Calvert Capital Accumulation Fund
Annual Report
September 30, 1995
Investing with Vision (TM) (logo) Calvert Group(R)
A member of the Acacia Group(R)
To Open an Account:
800-368-2748
Yields and Prices:
Calvert Information Network
24 hours, 7 days a week
800-368-2745
Service for
Existing Account:
Shareholders: 800-368-2745
Brokers: 800-368-2746
TDD for Hearing
Impaired:
800-541-1524
Branch Office:
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
Registered, Certified
or Overnight Mail:
Calvert Group
c/o NFDS, 6th Floor
1004 Baltimore
Kansas City, MO 64105-1807
Principal
Underwriter:
Calvert Distributors, Inc.
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
This report is intended to provide fund information to shareholders.
It is not authorized for distribution to prospective investors unless
preceded or accompanied by a prospectus.
Annual Report_September 30, 1995
CalverT
Capital Accumulation Fund
Dear Shareholder:
This report for the Calvert Capital Accumulation Fund covers the
fiscal year ending September 30, 1995, a period when stocks rallied. The
Standard & Poor's 500(R) Index, which is a broad-based measure of the
leading common stocks, gained 29.71% compared to its average annual return
of 10.61% for the past 30 years. Among stocks, the best performing sectors
included those that benefited from the worldwide technology boom, such as
manufacturers of semiconductors, software and devices used in the
healthcare field. Lagging industries included transportation, heavy
equipment and steel.
Fund Performance
Investors in the Calvert Capital Accumulation Fund were rewarded with
strongly positive returns for the 11 months since the Fund's inception
through September 30, 1995. The Fund's 43.40% return was well ahead of its
benchmark.
Each of the Fund's three investment managers made a substantial
contribution to the overall return. For the period covered by this report,
Apodaca-Johnston Capital Management, Inc. generated a return of 49.78%;
Brown Capital Management, Inc. generated a return of 40.97%; and Fortaleza
Asset Management, Inc. generated a return of 41.36%. (Managers' returns do
not reflect the deduction of any Fund expenses, fees or sales charges.)
Fund Manager's Approach
Apodaca-Johnston Capital Management, Inc.
Apodaca-Johnston's investment approach emphasizes young,
entrepreneurial companies that exhibit rapid earnings growth. Typically,
these companies have market capitalizations (share price times number of
shares outstanding) of less than $600 million.
Investment Performance
From 10/31/94 through 9/30/95
Capital Accumulation Fund 43.40%
S&P MidCap 400 24.41%
Russell 2000 21.71%
Investment performance is for Class A shares and does not reflect the
deduction of any front-end sales charges.
During the period covered in this report, the portion of the Portfolio
managed by Apodaca-Johnston Capital Management, Inc. was heavily weighted
in technology and healthcare issues, two of the better performing
industries. Apodaca-Johnston believes the "Information Age" is upon us and
a multitude of businesses (telecommunications, multimedia, education,
computer graphics and computer networking) are benefiting from this
long-term trend. One stock we like in this area is LoJack which makes a
device that transmits a signal so police can recover stolen vehicles.
Another major theme is the "Graying of America," which makes generic drug
companies, medical information systems, HMOs and nursing and acute-care
facilities exciting industries. One favorite in this sector is Columbia
Labs which makes a unique estrogen-delivery system that is more efficiently
absorbed than tablets.
The firm's outlook for the stock market is positive, especially for
the long term. Small-cap equities, our specialty, can move independently
from the rest of the equity group. The small-cap cycle, where small caps
outperform large caps, typically lasts six to seven years, and we're only
half way through. In short, we will stay fully invested through the stock
market cycle and will focus on identifying and staying with the strongest
companies in the strongest industries.
Brown Capital Management, Inc.
Brown Capital Management, Inc. focuses on buying growth companies at a
reasonable price. We pay careful attention to valuation levels, but we do
not try to time the market. This approach has produced superior returns for
Fund shareholders.
In particular, we have emphasized companies that aid in productivity
enhancement (such as technology companies) because we felt they were an
attractive area of investment opportunity. Indeed, as in the third quarter,
our investment returns benefited from this unparalleled capital spending
cycle. While we do not think this cycle has ended, we do not feel that
across the board revenue and earnings growth from these companies will
continue unabated. Stock selection in this sector will again be paramount.
