ALLIANCE PREMIER GROWTH FUND INC, 497, 1995-06-16

ALLIANCE PREMIER GROWTH FUND INC
497, 1995-06-16

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<PAGE>

This is filed pursuant to Rule 497(c).
File Nos. 33-49530 and 811-06730.

00250217.BB1

<PAGE>

Alliance Capital [Logo] The Alliance Stock Funds
____________________________________________________________
June 1, 1995

Supplement to Prospectus dated February 1, 1995

This supplement sets forth unaudited per share income
and capital change information for the periods indicated for
Alliance All-Asia Investment Fund, Inc. ("All-Asia Fund"),
pursuant to the requirements of the Securities and Exchange
Commission applicable to registered investment companies in
their first year of operations and for Alliance
International Fund ("International Fund"), Alliance
Worldwide Privatization Fund, Inc. ("Worldwide Privatization
Fund"), Alliance New Europe Fund, Inc. ("New Europe Fund"),
Alliance Global Small Cap Fund, Inc. ("Global Small Cap
Fund"), Alliance Strategic Balanced Fund ("Strategic
Balanced Fund") and Alliance Balanced Shares, Inc.
("Balanced Shares") (collectively, the "Funds"). Unaudited
financial statements and related notes as of the same dates
for the respective Funds have also been added to the
Statement of Additional Information for each Fund.

The following information supplements the information
under the heading "Financial Information" on pages 7 through
15 of the Prospectus.

<PAGE>

Net Realized
and Net Increase
Net Asset Unrealized (Decrease) Dividends Distributions
Value Net Gain in Net Asset from Net from Net
Beginning Investment (Loss) on Value from Investment Realized
Fiscal Period of Period Income (Loss) Investments Operations Income Gains
_____________ _________ _____________ ___________ ____________ ___________ _____________

International Fund

Class A
Six months
ended 12/31/94.... $18.38 $(.05) $(.26) $(.31) $0.00 $(1.62)
Class B
Six months
ended 12/31/94.... $17.90 $(.06)(b) $(.31) $(.37) $0.00 $(1.62)
Class C
Six months
ended 12/31/94.... $17.91 $(.03) $(.34) $(.37) $0.00 $(1.62)

Worldwide
Privatization Fund

Class A
Six months
ended 12/31/94.... $9.75 $(.01) $.24 $.23 $0.00 $0.00
Class B
Six months
ended 12/31/94.... $9.74 $(.03) $.23 $.20 $0.00 $0.00

New Europe Fund

Class A
Six months
ended 1/31/95..... $12.66 $(.07) $.23 $.16 $(.09) $0.00
Class B
Six months
ended 1/31/95..... $12.41 $(.11) $.22 $.11 $(.09) $0.00
Class C
Six months

<PAGE>

ended 1/31/95..... $12.42 $(.12) $.23 $.11 $(.09) $0.00

All Asia Fund

Class A
11/28/94**
- 4/30/95......... $10.00 $.11(c) $.13 $.24 $0.00 $0.00
Class B
11/18/94**
- 4/30/95......... $10.00 $.09(c) $.13 $.22 $0.00 $0.00
Class C
11/28/94**
- 4/30/95......... $10.00 $.08(c) $.16 $.24 $0.00 $0.00

</TABLE>

<PAGE>

Total Net Assets Ratio of Net
Total Net Asset Investment At End of Ratio Of Investment
Dividends Value Return Based Period Expenses Income (Loss)
And End of On Net Asset (000's) To Average To Average Portfolio
Distributions Period Value (a) omitted) Net Assets Net Assets Turnover Rate
_____________ _________ _____________ ____________ ____________ ___________ _____________

$(1.62) $16.45 (1.57)% $176,845 1.77%* (.46)%* 57%

$(1.62) $15.91 (1.94)% $49,532 2.56%* (1.32)%* 57%

$(1.62) $15.92 (1.94)% $29,173 2.56%* (1.29)%* 57%

$0.00 $9.98 2.36% $14,226 2.30%* (.04)%* 16%

$0.00 $9.94 2.05% $81,181 2.99%* (.75)%* 16%

$(.09) $12.73 1.29% $76,095 2.04%* (.89)%* 39%

$(.09) $12.43 .91% $29,978 2.74%* (1.59)%* 39%

$(.09) $12.44 .91% $8,863 2.73%* (1.59)%* 39%

<PAGE>

$0.00 $10.24 2.40% $1,917 .19%*(d) 3.44%* 51%

$0.00 $10.22 2.20% $3,019 .90%*(d) 2.73%* 51%

$0.00 $10.24 2.40% $185 .71%*(d) 2.87%* 51%

</TABLE>

<PAGE>

Net Realized
and Net Increase
Net Asset Unrealized (Decrease) Dividends Distributions
Value Net Gain in Net Asset from Net from Net
Beginning Investment (Loss) on Value from Investment Realized
Fiscal Period of Period Income (Loss) Investments Operations Income Gains
_____________ _________ ____________ ____________ ____________ ___________ _____________
<S> <C> <C> <C> <C> <C> <C>

Global Small
Cap Fund

Class A
Six months
ended 1/31/95..... $11.08 $(.04)(b) $(.23) $(.27) $(2.11) $0.00
Class B
Six months
ended 1/31/95..... $10.78 $(.02) $(.28) $(.30) $(2.11) $0.00
Class C
Six months
ended 1/31/95..... $10.79 $(.09) $(.22) $(.31) $(2.11) $0.00

Strategic
Balanced Fund

Class A
Six months
ended 1/31/95..... $16.26 $.18(c) $(.47) $(.29) $(.22) $(.04)
Class B
Six months
ended 1/31/95..... $14.10 $.11(c) $(.40) $(.29) $(.12) $(.04)
Class C
Six months
ended 1/31/95..... $14.11 $.10(c) $(.39) $(.29) $(.12) $(.04)

Balanced Shares

Class A
Six months
ended 1/31/95..... $13.38 $.23 $(.23) $0.00 $(.20) $(.02)
Class B
Six months
ended 1/31/95..... $13.23 $.16 $(.21) $(.05) $(.16) $(.02)
Class C
Six months

<PAGE>

ended 1/31/95..... $13.24 $.16 $(.21) $(.05) $(.16) $(.02)

</TABLE>

<PAGE>

$(2.11) $8.70 (2.26)% $53,830 2.52%* (1.24)%* 65%

$(2.11) $8.37 (2.61)% $4,574 3.24%* (2.00)%* 65%

$(2.11) $8.37 (2.73)% $1,131 3.21%* (1.96)%* 65%

$(.26) $15.71 (1.79)% $9,102 1.40%*(d) 2.14%* 34%

$(.16) $13.65 (2.07)% $39,008 2.10%*(d) 1.44%* 34%

$(.16) $13.66 (2.07)% $4,119 2.10%*(d) 1.45%* 34%

$(.22) $13.16 .09% $146,840 1.26%* 3.36%* 61%

$(.18) $13.00 (.32)% $13,350 2.04%* 2.58%* 61%

$(.18) $13.01 (.32)% $4,690 2.03%* 2.56%* 61%

___________________________________________

<PAGE>

* Annualized
** Commencement of operations
(a) Total investment return is calculated assuming an initial investment made at the net asset value at
the beginning of the period, reinvestment of all dividends and distributions at the net asset value
during the period, and a redemption on the last day of the period. Initial sales charge or
contingent deferred sales charge is not reflected in the calculation of total investment return.
Total investment returns calculated for periods of less than one year are not annualized.
(b) Based on average shares outstanding.
(c) Net of fee waived and expenses reimbursed by Alliance
(d) Net of expenses waived/reimbursed. If All-Asia Fund had borne all expenses, the expense ratios
would have been, with respect to Class A shares 11.71% (annualized), with respect to Class B shares
12.35% (annualized) and with respect to Class C shares 11.80% (annualized). If Strategic Balanced
Fund had borne all expenses, the expense ratios would have been, with respect to Class A shares
1.59% (annualized) and with respect to Class B and Class C shares 2.29% (annualized).
</TABLE>

Additionally, as of May 1, 1995, the portfolio manager of
Strategic Balanced Fund is Bruce W. Calvert. Mr. Calvert is a
Vice Chairman and the Chief Investment Officer of Alliance
Capital Management Corporation, the sole general partner of
Alliance Capital Management L.P., with which he has been
associated since prior to 1990.

