<PAGE>
DELAWARE(SM)
INVESTMENTS
- ------------
Delaware International Equity Fund
Delaware Global Equity Fund
Delaware Emerging Markets Fund
Delaware Global Bond Fund
[International Diversification Artwork]
International
Diversification
1999 ANNUAL REPORT
<PAGE>
A TRADITION OF SOUND INVESTING SINCE 1929
- -----------------------------------------
TABLE OF CONTENTS
- -----------------
Letter to Shareholders 1
Delaware International
Equity Fund
Portfolio Management Review 3
Performance Summaries 5
Delaware Global Equity Fund
Portfolio Management Review 6
Performance Summaries 8
Delaware Emerging
Markets Fund
Portfolio Management Review 9
Performance Summaries 11
Delaware Global Bond Fund
Portfolio Management Review 12
Performance Summaries 14
Financial Statements
Statements of Net Assets 15
Financial Highlights 26
A Commitment To Our Investors
Experienced
o Our seasoned investment professionals average more than 15 years'
experience.
o For over 70 years, we have managed money in a variety of investment styles
that have weathered a full range of economic and market environments.
Disciplined
o We follow strict investment policies and clear buy/sell guidelines.
o We strive to balance risk and reward in order to provide relatively
conservative investment alternatives within any given asset class.
Consistent
o We believe consistent processes are the best way to seek consistent
investment performance.
o Our commitment to style consistency has earned us the confidence of
discriminating institutional and individual investors to manage
approximately $47 billion in assets as of December 31, 1999.
Comprehensive
o We offer more than 60 mutual funds in these asset classes.
o Large-cap equity o High-yield bonds
o Mid-cap equity o Investment grade bonds
o Small-cap equity o Municipal bonds (24 single-state funds)
o International equity o International fixed-income
o Balanced
o Our funds are available through financial advisers who can offer you
individualized attention and valuable investment advice.
Funds are not FDIC insured and are not guaranteed. It is possible to lose the
principal amount invested. (C)Delaware Distributors, L.P.
<PAGE>
Dear Shareholder
OVER THE LAST FISCAL
YEAR, INTERNATIONAL
INVESTORS FOUND CAUSE
FOR OPTIMISM AS
FINANCIAL TURBULENCE
AROUND THE WORLD
BEGAN TO STABILIZE.
[International Diversification Artwork]
December 7, 1999
Recap of Events -- Over the last fiscal year, international investors found
cause for optimism as financial turbulence around the world began to stabilize.
Around the globe, as in the United States, lower interest rates helped turn the
tide.
Last December, at the start of your 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 helped ease a credit crunch in world
markets, which enabled businesses to expand and operate more profitably and
reduced concerns about global economic stability.
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
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.
Performance Overview
For Periods Ended November 30, 1999
<TABLE>
<CAPTION>
Average Annual Total Returns at Net Asset Value One Year Lifetime
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
Delaware International Equity Fund Class A (Est. 10/31/91) +6.97% +9.54%
Lipper International Equity Fund Average +29.01% (604 funds) +11.39% (62 funds)
Morgan Stanley EAFE Index +21.43% +10.01%
- ----------------------------------------------------------------------------------------------------------
Delaware Global Equity Fund Class A (Est. 12/27/94) +3.17% +12.30%
Lipper Global Equity Fund Average +29.40% (245 funds) +16.96 (101 funds)
Morgan Stanley World Index +21.62% +18.73%
- ----------------------------------------------------------------------------------------------------------
Delaware Emerging Markets Fund Class A (Est. 6/10/96) +24.74% -3.71%
Lipper Emerging Markets Fund Average +42.36% (180 funds) -3.97% (4 funds)
Morgan Stanley Emerging Markets Free Index +45.49% -1.99%
- ----------------------------------------------------------------------------------------------------------
Delaware Global Bond Fund Class A (Est. 12/27/94) -3.50% +7.06%
Lipper Global Income Fund Average -2.17% (138 funds) +6.35% (82 funds)
Salomon Smith Barney World Government Bond Index -2.06% +6.59%
- ----------------------------------------------------------------------------------------------------------
</TABLE>
All performance is at net asset value and assumes reinvestment of distributions.
For complete performance for all Fund classes and expense information, see pages
5, 8, 11 and 14. Fee waivers were in effect during the periods cited above. All
indexes cited are unmanaged. The Morgan Stanley Capital International World
Index and Salomon Smith Barney World Government Bond Index include U.S. market
performance. All returns are stated in U.S. dollars. Past performance does not
guarantee future results. You cannot invest directly in an index.
1
<PAGE>
[International Diversification Artwork]
WE BELIEVE OUR DISCIPLINED
AND CONSISTENT APPROACH
TO INTERNATIONAL INVESTING
PROVIDES VALUABLE
PORTFOLIO DIVERSIFICATION
AND ATTRACTIVE WEALTH
BUILDING OPPORTUNITIES.
In spite of the brightening global economic landscape, "value" investments,
stocks or bonds, 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 U.S. During much of the 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 and their peers.
Delaware International Equity Fund delivered a positive return, +6.97%
(Class A shares at net asset value with distributions reinvested) for the one
year period ended November 30, 1999.
Delaware Global Equity Fund also provided a positive return of +3.17% for the
period (Class A shares at net asset value with distributions reinvested).
Delaware Emerging Markets Fund capitalized on a fortuitous environment and
provided a significant total return of +24.74% (Class A shares at net asset
value with distributions reinvested) for the one year ended November 30, 1999.
Delaware Global Bond Fund delivered a -3.50% return (Class A shares at net asset
value with distributions reinvested) for this performance period amid a strong
bias toward equity securities, domestically and overseas that dragged down
fixed-income returns.
Market Outlook -- We believe Delaware's global and international funds are
positioned to benefit if there is an increased interest in undervalued
investments in fiscal 2000. With many opportunities still ahead, we look forward
to working with you to make the most of your investments. Thank you for your
continued confidence in Delaware Investments.
Sincerely,
/s/ Wayne A. Stork /s/ David K. Downes
Wayne A. Stork David K. Downes
Chairman, President and Chief Executive Officer,
Delaware Investments Family of Funds Delaware Investments Family of Funds
2
<PAGE>
Delaware International Equity Fund
Clive A. Gillmore
Senior Portfolio Manager & Director
Delaware International Advisers Ltd.
Nigel G. May
Senior Portfolio Manager
Delaware International Advisers Ltd.
December 7, 1999
THE UNITED KINGDOM, IN
OUR OPINION, CURRENTLY
OFFERS ATTRACTIVE VALUE
AND WILL PROBABLY
REMAIN THE FUND'S
LARGEST POSITION.
[International Diversification Artwork]
PORTFOLIO MANAGEMENT REVIEW
- ---------------------------
The Fund's Results
Delaware International Equity Fund invests primarily in developed countries,
concentrating on Western Europe and select Pacific Rim nations that meet the
Fund's value standards. Value stocks are those that appear to be selling for
less than their true worth and have strong prospects for future growth.
We consider Delaware International Equity Fund to be a core international fund,
and therefore we strive to manage the risks involved with international
investing. We select stocks by comparing the inflation-adjusted value of a
stock's expected income with its current price. We supplement this approach with
company-specific research and extensive analysis to help identify factors that
may increase or decrease the value of stocks in specific countries. Amid a
brightening global economic landscape, your Fund provided a total return of
+6.97% for the one-year period ended November 30, 1999 (Class A shares at net
asset value with dividends reinvested).
Portfolio Highlights
Within Europe, we were cautious about the prospects for the euro and focused
on countries that did not participate in the European Monetary Union. The
United Kingdom remained the Fund's largest country allocation. We also invested
heavily in companies from Australia and New Zealand, which benefited from
growing investor interest in commodity-based stocks. Our investments in
Australia and New Zealand provided substantial gains for the Fund.
Since its inception, your Fund has historically kept its investments in Japanese
stocks smaller than the weighting of such stocks in the EAFE Index. We believed
that many Japanese stocks were overpriced. Over the last year,
faster-than-expected economic growth signaled an improving outlook for the
Japanese economy and helped generate stronger investment returns. This is the
primary reason for Delaware International Equity Fund's relative
underperformance. We could not keep pace with the EAFE Index and other
international funds that had more substantial Japanese allocations.
Nevertheless, we still view the Japanese market as overvalued and expect the
economic recovery in the country to be slow and difficult. The other key reason
for our underperformance was the preference for growth investment styles over
value investment styles in international markets. Since we employ a value
approach in your portfolio, your Fund lagged its benchmarks in performance.
3
<PAGE>
[International Diversification Artwork]
Delaware International Equity Fund's Asset Mix
November 30, 1999
Australia 10.6%
France 11.7%
Germany 11.2%
Japan 15.7%
[Graphic Omitted]
Netherlands 6.2%
Spain 7.9%
United Kingdom 25.7%
Other Assets & Cash 11.0%
Rising energy demand from recovering markets and the intervention of OPEC pushed
oil prices higher. This helped support higher prices for the Fund's holdings of
Total Fina, a French company that produces, refines and distributes oil.
Stronger global demand for commodities also benefited the Fund's holdings of
CSR, a diversified Australian company producing a wide range of products
including building materials and aluminum.
Outlook
In the coming months, Delaware International Equity Fund's country allocations
should remain relatively stable. The U.K., in our opinion, currently offers
attractive value and, for now, will probably remain the Fund's largest position.
During fiscal 1999, Japan's economy, the world's second largest, grew
considerably, reversing a trend of five consecutive quarters of recession
(Source: Bloomberg). Despite this encouraging news, we expect to hold our
Japanese position relatively steady, still substantially less than the EAFE
Index. In our view, the road to economic recovery in Japan will be bumpy. We
will continue to monitor the progress of Japanese economic recovery, while
searching for select companies that offer reasonably priced stocks.
Top Portfolio Holdings
November 30, 1999
<TABLE>
<CAPTION>
As a Percentage
Company Country Industry of Net Assets
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Siemens Germany Consumer Products 4.1%
- ----------------------------------------------------------------------------------------------------------
2. Telefonica Spain Utilities 4.1%
- ----------------------------------------------------------------------------------------------------------
3. Canon Japan Electronics 3.6%
- ---------------------------------------------------------------------------------------------------------
4. Alcatel France Telecommunications 3.4%
- ----------------------------------------------------------------------------------------------------------
5. Societe Generale France Banking, Finance & Insurance 3.2%
- ----------------------------------------------------------------------------------------------------------
6. GKN United Kingdom Automobile & Auto Parts 3.2%
- ----------------------------------------------------------------------------------------------------------
7. Cable & Wireless United Kingdom Telecommunications 3.1%
- ----------------------------------------------------------------------------------------------------------
8. Foster's Brewing Group Australia Food, Beverage & Tobacco 3.0%
- ----------------------------------------------------------------------------------------------------------
9. Matsushita Electric Japan Electronic & Electrical Equipment 3.0%
- ----------------------------------------------------------------------------------------------------------
10. Banco Santander Spain Banking, Finance & Insurance 2.9%
- ----------------------------------------------------------------------------------------------------------
</TABLE>
4
<PAGE>
FUND BASICS
- -----------
Fund Objective
To achieve long-term growth
without undue risk to principal.
Assets Under Management
$266.0 million
Number of Holdings
47
Fund Start Date
October 31, 1991
Your Fund Managers
Clive A. Gillmore is a graduate of the University of Warwick. Mr. Gillmore
joined Delaware in 1990 after serving in the investment-management field for
eight years. He previously was Senior Portfolio Manager at Hill Samuel
Investment Advisers Ltd.
Nigel G. May is a graduate of Sidney Sussex College, Cambridge. In 1991 he
joined Delaware, assuming portfolio management responsibilities and sharing
analytical responsibilities for continental Europe.
NASDAQ Symbols
Class A DEGIX
Class B DEIEX
Class C DEGCX
Fund Performance
Growth of a $10,000 Investment
October 31, 1991 - November 30, 1999
<TABLE>
<CAPTION>
Oct-91 Nov-92 Nov-93 Nov-94 Nov-95 Nov-96 Nov-97 Nov-98 Nov-99
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Lipper International Equity Fund Average
(62 funds) $10,000 $9,309 $12,392 $13,795 $13,897 $15,554 $17,381 $18,187 $22,299
Morgan Stanley EAFE Index $10,000 $8,794 $10,962 $12,622 $13,619 $15,265 $15,246 $17,804 $21,619
Delaware International Equity Fund A Class $ 9,425 $9,082 $11,178 $12,209 $13,207 $16,405 $16,941 $18,423 $19,706
</TABLE>
Chart assumes $10,000 invested on October 31, 1991 and includes the effect of a
5.75% front-end sales charge and reinvestment of all distributions. Performance
for other Fund classes will vary due to different charges and expenses. The
unmanaged Morgan Stanley Capital International Europe Australia Far East Index
holds stocks in Europe, Australia and the Far East. The Lipper International
Equity Fund Average is the average of international equity funds tracked by
Lipper Analytical Services. You cannot invest directly in an index.
Average Annual Returns
Through November 30, 1999
Lifetime Five Years One Year
- --------------------------------------------------------------------------------
Class A (Est. 10/31/91)
Excluding Sales Charge +9.54% +10.05% +6.97%
Including Sales Charge +8.75% +8.75% +0.78%
- --------------------------------------------------------------------------------
Class B (Est. 9/6/94)
Excluding Sales Charge +7.31% +9.30% +6.21%
Including Sales Charge +7.17% +9.02% +1.21%
- --------------------------------------------------------------------------------
Class C (Est. 11/29/95)
Excluding Sales Charge +9.64% - +6.22%
Including Sales Charge +9.64% - +5.22%
- --------------------------------------------------------------------------------
<PAGE>
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 their original cost. Class B and C
results excluding sales charge assume either that contingent sales charges did
not apply or the investment was not redeemed. Past performance is not a
guarantee of future results.
Class A shares have a 5.75% maximum front-end sales charge and a 12b-1 fee.
Class B shares do not have a front-end sales charge, but are subject to a 1%
annual distribution and service fee and a contingent 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 are available without sales or asset-based
distribution charges only to certain eligible institutional accounts.
Performance between 10/31/91 and 11/9/92 is based on Class A performance,
adjusted to eliminate the sales charge, but not the impact of 12b-1 fees that
were in effect.
<TABLE>
<CAPTION>
Average Annual Returns Through November 30, 1999 Lifetime Five Years One Year
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Institutional Class (Est. 10/31/91) +9.83% +10.38 +7.26%
NASDAQ Symbol Institutional Class: DEQIX
</TABLE>
5
<PAGE>
Delaware Global Equity Fund
Elizabeth A. Desmond
Senior Portfolio Manager & Director
Delaware International Advisers Ltd.
Robert L. Arnold
Senior Portfolio Manager
Delaware Management Company
December 7, 1999
DELAWARE GLOBAL
EQUITY FUND SCANS THE
WORLD FOR MARKETS, AND
COMPANIES THAT ARE
REASONABLY VALUED AND
OFFER STRONG PROSPECTS
FOR FUTURE GROWTH.
[International Diversification Artwork]
PORTFOLIO MANAGEMENT REVIEW
- ---------------------------
The Fund's Results
Using the same international value strategy as Delaware International Equity
Fund, Delaware Global Equity Fund scans the world for markets and companies that
are reasonably valued and offer strong prospects for future growth.
Complementing the Fund's international holdings, is a substantial portfolio of
U.S. stocks that also meet value criteria. Delaware Global Equity Fund provided
a positive return of +3.17% for the year ended November 30, 1999 (Class A shares
at net asset value with distributions reinvested).
Portfolio Highlights
Two of the strongest major markets since last December have been the United
States and Japan. We were not as heavily invested in these markets as our
benchmark, the Morgan Stanley World Index, and many other global funds because
we considered them overpriced. This strategy worked against us over the last
year and is the primary reason why the Fund did not keep pace with the returns
of our benchmark index and our peers.
We allocated a percentage of your Fund's portfolio to Europe, of which some
markets were decidedly lackluster. We attribute this, in part, to the weakness
of the new European currency, the euro. After a smooth start-up on January 4,
1999, the euro has steadily slipped in value against the U.S. dollar, reflecting
the sharp contrast between the pace of economic growth in the U.S. and in
Europe.
