CALVERT CAPITAL
ACCUMULATION FUND
Dear Shareholder:
This annual report for the Calvert Capital Accumulation Fund covers the
12-month period ended September 30, 1996.
From the fourth quarter of 1995 into the first quarter 1996, the economy
continued to expand at a modest pace. The Federal Reserve continued to maintain
an easy monetary policy and, in late January, took steps to lower short-term
interest rates. In the second quarter of 1996, the economy appeared to gain
momentum, which heightened fears of inflation and increased the likelihood of a
rise in interest rates. This brought about a sharp decline in stock prices.
For the third quarter of 1996, economic growth appeared to moderate.
Reports of retail sales and personal consumption pointed to a benign level of
inflation. And, the most common indexes of price changes, the consumer price
index and producer price index, did not indicate a build up of inflationary
pressures. This served to calm the financial markets in the final months of this
reporting period, and stock prices rebounded.
Stocks closed the 12-month period with strong returns, as measured by the
Standard & Poor's 500 Stock Index, which generated a one-year return of 20%. The
stock market has experienced above-average volatility over the past 12 months,
with prices of small-company stocks demonstrating the greatest fluctuations.
Bond prices see-sawed throughout the period, but long-term bonds, in
general, turned in flat or just slightly negative one-year returns. Money market
rates continued to slide during the final quarter of 1995 and into the first
quarter of 1996, then reversed course and moved higher on expectations of
tighter monetary policy.
Fund Performance
Investors in the Calvert Capital Accumulation Fund enjoyed positive returns
for both the six- and 12-month periods ending September 30. The Fund's
performance lagged that of its benchmark Indices for the 12-month period, due to
our above-average position in the technology sector, which did not have a good
showing in the fourth quarter of 1995. For the six-month period, the Fund's
sizable commitments to some of the better performing sectors, including
technology and financial services, pushed us ahead of the Indices.
Fund Managers' Approach
The Calvert Capital Accumulation Fund utilizes a multi-manager approach to
broaden portfolio diversification and harness the talents of many money
managers. Each of the investment managers below is responsible for directing
roughly one-third of Fund assets. Just after the close of period end, one
management company, Apodaca-Johnston, notified Calvert Group that one of their
primary money managers, Scott Johnston, was resigning. We are evaluating whether
this will necessitate a change in the alloction of Fund assets among investment
managers.
Apodaca-Johnston Capital Management
Apodaca-Johnston looks for companies with small-market capitalizations,
strong balance sheets and the ability to generate well-above-average earnings
and revenue growth. Within that universe, they then select companies in
industries they believe will outperform the broad market.
Late in 1995, the managers restructured the portfolio to match a change in
their industry focus. They eliminated holdings in the semiconductor, chip and
computer equipment arena, where companies were beginning to feel the effects of
an unfavorable shift in supply and demand factors, and built positions in
businesses that are better positioned to meet corporations' and individuals'
growing needs to manage and transmit greater amounts of information. These
include networking, telecommunications and wireless communications and software
companies. Network, Uniphase and DSP Communications, added good gains. Software
companies Aspen Tech, Legato Systems, Mecon and Pegasystems were also strong
performers.
Apodaca-Johnston also took profits in several stocks that had met their
performance expectations, including Adtrend and Teletrend (telecommunications
and wireless).
Brown Capital Management
Brown Capital Management's investment style seeks growth at a reasonable
price. They look to invest in companies that are superior, in terms of
management, earnings-per-share growth prospects and profitability, but not pay
too much more than the market for these exceptional qualities.
For this period, Brown Capital Management's heaviest sector weightings
continued to be technology and financial services. Both areas contributed to the
Fund's return, with Cisco Systems and Oracle turning in outstanding performance
(up 79.9% and 66.4%, respectively). On the negative side, DSC Communications and
United Healthcare, were the weakest performers. Brown sold the Fund's holdings
of both companies, but would consider repurchasing the latter now that some of
the pricing pressures on premiums have abated.
Going forward, Brown will continue to focus on stocks that represent its
key investment themes of productivity enhancement and the aging of America.
Examples of businesses that fit this focus are technology companies with
products and services that enhance efficiency and health care and financial
services companies that are positioned to play a role in meeting aging
Americans' medical and financial needs. Despite the extended bull market,
valuations remain reasonable for the manager's favorite companies.