9
00250157.BA7

<PAGE>

The Alliance
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Stock Funds
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P.O. Box 1520, Secaucus, New Jersey 07096-1520
Toll Free (800) 221-5672
For Literature: Toll Free (800) 227-4618

Prospectus and Application

February 1, 1995

Domestic Stock Funds Global Stock Funds
- -The Alliance Fund -Alliance International Fund
- -Alliance Growth Fund -Alliance Worldwide Privatization Fund
- -Alliance Premier Growth Fund -Alliance New Europe Fund
- -Alliance Counterpoint Fund -Alliance All-Asia Investment Fund
- -Alliance Technology Fund -Alliance Global Small Cap Fund
- -Alliance Quasar Fund

Total Return Funds
-Alliance Strategic Balanced Fund
-Alliance Balanced Shares
-Alliance Income Builder Fund
-Alliance Utility Income Fund
-Alliance Growth and Income Fund

Table of Contents Page
The Funds at a Glance................................................. 2
Expense Information................................................... 4
Financial Highlights.................................................. 7
Glossary.............................................................. 16
Description of the Funds.............................................. 17
Investment Objectives and Policies................................ 17
Additional Investment Practices................................... 26
Certain Fundamental Investment Policies........................... 33
Risk Considerations............................................... 36
Purchase and Sale of Shares........................................... 39
Management of the Funds............................................... 42
Dividends, Distributions and Taxes.................................... 44
General Information................................................... 46

Adviser
Alliance Capital Management L.P.
1345 Avenue Of The Americas
New York, New York 10105

The Alliance Stock Funds provide a broad selection of investment alternatives to
investors seeking capital growth or high total return. The Domestic Stock Funds
invest mainly in the United States equity markets, and the Global Stock Funds
diversify their investments among equity markets around the world, while the
Total Return Funds invest in both equity and fixed-income securities.

Each fund or portfolio (each a "Fund") is, or is a series of, an open-end
management investment company. This Prospectus sets forth concisely the
information which a prospective investor should know about each Fund before
investing. A "Statement of Additional Information" for each Fund which provides
further information regarding certain matters discussed in this Prospectus and
other matters which may be of interest to some investors has been filed with the
Securities and Exchange Commission and is incorporated herein by reference. For
a free copy, call or write Alliance Fund Services, Inc. at the indicated address
or "Literature" telephone number.

Each Fund offers three classes of shares which may be purchased at the
investor's choice at a price equal to their net asset value (i) plus an initial
sales charge imposed at the time of purchase (the "Class A shares"), (ii) with a
contingent deferred sales charge imposed on most redemptions made within four
years of purchase (the "Class B shares"), or (iii) without any initial or
contingent deferred sales charge (the "Class C shares"). See "Purchase and Sale
of Shares."

An investment in these securities is not a deposit or obligation of, or
guaranteed or endorsed by, any bank and is not federally insured by the Federal
Deposit Insurance Corporation, the Federal Reserve Board or any other agency.

Investors are advised to read this Prospectus carefully and to retain it for
future reference.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

Alliance(R)
Mutual funds without the Mystery/TM/

(R)/SM These are registered marks used under licenses from the owner, Alliance
Capital Management L.P.
<PAGE>

The Funds At A Glance

The following summary is qualified in its entirety by the more detailed
information contained in this Prospectus.

The Funds' Investment Manager Is . . .

Alliance Capital Management L.P. ("Alliance"), a global investment manager
providing diversified services to institutions and individuals through a
broad line of investments including 102 mutual funds. Since 1971, Alliance
has earned a reputation as a leader in the investment world with over $123
billion in assets under management. Alliance provides investment management
services to 28 of the FORTUNE 100 companies.

Domestic Stock Funds

Alliance Fund

Seeks . . . Long-term growth of capital and income primarily through
investment in common stocks.

Invests Principally in . . . A diversified portfolio of equity securities that,
in the judgment of Alliance, have the potential to achieve capital appreciation.

Growth Fund

Seeks . . . Long-term growth of capital by investing primarily in common
stocks and other equity securities.

Invests Principally in . . . A diversified portfolio of equity securities of
companies with a favorable outlook for earnings and whose rate of growth is
expected to exceed that of the United States economy over time.

Premier Growth Fund

Seeks . . . Long-term growth of capital by investing in the equity securities
of a limited number of large, carefully selected, high-quality American
companies of a relatively small number of intensively researched companies.

Invests Principally in . . . A non-diversified portfolio of equity securities
that, in the judgment of Alliance, are likely to achieve superior earnings
growth. Normally, approximately 40 companies will be represented in the
Fund's investment portfolio. The Fund's investments in 25 of these companies
most highly regarded at any point in time by Alliance will usually constitute
approximately 70% of the Fund's net assets.

Counterpoint Fund

Seeks . . . Long-term capital growth, primarily, and current income,
secondarily.

Invests Principally in . . . A diversified portfolio of price-depressed,
undervalued or out-of-favor equity securities.

Technology Fund

Seeks . . . Growth of capital through investment in companies expected to
benefit from advances in technology.

Invests Principally in . . . A diversified portfolio of securities of
companies which use technology extensively in the development of new or
improved products or processes.

Quasar Fund

Seeks . . . Growth of capital by pursuing aggressive investment policies.

Invests Principally in . . . A diversified portfolio of equity securities of any
company and industry and in any type of security which is believed to offer
possibilities for capital appreciation.

Global Stock Funds

International Fund

Seeks . . . A total return on its assets from long-term growth of capital and
from income.

Invests Principally in . . . A diversified portfolio of marketable securities
of established non-United States companies, companies participating in
foreign economies with prospects for growth, and foreign government securities.

Worldwide Privatization Fund

Seeks . . . Long-term capital appreciation.

Invests Principally in . . . A non-diversified portfolio of equity securities
issued by enterprises that are undergoing, or have undergone, privatization.
The balance of the Fund's investment portfolio will include securities of
companies that are believed by Alliance to be beneficiaries of the
privatization process.

New Europe Fund

Seeks . . . Long-term capital appreciation through investment primarily in
the equity securities of companies based in Europe.

Invests Principally in . . . A non-diversified portfolio of equity securities
of European companies.

All-Asia Fund

Seeks . . . Long-term capital appreciation.

Invests Principally in . . . A non-diversified portfolio of equity securities
of Asian companies.

Global Small Cap Fund

Seeks . . . Long-term growth of capital.

Invests Principally in . . . A diversified global portfolio of the equity
securities of small capitalization companies.

2
<PAGE>

Total Return Funds

Strategic Balanced Fund

Seeks . . . A high long-term total return by investing in a combination of
equity and debt securities.

Invests Principally in . . . A diversified portfolio of dividend-paying
common stocks and fixed-income securities, and also in equity-type securities
such as warrants, preferred stocks and convertible debt instruments.

Balanced Shares

Seeks . . . A high return through a combination of current income and capital
appreciation.

Invests Principally in . . . A diversified portfolio of equity and fixed-income
securities such as common and preferred stocks, U.S. Government and agency
obligations, bonds and senior debt securities.

Income Builder Fund

Seeks . . . Both an attractive level of current income and long-term growth
of income and capital.

Invests Principally in . . . A non-diversified portfolio of fixed-income
securities and dividend-paying common stocks. Alliance currently expects to
continue to maintain approximately 60% of the Fund's net assets in
fixed-income securities and 40% in equity securities.

Utility Income Fund

Seeks . . . Current income and capital appreciation through investment in the
utilities industry.

Invests Principally in . . . A diversified portfolio of equity securities,
such as common stocks, securities convertible into common stocks and rights
and warrants to subscribe for purchase of common stocks, and in fixed-income
securities such as bonds and preferred stocks.

Growth and Income Fund

Seeks . . . Income and appreciation through investment in dividend-paying
common stocks of quality companies.

Invests Principally in . . . A diversified portfolio of dividend-paying
common stocks of good quality, and, under certain market conditions, other
types of securities, including bonds, convertible bonds and preferred stocks.

A Word About Risk . . .

The price of the shares of the Alliance Stock Funds will fluctuate as the daily
prices of the individual securities in which they invest fluctuate, so that your
shares, when redeemed, may be worth more or less than their original cost. With
respect to those Funds permitted to invest in foreign currency denominated
securities, these fluctuations may be magnified by changes in foreign exchange
rates. Investment in the Global Stock Funds involves risks not associated with
funds that invest primarily in securities of U.S. issuers. While the Funds
invest principally in common stocks and other equity securities, in order to
achieve their investment objectives the Funds may at times use certain types of
investment derivatives, such as options, futures, forwards and swaps. These
involve risks different from, and, in certain cases, greater than, the risks
presented by more traditional investments. These risks are fully discussed in
this Prospectus.

Getting Started . . .

Shares of the Funds are available through your financial representative and
most banks, insurance companies and brokerage firms nationwide. Shares can be
purchased for a minimum initial investment of $250, and subsequent
investments can be made for as little as $50. For detailed information about
purchasing and selling shares, see "Purchase and Sale of Shares." In
addition, the Funds offer several time and money saving services to
investors. Be sure to ask your financial representative about:

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Automatic Reinvestment
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Automatic Investment Program
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Retirement Plans
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Shareholder Communications
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Dividend Direction Plans
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Auto Exchange
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Systematic Withdrawals
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A Choice of Purchase Plans
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Telephone Transactions
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24 Hour Information
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Alliance(R)
Mutual funds without the Mystery/TM/

(R)/SM These are registered marks used under licenses from the owner,
Alliance Capital Management L.P.

3
<PAGE>

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Expense Information
- --------------------------------------------------------------------------------

Shareholder Transaction Expenses are one of several factors to consider when
you invest in a Fund. The following table summarizes your maximum transaction
costs from investing in a Fund and annual expenses for each class of shares
of each Fund. For each Fund, the "Examples" to the right of the table below
show the cumulative expenses attributable to a hypothetical $1,000 investment
in each class for the periods specified.