Financial service companies also performed superbly. Low interest rates, a
steepening yield curve, consolidation, and management's unrelenting pursuit
of operating efficiencies continue to drive the favorable trend of these
companies.
We believe that technology will continue to do well, but stock
selection is of the utmost importance. Healthcare and long-term care
companies will continue to benefit either from what appears to be sector
rotation, or from a broadening of the market leadership. This expectation
of a rotational market with profit-taking, but no major decline, is in
keeping with our view that the market is high but not clearly overvalued.
Fortaleza Asset Management, Inc.
Fortaleza's investment approach favors small capitalization growth
companies. We have concentrated the portfolio in the technology and
healthcare sectors complimented with a few specialty retail stocks as well
as financials. This strategy has served us well every quarter, but it was
even more notable in the third quarter of 1995.
During the period covered in this report, most of our gains were in
technology, with names like Network General, Anadigics, Gasonics and
Ultratech Stepper. Some healthcare names also generated significant gains
_ Heart Technology, Imnet, Steris and Respironics. Lastly, in the
retail/restaurant area, one stock that performed very well was Daka
International.
The remainder of 1995 will be a function of how well the market
behaves during October and, obviously, the strength of the third quarter
earnings releases. We expect the Federal Reserve to ease on interest rates
in November, which should help as the year comes to a close.
Generally, we feel positive about 1996. Inflation rates throughout
much of the industrialized world should remain low, which will help
interest rates on a lower level. This should be a plus for most financial
markets. In particular, there seems to be a "friendly" interest rate
environment in the U.S., with long-term interest rates headed down in a
slower economy, less inflation going forward, and even more easing by the
Federal Reserve. Additionally, companies' fundamentals remain generally
strong, suggesting continued robust earnings growth through next year.
Finally, 1996 is an election year, which is typically a boom for the stock
market.
History does not always repeat itself. But if we use it as a guide,
1996 should be a good year for the financial markets _ though not as
spectacular
as 1995.
We appreciate your investment in the Calvert Capital Accumulation
Fund.
Sincerely,
(signature)
Clifton S. Sorrell
President
Portfolio Statistics
Ten Largest Stock Holdings
as of September 30, 1995
% of Net Assets
Imnet Systems, Inc. 1.8%
Ultratech Stepper, Inc. 1.8%
Kulicke & Soffa Inds., Inc. 1.4%
Cisco Systems, Inc. 1.3%
Cheesecake Factory, Inc. 1.2%
Softkey International, Inc. 1.2%
T. Rowe Price Associates, Inc. 1.1%
Glendale Federal Bank/Federal Savings Bank 1.1%
Bay Networks, Inc. 1.0%
Oracle Systems Corp. 1.0%
Total 12.9%
Cumulative Total Returns
for periods ended September 30, 1995
Class A Shares
Since Inception (10/31/94) 36.58%
Class C Shares
Since Inception (10/31/94) 43.67%
Calvert Capital Accumulation Fund
Comparison of changes in value of $10,000 investment
Chart 1: Comparison of changes in value of $10,000 investment
A line graph showing showing the growth of a $10,000 investment by 9/95
for:
Capital Accumulation Fund (A Shares) which grew to $13,658;
Capital Accumulation Fund (C Shares) which grew to $14,367;
S&P 500 which grew to $12,441.
Total returns assume reinvestment of dividends and, for Class A shares,
reflect the deduction of the Fund's maximum sales charge of 4.75%. No sales
charge has been applied to the index used for comparison. Past performance
is no guarantee of future results.
Report of Independent Accountants
To the Board of Directors of Calvert World Values Fund, Inc.,
and Shareholders of the Capital Accumulation Fund:
We have audited the accompanying statement of assets and liabilities
of Capital Accumulation Fund (one of the portfolios comprising Calvert
World Values Fund, Inc.), including the portfolio of investments, as of
September 30, 1995, and the related statement of operations and statement
of changes in net assets, and the financial highlights for the period
October 31, 1994 (commencement of operations) through September 30, 1995.
These financial statements and financial highlights are the responsibility
of the Fund's management. Our responsibility is to express an opinion on
these financial statements and financial highlights based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
investments owned as of September 30, 1995, by correspondence with the
custodian and brokers. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that
our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of Capital Accumulation Fund as of September 30, 1995, and the
results of its operations, the changes in its net assets, and the financial
highlights for the period referred to above, in conformity with generally
accepted accounting principles.