Fortaleza Asset Management
Fortaleza invests in stocks of small-capitalization companies with
above-average profitability, leadership positions within their industry and
strong management teams. Their investment style is risk-averse, due to the
enforcement of strict buy and sell guidelines.
Technology stocks held back this portion of the portfolio during the last
quarter of 1995, but this sector contributed good gains in the quarters that
followed. Several plays in the health care, specialty retailing and restaurant
sectors also added strong returns. These included CRA Managed Care, CKE
Restaurants and Men's Wearhouse.
Fortaleza expects lingering volatility in the equity markets in the near
term, but they continue to find good opportunities among small-cap growth
stocks. Prices of many of these stocks fell in July, making their valuations
even more attractive. This manager will be seeking strong companies with high
growth potential.
Outlook
Stock market investors have enjoyed one of the longest bull markets in
history. With such good gains being delivered quarter after quarter, it's easy
to forget that the market does not move up in a straight line. While the
long-term outlook for the stock market is positive, there could be considerable
short-term volatility as investors attempt to determine the strength of the
economy and direction of interest rates. We encourage investors to evaluate
their risk exposure and make sure their investments are in-line with their
long-term objectives. We appreciate your investment in the Calvert Capital
Accumulation Fund.
Sincerely,
Clifton S. Sorrell
President
October 17, 1996
Portfolio Statistics
Ten Largest Stock Holdings
as of September 30, 1996
% of Net Assets
- --------------------------------------------------------------------------------
T. Rowe Price Associates, Inc. 1.3%
Green Tree Financial Corp. 1.3%
Vishay Intertechnology, Inc. 1.3%
MCNCorp. 1.3%
Physician Support Systems, Inc. 1.2%
Cisco Systems, Inc. 1.2%
Autozone, Inc. 1.2%
Sterling Software, Inc. 1.2%
Chase Manhattan Corp. 1.2%
Solectron Corp. 1.1%
- ----------------------------------------------------------------------------
Total 12.3%
=========================================================================
Average Annual Total Returns
for periods ended September 30, 1996
Class A Shares
One Year 2.80%
Since Inception (10/31/94) 22.45%
Class C Shares
One Year 6.56%
Since Inception (10/31/94) 24.90%
Performance Comparison
Comparison of changes in value of $10,000 investment.
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 Calvert Capital Accumulation Fund:
We have audited the accompanying statement of net assets of Calvert Capital
Accumulation Fund (one of the portfolios comprising Calvert World Values Fund,
Inc.), as of September 30, 1996, the related statement of operations for the
year then ended, the statement of changes in net assets for the year then ended
and for the period from October 31, 1994 (commencement of operations) through
September 30, 1995 and the financial highlights for the year then ended and 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 audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of investments owned as of
September 30, 1996, by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Calvert Capital Accumulation Fund as of September 30, 1996, and the results of
its operations, the changes in its net assets and financial highlights for the
respective periods referred to above, in conformity with generally accepted
accounting principles.
COOPERS & LYBRAND L.L.P.