Due to the uncertain long-term outlook for the euro, we focused most of the
Fund's assets on countries that did not adopt the new currency. Our largest
foreign country allocation remained the U.K. We also invested in stocks from
Australia and New Zealand where the anticipation of stronger demand for
commodities helped drive attractive returns. The Asian markets performed well
over the past year, particularly Japan, Hong Kong and Singapore, where signs
that governments are implementing much needed reforms boosted investor
confidence.
6
<PAGE>
Delaware Global Equity Fund's Asset Mix
November 30, 1999
Australia 6.7%
France 7.2%
Germany 9.8%
Japan 4.3%
Netherlands 4.2%
United Kingdom 19.1%
[Graphic Omitted]
United States 33.9%
New Zealand 3.3%
Other Assets & Cash 11.5%
As of November 30, 1999, approximately 34% of Delaware Global Equity
Fund was invested in U.S. equities, significantly less than the Morgan Stanley
World Index, the Fund's benchmark. For the majority of fiscal 1999, very large
growth-oriented companies and technology companies dominated U.S. equity market
returns. We did not invest significantly in these types of companies because
they had high price-to-earnings ratios, an indication that they were probably
overvalued. P/E ratios are a commonly used measurement of a stock's value.
Delaware Global Equity Fund focuses on stocks that we believe are selling for
less than their true worth; therefore, these stocks were not appropriate for our
portfolio.
Outlook
For now, we will probably remain underweighted in Japan, relative to the Morgan
Stanley World Index. In our opinion, the majority of Japanese stock are too
expensive to meet Delaware Global Equity Fund's value discipline. Our U.S.
equity allocation will also probably remain below that of the index.
We are encouraged by positive economic news in Japan and many other parts of
Asia. We believe a stronger Japanese economy could further the recovery process
in many other parts of world and help counterbalance the impact of higher U.S.
interest rates.
Top Portfolio Holdings
November 30, 1999
<TABLE>
<CAPTION>
As a
Percentage
Company Country Industry of Net Assets
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Siemens Germany Consumer Products 3.4%
- ----------------------------------------------------------------------------------------------------------
2. Total Fina France Energy 3.1%
- ----------------------------------------------------------------------------------------------------------
3. Bayerische Hypo- und Vereinsbank Germany Banking, Finance & Insurance 2.7%
- ----------------------------------------------------------------------------------------------------------
4. Bayer Germany Chemicals 2.5%
- ----------------------------------------------------------------------------------------------------------
5. Telefonica Spain Utilities 2.5%
- ----------------------------------------------------------------------------------------------------------
6. Rio Tinto United Kingdom Metals & Mining 2.5%
- ----------------------------------------------------------------------------------------------------------
7. Telecom Corporation of New Zealand New Zealand Telecomunnications 2.4%
- ----------------------------------------------------------------------------------------------------------
8. Cable & Wireless United Kingdom Telecommunications 2.3%
- ----------------------------------------------------------------------------------------------------------
9. GKN United Kingdom Automobiles & Auto Parts 2.3%
- ----------------------------------------------------------------------------------------------------------
10. Royal Dutch Petroleum Netherlands Energy 2.3%
- ----------------------------------------------------------------------------------------------------------
</TABLE>
7
<PAGE>
[International Diversification Artwork]
Delaware Global Equity Fund
FUND BASICS
- -----------
Fund Objectives
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.
Assets Under Management
$16.3 million
Number of Holdings
65
Fund Start Date
December 27, 1994
Your Fund Managers
Elizabeth A. Desmond is a graduate of Wellesley College and the master's program
in East Asian Studies at Stanford University. She joined Delaware in 1991 and is
a Chartered Financial Analyst.
Robert L. Arnold holds a B.S. from Carnegie Mellon University and an M.B.A from
the University of Chicago. Prior to joining Delaware in 1992, he was involved in
strategic analysis assignments at Chemical Banking Corporation.
NASDAQ Symbols
Class A DEGAX
Class B DGABX
Class C DGACX
FUND PERFORMANCE
- ----------------
Growth of a $10,000 Investment
December 27, 1994 - November 30, 1999
<TABLE>
<CAPTION>
Dec-94 Nov-95 Nov-96 Nov-97 Nov-98 Nov-99
<S> <C> <C> <C> <C> <C> <C>
MSCI World Equity Index $10,000 $11,785 $14,052 $15,878 $19,122 $23,257
Lipper Global Equity Fund Average (101 funds) $10,000 $11,051 $12,825 $15,254 $17,617 $20,075
Delaware Global Equity Fund A Class $ 9,425 $11,460 $13,543 $14,884 $16,198 $16,712
</TABLE>
Chart assumes $10,000 invested on December 27, 1994 and includes the effect of a
5.75% front-end sales charge and reinvestment of all distributions. Performance
for other Fund classes will vary due to different charges and expenses. The
unmanaged Morgan Stanley Capital International World Index includes U.S. market
performance. The Lipper Global Equity Fund Average is the average of global
stock funds tracked by Lipper Analytical Services. You cannot invest directly in
an index.
Average Annual Returns
Through November 30, 1999
Lifetime One Year
- -----------------------------------------------------------------------
Class A (Est. 12/27/94)
Excluding Sales Charge +12.30% +3.17%
Including Sales Charge +10.96% -2.76%
- -----------------------------------------------------------------------
Class B (Est. 12/27/94)
Excluding Sales Charge +11.53% +2.56%
Including Sales Charge +11.26% -2.29%
- -----------------------------------------------------------------------
Class C (Est. 11/29/95)
Excluding Sales Charge +9.02% +2.57%
Including Sales Charge +9.02% +1.60%
- -----------------------------------------------------------------------
<PAGE>
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 their original cost. Class B and C
results excluding sales charge assume either that contingent sales charges did
not apply or the investment was not redeemed. Past performance is not a
guarantee of future results.
Class A shares have a 5.75% maximum front-end sales charge and a 12b-1 fee.
Class B shares do not have a front-end sales charge, but are subject to a 1%
annual distribution and service fee and a contingent 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 are available without sales or asset-based
distribution charges only to certain eligible institutional accounts.
Average Annual Returns Through November 30, 1999 Lifetime One Year
- --------------------------------------------------------------------------------
Institutional Class (Est. 12/27/94) +12.66% +3.63%
NASDAQ Symbol Institutional Class: DGAIX
8
<PAGE>
Delaware Emerging Markets Fund
Clive A. Gillmore
Senior Portfolio Manager & Director
Delaware International Advisers Ltd.
Robert Akester
Senior Portfolio Manager
Delaware International Advisers Ltd.
Joshua H. Brooks
Senior Portfolio Manager
Delaware International Advisers Ltd.
December 7, 1999
AS EMERGING NATIONS
CONTINUE TO WORK WITH
THE INTERNATIONAL
MONETARY FUND TO
IMPLEMENT MUCH-NEEDED
ECONOMIC REFORMS,
WE EXPECT LONG-TERM
BENEFITS FOR EMERGING
MARKET INVESTORS.
PORTFOLIO MANAGEMENT REVIEW
- ---------------------------
The Fund's Results
After weathering an extremely difficult year in 1998, emerging market investors
saw substantial improvement during 1999. Delaware Emerging Markets Fund returned
+24.74% for the year ended November 30, 1999 (Class A shares at net asset value
with distributions reinvested). Although the Fund performed well in absolute
terms, it fell short of both the Morgan Stanley Capital International Emerging
Markets Free Index, the Fund's benchmark, and a peer group of funds with similar
investment objectives. Just as our other global and international funds do,
Delaware Emerging Markets Fund follows a steadfast value discipline and has a
lower price-to-earnings ratio than the Morgan Stanley Index, which helps explain
your Fund's underperformance.
Portfolio Highlights
When selecting stocks, we not only look at companies, we also consider the
country of origin. Due to the higher degree of risk associated with
international investing, we maintained a portfolio of companies from numerous
emerging market countries as of November 30, 1999. We believe this broad
portfolio exposure helps to reduce long-term investment risk.
We continued to invest the largest percentage of Delaware Emerging Markets
Fund's assets in Brazil. In December 1998 and January of 1999, our substantial
allocation to Brazil had a negative impact on the Fund's performance. Brazil's
market, however, made remarkable progress throughout fiscal 1999 after the
devaluation of the nation's currency on January 21, 1999. For a country that
does not export heavily, the currency devaluation had little impact on trade.
However, it did slow the outflow of international capital, lead to lower
interest rates and improve investor confidence. After months of uneasiness about
Brazil's currency, investors were encouraged to see Brazil pull through the
devaluation in reasonably good shape.
[International Diversification Artwork]
9
<PAGE>
[International Diversification Artwork]
Delaware Emerging Markets Fund
Asset Mix
November 30, 1999
Brazil 19.4%
China 4.3%
Hungary 4.0%
India 9.6%
Malaysia 7.5%
Mexico 5.2%
[Graphic Omitted}
Turkey 3.3%
Thailand 4.2%
South Africa 11.4%
Other Assets & Cash 31.1%
Although South Korea's market performed well over the past fiscal year, we chose
to invest less heavily in this country than our benchmark, the Morgan Stanley
Capital International Emerging Markets Free Index. In some ways, we view
developments in the South Korean market as the reverse of what we have seen in
Brazil. For example, in Brazil, governmental reforms have been implemented
slowly and with much opposition. Nevertheless, many Brazilian businesses
restructured on their own, in order to operate more profitably. In contrast, the
South Korean government has promoted strong measures to turn their economy
around. However, we believe many companies in South Korea are still borrowing
excessively and expanding into unprofitable markets.
Outlook
It appears that many emerging market economies have begun to turn the corner. As
emerging nations continue to work with the International Monetary Fund to
implement much-needed economic reforms, we expect long-term benefits for
emerging market investors.
In the Pacific Rim, we will remain focused on companies with strong balance
sheets from countries where both governments and business are committed to
reforming excessive business practices of the past. We are encouraged by
positive economic news in Japan and many other parts of Asia. We believe a
stronger Japanese economy could further the recovery process in many other parts
of the world and help counterbalance the impact of highr U.S. interest rates.
We expect to continue to allocate a substantial portion of the Fund's assets to
Brazil where many companies still appear very inexpensive to us. Most of these
companies maintain healthy balance sheets and appear positioned for growth in
the coming year despite the prospects of modest GDP growth.
For investors with a long-term outlook and a tolerance for the special risks
associated with investing in emerging markets, we see greater-than-normal
opportunities to discover companies and countries that are temporarily out of
favor with the potential to rise in value to their true worth.
10
<PAGE>
Delaware Emerging Markets Fund
FUND BASICS
- -----------
Fund Objective
Seeks to achieve long-term capital appreciation.
Assets Under Management
$15.8 million
Number of Holdings
74
Fund Start Date
June 10, 1996
Your Fund Managers
Clive A. Gillmore is a graduate of the University of Warwick. Mr. Gillmore
joined Delaware in 1990 after serving in the investment-management field for
eight years. He previously was Senior Portfolio Manager at Hill Samuel
Investment Advisers Ltd.
Robert Akester is a graduate of University College, London. Mr. Akester joined
Delaware in 1996 and has more than 25 years of investment experience.
Joshua H. Brooks is a graduate of Yale University. He began his investment
career at Delaware in 1991 and was previously an equity market analyst.
NASDAQ Symbols
Class A DEMAX
Class B DEMBX
Class C DEMCX
FUND PERFORMANCE
- ----------------
Results of a $10,000 Investment
June 10, 1996 - November 30, 1999
<TABLE>
<CAPTION>
Jun-96 Nov-96 May-97 Nov-97 May-98 Nov-98 May-99 Nov-99
<S> <C> <C> <C> <C> <C> <C> <C> <C>
MSCI Emerging Markets Free Index $10,000 $9,538 $10,709 $8,272 $7,678 $6,418 $7,944 $9,337
Lipper Emerging Markets Fund
Average (106 funds) $10,000 $9,730 $10,704 $9,414 $10,010 $6,823 $8,225 $8,748
Delaware Emerging Markets Fund A Class $ 9,425 $9,353 $11,354 $9,651 $ 8,939 $6,595 $7,287 $8,227
</TABLE>
Chart assumes $10,000 invested on June 10, 1996 and includes the effect of a
5.75% front-end sales charge and reinvestment of all distributions. Performance
for other Fund classes will vary due to different charges and expenses. The
unmanaged Morgan Stanley Capital International Emerging Markets Free Index holds
stocks from the world's emerging market regions. The Lipper Emerging Markets
Fund Average is the average of all emerging markets equity funds tracked by
Lipper Analytical Services. You cannot invest directly in an index.
Average Annual Returns
Through November 30, 1999
Lifetime One Year
- --------------------------------------------------------------------------------
Class A (Est. 6/10/96)
Excluding Sales Charge -3.71% +24.74%
Including Sales Charge -5.33% +17.54%
- --------------------------------------------------------------------------------
Class B (Est. 6/10/96)
Excluding Sales Charge -4.37% +23.81%
Including Sales Charge -5.14% +18.81%
- --------------------------------------------------------------------------------
Class C (Est. 6/10/96)
Excluding Sales Charge -4.40% +23.85%
Including Sales Charge -4.40% +22.85%
- --------------------------------------------------------------------------------
<PAGE>
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 their original cost. Class B and C
results excluding sales charge assume either that contingent sales charges did
not apply or the investment was not redeemed. Past performance is not a
guarantee of future results.
Class A shares have a 5.75% maximum front-end sales charge and a 12b-1 fee.
Class B shares do not have a front-end sales charge, but are subject to a 1%
annual distribution and service fee and a contingent 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 are available without sales or asset-based
distribution charges only to certain eligible institutional accounts.
Average Annual Returns Through November 30, 1999 Lifetime One Year
Institutional Class (Est. 6/10/96) -3.37% +25.24%
NASDAQ Symbol Institutional Class: DEMIX
11
<PAGE>
Delaware Global Bond Fund
Christpher A. Moth
Senior Portfolio Manager
Delaware International Advisers Ltd.
Joanna Bates
Senior Portfolio Manager
Delaware International Advisers Ltd.
December 7, 1999
WE REMAIN CONFIDENT THAT A PORTFOLIO CONSISTING OF BOTH FOREIGN AND U.S. BONDS
HELPS REDUCE INVESTMENT RISK AND INCREASES YOUR OPPORTUNITIES FOR HIGH CURRENT
INCOME AND CAPITAL APPRECIATION.
Portfolio Management Review
- ---------------------------
The Fund's Results
Delaware Global Bond Fund and most similar funds faced a difficult environment
as global bond markets took second billing to global equities this past year.
Your Fund provided a disappointing total return of -3.50% for the one-year
period ended November 30, 1999 (Class A shares at net asset value with dividends
reinvested). Although your Fund's return was negative for this period, its
return was relatively comparable to the average return of a peer group of funds
with similar investment objectives, tracked by Lipper Analytical Services, Inc.
An improving global outlook and a robust U.S. economy reduced demand for U.S.
government debt over the last year, lowering prices and pushing yields higher.
The success of the stock market in the spring and summer did, however, heighten
inflationary concerns. The U.S. Federal Reserve Bank responded by raising
interest rates on June 30th, August 24th and November 16th. As of this writing,
the Federal Funds target rate on overnight loans between banks stands at 5.50%.
These three increases took back the last of three reductions made in the fall of
1998 and returned the rate to its level of 14 months ago. Long-term U.S.
Treasury yields increased to 6.29% as of November 30, 1999 from last December's
low of 5.09% (Source: Bloomberg).
In Europe, progress toward currency union over the past two years originally
helped bond performance in countries with historically weak currencies and
higher-than-average inflation like Italy and Spain. However, since the euro was
introduced in January 1999, the value of the new currency depreciated over 11.2%
as of November 30, 1999 (Source: Bloomberg).
Portfolio Highlights
We increased our exposure to the U.S. bond market over the year as yields rose
in the U.S. faster than in many other countries and began to offer more value.
