<PAGE>
ANNUAL REPORT | October 31, 2000
The Strong
International
--------------------------------------------------------------------------------
Funds
[PHOTO HERE]
Strong Asia Pacific Fund
Strong Foreign MajorMarkets(SM) Fund
Strong International Stock Fund
Strong Overseas Fund
Strong International Bond Fund
Strong Short-Term Global Bond Fund
[LOGO HERE] STRONG
<PAGE>
A Few Words From Dick Strong
--------------------------------------------------------------------------------
[PHOTO HERE]
153 Rate Increases Later...
When Will the Pendulum Swing?
During the last 18 months, the central bankers of the world's most powerful
countries have had one overriding objective on their minds: to slow the economic
growth of their countries. To accomplish this objective, they have raised
interest rates around the globe a staggering total of 153 times.
Included in those 153 rate increases were 6 by the Federal Reserve Bank of the
United States. The Fed governors' objective was the same as their counterparts'
worldwide--to slow economic growth. And make no mistake...THEY WILL NOT FAIL!
Economic management is a nebulous process of leads and lags. It often takes
months or even years to get an accurate fix on the economy and gauge the
reaction to each action. It is an inexact cross between art and science.
In the last year and a half, the U.S. economy has contended with:
. Higher interest rates
. Oil selling upwards of $30 a barrel
. A strong U.S. dollar that rendered American goods and services more
expensive and less attractive to foreigners
. The erosion of wealth caused by a nearly 40% correction in the Nasdaq
The end result of it all is less money circulating through our economy and a
slowing of economic growth.
We have already begun to see signs of a weakening economy. Sales falling short
of expectations, layoffs, disappointing corporate profits, and business failures
all point to a slowdown. How much more weakening lies ahead is impossible to
know. The combination of higher interest rates, expensive oil, the strong U.S.
dollar, and further market corrections could deliver one heck of a wallop!
The lesson to be learned from all of this is that the world's financial markets
and economies are inherently cyclical. There will always be good times and bad
times, booms and busts. A solid investment program must be built to withstand
the stress of expanding and contracting economic cycles.
At Strong, our research indicates that sometime soon, the central bankers of the
world will begin to actively stimulate their respective economies by easing up
on interest rates. The internal fabric of the U.S. economy remains the best it
has been in several decades. We believe that the economy and the financial
markets will once again begin to grow and prosper in late 2001 and 2002.
The financial markets have recently had a significant correction reminiscent of
1973-74. The stock market is usually an early indicator of economic strength or
weakness and will begin to move long before earnings, job reports, and business
activity catch up.
The important thing for investors to remember is not to react to whatever the
most recent stimulus has been, but to have a well-thought-out plan to reach
their objectives--and to stay the course with that plan. At Strong, we continue
to believe, as we did back in 1975, that a balanced approach to investing can
serve you and your family well. Our recommendation continues to be that
investors should construct a balanced portfolio of money funds, bond mutual
funds, and stock mutual funds.
/s/ Dick
<PAGE>
The Strong International Funds
----------
ANNUAL REPORT | October 31, 2000
Table of Contents
<TABLE>
<S> <C>
Investment Reviews
Strong Asia Pacific Fund......................................... 2
Strong Foreign MajorMarkets(SM) Fund............................. 4
Strong International Stock Fund.................................. 6
Strong Overseas Fund............................................. 8
Strong International Bond Fund................................... 10
Strong Short-Term Global Bond Fund............................... 12
Financial Information
Schedules of Investments in Securities
Strong Asia Pacific Fund.................................... 14
Strong Foreign MajorMarkets(SM) Fund........................ 14
Strong International Stock Fund............................. 15
Strong Overseas Fund........................................ 16
Strong International Bond Fund.............................. 17
Strong Short-Term Global Bond Fund.......................... 18
Statements of Assets and Liabilities............................. 21
Statements of Operations......................................... 23
Statements of Changes in Net Assets.............................. 25
Notes to Financial Statements.................................... 28
Financial Highlights ............................................... 32
Report of Independent Accountants .................................. 35
</TABLE>
<PAGE>
Strong Asia Pacific Fund
Your Fund's Approach
The Strong Asia Pacific Fund seeks capital growth. The Fund invests primarily in
stocks from companies located in Asia or the Pacific Basin. The Fund's manager
looks for companies with potential for above-average sales and earnings growth,
overall financial strength, competitive advantages, and capable management.
Growth of an Assumed $10,000 Investment
From 12-31-93 to 10-31-00
[GRAPH]
<TABLE>
<CAPTION>
The Srong Asia Lipper Pacific
Pacific Fund MSCI AP* Region Funds Index*
<S> <C> <C> <C>
Dec 93 $10,000 $10,000 $10,000
Dec 94 $ 9,472 $ 8,771 $ 9,474
Dec 95 $10,034 $ 9,305 $ 9,728
Dec 96 $10,246 $10,388 $ 9,994
Dec 97 $ 7,070 $ 6,834 $ 7,278
Dec 98 $ 6,849 $ 6,532 $ 7,063
Dec 99 $13,426 $ 9,788 $12,597
Oct 00 $ 8,803 $ 6,967 $ 8,699
</TABLE>
This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Morgan Stanley Capital International AC Asia Pacific Free ex. Japan Index ("MSCI
AP") and the Lipper Pacific Region Funds Index. Results include the reinvestment
of all dividends and capital gains distributions. Performance is historical and
does not represent future results. Investment returns and principal value vary,
and you may have a gain or loss when you sell shares.
Q: How did your fund perform?
A: This one-year period has been marked by considerable volatility in the
markets in which we invest, and, regrettably, the Fund has experienced this
volatility. After beginning the year strongly, shooting up ahead of the
index and most of its peers in November and December 1999, this
outperformance continued well into 2000, with the Fund still in positive
territory at the end of April of this year. Most of the damage the Fund
sustained actually came in a relatively short period, mainly May and June.
Since then, the Fund, though slipping further, has defended itself
comparatively well against many savage falls among the Asian markets.
Q: What market conditions, market events, and other factors impacted your
fund's performance?
A: The first couple of months of the one-year period constituted the end of
the first phase of an overdue recovery from several years of economic woes
in the Asian region. In retrospect, this recovery had become overheated by
the end of 1999. The huge bounce in stock prices had run ahead of the very
real, but more moderate, improvement in fundamentals.
The result has been an overcorrection on the downside so far in the year
2000. At the end of October, all Asian markets were down for the calendar
year. The best, such as Australia, Japan, and Thailand, fell from 20% to
30%, while the worst, including the Philippines, South Korea, and
<PAGE>
Taiwan, plunged as much as 40% to 50%.
A number of external factors contributed to the region's stumble. Most
damaging have been rising U.S. interest rates, weakness and volatility in
the technology and Internet sectors, and higher oil prices.
Q: What investment strategies and techniques impacted your fund's performance?
A: The portfolio strategies we have followed since the beginning of the
calendar year have, by necessity, unfortunately been about trying to
preserve capital and trying to make it grow. To that end, we have executed
a number of measures. One was to reduce further the number of holdings in
the Fund to an even tighter core group of investments in which we hold the
most confidence. We have also avoided some, though by no means all, damage
by our market weightings. We had very little exposure to hard-hit Taiwan
and Korea, and had significant weightings in comparatively stronger
Australia, Singapore, China, and Japan.
Finally, we have maintained a meaningful exposure to the energy sector,
predominantly in Australia, which has been supported by strong oil prices
and consequent merger and acquisition activity.
Q: What is your future outlook?
A: Some of the shadows overhanging the market are still in place, but others
are beginning to disperse. In many cases, Asian stock prices are back down
to levels that assume there have been no improvements in business or the
region's economy in the past couple of years--which is certainly not the
case.
We believe that once investors, both domestic and foreign, begin to
recognize the values the currently oversold situation offers to them, there
could be a resurgence of investor interest in the region. This would be a
replay of sorts of the situation we saw in 1993 and again in 1999, where
significant upswings followed excessively pessimistic periods for Asian
stocks.
--------------------------------------------------------------------------------
AVERAGE ANNUAL
TOTAL RETURNS
As of 10-31-00
1-year -16.22%
3-year 3.58%
5-year -1.96%
Since Inception -1.85%
(12-31-93)
Equity funds are volatile investments and should only be considered for long-
term goals.
--------------------------------------------------------------------------------
Thank you for your investment in the Strong Asia Pacific Fund.
Anthony Cragg
Portfolio Manager
* The Morgan Stanley Capital International AC Asia Pacific Free ex. Japan
Index ("MSCI AP") is an unmanaged index generally representative of
developed and emerging markets in the Asia/Pacific region, excluding Japan.
MSCI AP data is U.S. dollar-adjusted. The Lipper Pacific Region Funds Index
is an equally weighted performance index of the largest qualifying funds in
this Lipper category. Source of the MSCI index data is Standard & Poor's
Micropal. Source of the Lipper index data is Lipper Inc.
3
<PAGE>
Strong Foreign Major Markets(SM) Fund
Your Fund's Approach
The Strong Foreign Major Markets(SM) Fund seeks capital growth. The Fund invests
primarily in stocks issued by companies in the countries represented in the MSCI
EAFE Index.* The Fund's manager employs a disciplined, quantitative approach to
identify undervalued foreign stocks. The manager then analyzes these stocks to
make final selections. To manage foreign currency risk, the manager may hedge a
portion of the Fund's exposure to currency fluctuations.
GROWTH OF AN ASSUMED $10,000 INVESTMENT
FROM 6-30-98 TO 10-31-00
<TABLE>
<CAPTION>
The Strong Foreign MSCI EAFE* Lipper International
MajorMarkets(SM) Fund Funds Index*
<S> <C> <C> <C>
Jun 98 $10,000 $10,000 $10,000
Aug 98 $ 8,760 $ 8,849 $ 8,692
Dec 98 $ 9,980 $10,351 $ 9,728
Apr 99 $10,860 $10,920 $10,311
Aug 99 $11,230 $11,122 $10,715
Dec 99 $14,210 $13,142 $13,408
Apr 00 $13,226 $12,437 $12,635
Aug 00 $12,469 $12,184 $12,650
Oct 00 $10,966 $11,317 $11,509
</TABLE>
This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Morgan Stanley Capital International Europe, Australasia, and Far East Index
("MSCI EAFE") and the Lipper International Funds Index. Results include the
reinvestment of all dividends and capital gains distributions. Performance is
historical and does not represent future results. Investment returns and
principal value vary, and you may have a gain or loss when you sell shares.
Q: How did your fund perform?
A: Performance suffered because we continued to hold on to our winners from
1999 and the first quarter of 2000. Moreover, the troubles afflicting U.S.
technology companies hurt some of our technology holdings by association.
Most of the negative impact came in September, when several U.S. companies
preannounced lower-than-expected growth in revenues and profits.
Q: What market conditions, market events, and other factors impacted your
fund's performance?
A: Over the period, four factors were the movers and shakers driving
international markets: rising oil prices, the weakness of the euro relative
to the U.S. dollar and the Japanese yen, earnings warnings from U.S.
technology companies, and the hawkish stance of the U.S. Federal Reserve.
Q: What investment strategies and techniques impacted your fund's performance?
A: On the whole, there was perhaps more inaction than action. We did reduce
our position in technology, media, and telecommunications ("TMT") stocks in
April and May, targeting those that we deemed to be pure new-economy
companies. Since making that change in the spring, however, we have kept
our TMT weighting steady.
4
<PAGE>
Because of Hong Kong's rising interest rates, we eliminated our real estate
stocks from that country. In their place, we bought back a few old-economy
stocks that we believed retained healthy growth potential. These stocks
included petroleum giant BP Amoco, defense systems provider British
Aerospace, Swiss pharmaceutical company Novartis, and French hotel company
Accor. Investments within the initial public offering market also
contributed meaningfully to our performance. Consistent with the Fund's
strategy, our country and industry weightings closely track those of the
MSCI EAFE Index.*
Q: What is your future outlook?
A: It's our view that for global markets to rebound, there must be positive
developments in the four mover-and-shaker issues discussed earlier. For oil
prices, we see signs that optimism is warranted. Developed nations appear
determined to put a ceiling on oil prices by taking steps such as releasing
oil reserves.
With regard to the euro, our outlook is neutral. The unified European
currency is unlikely to enjoy the stature it held at its 1999 inception,
but we believe a floor has been set on its value and central banks have
been willing to shore it up.
We are not unduly troubled by profit warnings from the likes of Intel,
Apple, and Dell. These seemed to have a common theme--namely, disappointing
August and September European sales. This weakness appeared to be temporary
in nature, however, and did not reflect vanishing demand. A final positive
sign is that it appears the threat of rising interest rates from the U.S.
Federal Reserve is over.
Q: Are there any further considerations for overseas markets?
A: We would like investors to recognize that despite short-term difficulties,
we believe the world's economies remain safe and sound. Political leaders
continue to focus on raising the standard of living for their citizens--a
longer-term trend with more power behind it than the recent short-term
hiccups in the marketplace.
Some stocks in the market were, however, overvalued. These were deservedly
punished when they fell short of lofty expectations. We now believe that
most companies are fairly priced and, in some cases, undervalued.
--------------------------------------------------------------------------------
AVERAGE ANNUAL
TOTAL RETURNS
As of 10-31-00
1-year -6.91%
Since Inception 4.03%
(6-30-98)
Equity funds are volatile investments and should only be considered for long-
term goals.
--------------------------------------------------------------------------------
We remain impressed by the opportunities available to multinational
corporations in the developing economies of China and India. These have the
potential to counteract the impact of any economic slowdowns in developed
markets. It is our hope that the World Trade Organization can promote a new
phase of sustained economic growth anchored by the two most populous
countries on earth.
Thank you for your investment in the Strong Foreign MajorMarkets(SM) Fund.
David Lui
Portfolio Manager
* The MSCI EAFE is an unmanaged index generally representative of major
overseas stock markets. MSCI EAFE data is U.S. dollar-adjusted. The Lipper
International Funds Index is an equally weighted performance index of the
largest qualifying funds in this Lipper category. Source of the MSCI index
data is Standard & Poor's Micropal. Source of the Lipper index data is
Lipper Inc.
5
<PAGE>
Strong International Stock Fund
Your Fund's Approach
The Strong International Stock Fund seeks capital growth. The Fund selects
stocks from any foreign country. The manager seeks stocks that appear to have
strong growth potential relative to their risk using a three-step investment
process involving country allocation, intensive in-house research, and currency
management. The manager examines the economic outlook of individual countries in
determining whether to invest and chooses individual stocks based on rigorous,
in-depth analysis, which may include interviews with company leaders.