COOPERS & LYBRAND L.L.P.
Baltimore, Maryland
November 9, 1995
Calvert Capital Accumulation Fund
Portfolio of Investments
September 30, 1995
Equity Securities (88.9%) Shares Value
Airline (1.0%)
Atlantic Coast Airlines, Inc. <F2> 12,500 $96,875
Comair Holdings, Inc. 3,000 79,500
176,375
Biotechnology (0.8%)
Amgen, Inc. <F2> 3,000 149,625
149,625
Business Equipment and Supplies (0.4%)
U.S. Office Products Co. <F2> 4,200 63,525
63,525
Chemicals (0.6%)
Minerals Technologies, Inc. 1,100 41,388
Sigma Aldrich Corp. 1,200 58,200
99,588
Communication Equipment (5.7%)
Cidco, Inc. <F2> 3,000 105,750
Cisco Systems, Inc. <F2> 3,350 231,150
DSC Communications Corp. <F2> 2,100 124,425
Microwave Power Devices, Inc. <F2> 7,100 62,125
P-Com, Inc. <F2> 2,200 98,450
Spectrian Corp. <F2> 2,500 85,313
Tellabs, Inc. <F2> 1,600 67,400
Teltrend, Inc. <F2> 3,500 115,500
Vtel Corp. <F2> 6,000 149,250
1,039,363
Computers - Software (12.7%)
Cheyenne Software, Inc. <F2> 3,700 74,000
Compuware Corp. <F2> 4,700 103,400
Excalibur Technologies Corp. <F2> 6,500 100,750
Imnet Systems, Inc. <F2> 12,500 321,875
Legato Systems, Inc. <F2> 3,500 92,750
Manugistics Group, Inc. <F2> 5,300 80,163
MDL Information Systems, Inc. <F2> 4,600 85,675
Mercury Interactive Corp. <F2> 3,000 83,250
Microsoft Corp. <F2> 1,400 126,700
Network Express, Inc. <F2> 2,600 41,438
Network General Corp. <F2> 4,200 173,250
Number Nine Visual Technology <F2> 4,800 79,200
Oracle Systems Corp. <F2> 4,550 174,606
Simware, Inc. <F2> 3,800 $38,000
Softkey International, Inc. <F2> 5,000 221,250
Sterling Software, Inc. <F2> 2,950 134,225
Symantec Corp. <F2> 1,000 30,000
Syncronys Softcorp <F2> 3,700 55,500
Touchstone Software Corp. <F2> 8,400 90,300
Veritas Software Co. <F2> 3,000 78,000
Viasoft, Inc. <F2> 9,000 117,000
2,301,332
Computers Systems (8.3%)
Adaptive Solutions, Inc. <F2> 11,200 79,800
Asyst Technologies, Inc. <F2> 3,000 137,625
Bay Networks, Inc. <F2> 3,400 181,475
Diamond Multimedia Systems, Inc. <F2> 3,000 96,750
Discreet Logic <F2> 2,000 110,000
Gandalf Technologies, Inc. <F2> 11,000 66,688
GRC International, Inc. <F2> 3,300 75,075
Interphase Corp. <F2> 5,000 73,125
Mentor Graphics Corp. <F2> 2,000 41,750
Meridian Data, Inc. <F2> 8,600 87,075
Microcom, Inc. <F2> 8,600 162,325
Networth, Inc. <F2> 6,500 135,280
Optical Data Systems, Inc. <F2> 1,500 58,500
Rasterops <F2> 8,300 65,363
Verifone, Inc. <F2> 5,000 139,375
1,510,206
Consumer Products (0.7%)
Newell Co. 4,900 121,275
121,275
Cosmetics (0.6%)
Guest Supply, Inc. <F2> 3,500 108,063
108,063
Electrical Equipment (2.3%)
AFC Cable Systems, Inc. <F2> 5,000 86,250
Checkpoint Systems, Inc. <F2> 2,900 76,488
Kulicke & Soffa Industries, Inc. <F2> 7,000 255,500
418,238
Electronics - Defense (0.9%)
Alpha Industries, Inc. <F2> 9,000 $160,875
160,875
Electronics - Instruments (4.8%)
Intermagnetics Gen Corp. <F2> 3,835 72,386
LTX Corp. <F2> 8,500 107,313
Ultratech Stepper, Inc. <F2> 7,500 316,875
U.S. Order, Inc. <F2> 5,000 92,500
Veeco Instruments, Inc. <F2> 4,000 105,000
Videonics, Inc. <F2> 3,800 78,850
Zycon Corp. <F2> 1,900 23,275
Zygo Corp. <F2> 2,300 64,975