However, this exposure remains substantially below the index weight, as we
believe there is yet better value elsewhere in the world. Additionally, over 5%
of the Fund's holdings are invested in U.S. Treasury Inflation Protection
Securities (TIPS), which offer a very high guaranteed real (above inflation)
yield.
[International Diversification Art]
12
<PAGE>
Delaware Global Bond Fund
Asset Mix
November 30, 1999
Canada 8.1%
Germany 9.8%
Italy 6.6%
Netherlands 7.3%
New Zealand 14.0%
South Africa 4.9%
[Graphic Omitted]
United States 12.8%
United Kingdom 4.5%
Sweden 4.3%
Spain 4.4%
Other Assets & Cash 23.3%
The Fund also held sizable investments in Canada and New Zealand. Prior to
November 1999, we viewed currencies in these countries as extremely undervalued
relative to the U.S. dollar. Delaware Global Bond Fund benefited over the past
fiscal year as currencies in Australia, Canada and New Zealand strengthened. We
have, however, begun to reduce our exposure in these countries in favor of the
better values we now believe to be available in Europe.
Investing in foreign bonds involves certain risks including fluctuating currency
values. American investors measure their results in U.S. dollars. International
currency changes can add or subtract from U.S. returns. We attempt to reduce
currency risk by holding bonds denominated in currencies that appear
undervalued.
In general, we look for bonds with an average effective maturity in the five to
ten-year range, a range we believe offers an attractive level of income relative
to the risk to principal from fluctuating interest rates.
Outlook
We expect to continue to limit the Fund's exposure to interest rate risk by
maintaining a relatively short average effective duration. We held the duration
of your Fund shorter than the Salomon Smith Barney World Government Bond Index
due to our belief that inflation could begin to increase in both the U.S. and
abroad. We plan to maintain a somewhat conservative position for Delaware Global
Bond Fund in the coming months, keeping duration shorter than the index in order
to preserve capital if yields rise and prices fall.
Foreign bond markets now represent more than half of the fixed income
opportunities worldwide, up from less than one third in 1989 (Source:
Bloomberg). We remain confident that a portfolio consisting of both U.S. bonds
and foreign bonds helps reduce investment risk and increase your opportunities
for high current income and capital appreciation.
13
<PAGE>
Delaware Global Bond Fund
[International Diversification Art]
Fund Basics
- -----------
Fund Objective
Seeks to achieve current income consistent with preservation of principal.
Assets Under Management
$17.9 million
Number of Holdings
40
Fund Start Date
December 27, 1994
Your Fund Managers
Christopher A. Moth graduated from the City University of London and joined
Delaware in 1992. He previously worked at the Guardian Royal Exchange, where he
was responsible for technical analysis, quantitative models, and projections.
Joanna Bates is a graduate of London University and joined Delaware in 1997.
Previously she was Associate Director, Fixed Interest at Hill Samuel Investment
Management.
NASDAQ Symbols
Class A DGBAX
Class B DGBBX
Class C DGBCX
Fund Performance
- ----------------
Growth of a $10,000 Investment
December 27, 1994 - November 30, 1999
<TABLE>
<CAPTION>
Dec. 94 Nov.95 Nov. 96 Nov. 97 Nov. 98 Nov. 99
<S> <C> <C> <C> <C> <C> <C>
Salomon Smith Barney World Government Bond Index $10,000 $11,780 $12,437 $12,404 $13,976 $13,688
Lipper Global Income Fund Average (82 funds) $10,000 $11,593 $12,761 $13,207 $13,556 $13,485
Delaware Global Bond Fund Class A $ 9,525 $11,314 $12,938 $13,097 $13,814 $13,332
</TABLE>
Chart assumes $10,000 invested on December 27, 1994. Fund performance includes
the effect of a 4.75% front-end sales charge and reinvestment of all
distributions. Performance for other Fund classes will vary due to different
charges and expenses. The unmanaged Salomon Smith Barney World Government Bond
Index includes U.S. market performance. The Lipper Global Income Fund Average is
the average of all global bond funds tracked by Lipper Analytical Services. You
cannot invest directly in an index.
Average Annual Returns
Through November 30, 1999
Lifetime One Year
- ---------------------------------------------------------------------------
Class A (Est. 12/27/94)
Excluding Sales Charge +7.06% -3.50%
Including Sale Charge +6.01% -8.12%
- ---------------------------------------------------------------------------
Class B (Est. 12/27/94)
Excluding Sales Charge +6.34% -4.01%
Including Sales Charge +6.02% -7.67%
- ---------------------------------------------------------------------------
Class C (Est. 11/29/95)
Excluding Sales Charge +3.34% -4.21%
Including Sales Charge +3.34% -5.12%
- ---------------------------------------------------------------------------
<PAGE>
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 their original cost. Class B and C
results excluding sales charge assume either that contingent sales charges did
not apply or the investment was not redeemed. Past performance is not a
guarantee of future results.
Class A shares have a 4.75% maximum front-end sales charge and a 12b-1 fee.
Class B shares do not have a front-end sales charge, but are subject to a 1%
annual distribution and service fee and a contingent deferred sales charge of up
to 4% 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 are available without sales or asset-based
distribution charges only to certain eligible institutional accounts.
Average Annual Returns Through November 30, 1999 Lifetime One Year
- --------------------------------------------------------------------------------
Institutional Class (Est. 12/27/94) +7.37% -3.31%
NASDAQ Symbol Institutional Class: DGBIX
14
<PAGE>
Statements of Net Assets
Delaware Group Global & International Funds --
DELAWARE INTERNATIONAL EQUITY FUND
Number Market
November 30, 1999 of Shares Value (US$)
- --------------------------------------------------------------------------------
Common Stock - 98.78%
Australia - 10.57%
+Amcor .............................................. 1,087,000 $4,725,981
CSR ................................................ 1,956,874 4,697,569
Foster's Brewing Group ............................. 2,995,165 8,042,541
National Australia Bank ............................ 528,518 7,639,318
Orica .............................................. 578,300 3,010,669
----------
28,116,078
----------
Belgium - 1.76%
Electrabel ......................................... 14,679 4,689,602
----------
4,689,602
----------
France - 11.72%
Alcatel ............................................ 46,531 9,032,906
+Compagnie de Saint Gobain .......................... 35,975 6,131,149
+Societe Generale ................................... 39,118 8,441,989
Total Fina Class B ................................. 56,791 7,565,484
----------
31,171,528
----------
Germany - 11.23%
Bayer .............................................. 143,090 6,038,918
Bayerische Hypo- und Vereinsbank ................... 77,800 4,832,976
Continental ........................................ 94,500 1,867,851
+RWE ................................................ 161,000 6,137,225
Siemens ............................................ 109,900 10,994,203
----------
29,871,173
----------
Hong Kong - 4.20%
Hong Kong Electric ................................. 1,168,000 3,684,353
Jardine Matheson Holdings .......................... 632,287 2,807,354
Wharf Holdings ..................................... 1,843,514 4,675,897
----------
11,167,604
----------
Japan - 15.74%
Canon .............................................. 329,000 9,692,626
Eisai .............................................. 263,000 5,836,984
Hitachi ............................................ 489,000 6,770,992
+Kinki Coca-cola Bottling ........................... 134,000 2,079,152
Koito Manufacturing ................................ 500,000 2,356,870
Matsushita Electric ................................ 310,000 7,869,489
West Japan Railway ................................. 1,789 7,255,790
----------
41,861,903
----------
<PAGE>
Number Market
of Shares Value (US$)
- --------------------------------------------------------------------------------
Common Stock (continued)
Malaysia - 0.68%
Oriental Holdings .................................. 320,000 $ 682,105
Sime Darby ......................................... 966,000 1,138,863
-----------
1,820,968
-----------
Netherlands - 6.23%
+Elsevier ........................................... 452,000 4,457,914
*Koninklijke Vopak .................................. 69,680 1,837,529
Royal Dutch Petroleum .............................. 110,280 6,498,109
+Unilever ........................................... 68,714 3,790,432
-----------
16,583,984
-----------
New Zealand - 3.03%
+Carter Holt Harvey ................................. 880,300 1,068,613
+Telecom Corporation of New Zealand ................. 1,638,920 7,005,103
-----------
8,073,716
-----------
Spain - 7.90%
Banco Santander Central Hispanoamericano ........... 709,132 7,802,005
Iberdrola .......................................... 169,000 2,358,724
*Telefonica ......................................... 520,439 10,853,616
-----------
21,014,345
-----------
United Kingdom - 25.72%
Bass ............................................... 533,607 6,008,295
BG ................................................. 981,000 5,177,738
Blue Circle Industries ............................. 1,145,254 6,607,927
Boots .............................................. 728,500 7,433,739
British Airways .................................... 1,161,570 6,966,806
Cable & Wireless ................................... 646,000 8,250,201
GKN ................................................ 532,800 8,372,475
Great Universal Stores ............................. 618,206 4,172,562
Rio Tinto .......................................... 304,700 5,989,374
Taylor Woodrow ..................................... 2,190,825 5,273,528
Unigate ............................................ 869,000 4,180,060
-----------
68,432,705
-----------
Total Common Stock (cost $212,799,772) 262,803,606
-----------
15
<PAGE>
Statements of Net Assets (Continued)
Principal Market
Delaware International Equity Fund Amount Value (US$)
- --------------------------------------------------------------------------------
Repurchase Agreements - 2.05%
With Chase Manhattan 5.64% 12/01/99
(dated 11/30/99, collateralized by $782,000
U.S. Treasury Notes 5.50% due 02/28/03,
market value $779,341 and $1,308,000
U.S. Treasury Notes 7.875% due 11/15/04,
market value $1,403,667) ......................... $2,129,000 $ 2,129,000
With J.P. Morgan 5.63% 12/01/99 (dated
11/30/99, collateralized by $897,000
U.S. Treasury Notes 5.50% due 03/31/03,
market value $889,571 and $784,000
U.S. Treasury Notes 6.25% due 02/15/03,
market value $801,805) ........................... 1,656,000 1,656,000
With PaineWebber 5.63% 12/01/99 (dated
11/30/99, collateralized by $1,687,000
U.S.Treasury Notes 5.50% due 01/31/03,
market value $1,689,904) ......................... 1,656,000 1,656,000
------------
Total Repurchase Agreements
(cost $5,441,000) ................................ 5,441,000
------------
Total Market Value of Securities - 100.83%
(cost $218,240,772) .......................................... $268,244,606
Liabilities Net of Receivables and Other
Assets - (0.83%) ............................................. (2,198,294)
------------
Net Assets Applicable to 16,468,687 Shares
($0.01 Par Value) Outstanding - 100.00% ...................... $266,046,312
------------
Net Asset Value - Delaware International
Equity Fund A Class
($99,670,789 / 6,170,708 shares) ............................. $16.15
------
Net Asset Value - Delaware International
Equity Fund B Class
($36,997,307 / 2,299,673 shares) ............................. $16.09
------
Net Asset Value - Delaware International
Equity Fund C Class
($14,369,153 / 893,968 shares) ............................... $16.07
------
Net Asset Value - Delaware International
Equity Fund Institutional Class
($115,009,063 / 7,104,338 shares) ............................ $16.19
------
<PAGE>
Components of Net Assets at November 30, 1999:
Common stock, $0.01 par value, 500,000,000
shares authorized to the Fund with 50,000,000
shares allocated to Delaware International
Equity Fund A Class, 25,000,000 shares
allocated to Delaware International Equity
Fund B Class, 25,000,000 shares allocated to
Delaware International Equity Fund C Class,
and 50,000,000 shares allocated to Delaware
International Equity Fund Institutional Class .............. $208,165,061
Undistributed net investment income** ......................... 3,158,564
Accumulated net realized gain on investments .................. 4,802,290
Net unrealized appreciation of investments
and foreign currencies ..................................... 49,920,397
------------
Total net assets .............................................. $266,046,312
------------
- ------------------------
*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.
+Security is partially or fully on loan.
Net Asset Value and Offering Price Per Share -
Delaware International Equity Fund
Net asset value A Class(A) ........................................ $16.15
Sales charge (5.75% of offering price or 6.13%
of the amount invested per share)(B) ........................... 0.99
------
Offering price .................................................... $17.14
------
(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 $50,000 or more.
See accompanying notes
16
<PAGE>
Statements of Net Assets
Delaware Group Global & International Funds --
DELAWARE GLOBAL EQUITY FUND
Number Market
November 30, 1999 of Shares Value (US$)
- --------------------------------------------------------------------------------
Common Stock - 99.56%
Australia - 6.75%
Amcor ................................................ 45,600 $ 198,256
CSR .................................................. 116,250 279,064
Foster's Brewing Group ............................... 92,839 249,289
National Australia Bank .............................. 17,488 252,775
Orica ................................................ 22,800 118,698
---------
1,098,082
---------
Belgium - 2.03%
Electrabel ........................................... 1,035 330,659
---------
330,659
---------
France - 7.17%
Compagnie de Saint Gobain ............................ 1,720 293,136
Societe Generale ..................................... 1,679 362,342
Total Fina Class B ................................... 3,838 511,284
---------
1,166,762
---------
Germany - 9.81%
Bayer ................................................ 9,700 409,375
Bayerische Hypo-und Vereinsbank ...................... 7,070 439,192
RWE .................................................. 5,050 192,503
Siemens .............................................. 5,550 555,212
---------
1,596,282
---------
Hong Kong - 3.23%
Hong Kong Electric ................................... 44,000 138,794
Jardine Matheson Holdings Limited .................... 45,427 201,696
Wharf Holdings ....................................... 73,028 185,229
---------
525,719
---------
Japan - 4.28%
Canon ................................................ 5,000 147,304
Eisai ................................................ 8,000 177,551
Koito Manufacturing .................................. 10,000 47,137
Matsushita Electric .................................. 8,000 203,084
West Japan Railway ................................... 30 121,673
---------
696,749
---------
<PAGE>
Number Market
of Shares Value (US$)
- --------------------------------------------------------------------------------
Common Stock (continued)
Malaysia - 1.05%
Sime Darby .......................................... 145,300 $ 171,301
---------
171,301
---------
Netherlands - 4.24%
Elsevier ............................................ 23,650 233,251
Royal Dutch Petroleum ............................... 6,240 367,684
*Koninklijke Vopak ................................... 3,370 88,873
---------
689,808
---------
New Zealand - 3.29%
Carter Holt Harvey .................................. 114,300 138,751
Telecom Corporation of New Zealand .................. 92,726 396,331
---------
535,082
---------
South Africa - 1.51%
Sanlam .............................................. 122,000 142,774
Sasol ............................................... 13,600 103,134
---------
245,908
---------
Spain - 3.24%
Iberdrola ........................................... 9,100 127,008
*Telefonica .......................................... 19,183 400,060
---------
527,068
---------
United Kingdom - 19.10%
Associated British Food ............................. 25,960 128,091
Bass ................................................ 22,392 252,129
Blue Circle Industries .............................. 53,056 306,124
Boots ............................................... 32,700 333,676
British Airways ..................................... 27,152 162,851
Cable & Wireless .................................... 29,400 375,474
GKN ................................................. 23,700 372,424
Glaxo Wellcome ...................................... 10,820 324,997
PowerGen ............................................ 25,900 224,935
Rio Tinto ........................................... 20,350 400,012
Taylor Woodrow ...................................... 94,700 227,952
---------
3,108,665
---------
17
<PAGE>
Statements of Net Assets (Continued)
Number Market
Delaware Global Equity Fund of Shares Value (US$)
- --------------------------------------------------------------------------------
Common Stock (continued)
United States - 33.86%
Aon ................................................. 7,200 $ 256,950
AT&T ................................................ 5,500 307,313
Atlantic Richfield .................................. 2,800 269,850
Avon Products ....................................... 6,800 247,775
Bank of America ..................................... 4,418 258,453
Baxter International ................................ 4,400 297,275
Block (H&R) ......................................... 5,700 245,100
Federal National Mortgage ........................... 3,900 259,838
Ford Motor .......................................... 5,000 252,500
GTE ................................................. 3,700 270,100
Heinz (H.J.) ........................................ 6,000 251,250
Intel ............................................... 3,000 229,875
International Business Machine ...................... 2,800 288,575
International Paper ................................. 5,495 286,770
McGraw-Hill ......................................... 4,700 266,431
Minnesota Mining & Manufacturing .................... 2,700 258,019
Pharmacia & Upjohn .................................. 4,700 257,031
Pitney Bowes ........................................ 4,400 210,925
Raytheon ............................................ 1,500 46,031
Summit Bancorp ...................................... 7,300 238,163
U.S. Bancorp ........................................ 7,800 266,663
USX-Marathon Group .................................. 9,300 245,869
----------
5,510,756
----------
Total Common Stock (cost $15,218,084) ............... 16,202,841
----------
Preferred Stock - 0.14%
United States - 0.14%
Sealed Air .......................................... 475 22,325
----------
Total Preferred Stock (cost $21,116) ................ 22,325
----------
Total Market Value of Securities
(cost $15,239,200) - 99.70% ................................... $16,225,166
Receivables and Other Assets
Net of Liabilities - 0.30% ................................. 48,627
-----------
Net Assets Applicable to 1,233,066 Shares
($0.01 Par Value) Outstanding - 100.00% .................... $16,273,793
-----------
<PAGE>
Net Asset Value - Delware Global Equity Fund
A Class ($7,386,230 / 558,873 shares) ...................... $13.22
------
Net Asset Value - Delaware Global Equity Fund
B Class ($5,044,190 / 382,413 shares) ...................... $13.19
------
Net Asset Value - Delaware Global Equity Fund
C Class ($2,614,382 / 199,003 shares) ...................... $13.14
------
Net Asset Value - Delaware Global Equity Fund
Institutional Class ($1,228,991 / 92,777 shares) ........... $13.25
------
Components of Net Assets at November 30, 1999:
Common stock, $0.01 par value, 500,000,000 shares
authorized to the fund with 50,000,000 shares
allocated to Delaware Global Equity Fund A Class,
25,000,000 shares allocated to Delaware Global
Equity Fund B Class, 25,000,000 shares allocated
to Delaware Global Equity Fund C Class, and
50,000,000 shares allocated to Delaware Global
Equity Fund Institutional Class shares ..................... $14,759,865
Undistributed net investment income** ......................... 34,777
Accumulated net realized gain on investments .................. 494,691
Net unrealized appreciation of investments and
foreign currencies ......................................... 984,460
-----------
Total net assets .............................................. $16,273,793
-----------
- -------------------
*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.