GROWTH OF AN ASSUMED $10,000 INVESTMENT
FROM 3-4-92 TO 10-31-00
[GRAPH]
<TABLE>
<CAPTION>
The Stong
International MSCI EAFE* Lipper International
Stock Fund Funds Index*
<S> <C> <C> <C>
Mar 92 $10,000 $10,000 $10,000
Dec 92 $ 9,819 $ 9,484 $ 9,494
Dec 93 $14,507 $12,572 $13,215
Dec 94 $14,282 $13,549 $13,118
Dec 95 $15,399 $15,068 $14,432
Dec 96 $16,659 $15,979 $16,515
Dec 97 $14,293 $16,263 $17,712
Dec 98 $13,287 $19,516 $19,954
Dec 99 $25,599 $24,778 $27,504
Oct 00 $18,103 $21,338 $23,608
</TABLE>
This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Morgan Stanley Capital International Europe, Australasia, and Far East Index
("MSCI EAFE") and the Lipper International Funds Index. Results include the
reinvestment of all dividends and capital gains distributions. Performance is
historical and does not represent future results. Investment returns and
principal value vary, and you may have a gain or loss when you sell shares. To
equalize the time periods, the indexes' performances were prorated for the month
of March 1992.
Q: How did your fund perform?
A: Performance suffered because we continued to hold on to our winners from
1999 and the first quarter of 2000. Moreover, some of our technology
companies were punished by association with troubled U.S. technology
companies. The Fund's difficulties were concentrated in the month of
September, when many U.S. companies preannounced lower-than-expected growth
in revenues and profits.
Q: What market conditions, market events, and other factors impacted your
fund's performance?
A: There were four prime movers and shakers: rising oil prices, the weakness
of the euro relative to the U.S. dollar and the Japanese yen, earnings
warnings from U.S. technology companies, and, to a lesser degree, the
hawkish stance of the U.S. Federal Reserve.
Q: What investment strategies and techniques impacted your fund's performance?
A: This year, the portfolio was noted more for inaction than action. In April
and May, we did reduce our technology, media, and telecommunications
("TMT") weightings. Specifically, we eliminated the stocks--representing 5%
to 7% of the portfolio--that we deemed to be strictly new economy issues.
These included EM TV, Terra Networks, PT Multimedia, Jazztel, OpenTV,
Global Telesystems, and Pacific Century
6
<PAGE>
Cyberworks. Since making that change, however, we have kept our TMT
weighting steady.
We also eliminated our Hong Kong real estate stocks in light of that
market's rising interest rate environment. In their place, we bought back a
few old-economy stocks that were beaten down but that we believed retained
healthy growth potential. These stocks included petroleum giant BP Amoco,
defense systems provider British Aerospace, Swiss pharmaceutical company
Novartis, and French hotel company Accor. Investments within the initial
public offering market also contributed meaningfully to our performance. We
are not bullish on any one specific region, so our country weightings track
those of the MSCI EAFE Index.*
Q: What is your future outlook?
A: The ability of global markets to rebound depends on the four
mover-and-shaker issues identified previously. With regard to oil prices,
developed nations appear determined to put a ceiling on oil prices by
taking steps such as releasing oil reserves. We see reason for optimism,
though a warm winter would help.
While the euro is unlikely to regain the glory it held at its 1999
inception, we believe a floor has been set on the currency, and our
position with regard to it is neutral.
The profit warnings from the likes of Intel, Apple, and Dell seemed to have
a common theme--weak August and September sales in Europe. We believe,
however, that demand did not disappear; it merely took a short break.
Despite revenue and profit warnings from a few U.S. technology stalwarts,
about 70% of U.S. companies reported third-quarter 2000 earnings in excess
of expectations.
Also, it appears the threat of rising interest rates from the U.S. Federal
Reserve is over.
Q: Are there any further considerations for overseas markets?
A: Overall, it's important to remember that despite short-term difficulties,
we believe the world is safe and sound. Political leaders continue to focus
on raising the standard of living for their citizens. A pause of one or two
months by no means suggests the impending return of the Dark Ages.
We must admit that some stocks were priced for perfection and deserved to
be punished when expectations were not met. However, after surveying the
valuations of a diversified group of companies, we believe most of them are
fairly priced or even undervalued.
--------------------------------------------------------------------------------
AVERAGE ANNUAL
TOTAL RETURNS
As of 10-31-00
1-year 3.00%
3-year 5.71%
5-year 4.12%
Since Inception 7.10%
(3-4-92)
Equity funds are volatile investments and should only be considered for long-
term goals.
--------------------------------------------------------------------------------
The opportunities available to the multinationals in the huge developing
economies of China and India have the potential to more than compensate for
any slowdown in developed countries. Let us hope that the World Trade
Organization can usher in a new phase of sustained economic growth anchored
by the two most populous countries in the world.
Thank you for your investment in the Strong International Stock Fund.
David Lui
Portfolio Manager
* The MSCI EAFE is an unmanaged index generally representative of major
overseas stock markets. MSCI EAFE data is U.S. dollar-adjusted. The Lipper
International Funds Index is an equally weighted performance index of the
largest qualifying funds in this Lipper category. Source of the MSCI index
data is Standard & Poor's Micropal. Source of the Lipper index data is
Lipper Inc.
7
<PAGE>
Strong Overseas Fund
Your Fund's Approach
The Strong Overseas Fund seeks capital growth. The Fund invests in stocks from
ten or more foreign countries. The manager seeks stocks that appear to have
strong growth potential relative to their risk using a three-step investment
process involving country allocation, intensive in-house research, and currency
management. The manager examines the economic outlook of individual countries in
determining whether to invest and chooses individual stocks based on rigorous,
in-depth analysis, which may include interviews with company leaders. At times,
the Fund may take larger positions in companies and countries that may present
greater potential investment opportunities.
GROWTH OF AN ASSUMED $10,000 INVESTMENT
FROM 6-30-98 TO 10-31-00
<TABLE>
<CAPTION>
Lipper
The Strong MSCI EAFE* International
Overseas Fund Funds Index*
<S> <C> <C> <C>
Jun 98 $10,000 $10,000 $10,000
Aug 98 $ 9,290 $ 8,849 $ 8,692
Dec 98 $10,460 $10,351 $ 9,728
Apr 99 $11,420 $10,920 $10,311
Aug 99 $12,800 $11,122 $10,715
Dec 99 $20,530 $13,142 $13,408
Apr 00 $19,310 $12,437 $12,635
Aug 00 $18,520 $12,184 $12,650
Oct 00 $15,170 $11,317 $11,509
</TABLE>
This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Morgan Stanley Capital International Europe, Australasia, and Far East Index
("MSCI EAFE") and the Lipper International Funds Index. Results include the
reinvestment of all dividends and capital gains distributions. Performance is
historical and does not represent future results. Investment returns and
principal value vary, and you may have a gain or loss when you sell shares.
Q: How did your fund perform?
A: We continued to hold on to some of our winning stocks from 1999 and the
first quarter of 2000, which hampered performance later in the fiscal year.
In particular, some of our technology holdings saw their prices knocked
down not so much because of any weaknesses of their own, but more because
of their association with troubled U.S. technology companies. The Fund's
difficulties were concentrated in the month of September, when several U.S.
technology companies preannounced lower-than-expected growth in revenues
and profits.
Q: What market conditions, market events, and other factors impacted your
fund's performance?
A: Four prime movers and shakers drove the performance of international
markets and the Fund over the past year: rising oil prices, the weakness of
the euro relative to the U.S. dollar and the Japanese yen, earnings
warnings from U.S. technology companies, and, to a lesser degree, the
hawkish stance of the U.S. Federal Reserve.
Q: What investment strategies and techniques impacted your fund's performance?
A: We have begun to pull this portfolio back from some of its concentrated
positions, though we are making this change gradually in an effort to avoid
negative impacts from the change. In April and May, we reduced our
technology, media, and
8
<PAGE>
telecommunications ("TMT") weightings. Specifically, we eliminated the
stocks--representing 5% to 7% of the portfolio--that we deemed to be
strictly new-economy issues. Since making that change, however, we have
kept our TMT weighting steady.
We also eliminated our Hong Kong real estate stocks in light of that
market's rising interest rate environment. In their place, we bought back a
few old-economy stocks that were beaten down but that we believed retained
healthy growth potential. These stocks include petroleum giant BP Amoco,
Swiss pharmaceutical company Novartis, and French hotel company Accor.
Investments within the initial public offering market also contributed
meaningfully to our performance. We are not bullish on any one specific
region, so our country weightings track those of the MSCI EAFE Index.*
Q: What is your future outlook?
A: In order for global markets to rebound, there will need to be positive
developments in the four mover-and-shaker issues identified previously. We
see reason for optimism with regard to oil prices, as developed nations
appear determined to put a ceiling on oil prices by taking steps such as
releasing oil reserves.
Although we don't believe we'll see the euro restored to the glory that
marked its inception, we do believe a floor has been set on the currency.
Profit warnings from the likes of Intel, Apple, and Dell all seemed to stem
largely from reduced European demand in August and September. It appears to
us that this was only a temporary situation, exacerbated by trucker strikes
and oil-supply issues in the region.
Also, it appears the threat of rising interest rates from the U. S. Federal
Reserve is over. That said, we don't believe an easing of rates is at all
imminent.
Q: Are there any further considerations for overseas markets?
A: Above all, we would ask investors to remember that despite short-term
problems, on the whole, we believe the world is safe and its economies
sound. Raising the standard of living continues to be a priority for
political leaders, and these efforts carry more weight than do a difficult
month or two.
Many of the stocks whose prices were battered had been priced for
perfection--so, when they fell short of those expectations, it was
reasonable for their prices to be taken down. At this point, we believe the
markets are populated by a high proportion of stocks that are fairly
valued, or even underpriced. Going forward, China and India should play a
large role in global growth. These huge economies have the capacity to
counteract slowdowns in other nations' economies.
--------------------------------------------------------------------------------
AVERAGE ANNUAL
TOTAL RETURNS
As of 10-31-00
1-year 5.57%
Since Inception 19.55%
(6-30-98)
Equity funds are volatile investments and should only be considered for long-
term goals.
--------------------------------------------------------------------------------
Thank you for your investment in the Strong Overseas Fund.
David Lui
Portfolio Manager
* The MSCI EAFE is an unmanaged index generally representative of major
overseas stock markets. MSCI EAFE data is U.S. dollar-adjusted. The Lipper
International Funds Index is an equally weighted performance index of the
largest qualifying funds in this Lipper category. Source of the MSCI index
data is Standard & Poor's Micropal. Source of the Lipper index data is
Lipper Inc.
9
<PAGE>
Strong International Bond Fund
Your Fund's Approach
The Strong International Bond Fund seeks high total return by investing for both
income and capital growth. The Fund invests primarily in higher- and
medium-quality bonds issued in foreign countries. The Fund may also invest up to
35% of its assets in lower-quality, high-yield bonds. The Fund maintains an
average maturity of four to nine years. To select bonds, the Fund's managers
first look at overall trends in the global economy. The managers then examine
the countries, sectors, and individual companies that may benefit from those
trends. The managers may create synthetic bonds to make investments consistent
with the Fund's strategy and goals.
GROWTH OF AN ASSUMED $10,000 INVESTMENT
FROM 3-31-94 TO 10-31-00
<TABLE>
<CAPTION>
Salamon Smith
Barney Non-U.S. Lipper
The Strong World Government International
International Bond Index Income Funds
Bond Fund (Currency Unhedged)* Index*
<S> <C> <C> <C>
Mar 94 $10,000 $10,000 $10,000
Dec 94 $10,865 $10,397 $ 9,836
Dec 95 $12,936 $12,429 $11,700
Dec 96 $13,966 $12,936 $12,783
Dec 97 $13,296 $12,385 $12,991
Dec 98 $15,329 $14,588 $14,724
Dec 99 $14,192 $13,849 $14,067
Oct 00 $12,981 $12,691 $13,473
</TABLE>
This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Salomon Smith Barney Non-U.S. World Government Bond Index (Currency Unhedged)
and the Lipper International Income Funds Index. Results include the
reinvestment of all dividends and capital gains distributions. Performance is
historical and does not represent future results. Investment returns and
principal value vary, and you may have a gain or loss when you sell shares.
Q: How did your fund perform?
A: The continued strength in the U.S. dollar led to the steady decline in
total return for the Fund. The Fund generally does not hedge its portfolio
against foreign currency exposure. Therefore, an appreciating U.S. dollar
has a negative impact on portfolio returns. Fluctuations in global interest
rates also contributed to the Fund's performance.
Q: What market conditions, market events, and other factors impacted your
fund's performance?
A: The Fund's return was influenced by two main factors: a strengthening U.S.
dollar and changes in interest rates. The U.S. dollar appreciated in value
versus other major currencies during the period, as U.S. growth continued
to outpace that in other economies.
Global interest rates ended the period mixed. Interest rates trended higher
at the beginning of the period, as world economic growth strengthened. Many
central banks, including the U.S. Federal Reserve and the European Central
Bank, raised short-term interest rates to slow this excessive growth.
During the second half of the fiscal year, global interest rates declined
as the more aggressive monetary policy began to slow the world economy.
U.S. ten-year Treasuries yielded approximately 5.75%, while German and
Japanese ten-year notes yielded roughly 5.2% and 1.8%, respectively.
10
<PAGE>
Q: What investment strategies and techniques impacted your fund's performance?
A: The Fund shortened its duration (a measure of the portfolio's sensitivity
to interest rate changes) early in the fiscal year as inflationary
pressures began to rise. The Fund currently is neutral overall in duration
versus its benchmark.
We have underweighted Japanese bonds, which we find unattractive due to
their low yields. The Fund was underweighted toward the euro, Europe's
unified currency, during the first half of the fiscal year. We lifted this
underweighting later in the year, however, as it appeared to us that the
sell-off in the euro was overdone and that issues exposed to it were now
more attractive. The G-7 (a summit of the "Group of Seven" global
superpowers) subsequently intervened and was successful in stabilizing the
euro, benefiting the portfolio. Overall, the Fund's exposures to foreign
currencies are in line with those of its benchmark.
The Fund continues to de-emphasize emerging markets and currently has no
holdings in that sector of the marketplace.
Q: What is your future outlook?
A: In the U.S., we are likely to experience a more stable interest rate
environment, as the economy's growth rate appears to be slowing and the Fed
is expected to be on hold in the near future.
European markets are still experiencing inflationary pressures, however, as
high oil prices and a weak euro continue to concern the European Central
Bank. We believe further interest rate hikes are likely in the region. In
Japan, bond yields will likely remain in a narrow range as that country's
central bank continues to attempt to stimulate domestic demand with a
near-zero interest rate policy.