Baltimore, Maryland
November 8, 1996
Equity Securities - 94.7% Shares Value
- --------------------------------------------------------------------------------
Agriculture - 0.4%
Northland Cranberries, Inc., Class A 9,200 $156,400
- ----------------------------------------------------------------------------
156,400
Biotechnology - 2.0%
Amgen, Inc. * 5,200 328,250
Ibah, Inc. * 14,000 91,000
Idexx Laboratories, Inc. * 6,000 271,500
Neurex Corp. * 8,200 156,825
- ---------------------------------------------------------------------------
847,575
Business Equipment and Services - 9.0%
Amisys Managed Care Systems, Inc. * 6,800 162,350
Analytical Surveys, Inc. * 14,150 155,650
Cellular Technical Services, Inc. * 9,000 177,750
Cotelligent Group, Inc. * 15,000 236,250
Dataworks Corp. * 7,900 205,400
Equifax, Inc. 17,900 472,112
Leap Group, Inc. * 14,900 150,862
Lightbridge, Inc. * 8,000 94,313
May & Speh, Inc. * 9,000 180,000
Miller Herman, Inc. 7,400 299,700
Physician Computer Network, Inc. * 14,900 158,312
Physician Support Systems, Inc. * 21,900 531,075
Premenos Technology Corp. * 7,400 150,346
Raster Graphics, Inc. * 17,400 156,600
Restrac, Inc. * 14,200 266,250
Staffmark, Inc. * 14,800 209,050
Structural Dynamics Research Corp. (rights) * 10,000 238,750
- --------------------------------------------------------------------------------
3,844,770
- --------------------------------------------------------------------------------
Chemicals - 0.5%
Minerals Technologies, Inc. 5,947 222,269
- ---------------------------------------------------------------------------
222,269
- ------------------------------------------------------------------------------
Communications - 4.7%
Amati Communications Corp. * 5,700 125,400
Cisco Systems, Inc. * 8,200 508,912
Digital Systems International, Inc. * 12,600 225,225
Harmonic Lightwaves, Inc. * 11,400 223,725
Hummingbird Communications, Ltd. * 4,000 115,000
LLC International, Inc. * 5,400 99,431
Periphonics Corp. * 5,100 198,900
Remec, Inc. * 13,700 193,512
Teltrend, Inc. * 2,200 93,500
Videoserver, Inc. * 6,900 239,775
- --------------------------------------------------------------------------------
2,023,380
Computer - Equipment and Services - 0.5%
Encad, Inc. * 5,100 213,562
- -------------------------------------------------------------------------------
213,562
Equity Securities (Cont'd) Shares Value
- ----------------------------------------------------------------------------
Computer - Networks - 3.1%
Act Networks, Inc. * 7,300 $204,400
Bay Networks, Inc. * 13,700 373,325
Cylink Corp. * 12,500 179,688
Netvantage, Inc., Class A * 6,400 93,475
Network General Corp. * 12,000 274,500
Proxim, Inc. * 7,900 227,125
- -------------------------------------------------------------------------------
1,352,513
Computer - Software - 10.0%
Arbor Software Corp. * 3,350 143,212
Aspen Technology, Inc. * 2,500 169,375
Axent Technologies, Inc. * 1,700 39,593
GT Interactive Software Corp. * 10,500 238,875
Hyperion Software Corp. * 20,000 307,500
IDX Systems Corp. * 7,000 245,000
Legato Systems, Inc. * 8,900 422,750
McAfee Associates, Inc. * 3,300 227,700
Microsoft Corp. * 1,450 191,219
Open Text Corp. * 15,000 90,000
Pegasystems, Inc. * 8,100 210,600
Quickturn Design Systems, Inc. * 14,000 190,750
Siebel Systems, Inc. * 5,000 208,125
Sterling Software, Inc. * 6,550 500,554
Systemsoft Corp. * 6,200 212,350
Unify Corp. * 11,900 157,675
Veritas Software Co. * 4,100 290,075
Viasoft, Inc. * 8,600 361,200
Xionics Document Technologies * 7,200 108,000
- ---------------------------------------------------------------------------
4,314,553
Computer - Systems - 5.4%
Applied Microsystems Corp. * 11,000 232,375
Imnet Systems, Inc. * 2,800 54,600
Nuko Information Systems, Inc. * 9,400 173,900
Object Design, Inc. * 14,100 227,362
Oracle Corp. * 10,187 433,772
S3, Inc. * 9,000 177,750
Sync Research, Inc. * 5,900 91,450
Vanstar Corp. * 19,100 463,175
Verifone, Inc. * 7,000 313,250
Versant Object Technology Corp. * 6,400 152,000
- ----------------------------------------------------------------------------
2,319,634
Consumer Products and Services - 1.4%
Carriage Services, Inc., Class A * 9,400 180,950
Newell Co. 14,300 429,245
- --------------------------------------------------------------------------------
610,195
- ------------------------------------------------------------------------------
Dental - 0.3%
United Dental Care, Inc. * 4,000 143,500
- -------------------------------------------------------------------------------