Net Asset Value and Offering Price Per Share -
Delaware Global Equity Fund
Net asset value A Class(A) .................................... $13.22
Sales charge (5.75% of offering price or 6.13% of
the amount invested per share)(B) .......................... 0.81
------
Offering price ................................................ $14.03
------
- --------------------
(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 currenct prospectus for purchase of $50,000 or more.
See accompanying notes
18
<PAGE>
Statements of Net Assets
Delaware Group Global & International Funds -- DELAWARE EMERGING MARKETS FUND
<TABLE>
<CAPTION>
Number Market
November 30, 1999 of Shares Value (US$)
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Common Stock - 87.70%
Argentina - 1.75%
Central Puerto Class B ............................... 80,000 $ 138,421
Transportadora de Gas del Sur Class B ................ 83,600 138,797
---------
277,218
---------
Brazil - 19.38%
Aracruz Celulose ADR ................................. 11,250 229,219
Brasmotor ............................................ 1,606,000 160,784
Centrais Electricas de Santa Catarina ................ 309,000 126,942
Centrais Electricas de Santa Catarina GDR ............ 1,000 41,124
Companhia Energetica de Minas Gerais ................. 3,300,000 61,264
Companhia Energetica de Minas
Gerais ADR ......................................... 9,239 171,698
Companhia Paranaense de Energia
Copel ADR .......................................... 36,000 276,750
Elevadores Atlas Schindler ........................... 18,000 205,928
Gerdau Metalurgica ................................... 11,710,000 444,529
Gerdau Metalurgica ................................... 277,018 7,995
Petroleo Brasileiro .................................. 1,800,000 363,651
Renner Participacoes ................................. 4,100,000 7,889
Rossi Residencial .................................... 24,800 30,338
Telecomunicacoes de Minas Gerias ..................... 9,300,000 285,335
Telecomunicacoes do Parana ........................... 1,000,000 248,050
Uniao de Bancos Brasileiros .......................... 12,900,000 247,871
Usinas Siderurgicas de Minas Gerais .................. 24,600 104,131
Usinas Siderurgicas de Minas Gerais ADR .............. 13,370 56,654
---------
3,070,152
---------
Chile - 2.61%
A. F. P. Provida ADR ................................. 14,000 287,875
Empresa Nacional Electricidad ADR .................... 9,343 124,963
---------
412,838
---------
China - 4.27%
First Tractor ........................................ 610,000 91,890
Guangdong Kelon Electric Holdings .................... 285,000 245,851
Guangshen Railway .................................... 1,490,000 170,737
Shenzhen Expressway .................................. 1,090,400 168,469
---------
676,947
---------
Croatia - 0.80%
Zagrebacka Banka GDR ................................. 13,740 127,439
---------
127,439
---------
Egypt - 0.80%
*Paints and Chemicals Industries GDR .................. 24,200 126,445
---------
126,445
---------
Estonia - 1.22%
AS Eesti Telekom GDR ................................. 3,932 69,596
*Eesti Uhispank GDR ................................... 30,044 123,932
---------
193,528
---------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Number Market
of Shares Value (US$)
- -------------------------------------------------------------------------------------
<S> <C> <C>
Common Stock (continued)
Hong Kong - 0.60%
Hengan International Group .......................... 346,000 $ 94,665
---------
94,665
---------
Hungary - 4.04%
Gedeon Richter GDR .................................. 5,100 262,650
Matav ............................................... 12,476 376,619
---------
639,269
---------
India - 9.64%
*Gas Authority of India .............................. 19,089 180,391
*ICICI ............................................... 4,234 47,103
*India Fund .......................................... 26,560 373,500
Larsen & Toubro GDR ................................. 8,800 198,000
Mahanagar Telephone Nigam GDR ....................... 13,220 117,328
Videsh Sanchar Nigam GDR ............................ 8,644 198,812
Videsh Sanchar Nigam GDR ............................ 17,916 412,068
---------
1,527,202
---------
Indonesia - 0.44%
*PT United Tractors .................................. 77,000 69,117
---------
69,117
---------
Israel - 2.85%
Bank Hapoalim ....................................... 110,500 291,546
ECI Telecom ......................................... 6,400 160,200
---------
451,746
---------
Malaysia - 7.55%
*Leader Universal Holdings ........................... 615,000 187,737
Petronas Dagangan ................................... 337,000 347,642
Public Finance ...................................... 105,000 109,974
Resorts World ....................................... 82,000 220,105
Sime Darby .......................................... 280,000 330,105
---------
1,195,563
---------
Mexico - 5.20%
Alfa Class A ........................................ 55,015 236,988
Cemex Class B ....................................... 60,000 292,838
*Grupo Minsa ADR ..................................... 13,000 53,625
*Grupo Minsa Class C ................................. 117,000 57,352
Vitro ADR ........................................... 35,800 183,475
---------
824,278
---------
Peru - 2.73%
Banco de Credito del Peru Class C ................... 132,825 108,467
Creditcorp .......................................... 11,825 127,858
Telefonica del Peru ADR ............................. 15,200 196,650
---------
432,975
---------
Russia - 1.49%
Gazprom ADR ......................................... 4,200 33,705
Gazprom ADR ......................................... 5,000 40,125
Lukoil ADR .......................................... 3,100 104,129
Mosenergo ADR ....................................... 19,800 57,816
---------
235,775
---------
</TABLE>
19
<PAGE>
Statements of Net Assets (Continued)
<TABLE>
<CAPTION>
Number Market
Delaware Emerging Markets Fund of Shares Value (US$)
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Common Stock (continued)
South Africa - 11.44%
ABSA Group ........................................... 49,838 $ 187,963
Edgars Consolidated Stores ........................... 10,620 118,611
Iscor ................................................ 109,300 360,913
Sanlam ............................................... 343,500 401,992
Sappi ................................................ 39,600 355,105
Sasol ................................................ 51,200 388,268
----------
1,812,852
----------
South Korea - 2.47%
Pohang Iron & Steel .................................. 2,860 391,335
----------
391,335
----------
Taiwan - 0.98%
Yageo GDR ............................................ 32,634 155,012
----------
155,012
----------
Thailand - 4.16%
*Bangkok Bank ......................................... 93,800 200,802
*Hana Microelectronics ................................ 78,000 319,959
Thai Reinsurance ..................................... 129,000 138,905
----------
659,666
----------
Turkey - 3.28%
Efes Sinai Yatirim Holdings ADR ...................... 89,808 74,092
*Efes Sinai Yatirim Holdings Class B .................. 8,261,890 74,944
Koc Holding .......................................... 2,908,200 370,447
----------
519,483
----------
Total Common Stock (cost $17,329,941) ................ 13,893,505
==========
Principal
Amount
---------
Repurchase Agreements - 13.49%
With Chase Manhattan 5.64% 12/01/99
(dated 11/30/99, collateralized by
$307,000 U.S. Treasury Notes 5.50% due
02/28/03, market value $306,093 and
$514,000 U.S. Treasury Notes 7.875% due
11/15/04, market value $551,302) .................. $ 835,000 835,000
With J.P. Morgan Securities 5.63% 12/01/99
(dated 11/30/99, collateralized by $352,000
U.S. Treasury Notes 5.50% due 03/31/03,
market value $349,387 and $308,000 U.S.
Treasury Notes 6.25% due 02/15/03, market
value $314,916) ................................... 651,000 651,000
With PaineWebber 5.63% 12/01/99 (dated
11/30/99, collateralized by $663,000
U.S. Treasury Notes 5.50% due 01/31/03,
market value $663,725). ........................... 651,000 651,000
----------
Total Repurchase Agreements
(cost $2,137,000) ................................. 2,137,000
==========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------
<S> <C>
Total Market Value of Securities - 101.19%
(cost $19,466,941) ............................................. $16,030,505
Liabilities Net of Receivables and Other
Assets - (1.19%) ............................................... (188,926)
-----------
Net Assets Applicable to 1,974,266 Shares
($0.01 par value) outstanding - 100.00% ........................ $15,841,579
===========
Net Asset Value - Delaware Emerging Markets Fund
A Class ($7,815,242 / 970,979 shares) .......................... $8.05
=====
Net Asset Value - Delaware Emerging Markets Fund
B Class ($3,671,122 / 461,187 shares) .......................... $7.96
=====
Net Asset Value - Delaware Emerging Markets Fund
C Class ($1,564,677 / 196,706 shares) .......................... $7.95
=====
Net Asset Value - Delaware Emerging Markets Fund
Institutional Class ($2,790,538 / 345,394 shares) .............. $8.08
=====
Components of Net Assets at November 30, 1999:
Common stock, $0.01 par value, 500,000,000 shares
authorized to the Fund with 50,000,000 shares
allocated to Delaware Emerging Markets Fund A Class,
25,000,000 shares allocated to Delaware Emerging
Markets Fund B Class, 25,000,000 shares allocated to
Delaware Emerging Markets Fund C Class, and
50,000,000 shares allocated to Delaware Emerging
Markets Fund Institutional Class ............................... $21,552,381
Undistributed net investment income** ............................. 57,709
Accumulated net realized loss on investments ...................... (2,326,882)
Net unrealized depreciation of investments and
foreign currencies ............................................. (3,441,629)
-----------
Total net assets .................................................. $15,841,579
===========
_____________
*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.
ADR - American Depository Receipt
GDR - Global Depository Receipt
Net Asset Value and Offering Price Per Share -
Delaware Emerging Markets Fund
Net asset value A Class(A) ...................................... $8.05
Sales charge (5.75% of offering price or 6.09%
of the amount invested per share)(B) ......................... 0.49
-----
Offering price .................................................. $8.54
=====
_____________
(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 $50,000 or more.
</TABLE>
See accompanying notes
20
<PAGE>
Statements of Net Assets
Delaware Group Global & International Funds -- DELAWARE GLOBAL BOND FUND
<TABLE>
<CAPTION>
Principal Market
November 30, 1999 Amount* Value (US$)
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Bonds - 97.02%
Australia - 5.00%
New South Wales Treasury
6.50% 05/01/06 ................................A$ 1,150,000 $ 718,716
Queensland Treasury Global
8.00% 08/14/01 .................................. 270,000 177,573
---------
896,289
---------
Austria - 3.84%
Republic of Austria
7.25% 05/03/07 ............................. Dem 1,200,000 687,971
---------
687,971
---------
Canada - 8.09%
Government of Canada
5.25% 09/01/03 ............................... C$ 300,000 198,376
10.25% 03/15/14 ................................. 300,000 281,026
Ontario Hydro
5.60% 06/02/08 .................................. 700,000 452,412
10.00% 03/19/01 ................................. 470,000 336,501
Ontario Province 6.25% 12/03/08 .................NZ$ 400,000 182,853
---------
1,451,168
---------
Germany - 9.78%
Deutschland Republic
6.00% 07/04/07 ................................Eu 471,129 500,291
6.25% 01/04/24 .................................. 600,000 633,206
Depfa Pfandbriefbank 5.625% 02/07/03 ............... 600,000 621,286
---------
1,754,783
---------
Italy - 6.60%
Buoni Poliennali del Tes
4.50% 05/01/09 ................................Eu 750,000 714,361
Republic of Italy 5.00% 11/20/03 ................... 500,000 470,025
---------
1,184,386
---------
Japan - 1.98%
Japan Highway 7.875% 09/27/02 ....................C$ 500,000 354,499
---------
354,499
---------
Korea - 1.06%
Korea Electric Power 6.375% 12/01/03 ..............$ 200,000 189,940
---------
189,940
---------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Principal Market
Amount* Value (US$)
- ----------------------------------------------------------------------------------------
<S> <C> <C>
Bonds (continued)
Netherlands - 7.28%
Baden Wurt L-Finance
6.625% 08/20/03 ............................... Dem 675,000 $ 367,668
Netherlands Government
5.75% 02/15/07 ................................. Eu 600,000 628,063
9.00% 05/15/00 .................................... 300,000 309,826
---------
1,305,557
---------
New Zealand - 13.99%
New Zealand Government
6.00% 11/15/11 .................................NZ$ 1,300,000 602,295
7.00% 07/15/09 .................................... 200,000 101,486
8.00% 04/15/04 .................................... 1,200,000 637,405
8.00% 11/15/06 .................................... 900,000 484,132
10.00% 03/15/02 ................................... 1,250,000 684,793
---------
2,510,111
---------
Norway - 0.48%
Kingdom of Norway 8.375% 01/27/03 ..................C$ 120,000 86,506
---------
86,506
---------
Portugal - 3.91%
Portugese Government
5.375% 06/23/08 .................................Eu 700,000 701,785
---------
701,785
---------
South Africa - 4.98%
Republic of South Africa
12.50% 01/15/02 .................................Sa 3,700,000 593,145
13.00% 08/31/10 ................................... 2,000,000 300,459
---------
893,604
---------
Spain - 4.44%
Spanish Government 5.15% 07/30/09 ..................Eu 800,000 797,215
---------
797,215
---------
Supranational - 4.00%
International Bank Reconstruction &
Development 5.25% 01/12/09 .......................$ 800,000 717,208
---------
717,208
---------
Sweden - 4.30%
Swedish Export Credit 6.50% 06/05/01 ...............Sk 1,000,000 120,181
Swedish Government
9.00% 04/20/09 .................................... 4,000,000 583,305
10.25% 05/05/03 ................................... 500,000 67,992
---------
771,478
---------
</TABLE>
21
<PAGE>
Statements of Net Assets (Continued)
<TABLE>
<CAPTION>
Principal Market
Delaware Global Bond Fund Amount* Value (US$)
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Bonds (continued)
United Kingdom - 4.46%
Halifax 5.625% 07/23/07 .............................Dem 1,550,000 $ 799,679
-----------
799,679
-----------
United States - 12.83%
Federal National Mortgage Association
5.75% 09/05/00 ....................................A$ 600,000 382,986
KFW International Finance
6.50% 12/28/01 ....................................C$ 120,000 82,052
U.S.Treasury Inflation Index Notes
3.375% 01/15/07 ....................................$ 421,876 401,980
3.625% 01/15/08 ..................................... 613,674 591,630
U.S. Treasury Notes
5.75% 08/15/03 ...................................... 450,000 444,798
6.25% 02/15/07 ...................................... 250,000 249,684
6.375% 08/15/27 ..................................... 150,000 147,587
-----------
2,300,717
-----------
Total Bonds (cost $18,985,221) ......................... 17,402,896
===========
Total Market Value of Securities - 97.02%
(cost $18,985,221) .................................. $17,402,896
Receivables and Other Assets Net of
Liabilities - 2.98% ................................. 535,276
-----------
Net Assets Applicable to 1,795,801 Shares
($0.01 Par Value) Outstanding - 100.00% ............. $17,938,172
===========
Net Asset Value - Delaware Global Bond Fund
A Class ($3,943,861 / 394,577 shares) ............... $10.00
======
Net Asset Value - Delaware Global Bond Fund
B Class ($1,645,827 / 164,662 shares) ............... $10.00
======
Net Asset Value - Delaware Global Bond Fund
C Class ($680,724 / 68,491 shares) .................. $9.94
=====
Net Asset Value - Delaware Global Bond Fund
Institutional Class ($11,667,760 / 1,168,071 shares). $9.99
=====
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------
<S> <C>
Components of Net Assets at November 30, 1999:
Common stock, $0.01 par value, 500,000,000 shares
authorized to the Fund with 50,000,000 shares
allocated to Delaware Global Bond Fund A Class,
25,000,000 shares allocated to Delaware Global
Bond Fund B Class, 25,000,000 shares allocated
to Delaware Global Bond Fund C Class, and
50,000,000 shares allocated to Delaware
Global Bond Fund Institutional Class .............................. $19,673,185
Distributions in excess of net investment income** ................... (16,404)
Accumulated net realized loss on investments ......................... (126,020)
Net unrealized depreciation of investments and
foreign currencies ................................................ (1,592,589)
-----------
Total net assets ..................................................... $17,938,172
===========
_____________
* Principal amount is stated in the currency in which each bond is denominated.