861,174
Electronics - Semiconductors (12.0%)
Actel Corp. <F2> 9,900 174,488
Adaptec, Inc. <F2> 2,200 90,750
Anadigics, Inc. <F2> 2,500 69,375
Brooks Automation, Inc. <F2> 4,800 103,200
Brooktree Corp. <F2> 4,100 82,000
Chips & Technologies Inc. <F2> 6,100 82,350
E M C Corp. <F2> 5,100 92,438
Flextronics International <F2> 2,800 72,100
Gasonics International, Inc. <F2> 2,900 108,025
Input/Output, Inc. <F2> 2,800 107,450
Integrated Silicon Solution <F2> 1,100 40,975
Ontrak Systems, Inc. <F2> 2,900 80,113
Photronic, Inc. <F2> 3,750 125,625
PRI Automation, Inc. <F2> 2,650 108,650
Quality Semiconductor, Inc. <F2> 4,000 65,000
Seeq Technology, Inc. <F2> 32,000 144,000
Semiconductor Packaging Materials, Inc.<F2> 7,200 84,600
Sierra Semi Conductor Corp. <F2> 2,000 98,250
Solectron Corp. <F2> 3,800 150,100
Uniphase Corp. <F2> 4,000 141,000
Vishay Intertechnology, Inc. <F2> 3,600 151,200
2,171,689
Entertainment (0.5%)
Sanctuary Woods Multimedia Corp. <F2> 14,000 98,000
98,000
Financial Services (4.4%)
First Bell Bancorp, Inc. <F2> 5,000 $65,000
First USA, Inc. 1,550 84,088
Glendale Federal Bank Federal Savings Bank <F2> 11,600 191,400
Green Tree Financial Corp. 2,100 128,100
ISB Financial Corp. 5,300 83,475
T. Rowe Price Associates, Inc. 3,800 194,750
Roosevelt Financial Group, Inc. <F2> 2,400 42,300
789,113
Health Care (4.6%)
American Homepatient, Inc. <F2> 2,500 63,750
CRA Managed Care, Inc. <F2> 4,000 86,500
Health Care & Retirement Corp. <F2> 4,050 130,106
Healthcare Compare Corp. <F2> 2,150 83,313
Healthsource, Inc. <F2> 2,000 96,250
Manor Care, Inc. 4,100 139,400
Occusystems, Inc. <F2> 4,000 83,000
United Healthcare Corp. 3,100 151,513
833,832
Insurance (1.1%)
AFLAC, Inc. 2,400 99,600
American Bankers Insurance Group, Inc. 2,500 93,125
192,725
Leisure (1.8%)
Carnival Corp., Class A 6,400 153,600
Challenger International Ltd. <F2> 11,600 73,950
Ride, Inc. <F2> 4,800 100,800
328,350
Machine Tools (0.8%)
FSI International, Inc. <F2> 4,300 142,975
142,975
Manufacturing (0.5%)
Wabash National Corp. 2,800 99,050
99,050
Medical (5.7%)
ALZA Corp. <F2> 2,600 59,800
Cardinal Health, Inc. 2,300 127,363
Diametrics Med, Inc. <F2> 7,500 85,313
Inhale Therapeutic Systems <F2> 5,000 60,000
North American Vaccine, Inc. <F2> 2,500 27,813
Northfield Laboratories, Inc. <F2> 3,400 $62,900
Pediatrix Medical Group <F2> 3,900 79,950
Research Industries Corp. <F2> 2,600 75,725
Respironics, Inc. <F2> 6,000 115,500
Sofamor/Danek Group, Inc. <F2> 5,000 138,750
Steris Corp. <F2> 2,600 109,525
Ventritex, Inc. <F2> 4,000 86,000
1,028,639
Oil & Gas (0.8%)
Belden & Blake Corp. <F2> 8,000 152,000
152,000
Paper (0.4%)
Chesapeake Corp. 2,000 72,250
72,250
Pharmaceutical (1.8%)
Columbia Labs, Inc. <F2> 11,500 107,813
Immulogic Pharmaceutical Corp. <F2> 4,000 49,000
Merck & Co., Inc. 3,050 170,800
327,613
Real Estate (1.4%)
General Growth Properties, Inc. 4,900 101,063
Post Properties, Inc. 4,600 142,600
Prime Retail, Inc. 700 8,488
252,151
Recycling (0.7%)
Imco Recycling, Inc. 6,000 135,750
135,750
Restaurants (2.4%)
Buffets, Inc. <F2> 5,600 70,000