143,500
Equity Securities (Cont'd) Shares Value
- --------------------------------------------------------------------------
Education - 1.0%
Childrens Comprehensive Services, Inc. * 11,300 $200,575
Devry, Inc. * 4,500 204,750
- --------------------------------------------------------------------------------
405,325
Electrical Equipment - 1.3%
Actel Corp. * 10,000 192,500
Checkpoint Systems, Inc. * 8,100 214,650
Ultrak, Inc. * 5,800 159,500
- ---------------------------------------------------------------------------
566,650
Electronics - Defense - 0.2%
Jacobs Engineering Group, Inc. * 3,300 74,250
- ---------------------------------------------------------------------------
74,250
- -----------------------------------------------------------------------------
Electronics - Instruments - 0.7%
Checkfree Corp. * 15,000 300,000
- --------------------------------------------------------------------------------
300,000
Electronics - Semiconductors - 7.1%
Ariel Corp. * 17,900 210,325
Benchmarq Microelectronics, Inc. * 14,200 147,325
CFM Technologies, Inc. * 16,700 194,138
DSP Communications, Inc. * 4,500 251,438
EMC Corp. * 19,500 441,253
Input/Output, Inc. * 4,000 119,000
MRV Communications, Inc. * 8,300 213,725
Solectron Corp. * 9,800 480,200
Transwitch Corp. * 12,400 77,500
Uniphase Corp. * 9,000 380,250
Vishay Intertechnology, Inc. 23,795 550,259
- -----------------------------------------------------------------------------
3,065,413
Financial Services - 4.3%
Chase Manhattan Corp. 6,224 498,698
Glendale Federal Bank Federal Savings Bank * 13,300 236,075
Green Tree Financial Corp. 14,100 553,425
T. Rowe Price Associates, Inc. 17,700 575,250
- --------------------------------------------------------------------------------
1,863,448
- -----------------------------------------------------------------------------
Health Care - 4.4%
American Homepatient, Inc. * 7,500 166,875
American Oncology Research, Inc. * 17,000 191,250
CRA Managed Care, Inc. * 5,500 297,000
GRC International, Inc. * 9,400 159,800
Health Care & Retirement Corp. * 14,750 350,385
NCS Healthcare, Inc., Class A * 6,000 188,250
Pall Corp. (rights) 12,400 350,300
Renal Care Group, Inc. * 5,000 185,000
- -------------------------------------------------------------------------------
1,888,860
Equity Securities (Cont'd) Shares Value
- ------------------------------------------------------------------------------
Insurance - 1.5%
AFLAC, Inc. 11,250 $399,375
American Bankers Insurance Group, Inc. 5,200 260,000
- --------------------------------------------------------------------------------
659,375
Leisure - 1.3%
Anchor Gaming * 2,400 149,400
Carnival Corp., Class A 13,450 416,950
- ---------------------------------------------------------------------------
566,350
Medical - 7.7%
Aksys, Ltd. * 11,000 123,750
ALZA Corp. * 5,200 139,750
Cardinal Health, Inc. 5,500 454,438
Cytyc Corp. * 13,200 198,000
Hologic, Inc. * 5,000 140,000
Inhale Therapeutic Systems * 10,200 131,325
Intelligent Medical Imaging, Inc. * 9,500 135,375
Lunar Corp. * 5,500 176,000
Mecon, Inc. * 18,600 465,000
Medquist, Inc. * 12,000 243,000
Pediatrix Medical Group * 3,900 195,488
QLT Phototherapeutics * 15,100 275,103
Scherer (R.P.) Corp. * 8,800 429,825
Sofamor/Danek Group, Inc. * 7,000 216,125
- --------------------------------------------------------------------------------
3,323,179
Office Equipment and Supplies - 0.6%
Corporate Express, Inc. * 7,000 272,125
- ----------------------------------------------------------------------------
272,125
- -----------------------------------------------------------------------------
Oil & Gas - 3.2%
Belden & Blake Corp. * 11,000 255,750
Dawson Production Services, Inc. * 12,200 155,550
MCN Corp. 20,200 542,875
Varco International, Inc. * 17,000 299,625
Veritas DGC, Inc. * 5,600 100,800
- -----------------------------------------------------------------------------
1,354,600
Pharmaceutical - 3.1%
Agouron Pharmaceuticals, Inc. * 5,800 253,025
Columbia Labs, Inc. * 15,300 187,425
Immulogic Pharmaceutical Corp. * 20,000 162,500
Incyte Pharmaceuticals, Inc. * 4,600 227,700
Medicis Pharmaceutical Corp., Class A * 3,250 156,812
Nexstar Pharmaceuticals, Inc. * 6,100 128,100
Sequus Pharmaceuticals, Inc. * 13,800 217,350
- --------------------------------------------------------------------------------
1,332,912
- --------------------------------------------------------------------------------
Property Management - 0.8%
Rouse Co. 12,300 319,800