A$ - Australian Dollars
C$ - Canadian Dollars
Dem - German Deutsche Marks
Eu - European Monetary Units
NZ$ - New Zealand Dollars
Sa - South African Rand
Sk - Swedish Kroner
$ - U.S. Dollar
**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 -
Delaware Global Bond Fund
Net asset value A Class(A) ........................................... $10.00
Sales charge (4.75% of offering price or 5.00%
of the amount invested per share)(B) .............................. 0.50
------
Offering price ....................................................... $10.50
======
____________
(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 $100,000 or more.
</TABLE>
See accompanying notes
22
<PAGE>
Statements of Operations
Delaware Group Global & International Funds
<TABLE>
<CAPTION>
Delaware Delaware Delaware Delaware
International Global Emerging Global Bond
Year Ended November 30, 1999 Equity Fund Equity Fund Markets Fund Fund
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Investment Income:
Interest .................................................. $ 768,243 $ 20,447 $ 68,782 $1,281,916
Dividends ................................................. 9,837,241 501,390 342,757 --
Foreign tax withheld ...................................... (1,037,821) (36,232) (26,129) --
----------------------------------------------------
9,567,663 485,605 385,410 1,281,916
----------------------------------------------------
Expenses:
Management fees ........................................... 2,614,396 140,074 155,098 144,725
Dividend disbursing and transfer agent fees and expenses .. 1,644,148 128,480 103,914 32,566
Distribution expense ...................................... 891,379 105,391 58,881 38,337
Custodian fees ............................................ 174,750 591 24,504 13,051
Accounting and administration ............................. 127,687 6,914 4,914 7,584
Reports and statements to shareholders .................... 172,350 14,855 11,200 7,125
Registration fees ......................................... 88,800 34,770 15,869 28,400
Professional fees ......................................... 121,035 7,500 5,682 --
Taxes (other than taxes on income) ........................ 28,150 840 -- 200
Trustees' fees ............................................ 5,671 697 768 714
Amortization of organization expenses ..................... -- 3,561 3,631 3,820
Other ..................................................... 74,214 10,140 9,885 4,808
----------------------------------------------------
5,942,580 453,813 391,207 281,330
Less expenses absorbed or waived .......................... -- (81,334) (126,367) (46,744)
Less expenses paid indirectly ............................. (7,442) (396) (1,790) (2,596)
----------------------------------------------------
Total expenses ............................................ 5,935,138 372,083 266,189 231,990
----------------------------------------------------
Net Investment Income ..................................... 3,632,525 113,522 119,221 1,049,926
----------------------------------------------------
Net Realized and Unrealized Gain (Loss) on Investments
and Foreign Currencies:
Net realized gain (loss) on:
Investments ............................................ 7,640,144 654,665 (826,202) (146,373)
Foreign currencies ..................................... 1,465,771 96,725 (26,502) (169,176)
----------------------------------------------------
Net realized gain (loss) .................................. 9,105,915 751,390 (852,704) (315,549)
Net change in unrealized appreciation/depreciation of
investments and foreign currencies ..................... 16,263,978 (355,190) 3,549,936 (1,409,629)
----------------------------------------------------
Net Realized and Unrealized Gain (Loss) on Investments
and Foreign Currencies ................................. 25,369,893 396,200 2,697,232 (1,725,178)
----------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting
from Operations ........................................ $29,002,418 $509,722 $2,816,453 ($675,252)
=====================================================
</TABLE>
See accompanying notes
23
<PAGE>
Statements of Changes in Net Assets
Delaware Group Global & International Funds
<TABLE>
<CAPTION>
Delaware International Delaware Global
Equity Fund Equity Fund
- ----------------------------------------------------------------------------------------------------------
Year Ended November 30, Year Ended November 30,
1999 1998 1999 1998
<S> <C> <C> <C> <C>
Increase (Decrease) in
Net Assets from Operations:
Net investment income .............................. $3,632,525 $5,019,760 $113,522 $337,208
Net realized gain (loss)
on investments
and foreign currencies .......................... 9,105,915 (3,196,161) 751,390 959,229
Net change in unrealized
appreciation/depreciation of
investments and
foreign currencies .............................. 16,263,978 18,869,098 (355,190) 58,825
---------------------------------------------------
Net increase (decrease)
in net assets resulting
from operations ................................. 29,002,418 20,692,697 509,722 1,355,262
---------------------------------------------------
Distributions to
Shareholders from:
Net investment income:
A Class ......................................... (1,890,091) (3,037,638) (67,715) (171,922)
B Class ......................................... (333,763) (567,801) (23,379) (78,621)
C Class ......................................... (146,074) (200,379) (13,394) (53,181)
Institutional Class ............................. (2,985,813) (2,491,733) (14,292) (70,840)
Net realized gain on investments:
A Class ......................................... -- (1,182,260) (366,425) (610,032)
B Class ......................................... -- (345,134) (270,108) (397,951)
C Class ......................................... -- (121,799) (168,225) (272,115)
Institutional Class ............................. -- (754,255) (131,263) (198,609)
---------------------------------------------------
(5,355,741) (8,700,999) (1,054,801) (1,853,271)
---------------------------------------------------
</TABLE>
RESTUB
<TABLE>
<CAPTION>
Delaware Emerging Delaware Global
Markets Fund Bond Fund
- -------------------------------------------------------------------------------------------------------
Year Ended November 30, Year Ended November 30,
1999 1998 1999 1998
<S> <C> <C> <C> <C>
Increase (Decrease) in
Net Assets from Operations:
Net investment income ......................... $119,221 $189,466 $1,049,926 $1,053,317
Net realized gain (loss)
on investments
and foreign currencies ..................... (852,704) (1,484,603) (315,549) (13,355)
Net change in unrealized
appreciation/depreciation of
investments and
foreign currencies ......................... 3,549,936 (4,195,214) (1,409,629) (4,946)
-----------------------------------------------------
Net increase (decrease)
in net assets resulting
from operations ............................ 2,816,453 (5,490,351) (675,252) 1,035,016
-----------------------------------------------------
Distributions to
Shareholders from:
Net investment income:
A Class .................................... (58,679) (18,319) (186,455) (166,398)
B Class .................................... (3,872) -- (67,827) (34,237)
C Class .................................... (1,386) -- (27,524) (20,219)
Institutional Class ........................ (15,279) (9,828) (580,647) (528,593)
Net realized gain on investments:
A Class .................................... -- (554,164) (44,575) (12,745)
B Class .................................... -- (207,819) (17,576) (3,044)
C Class .................................... -- (80,276) (5,593) (1,965)
Institutional Class ........................ -- (108,106) (124,376) (31,461)
-----------------------------------------------------
(79,216) (978,512) (1,054,573) (798,662)
-----------------------------------------------------
</TABLE>
24
<PAGE>
<TABLE>
<CAPTION>
Delaware International Delaware Global
Equity Fund Equity Fund
- ------------------------------------------------------------------------------------------------------------------------
Year Ended November 30, Year Ended November 30,
1999 1998 1999 1998
<S> <C> <C> <C> <C>
Capital Share Transactions:
Proceeds from shares sold:
A Class ............................................... $527,399,231 $248,532,751 $ 3,054,871 $ 2,361,979
B Class ............................................... 37,781,353 60,750,047 1,137,247 1,381,650
C Class ............................................... 146,537,454 111,824,042 447,132 734,792
Institutional Class ................................... 73,156,798 134,073,252 303,024 534,315
Net asset value of shares issued
upon reinvestment of distributions
from net investment income and
net realized gain on investments:
A Class ............................................... 1,753,906 3,884,411 426,759 751,633
B Class ............................................... 309,017 845,306 270,356 443,501
C Class ............................................... 86,965 284,894 170,283 291,513
Institutional Class ................................... 2,979,145 2,947,818 76,155 269,449
-----------------------------------------------------------
790,003,869 563,142,521 5,885,827 6,768,832
-----------------------------------------------------------
Cost of shares repurchased:
A Class ............................................... (561,503,159) (249,450,329) (3,251,609) (2,518,715)
B Class ............................................... (40,944,362) (57,621,538) (1,586,409) (744,541)
C Class ............................................... (147,929,924) (111,127,873) (1,305,309) (628,811)
Institutional Class ................................... (136,509,520) (44,978,467) (1,667,350) (423,236)
-----------------------------------------------------------
(886,886,965) (463,178,207) (7,810,677) (4,315,303)
-----------------------------------------------------------
Increase (decrease) in net assets
derived from capital share
transactions .......................................... (96,883,096) 99,964,314 (1,924,850) 2,453,529
-----------------------------------------------------------
Net Increase (Decrease)
in Net Assets ......................................... (73,236,419) 111,956,012 (2,469,929) 1,955,520
Net Assets:
Beginning of year ........................................ 339,282,731 227,326,719 18,743,722 16,788,202
-----------------------------------------------------------
End of year .............................................. $266,046,312 $339,282,731 $16,273,793 $18,743,722
===========================================================
</TABLE>
<PAGE>
RESTUB
<TABLE>
<CAPTION>
Delaware Emerging Delaware Global
Markets Fund Bond Fund
- -----------------------------------------------------------------------------------------------------------------------
Year Ended November 30, Year Ended November 30,
1999 1998 1999 1998
<S> <C> <C> <C> <C>
Capital Share Transactions:
Proceeds from shares sold:
A Class ............................................... $ 3,894,494 $ 3,500,308 $ 1,340,305 $ 1,209,209
B Class ............................................... 1,854,696 1,064,411 1,194,675 369,004
C Class ............................................... 730,055 469,587 473,390 46,266
Institutional Class ................................... 2,210,948 1,246,820 3,361,887 4,205,056
Net asset value of shares issued
upon reinvestment of distributions
from net investment income and
net realized gain on investments:
A Class ............................................... 54,297 525,839 167,600 125,332
B Class ............................................... 3,519 197,988 78,826 30,879
C Class ............................................... 1,323 76,653 32,145 21,384
Institutional Class ................................... 15,279 112,829 682,713 558,582
-------------------------------------------------------
8,764,611 7,194,435 7,331,541 6,565,712
-------------------------------------------------------
Cost of shares repurchased:
A Class ............................................... (3,043,824) (4,545,984) (1,873,705) (1,276,054)
B Class ............................................... (1,322,303) (779,647) (647,325) (306,186)
C Class ............................................... (303,935) (670,501) (296,153) (239,025)
Institutional Class ................................... (1,103,300) (1,200,434) (4,193,867) (3,262,721)
-------------------------------------------------------
(5,773,362) (7,196,566) (7,011,050) (5,083,986)
-------------------------------------------------------
Increase (decrease) in net assets
derived from capital share
transactions .......................................... 2,991,249 (2,131) 320,491 1,481,726
-------------------------------------------------------
Net Increase (Decrease)
in Net Assets ......................................... 5,728,486 (6,470,994) (1,409,334) 1,718,080
Net Assets:
Beginning of year ........................................ 10,113,093 16,584,087 19,347,506 17,629,426
-------------------------------------------------------
End of year .............................................. $15,841,579 $10,113,093 $17,938,172 $19,347,506
=======================================================
</TABLE>
See accompanying notes
25
<PAGE>
Financial Highlights
Delaware Group Global & International Funds
Selected data for each share of the Fund outstanding throughout each period were
as follows: Delaware International Equity Fund A Class
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended November 30,
1999 1998 1997 1996 1995
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ...................... $15.330 $ 14.650 $ 14.640 $12.190 $11.920
Income from investment operations:
Net investment income(1) ............................... 0.174 0.273 0.220 0.490 0.297
Net realized and unrealized gain on investments and
foreign currencies ................................... 0.881 0.957 0.245 2.385 0.628
---------------------------------------------------------
Total from investment operations ....................... 1.055 1.230 0.465 2.875 0.925
---------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ................... (0.235) (0.395) (0.435) (0.280) (0.185)
Distributions from net realized gain on investments .... none (0.155) (0.020) (0.145) (0.470)
---------------------------------------------------------
Total dividends and distributions ...................... (0.235) (0.550) (0.455) (0.425) (0.655)
---------------------------------------------------------
Net asset value, end of period ............................ $16.150 $15.330 $14.650 $14.640 $12.190
=========================================================
Total return(2) ........................................... 6.97% 8.75% 3.27% 24.22% 8.17%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ................ $99,671 $122,609 $112,425 $89,177 $62,251
Ratio of expenses to average net assets ................ 1.86% 1.70% 1.70% 1.85% 2.07%
Ratio of expenses to average net assets prior to
expense limitation and expenses paid indirectly ...... 1.86% 1.70% 1.71% 1.95% 2.07%
Ratio of net investment income to average net assets ... 1.10% 1.80% 1.46% 3.70% 2.57%
Ratio of net investment income to average net assets
prior to expense limitation and expenses paid
indirectly ........................................... 1.10% 1.80% 1.45% 3.60% 2.57%
Portfolio turnover ..................................... 3% 5% 8% 9% 21%
</TABLE>
- ----------------
(1) Per share information for the years ended November 30, 1996, 1997, 1998, and
1999 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
26
<PAGE>
Selected data for each share of the Fund outstanding throughout each period were
as follows: Delaware International Equity Fund B Class
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended November 30,
1999 1998 1997 1996 1995
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ...................... $15.280 $14.560 $14.560 $12.130 $11.900
Income from investment operations:
Net investment income(1) ............................... 0.063 0.168 0.114 0.398 0.278
Net realized and unrealized gain on investments and
foreign currencies ................................... 0.877 0.962 0.246 2.377 0.567
---------------------------------------------------------
Total from investment operations ....................... 0.940 1.130 0.360 2.775 0.845
---------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ................... (0.130) (0.255) (0.340) (0.200) (0.145)
Distributions from net realized gain on investments .... -- (0.155) (0.020) (0.145) (0.470)
---------------------------------------------------------
Total dividends and distributions ...................... (0.130) (0.410) (0.360) (0.345) (0.615)
---------------------------------------------------------
Net asset value, end of period ............................ $16.090 $15.280 $14.560 $14.560 $12.130
=========================================================
Total return(2) ........................................... 6.21% 8.03% 2.54% 23.38% 7.46%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ................ $36,997 $37,775 $31,914 $10,878 $ 3,471
Ratio of expenses to average net assets ................ 2.56% 2.40% 2.40% 2.55% 2.77%
Ratio of expenses to average net assets prior to
expense limitation and expenses paid indirectly ...... 2.56% 2.40% 2.41% 2.65% 2.77%
Ratio of net investment income to average net assets ... 0.40% 1.10% 0.76% 3.00% 1.87%
Ratio of net investment income to average net assets
prior to expense limitation and expenses paid
indirectly ........................................... 0.40% 1.10% 0.75% 2.90% 1.87%
Portfolio turnover ..................................... 3% 5% 8% 9% 21%
</TABLE>
- ----------------
(1) Per share information for the years ended November 30, 1996, 1997, 1998, and
1999 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
27
<PAGE>
Financial Highlights (Continued)
Delaware Group Global & International Funds
Selected data for each share of the Fund outstanding throughout each period were
as follows: Delaware International Equity Fund C Class
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended November 30, 11/29/95(2)
1999 1998 1997 1996 to 11/30/95
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ...................... $15.260 $14.540 $14.540 $12.190 $12.240
Income (loss) from investment operations:
Net investment income(1) ............................... 0.063 0.167 0.114 0.400 none
Net realized and unrealized gain (loss) on investments
and foreign currencies ............................... 0.877 0.963 0.246 2.375 (0.050)
---------------------------------------------------------
Total from investment operations ....................... 0.940 1.130 0.360 2.775 (0.050)
---------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ................... (0.130) (0.255) (0.340) (0.280) none
Distributions from net realized gain on investments .... none (0.155) (0.020) (0.145) none
---------------------------------------------------------
Total dividends and distributions ...................... (0.130) (0.410) (0.360) (0.425) none
---------------------------------------------------------
Net asset value, end of period ............................ $16.070 $15.260 $14.540 $14.540 $12.190
=========================================================
Total return(3) ........................................... 6.22% 8.04% 2.54% 23.39% (4)
Ratios and supplemental data:
Net assets, end of period (000 omitted) ................ $14,369 $14,076 $11,811 $ 1,909 $ 5
Ratio of expenses to average net assets ................ 2.56% 2.40% 2.40% 2.55% (4)
Ratio of expenses to average net assets prior to
expense limitation and expenses paid indirectly ...... 2.56% 2.40% 2.41% 2.65% (4)
Ratio of net investment income to average net assets ... 0.40% 1.10% 0.76% 3.00% (4)
Ratio of net investment income to average net assets
prior to expense limitation and expenses paid
indirectly ........................................... 0.40% 1.10% 0.75% 2.90% (4)
Portfolio turnover ..................................... 3% 5% 8% 9% (4)
</TABLE>
- ----------------
(1) Per share information for the years ended November 30, 1996, 1997, 1998, and
1999 was based on the average shares outstanding method.