Currency markets should continue to experience volatility as investors
question the euro's credibility. We believe the U.S. dollar will hold its
value versus most major currencies, due to the relative strength of the
U.S. economy and the dollar's benchmark status.
Thank you for your investment in the Strong International Bond Fund. We
look forward to serving your investment needs.
John T. Bender
Portfolio Co-Manager
Bradley C. Tank
Portfolio Co-Manager
--------------------------------------------------------------------------------
AVERAGE ANNUAL
TOTAL RETURNS
As of 10-31-00
1-year -9.99%
3-year -1.88%
5-year 0.37%
Since Inception 4.04%
(3-31-94)
--------------------------------------------------------------------------------
PORTFOLIO STATISTICS
As of 10-31-00
30-day annualized yield/1/ 4.81%
Average maturity/2/ 5.2 years
Average quality rating/3/ AA
The Fund invests a portion of its assets in lower-quality securities that
present a significant risk for loss of principal and interest. Securities of the
Fund are generally valued at fair value through valuations obtained by a
commercial pricing service. Please consider this before investing.
--------------------------------------------------------------------------------
From time to time, the Fund's advisor has waived its management fees and/or
absorbed fund expenses, which has resulted in higher yields and returns.
/1/ Yields are historical and do not represent future yields. Yields fluctuate.
Yield is as of 10-31-00.
/2/ The Fund's average maturity includes the effect of futures.
/3/ For purposes of this average rating, the Fund's short-term debt obligations
have been assigned a long-term rating by the Advisor.
* The Salomon Smith Barney Non-U.S. World Government Bond Index (Currency
Unhedged) is an unmanaged index generally representative of liquid,
non-U.S. fixed income government securities. This index disregards the
effects of foreign currency fluctuations. The Lipper International Income
Funds Index is an equally weighted performance index of the largest
qualifying funds in this Lipper category. Source of the Salomon index data
is Standard & Poor's Micropal. Source of the Lipper index data is Lipper
Inc.
11
<PAGE>
Strong Short-Term Global Bond Fund
Effective November 30, 2000, the Fund's name is changing from the Strong
Short-Term Global Bond Fund to the Strong Advisor Short Duration Bond Fund.
Your Fund's Approach
The Strong Short-Term Global Bond Fund seeks total return by investing for a
high level of income with a low degree of share-price fluctuation. The Fund
invests primarily in higher- and medium-quality bonds from U.S. and foreign
issuers. The Fund may also invest up to 35% of its assets in lower-quality,
high-yield bonds. Under normal conditions, the Fund maintains an average
maturity of three years or less. The Fund's managers intend to attempt to limit
the Fund's exposure to foreign currency risk by using hedging strategies.
GROWTH OF AN ASSUMED $10,000 INVESTMENT
FROM 3-31-94 TO 10-31-00
<TABLE>
<CAPTION>
Salomon Smith Barney
The Strong 1-3 Year World Lipper Short World
Short-Term Global Government Bond Index Multi-Market Income
Bond Fund (Currency Hedged)* Funds Average*
<S> <C> <C> <C>
Mar 94 $10,000 $10,000 $10,000
Dec 94 $10,512 $10,152 $ 9,733
Dec 95 $11,612 $11,285 $10,428
Dec 96 $12,775 $12,087 $11,150
Dec 97 $13,628 $12,856 $11,452
Dec 98 $14,184 $13,796 $12,184
Dec 99 $15,003 $14,359 $12,355
Oct 00 $15,760 $15,153 $12,469
</TABLE>
This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Salomon Smith Barney 1-3 Year World Government Bond Index (Currency Hedged) and
the Lipper Short World Multi-Market Income Funds Average. Results include the
reinvestment of all dividends and capital gains distributions. Performance is
historical and does not represent future results. Investment returns and
principal value vary, and you may have a gain or loss when you sell shares.
Q: How did your fund perform?
A: During the fiscal year, the Fund kept pace with the Salomon Brothers 1-3
Year World Government Bond Index (Currency Hedged),* returning slightly
less than that index. However, our investment approach allowed the Fund's
returns to significantly surpass those of the Lipper Short World
Multi-Market Income Funds Average* for the same period.
Q: What market conditions, market events, and other factors impacted your
fund's performance?
A: In the U.S., yields on short-term bonds increased, while long-term yields
decreased. This was the result of aggressive monetary tightening (rate
hikes) by the Federal Reserve, whose activity primarily affects short-term
bonds. On the other end of the yield curve, the government's buyback of
long Treasury debt pushed yields downward. Interest rate hikes by the Fed
early in the year were successful in slowing the economy; it now appears
the Fed may delay any further increases in the fed funds rate.
In international markets, short-term interest rates were mixed during the
period. Interest rates trended higher at the beginning of the fiscal year,
as world economic growth strengthened, but later fell after monetary
tightening by central banks began to slow economic growth. Two-year German
notes now yield approximately 5.1%, while Japanese two-year bonds still
yield less than 0.75%.
12
<PAGE>
Corporate bond yields increased more than government yields because of
deterioration in credit quality in some sectors. Our emphasis on credit
analysis allowed us to avoid bonds from many of the companies that
experienced earnings disappointments, stock buybacks, and debt-financed
mergers, all of which can have a negative impact on their bonds.
Q: What investment strategies and techniques impacted your fund's performance?
A: The Fund maintained its overweightings in U.S. corporate and mortgage
bonds, which provided a higher level of income relative to international
markets. The additional coupon (stated rate of interest) provided by these
securities was more than sufficient to offset their price declines relative
to Treasuries. We continue to de-emphasize emerging markets and currently
have no holdings in the sector.
Our emphasis on credit analysis allowed us to avoid many of the corporate
bonds that experienced significant price declines. We continue to focus on
industries and companies that offer positive credit dynamics. Securities
that outperformed for the year include Waste Management and Triton Energy.
The latter of these was a particularly strong performer, as the company
used proceeds from a debt offering to purchase our holdings at above-market
prices.
Q: What is your future outlook?
A: We believe U.S. short-term government yields will be relatively stable over
the next year. The Fed is likely to remain on hold after seeing the rate of
economic growth drop to sustainable levels. Other bond markets, including
Japan and Europe, are likely to underperform the U.S. In Japan, short-term
rates will likely remain in a narrow range and do not look attractive at
near-zero yields. European bond markets are still experiencing considerable
inflationary pressures, primarily from a weak euro and high oil prices.
In the U.S., we anticipate that the corporate and mortgage-backed bond
sectors should outperform Treasuries in 2001 as interest rates and credit
quality stabilize. We believe the current environment presents an excellent
opportunity for buying bonds in these sectors. Going forward, we plan to
maintain our overweight in this country's corporates and mortgages relative
to other international markets.
--------------------------------------------------------------------------------
AVERAGE ANNUAL
TOTAL RETURNS
As of 10-31-00
1-year 5.83%
3-year 5.42%
5-year 6.68%
Since Inception 7.15%
(3-31-94)
PORTFOLIO STATISTICS
As of 10-31-00
30-day
annualized yield/1/ 6.33%
Average maturity/2/ 1.6 years
Average quality rating/3/ A
The Fund invests a portion of its assets in lower-quality securities that
present a significant risk for loss of principal and interest. Securities of the
Fund are generally valued at fair value through valuations obtained by a
commercial pricing service. Please consider this before investing.
--------------------------------------------------------------------------------
Thank you for your investment in the Strong Short-Term Global Bond Fund.
Jeffrey A. Koch
Portfolio Co-Manager
Bradley C. Tank
Portfolio Co-Manager
From time to time, the Fund's advisor has waived its management fee and/or
absorbed fund expenses, which has resulted in higher yields and returns.
/1/ Yields are historical and do not represent future yields. Yields fluctuate.
Yield is as of 10-31-00.
/2/ The Fund's average maturity includes the effect of futures.
/3/ For the purposes of the average, the Fund's short-term debt obligations
have been assigned a long-term rating by the Advisor.
* The Salomon Smith Barney 1-3 Year World Government Bond Index (Currency
Hedged) is an unmanaged index generally representative of short-term,
global fixed income government securities. Rolling one-month forward
exchange contracts are used as the hedging instrument. The Lipper Short
World Multi-Market Income Funds Average represents funds that invest in
non-U.S. dollar and U.S. dollar debt instruments and, by policy, keep a
dollar-weighted average maturity of less than five years. Source of the
Salomon index data is Salomon Smith Barney. Source of the Lipper data is
Lipper Inc.
13
<PAGE>
<TABLE>
<CAPTION>
SCHEDULES OF INVESTMENTS IN SECURITIES October 31, 2000
----------------------------------------------------------------------------
STRONG ASIA PACIFIC FUND
Shares or
Principal Value
Amount (Note 2)
----------------------------------------------------------------------------
<S> <C> <C>
Common Stocks 92.3%
Australia 19.3%
BHP, Ltd. 75,980 $ 738,972
CPH Investment Corporation (b) 1,815,000 566,389
emitch, Ltd. (b) 296,400 53,955
MIM Holdings, Ltd. 2,146,476 1,194,529
Norwood Abbey, Ltd. (b) 1,500,000 546,105
Novogen, Ltd. (b) 585,000 1,113,586
OneSteel, Ltd. (b) 18,995 9,089
Publishing & Broadcasting, Ltd. 90,000 616,475
SecureNet, Ltd. (b) 185,000 803,424
Sons of Gwalia, Ltd. 320,000 996,928
Southcorp, Ltd. 480,000 1,244,245
Sydney Aquarium, Ltd. 413,450 793,480
WMC, Ltd. 340,000 1,304,151
Woodside Petroleum, Ltd. 142,000 1,041,344
------------
11,022,672
China 7.7%
China Merchants Hai Hong Holdings 1,900,000 1,327,921
Guangshen Railway Company, Ltd. 10,730,000 1,307,211
Martin Currie China Heartland Fund, Ltd. (b) 118,000 1,027,780
PetroChina Company, Ltd. 3,650,000 767,643
------------
4,430,555
Hong Kong 4.1%
China National Aviation Company, Ltd. 8,500,000 1,286,244
Dickson Concepts International, Ltd. 356,500 180,584
First Pacific Company, Ltd. 3,500,000 794,445
Li & Fung, Ltd. 60,000 111,568
------------
2,372,841
India 3.8%
HCL Technologies, Ltd. 29,000 737,272
The Indian Smaller Companies Fund, Ltd. (b) 30,792 510,223
SSI, Ltd. 15,000 683,976
UTI-Mastergrowth 93 Fund 732,400 240,742
------------
2,172,213
Japan 20.5%
Focus Systems Corporation 27,000 527,954
Fuji Television Network, Inc. 80 881,300
Fujitsu, Ltd./Macquarie Warrants, Expire 9/17/01 800 20,000
Hitachi Maxell, Ltd. 51,000 955,109
Jafco Company, Ltd. 11,000 1,171,395
Murata Manufacturing Company Warrants,
Expire 9/19/01 1,200 300,000
Net One Systems Company, Ltd. 44 1,308,730
The Nikko Securities Company, Ltd. 166,000 1,435,527
Nippon Express Company, Ltd. 194,000 1,166,529
Nomura Securities Company, Ltd. 80,000 1,700,174
SKY Perfect Communications, Inc. (b) 400 738,089
Sony Corporation Warrants, Expire 8/17/01 1,100 117,150
The Tokio Marine & Fire Insurance Company, Ltd. 130,000 1,439,273
------------
11,761,230
Malaysia 2.7%
Berjaya Sports Toto BHD 212,000 278,955
Genesis Malaysia Maju Fund, Ltd. (b) 32,000 624,000
Malaysia International Shipping BHD (Fgn Reg) 188,000 331,482
Sime Darby BHD 261,000 326,946
------------
1,561,383
New Zealand 8.1%
Air New Zealand, Ltd. Class B 1,166,666 1,040,550
Frucor Beverages Group, Ltd. (b) 800,000 624,726
Guinness Peat Group PLC 2,370,771 1,447,251
Sky Network Television, Ltd. (b) 507,716 623,902
Telecom Corporation of New Zealand, Ltd. 400,000 884,765
------------
4,621,194
Singapore 15.9%
City Developments, Ltd. 310,000 $ 1,431,585
DBS Group Holdings, Ltd. 114,247 1,348,297
First Capital Corporation, Ltd. 1,280,000 1,036,260
Fraser & Neave, Ltd. 375,000 1,304,162
Hong Leong Finance, Ltd. (Fgn Reg) (b) 143,000 195,667
Neptune Orient Lines, Ltd. (b) 1,550,000 1,316,705
Sembcorp Logistics, Ltd. 200,000 1,083,238
Singapore Telecommunications, Ltd. 823,000 1,365,410
------------
9,081,324
South Korea 1.7%
Samsung Heavy Industry Company, Ltd. (b) 197,000 613,891
Trigem Computer, Inc. 54,500 355,017
------------
968,908
Taiwan 0.9%
Taiwan Opportunities Fund, Ltd. (b) 55,000 515,900
Thailand 7.6%
BEC World PCL 220,000 1,032,346
Hana Microelectronics PCL 300,000 744,875
PTT Exploration and Production PCL (Fgn Reg) 356,000 875,809
Siam Cement PCL (Fgn Reg) (b) 136,000 1,282,551
Southeast Asia Frontier Fund LP (b) 74,000 397,750
------------
4,333,331
----------------------------------------------------------------------------
Total Common Stocks (Cost $57,580,513) 52,841,551
----------------------------------------------------------------------------
Short-Term Investments (a) 8.0%
Commercial Paper 0.1%
Interest Bearing, Due Upon Demand
United States
United States Cayman Eurodollar
Call Deposit, 5.50% $ 85,000 85,000
Time Deposits 7.9%
United States
HSBC Bank USA, 6.5625%, Due 11/01/00 4,500,000 4,500,000
----------------------------------------------------------------------------
Total Short-Term Investments (Cost $4,585,000) 4,585,000
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Total Investments in Securities (Cost $62,165,513) 100.3% 57,426,551
Other Assets and Liabilities, Net (0.3%) (171,486)
----------------------------------------------------------------------------
Net Assets 100.0% $ 57,255,065
============================================================================
STRONG FOREIGN MAJORMARKETS FUND
Shares or
Principal Value
Amount (Note 2)
-----------------------------------------------------------------------------
Common Stocks 85.5%
Australia 3.1%
National Australia Bank, Ltd. 1,001 $ 13,953
TABCORP Holdings, Ltd. 15,400 84,004
-----------
97,957
Belgium 0.3%
Fortis (B) 320 9,805
Canada 1.9%
Celestica, Inc. (b) 500 35,938
Shaw Communications, Inc. Class B 1,200 24,635
-----------
60,573
Finland 4.3%
Nokia Corporation Sponsored ADR 1,600 68,400
Nokia Oyj 1,640 67,500
-----------
135,900
</TABLE>
14
<PAGE>
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
STRONG FOREIGN MAJORMARKETS FUND (continued)
Shares or
Principal Value
Amount (Note 2)
--------------------------------------------------------------------------------
<S> <C> <C>
France 14.0%
Accor SA 800 $ 32,390
BNP Paribas 500 43,119
L'OREAL SA 200 15,278
Lafarge SA 600 44,307
NRJ Group (b) 620 20,524
STMicroelectronics NV 2,160 111,654
Societe Generale 1,200 68,142
Societe Television Francaise 1 900 49,120
Suez Lyonnaise des Eaux 300 45,784
Vivendi SA 196 14,091
-----------
444,409
Germany 1.6%
Siemens AG 410 52,201
Hong Kong 9.2%
China Mobile, Ltd. (b) 4,000 25,776
China Mobile, Ltd. Sponsored ADR (b) 1,800 55,125
Hutchison Whampoa, Ltd. 4,200 52,110
Johnson Electric Holdings, Ltd. 35,600 70,763
Li & Fung, Ltd. 48,000 89,255
-----------
293,029
India 3.3%
Infosys Technologies, Ltd. Sponsored ADR 200 30,645
WIPRO, Ltd. 500 25,452
WIPRO, Ltd. ADR (b) 600 31,575
Zee Telefilms, Ltd. 2,800 18,829
-----------
106,501
Italy 4.3%
Bipop-Carire Spa 6,000 47,567
Mediaset Spa 1,800 26,172
Mediolanum Spa 2,400 35,242
Telecom Italia Mobile Spa 3,090 26,464
-----------
135,445
Japan 12.7%
Daiwa Securities Group, Inc. 6,000 66,593
Fuji Television Network, Inc. 6 66,097
Fujitsu, Ltd. 1,000 17,846
Keyence Corporation 100 31,121
NTT DoCoMo, Inc. 1 24,695
Nippon Television Network Corporation 70 39,521
Nomura Securities Company, Ltd. 2,000 42,504
Rohm Company, Ltd. 100 25,255
Shin-Etsu Chemical Company, Ltd. 1,000 41,127
Sony Corporation 400 32,021
Sony Corporation Sponsored ADR 200 16,600
-----------
403,380
Malaysia 0.4%
Telekom Malaysia BHD 4,000 12,316
Mexico 1.4%
Fomento Economico Mexicano SA de CV
Sponsored ADR 1,200 45,825
Netherlands 3.2%
ASM Lithography Holding NV (b) 2,100 57,414
KPNQwest NV (b) 600 14,775
Koninklijke Philips Electronics NV Sponsored ADR
New York Registry Shares 776 30,991
-----------
103,180
New Zealand 0.0%
Telecom Corporation of New Zealand, Ltd. 460 1,017
Singapore 1.4%
Singapore Airlines, Ltd. 2,000 20,069
Singapore Press Holdings, Ltd. 1,600 22,896
-----------
42,965
Spain 2.7%
Banco Santander Central Hispano SA 5,740 $ 55,639
Telefonica SA (b) 1,621 30,917
-----------
86,556
Sweden 1.5%
Skandia Forsakrings AB 2,780 47,223
Switzerland 5.8%
Adecco SA 100 69,156
Adecco SA ADR 400 34,600
Novartis AG Sponsored ADR 1,470 56,411
UBS AG - Registered Shares 180 24,936
-----------
185,103
Taiwan 0.7%
Taiwan Semiconductor Manufacturing Company, Ltd.