- -----------------------------------------------------------------------------
319,800
Equity Securities (Cont'd) Shares Value
- --------------------------------------------------------------------------------
Real Estate - 1.5%
General Growth Properties, Inc. 11,450 $284,819
Post Properties, Inc. 10,000 366,250
- --------------------------------------------------------------------------------
651,069
Restaurants - 3.9%
Applebees International, Inc. 7,000 185,500
Buffets, Inc. * 3,400 35,700
Cheesecake Factory, Inc. * 16,100 366,275
CKE Restaurants, Inc. 8,600 264,450
Mortons Restaurant Group, Inc. * 11,000 192,500
Papa Johns International, Inc. * 5,000 262,500
Rainforest Cafe, Inc. * 11,650 361,150
- ----------------------------------------------------------------------------
1,668,075
Retail - Apparel - 4.9%
AnnTaylor Stores Corp. * 7,500 126,562
Buckle, Inc. * 7,000 222,250
Cutter & Buck, Inc. * 12,500 165,625
Gadzooks, Inc. * 12,200 423,950
Gymboree Corp. * 6,500 197,438
Noodle Kidoodle, Inc. * 15,000 112,500
Pacific Sunwear of California * 12,000 394,500
St. John Knits, Inc. 3,500 175,438
Wet Seal, Inc., Class A * 8,500 306,000
- --------------------------------------------------------------------------
2,124,263
- --------------------------------------------------------------------------------
Retail - Department Stores - 0.5%
Nordstrom, Inc. 6,100 231,800
- -------------------------------------------------------------------------------
231,800
Retail - Discount Stores - 1.2%
Dollar General Corp. 13,650 424,857
Tuesday Morning Corp. * 4,800 88,200
- -----------------------------------------------------------------------------
513,057
Retail - Special Line - 4.8%
Autozone, Inc. * 17,300 501,920
Eagle Hardware & Garden, Inc. * 7,800 210,600
Gargoyles, Inc. * 100 2,125
Home Depot, Inc. 5,600 318,500
Hot Topic, Inc. * 500 11,750
Just For Feet, Inc. * 6,000 300,750
Revco D.S., Inc. * 10,350 304,031
Rexall Sundown, Inc. * 6,200 226,300
West Marine, Inc. * 6,000 198,000
- ----------------------------------------------------------------------------
2,073,976
Specialized Services - 0.5%
Veterinary Centers America, Inc. * 9,300 204,019
- -----------------------------------------------------------------------------
204,019
- -------------------------------------------------------------------------------
Equity Securities (Cont'd) Shares Value
- --------------------------------------------------------------------
Telecommunications - 2.9%
Advanced Fibre Communications * 200 $5,000
Brightpoint, Inc. * 10,000 241,250
EIS International, Inc. * 11,000 154,000
Microcom, Inc. * 5,000 42,500
Orckit Communications Ltd. * 7,700 141,034
P Com, Inc. * 7,200 178,200
TCSI Corp. * 10,000 132,500
Westell Technologies, Class A * 7,500 331,875
- ---------------------------------------------------------------------------
1,226,359
Total Equity Securities (Cost $33,766,875) 40,733,256
- ----------------------------------------------------------------------------
Principal
Repurchase Agreements - 7.2% Amount
- --------------------------------------------------------------------------------
Donaldson, Lufkin, Jenrette: 5.70%, dated 9/30/96, due 10/1/96
(Collateral: $3,275,897, FNMA, 8.00%, 4/13/05) $3,100,000 3,100,000
- --------------------------------------------------------------------------------
Total Repurchase Agreements (Cost $3,100,000) 3,100,000
TOTAL INVESTMENTS (Cost $36,866,875) - 101.9% 43,833,256
Other assets and liabilities, net - (1.9%) (835,188)
- --------------------------------------------------------------------------------
Net Assets - 100% $42,998,068
================================================================================
Net Assets Consist of:
- ----------------------------------------------------------------------------
Paid-in capital applicable to the following shares of common stock,
250,000,000 shares of $0.01 par value authorized for Class A
and Class C combined:
Class A: 1,766,853 shares outstanding $34,001,962
Class C: 141,637 shares outstanding 2,801,583
Accumulated net realized gain (loss) on investments (771,858)
Net unrealized appreciation (depreciation) on investments 6,966,381
- -----------------------------------------------------------------------------
Net assets $42,998,068
==========================================================================
Net Asset Value per Share
- -------------------------------------------------------------------------------
Class A (based on net assets of $39,833,981) $22.55