(2) Date of commencement of trading.
(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) 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
28
<PAGE>
Selected data for each share of the Fund outstanding throughout each period were
as follows: Delaware International Equity Fund Institutional Class
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended November 30,
1999 1998 1997 1996 1995
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ...................... $ 15.370 $ 14.720 $14.710 $12.240 $11.970
Income from investment operations:
Net investment income(1) ............................... 0.222 0.318 0.267 0.530 0.323
Net realized and unrealized gain on investments and
foreign currencies ................................... 0.880 0.962 0.238 2.405 0.637
----------------------------------------------------------
Total from investment operations ....................... 1.102 1.280 0.505 2.935 0.960
----------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ................... (0.282) (0.475) (0.475) (0.320) (0.220)
Distributions from net realized gain on investments .... none (0.155) (0.020) (0.145) (0.470)
----------------------------------------------------------
Total dividends and distributions ...................... (0.282) (0.630) (0.495) (0.465) (0.690)
----------------------------------------------------------
Net asset value, end of period ............................ $ 16.190 $ 15.370 $14.720 $14.710 $12.240
==========================================================
Total return(2) ........................................... 7.26% 9.10% 3.55% 24.68% 8.46%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ................ $115,009 $164,823 $71,177 $34,194 $11,660
Ratio of expenses to average net assets ................ 1.56% 1.40% 1.40% 1.55% 1.77%
Ratio of expenses to average net assets prior to
expense limitation and expenses paid indirectly ...... 1.56% 1.40% 1.41% 1.65% 1.77%
Ratio of net investment income to average net assets ... 1.40% 2.10% 1.76% 4.00% 2.87%
Ratio of net investment income to average net assets
prior to expense limitation and expenses paid
indirectly ........................................... 1.40% 2.10% 1.75% 3.90% 2.87%
Portfolio turnover ..................................... 3% 5% 8% 9% 21%
</TABLE>
- ----------------
(1) Per share information for the years ended November 30, 1996, 1997, 1998, and
1999 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.
See accompanying notes
29
<PAGE>
Financial Highlights (Continued)
Delaware Group Global & International Funds
Selected data for each share of the Fund outstanding throughout each period were
as follows: Delaware Global Equity Fund A Class
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended November 30, 12/27/94(1)
1999 1998 1997 1996 to 11/30/95
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ...................... $13.600 $14.050 $13.310 $11.900 $10.000
Income from investment operations:
Net investment income(2) ............................... 0.130 0.289 0.437 0.493 0.301
Net realized and unrealized gain on investments and
foreign currencies ................................... 0.290 0.826 0.843 1.572 1.839
---------------------------------------------------------
Total from investment operations ....................... 0.420 1.115 1.280 2.065 2.140
---------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ................... (0.120) (0.335) (0.490) (0.385) (0.240)
Distributions from net realized gain on investments .... (0.680) (1.230) (0.050) (0.270) none
---------------------------------------------------------
Total dividends and distributions ...................... (0.800) (1.565) (0.540) (0.655) (0.240)
---------------------------------------------------------
Net asset value, end of period ............................ $13.220 $13.600 $14.050 $13.310 $11.900
=========================================================
Total return(3) ........................................... 3.17% 8.83% 9.91% 18.17% 21.48%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ................ $ 7,386 $ 7,329 $ 6,939 $11,878 $ 3,122
Ratio of expenses to average net assets ................ 1.85% 1.55% 1.25% 1.25% 1.25%
Ratio of expenses to average net assets prior to
expense limitation and expenses paid indirectly ...... 2.32% 1.99% 2.16% 2.72% 7.55%
Ratio of net investment income to average net assets ... 0.97% 2.17% 3.24% 4.13% 4.75%
Ratio of net investment income (loss) to average net
assets prior to expense limitation and expenses paid
indirectly ........................................... 0.50% 1.73% 2.33% 2.66% (1.55%)
Portfolio turnover ..................................... 29% 90% 74% 34% 57%
</TABLE>
- ----------------
(1) Date of commencement of trading; ratios and total return have been
annualized.
(2) Per share information for the years ended November 30, 1997, 1998, and 1999
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
30
<PAGE>
Selected data for each share of the Fund outstanding throughout each period were
as follows: Delaware Global Equity Fund B Class
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended November 30, 12/27/94(1)
1999 1998 1997 1996 to 11/30/95
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ...................... $13.600 $14.040 $13.300 $11.880 $10.000
Income from investment operations:
Net investment income(2) ............................... 0.036 0.197 0.342 0.379 0.212
Net realized and unrealized gain on investments and
foreign currencies ................................... 0.294 0.813 0.848 1.606 1.848
---------------------------------------------------------
Total from investment operations ....................... 0.330 1.010 1.190 1.985 2.060
---------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ................... (0.060) (0.220) (0.400) (0.295) (0.180)
Distributions from net realized gain on investments .... (0.680) (1.230) (0.050) (0.270) none
---------------------------------------------------------
Total dividends and distributions ...................... (0.740) (1.450) (0.450) (0.565) (0.180)
---------------------------------------------------------
Net asset value, end of period ............................ $13.190 $13.600 $14.040 $13.300 $11.880
=========================================================
Total return(3) ........................................... 2.56% 7.97% 9.18% 17.32% 20.73%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ................ $ 5,044 $ 5,397 $ 4,445 $ 4,796 $ 613
Ratio of expenses to average net assets ................ 2.55% 2.25% 1.95% 1.95% 1.95%
Ratio of expenses to average net assets prior to
expense limitation and expenses paid indirectly ...... 3.02% 2.69% 2.86% 3.42% 8.25%
Ratio of net investment income to average net assets ... 0.27% 1.47% 2.54% 3.43% 4.05%
Ratio of net investment income (loss) to average net
assets prior to expense limitation and expenses paid
indirectly ........................................... (0.20%) 1.03% 1.63% 1.96% (2.25%)
Portfolio turnover ..................................... 29% 90% 74% 34% 57%
</TABLE>
- ----------------
(1) Date of commencement of trading; ratios and total return have been
annualized.
(2) Per share information for the years ended November 30, 1997, 1998, and 1999
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
31
<PAGE>
Financial Highlights (Continued)
Delaware Group Global & International Funds
Selected data for each share of the Fund outstanding throughout each period were
as follows: Delaware Global Equity Fund C Class
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended November 30, 11/29/95(1)
1999 1998 1997 1996 to 11/30/95
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ...................... $13.550 $13.990 $13.250 $11.890 $11.940
Income (loss) from investment operations:
Net investment income(2) ............................... 0.036 0.197 0.341 0.446 none
Net realized and unrealized gain (loss) on investments
and foreign currencies ............................... 0.294 0.813 0.849 1.534 (0.050)
---------------------------------------------------------
Total from investment operations ....................... 0.330 1.010 1.190 1.980 (0.050)
---------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ................... (0.060) (0.220) (0.400) (0.350) none
Distributions from net realized gain on investments .... (0.680) (1.230) (0.050) (0.270) none
---------------------------------------------------------
Total dividends and distributions ...................... (0.740) (1.450) (0.450) (0.620) none
---------------------------------------------------------
Net asset value, end of period ............................ $13.140 $13.550 $13.990 $13.250 $11.890
=========================================================
Total return(3) ........................................... 2.57% 8.00% 9.21% 17.33% (4)
Ratios and supplemental data:
Net assets, end of period (000 omitted) ................ $ 2,614 $ 3,391 $ 3,094 $ 1,185 $ 5
Ratio of expenses to average net assets ................ 2.55% 2.25% 1.95% 1.95% (4)
Ratio of expenses to average net assets prior to
expense limitation and expenses paid indirectly ...... 3.02% 2.69% 2.86% 3.42% (4)
Ratio of net investment income to average net assets ... 0.27% 1.47% 2.54% 3.43% (4)
Ratio of net investment income (loss) to average net
assets prior to expense limitation and expenses paid
indirectly ........................................... (0.20%) 1.03% 1.63% 1.96% (4)
Portfolio turnover ..................................... 29% 90% 74% 34% (4)
</TABLE>
- ----------------
(1) Date of commencement of trading.
(2) Per share information for the years ended November 30, 1997, 1998, and 1999
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) 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
32
<PAGE>
Selected data for each share of the Fund outstanding throughout each period were
as follows: Delaware Global Equity Fund Institutional Class
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended November 30, 12/27/94(1)
1999 1998 1997 1996 to 11/30/95
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ...................... $13.610 $14.100 $13.340 $11.930 $10.000
Income from investment operations:
Net investment income(2) ............................... 0.170 0.329 0.478 0.567 0.473
Net realized and unrealized gain on investments and
foreign currencies ................................... 0.300 0.816 0.857 1.533 1.697
---------------------------------------------------------
Total from investment operations ....................... 0.470 1.145 1.335 2.100 2.170
---------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ................... (0.150) (0.405) (0.525) (0.420) (0.240)
Distributions from net realized gain on investments .... (0.680) (1.230) (0.050) (0.270) none
---------------------------------------------------------
Total dividends and distributions ...................... (0.830) (1.635) (0.575) (0.690) (0.240)
---------------------------------------------------------
Net asset value, end of period ............................ $13.250 $13.610 $14.100 $13.340 $11.930
=========================================================
Total return(3) ........................................... 3.63% 9.07% 10.34% 18.38% 21.88%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ................ $ 1,229 $ 2,627 $ 2,310 $ 2,203 $ 2,191
Ratio of expenses to average net assets ................ 1.55% 1.25% 0.95% 0.95% 0.95%
Ratio of expenses to average net assets prior to
expense limitation and expenses paid indirectly ...... 2.02% 1.69% 1.86% 2.42% 7.25%
Ratio of net investment income to average net assets ... 1.27% 2.47% 3.54% 4.43% 5.05%
Ratio of net investment income (loss) to average net
assets prior to expense limitation and expenses paid
indirectly ........................................... 0.80% 2.03% 2.63% 2.96% (1.25%)
Portfolio turnover ..................................... 29% 90% 74% 34% 57%
</TABLE>
- ----------------
(1) Date of commencement of trading; ratios have been annualized and total
return has not been annualized.
(2) Per share information for the years ended November 30, 1997, 1998, and 1999
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.
See accompanying notes
33
<PAGE>
Financial Highlights (Continued)
Delaware Group Global & International Funds
Selected data for each share of the Fund outstanding throughout each period were
as follows: Delaware Emerging Markets Fund A Class
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended November 30, 6/10/96(1)
1999 1998 1997 to 11/30/96
<S> <C> <C> <C> <C>
Net asset value, beginning of period ...................... $ 6.530 $10.200 $ 9.970 $10.000
Income (loss) from investment operations:
Net investment income (loss)(2) ........................ 0.081 0.129 0.062 0.018
Net realized and unrealized gain (loss)
on investments and foreign currencies ................ 1.509 (3.174) 0.253 (0.048)
--------------------------------------------
Total from investment operations ....................... 1.590 (3.045) 0.315 (0.030)
--------------------------------------------
Less dividends and distributions:
Dividends from net investment income ................... (0.070) (0.020) (0.010) none
Distributions from net realized gain on investments .... none (0.605) (0.075) none
--------------------------------------------
Total dividends and distributions ...................... (0.070) (0.625) (0.085) none
--------------------------------------------
Net asset value, end of period ............................ $ 8.050 $ 6.530 $10.200 $ 9.970
============================================
Total return(3) ........................................... 24.74% (31.66%) 3.19% (0.30%)
Ratios and supplemental data:
Net assets, end of period (000 omitted) ................... $ 7,815 $5,584 $9,665 $2,518
Ratio of expenses to average net assets ................... 1.95% 1.96% 2.00% 2.00%
Ratio of expenses to average net assets prior to
expense limitation and expenses paid indirectly ......... 2.99% 3.91% 3.02% 4.10%
Ratio of net investment income (loss) to average net
assets .................................................. 1.15% 1.58% 0.52% 0.17%
Ratio of net investment income (loss) to average net
assets prior to expense limitation and expenses paid
indirectly .............................................. 0.11% (0.37%) (0.50%) (1.93%)
Portfolio turnover ........................................ 17% 47% 65% 36%
</TABLE>
- ----------------
(1) Date of commencement of trading; 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
34
<PAGE>
Selected data for each share of the Fund outstanding throughout each period were
as follows: Delaware Emerging Markets Fund B Class
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended November 30, 6/10/96(1)
1999 1998 1997 to 11/30/96
<S> <C> <C> <C> <C>
Net asset value, beginning of period ........................................ $6.440 $10.110 $9.940 $10.000
Income (loss) from investment operations: ...................................