Cheesecake Factory, Inc. <F2> 8,400 224,700
Daka International, Inc. <F2> 4,200 137,550
432,250
Retail (4.6%)
Autozone, Inc. <F2> 5,200 $132,600
Barnes and Noble, Inc. <F2> 3,000 114,750
Bombay, Inc. <F2> 8,000 65,000
Federated Department Stores, Inc. <F2> 3,950 112,071
Gymboree Corp. <F2> 3,000 90,375
Lechters, Inc. <F2> 2,500 27,500
Mens Wearhouse, Inc. <F2> 2,000 72,000
Movie Gallery, Inc. <F2> 2,000 85,500
Revco D.S., Inc. <F2> 2,850 66,975
Whole Foods Market, Inc. <F2> 5,000 65,625
832,396
Specialized Services (3.8%)
Ambassadors International, Inc. <F2> 8,000 90,000
Cintas Corp. 800 35,200
Devry, Inc. <F2> 4,500 115,875
Equifax, Inc. 2,900 121,438
Gartner Group, Inc, Class A <F2> 2,400 78,600
Lo Jack Corp. <F2> 6,500 107,250
VSI Enterprises, Inc. <F2> 24,000 141,000
689,363
Telecommunications (0.7%)
Cellular Technical Services, Inc. <F2> 1,500 33,938
Mobile Telecommunication Technologies Corp.<F2> 3,000 92,625
126,563
Textiles (2.1%)
Lydall, Inc. <F2> 4,000 99,500
Marisa Christina, Inc. <F2> 5,000 80,000
Quiksilver, Inc. <F2> 3,000 81,375
St. John Knits, Inc. 2,400 117,000
377,875
Total Equity Securities (Cost $13,689,330) 16,092,223
TOTAL INVESTMENTS (88.9%) <F3>
(Cost $13,689,330) <F1> $16,092,223
[FN]
Notes to Portfolio of Investments:
<F1> Cost of investments is substantially the same for federal income tax
purposes.
<F2> These securities have not declared dividends in the past twelve
months.
<F3> The percentages shown represent the percentage of the investments to
net assets.
[/FN]
Calvert Capital Accumulation Fund
Statement of Assets and Liabilities
September 30, 1995
Assets
Investments in securities, at value -
see accompanying portfolio $16,092,223
Cash 2,387,165
Receivable for securities sold 449,065
Receivable for shares sold 143,237
Dividends receivable 4,192
Other assets 22,731
Total assets 19,098,613
Liabilities
Payable for securities purchased 910,751
Payable for shares redeemed 25,296
Payable to Calvert Asset Management Co., Inc. 40,270
Payable to Calvert Distributors, Inc. 5,807
Payable to Calvert Shareholder Services, Inc 2,883
Accrued expenses and other liabilities 10,966
Total liabilities 995,973
Net assets $18,102,640
Net Assets
Net assets consist of:
Paid-in capital applicable to 750,060 outstanding Class A Shares
of common stock, $0.01 par value (250,000,000 shares
authorized for Class A and Class C combined) $13,324,736
Paid-in capital applicable to 92,422 outstanding Class C Shares
of common stock, $0.01 par value (250,000,000 shares
authorized for Class A and Class C combined) 1,811,730
Undistributed net investment income _
Accumulated realized gains (losses) 563,281
Net unrealized appreciation (depreciation) on investments 2,402,893
Net assets $18,102,640
Net Assets Value and Offering Price Per Share
Class A net asset value per share
($16,110,951 divided by 750,060 Class A Shares) $21.48
Maximum sales charge (4.75% of Class A offering price) 1.07
Offering price per Class A Share $22.55
Class C net asset value and offering price per share
($1,991,689 divided by 92,422 Class C Shares) $21.55
See notes to financial statements.
