund Small Cap Fund America Fund Europe Fund
Year Year Year 12/19/97* 12/29/98* 12/29/98*
Ended Ended Ended to to to
11/30/99 11/30/98 11/30/99 11/30/98 11/30/99 11/30/99
----------- ----------- ------------ ------------ ----------------- -----------------
<S> <C> <C> <C> <C> <C> <C>
Shares sold:
A class 50 942 - 598 249 270
Institutional class - - - 352,942 294,119 294,319
Shares issued upon
reinvestment of
distributions from net
investment income and net
realized gain on
investments:
A class 45 - - - - -
Institutional class 15,671 4,787 10,405 - - -
----------- ----------- ------------ ------------ ----------------- -----------------
15,766 5,729 10,405 353,540 294,368 294,589
----------- ----------- ------------ ------------ ----------------- -----------------
Shares repurchased:
A class (176) (295) - (597) (141) (246)
Institutional class - - - - - (200)
----------- ----------- ------------ ------------ ----------------- -----------------
(176) (295) - (597) (141) (446)
----------- ----------- ------------ ------------ ----------------- -----------------
Net increase (decrease) 15,590 5,434 10,405 352,943 294,227 294,143
=========== =========== ============ ============ ================= =================
</TABLE>
* Date of commencement of operations.
Page 24
<PAGE>
DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS
NOTES TO FINANCIAL STATEMENTS (Continued)
5. Lines Of Credit
Each Fund has a committed line of credit for the following amounts:
Delaware Global Opportunities Fund $100,000
Delaware International Small Cap Fund $200,000
Delaware Latin America Fund $200,000
Delaware New Europe Fund $100,000
No amounts were outstanding at November 30, 1999, or at any time during the
fiscal year.
6. Foreign Exchange Contracts
A Fund will generally enter into forward foreign currency contracts as a way of
managing foreign exchange rate risk. A Fund 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 Fund 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 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 Fund could be exposed to risks if the
counterparties to the contracts are unable to meet the terms of their contracts.
The following forward currency contracts were outstanding at November 30, 1999:
Delaware International Small Cap Fund
<TABLE>
<CAPTION>
In Value of
Exchange Contract at Settlement Unrealized
Contracts to Deliver For 11/30/99 Date Appreciation
- ------------------------------------------ -------------- --------------- -------------- ------------------
<S> <C> <C> <C> <C>
4,193 European Monetary Units $4,220 $4,228 12/1/99 $8
</TABLE>
Page 25
<PAGE>
DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS
NOTES TO FINANCIAL STATEMENTS (Continued)
7. Market and Credit Risks
Some countries in which the Fund 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 deterioration in a
country's 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 Fund 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 Fund.
Each Fund may invest up to 15% 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 relative
illiquidity of some of these securities may adversely affect the Fund's ability
to dispose of such securities in a timely manner and at a fair price when it is
necessary to liquidate such securities.
8. Tax Information (Unaudited)
The information set forth is for the Funds' fiscal year as required by federal
laws. Shareholder's, however, must report distributions on a calendar year basis
for income tax purposes, which may include distributions for portions of two
fiscal years of a fund. Accordingly, the information needed by shareholders for
income tax purposes will be sent to them in early 2000. Please consult your tax
advisor for proper treatment of this information. For the fiscal year end
November 30, 1999, the Funds designate as long-term capital gains and ordinary
income distributions paid during the year as follows:
<TABLE>
<CAPTION>
(A) (B) (C)
Long-Term Capital Ordinary Income Total (D)
Gain Distributions Distributions Distributions Qualifying
(Tax Basis) (Tax Basis) (Tax Basis) Dividends(1)
---------------------- ----------------------- -------------- ----------------
<S> <C> <C> <C> <C>
Delaware Global Opportunities Fund 24% 76% 100% 87%
Delaware International Small Cap Fund - 100% 100% -
</TABLE>
(A) and (B) are based on the Fund's total distributions.
(D) is based on a percentage of ordinary income of the Fund.
(1) Qualifying dividends represent dividends which qualify for the corporate
dividends received deduction.
Page 26
<PAGE>
Report of Independent Auditors
To the Shareholders and Board of Trustees
Delaware Group Global & International Funds
We have audited the accompanying statements of net assets of Delaware Group
Global & International Funds (Delaware Global Opportunities Fund, Delaware
International Small Cap Fund, Delaware Latin America Fund, and Delaware New
Europe Fund) (the "Funds") as of November 30, 1999, and the related statements
of operations, statements of changes in net assets and 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, 1999, by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of each
of the above listed funds of Delaware Group Global & International Funds at
November 30, 1999, and the results of their operations, the changes in their net
assets and their financial highlights for each of the periods indicated therein,
in conformity with generally accepted accounting principles.
/s/ Ernst & Young LLP
---------------------
Ernst & Young LLP
Philadelphia, Pennsylvania
January 7, 2000