Class A Shares Class B Shares Class C Shares
-------------- -------------- --------------
<S> <C> <C> <C>
Maximum sales charge imposed on purchases (as a percentage of
offering price)........................................................ 4.25%(a) None None
Sales charge imposed on dividend reinvestments......................... None None None
Deferred sales charge (as a
percentage of original purchase
price or redemption proceeds,
whichever is lower).................................................... None(a) 4.0% None
during the
first year,
decreasing 1.0%
annually to 0%
after the
fourth year (b)
Exchange fee........................................................... None None None
</TABLE>

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(a) Reduced for larger purchases. Purchases of $1,000,000 or more are not
subject to an initial sales charge but may be subject to a 1% deferred sales
charge on redemptions within one year of purchase. See "Purchase and Sale of
Shares--How to Buy Shares" -pages 39 and 40.

(b) Class B shares of each Fund other than Premier Growth Fund automatically
convert to Class A shares after eight years and the Class B shares of
Premier Growth Fund convert to Class A shares after six years. See "Purchase
and Sale of Shares--How to Buy Shares" -pages 39 and 40.

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Please refer to the footnotes on page 6.

4
<PAGE>

<TABLE>
<CAPTION>
Operating Expenses Examples
- ------------------------------------------------------------------ ------------------------------------------------------------
Technology Fund Class A Class B Class C Class A Class B+ Class B++ Class C
------- ------- ------- ------- -------- --------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Management fees 1.00% 1.00% 1.00% After 1 year $ 59 $ 65 $ 25 $ 24
12b-1 fees .30% 1.00% 1.00% After 3 years $ 93 $ 96 $ 76 $ 75
Other expenses (a) .36% .43% .41% After 5 years $129 $130 $130 $129
---- ---- ----
Total fund After 10 years $231 $258(b) $258(b) $275
operating expenses 1.66% 2.43% 2.41%
==== ==== ====
<CAPTION>
Quasar Fund Class A Class B Class C Class A Class B+ Class B++ Class C
------- ------- ------- ------- -------- --------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Management fees 1.00% 1.00% 1.00% After 1 year $ 59 $ 65 $ 25 $ 25
12b-1 fees .21% 1.00% 1.00% After 3 years $ 93 $ 98 $ 78 $ 77
Other expenses (a) .46% .50% .48% After 5 years $129 $133 $133 $132
---- ---- ----
Total fund After 10 years $232 $263(b) $263(b) $282
operating expenses 1.67% 2.50% 2.48%
==== ==== ====
<CAPTION>
International Fund Class A Class B Class C Class A Class B+ Class B++ Class C
------- ------- ------- ------- -------- --------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Management fees 1.00% 1.00% 1.00% After 1 year $ 61 $ 68 $ 28 $ 28
12b-1 fees .18% 1.00% 1.00% After 3 years $100 $106 $ 86 $ 86
Other expenses (a) .72% .78% .78% After 5 years $141 $147 $147 $147
---- ---- ----
Total fund After 10 years $255 $290(b) $290(b) $311
operating expenses 1.90% 2.78% 2.78%
==== ==== ====
<CAPTION>
Worldwide Privatization Fund Class A Class B Class C Class A Class B+ Class B++ Class C
------- ------- ------- ------- -------- --------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Management fees 1.00% 1.00% 1.00% After 1 year $ 69 $ 75 $ 35 $ 35
12b-1 fees .30% 1.00% 1.00% After 3 years $124 $126 $106 $106
Other expenses (a) 1.45% 1.45% 1.45% After 5 years $182 $179 $179 $179
---- ---- ----
Total fund After 10 years $337 $357(b) $357(b) $373
operating expenses 2.75% 3.45% 3.45%
==== ==== ====
<CAPTION>
New Europe Fund Class A Class B Class C Class A Class B+ Class B++ Class C
------- ------- ------- ------- -------- --------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Management fees 1.07% 1.07% 1.07% After 1 year $ 63 $ 68 $ 28 $ 28
12b-1 fees .30% 1.00% 1.00% After 3 years $104 $106 $ 86 $ 86
Other expenses (a) .69% .69% .69% After 5 years $149 $146 $146 $146
---- ---- ----
Total fund After 10 years $271 $292(b) $292(b) $309
operating expenses 2.06% 2.76% 2.76%
==== ==== ====
<CAPTION>
All-Asia Fund Class A Class B Class C Class A Class B+ Class B++ Class C
------- ------- ------- ------- -------- --------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Management fees 1.00% 1.00% 1.00% After 1 year $ 64 $ 69 $ 29 $ 29
12b-1 fees .30% 1.00% 1.00% After 3 years $108 $109 $ 89 $ 89
Other expenses After 5 years $154 $152 $152 $152
Administration fees (f) .15% .15% .15% After 10 years $283 $304(b) $304(b) $320
Other operating expenses (a) .73% .73% .73%
---- ---- ----
Total other expenses .88% .88% .88%
---- ---- ----
Total fund
operating expenses 2.18% 2.88% 2.88%
==== ==== ====
<CAPTION>
Global Small Cap Fund Class A Class B Class C Class A Class B+ Class B++ Class C
------- ------- ------- ------- -------- --------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Management fees 1.00% 1.00% 1.00% After 1 year $ 66 $ 72 $ 32 $ 32
12b-1 fees .30% 1.00% 1.00% After 3 years $115 $117 $ 97 $ 97
Other expenses (a) 1.12% 1.15% 1.13% After 5 years $166 $165 $165 $164
---- ---- ----
Total fund After 10 years $306 $329(b) $329(b) $344
operating expenses 2.42% 3.15% 3.13%
==== ==== ====
<CAPTION>
Strategic Balanced Fund Class A Class B Class C Class A Class B+ Class B++ Class C
------- ------- ------- ------- -------- --------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Management fees
(after waiver) (c) .45% .45% .45% After 1 year $ 56 $ 61 $ 21 $ 21
12b-1 fees .30% 1.00% 1.00% After 3 years $ 85 $ 86 $ 66 $ 66
Other expenses (a) After 5 years $116 $113 $113 $113
(after reimbursement) (d) .65% .65% .65% After 10 years $203 $225(b) $225(b) $243
---- ---- ----
Total fund
operating expenses (d) 1.40% 2.10% 2.10%
==== ==== ====
</TABLE>

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Please refer to the footnotes on page 6.

5
<PAGE>

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+ Assumes redemption at end of period.

++ Assumes no redemption at end of period.

(a) These expenses include a transfer agency fee payable to Alliance Fund
Services, Inc., an affiliate of Alliance, based on a fixed dollar amount
charged to the Fund for each shareholder's account.

(b) Assumes Class B shares converted to Class A shares after eight years, or
six years with respect to Premier Growth Fund.

(c) Net of voluntary fee waiver. In the absence of such waiver, management
fees would be .75% for Strategic Balanced Fund.

(d) Net of voluntary fee waiver and expense reimbursement. In the absence of
such waiver and reimbursement, annualized other expenses for Strategic
Balanced Fund would have been 1.19%, 1.19% and 1.19%, respectively, for
Class A, Class B and Class C shares, and annualized total fund operating
expenses for Strategic Balanced Fund would have been 1.94%, 2.64% and 2.64%,
respectively, for Class A, Class B and Class C shares.

(e) Net of expense reimbursements. Absent expense reimbursements, total fund
operating expenses for Utility Income Fund would be 27.21%, 14.42% and
14.42%, respectively, for Class A, Class B and Class C shares.

(f) Reflects the fees payable by All-Asia Fund to Alliance pursuant to an
administration agreement.

The purpose of the foregoing table is to assist the investor in understanding
the various costs and expenses that an investor in a Fund will bear directly or
indirectly. Long-term shareholders of a Fund may pay aggregate sales charges
totaling more than the economic equivalent of the maximum initial sales charges
permitted by the Rules of Fair Practice of the National Association of
Securities Dealers, Inc. See "Management of the Funds--Distribution Services
Agreements." The Rule 12b-1 fee for each class comprises a service fee not
exceeding .25% of the aggregate average daily net assets of the Fund
attributable to the class and an asset-based sales charge equal to the remaining
portion of the Rule 12b-1 fee. The information shown in the table for Alliance
Fund, Growth Fund, Technology Fund, New Europe Fund, Global Small Cap Fund,
Strategic Balanced Fund, Balanced Shares and Income Builder Fund reflects
annualized expenses based on the Funds' most recent fiscal periods. "Total Fund
Operating Expenses" for Utility Income Fund are based on estimated amounts for
the Funds' current fiscal year. See "Management of the Funds." "Other Expenses"
for Class A, Class B and Class C shares of All-Asia Fund and Class C shares of
Worldwide Privatization Fund are based on estimated amounts for each Fund's
current fiscal year. The management fee rates of Growth Fund, Premier Growth
Fund, Counterpoint Fund, Strategic Balanced Fund, Technology Fund, International
Fund, Worldwide Privatization Fund, New Europe Fund, All-Asia Fund, Income
Builder Fund and Utility Income Fund are higher than those paid by most other
investment companies, but Alliance believes the fees are comparable to those
paid by investment companies of similar investment orientation. The expense
ratios for Class B and Class C shares of Counterpoint Fund, Technology Fund and
Quasar Fund, and for each Class of shares of Global Small Cap Fund and Worldwide
Privatization Fund, are higher than the expense ratios of most other mutual
funds, but are comparable to the expense ratios of mutual funds whose shares are
similarly priced. The examples set forth above assume reinvestment of all
dividends and distributions and utilize a 5% annual rate of return as mandated
by Commission regulations. The examples should not be considered representative
of past or future expenses; actual expenses may be greater or less than those
shown.