================================================================================
Class C (based on net assets of $3,164,087) $22.34
Net Investment Income
- -------------------------------------------------------------------------------
Investment Income
Interest income $33,542
Dividend income 94,791
- -------------------------------------------------------------------------------
Total investment income 128,333
Expenses
Investment advisory fee 243,241
Transfer agency fees and expenses 134,497
Distribution Plan expenses:
Class A 96,724
Class C 27,695
Directors' fees and expenses 2,366
Administrative fees 30,405
Custodian fees 53,679
Registration fees 47,117
Reports to shareholders 32,864
Professional fees 5,338
Miscellaneous 16,798
- --------------------------------------------------------------------------------
Total expenses 690,724
Fees paid indirectly (53,679)
- --------------------------------------------------------------------------------
Net expenses 637,045
- -----------------------------------------------------------------------------
Net Investment Income (Loss) (508,712)
- -------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss)
on Investments
- ----------------------------------------------------------------------------
Net realized gain (loss) (770,972)
Change in unrealized appreciation or depreciation 4,563,488
- --------------------------------------------------------------------------------
Net Realized and Unrealized Gain
(Loss) on Investments 3,792,516
- -----------------------------------------------------------------------
Increase (Decrease) in Net Assets
Resulting From Operations $3,283,804
================================================================================
Increase (Decrease) in Net Assets
- ------------------------------------------------------------
Operations
Net investment income (loss) $(508,712) $(110,326)
Net realized gain (loss) (770,972) 678,368
Change in unrealized appreciation or depreciation 4,563,488 2,402,893
- --------------------------------------------------------------------------------
Increase (Decrease) in Net Assets
Resulting From Operations 3,283,804 2,970,935
- -----------------------------------------------------------------------------
Distributions to shareholders from
Net investment income:
Class A Shares - (4,761)
Net realized gain:
Class A Shares (495,825) --
Class C Shares (67,810) --
- -------------------------------------------------------------------------------
Total distributions ` (563,635) (4,761)
- ------------------------------------------------------------------------------
Capital share transactions:
Shares sold:
Class A Shares 30,827,635 14,367,141
Class C Shares 2,840,269 1,914,520
Reinvestment of distributions:
Class A Shares 477,674 4,761
Class C Shares 66,109 --
Shares redeemed:
Class A Shares (10,158,587) (1,047,166)
Class C Shares (1,877,841) (102,790)
- ------------------------------------------------------------------------------
Total capital share transactions 22,175,259 15,136,466
- --------------------------------------------------------------------------------
Total Increase (Decrease) in Net Assets 24,895,428 18,102,640
Net Assets
- ------------------------------------------------------------------------
Beginning of period 18,102,640 --
- ---------------------------------------------------------------------------
End of period $42,998,068 $18,102,640
==============================================================================
Capital Share Activity
Shares sold:
Class A Shares 1,470,804 808,632
Class C Shares 137,319 97,638
Reinvestment of distributions:
Class A Shares 23,450 304
Class C Shares 3,242 --
Shares redeemed:
Class A Shares (477,461) (58,876)
Class C Shares (91,346) (5,216)
- --------------------------------------------------------------------------
Total capital share activity 1,066,008 842,482
==============================================================================
Note A-Significant Accounting Policies
General: The Calvert Capital Accumulation Fund (the "Fund"), a series of
Calvert World Values Fund, Inc., is registered under the Investment Company Act
of 1940 as a non-diversified, open-end management investment company. The
operations of each series are accounted for separately. The Fund, 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) dividend
rates, due to differences in Distribution Plan expenses and other class specific
expenses, (b) exchange privileges and (c) class specific voting rights.