Sponsored ADR (b) 1,000 22,688
United Kingdom 13.7%
Baa PLC 3,300 27,376
BAE SYSTEMS PLC 5,700 32,308
BG Group PLC 8,100 32,367
BP Amoco PLC Sponsored ADR 1,800 91,688
British Airways PLC Sponsored ADR 700 31,062
British Telecommunications PLC Sponsored ADR 200 23,800
Energis PLC (b) 5,000 42,674
GKN PLC 3,100 35,457
Lattice Goup PLC (b) 5,400 11,493
Lloyds TSB Group PLC 5,800 58,949
Scottish & Newcastle PLC 3,000 20,501
SmithKline Beecham PLC 7 90
Vodafone AirTouch PLC 6,763 28,077
-----------
435,842
-------------------------------------------------------------------------------
Total Common Stocks (Cost $2,881,156) 2,721,915
-------------------------------------------------------------------------------
Short-Term Investments (a) 14.2%
Commercial Paper 1.6%
Interest Bearing, Due Upon Demand
United States
United States Cayman Eurodollar Call
Deposit, 5.50% $ 52,000 52,000
Time Deposits 12.6%
United States
HSBC Bank USA, 6.5625%, Due 11/01/00 400,000 400,000
-------------------------------------------------------------------------------
Total Short-Term Investments (Cost $452,000) 452,000
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Total Investments in Securities (Cost $3,333,156) 99.7% 3,173,915
Other Assets and Liabilities, Net 0.3% 7,939
-------------------------------------------------------------------------------
Net Assets 100.0% $ 3,181,854
===============================================================================
STRONG INTERNATIONAL STOCK FUND
Shares or
Principal Value
Amount (Note 2)
--------------------------------------------------------------------------------
Common Stocks 97.0%
Australia 3.6%
TABCORP Holdings, Ltd. 804,000 $ 4,385,666
Canada 8.3%
Celestica, Inc. (b) 17,800 1,279,375
Nortel Networks Corporation 137,400 6,251,700
Research in Motion, Ltd. (b) 16,500 1,650,000
Shaw Communications, Inc. Class B 48,700 999,787
-----------
10,180,862
</TABLE>
15
<PAGE>
<TABLE>
<CAPTION>
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) October 31, 2000
--------------------------------------------------------------------------------
STRONG INTERNATIONAL STOCK FUND (continued)
Shares or
Principal Value
Amount (Note 2)
------------------------------------------------------------------------------------------
<S> <C> <C>
Egypt 0.0%
Suez Cement (b) 30 $ 276
Finland 5.5%
Nokia Corporation Sponsored ADR 15,700 671,175
Nokia Oyj 149,500 6,153,168
-------------
6,824,343
France 13.2%
Accor SA 19,200 777,365
BNP Paribas 17,400 1,500,543
NRJ Group (b) 32,550 1,077,509
STMicroelectronics NV 173,600 8,760,057
Societe Generale 20,776 1,179,759
Societe Television Francaise 1 40,000 2,183,114
Vivendi SA 11,000 790,827
-------------
16,269,174
Hong Kong 8.9%
China Mobile, Ltd. (b) 124,000 799,061
China Mobile, Ltd. Sponsored ADR (b) 54,100 1,656,812
Hutchison Whampoa, Ltd. 193,600 2,402,031
Johnson Electric Holdings, Ltd. 1,207,000 2,399,172
Li & Fung, Ltd. 1,974,000 3,670,604
-------------
10,927,680
India 4.7%
Infosys Technologies, Ltd. Sponsored ADR 8,100 1,241,123
UTI-Mastergrowth 93 Fund 12,600 4,141
Wipro, Ltd. 40,800 2,076,885
Wipro, Ltd. ADR (b) 32,200 1,694,525
Zee Telefilms, Ltd. 115,700 778,051
-------------
5,794,725
Ireland 0.5%
Connemara Green Marble Quarries PLC (Acquired
11/21/96 - 6/20/97; Cost $635,000) (b) (d) (e) 50,800 635,000
Connemara Green Marble Quarries PLC Warrants,
Expire 9/30/02 (Acquired 11/21/96;
Cost $0) (b) (d) (e) 8,000 0
-------------
635,000
Italy 7.7%
Bipop-Carire SPA 443,600 3,516,769
Mediaset Spa 104,800 1,523,786
Mediolanum Spa 210,300 3,088,096
Telecom Italia Mobile Spa 150,600 1,289,797
-------------
9,418,448
Japan 18.2%
Daiwa Securities Group, Inc. 328,000 3,640,430
Fuji Television Network, Inc. 109 1,200,771
Hoya Corporation 15,000 1,242,082
Keyence Corporation 6,100 1,898,375
NTT DoCoMo, Inc. 85 2,099,055
Nippon Television Network Corporation 3,070 1,733,269
Nomura Securities Company, Ltd. 79,000 1,678,922
Rohm Company, Ltd. 8,000 2,020,380
Sakura Bank, Ltd. 261,000 1,904,847
Shin-Etsu Chemical Company, Ltd. 39,000 1,603,966
Takeda Chemical Industries, Ltd. 19,000 1,254,108
Tokyo Electron, Ltd. 27,000 2,116,772
-------------
22,392,977
Mexico 1.1%
Fomento Economico Mexicano SA de CV
Sponsored ADR 35,500 1,355,656
Netherlands 3.4%
ASM Lithography Holding NV (b) 127,800 3,494,033
KPNQwest NV (b) 26,300 647,637
-------------
4,141,670
Singapore 1.3%
Singapore Press Holdings, Ltd. 107,700 1,541,203
Spain 2.4%
Banco Santander Central Hispano SA 85,696 $ 830,677
Telefonica SA (b) 111,000 2,117,051
-------------
2,947,728
Sweden 1.9%
Skandia Forsakrings AB 136,500 2,318,660
Switzerland 2.3%
Adecco SA 745 515,208
Adecco SA ADR 3,000 259,500
Novartis AG (b) 300 455,158
Novartis AG Sponsored ADR 40,600 1,558,025
-------------
2,787,891
Taiwan 1.6%
Taiwan Semiconductor Manufacturing
Company, Ltd. Sponsored ADR (b) 87,724 1,990,238
United Kingdom 10.7%
BAE SYSTEMS PLC 229,400 1,300,271
BG Group PLC 314,300 1,255,920
BP Amoco PLC Sponsored ADR 79,500 4,049,531
Energis PLC (b) 355,600 3,034,968
GKN PLC 47,650 545,003
Lattice Group PLC (b) 208,900 444,595
Lloyds TSB Group PLC 128,300 1,303,984
Vodafone AirTouch PLC 302,430 1,255,558
-------------
13,189,830
United States 1.7%
JDS Uniphase Corporation (b) 26,100 2,123,888
------------------------------------------------------------------------------------------
Total Common Stocks (Cost $91,019,205) 119,225,915
------------------------------------------------------------------------------------------
Short-Term Investments (a) 3.2%
Commercial Paper 0.0%
Interest Bearing, Due Upon Demand
United States
United States Cayman Eurodollar Call
Deposit, 5.50% $ 23,000 23,000
Time Deposits 3.2%
United States
HSBC Bank USA, 6.5625%, Due 11/01/00 3,900,000 3,900,000
------------------------------------------------------------------------------------------
Total Short-Term Investments (Cost $3,923,000) 3,923,000
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
Total Investments in Securities (Cost $94,942,205) 100.2% 123,148,915
Other Assets and Liabilities, Net (0.2%) (232,966)
------------------------------------------------------------------------------------------
Net Assets 100.0% $ 122,915,949
==========================================================================================
</TABLE>
STRONG OVERSEAS FUND
<TABLE>
<CAPTION>
Shares or
Principal Value
Amount (Note 2)
-----------------------------------------------------------------------------------------
<S> <C> <C>
Common Stocks 99.0%
Australia 3.5%
TABCORP Holdings, Ltd. 284,000 $ 1,549,166
Canada 7.6%
Celestica, Inc. (b) 10,100 725,937
Nortel Networks Corporation 39,800 1,810,900
Research in Motion, Ltd. (b) 5,400 540,000
Shaw Communications, Inc. Class B 16,000 328,472
-----------
3,405,309
Finland 4.4%
Nokia Corporation Sponsored ADR 20,700 884,925
Nokia OYJ 26,720 1,099,750
-----------
1,984,675
</TABLE>
16
<PAGE>
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------
STRONG OVERSEAS FUND (continued)
Shares or
Principal Value
Amount (Note 2)
-----------------------------------------------------------------------------------------
<S> <C> <C>
France 12.6%
Accor SA 13,600 $ 550,634
BNP Paribas 6,200 534,676
NRJ Group (b) 11,780 389,956
STMicroelectronics NV 49,800 2,541,311
Societe Generale 10,784 612,366
Societe Television Francaise 1 13,000 709,512
Vivendi SA 4,000 287,573
-----------
5,626,028
Hong Kong 8.7%
China Mobile, Ltd. (b) 78,000 502,635
China Mobile, Ltd. Sponsored ADR (b) 27,200 833,000
Hutchison Whampoa, Ltd. 64,900 805,227
Johnson Electric Holdings, Ltd. 350,400 696,495
Li & Fung, Ltd. 576,000 1,071,058
-----------
3,908,415
India 5.1%
Infosys Technologies, Ltd. Sponsored ADR 3,200 490,320
WIPRO, Ltd. 18,700 951,906
WIPRO, Ltd. ADR (b) 10,400 547,300
Zee Telefilms, Ltd. 44,500 299,250
-----------
2,288,776
Italy 6.3%
Bipop-Carire Spa 93,000 737,285
Mediaset Spa 32,800 476,910
Mediolanum Spa 79,300 1,164,460
Telecom Italia Mobile Spa 51,100 437,640
-----------
2,816,295
Japan 20.5%
Daiwa Securities Group, Inc. 87,000 965,602
Fuji Television Network, Inc. 58 638,942
Hoya Corporation 10,000 828,055
Keyence Corporation 1,700 529,055
NTT DoCoMo, Inc. 33 814,927
Nippon Television Network Corporation 1,410 796,062
Nomura Securities Company, Ltd. 29,000 616,313
Rohm Company, Ltd. 3,300 833,407
Sakura Bank, Ltd. 80,000 583,861
Shin-Etsu Chemical Company, Ltd. 23,000 945,929
Takeda Chemical Industries, Ltd. 9,000 594,051
Tokyo Electron, Ltd. 12,900 1,011,347
-----------
9,157,551
Mexico 1.9%
Fomento Economico Mexicano SA de CV
Sponsored ADR 21,796 832,335
Netherlands 3.2%
ASM Lithography Holding NV (b) 44,700 1,234,144
KPNQwest NV (b) 7,800 192,075
-----------
1,426,219
Singapore 1.3%
Singapore Press Holdings, Ltd. 39,900 570,975
Spain 2.3%
Banco Santander Central Hispano SA 26,494 256,814
Telefonica SA (b) 41,000 781,974
-----------
1,038,788
Sweden 2.3%
Skandia Forsakrings AB 60,400 1,025,986
Switzerland 4.1%
Adecco SA 1,475 1,020,043
Novartis AG Sponsored ADR 21,400 821,225
-----------
1,841,268
Taiwan 2.0%
Taiwan Semiconductor Manufacturing Company, Ltd.