6
<PAGE>

- --------------------------------------------------------------------------------
Financial Highlights
- --------------------------------------------------------------------------------

The tables on the following pages present, for each Fund, per share income and
capital changes for a share outstanding throughout each period indicated. The
information in the tables for Alliance Fund, Growth Fund, Premier Growth Fund,
Strategic Balanced Fund, Balanced Shares, Utility Income Fund, Worldwide
Privatization Fund and Growth and Income Fund has, except as noted otherwise,
been audited by Price Waterhouse LLP, the independent accountants for each Fund,
and for Counterpoint Fund, Technology Fund, Quasar Fund, International Fund, New
Europe Fund, Global Small Cap Fund and Income Builder Fund by Ernst & Young LLP,
the independent auditors for each Fund. A report of Price Waterhouse LLP or
Ernst & Young LLP, as the case may be, on the information with respect to each
Fund appears in the Fund's Statement of Additional Information. The following
information for each Fund should be read in conjunction with the financial
statements and related notes which are included in the Fund's Statement of
Additional Information. Per share data and ratios are not presented for Class C
shares of Worldwide Privatization Fund since no such shares were outstanding
during the period presented below for that Fund. No information is presented for
All-Asia Fund since it commenced operations on November 23, 1994.

Further information about a Fund's performance is contained in the Fund's annual
report to shareholders, which may be obtained without charge by contacting
Alliance Fund Services, Inc. at the address or the "Literature" telephone number
shown on the cover of this Prospectus.

7
<PAGE>

<TABLE>
<CAPTION>
Net Asset Net Realized Net Increase
Value and Unrealized (Decrease) In Dividends From Distributions
Beginning Of Net Investment Gain (Loss) On Net Asset Value Net Investment From Net
Fiscal Year or Period Period Income (Loss) Investments From Operations Income Realized Gains
- --------------------- ------------ -------------- -------------- --------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Alliance Fund
Class A
1/1/94 to 11/30/94**... $ 6.85 $ .01 $ (.23) $ (.22) $0.00 $ 0.00
Year ended 12/31/93.... 6.68 .02 .93 .95 (.02) (.76)
Year ended 12/31/92.... 6.29 .05 .87 .92 (.05) (.48)
Year ended 12/31/91.... 5.22 .07 1.70 1.77 (.07) (.63)
Year ended 12/31/90.... 6.87 .09 (.32) (.23) (.18) (1.24)
Year ended 12/31/89.... 5.60 .12 1.19 1.31 (.04) 0.00
Year ended 12/31/88.... 5.15 .08 .80 .88 (.08) (.35)
Year ended 12/31/87.... 6.87 .08 .27 .35 (.13) (1.94)
Year ended 12/31/86.... 11.15 .11 .87 .98 (.10) (5.16)
Year ended 12/31/85.... 9.18 .20 2.51 2.71 (.23) (.51)
Year ended 12/31/84.... 11.48 .24 (.84) (.60) (.24) (1.46)
Class B
1/1/94 to 11/30/94**... $ 6.76 $ (.03) $ (.23) $ (.26) $0.00 $ 0.00
Year ended 12/31/93.... 6.64 (.03) .91 .88 0.00 (.76)
Year ended 12/31/92.... 6.27 (.01)(b) .87 .86 (.01) (.48)
3/4/91++ to 12/31/91... 6.14 .01 (b) .79 .80 (.04) (.63)
Class C
1/1/94 to 11/30/94**... $ 6.77 $ (.03) $ (.24) $ (.27) $0.00 $ 0.00
5/3/93++ to 12/31/93... 6.67 (.02) .88 .86 0.00 (.76)

Growth Fund (i)
Class A
5/1/94 to 10/31/94**... $ 23.89 $ .09 $ 1.10 $ 1.19 $0.00 $ 0.00
Year ended 4/30/94..... 22.67 (.01)(c) 3.55 3.54 0.00 (2.32)
Year ended 4/30/93..... 20.31 .05 (c) 3.68 3.73 (.14) (1.23)
Year ended 4/30/92..... 17.94 .29 (c) 3.95 4.24 (.26) (1.61)
9/4/90++ to 4/30/91.... 13.61 .17 (c) 4.22 4.39 (.06) 0.00
Class B
5/1/94 to 10/31/94**... $ 20.27 $ .01 $ .93 $ .94 $0.00 $ 0.00
Year ended 4/30/94..... 19.68 (.07)(c) 2.98 2.91 0.00 (2.32)
Year ended 4/30/93..... 18.16 (.06)(c) 3.23 3.17 (.03) (1.62)
Year ended 4/30/92..... 16.88 .17 (c) 3.67 3.84 (.21) (2.35)
Year ended 4/30/91..... 14.38 .08 (c) 3.22 3.30 (.09) (.71)
Year ended 4/30/90..... 14.13 .01 (b)(c) 1.26 1.27 0.00 (1.02)
Year ended 4/30/89..... 12.76 (.01)(c) 2.44 2.43 0.00 (1.06)
10/23/87+ to 4/30/88... 10.00 (.02)(c) 2.78 2.76 0.00 0.00
Class C
5/1/94 to 10/31/94**... $ 20.28 $ .01 $ .93 $ .94 $0.00 $ 0.00
8/2/93++ to 4/30/94.... 21.47 (.02)(c) 1.15 1.13 0.00 (2.32)

Premier Growth Fund
Class A
Year ended 11/30/94.... $ 11.78 $ (.09) $ (.28) $ (.37) $0.00 $ 0.00
Year ended 11/30/93.... 10.79 (.05) 1.05 1.00 (.01) 0.00
9/28/92+ to 11/30/92... 10.00 .01 .78 .79 0.00 0.00
Class B
Year ended 11/30/94.... $ 11.72 $ (.15) $ (.28) $ (.43) $0.00 $ 0.00
Year ended 11/30/93.... 10.79 (.10) 1.03 .93 0.00 0.00
9/28/92+ to 11/30/92... 10.00 0.00 .79 .79 0.00 0.00
Class C
Year ended 11/30/94.... $ 11.72 $ (.09) $ (.33) $ (.42) $0.00 $ 0.00
5/3/93++ to 11/30/93... 10.48 (.05) 1.29 1.24 0.00 0.00

Counterpoint Fund
Class A
Year ended 9/30/94..... $ 20.89 $ (.10) $ (.82) $ (.92) $0.00 $(2.83)
Year ended 9/30/93..... 19.45 (.01) 2.60 2.59 (.04) (1.11)
Year ended 9/30/92..... 19.08 .13 1.76 1.89 (.16) (1.36)
Year ended 9/30/91..... 15.18 .17 4.92 5.09 (.20) (.99)
Year ended 9/30/90..... 19.86 .23 (3.63) (3.40) (.20) (1.08)
Year ended 9/30/89..... 15.02 .21 5.30 5.51 (.23) (.44)
Year ended 9/30/88..... 18.05 .27 (2.09) (1.82) (.26) (.95)
Year ended 9/30/87..... 14.26 .26 4.20 4.46 (.36) (.31)
Year ended 9/30/86..... 10.98 .37 3.31 3.68 (.35) (.09)
2/28/85+ to 9/30/85.... 10.00 .13 .85 .98 0.00 0.00
Class B
Year ended 9/30/94..... $ 20.82 $ (.08) $ (.97) $(1.05) $0.00 $(2.83)
5/3/93++ to 9/30/93.... 18.51 (.07) 2.38 2.31 0.00 0.00
Class C
Year ended 9/30/94..... $ 20.83 $ (.14) $ (.91) $(1.05) $0.00 $(2.83)
5/3/93++ to 9/30/93...... 18.51 (.05) 2.37 2.32 0.00 0.00
</TABLE>
- -------------------------------------------------------------------------------
Please refer to the footnotes on pages 14 and 15.