Net investment income (loss)(2) .......................................... 0.029 0.070 (0.020) (0.051)
Net realized and unrealized gain (loss)
on investments and foreign currencies .................................. 1.501 (3.135) 0.265 (0.009)
----------------------------------------------
Total from investment operations ......................................... 1.530 (3.065) 0.245 (0.060)
----------------------------------------------
Less dividends and distributions:
Dividends from net investment income ..................................... (0.010) none none none
Distributions from net realized gain on investments ...................... none (0.605) (0.075) none
----------------------------------------------
Total dividends and distributions ........................................ (0.010) (0.605) (0.075) none
----------------------------------------------
Net asset value, end of period .............................................. $7.960 $6.440 $10.110 $9.940
==============================================
Total return(3) ............................................................. 23.81% (32.11%) 2.48% (0.60%)
Ratios and supplemental data:
Net assets, end of period (000 omitted) ..................................... $3,671 $2,528 $3,484 $282
Ratio of expenses to average net assets ..................................... 2.70% 2.70% 2.70% 2.70%
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly ................................... 3.69% 4.61% 3.72% 4.80%
Ratio of net investment income (loss) to average net assets ................. 0.40% 0.84% (0.18%) (0.53%)
Ratio of net investment income (loss) to average net assets prior
to expense limitation and expenses paid indirectly ........................ (0.59%) (1.07%) (1.20%) (2.63%)
Portfolio turnover .......................................................... 17% 47% 65% 36%
</TABLE>
- ----------------
(1) Date of commencement of trading; 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
35
<PAGE>
Financial Highlights (Continued)
Delaware Group Global & International Funds
Selected data for each share of the Fund outstanding throughout each period were
as follows: Delaware Emerging Markets Fund C Class
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended November 30, 6/10/96(1)
1999 1998 1997 to 11/30/96
<S> <C> <C> <C> <C>
Net asset value, beginning of period ........................................ $6.430 $10.110 $9.940 $10.000
Income (loss) from investment operations:
Net investment income (loss)(2) .......................................... 0.029 0.068 (0.019) (0.051)
Net realized and unrealized gain (loss)
on investments and foreign currencies .................................. 1.501 (3.143) 0.264 (0.009)
----------------------------------------------
Total from investment operations ......................................... 1.530 (3.075) 0.245 (0.060)
----------------------------------------------
Less dividends and distributions:
Dividends from net investment income ..................................... (0.010) none none none
Distributions from net realized gain on investments ...................... none (0.605) (0.075) none
----------------------------------------------
Total dividends and distributions ........................................ (0.010) (0.605) (0.075) none
----------------------------------------------
Net asset value, end of period .............................................. $7.950 $6.430 $10.110 $9.940
==============================================
Total return(3) ............................................................. 23.85% (32.21%) 2.48% (0.60%)
Ratios and supplemental data:
Net assets, end of period (000 omitted) ..................................... $1,565 $884 $1,519 $199
Ratio of expenses to average net assets ..................................... 2.70% 2.70% 2.70% 2.70%
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly ................................... 3.69% 4.61% 3.72% 4.80%
Ratio of net investment income (loss) to average net assets ................. 0.40% 0.84% (0.18%) (0.53%)
Ratio of net investment income (loss) to average net assets prior
to expense limitation and expenses paid indirectly ........................ (0.59%) (1.07%) (1.20%) (2.63%)
Portfolio turnover .......................................................... 17% 47% 65% 36%
</TABLE>
- ----------------
(1) Date of commencement of trading; 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
36
<PAGE>
Selected data for each share of the Fund outstanding throughout each period were
as follows: Delaware Emerging Markets Fund Institutional Class
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended November 30, 6/10/96(1)
1999 1998 1997 to 11/30/96
<S> <C> <C> <C> <C>
Net asset value, beginning of period ........................................ $6.550 $10.250 $9.990 $10.000
Income (loss) from investment operations:
Net investment income (loss)(2) .......................................... 0.099 0.151 0.098 0.047
Net realized and unrealized gain (loss)
on investments and foreign currencies .................................. 1.521 (3.191) 0.262 (0.057)
----------------------------------------------
Total from investment operations ......................................... 1.620 (3.040) 0.360 (0.010)
----------------------------------------------
Less dividends and distributions:
Dividends from net investment income ..................................... (0.090) (0.055) (0.025) none
Distributions from net realized gain on investments ...................... none (0.605) (0.075) none
----------------------------------------------
Total dividends and distributions ........................................ (0.090) (0.660) (0.100) none
----------------------------------------------
Net asset value, end of period .............................................. $8.080 $6.550 $10.250 $9.990
==============================================
Total return(3) ............................................................. 25.24% (31.55%) 3.64% (0.10%)
Ratios and supplemental data:
Net assets, end of period (000 omitted) ..................................... $2,791 $1,117 $1,916 $3,717
Ratio of expenses to average net assets ..................................... 1.70% 1.70% 1.70% 1.70%
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly ................................... 2.69% 3.61% 2.72% 3.80%
Ratio of net investment income (loss) to average net assets ................. 1.40% 1.84% 0.82% 0.47%
Ratio of net investment income (loss) to average net assets prior
to expense limitation and expenses paid indirectly ........................ 0.41% (0.07%) (0.20%) (1.63%)
Portfolio turnover .......................................................... 17% 47% 65% 36%
</TABLE>
- ----------------
(1) Date of commencement of trading; 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.
See accompanying notes
37
<PAGE>
Financial Highlights (Continued)
Delaware Group Global & International Funds
Selected data for each share of the Fund outstanding throughout each period were
as follows: Delaware Global Bond Fund A Class
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended November 30, 12/27/94(1)
1999 1998 1997 1996 to 11/30/95
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period .................................. $10.940 $10.790 $11.480 $11.230 $10.000
Income (loss) from investment operations:
Net investment income(2) ........................................... 0.560 0.595 0.625 0.755 0.659
Net realized and unrealized gain (loss) on investments and
foreign currencies ............................................... (0.935) (0.015) (0.505) 0.730 1.171
---------------------------------------------------------
Total from investment operations ................................... (0.375) 0.580 0.120 1.485 1.830
---------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ............................... (0.460) (0.400) (0.770) (0.875) (0.600)
Distributions from net realized gain on investments ................ (0.105) (0.030) (0.040) (0.360) none
---------------------------------------------------------
Total dividends and distributions .................................. (0.565) (0.430) (0.810) (1.235) (0.600)
---------------------------------------------------------
Net asset value, end of period ........................................ $10.000 $10.940 $10.790 $11.480 $11.230
=========================================================
Total return(3) ....................................................... (3.50%) 5.47% 1.24% 14.35% 18.79%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ............................ $3,944 $4,684 $4,567 $3,467 $889
Ratio of expenses to average net assets ............................ 1.30% 1.25% 1.25% 1.25% 1.25%
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly .......................... 1.54% 1.59% 2.04% 5.00% 12.34%
Ratio of net investment income to average net assets ............... 5.34% 5.58% 5.76% 6.82% 7.70%
Ratio of net investment income (loss) to average net assets prior
to expense limitation and expenses paid indirectly ............... 5.10% 5.24% 4.97% 3.07% (3.39%)
Portfolio turnover ................................................. 90% 93% 76% 42% 98%
</TABLE>
- ----------------
(1) Date of commencement of trading; ratios have been annualized and total
return has not been annualized.
(2) Per share information for the years ended November 30, 1996, 1997, 1998, and
1999 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
38
<PAGE>
Selected data for each share of the Fund outstanding throughout each period were
as follows: Delaware Global Bond Fund B Class
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended November 30, 12/27/94(1)
1999 1998 1997 1996 to 11/30/95
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period .................................. $10.930 $10.790 $11.490 $11.230 $10.000
Income (loss) from investment operations:
Net investment income(2) ........................................... 0.487 0.520 0.550 0.679 0.565
Net realized and unrealized gain (loss) on investments and
foreign currencies ............................................... (0.927) (0.020) (0.511) 0.735 1.205
---------------------------------------------------------
Total from investment operations ................................... (0.440) 0.500 0.039 1.414 1.770
---------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ............................... (0.385) (0.330) (0.699) (0.794) (0.540)
Distributions from net realized gain on investments ................ (0.105) (0.030) (0.040) (0.360) none
---------------------------------------------------------
Total dividends and distributions .................................. (0.490) (0.360) (0.739) (1.154) (0.540)
---------------------------------------------------------
Net asset value, end of period ........................................ $10.000 $10.930 $10.790 $11.490 $11.230
=========================================================
Total return(3) ....................................................... (4.01%) 4.59% 0.48% 13.51% 18.23%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ............................ $1,646 $1,188 $1,081 $707 $115
Ratio of expenses to average net assets ............................ 2.00% 1.95% 1.95% 1.95% 1.95%
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly .......................... 2.24% 2.29% 2.74% 5.70% 13.04%
Ratio of net investment income to average net assets ............... 4.64% 4.88% 5.06% 6.12% 7.00%
Ratio of net investment income (loss) to average net assets
prior to expense limitation and expenses paid indirectly ......... 4.40% 4.54% 4.27% 2.37% (4.09%)
Portfolio turnover ................................................. 90% 93% 76% 42% 98%
</TABLE>
- ----------------
(1) Date of commencement of trading; ratios have been annualized and total
return has not been annualized.
(2) Per share information for the years ended November 30, 1996, 1997, 1998, and
1999 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
39
<PAGE>
Financial Highlights (Continued)
Delaware Group Global & International Funds
Selected data for each share of the Fund outstanding throughout each period were
as follows: Delaware Global Bond Fund C Class
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended November 30, 11/29/95(1)
1999 1998 1997 1996 to 11/30/95
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period .................................. $10.880 $10.740 $11.440 $11.240 $11.330
Income (loss) from investment operations:
Net investment income(2) ........................................... 0.487 0.521 0.551 0.680 none
Net realized and unrealized gain (loss) on investments and
foreign currencies ............................................... (0.937) (0.021) (0.512) 0.719 (0.036)
--------------------------------------------------------
Total from investment operations ................................... (0.450) 0.500 0.039 1.399 (0.036)
--------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ............................... (0.385) (0.330) (0.699) (0.839) (0.054)
Distributions from net realized gain on investments ................ (0.105) (0.030) (0.040) (0.360) none
--------------------------------------------------------
Total dividends and distributions .................................. (0.490) (0.360) (0.739) (1.199) (0.054)
--------------------------------------------------------
Net asset value, end of period ........................................ $9.940 $10.880 $10.740 $11.440 $11.240
========================================================
Total return(3) ....................................................... (4.21%) 4.71% 0.49% 13.51% (4)
Ratios and supplemental data:
Net assets, end of period (000 omitted) ............................ $681 $539 $703 $118 $5
Ratio of expenses to average net assets ............................ 2.00% 1.95% 1.95% 1.95% (4)
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly .......................... 2.24% 2.29% 2.74% 5.70% (4)
Ratio of net investment income to average net assets ............... 4.64% 4.88% 5.06% 6.12% (4)
Ratio of net investment income to average net assets prior
to expense limitation and expenses paid indirectly ............... 4.40% 4.54% 4.27% 2.37% (4)
Portfolio turnover ................................................. 90% 93% 76% 42% (4)
</TABLE>
- ----------------
(1) Date of commencement of trading.
(2) Per share information for the years ended November 30, 1996, 1997, 1998, and
1999 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) 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
40
<PAGE>
Selected data for each share of the Fund outstanding throughout each period were
as follows: Delaware Global Bond Fund Institutional Class
<TABLE>
<CAPTION>
Year Ended November 30, 12/27/94(1)
1999 1998 1997 1996 to 11/30/95
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period .................................. $10.930 $10.810 $11.520 $11.270 $10.000
Income (loss) from investment operations:
Net investment income(2) ........................................... 0.592 0.627 0.658 0.788 0.782
Net realized and unrealized gain (loss) on investments and
foreign currencies ............................................... (0.937) (0.017) (0.515) 0.732 1.088
--------------------------------------------------------
Total from investment operations ................................... (0.345) 0.610 0.143 1.520 1.870
--------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ............................... (0.490) (0.460) (0.813) (0.910) (0.600)
Distributions from net realized gain on investments ................ (0.105) (0.030) (0.040) (0.360) none
--------------------------------------------------------
Total dividends and distributions .................................. (0.595) (0.490) (0.853) (1.270) (0.600)
--------------------------------------------------------
Net asset value, end of period ........................................ $9.990 $10.930 $10.810 $11.520 $11.270
========================================================
Total return(3) ....................................................... (3.31%) 5.88% 1.45% 14.68% 19.21%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ............................ $11,668 $12,937 $11,278 $6,707 $897
Ratio of expenses to average net assets ............................ 1.00% 0.95% 0.95% 0.95% 0.95%
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly .......................... 1.24% 1.29% 1.74% 4.70% 12.04%
Ratio of net investment income to average net assets ............... 5.64% 5.88% 6.06% 7.12% 8.00%
Ratio of net investment income (loss) to average net assets prior
to expense limitation and expenses paid indirectly ............... 5.40% 5.54% 5.27% 3.37% (3.09%)
Portfolio turnover ................................................. 90% 93% 76% 42% 98%
</TABLE>
- ----------------
(1) Date of commencement of trading; ratios have been annualized and total
return has not been annualized.
(2) Per share information for the years ended November 30, 1996, 1997, 1998, and
1999 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.
See accompanying notes
41
<PAGE>
Notes to Financial Statements
November 30, 1999
- --------------------------------------------------------------------------------
Delaware Group Global & International Funds (the "Fund") is registered as a
Delaware business trust and offers eight funds: the Delaware International
Equity Fund, the Delaware Global Equity Fund, the Delaware Emerging Markets
Fund, the Delaware Global Bond 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 the related notes
pertain to the Delaware International Equity Fund, the Delaware Global Equity
Fund, the Delaware Emerging Markets Fund and the Delaware Global Bond Fund, (the
"Fund"). The Delaware International Equity Fund is registered as a diversified
open-end investment company, and the Delaware Global Equity Fund, the Delaware
Emerging Markets Fund and the Delaware Global Bond Fund, are registered as
non-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% for all Funds except the Delaware
Global Bond Fund, 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 Fund is as follows:
Delaware International Equity Fund: 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.
Delaware Global Equity Fund: To seek long-term total return by investing in
securities, including U.S. and foreign stocks, with the potential for capital
appreciation and income.
Delaware Emerging Markets Fund: To seek long-term capital appreciation by
investing primarily in equity securities of issuers located or operating in
emerging market countries.
Delaware Global Bond Fund: 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.
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 Fund 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 Fund's Board of Trustees.
<PAGE>
Federal Income Taxes - Each Fund 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 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
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 Funds do
isolate that portion of gains and losses on investments in 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 Funds 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
42
<PAGE>
- --------------------------------------------------------------------------------
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.
Original issue discounts are accreted to interest income over the lives of the
respective securities. Each Fund declares and pays dividends from capital gains,
if any, annually and from net investment income as follows: the Delaware
International Equity Fund, the Delaware Global Equity Fund and the Delaware
Global Bond Fund quarterly, and the Delaware Emerging Markets Fund annually.
Certain expenses of the Fund are paid through "soft dollar" arrangements with
brokers. These transactions are done subject to best price and 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 arrangement are included in their respective expense captions on the
Statement of Operations with the corresponding expense 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 Delaware Delaware
International Global Emerging Global
Equity Equity Markets Bond
Fund Fund Fund Fund
----------------------------------------------
<S> <C> <C> <C> <C>
"Soft Dollar" Expenses $7,442 $396 $ 286 $445
Earnings Credits -- -- 1,504 2,151
</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, an
annual fee based on its net assets. The management fee rates changed effective
April 1, 1999, with the exception of the Delaware International Equity Fund
which was effective April 15, 1999.
Following are the new management fees as a percentage of average daily net
assets:
<TABLE>
<CAPTION>
Delaware Delaware Delaware Delaware
International Global Emerging Global
Equity Equity Markets Bond
Fund Fund Fund Fund
------------------------------------------------
<S> <C> <C> <C> <C>
On the first $500 million ........................... 0.85% 0.85% 1.25% 0.75%
On the next $500 million ............................ 0.80% 0.80% 1.20% 0.70%
On the next $1.5 billion ............................ 0.75% 0.75% 1.15% 0.65%
In excess of $2.5 billion ........................... 0.70% 0.70% 1.10% 0.60%
</TABLE>
Following are the management fees that were in effect for each Fund prior to the
effective dates of the new rates:
<TABLE>
<CAPTION>
Delaware Delaware Delaware Delaware
International Global Emerging Global
Equity Equity Markets Bond
Fund Fund Fund Fund
-----------------------------------------------
<S> <C> <C> <C> <C>
Management fee as a percentage of average daily net
assets (per annum) ................................ 0.75%* 0.75%* 1.25% 0.75%*
</TABLE>
*Less fees paid to the unaffiliated directors
DIAL has entered into a sub-advisory agreement with Delaware Management Company
("DMC"), an affiliate, with respect to the management of the Delaware Global
Equity Funds' investment in U.S. securities. DMC receives 25% of the management
fee paid to DIAL for managing the U.S. securities portion of the Delaware Global
Equity Fund.