Sponsored ADR (b) 39,712 900,966
United Kingdom 11.8%
BAE SYSTEMS PLC 93,800 $ 531,671
BG Group PLC 136,200 544,245
BP Amoco PLC Sponsored ADR 31,300 1,594,344
Energis PLC (b) 106,200 906,394
GKN PLC 28,500 325,972
Lattice Group PLC (b) 90,500 192,608
Lloyds TSB Group PLC 65,700 667,746
Vodafone AirTouch PLC 125,253 519,996
-----------
5,282,976
United States 1.4%
JDS Uniphase Corporation (b) 7,400 602,175
----------------------------------------------------------------------------------------
Total Common Stocks (Cost $47,250,732) 44,257,903
----------------------------------------------------------------------------------------
Short-Term Investments (a) 1.2%
Commercial Paper 0.1%
Interest Bearing, Due Upon Demand
United States
United States Cayman Eurodollar
Call Deposit, 5.50% $ 32,000 32,000
Time Deposits 1.1%
United States
HSBC Bank USA, 6.5625%, Due 11/01/00 500,000 500,000
----------------------------------------------------------------------------------------
Total Short-Term Investments (Cost $532,000) 532,000
----------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------
Total Investments in Securities (Cost $47,782,732) 100.2% 44,789,903
Other Assets and Liabilities, Net (0.2%) (69,928)
----------------------------------------------------------------------------------------
Net Assets 100.0% $44,719,975
========================================================================================
STRONG INTERNATIONAL BOND FUND
Shares or
Principal Value
Amount (Note 2)
-------------------------------------------------------------------------------------------
Corporate Bonds 6.3%
New Zealand 1.7%
International Bank for Reconstruction and
Development Medium-Term Notes, Zero %,
Due 8/20/07 (c) 1,000,000 NZD $ 242,200
United States 4.6%
R&B Falcon Corporation Senior Notes,
Series B, 6.50%, Due 4/15/03 $ 200,000 191,000
Statia Terminals International/Statia Terminals
Canada, Inc. First Mortgage Notes, Series B,
11.75%, Due 11/15/03 250,000 253,125
Triton Energy, Ltd./Triton Energy Corporation
Senior Notes, 8.75%, Due 4/15/02 200,000 207,800
-------------------------------------------------------------------------------------------
Total Corporate Bonds (Cost $1,062,520) 894,125
-------------------------------------------------------------------------------------------
Government & Agency Issues 57.9%
Australia 2.7%
Australian Government Bonds, 7.50%,
Due 7/15/05 700,000 AUD 384,421
Denmark 3.7%
Kingdom of Denmark Notes, 7.00%,
Due 11/15/07 4,250,000 DKK 526,081
France 5.8%
Government of France Debentures, 8.50%,
Due 11/25/02 914,694 EUR 826,270
</TABLE>
17
<PAGE>
<TABLE>
<CAPTION>
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) October 31, 2000
-----------------------------------------------------------------------------------------------
STRONG INTERNATIONAL BOND FUND (continued)
Shares or
Principal Value
Amount (Note 2)
-----------------------------------------------------------------------------------------------
<S> <C> <C>
Germany 12.8%
Republic of Germany Bonds, Series 97, 6.00%,
Due 7/04/07 (c) 2,072,583 EUR $ 1,832,749
Italy 9.8%
Buoni Poliennali Del Tes Bonds, 7.75%,
Due 11/01/06 (c) 1,478,988 EUR 1,392,732
United Kingdom 23.1%
United Kingdom Treasury Bonds, 5.00%,
Due 6/07/04 375,000 GBP 531,513
United Kingdom Treasury Bonds, 6.50%,
Due 12/07/03 375,000 GBP 554,394
United Kingdom Treasury Bonds, 7.00%,
Due 6/07/02 1,500,000 GBP 2,212,307
-----------
3,298,214
-----------------------------------------------------------------------------------------------
Total Government & Agency Issues (Cost $10,143,303) 8,260,467
-----------------------------------------------------------------------------------------------
Non-Agency Mortgage & Asset-Backed Securities 7.7%
United States
Citicorp Mortgage Securities, Inc. Real Estate
Mortgage Investment Conduit Pass-Thru
Certificates, Series 1993-3, Class B1, 7.00%,
Due 3/25/08 (c) (d) $ 268,210 264,507
DLJ Mortgage Acceptance Corporation
Variable Rate Mortgage Pass-Thru Certificates:
Series 1990-2, Class A, 7.6849%,
Due 1/25/22 (c) 166,708 166,039
Series 1991-3, Class A1, 7.5024%,
Due 2/20/21 (c) 318,980 317,611
First Boston Mortgage Securities Corporation
Mortgage Pass-Thru Certificates,
Series 1992-4, Class A5, Interest Only,
0.625%, Due 10/25/22 (c) 7,012,895 70,129
Resolution Trust Corporation Mortgage
Pass-Thru Securities, Inc. Variable Rate
Certificates, Series 1995-1, Class B-5,
7.9361%, Due 10/25/28 (c) 272,800 272,267
-----------------------------------------------------------------------------------------------
Total Non-Agency Mortgage & Asset-Backed
Securities (Cost $1,016,645) 1,090,553
-----------------------------------------------------------------------------------------------
Short-Term Investments (a) 27.4%
Commercial Paper 0.6%
Interest Bearing, Due Upon Demand
United States
United States Cayman Eurodollar
Call Deposit, 5.50% 78,000 78,000
Corporate Bonds 1.3%
United States
Viacom International, Inc. Senior Subordinated
Notes, 10.25%, Due 9/15/01 180,000 184,616
Government & Agency Issues 7.3%
Denmark 3.5%
Kingdom of Denmark Notes, 9.00%,
Due 11/15/00 4,400,000 DKK 502,393
Finland 3.1%
Government of Finland Bonds, 10.00%,
Due 9/15/01 3,000,000 FIM 445,341
United States 0.7%
United States Treasury Bills, Due 4/26/01 (c) $ 100,000 $ 97,037
-----------
Total Government & Agency Issues 1,044,771
Time Deposits 18.2%
United States
HSBC Bank USA, 6.5625%, Due 11/01/00 2,600,000 2,600,000
-----------------------------------------------------------------------------------------------
Total Short-Term Investments (Cost $4,371,820) 3,907,387
-----------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------
Total Investments in Securities (Cost $16,594,288) 99.3% 14,152,532
Other Assets and Liabilities, Net 0.7% 103,540
-----------------------------------------------------------------------------------------------
Net Assets 100.0% $14,256,072
===============================================================================================
FUTURES
-----------------------------------------------------------------------------------------------
Expiration Underlying Face Unrealized
Date Amount at Value Appreciation
-----------------------------------------------------------------------------------------------
Purchased:
21 Ten-Year Euro Bonds 12/00 $1,877,146 $14,418
3 Ten-Year Japanese Government Bonds 12/00 3,663,522 56,782
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
-----------------------------------------------------------------------------------------------
Unrealized
Settlement Appreciation
Date Value in USD (Depreciation)
-----------------------------------------------------------------------------------------------
Purchased:
1,000,000 CAD 4/04/01 $ 659,324 ($ 7,788)
2,050,000 EUR 2/07/01 1,747,082 (125,286)
1,150,000 GBP 4/04/01 1,669,225 (25,128)
550,000,000 JPY 2/07/01 5,136,754 (123,383)
Sold:
1,150,000 AUD 4/04/01 598,856 26,686
9,500,000 DKK 1/04/01 1,086,679 38,514
----------------------------------------------------------------------------------------------
STRONG SHORT-TERM GLOBAL BOND FUND
Shares or
Principal Value
Amount (Note 2)
-----------------------------------------------------------------------------------------------
Corporate Bonds 22.4%
Canada 2.6%
Acetex Corporation Senior Secured Notes,
9.75%, Due 10/01/03 1,000,000 USD $ 940,000
MetroNet Communications Corporation
Senior Yankee Notes, 12.00%, Due 8/15/07 350,000 USD 389,713
-----------
1,329,713
New Zealand 0.5%
International Bank for Reconstruction and
Development Medium-Term Notes, Zero %,
Due 8/20/07 1,000,000 NZD 242,200
United Kingdom 0.9%
Telewest PLC Senior Discount Debentures,
11.00%, Due 10/01/07 (c) 500,000 USD 437,500
United States 18.4%
Adelphia Communications Corporation
Senior Notes, 9.25%, Due 10/01/02 $1,000,000 985,000
Cendant Corporation Notes, 7.75%,
Due 12/01/03 500,000 485,298
International Paper Company Floating Rate
Notes, 7.6025%, Due 7/08/02 (d) 1,000,000 1,002,674
NTL, Inc. Senior Notes, Series A, 12.75%,
Due 4/15/05 1,000,000 980,000
Nextlink Communications LLC Senior Notes,
12.50%, Due 4/15/06 500,000 472,500
</TABLE>
18
<PAGE>
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------
STRONG SHORT-TERM GLOBAL BOND FUND (continued)
Shares or
Principal Value
Amount (Note 2)
--------------------------------------------------------------------------------------
<S> <C> <C>
R&B Falcon Corporation Senior Notes,
Series B, 6.50%, Due 4/15/03 $1,000,000 $ 955,000
Radio One, Inc. Senior Subordinated Notes,
Series B, 12.00%, Due 5/15/04 1,000,000 1,040,000
Tenet Healthcare Corporation Senior Notes,
8.625%, Due 12/01/03 1,000,000 1,007,756
Triton Energy, Ltd./Triton Energy Corporation
Senior Notes, 8.75%, Due 4/15/02 1,000,000 1,039,000
USA Waste Services, Inc. Senior Notes, 6.50%,
Due 12/15/02 500,000 482,519
WMX Technologies, Inc. Notes, 7.10%,
Due 8/01/26 500,000 482,688
Young Broadcasting, Inc. Senior Subordinated
Notes, 11.75%, Due 11/15/04 500,000 512,500
-----------
9,444,935
--------------------------------------------------------------------------------------
Total Corporate Bonds (Cost $11,671,609) 11,454,348
--------------------------------------------------------------------------------------
Government & Agency Issues 24.9%
Australia 2.9%
Australian Government Bonds, 6.75%,
Due 11/15/06 2,750,000 AUD 1,473,665
Germany 3.0%
Republic of Germany Bonds, Series 96, 6.25%,
Due 4/26/06 1,750,000 EUR 1,555,750
United Kingdom 4.3%
United Kingdom Treasury Bonds, 7.00%,
Due 6/07/02 1,500,000 GBP 2,212,306
United States 14.7%
FHLMC Multi-Class Mortgage Participation
Certificates, 9.50%, Due 6/15/06 (c) $ 668,674 682,006
FHLMC Participation Certificates:
7.00%, Due 5/01/03 thru 7/15/06 1,024,010 1,021,129
7.69%, Due 7/01/10 162,098 163,980
9.00%, Due 8/01/18 576,257 599,640
10.00%, Due 6/01/05 238,277 245,665
FNMA Guaranteed Mortgage Pass-Thru
Certificates, Pool 372179, 11.00%,
Due 4/01/12 203,741 221,010
FNMA Guaranteed Real Estate Mortgage
Investment Conduit Pass-Thru Certificates:
Pool 149167, 10.50%, Due 8/01/20 (c) 189,352 202,431
Pool 313629, 8.50%, Due 11/01/02 (c) 659,182 662,193
FNMA Guaranteed Real Estate Mortgage
Investment Conduit Variable Rate Mortgage
Certificates, Pool 365418, 7.266%,
Due 1/01/23 400,230 403,351
GNMA Guaranteed Pass-Thru Certificates,
Pool 234503, 9.50%, Due 12/15/17 3,127,793 3,288,269
-----------
7,489,674
--------------------------------------------------------------------------------------
Total Government & Agency Issues (Cost $13,160,834) 12,731,395
--------------------------------------------------------------------------------------
Non-Agency Mortgage & Asset-Backed
Securities 16.8%
United States
Citicorp Mortgage Securities, Inc. Real Estate
Mortgage Investment Conduit Pass-Thru
Certificates, Series 1993-3, Class B1, 7.00%,
Due 3/25/08 (d) 536,419 529,014
DLJ Acceptance Trust Collateralized Mortgage
Obligation, Series 1989-1, Class F, 11.00%,
Due 8/01/19 (c) 1,319,254 1,431,062
DLJ Mortgage Acceptance Corporation Variable
Rate Mortgage Pass-Thru Certificates:
Series 1990-2, Class A, 7.6849%, Due 1/25/22 $ 666,832 $ 664,155
Series 1991-3, Class A1, 7.5024%, Due 2/20/21 (c) 637,961 635,222
Duke Funding I, Ltd. Floating Rate Notes,
Class A, 7.125%, Due 11/10/30 (f) 1,500,000 1,494,300
Empire Funding Home Loan Owner Trust
Asset-Backed Notes, Series 1997-4,
Class A-3, 7.11%, Due 7/25/14 (c) 549,934 547,625
Kmart CMBS Financing, Inc. Floating Rate
Commercial Mortgage Pass-Thru Certificates,
Series 1997-1, Class D, 7.72%, Due 3/01/07 (d) 2,000,000 1,994,090
Merrill Lynch Credit Corporation Mortgage
Investors, Inc. Senior Subordinated Variable Rate
Mortgage Pass-Thru Certificates, Series 1994-A,
Class A4, 8.0279%, Due 7/15/19 730,324 731,574
Resolution Trust Corporation Mortgage
Pass-Thru Securities, Inc. Variable Rate
Certificates, Series 1995-1, Class B-5,
7.9361%, Due 10/25/28 (c) 131,918 131,660
Ryland Mortgage Securities Corporation Variable
Rate Mortgage Participation Securities,
Series 1990-C1, Class A, 6.8319%,
Due 10/25/20 440,072 435,554
--------------------------------------------------------------------------------------
Total Non-Agency Mortgage & Asset-Backed
Securities (Cost $8,525,605) 8,594,256
--------------------------------------------------------------------------------------
Short-Term Investments (a) 40.4%
Commercial Paper 0.2%
Interest Bearing, Due Upon Demand
United States
United States Cayman Eurodollar Call
Deposit, 5.50% 95,000 95,000
Corporate Bonds 5.9%
United States
Enron Corporation Floating Rate Notes, 7.11%,
Due 9/10/01 (d) 1,000,000 1,000,335
GS Escrow Corporation Senior Notes, 6.75%,
Due 8/01/01 1,000,000 987,412
Raytheon Company Floating Rate Notes, 7.02%,
Due 8/10/01 1,000,000 1,000,926
---------
Total Corporate Bonds 2,988,673
Government & Agency Issues 0.1%
United States
United States Treasury Bills, Due 4/26/01 (c) 65,000 63,074
Time Deposits 34.2%
United States
HSBC Bank USA, 6.5625%, Due 11/01/00 17,500,000 17,500,000
--------------------------------------------------------------------------------------
Total Short-Term Investments (Cost $20,656,067) 20,646,747
--------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------
Total Investments in Securities (Cost $54,014,115) 104.5% 53,426,746
Other Assets and Liabilities, Net (4.5%) (2,283,188)
--------------------------------------------------------------------------------------
Net Assets 100.0% $51,143,558
======================================================================================
</TABLE>
19
<PAGE>
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) October 31, 2000
--------------------------------------------------------------------------------
STRONG SHORT-TERM GLOBAL BOND FUND (continued)
--------------------------------------------------------------------------------
FUTURES
--------------------------------------------------------------------------------
Unrealized
Expiration Underlying Face Appreciation
Date Amount at Value (Depreciation)
--------------------------------------------------------------------------------
Purchased:
25 Ten-Year Euro Bonds 12/00 $2,234,697 $ 17,164
Sold:
8 Five-Year U.S. Treasury Notes 12/00 805,500 (5,847)
9 Ten-Year Australian
Government Bonds 12/00 666,186 (3,475)
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
--------------------------------------------------------------------------------
Settlement Unrealized
Date Value in USD Appreciation
--------------------------------------------------------------------------------
Sold:
2,865,000 AUD 8/07/01 $1,492,379 $ 185,939
1,870,000 EUR 8/07/01 1,604,211 117,311
1,525,000 GBP 12/27/00 2,210,472 93,803
595,000 NZD 2/07/01 235,852 34,873
--------------------------------------------------------------------------------
CURRENCY ABBREVIATIONS
--------------------------------------------------------------------------------
AUD -- Australian Dollar
CAD -- Canadian Dollar
DKK -- Danish Krone
EUR -- Euro
FIM -- Finnish Mark
GBP -- British Pound
JPY -- Japanese Yen
NZD -- New Zealand Dollar
USD -- United States Dollar
LEGEND
--------------------------------------------------------------------------------
(a) Short-term investments include any security which has a remaining maturity
of less than one year.