8
<PAGE>

Growth Fund (i)
Class A
5/1/94 to 10/31/94**... $ 0.00 $25.08 4.98% $167,800 1.35%* .86%* 24%
Year ended 4/30/94..... (2.32) 23.89 15.66 102,406 1.40 (f) .32 87
Year ended 4/30/93..... (1.37) 22.67 18.89 13,889 1.40 (f) .20 124
Year ended 4/30/92..... (1.87) 20.31 23.61 8,228 1.40 (f) 1.44 137
9/4/90++ to 4/30/91.... (.06) 17.94 32.40 713 1.40*(f) 1.99* 130
Class B
5/1/94 to 10/31/94**... $ 0.00 $21.21 4.64% $751,521 2.05%* .16%* 24%
Year ended 4/30/94..... (2.32) 20.27 14.79 394,227 2.10 (f) (.36) 87
Year ended 4/30/93..... (1.65) 19.68 18.16 56,704 2.15 (f) (.53) 124
Year ended 4/30/92..... (2.56) 18.16 22.75 37,845 2.15 (f) .78 137
Year ended 4/30/91..... (.80) 16.88 24.72 22,710 2.10 (f) .56 130
Year ended 4/30/90..... (1.02) 14.38 8.81 15,800 2.00 (f) .07 165
Year ended 4/30/89..... (1.06) 14.13 20.31 7,672 2.00 (f) (.03) 139
10/23/87+ to 4/30/88... 0.00 12.76 27.60 1,938 2.00*(f) (.40)* 52
Class C
5/1/94 to 10/31/94**... $ 0.00 $21.22 4.64% $114,455 2.05%* .16%* 24%
8/2/93++ to 4/30/94.... (2.32) 20.28 5.27 64,030 2.10*(f) (.31)* 87

Premier Growth Fund
Class A
Year ended 11/30/94.... $ 0.00 $11.41 (3.14)% $ 35,146 1.96% (.67)% 98%
Year ended 11/30/93.... (.01) 11.78 9.26 40,415 2.18 (.61) 68
9/28/92+ to 11/30/92... 0.00 10.79 7.90 4,893 2.17*(f) .91*(f) 0
Class B
Year ended 11/30/94.... $0.00 $11.29 (3.67)% $139,988 2.47% (1.19)% 98%
Year ended 11/30/93.... 0.00 11.72 8.64 151,600 2.70 (1.14) 68
9/28/92+ to 11/30/92... 0.00 10.79 7.90 19,941 2.68*(f) .35*(f) 0
Class C
Year ended 11/30/94.... $0.00 $11.30 (3.58)% $ 7,332 2.47% (1.16)% 98%
5/3/93++ to 11/30/93... 0.00 11.72 11.83 3,899 2.79* (1.35)* 68

Counterpoint Fund
Class A
Year ended 9/30/94..... $(2.83) $17.14 (4.91)% $ 42,712 1.94% (.43)% 25%
Year ended 9/30/93..... (1.15) 20.89 13.76 67,356 1.79 (.04) 48
Year ended 9/30/92..... (1.52) 19.45 10.76 70,876 1.62 .79 39
Year ended 9/30/91..... (1.19) 19.08 35.39 59,690 1.64 1.02 38
Year ended 9/30/90..... (1.28) 15.18 (17.91) 49,198 1.72 1.38 57
Year ended 9/30/89..... (.67) 19.86 38.25 60,478 1.69 1.28 37
Year ended 9/30/88..... (1.21) 15.02 (8.94) 44,789 1.76 1.93 33
Year ended 9/30/87..... (.67) 18.05 32.24 57,752 1.64 (f) 1.68(f) 24
Year ended 9/30/86..... (.40) 14.26 34.00 36,713 1.55 (f) 2.88(f) 17
2/28/85+ to 9/30/85.... 0.00 10.98 9.80 22,365 1.50*(f) 3.20*(f) 6
Class B
Year ended 9/30/94..... $(2.83) $16.94 (5.63)% $ 527 2.73% (1.17)% 25%
5/3/93++ to 9/30/93.... 0.00 20.82 12.48 120 3.35* (1.60)* 48
Class C
Year ended 9/30/94..... $(2.83) $16.95 (5.62)% $ 418 2.66% (1.11)% 25%
5/3/93++ to 9/30/93.... 0.00 20.83 12.53 242 3.22* (1.34)* 48
</TABLE>
- -------------------------------------------------------------------------------

9
<PAGE>

<TABLE>
<CAPTION>
Net Net
Net Asset Realized and Increase
Value Unrealized (Decrease) In Dividends From Distributions
Beginning Of Net Investment Gain (Loss) On Net Asset Value Net Investment From Net
Fiscal Year or Period Period Income (Loss) Investments From Operations Income Realized Gains
- --------------------- ------------ -------------- -------------- --------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Technology Fund
Class A
1/1/94 to 11/30/94**...... $26.12 $(.32) $ 6.18 $ 5.86 $0.00 $ 0.00
Year ended 12/31/93....... 28.20 (.29) 6.39 6.10 0.00 (8.18)
Year ended 12/31/92....... 26.38 (.22) (b) 4.31 4.09 0.00 (2.27)
Year ended 12/31/91....... 19.44 (.02) 10.57 10.55 0.00 (3.61)
Year ended 12/31/90....... 21.57 (.03) (.56) (.59) 0.00 (1.54)
Year ended 12/31/89....... 20.35 0.00 1.22 1.22 0.00 0.00
Year ended 12/31/88....... 20.22 (.03) .16 .13 0.00 0.00
Year ended 12/31/87....... 23.11 (.10) 4.54 4.44 0.00 (7.33)
Year ended 12/31/86....... 20.64 (.14) 2.62 2.48 (.01) 0.00
Year ended 12/31/85....... 16.52 .02 4.30 4.32 (.20) 0.00
Year ended 12/31/84....... 21.44 .20 (3.72) (3.52) (.01) (1.39)
Class B
1/1/94 to 11/30/94**...... $25.98 $(.23) $ 5.86 $ 5.63 $0.00 $ 0.00
5/3/93++ to 12/31/93...... 27.44 (.12) 6.84 6.72 0.00 (8.18)
Class C
1/1/94 to 11/30/94**...... $25.98 $(.24) $ 5.87 $ 5.63 $0.00 $ 0.00
5/3/93++ to 12/31/93...... 27.44 (.13) 6.85 6.72 0.00 (8.18)
Quasar Fund
Class A
Year ended 9/30/94........ $24.43 $(.60) $ (.36) $ (.96) $0.00 $ (.82)
Year ended 9/30/93........ 19.34 (.41) 6.38 5.97 0.00 (.88)
Year ended 9/30/92........ 21.27 (.24) (1.53) (1.77) 0.00 (.16)
Year ended 9/30/91........ 15.67 (.05) 5.71 5.66 (.06) 0.00
Year ended 9/30/90........ 24.84 .03 (b) (7.18) (7.15) 0.00 (2.02)
Year ended 9/30/89........ 17.60 .02 (b) 7.40 7.42 0.00 (.18)
Year ended 9/30/88........ 24.47 (.08) (2.08) (2.16) 0.00 (4.71)
Year ended 9/30/87(d)..... 21.80 (.14) 5.88 5.74 0.00 (3.07)
Year ended 9/30/86(d)..... 17.25 0.00 5.54 5.54 (.03) (.96)
Year ended 9/30/85(d)..... 14.67 .04 2.87 2.91 (.11) (.22)
Year ended 9/30/84(d)..... 20.73 .12 (2.24) (2.12) (.05) (3.89)
Class B
Year ended 9/30/94........ $23.88 $(.53) $ (.61) $(1.14) $0.00 $ (.82)
Year ended 9/30/93........ 19.07 (.18) 5.87 5.69 0.00 (.88)
Year ended 9/30/92........ 21.14 (.39) (1.52) (1.91) 0.00 (.16)
Year ended 9/30/91........ 15.66 (.13) 5.67 5.54 (.06) 0.00
9/17/90++ to 9/30/90...... 17.17 (.01) (1.50) (1.51) 0.00 0.00
Class C
Year ended 9/30/94........ $23.88 $(.36) $ (.78) $(1.14) $0.00 $ (.82)
5/3/93++ to 9/30/93....... 20.33 (.10) 3.65 3.55 0.00 0.00
International Fund
Class A
Year ended 6/30/94........ $16.01 $(.09) $ 3.02 $ 2.93 $0.00 $ (.56)
Year ended 6/30/93........ 14.98 (.01) 1.17 1.16 (.04) (.09)
Year ended 6/30/92........ 14.00 .01 (b) 1.04 1.05 (.07) 0.00
Year ended 6/30/91........ 17.99 .05 (3.54) (3.49) (.03) (.47)
Year ended 6/30/90........ 17.24 .03 2.87 2.90 (.04) (2.11)
Year ended 6/30/89........ 16.09 .05 3.73 3.78 (.13) (2.50)
Year ended 6/30/88........ 23.70 .17 (1.22) (1.05) (.21) (6.35)
Year ended 6/30/87........ 22.02 .15 4.31 4.46 (.03) (2.75)
Year ended 6/30/86........ 11.94 .02 10.50 10.52 (.03) (.41)
Year ended 6/30/85........ 10.77 .06 (c) 1.79 1.85 (.10) (.58)
Class B
Year ended 6/30/94........ $15.74 $(.19) (b) $ 2.91 $ 2.72 $0.00 $ (.56)
Year ended 6/30/93........ 14.81 (.12) 1.14 1.02 0.00 (.09)
Year ended 6/30/92........ 13.93 (.11) (b) 1.02 .91 (.03) 0.00
9/17/90++ to 6/30/91...... 15.52 .03 (1.12) (1.09) (.03) (.47)
Class C
Year ended 6/30/94........ $15.74 $(.11) $ 2.84 $ 2.73 $0.00 $ (.56)
4/30/93++ to 6/30/93...... 15.93 0.00 (.19) (.19) 0.00 0.00
Worldwide Privatization Fund
Class A
6/2/94+ to 6/30/94........ $10.00 $ .01 $ (.26) $ (.25) $0.00 $ 0.00
Class B
6/2/94+ to 6/30/94........ $10.00 $ .00 $ (.26) $ (.26) $0.00 $ 0.00
</TABLE>
- --------------------------------------------------------------------------------
Please refer to the footnotes on pages 14 and 15.