Calvert Capital Accumulation Fund
Statement of Operations
From Inception (October 31, 1994)
Through September 30, 1995
Net Investment Income
Investment Income
Interest income $10,974
Dividend income 22,301
Total investment income 33,275
Expenses
Investment advisory fee 50,418
Transfer agency fees and expenses 13,179
Distribution Plan expenses:
Class A 21,748
Class C 4,448
Directors' fees and expenses 404
Administrative fees 6,251
Custodian fees 19,096
Registration fees 45,806
Reports to shareholders 5,564
Professional fees 7,458
Miscellaneous 508
Reimbursement from Advisor (12,183)
Total expenses 162,697
Fees paid indirectly (19,096)
Net expenses 143,601
Net Investment Income (Loss) (110,326)
Realized and Unrealized Gain (Loss)
on Investments
Net realized gain (loss) 678,368
Change in unrealized appreciation or depreciation 2,402,893
Net Realized and Unrealized Gain
(Loss) on Investments 3,081,261
Increase (Decrease) in Net Assets
Resulting From Operations $ 2,970,935
Calvert Capital Accumulation Fund
Statement of Changes in Net Assets
From Inception
Oct. 31, 1994
Through
September 30,
1995
Increase (Decrease) in Net Assets
Operations
Net investment income (loss) $(110,326)
Net realized gain (loss) on investments 678,368
Change in unrealized appreciation or depreciation
of investments 2,402,893
Increase (Decrease) in Net Assets
Resulting From Operations 2,970,935
Distributions to shareholders from
Net investment income:
Class A Shares (4,761)
Capital share transactions
Class A Shares 13,324,736
Class C Shares 1,811,730
Total capital share transactions 15,136,466
Total Increase (Decrease) in Net Assets 18,102,640
Net Assets
Beginning of period _
End of period . $18,102,640
Notes to Financial Statements
Note A_Significant Accounting Policies
General: The Calvert Capital Accumulation Fund (the "Series"), a series of
Calvert World Values Fund, Inc. (the "Fund"), is registered under the
Investment Company Act of 1940 as a non-diversified, open-end management
investment company. The Fund accounts separately for the operations of each
series. The Series, which commenced operations on October 31, 1994, offers
Class A and Class C shares of capital stock. Class A shares are sold with a
maximum front-end sales charge of 4.75%. Class C shares, which have no
transaction-based sales charge, have a higher annual expense rate than
Class A. Each class has different: (a) Distribution Plan expenses, (b)
class specific expenses, including transfer agency fees, registration fees,
reports to shareholders, (c) dividend rates due to
(a) and (b) above, (d) exchange privileges and (e) class specific voting
rights.
Security Valuation: Securities for which market quotations are readily
available are valued at the most recent closing price of their primary
exchange, or, if closing prices are unavailable, at the bid prices or based
on a yield equivalent obtained from the securities' market maker.
Short-term securities maturing within 60 days are valued at amortized cost
which approximates market. Other securities and assets for which market
quotations are not available or deemed inappropriate are valued in good
faith under the direction of the Board of Directors.
Repurchase Agreements: The Series may enter into repurchase agreements
with recognized financial institutions or registered broker/dealers and, in
all instances, holds underlying securities with a value exceeding the total
repurchase price, including accrued interest.
Security Transactions and Investment Income: Security transactions are
accounted for on trade date. Realized gains and losses are recorded on an
identified cost basis. Dividend income is recorded on the ex-dividend date.
Interest income, accretion of discount and amortization of premium are
recorded on an accrual basis.
Distributions to Shareholders: Distributions to shareholders are recorded
by the Series on ex-dividend date. Dividends from net investment income are
paid annually. Distributions from net realized capital gains, if any, are
paid at least annually. Distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles, accordingly, periodic reclassifications are made within the
Series' capital accounts to reflect income and gains available for-
distribution under income tax regulations.
Expense Offset Arrangement: The Series has an arrangement with its
custodian bank whereby the custodian's fees are paid indirectly by credits
earned on the Series' cash on deposit with the bank. Such deposit
arrangement is an alternative to overnight investments.
Federal Income Taxes: No provision for federal income or excise tax is
required since the Series intends to qualify as a regulated investment
company under the Internal Revenue Code and to distribute substantially all
of its earnings.