(b) Non-income producing security.
(c) All or a portion of security pledged or segregated to cover margin
requirements for futures contracts or when-issued securities.
(d) Restricted security.
(e) Affiliated Issuer (See Note 7 of Notes to Financial Statements.)
(f) All or a portion of security is when-issued.
Percentages are stated as a percent of net assets.
See Notes to Financial Statements.
20
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
--------------------------------------------------------------------------------
October 31, 2000
<TABLE>
<CAPTION>
(In Thousands, Except per Share Amounts)
Strong
Foreign Strong Strong
Strong Asia Major Markets International Overseas
Pacific Fund Fund Stock Fund Fund
------------ ------------- ------------- --------
<S> <C> <C> <C> <C>
Assets:
Investments in Securities, at Value
Unaffiliated Issuers (Cost of $62,166, $3,333,
$94,307 and $47,783, respectively) $ 57,427 $ 3,174 $ 122,514 $ 44,790
Affiliated Issuers (Cost of $0, $0, $635 and $0, respectively) -- -- 635 --
Receivable for Securities 568 7 301 126
Receivable for Fund Shares Sold 28 -- 190 41
Dividends and Interest Receivable 63 5 153 45
Other Assets 131 7 92 11
--------- --------- --------- ---------
Total Assets 58,217 3,193 123,885 45,013
Liabilities:
Payable for Securities and Forward
Foreign Currency Contracts Purchased 370 10 448 162
Payable for Fund Shares Redeemed 544 -- 433 99
Accrued Operating Expenses and Other Liabilities 48 1 88 32
--------- --------- --------- ---------
Total Liabilities 962 11 969 293
--------- --------- --------- ---------
Net Assets $ 57,255 $ 3,182 $ 122,916 $ 44,720
========= ========= ========= =========
Net Assets Consist of:
Capital Stock (par value and paid-in capital) $ 64,150 $ 3,387 $ 136,441 $ 58,095
Undistributed Net Investment Income 1,351 -- -- --
Accumulated Net Realized Loss (3,495) (45) (41,705) (10,380)
Net Unrealized Appreciation (Depreciation) (4,751) (160) 28,180 (2,995)
--------- --------- --------- ---------
Net Assets $ 57,255 $ 3,182 $ 122,916 $ 44,720
========= ========= ========= =========
Capital Shares Outstanding (Unlimited Number Authorized) 7,350 314 9,186 2,948
Net Asset Value Per Share $ 7.79 $ 10.14 $ 13.38 $ 15.17
========= ========= ========= =========
</TABLE>
See Notes to Financial Statements.
21
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES (continued)
--------------------------------------------------------------------------------
October 31, 2000
<TABLE>
<CAPTION>
(In Thousands, Except per Share Amounts)
Strong Strong Short-
International Term Global
Bond Fund Bond Fund
-------------- --------------
<S> <C> <C>
Assets:
Investments in Securities, at Value (Cost of $16,594 and $54,014, respectively) $ 14,153 $ 53,427
Receivable for Securities and Forward Foreign Currency Contracts Sold 65 432
Receivable for Fund Shares Sold 1 2
Interest Receivable 348 516
Paydown Receivable -- 27
Variation Margin Receivable -- 2
Other Assets 4 8
-------- --------
Total Assets 14,571 54,414
Liabilities:
Payable for Securities and Forward Foreign Currency Contracts Purchased 282 2,987
Payable for Fund Shares Redeemed 15 --
Dividends Payable -- 254
Accrued Operating Expenses and Other Liabilities 18 29
-------- --------
Total Liabilities 315 3,270
-------- --------
Net Assets $ 14,256 $ 51,144
======== ========
Net Assets Consist of:
Capital Stock (par value and paid-in capital) $ 17,349 $ 55,226
Undistributed Net Investment Income 255 361
Accumulated Net Realized Loss (739) (4,289)
Net Unrealized Depreciation (2,609) (154)
-------- --------
Net Assets $ 14,256 $ 51,144
======== ========
Capital Shares Outstanding (Unlimited Number Authorized) 1,565 5,046
Net Asset Value Per Share $ 9.11 $ 10.14
======== ========
</TABLE>
See Notes to Financial Statements.
22
<PAGE>
STATEMENTS OF OPERATIONS
--------------------------------------------------------------------------------
For the Year Ended October 31, 2000
<TABLE>
<CAPTION>
(In Thousands)
Strong
Foreign Strong Strong
Strong Asia MajorMarkets International Overseas
Pacific Fund Fund Stock Fund Fund
------------ ------------ ------------- --------
<S> <C> <C> <C> <C>
Income:
Dividends (net of foreign withholding taxes of
$272, $2, $111 and $37, respectively) $ 1,121 $ 35 $ 1,332 $ 449
Interest 308 12 187 221
------------ ------------ ------------- --------
Total Income 1,429 47 1,519 670
Expenses:
Investment Advisory Fees 1,025 33 1,655 462
Custodian Fees 236 62 220 100
Shareholder Servicing Costs 283 12 504 158
Interest Expense 17 1 140 1
Professional Fees 22 11 37 10
Reports to Shareholders 90 6 131 49
Federal and State Registration Fees 47 9 21 25
Other 7 2 10 7
------------ ------------ ------------- --------
Total Expenses before Waivers and Absorptions 1,727 136 2,718 812
Involuntary Expense Waivers and Absorptions by Advisor -- (70) -- (16)
------------ ------------ ------------- --------
Expenses, Net 1,727 66 2,718 796
------------ ------------ ------------- --------
Net Investment Loss (298) (19) (1,199) (126)
Realized and Unrealized Gain (Loss):
Net Realized Gain (Loss) on:
Investments 3,675 (85) 18,218 (9,739)
Futures Contracts and Forward Foreign
Currency Contracts -- 44 597 (398)
Foreign Currencies 3 -- (12) (4)
------------ ------------ ------------- --------
Net Realized Gain (Loss) 3,678 (41) 18,803 (10,141)
Net Change in Unrealized Appreciation/Depreciation on:
Investments (10,336) (291) (12,214) (5,162)
Futures Contracts and Forward Foreign
Currency Contracts -- (7) 80 2
Foreign Currencies (23) -- (21) (2)
------------ ------------ ------------- --------
Net Change in Unrealized Appreciation/Depreciation (10,359) (298) (12,155) (5,162)
------------ ------------ ------------- --------
Net Gain (Loss) on Investments (6,681) (339) 6,648 (15,303)
------------ ------------ ------------- --------
Net Increase (Decrease) in Net Assets
Resulting from Operations ($ 6,979) ($ 358) $ 5,449 ($15,429)
============ ============ ============= ========
</TABLE>
See Notes to Financial Statements.
23
<PAGE>
STATEMENTS OF OPERATIONS (continued)
--------------------------------------------------------------------------------
For the Year Ended October 31, 2000
<TABLE>
<CAPTION>
(In Thousands)
Strong
Strong Short-Term
International Global
Bond Fund Bond Fund
-------------- ------------
<S> <C> <C>
Interest Income $ 975 $ 3,260
Expenses:
Investment Advisory Fees 108 300
Custodian Fees 41 50
Shareholder Servicing Costs 53 120
Professional Fees 15 16
Reports to Shareholders 18 34
Federal and State Registration Fees 21 23
Other 4 9
-------------- -------------
Total Expenses 260 552
-------------- -------------
Net Investment Income 715 2,708
Realized and Unrealized Gain (Loss):
Net Realized Gain (Loss) on:
Investments (693) (646)
Futures Contracts and Forward Foreign Currency Contracts 478 628
Foreign Currencies (40) (9)
-------------- -------------
Net Realized Loss (255) (27)
Net Change in Unrealized Appreciation/Depreciation on:
Investments (1,306) (352)
Futures Contracts and Forward Foreign Currency Contracts (868) 395
Foreign Currencies (12) (7)
-------------- -------------
Net Change in Unrealized Appreciation/Depreciation (2,186) 36
-------------- -------------
Net Gain (Loss) on Investments (2,441) 9
-------------- -------------
Net Increase (Decrease) in Net Assets Resulting from Operations ($ 1,726) $ 2,717
============== =============
</TABLE>
See Notes to Financial Statements.
24
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
(In Thousands)
Strong Foreign
Strong Asia Pacific Fund MajorMarkets Fund
------------------------------- ----------------------------
Year Ended Year Ended Year Ended Year Ended
Oct. 31, 2000 Oct. 31, 1999 Oct. 31, 2000 Oct. 31, 1999
-------------- -------------- ------------- -------------
<S> <C> <C> <C> <C>
Operations:
Net Investment Income (Loss) ($ 298) $ 128 ($ 19) $ 4
Net Realized Gain (Loss) 3,678 18,157 (41) 212
Net Change in Unrealized Appreciation/Depreciation (10,359) 7,815 (298) 215
--------- --------- --------- ----------
Net Increase (Decrease) in Net Assets Resulting
from Operations (6,979) 26,100 (358) 431
Distributions:
From Net Investment Income (4,599) -- (4) --
From Net Realized Gains -- -- (190) --
--------- --------- --------- ----------
Total Distributions (4,599) -- (194) --
Capital Share Transactions:
Proceeds from Shares Sold 282,329 237,030 9,615 2,771
Proceeds from Reinvestment of Distributions 4,359 -- 191 --
Payment for Shares Redeemed (321,260) (181,435) (8,095) (2,643)
--------- --------- --------- ----------
Net Increase (Decrease) in Net Assets
from Capital Share Transactions (34,572) 55,595 1,711 128
--------- --------- --------- ----------
Total Increase (Decrease) in Net Assets (46,150) 81,695 1,159 559
Net Assets:
Beginning of Year 103,405 21,710 2,023 1,464
--------- --------- --------- ----------
End of Year $ 57,255 $ 103,405 $ 3,182 $ 2,023
======== ========= ======== ==========
Transactions in Shares of the Fund:
Sold 28,032 28,350 786 265
Issued in Reinvestment of Distributions 374 -- 14 --
Redeemed (31,804) (21,597) (658) (250)
--------- --------- --------- ----------
Net Increase (Decrease) in Shares of the Fund (3,398) 6,753 142 15
========= ========= ========= ==========
</TABLE>
See Notes to Financial Statements.
25
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS (continued)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
(In Thousands)
Strong International Stock Fund Strong Overseas Fund
-------------------------------- -----------------------------
Year Ended Year Ended Year Ended Year Ended
Oct. 31, 2000 Oct. 31, 1999 Oct. 31, 2000 Oct. 31, 1999
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Operations:
Net Investment Loss ($ 1,199) ($ 701) ($ 126) ($ 40)
Net Realized Gain (Loss) 18,803 (204) (10,141) 262
Net Change in Unrealized Appreciation/Depreciation (12,155) 39,468 (5,162) 2,113
----------- ----------- ---------- ---------
Net Increase (Decrease) in Net Assets Resulting
from Operations 5,449 38,563 (15,429) 2,335
Distributions In Excess of Net Investment Income -- (571) -- --
Capital Share Transactions:
Proceeds from Shares Sold 481,426 150,687 116,364 9,498
Proceeds from Reinvestment of Distributions -- 554 -- --
Payment for Shares Redeemed (476,376) (172,836) (63,466) (7,309)
----------- ----------- ---------- ---------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions 5,050 (21,595) 52,898 2,189
----------- ----------- ---------- ---------
Total Increase in Net Assets 10,499 16,397 37,469 4,524
Net Assets:
Beginning of Year 112,417 96,020 7,251 2,727
----------- ----------- ---------- ---------
End of Year $ 122,916 $ 112,417 $ 44,720 $ 7,251
=========== =========== ========== =========
Transactions in Shares of the Fund:
Sold 28,046 14,284 5,708 820
Issued in Reinvestment of Distributions -- 56 -- --
Redeemed (27,513) (16,416) (3,265) (647)
----------- ----------- ---------- ---------
Net Increase (Decrease) in Shares of the Fund 533 (2,076) 2,443 173
=========== =========== ========== =========
</TABLE>
See Notes to Financial Statements.