10
<PAGE>

<TABLE>
<CAPTION>
Total Net Assets Ratio of
Total Net Asset Investment At End Of Ratio Of Net Investment
Dividends Value Return Based Period Expenses Income (Loss)
And End of on Net Asset (000's To Average To Average Portfolio
Fiscal Year or Period Distributions Period Value (a) omitted) Net Assets Net Assets Turnover Rate
- --------------------- ------------- ------------- ------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Technology Fund
Class A
1/1/94 to 11/30/94**...... $ 0.00 $31.98 22.44% $202,929 1.66%* (1.22)%* 55%
Year ended 12/31/93....... (8.18) 26.12 21.63 173,732 1.73 (1.32) 64
Year ended 12/31/92....... (2.27) 28.20 15.50 173,566 1.61 (.90) 73
Year ended 12/31/91....... (3.61) 26.38 54.24 191,693 1.71 (.20) 134
Year ended 12/31/90....... (1.54) 19.44 (3.08) 131,843 1.77 (.18) 147
Year ended 12/31/89....... 0.00 21.57 6.00 141,730 1.66 .02 139
Year ended 12/31/88....... 0.00 20.35 0.64 169,856 1.42(f) (.16)(f) 139
Year ended 12/31/87....... (7.33) 20.22 19.16 167,608 1.31(f) (.56)(f) 248
Year ended 12/31/86....... (.01) 23.11 12.03 147,733 1.13(f) (.57)(f) 141
Year ended 12/31/85....... (.20) 20.64 26.24 147,114 1.14(f) .07(f) 259
Year ended 12/31/84....... (1.40) 16.52 (16.44) 140,227 1.13(f) 1.13(f) 242
Class B
1/1/94 to 11/30/94**...... $ 0.00 $31.61 21.67% $ 18,397 2.43%* (1.95)%* 55%
5/3/93++ to 12/31/93...... (8.18) 25.98 24.49 1,645 2.57* (2.30)* 64
Class C
1/1/94 to 11/30/94**...... $ 0.00 $31.61 21.67% $ 7,470 2.41%* (1.94)%* 55%
5/3/93++ to 12/31/93...... (8.18) 25.98 24.49 1,096 2.52* (2.25)* 64
Quasar Fund
Class A
Year ended 9/30/94........ $ (.82) $22.65 (4.05)% $155,470 1.67% (1.15)% 110%
Year ended 9/30/93........ (.88) 24.43 31.58 228,874 1.65 (1.00) 102
Year ended 9/30/92........ (.16) 19.34 (8.34) 252,140 1.62 (.89) 128
Year ended 9/30/91........ (.06) 21.27 36.28 333,806 1.64 (.22) 118
Year ended 9/30/90........ (2.02) 15.67 (30.81) 251,102 1.66 .16 90
Year ended 9/30/89........ (.18) 24.84 42.68 263,099 1.73 .10 90
Year ended 9/30/88........ (4.71) 17.60 (8.61) 90,713 1.28(f) (.40)(f) 58
Year ended 9/30/87(d)..... (3.07) 24.47 29.61 134,676 1.18(f) (.56)(f) 76
Year ended 9/30/86(d)..... (.99) 21.80 33.79 144,959 1.18(f) .02 (f) 84
Year ended 9/30/85(d)..... (.33) 17.25 20.29 77,067 1.18 .22 77
Year ended 9/30/84(d)..... (3.94) 14.67 (12.55) 48,654 1.18 .83 47
Class B
Year ended 9/30/94........ $ (.82) $21.92 (4.92)% $ 13,901 2.50% (1.98)% 110%
Year ended 9/30/93........ (.88) 23.88 30.53 16,779 2.46 (1.81) 102
Year ended 9/30/92........ (.16) 19.07 (9.05) 9,454 2.42 (1.67) 128
Year ended 9/30/91........ (.06) 21.14 35.54 7,346 2.41 (1.28) 118
9/17/90++ to 9/30/90...... 0.00 15.66 (8.79) 71 2.09* (.26)* 90
Class C
Year ended 9/30/94........ $ (.82) $21.92 (4.92)% $ 1,220 2.48% (1.96)% 110%
5/3/93++ to 9/30/93....... 0.00 23.88 17.46 118 2.49* (1.90)* 102
International Fund
Class A
Year ended 6/30/94........ $ (.56) $18.38 18.68% $201,916 1.90% (.50)% 97%
Year ended 6/30/93........ (.13) 16.01 7.86 161,048 1.88 (.14) 94
Year ended 6/30/92........ (.07) 14.98 7.52 179,807 1.82 .07 72
Year ended 6/30/91........ (.50) 14.00 (19.34) 214,442 1.73 .37 71
Year ended 6/30/90........ (2.15) 17.99 16.98 265,999 1.45 .33 37
Year ended 6/30/89........ (2.63) 17.24 27.65 166,003 1.41 .39 87
Year ended 6/30/88........ (6.56) 16.09 (4.20) 132,319 1.41 .84 55
Year ended 6/30/87........ (2.78) 23.70 23.05 194,716 1.30 .77 58
Year ended 6/30/86........ (.44) 22.02 90.87 139,326 1.29 .16 62
Year ended 6/30/85........ (.68) 11.94 18.28 71,707 1.35(c) .73(c) 40
Class B
Year ended 6/30/94........ $ (.56) $17.90 17.65% $ 29,943 2.78% (1.15)% 97%
Year ended 6/30/93........ (.09) 15.74 6.98 6,363 2.70 (.96) 94
Year ended 6/30/92........ (.03) 14.81 6.54 5,585 2.68 (.70) 72
9/17/90++ to 6/30/91...... (.50) 13.93 (6.97) 3,515 3.39* .84* 71
Class C
Year ended 6/30/94........ $ (.56) $17.91 17.72% $ 13,503 2.78% (1.12)% 97%
4/30/93++ to 6/30/93...... 0.00 15.74 (1.19) 229 2.57* .08* 94
Worldwide Privatization Fund
Class A
6/2/94+ to 6/30/94........
Class B $ 0.00 $ 9.75 (2.50)% $ 4,990 2.75%* 1.03%* 0%
6/2/94+ to 6/30/94........ $ 0.00 $ 9.74 (2.60)% $ 22,859 3.45%* .33%* 0%
</TABLE>
- --------------------------------------------------------------------------------