Note B_Related Party Transactions
Calvert Asset Management Company, Inc. (the "Advisor") is wholly-owned by
Calvert Group, Ltd. ("Calvert"), which is indirectly wholly-owned by Acacia
Mutual Life Insurance Company. The Advisor provides investment advisory
services and pays the salaries and fees of officers and affiliated
Directors of the Series. For its services, the Advisor receives a monthly
fee based on an annual rate of .80% of the Series' average daily net
assets.
The Advisor reimburses the Series for its operating expenses (excluding
brokerage fees, taxes, interest, Distribution Plan expenses and
extraordinary items) exceeding the following annual rates of average net
assets: 2.5% on the first $30 million, 2.0% on the next $70 million and
1.5% on the excess of $100 million. Additionally, during the year, the
Advisor voluntarily waived fees or assumed expenses of $3,256 which were
not charged to the Series.
Calvert Distributors, Inc. (the successor of Calvert Securities Corp.
effective April, 1995), both affiliates of the Advisor, is the distributor
and principal underwriter for the Series. Distribution Plans, adopted by
each class of shares, allow the Series to pay the distributor for expenses
and services associated with distribution of shares. The expenses paid may
not exceed .35% and 1.0% annually of average daily net assets of each Class
A and Class C, respectively.
The Distributor received $23,647 as its portion of the commissions charged
on sales of the Series' shares.
Calvert Shareholder Services, Inc., an affiliate of the Advisor, acts as
transfer, dividend disbursing and shareholder servicing agent for the
Series.
Calvert Administrative Services Company, an affiliate of the Advisor,
provides administrative services to the Series for an annual fee, payable
monthly, of .10% of the average daily net assets of the Series.
Each Director who is not affiliated with the Advisor receives an annual fee
of $3,000 plus $1,000 for each Board and Committee meeting attended.
Director's fees are allocated to each of the funds served.
Note C_Investment Activity
During the period, purchases and sales of investments, other than
short-term securities, were $19,128,348 and $6,117,386, respectively.
The cost of investments owned at September 30, 1995 was substantially the
same for federal income tax and financial reporting purposes. Net
unrealized appreciation aggregated $2,402,893, of which $2,683,342 related
to appreciated securities and $280,449 related to depreciated securities.
Note D_Capital Share Transactions
The change in net assets resulting from capital share transactions for 1995
is indicated below:
Class A Class C
From Inception From Inception
October 31, 1994 October 31, 1994
Through Through
September 30, September 30,
1995 1995
In dollars:
Shares sold $14,367,141 $1,914,520
Reinvestment of dividends 4,761 _
Shares redeemed (1,047,166) (102,790)
$13,324,736 $1,811,730
In shares:
Shares sold 808,632 97,638
Reinvestment of dividends 304 _
Shares redeemed (58,876) (5,216)
750,060 92,422
Financial Highlights
Class A Shares Class C Shares
From Inception From Inception
Oct. 31, 1994 Oct. 31, 1994
Through Through
September 30, September 30,
1995 1995
Net asset value, beginning of period $15.00 $15.00
Income from investment operations
Net investment income (loss) (.11) (.15)
Net realized and unrealized
gain on investments 6.61 6.70
Total from investment operations 6.50 6.55
Distributions from
Net investment income (.02) _
Net realized gains _ _
Total distributions (.02) _
Total increase (decrease) in
net asset value 6.48 6.55
Net asset value, end of period $21.48 $21.55
Total return<F3> 43.40% 43.67%
Ratios to average net assets:
Net investment income (loss) (1.55%)<F1> (3.13%)<F1>
Total expenses <F2> 2.35% <F1> 3.79% <F1>
Net expenses 2.06% <F1> 3.50% <F1>
Expenses reimbursed
and/or waived .05% <F1> 2.79% <F1>
Portfolio turnover 95% 95%
Net assets, end of period (in thousands) $16,111 $1,992
Number of shares outstanding at
end of period (in thousands) 750 92
[FN]
<F1> Annualized
<F2> This ratio reflects total expenses before reduction for fees paid
indirectly.
<F3> Total return is not annualized and does not reflect deduction of
Class A front-end sales charge.
[/FN]
Investing with Vision (TM) (logo) Calvert Group(R)
A member of the Acacia Group(R)
4550 Montgomery Avenue, Suite 1000N
Bethesda, Maryland 20814