26
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS (continued)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
(In Thousands)
Strong International Strong Short-Term
Bond Fund Global Bond Fund
----------------------------- -----------------------------
Year Ended Year Ended Year Ended Year Ended
Oct. 31, 2000 Oct. 31, 1999 Oct. 31, 2000 Oct. 31, 1999
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Operations:
Net Investment Income $ 715 $ 881 $ 2,708 $ 2,986
Net Realized Gain (Loss) (255) 171 (27) (246)
Net Change in Unrealized Appreciation/Depreciation (2,186) (2,097) 36 813
------------- ------------- ------------- -------------
Net Increase (Decrease) in Net Assets Resulting
from Operations (1,726) (1,045) 2,717 3,553
Distributions From Net Investment Income (900) (1,075) (3,064) (3,197)
Capital Share Transactions:
Proceeds from Shares Sold 7,783 12,058 32,615 21,365
Proceeds from Reinvestment of Distributions 825 995 2,761 3,126
Payment for Shares Redeemed (10,498) (12,320) (28,096) (56,039)
------------- ------------- ------------- -------------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions (1,890) 733 7,280 (31,548)
------------- ------------- ------------- -------------
Total Increase (Decrease) in Net Assets (4,516) (1,387) 6,933 (31,192)
Net Assets:
Beginning of Year 18,772 20,159 44,211 75,403
------------- ------------- ------------- -------------
End of Year $ 14,256 $ 18,772 $ 51,144 $ 44,211
============= ============= ============= =============
Transactions in Shares of the Fund:
Sold 804 1,111 3,211 2,089
Issued in Reinvestment of Distributions 83 89 272 306
Redeemed (1,086) (1,131) (2,768) (5,482)
------------- ------------- ------------- -------------
Net Increase (Decrease) in Shares of the Fund (199) 69 715 (3,087)
============= ============= ============= =============
</TABLE>
See Notes to Financial Statements.
27
<PAGE>
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
October 31, 2000
1. Organization
The accompanying financial statements represent the Strong International
Funds (the "Funds"), which include the following funds, each with its own
investment objectives and policies:
- Strong Asia Pacific Fund, Inc./(1)(2)/
- Strong Foreign MajorMarkets Fund/(2)/ (a series of Strong International
Equity Funds, Inc./(1)/
- Strong International Stock Fund/(2)/ (a series of Strong International
Equity Funds, Inc./(1)/
- Strong Overseas Fund/(2)/ (a series of Strong International Equity Funds,
Inc./(1)/
- Strong International Bond Fund/(3)/ (a series of Strong International
Income Funds, Inc./(1)/
- Strong Short-Term Global Bond Fund, Inc./(1)(2)/*
/(1)/ An open-end management investment company registered under the
Investment Company Act of 1940, as amended.
/(2)/ Diversified fund
/(3)/ Non-diversified fund
* Effective November 30, 2000, the Strong Short-Term Global Bond Fund
changed its name to the Strong Advisor Short Duration Bond Fund and
introduced four new classes of shares for distribution.
2. Significant Accounting Policies
The following is a summary of significant accounting policies followed by
the Funds in the preparation of their financial statements.
(A) Security Valuation -- Securities of the Funds are valued at fair value
through valuations obtained by a commercial pricing service or the
mean of the bid and asked prices when no last sales price is
available. Debt securities not traded on a principal securities
exchange are valued through valuations obtained from a commercial
pricing service, otherwise sale or bid prices are used. Securities for
which market quotations are not readily available are valued at fair
value as determined in good faith under consistently applied
procedures established by and under the general supervision of the
Board of Directors. Securities which are purchased within 60 days of
their stated maturity are valued at amortized cost, which approximates
fair value.
The Funds may own certain investment securities which are restricted
as to resale. These securities are valued after giving due
consideration to pertinent factors including recent private sales,
market conditions and the issuer's financial performance. The Funds
generally bear the costs, if any, associated with the disposition of
restricted securities. Aggregate cost and fair value of restricted
securities held at October 31, 2000 which are either 4(2) commercial
paper or are eligible for resale pursuant to Rule 144A under the
Securities Act of 1933 and have been determined to be illiquid by the
Advisor based upon guidelines established by the Funds' Board of
Directors were as follows:
Aggregate Aggregate Percent of
Cost Fair Value Net Assets
--------- ---------- ----------
Strong International Stock Fund $635,000 $635,000 0.5%
(B) Federal Income and Excise Taxes and Distributions to Shareholders --
The Funds intend to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to
distribute substantially all of their taxable income to their
shareholders in a manner which results in no tax cost to the Funds.
Therefore, no Federal income or excise tax provision is required.
Net investment income or net realized gains for financial statement
purposes may differ from the characterization for federal income tax
purposes due to differences in the recognition of income and expense
items for financial statement and tax purposes. Where appropriate,
reclassifications between net asset accounts are made for such
differences that are permanent in nature.
Strong Short-Term Global Bond Fund pays dividends from net investment
income monthly, Strong International Bond Fund pays dividends from net
investment income quarterly, and Strong Asia Pacific Fund, Strong
Foreign MajorMarkets Fund, Strong International Stock Fund and Strong
Overseas Fund pay dividends from net investment income annually. The
Funds distribute any net realized capital gains annually. Strong
Short-Term Global Bond Fund declares dividends on each day that the
net asset value is calculated, except for bank holidays.
(C) Realized Gains and Losses on Investment Transactions -- Investment
security transactions are recorded as of the trade date. Gains or
losses realized on investment transactions are determined by comparing
the identified cost of the security lot sold with the net sales
proceeds.
28
<PAGE>
(D) Certain Investment Risks -- The Funds may utilize derivative
instruments including options, futures and other instruments with
similar characteristics to the extent that they are consistent with
the Funds' investment objectives and limitations. The Funds intend to
use such derivative instruments primarily to hedge or protect from
adverse movements in securities prices or interest rates. The use of
these instruments may involve risks such as the possibility of
illiquid markets or imperfect correlation between the value of the
instruments and the underlying securities, or that the counterparty
will fail to perform its obligations.
Investments in foreign denominated assets or forward currency
contracts may involve greater risks than domestic investments due to
currency, political, economic, regulatory and market risks.
(E) Futures -- Upon entering into a futures contract, the Funds pledge to
the broker cash or other investments equal to the minimum "initial
margin" requirements of the exchange. Additional securities held by
the Funds may be designated as collateral on open futures contracts.
The Funds also receive from or pay to the broker an amount of cash
equal to the daily fluctuation in the value of the contract. Such
receipts or payments are known as "variation margin," and are recorded
as unrealized gains or losses. When the futures contract is closed, a
realized gain or loss is recorded 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.
(F) Options -- The Funds may write put or call options (none were written
during the period). Premiums received by the Funds upon writing put or
call options are recorded as an asset with a corresponding liability
which is subsequently adjusted to the current market value of the
option. Changes between the initial premiums received and the current
market value of the options are recorded as unrealized gains or
losses. When an option expires, is exercised, or is closed, the Funds
realize a gain or loss, and the liability is eliminated. The Funds
continue to bear the risk of adverse movements in the price of the
underlying asset during the period of the option, although any
potential loss during the period would be reduced by the amount of the
option premium received. Securities held by the Funds may be
designated as collateral on written options.
(G) Foreign Currency Translation -- Investment securities and other assets
and liabilities initially expressed in foreign currencies are
converted daily to U.S. dollars based upon current exchange rates.
Purchases and sales of foreign investment securities and income are
converted to U.S. dollars based upon currency exchange rates
prevailing on the respective dates of such transactions. The effect of
changes in foreign exchange rates on realized and unrealized security
gains or losses is reflected as a component of such gains or losses.
(H) Forward Foreign Currency Exchange Contracts -- Forward foreign
currency exchange contracts are valued at the forward rate and are
marked-to-market daily. The change in market value is recorded as an
unrealized gain or loss. When the contract is closed, the Funds record
an exchange 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.
(I) Use of Estimates -- The preparation of financial statements in
conformity with accounting principles generally accepted in the United
States of America requires management to make estimates and
assumptions that affect the reported amounts in these financial
statements. Actual results could differ from those estimates.
(J) Other -- Dividend income and distributions to shareholders are
recorded on the ex-dividend date. Interest income is recorded on the
accrual basis and includes amortization of premiums and discounts.
3. Related Party Transactions
Strong Capital Management, Inc. (the "Advisor"), with whom certain officers
and directors of the Funds are affiliated, provides investment advisory
services and shareholder recordkeeping and related services to the Funds.
Investment advisory fees, which are established by terms of the Advisory
Agreements, are based on the following annualized rates of the average daily
net assets: Strong Asia Pacific Fund, Strong Foreign MajorMarkets Fund,
Strong International Stock Fund and Strong Overseas Fund 1.00%, Strong
International Bond Fund 0.70%, and Strong Short-Term Global Bond Fund
0.625%. Based on the terms of the Advisory Agreements, advisory fees and
other expenses will be waived or absorbed by the Advisor if the Fund's
operating expenses exceed 2% of the average daily net assets of the Fund. In
addition, the Fund's Advisor may voluntarily waive or absorb certain
expenses at its discretion. Shareholder recordkeeping and related service
fees are based on contractually established rates for each open and closed
shareholder account. The Advisor also allocates to each Fund certain charges
or credits resulting from transfer agency banking activities based on each
Fund's level of subscription and redemption activity. Charges allocated to
the Funds by the Advisor are included in Other Expenses in the Funds'
Statements of Operations. Credits allocated by the Advisor serve to reduce
the shareholder servicing expenses incurred by the Funds and are reported as
Fees Paid Indirectly by Advisor in the Funds' Statements of Operations. The
Advisor is also compensated for certain other services related to costs
incurred for reports to shareholders.
29
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued)
--------------------------------------------------------------------------------
October 31, 2000
The Funds may invest cash in money market funds sponsored and managed by
the Advisor, subject to certain limitations. The terms of such transactions
are identical to those of non-related entities except that, to avoid
duplicate investment advisory fees, advisory fees of each Fund are reduced
by an amount equal to advisory fees paid to the Advisor under its
investment advisory agreement with the money market funds.
Certain information regarding related party transactions, excluding the
effect of waivers and absorptions, for the year ended October 31, 2000 is
as follows:
<TABLE>
<CAPTION>
Shareholder
Payable to Servicing and Transfer Agency Unaffiliated
Advisor at Other Expenses Banking Directors'
October 31, 2000 Paid to Advisor Charges/(Credits) Fees
---------------- --------------- ----------------- ------------
<S> <C> <C> <C> <C>
Strong Asia Pacific Fund $ 21,037 $283,995 ($ 214) $ 2,764
Strong Foreign MajorMarkets Fund -- 11,603 1,676 814
Strong International Stock Fund 44,970 505,418 527 3,432
Strong Overseas Fund 16,736 158,189 4,080 1,042
Strong International Bond Fund 4,625 53,287 1,663 1,037
Strong Short-Term Global Bond Fund 9,783 120,115 5,110 1,432
</TABLE>
The Advisor owns 36.2% of Strong Foreign MajorMarkets Fund at October 31,
2000.
4. Line of Credit
The Strong Funds have established a line of credit agreement ("LOC") with
certain financial institutions to be used for temporary or emergency
purposes, primarily for financing redemption payments. Combined borrowings
among all participating Strong Funds are subject to a $350 million cap on
the total LOC. For an individual fund, borrowings under the LOC are limited
to either the lesser of 15% of the market value of the Fund's total assets
or any explicit borrowing limits in the Funds' prospectus. Principal and
interest on each borrowing under the LOC are due not more than 60 days
after the date of the borrowing. Borrowings under the LOC bear interest
based on prevailing market rates as defined in the LOC. A commitment fee of
0.09% per annum is incurred on the unused portion of the LOC and is
allocated to all participating Strong Funds. During the year ended October
31, 2000, the Strong Asia Pacific Fund, Strong Foreign MajorMarkets Fund,
Strong International Stock Fund and Strong Overseas Fund had an outstanding
average daily balance of $260,822, $18,630, $2,089,315 and $18,082,
respectively, under the LOC. The maximum amount outstanding for each Fund
during that period was $7,200,000, $300,000, $16,700,000 and $1,200,000,
respectively. Interest expense for each Fund amounted to $17,281, $1,254,
$139,739 and $1,291, respectively, for the year ended October 31, 2000. At
October 31, 2000, there were no borrowings by the Funds under the LOC.
5. Investment Transactions
The aggregate purchases and sales of long-term securities for the year
ended October 31, 2000 were as follows:
<TABLE>
<CAPTION>
Purchases Sales
---------------------------- ----------------------------
U.S. Government U.S. Government
and Agency Other and Agency Other
--------------- ----------- --------------- -----------
<S> <C> <C> <C> <C>
Strong Asia Pacific Fund -- $171,946,620 $ -- $194,894,078
Strong Foreign MajorMarkets Fund -- 5,613,225 -- 4,371,994
Strong International Stock Fund -- 163,820,728 -- 159,870,383
Strong Overseas Fund -- 101,265,892 -- 48,861,162
Strong International Bond Fund -- 10,978,720 253,640 11,483,807
Strong Short-Term Global Bond Fund -- 19,740,766 4,167,980 16,072,373
</TABLE>
6. Income Tax Information
At October 31, 2000, the investment cost, gross unrealized appreciation and
depreciation on investments and capital loss carryovers (expiring in
varying amounts through 2008) for federal income tax purposes were as
follows:
<TABLE>
<CAPTION>
Federal Tax Unrealized Unrealized Net Appreciation/ Net Capital Loss
Cost Appreciation Depreciation (Depreciation) Carryovers
----------- ------------ ------------ ---------------- ----------------
<S> <C> <C> <C> <C> <C>
Strong Asia Pacific Fund $ 62,704,217 $ 3,437,214 $ 8,714,880 ($ 5,277,666) $ 3,069,001
Strong Foreign MajorMarkets Fund 3,358,773 184,551 369,409 (184,858) 18,367
Strong International Stock Fund 95,670,633 37,732,436 10,254,154 27,478,282 40,932,613
Strong Overseas Fund 48,352,334 3,323,290 6,885,721 (3,562,431) 9,790,767
Strong International Bond Fund 16,682,222 87,860 2,617,550 (2,529,690) 650,500
Strong Short-Term Global Bond Fund 54,014,115 265,960 853,329 (587,369) 4,289,428
</TABLE>
The Strong International Stock Fund and the Strong International Bond Fund
utilized $18,529,299 and $293,628, respectively, of their capital loss
carryovers during the year ended October 31, 2000.
30
<PAGE>
For corporate shareholders in the Funds, the percentages of dividend income
distributed for the year ended October 31, 2000, which is designated as
qualifying for the dividends-received deduction, are as follows (unaudited):
Strong Asia Pacific Fund 0.0%, Strong Foreign MajorMarkets Fund 0.0%, Strong
International Stock Fund 0.0%, Strong Overseas Fund 0.0%, Strong
International Bond Fund 0.0%, and Strong Short-Term Global Bond Fund 0.0%.