11
<PAGE>

<TABLE>
<CAPTION>
Net Net
Net Asset Realized and Increase
Value Unrealized (Decrease) In Dividends From Distributions
Beginning Of Net Investment Gain (Loss) On Net Asset Value Net Investment From Net
Fiscal Year or Period Period Income (Loss) Investments From Operations Income Realized Gains
- --------------------- ------------ -------------- -------------- --------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
New Europe Fund
Class A
Period ended 7/31/94**.... $12.53 $ .09 $ .04 $ .13 $0.00 $ 0.00
Year ended 2/28/94........ 9.37 .02 (b) 3.14 3.16 0.00 0.00
Year ended 2/28/93........ 9.81 .04 (.33) (.29) (.15) 0.00
Year ended 2/29/92........ 9.76 .02 (b) .05 .07 (.02) 0.00
4/2/90+ to 2/28/91........ 11.11 (e) .26 (.91) (.65) (.26) (.44)
Class B
Period ended 7/31/94**.... $12.32 $ .07 $ .02 $ .09 $0.00 $ 0.00
Year ended 2/28/94........ 9.28 (.05) (b) 3.09 3.04 0.00 0.00
Year ended 2/28/93........ 9.74 (.02) (.33) (.35) (.11) 0.00
3/5/91++ to 2/29/92....... 9.84 (.04) (b) (.04) (.08) (.02) 0.00
Class C
Period ended 7/31/94**.... $12.33 $ .06 $ .03 $ .09 $0.00 $ 0.00
5/3/93++ to 2/28/94....... 10.21 (.04) (b) 2.16 2.12 0.00 0.00
Global Small Cap Fund
Class A
Period ended 7/31/94**.... $11.24 $(.15) $ (.01) $ (.16) $0.00 $ 0.00
Year ended 9/30/93........ 9.33 (.15) 2.49 2.34 0.00 (.43)
Year ended 9/30/92........ 10.55 (.16) (1.03) (1.19) 0.00 (.03)
Year ended 9/30/91........ 8.26 (.06) 2.35 2.29 0.00 0.00
Year ended 9/30/90........ 15.54 (.05) (b) (4.12) (4.17) 0.00 (3.11)
Year ended 9/30/89........ 11.41 (.03) 4.25 4.22 0.00 (.09)
Year ended 9/30/88........ 15.07 (.05) (1.83) (1.88) 0.00 (1.78)
Year ended 9/30/87........ 15.47 (.07) 4.19 4.12 (.04) (4.48)
Year ended 9/30/86........ 12.94 .05 3.74 3.79 (.04) (1.22)
Year ended 9/30/85........ 13.75 .07 .25 .32 (.12) (1.01)
Class B
Period ended 7/31/94**.... $11.00 $(.17)(b) $ (.05) $ (.22) $0.00 $ 0.00
Year ended 9/30/93........ 9.20 (.15) 2.38 2.23 0.00 (.43)
Year ended 9/30/92........ 10.49 (.20) (1.06) (1.26) 0.00 (.03)
Year ended 9/30/91........ 8.26 (.07) 2.30 2.23 0.00 0.00
9/17/90++ to 9/30/90...... 9.12 (.01) (.85) (.86) 0.00 0.00
Class C
Period ended 7/31/94**.... $11.00 $(.17)(b) $ (.04) $ (.21) $0.00 $ 0.00
5/3/93++ to 9/30/93....... 9.86 (.05) 1.19 1.14 0.00 0.00
Strategic Balanced Fund (i)
Class A
Period ended 7/31/94**.... $16.46 $ .07 (c) $ (.27) $ (.20) $0.00 $ 0.00
Year ended 4/30/94........ 16.97 .16 (c) .74 .90 (.24) (1.17)
Year ended 4/30/93........ 17.06 .39 (c) .59 .98 (.42) (.65)
Year ended 4/30/92........ 14.48 .27 (c) 2.80 3.07 (.17) (.32)
9/4/90++ to 4/30/91....... 12.51 .34 (c) 1.66 2.00 (.03) 0.00
Class B
Period ended 7/31/94**.... $14.30 $ .03 (c) $ (.23) $ (.20) $0.00 $ 0.00
Year ended 4/30/94........ 14.92 .06 (c) .63 .69 (.14) (1.17)
Year ended 4/30/93........ 15.51 .23 (c) .53 .76 (.25) (1.10)
Year ended 4/30/92........ 13.96 .22 (c) 2.70 2.92 (.29) (1.08)
Year ended 4/30/91........ 12.40 .43 (c) 1.60 2.03 (.47) 0.00
Year ended 4/30/90........ 11.97 .50 (b)(c) .60 1.10 (.25) (.42)
Year ended 4/30/89........ 11.45 .48 (c) 1.11 1.59 (.30) (.77)
10/23/87+ to 4/30/88...... 10.00 .13 (c) 1.38 1.51 (.06) 0.00
Class C
Period ended 7/31/94**.... $14.31 $ .03 (c) $ (.23) $ (.20) $0.00 $ 0.00
8/2/93++ to 4/30/94....... 15.64 .15 (c) (.17) (.02) (.14) (1.17)
Balanced Shares
Class A
Period ended 7/31/94**.... $14.40 $ .29 $ (.74) $ (.45) $(.28) $ (.29)
Year ended 9/30/93........ 13.20 .34 1.29 1.63 (.43) 0.00
Year ended 9/30/92........ 12.64 .44 .57 1.01 (.45) 0.00
Year ended 9/30/91........ 10.41 .46 2.17 2.63 (.40) 0.00
Year ended 9/30/90........ 14.13 .45 (2.14) (1.69) (.40) (1.63)
Year ended 9/30/89........ 12.53 .42 2.18 2.60 (.46) (.54)
Year ended 9/30/88........ 16.33 .46 (1.07) (.61) (.44) (2.75)
Year ended 9/30/87........ 14.64 .67 1.62 2.29 (.60) 0.00
Year ended 9/30/86........ 11.74 .68 3.40 4.08 (.65) (.53)
Year ended 9/30/85........ 10.41 .68 1.67 2.35 (.81) (.21)(j)
Class B
Period ended 7/31/94**.... $14.27 $ .22 $ (.75) $ (.53) $(.22) $ (.29)
Year ended 9/30/93........ 13.13 .29 1.22 1.51 (.37) 0.00
Year ended 9/30/92........ 12.61 .37 .54 .91 (.39) 0.00
2/4/91++ to 9/30/91....... 11.84 .25 .80 1.05 (.28) 0.00
Class C
Period ended 7/31/94**.... $14.28 $ .24 $ (.77) $ (.53) $(.22) $ (.29)
5/3/93++ to 9/30/93....... 13.63 .11 .71 .82 (.17) 0.00
</TABLE>
- --------------------------------------------------------------------------------
Please refer to the footnotes on pages 14 and 15.

12
<PAGE>

<TABLE>
<CAPTION>
Total Net Assets Ratio of
Total Net Asset Investment At End Of Ratio Of Net Investment
Dividends Value Return Based Period Expenses Income (Loss)
And End of on Net Asset (000's To Average To Average Portfolio
Fiscal Year or Period Distributions Period Value (a) omitted) Net Assets Net Assets Turnover Rate
- --------------------- ------------- ------------- ------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
New Europe Fund
Class A
Period ended 7/31/94**.... $ 0.00 $12.66 1.04% $ 86,739 2.06%* 1.85%* 35%
Year ended 2/28/94........ 0.00 12.53 33.73 90,372 2.30 .17 94
Year ended 2/28/93........ (.15) 9.37 (2.82) 79,285 2.25 .47 125
Year ended 2/29/92........ (.02) 9.81 .74 108,510 2.24 .16 34
4/2/90+ to 2/28/91........ (.70) 9.76 (5.63) 188,016 1.52* 2.71* 48
Class B
Period ended 7/31/94**.... $ 0.00 $12.41 .73% $ 31,404 2.76%* 1.15%* 35%
Year ended 2/28/94........ 0.00 12.32 32.76 20,729 3.02 (.52) 94
Year ended 2/28/93........ (.11) 9.28 (3.49) 1,732 3.00 (.50) 125
3/5/91++ to 2/29/92....... (.02) 9.74 .03 1,423 3.02* (.71)* 34
Class C
Period ended 7/31/94**.... $ 0.00 $12.42 .73% $ 11,875 2.76%* 1.15%* 35%
5/3/93++ to 2/28/94....... 0.00 12.33 20.77 10,886 3.00* (.52)* 94
Global Small Cap Fund
Class A
Period ended 7/31/94**.... $ 0.00 $11.08 (1.42)% $ 61,372 2.42%* (1.26)%* 78%
Year ended 9/30/93........ (.43) 11.24 25.83 65,713 2.53 (1.13) 97
Year ended 9/30/92........ (.03) 9.33 (11.30) 58,491 2.34 (.85) 108
Year ended 9/30/91........ 0.00 10.55 27.72 84,370 2.29 (.55) 104
Year ended 9/30/90........ (3.11) 8.26 (31.90) 68,316 1.73 (.46) 89
Year ended 9/30/89........ (.09) 15.54 37.34 113,583 1.56 (.17) 106
Year ended 9/30/88........ (1.78) 11.41 (8.11) 90,071 1.54(f) (.50)(f) 74
Year ended 9/30/87........ (4.52) 15.07 34.11 113,305 1.41(f) (.44)(f) 98
Year ended 9/30/86........ (1.26) 15.47 31.76 90,354 1.22(f) .30(f) 107
Year ended 9/30/85........ (1.13) 12.94 2.74 76,220 1.27(f) .51(f) 72
Class B
Period ended 7/31/94**.... $ 0.00 $10.78 (2.00)% $ 3,889 3.15%* (1.93)%* 78%
Year ended 9/30/93........ (.43) 11.00 24.97 1,150 3.26 (1.85) 97
Year ended 9/30/92........ (.03) 9.20 (12.03) 819 3.11 (1.31) 108
Year ended 9/30/91........ 0.00 10.49 27.00 121 2.98 (1.39) 104
9/17/90++ to 9/30/90...... 0.00 8.26 (9.43) 183 2.61* (1.30)* 89
Class C
Period ended 7/31/94**.... $ 0.00 $10.79 (1.91)% $ 1,330 3.13%* (1.92)%* 78%
5/3/93++ to 9/30/93....... 0.00 11.00 11.56 261 3.75* (2.51)* 97
Strategic Balanced Fund (i)
Class A
Period ended 7/31/94**.... $ 0.00 $16.26 (1.22)% $ 9,640 1.40%*(f) 1.63%* 21%
Year ended 4/30/94........ (1.41) 16.46 5.06 9,822 1.40 (f) 1.67 139
Year ended 4/30/93........ (1.07) 16.97 5.85 8,637 1.40 (f) 2.29 98
Year ended 4/30/92........ (.49) 17.06 20.96 6,843 1.40 (f) 1.92 103
9/4/90++ to 4/30/91....... (.03) 14.48 16.00 443 1.40*(f) 3.54* 137
Class B
Period ended 7/31/94**.... $ 0.00 $14.10 (1.40)% $ 43,578 2.10%*(f) .92%* 21%
Year ended 4/30/94........ (1.31) 14.30 4.29 43,616 2.10 (f) .93 139
Year ended 4/30/93........ (1.35) 14.92 4.96 36,155 2.15 (f) 1.55 98
Year ended 4/30/92........ (1.37) 15.51 20.14 31,842 2.15 (f) 1.34 103
Year ended 4/30/91........ (.47) 13.96 16.73 22,552 2.10 (f) 3.23 137
Year ended 4/30/90........ (.67) 12.40 8.85 19,523 2.00 (f) 3.85 120
Year ended 4/30/89........ (1.07) 11.97 14.66 5,128 2.00 (f) 4.31 103
10/23/87+ to 4/30/88...... (.06) 11.45 15.10 2,344 2.00*(f) 2.44* 72
Class C
Period ended 7/31/94**.... $ 0.00 $14.11 (1.40)% $ 4,317 2.10%*(f) .93%* 21%
8/2/93++ to 4/30/94....... (1.31) 14.31 .45 4,289 2.10 (f) .69 139
Balanced Shares
Class A
Period ended 7/31/94**.... $ (.57) $13.38 (3.21)% $157,637 1.27%* 2.50%* 116%
Year ended 9/30/93........ (.43) 14.40 12.52 172,484 1.35 2.50 188
Year ended 9/30/92........ (.45) 13.20 8.14 143,883 1.40 3.26 204
Year ended 9/30/91........ (.40) 12.64 25.52 154,230 1.44 3.75 70
Year ended 9/30/90........ (2.03) 10.41 (13.12) 140,913 1.36 4.01 169
Year ended 9/30/89........ (1.00) 14.13 22.27 159,290 1.42 3.29 132
Year ended 9/30/88........ (3.19) 12.53 (1.10) 111,515 1.42 3.74 190
Year ended 9/30/87........ (.60) 16.33 15.80 129,786 1.17 4.14 136
Year ended 9/30/86........ (1.18) 14.64 35.01 78,900 .99 4.78 26
Year ended 9/30/85........ (1.02) 11.74 22.91 40,502 1.15 5.85 19
Class B
Period ended 7/31/94**.... $ (.51) $13.23 (3.80)% $ 14,347 2.05%* 1.73%* 116%
Year ended 9/30/93........ (.37) 14.27 11.65 12,789 2.13 1.72 188
Year ended 9/30/92........ (.39) 13.13 7.32 6,499 2.16 2.46 204
2/4/91++ to 9/30/91....... (.28) 12.61 8.96 1,830 2.13* 3.19* 70
Class C
Period ended 7/31/94**.... $ (.51) $13.24 (3.80)% $ 6,254 2.03%* 1.81%* 116%
5/3/93++ to 9/30/93....... (.17) 14.28 6.01 1,487 2.29* 1.47* 188
</TABLE>
- --------------------------------------------------------------------------------