DIAL has elected to waive its fees and reimburse each Fund 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 Delaware Global Equity Fund, 1.70% for each class of the Delaware Emerging
Markets Fund and 1.00% for each class of the Delaware Global Bond Fund, of the
average daily net assets for the Fund through January 31, 2001.
The Fund has engaged Delaware Service Company, Inc. ("DSC"), an affiliate of
DMC, to provide dividend disbursing, transfer agent and accounting and
administrative services. Each Fund pays DSC a monthly fee based on the number of
shareholder accounts, shareholder transactions and average net assets, subject
to certain minimums.
43
<PAGE>
- --------------------------------------------------------------------------------
Notes to Financial Statements (Continued)
On November 30, 1999, the Fund had liabilities payable to affiliates as follows:
<TABLE>
<CAPTION>
Delaware Delaware Delaware Delaware
International Global Emerging Global
Equity Equity Markets Bond
Fund Fund Fund Fund
--------------------------------------------------
<S> <C> <C> <C> <C>
Investment management fee payable to DIAL ............ $191,199 $433 -- $698
Dividend disbursing, transfer agent, accounting fees
and other expenses payable to DSC .................. 32,071 12,296 $5,786 3,764
Other expenses payable to DMC and affiliates ......... 59,134 12,743 14,279 11,436
</TABLE>
Pursuant to the Distribution Agreement, each Fund 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 to waive its
fees to ensure that the annual fee received from the Delaware Emerging Markets
Fund A Class does not exceed 0.25% of the average daily net assets.
For the year ended November 30, 1999, DDLP earned commissions on sales of the A
Class shares for each Fund as follows:
<TABLE>
<CAPTION>
Delaware Delaware Delaware Delaware
International Global Emerging Global
Equity Equity Markets Bond
Fund Fund Fund Fund
-----------------------------------------------
<S> <C> <C> <C> <C>
$42,547 $5,166 $3,998 $1,959
</TABLE>
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, 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
International Global Emerging Global
Equity Equity Markets Bond
Fund Fund Fund Fund
-----------------------------------------------
<S> <C> <C> <C> <C>
Purchases ............................................ $8,444,858 $4,871,750 $3,185,139 $13,757,733
Sales ................................................ 102,249,525 7,043,525 1,951,260 13,889,450
</TABLE>
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
International Global Emerging Global
Equity Equity Markets Bond
Fund Fund Fund Fund
-------------------------------------------------
<S> <C> <C> <C> <C>
Cost of investments .................................. $218,772,984 $15,249,504 $19,776,007 $18,992,564
=================================================
Aggregate unrealized appreciation .................... $68,494,059 $2,289,805 $1,430,319 $13,989
Aggregate unrealized depreciation .................... (19,022,437) (1,314,143) (5,175,821) (1,603,657)
-------------------------------------------------
Net unrealized appreciation (depreciation) ........... $49,471,622 $975,662 ($3,745,502)($1,589,668)
=================================================
</TABLE>
For federal income tax purposes, the Fund had accumulated capital losses at
November 30, 1999 for each Fund as follows:
<TABLE>
<CAPTION>
Year of Year of
Expiration Expiration
2006 2007 Total
-----------------------------------
<S> <C> <C> <C>
Delaware Emerging Markets Fund ....................... $1,188,491 $829,324 $2,017,815
Delaware Global Bond Fund ............................ -- 139,057 139,057
</TABLE>
44
<PAGE>
- --------------------------------------------------------------------------------
4. Capital Stock
Transactions in capital stock shares were as follows:
<TABLE>
<CAPTION>
Delaware International Delaware Global
Equity Fund Equity Fund
----------------------------------------------------
Year Ended November 30,
1999 1998 1999 1998
Shares sold:
<S> <C> <C> <C> <C>
A Class ................................................... 33,398,322 16,564,864 229,260 176,582
B Class ................................................... 2,455,859 4,073,265 85,012 101,799
C Class ................................................... 9,364,208 7,476,066 33,512 54,271
Institutional Class ....................................... 4,633,814 8,697,007 22,319 39,144
Shares issued upon reinvestment of distributions from
net investment income and net realized gain on investments:
A Class ................................................... 114,367 275,722 32,898 58,833
B Class ................................................... 20,438 60,552 20,899 34,726
C Class ................................................... 5,755 20,437 13,217 22,924
Institutional Class ....................................... 192,795 207,907 5,855 21,063
----------------------------------------------------
50,185,558 37,375,820 442,972 509,342
----------------------------------------------------
Shares repurchased:
A Class ................................................... (35,339,072) (16,518,776) (242,326) (190,149)
B Class ................................................... (2,649,551) (3,853,029) (120,242) (56,458)
C Class ................................................... (9,398,225) (7,386,503) (97,899) (48,156)
Institutional Class ....................................... (8,445,453) (3,016,912)) (128,316) (31,084)
----------------------------------------------------
(55,832,301) (30,775,220) (588,783) (325,847)
----------------------------------------------------
Net increase (decrease) ...................................... (5,646,743) 6,600,600 (145,811) 183,495
====================================================
</TABLE>
<TABLE>
<CAPTION>
Delaware Emerging Delaware Global
Markets Fund Bond Fund
----------------------------------------------------
Year Ended November 30,
1999 1998 1999 1998
Shares sold:
<S> <C> <C> <C> <C>
A Class ................................................... 535,345 415,378 127,716 113,649
B Class ................................................... 261,161 123,871 111,137 34,421
C Class ................................................... 103,080 58,715 44,496 4,332
Institutional Class ....................................... 320,785 138,485 317,159 393,104
Shares issued upon reinvestment of distributions from
net investment income and net realized gain on investments:
A Class ................................................... 9,187 56,786 15,919 11,830
B Class ................................................... 599 21,543 7,490 2,915
C Class ................................................... 225 8,341 3,081 2,026
Institutional Class ....................................... 2,585 12,171 65,051 52,808
----------------------------------------------------
1,232,967 835,290 692,049 615,085
----------------------------------------------------
Shares repurchased:
A Class ................................................... (429,070) (563,918) (177,317) (120,563)
B Class ................................................... (193,250) (97,215) (62,611) (28,855)
C Class ................................................... (44,042) (79,781) (28,620) (22,294)
Institutional Class ....................................... (148,543) (167,165) (397,705) (305,570)
----------------------------------------------------
(814,905) (908,079) (666,253) (477,282)
----------------------------------------------------
Net increase (decrease) ...................................... 418,062 (72,789) 25,796 137,803
====================================================
</TABLE>
45
<PAGE>
Notes to Financial Statements (Continued)
- --------------------------------------------------------------------------------
5. Lines of Credit
The following Funds have a committed line of credit for the following amounts:
Delaware International Equity Fund ................... $9,800,000
Delaware Global Equity Fund .......................... 600,000
Delaware Emerging Markets Fund ....................... 800,000
Delaware Global Bond Fund ............................ 1,100,000
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 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 Fund 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, 1999:
<TABLE>
<CAPTION>
Value of Unrealized
Contract at Appreciation
Contracts to Deliver In Exchange For 11/30/99 Settlement Date (Depreciation)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Delaware Global Bond Fund
140,712 Canadian Dollars ..................... $95,918 $95,560 12/1/99 $358
Delaware Global Equity Fund
89,833 British Pounds ........................ $143,777 $143,679 12/3/99 $98
164,504 European Monetary Units .............. $166,774 $165,894 12/1/99 $880
</TABLE>
7. Market and Credit Risk
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 a 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.
The Fund may invest in high-yield fixed income securities which carry ratings of
BB or lower by S&P and/or Ba or lower by Moody's. 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 Delaware Emerging Markets Fund each Fund 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 Delaware Emerging Markets Fund may
invest up to 15% in such securities. The relative
46
<PAGE>
- --------------------------------------------------------------------------------
illiquidity of some of these securities may adversely affect the Funds' ability
to dispose of such securities in a timely manner and at a fair price when it is
necessary to liquidate such securities.
8. Securities Lending
The Delaware International Equity Fund 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 & Poor's Ratings Group or Moody's 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 collateral received is insufficient to
cover the value of 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 Fund, 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, 1999 were as follows:
<TABLE>
<CAPTION>
Market value Market Income earned
of securities value of for the year ended
on loan collateral 11/30/99*
-----------------------------------------------------------
<S> <C> <C> <C>
Delaware International Equity Fund $29,136,736 $31,244,630 $176,648
</TABLE>
* Included in interest income in the Statement of Operations.
9. Subsequent event
Each Fund declared dividends from net investment income and distributions from
net realized gain on investments payable December 28, 1999, to shareholders of
record December 21, 1999. Distributions from net realized gain on investments
for all classes were as follows:
<TABLE>
<CAPTION>
Delaware Delaware Delaware Delaware
International Global Emerging Global
Equity Equity Markets Bond
Fund Fund Fund Fund
-----------------------------------------------------------
<S> <C> <C> <C> <C>
$0.322 $0.550 -- --
</TABLE>
10. Tax Information (Unaudited)
The information set forth below is for each Fund's fiscal year as required by
federal laws. Shareholders, 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 ended November 30, 1999, each Fund designates as long-term
capital gains and ordinary income distributions paid during the year as follows:
<TABLE>
<CAPTION>
(A)* (B)* (C) (D)**
Long Term Capital Ordinary Income Total Qualifying
Gains Distributions Distributions Distributions Dividends (1)
Fund (Tax Basis) (Tax Basis) (Tax Basis)
-----------------------------------------------------------------
<S> <C> <C> <C> <C>
Delaware International Equity Fund -- 100% 100% --
Delaware Global Equity Fund 77% 23% 100% 30%
Delaware Emerging Markets Fund -- 100% 100% --
Delaware Global Bond Fund 12% 88% 100% --
</TABLE>
* Items (A) and (B) are based on a percentage of the fund's total
distributions.
** Item (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.
47
<PAGE>
Notes to Financial Statements (Continued)
- --------------------------------------------------------------------------------
The amount per share of income from the foreign taxes paid to each country is
listed in the following schedule (unaudited):
Delaware International Equity Fund
Gross Dividend Foreign Taxes
Country Per Share Paid Per Share
-----------------------------------
Australia .............................. $0.0864 $0.0057
Belgium ................................ 0.0149 0.0022
Germany ................................ 0.0445 0.0048
France ................................. 0.0462 0.0070
Hong Kong .............................. 0.0282 --
Japan .................................. 0.0264 0.0040
Malaysia ............................... 0.0013 --
Netherlands ............................ 0.0739 0.0115
New Zealand ............................ 0.0364 0.0055
Spain .................................. 0.0148 0.0024
United Kingdom ......................... 0.2145 0.0200
United States .......................... 0.0097 --
-----------------------------------
$0.5972 $0.0631
-----------------------------------
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 International Equity Fund, Delaware
Global Equity Fund, Delaware Emerging Markets Fund and Delaware Global Bond
Fund) (the "Funds") as of November 30, 1999, 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, 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, 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 each of the periods indicated therein, in
conformity with generally accepted accounting principles.
/s/ Ernst & Young LLP
Philadelphia, Pennsylvania
January 7, 2000
48
<PAGE>
DELAWARE INVESTMENTS FAMILY OF FUNDS
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.
[GRAPHIC OMITTED: BUILDING BLOCKS OF A DIVERSIFIED PORTFOLIO "HOUSE"]
Building Blocks of a Diversified Portfolio
GROWTH OF CAPITAL
Aggressive Growth Equity Funds
Growth Equity Funds
o Select Growth Fund
o Trend Fund
o DelCap Fund
o Small Cap Value Fund
o U.S. Growth Fund
o Growth Stock Fund
o Tax-Efficient Equity Fund
o Social Awareness Fund
TOTAL RETURN
Moderate Growth Equity Funds
o Blue Chip Fund
o Devon Fund
o Growth and Income Fund
o Decatur Equity Income Fund
o REIT Fund
o Balanced Fund
INTERNATIONAL AND GLOBAL
International and Global Funds
o Emerging Markets Fund
o New Pacific Fund
o Overseas Equity Fund
o International Equity Fund
o Global Equity Fund
o Global Bond Fund
CURRENT INCOME
Taxable Bond Funds
o Delchester Fund
o High-Yield Opportunities Fund
o Strategic Income Fund
o Corporate Bond Fund
o Extended Duration Bond Fund
o American Government Bond Fund
o U.S. Government Securities Fund
o Limited-Term Government Fund
TAX-EXEMPT INCOME
Tax-Exempt Bond Funds
o National High-Yield Municipal Bond Fund
o Tax-Free USA Fund
o Tax-Free Insured Fund
o Tax-Free USA Intermediate Fund
o State Tax-Free Funds*
STABILITY OF PRINCIPAL
Stability of Principal
o Cash Reserve
o Tax-Free Money Fund
ASSET ALLOCATION
Asset Allocation Funds
(varying levels of income and growth potential)
o Foundation Funds
Growth Portfolio
Balanced Portfolio
Income Portfolio
(C)Delaware Distributors, L.P.
* Available for the following states: Arizona, California, Colorado, Florida,
Idaho, Iowa, Kansas, Minnesota, Missouri, Montana, North Dakota, New Jersey,
New Mexico, New York, Ohio, Oregon, Pennsylvania and Wisconsin. Insured and
intermediate bond funds are available in selected states.
<PAGE>
For Shareholders
DELAWARE(SM) 1.800.523.1918
INVESTMENTS
- ---------------------
Philadelphia o London For Securities Dealers
1.800.362.7500
For Financial Institutions
Representatives Only
1.800.659.2265
www.delawareinvestments.com
This annual report is for the information of Delaware International Equity Fund,
Delaware Global Equity Fund, Delaware Emerging Markets Fund and Delaware Global
Bond Fund shareholders, but it may be used with prospective investors when
preceded or accompanied by a current Prospectus for Delaware International
Equity Fund, Delaware Global Equity Fund, Delaware Emerging Markets Fund and
Delaware Global Bond Fund and the Delaware Investments Performance Update for
the most recently completed calendar quarter. The prospectus sets 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.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
BOARD OF TRUSTEES
<S> <C> <C>
Wayne A. Stork Charles E. Peck Investment Manager
Chairman Secretary/Treasurer, Enterprise Homes, Inc. Delaware Management Company
Delaware Investments Family of Funds Fredericksburg, VA Philadelphia, Pennsylvania
Philadelphia, PA
Jan L. Yeomans Sub-advisor and International Affiliate
Vice President and Treasurer Delaware International Advisers Ltd.
Walter P. Babich 3M Corporation London, England
Board Chairman, Citadel Constructors, Inc. St. Paul, Minnesota
King of Prussia, PA National Distributor
AFFILIATED OFFICERS Delaware Distributors, L.P.
David K. Downes Philadelphia, Pennsylvania
President and Chief Executive Officer Richard J. Flannery
Delaware Investments Family of Funds Executive Vice President Shareholder Servicing, Dividend
Philadelphia, PA and General Counsel Disbursing and Transfer Agent
Delaware Investments Family of Funds Delaware Service Company, Inc.
John H. Durham Philadelphia, PA Philadelphia, Pennsylvania
Partner, Complete Care Services
Horsham, PA Bruce D. Barton 1818 Market Street
President and Chief Executive Officer Philadelphia, PA 19103-3682
Anthony D. Knerr Delaware Distributors, L.P.
Consultant, Anthony Knerr & Associates Philadelphia, PA
New York, NY
Ann R. Leven
Former Treasurer, National Gallery of Art
Washington, DC
Thomas F. Madison
President and Chief Executive Officer
MLM Partners, Inc.
Minneapolis, MN
</TABLE>
Printed in the USA
(2530) J5406
AR-034 [11/99] PPL 01/00