Security Valuation: Securities listed or traded on a national securities
exchange are valued at the last reported sale price. Unlisted securities and
listed securities for which the last sale price is unavailable are valued at the
most recent bid price or based on a yield equivalent obtained from the
securities' market maker. 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 Fund 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 Fund on ex-dividend date. Dividends from net investment income and
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 Fund' capital accounts to
reflect income and gains available for distribution under income tax
regulations.
Expense Offset Arrangement: The Fund has an arrangement with its custodian
bank whereby the custodian's fees are paid indirectly by credits earned on the
Fund's 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 Fund 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 Fund.
For its services, the Advisor receives a monthly fee based on an annual rate of
.80% of the Fund's average daily net assets.
The Advisor reimburses the Fund 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.
Calvert Administrative Services Company, an affiliate of the Advisor,
provides administrative services to the Fund for an annual fee, payable monthly,
of .10% of the average daily net assets of the Fund.
Calvert Distributors, Inc., an affiliate of the Advisor, is the distributor
and principal underwriter for the Fund. Distribution Plans, adopted by each
class of shares, allow the Fund 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 $151,785 as its portion of the commissions charged
on sales of the Fund's shares.
Calvert Shareholder Services, Inc., an affiliate of the Advisor, acts as
transfer, dividend disbursing and shareholder servicing agent for the Fund.
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 year, purchases and sales of investments, other than short-term
securities, were $52,695,090 and $31,846,574, respectively.
The cost of investments owned at September 30, 1996 was substantially the
same for federal income tax and financial reporting purposes. Net unrealized
appreciation aggregated $6,966,381, of which $8,155,320 related to appreciated
securities and $1,188,939 related to depreciated securities.
Net realized capital loss carryforwards, for federal income tax purposes,
of approximately $87,000 at year end may be utilized to offset current and
future capital gains until expiration in 2004.
Class A Shares
- -----------------------------------------------------------------------------
Net asset value, beginning $21.48 $15.00
================================================================================
Income from investment operations
Net investment income (loss) (.24) (.11)
Net realized and unrealized gain (loss) 1.88 6.61
- --------------------------------------------------------------------------------
Total from investment operations 1.64 6.50
Distributions from
Net investment income - (.02)
Net realized gain (.57) -
- -------------------------------------------------------------------------
Total distributions (.57) (.02)
Total increase (decrease) in net asset value 1.07 6.48
Net asset value, ending $22.55 $21.48
================================================================================
Total return* 7.92% 43.40%
==============================================================================
Ratios to average net assets:
Net investment income (loss) (1.56%) (1.55%)(a)
Total expenses 2.16% 2.35%(a)
================================================================================
Net expenses 1.98% 2.06%(a)
================================================================================
Expenses reimbursed - .05%(a)
Portfolio turnover 114% 95%
Average commission (rate paid) $.06 -
Net assets, ending (in thousands) $39,834 $16,111
Number of shares outstanding, ending (in thousands) 1,767 750
Class C Shares
- --------------------------------------------------------------------------------
Net asset value, beginning $21.55 $15.00
================================================================================
Income from investment operations
Net investment income (loss) (.55) (.15)
Net realized and unrealized gain (loss) 1.91 6.70
- --------------------------------------------------------------------------------
Total from investment operations 1.36 6.55
Distributions from
Net investment income - -
Net realized gain (.57) -
- --------------------------------------------------------------------------------
Total distributions (.57) -
- --------------------------------------------------------------------------------
Total increase (decrease) in net asset value .79 6.55
Net asset value, ending $22.34 $21.55
============================================================================
Total return* 6.56% 43.67%
================================================================================
Ratios to average net assets:
Net investment income (loss) (2.82%) (3.13%)(a)
Total expenses 3.42% 3.79%(a)
Net expenses 3.24% 3.50%(a)
Expenses reimbursed - 2.79%(a)
Portfolio turnover 114% 95%
Average commission (rate paid) $.06 -
Net assets, ending (in thousands) $3,164 $1,992
Number of shares outstanding, ending (in thousands) 142 92
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
TDDfor 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
Web Site
................................................................................
Address: http://www.calvertgroup.com
Principal
Underwriter:
................................................................................
Calvert Distributors, Inc.
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