7. Investments in Affiliates
Affiliated issuers, as defined under the Investment Company Act of 1940,
include those in which the Fund's holdings of an issuer represent 5% or more
of the outstanding voting securities of the issuer and any other Strong
Fund. A summary of transactions in the securities of these issuers during
the year ended October 31, 2000 is as follows:
<TABLE>
<CAPTION>
Balance of Gross Gross Sales Balance of Value Dividend Income
Shares Held Purchases and Shares Held Oct. 31, Nov. 1, 1999-
Nov. 1, 1999 and Additions Reductions Oct. 31, 2000 2000 Oct. 31, 2000
------------ ------------- ---------- ------------- -------- --------------
<S> <C> <C> <C> <C> <C> <C>
Strong International Stock Fund
-------------------------------
Connemara Green Marble Quarries PLC 50,800 -- -- 50,800 $635,000 --
Connemara Green Marble Quarries PLC
Warrants 8,000 -- -- 8,000 -- --
</TABLE>
31
<PAGE>
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
STRONG ASIA PACIFIC FUND
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended
-----------------------------------------------------------
Oct. 31, Oct. 31, Oct. 31, Oct. 31, Oct. 31,
Selected Per-Share Data/(a)/ 2000 1999 1998 1997 1996
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 9.62 $ 5.43 $ 7.35 $ 9.51 $ 9.55
Income From Investment Operations:
Net Investment Income (Loss) (0.19) 0.05 0.07 0.01 0.06
Net Realized and Unrealized Gains (Losses) on Investments (1.24) 4.14 (1.90) (2.01) 0.31
------------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations (1.43) 4.19 (1.83) (2.00) 0.37
Less Distributions:
From Net Investment Income (0.40) -- (0.07) (0.01) (0.06)
In Excess of Net Investment Income -- -- (0.02) (0.03) (0.35)
From Net Realized Gains -- -- -- (0.10) --
In Excess of Net Realized Gains -- -- -- (0.02) --
------------------------------------------------------------------------------------------------------------------------------------
Total Distributions (0.40) -- (0.09) (0.16) (0.41)
------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 7.79 $ 9.62 $ 5.43 $ 7.35 $ 9.51
====================================================================================================================================
Ratios and Supplemental Data
------------------------------------------------------------------------------------------------------------------------------------
Total Return -16.2% +77.2% -25.1% -21.5% +3.8%
Net Assets, End of Period (In Millions) $ 57 $ 103 $ 22 $ 30 $ 72
Ratio of Expenses to Average Net Assets without
Waivers and Absorptions 1.7% 2.0% 2.0% 2.0% 2.0%
Ratio of Expenses to Average Net Assets 1.7% 1.7% 2.0% 2.0% 2.0%
Ratio of Net Investment Income (Loss) to Average Net Assets (0.3%) 0.2% 1.1% 0.1% 2.0%
Portfolio Turnover Rate 181.5% 206.1% 192.9% 96.7% 91.4%
</TABLE>
<TABLE>
<CAPTION>
STRONG FOREIGN MAJORMARKETS FUND
------------------------------------------------------------------------------------------------------------------
Year Ended
---------------------------------------------
Oct. 31, Oct. 31, Oct. 31,
Selected Per-Share Data/(a)/ 2000 1999 1998/(b)/
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net Asset Value, Beginning of Period $ 11.78 $ 9.31 $ 0.00
Income From Investment Operations:
Net Investment Income (Loss) (0.06) 0.03 (0.01)
Net Realized and Unrealized Gains (Losses) on Investments (0.52) 2.44 (0.68)
------------------------------------------------------------------------------------------------------------------
Total from Investment Operations (0.58) 2.47 (0.69)
Less Distributions:
From Net Investment Income (0.03) -- --
From Net Realized Gains (1.03) -- --
------------------------------------------------------------------------------------------------------------------
Total Distributions (1.06) -- --
------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 10.14 $ 11.78 $ 9.31
==================================================================================================================
Ratios and Supplemental Data
------------------------------------------------------------------------------------------------------------------
Total Return -6.9% +26.5% -6.9%
Net Assets, End of Period (In Millions) $3 $2 $1
Ratio of Expenses to Average Net Assets without
Waivers and Absorptions 2.0% 2.0% 2.0%*
Ratio of Expenses to Average Net Assets 2.0% 2.0% 2.0%*
Ratio of Net Investment Income (Loss) to Average Net Assets (0.6%) 0.2% (0.5%)*
Portfolio Turnover Rate 143.9% 144.5% 16.5%
</TABLE>
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) For the period from June 30, 1998 (inception) to October 31, 1998.
See Notes to Financial Statements.
32
<PAGE>
FINANCIAL HIGHLIGHTS (continued)
--------------------------------------------------------------------------------
STRONG INTERNATIONAL STOCK FUND
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended
---------------------------------------------------------------------
Oct. 31, Oct. 31, Oct. 31, Oct. 31, Oct. 31,
Selected Per-Share Data/(a)/ 2000 1999 1998 1997 1996
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $12.99 $ 8.95 $11.99 $13.75 $13.03
Income From Investment Operations:
Net Investment Income (Loss) (0.13) (0.09) 0.00/(b)/ 0.01 0.17
Net Realized and Unrealized Gains (Losses) on Investments 0.52 4.19 (2.48) (0.69) 1.11
------------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 0.39 4.10 (2.48) (0.68) 1.28
Less Distributions:
From Net Investment Income -- -- (0.00)/(b)/ (0.01) (0.18)
In Excess of Net Investment Income -- (0.06) (0.30) (0.26) (0.38)
From Net Realized Gains -- -- (0.26) (0.81) --
------------------------------------------------------------------------------------------------------------------------------------
Total Distributions -- (0.06) (0.56) (1.08) (0.56)
------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $13.38 $12.99 $ 8.95 $11.99 $13.75
====================================================================================================================================
Ratios and Supplemental Data
------------------------------------------------------------------------------------------------------------------------------------
Total Return +3.0% +46.0% -21.4% -5.7% +9.8%
Net Assets, End of Period (In Millions) $123 $112 $96 $180 $304
Ratio of Expenses to Average Net Assets 1.6% 1.8% 1.9% 1.6% 1.7%
Ratio of Net Investment Income (Loss) to Average Net Assets (0.7%) (0.7%) (0.1%) 0.5% 0.6%
Portfolio Turnover Rate 100.2% 84.9% 228.2% 143.7% 108.6%
</TABLE>
STRONG OVERSEAS FUND
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended
----------------------------------------
Oct. 31, Oct. 31, Oct. 31,
Selected Per-Share Data/(a)/ 2000 1999 1998/(c)/
----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net Asset Value, Beginning of Period $14.37 $ 8.20 $10.00
Income From Investment Operations:
Net Investment Loss (0.04) (0.08) (0.02)
Net Realized and Unrealized Gains (Losses) on Investments 0.84 6.25 (1.78)
----------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 0.80 6.17 (1.80)
Less Distributions:
From Net Investment Income -- -- --
----------------------------------------------------------------------------------------------------------------------
Total Distributions -- -- --
----------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $15.17 $14.37 $ 8.20
======================================================================================================================
Ratios and Supplemental Data
----------------------------------------------------------------------------------------------------------------------
Total Return +5.6% +75.2% -18.0%
Net Assets, End of Period (In Millions) $45 $7 $3
Ratio of Expenses to Average Net Assets without Waivers and Absorptions 1.8% 2.0% 2.0%*
Ratio of Expenses to Average Net Assets 1.7% 2.0% 2.0%*
Ratio of Net Investment Loss to Average Net Assets (0.3%) (0.9%) (0.7%)*
Portfolio Turnover Rate 116.6% 106.4% 59.5%
</TABLE>
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) Amount calculated is less than $0.01.
(c) For the period from June 30, 1998 (inception) to October 31, 1998.
See Notes to Financial Statements.
33
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS (continued)
-----------------------------------------------------------------------------------------------------------------------------------
STRONG INTERNATIONAL BOND FUND
-----------------------------------------------------------------------------------------------------------------------------------
Year Ended
---------------------------------------------------------
Oct. 31, Oct. 31, Oct. 31, Oct. 31, Oct. 31,
Selected Per-Share Data/(a)/ 2000 1999 1998 1997 1996
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 10.64 $ 11.89 $ 11.58 $ 11.87 $ 11.48
Income From Investment Operations:
Net Investment Income 0.40 0.54 0.57 1.03 0.80
Net Realized and Unrealized Gains (Losses) on Investments (1.42) (1.14) 0.58 (1.11) 0.15
-----------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations (1.02) (0.60) 1.15 (0.08) 0.95
Less Distributions:
From Net Investment Income (0.51) (0.65) (0.58) (0.20) (0.50)
From Net Realized Gains -- -- -- -- (0.06)
In Excess of Net Realized Gains -- -- (0.26) (0.01) --
-----------------------------------------------------------------------------------------------------------------------------------
Total Distributions (0.51) (0.65) (0.84) (0.21) (0.56)
-----------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 9.11 $ 10.64 $ 11.89 $ 11.58 $ 11.87
===================================================================================================================================
Ratios and Supplemental Data
-----------------------------------------------------------------------------------------------------------------------------------
Total Return -10.0% -5.3% +10.9% -0.7% +8.6%
Net Assets, End of Period (In Millions) $14 $19 $20 $28 $31
Ratio of Expenses to Average Net Assets without Waivers and
Absorptions 1.7% 1.6% 1.6% 1.5% 1.8%
Ratio of Expenses to Average Net Assets 1.7% 1.6% 1.5% 0.7% 0.0%
Ratio of Net Investment Income to Average Net Assets 4.6% 4.7% 5.3% 8.1% 7.4%
Portfolio Turnover Rate 83.5% 45.7% 158.8% 208.4% 258.3%
</TABLE>
<TABLE>
<CAPTION>
STRONG SHORT-TERM GLOBAL BOND FUND
-----------------------------------------------------------------------------------------------------------------------------------
Year Ended
---------------------------------------------------------
Oct. 31, Oct. 31, Oct. 31, Oct. 31, Oct. 31,
Selected Per-Share Data/(a)/ 2000 1999 1998 1997 1996
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 10.21 $ 10.17 $ 10.48 $ 10.74 $ 10.46
Income From Investment Operations:
Net Investment Income 0.56 0.68 0.60 0.81 0.71
Net Realized and Unrealized Gains (Losses) on Investments 0.02 (0.02) (0.21) (0.10) 0.34
-----------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 0.58 0.66 0.39 0.71 1.05
Less Distributions:
From Net Investment Income (0.65) (0.62) (0.59) (0.85) (0.77)
In Excess of Net Investment Income -- -- (0.03) (0.12) --
From Net Realized Gains -- -- (0.08) -- --
-----------------------------------------------------------------------------------------------------------------------------------
Total Distributions (0.65) (0.62) (0.70) (0.97) (0.77)
--------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 10.14 $ 10.21 $ 10.17 $ 10.48 $ 10.74
===================================================================================================================================
Ratios and Supplemental Data
-----------------------------------------------------------------------------------------------------------------------------------
Total Return +5.8% +6.7% +3.8% +6.8% +10.4%
Net Assets, End of Period (In Millions) $ 51 $ 44 $ 75 $ 116 $ 71
Ratio of Expenses to Average Net Assets without Waivers and
Absorptions 1.1% 1.1% 1.0% 1.0% 1.5%
Ratio of Expenses to Average Net Assets 1.1% 1.1% 0.9% 0.7% 0.0%
Ratio of Net Investment Income to Average Net Assets 5.6% 5.6% 5.7% 7.6% 7.4%
Portfolio Turnover Rate 59.3% 73.1% 145.2% 168.0% 179.7%
</TABLE>
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
See Notes to Financial Statements.
34
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
--------------------------------------------------------------------------------
To the Shareholders and Board of Directors of
Strong International Funds
In our opinion, the accompanying statement of assets and liabilities, including
the schedule of investments in securities, and the related statements of
operations and of changes in net assets and the financial highlights present
fairly, in all material respects, the financial position of Strong Foreign
MajorMarkets Fund, Strong International Stock Fund, Strong Overseas Fund, (three
of the portfolios constituting the Strong International Equity Funds, Inc.),
Strong International Bond Fund (one of the portfolios constituting the Strong
International Income Funds, Inc.), Strong Asia Pacific Fund, Inc. and Strong
Short-Term Global Bond Fund, Inc. (all six collectively referred to herein as
the "Strong International Funds") at October 31, 2000, the results of each of
their operations, the changes in each of their net assets and their financial
highlights for the periods indicated, in conformity with accounting principles
generally accepted in the United States of America. These financial statements
and financial highlights (hereafter referred to as "financial statements") are
the responsibility of Strong International Fund's management; our responsibility
is to express an opinion on these financial statements based on our audits. We
conducted our audits of these financial statements in accordance with auditing
standards generally accepted in the United States of America which require that
we plan and perform the audits to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits, which included confirmation
of securities at October 31, 2000 by correspondence with the custodian and
brokers, provides a reasonable basis for our opinion.
Milwaukee, Wisconsin
December 5, 2000
35
<PAGE>
Directors
Richard S. Strong
Willie D. Davis
Stanley Kritzik
Neal Malicky
Marvin E. Nevins
William F. Vogt
Officers
Richard S. Strong, Chairman of the Board
Elizabeth N. Cohernour, Vice President and Secretary
Cathleen A. Ebacher, Vice President and Assistant Secretary
Susan A. Hollister, Vice President and Assistant Secretary
Dennis A. Wallestad, Vice President
Thomas M. Zoeller, Vice President
John W. Widmer, Treasurer
Rhonda K. Haight, Assistant Treasurer
Investment Advisor
Strong Capital Management, Inc.
P.O. Box 2936, Milwaukee, Wisconsin 53201
Distributor
Strong Investments, Inc.
P.O. Box 2936, Milwaukee, Wisconsin 53201
Custodian
Brown Brothers Harriman & Co.
40 Water Street, Boston, MA 02109
Transfer Agent and Dividend-Disbursing Agent
Strong Capital Management, Inc.
P.O. Box 2936, Milwaukee, Wisconsin 53201
Independent Accountants
PricewaterhouseCoopers LLP
100 East Wisconsin Avenue, Milwaukee, Wisconsin 53202
Legal Counsel
Godfrey & Kahn, S.C.
780 North Water Street, Milwaukee, Wisconsin 53202
<PAGE>
For a prospectus containing more complete information, including management fees
and expenses, please call 1-800-368-1030. Please read it carefully before
investing or sending money. This report does not constitute an offer for the
sale of securities. Strong Funds are offered for sale by prospectus only. Strong
Investments, Inc. RT8697-1200
Strong Investments
P.O. Box 2936 | Milwaukee, WI 53201
www.eStrong.com
--------------------------------------------------------------------------------
To order a free prospectus kit, call
1-800-368-1030
To learn more about our funds, discuss an existing
account, or conduct a transaction, call
1-800-368-3863
If you are a Financial Professional, call
1-800-368-1683
Visit our web site at
www.eStrong.com
[LOGO HERE] STRONG