13
<PAGE>

Class A
3/25/94++ to 10/31/94.... $10.00 $ .96 $(1.02) $ (.06) $(.05)(g) $ (.20)

Class B
3/25/94++ to 10/31/94.... $10.00 $ .88 $ (.98) $ (.10) $(.06)(g) $ (.16)

Class C
Year ended 10/31/94...... $10.47 $ .50 $ (.85) $ (.35) $(.11)(g) $ (.35)
Year ended 10/31/93...... 9.80 .52 .51 1.03 (.36) 0.00
Year ended 10/31/92...... 10.00 .55 (.28) .27 (.47) 0.00
10/25/91+ to 10/31/91.... 10.00 .01 0.00 .01 (.01) 0.00

Utility Income Fund

Class A
Year ended 11/30/94...... $ 9.92 $ .42 (c) $ (.89) $ (.47) $(.48) $ 0.00
10/18/93+ to 11/30/93.... 10.00 .02 (c) (.10) (.08) 0.00 0.00

Class B
Year ended 11/30/94...... $ 9.91 $ .37 (c) $ (.91) $ (.54) $(.41) $ 0.00
10/18/93+ to 11/30/93.... 10.00 .01 (c) (.10) (.09) 0.00 0.00

Class C
Year ended 11/30/94...... $ 9.92 $ .39 (c) $ (.93) $ (.54) $(.41) $ 0.00
10/27/93+ to 11/30/93.... 10.00 .01 (c) (.09) (.08) 0.00 0.00

Growth and Income Fund

Class A
Year ended 10/31/94...... $ 2.61 $ .06 $ (.08) $ (.02) $(.06) (.18)
Year ended 10/31/93...... 2.48 .06 .29 .35 (.06) (.16)
Year ended 10/31/92...... 2.52 .06 .11 .17 (.06) (.15)
Year ended 10/31/91...... 2.28 .07 .56 .63 (.09) (.30)
Year ended 10/31/90...... 3.02 .09 (.30) (.21) (.10) (.43)
Year ended 10/31/89...... 3.05 .10 .43 .53 (.08) (.48)
Year ended 10/31/88...... 3.48 .10 .33 .43 (.08) (.78)
Year ended 10/31/87...... 3.52 .11 (.03) .08 (.12) 0.00
Year ended 10/31/86...... 3.01 .12 .92 1.04 (.13) (.40)
Year ended 10/31/85...... 2.93 .14 .42 .56 (.15) (.33)
Year ended 10/31/84...... 3.20 .14 .03 .17 (.13) (.31)

Class B
Year ended 10/31/94...... $ 2.60 $ .04 $ (.08) $ (.04) $(.04) (.18)
Year ended 10/31/93...... 2.47 .05 .28 .33 (.04) (.16)
Year ended 10/31/92...... 2.52 .04 .11 .15 (.05) (.15)
2/8/91++ to 10/31/91..... 2.40 .04 .12 .16 (.04) 0.00

Class C
Year ended 10/31/94...... $ 2.60 $ .04 $ (.08) $ (.04) (.04) (.18)
5/3/93 ++ to 10/31/93.... 2.43 .02 .17 .19 (.02) 0.00
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>

+ Commencement of operations.
++ Commencement of distribution.
* Annualized.
** Reflects newly adopted fiscal year end.
(a) Total investment return is calculated assuming an initial investment made
at the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at the net asset value during the period, and a
redemption on the last day of the period. Initial sales charge or
contingent deferred sales charge is not reflected in the calculation of
total investment return. Total investment returns calculated for periods
of less than one year are not annualized.
(b) Based on average shares outstanding.
(c) Net of expense reimbursement.
(d) Adjusted for a 200% stock dividend paid to shareholders of record on
January 15, 1988.
(e) Net of offering costs of ($.05).
(f) Net of expenses assumed and/or waived/reimbursed. If GROWTH FUND had borne
all expenses, the expense ratios would have been, with respect to Class A
shares, 8.79% (annualized) for 1991, 1.94% for 1992, 1.84% for 1993 and
1.46% for the fiscal period ended April 30, 1994; with respect to Class B
shares, 13.92% (annualized) for 1988, 7.03% for 1989, 3.62% for 1990, 3.06%
for 1991, 2.65% for 1992, 2.52% for 1993 and 2.13% for the fiscal period
ended April 30, 1994; and with respect to Class C shares, 2.13% (annualized
for the fiscal period ended April 30, 1994. If PREMIER GROWTH FUND had
borne all expenses, the expense ratios would have been 3.33% and 3.78% for
Class A and Class B shares, respectively; and net investment income ratios
would have been (.25)% and (.75)% for Class A and Class B shares,
respectively. If COUNTERPOINT FUND had borne all expenses, the expense
ratios for Class A shares would have been 1.77%, 1.60% and 1.73% for the
periods ended in 1985, 1986 and 1987, respectively; and the investment
income ratios for Class A shares would have been 2.93% for 1985, 2.83% for
1986 and 1.51% for 1987. If TECHNOLOGY FUND had borne all expenses, the
expense ratios would have been 1.39%, 1.43%, 1.40%, 1.59% and 1.73% for the
periods ended in 1984, 1985, 1986, 1987, and 1988, respectively; and the
investment income ratios would have been .87% for

14
<PAGE>

<TABLE>
<CAPTION>
Total Net Assets Ratio Of
Total Net Asset Investment At End Of Ratio Of Net Investment
Dividends Value Return Based Period Expenses Income (Loss)
And End Of on Net Asset (000's To Average To Average Portfolio
Fiscal Year or Period Distributions Period Value (a) omitted) Net Assets Net Assets Turnover Rate
- --------------------- ------------- ------------- ------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>

Income Builder Fund (h)

Class A
3/25/94++ to 10/31/94.... $ (.25) $ 9.69 (.54)% $ 600 2.52%* 6.11%* 126%

Class B
3/25/94++ to 10/31/94.... $ (.22) $ 9.68 (.99)% $ 1,998 3.09%* 5.07%* 126%

Class C
Year ended 10/31/94...... $ (.46) $ 9.66 (3.44)% $ 64,027 2.67% 3.82% 126%
Year ended 10/31/93...... (.36) 10.47 10.65 106,034 2.32 6.85 101
Year ended 10/31/92...... (.47) 9.80 2.70 152,617 2.33 5.47 108
10/25/91+ to 10/31/91.... (.01) 10.00 .11 41,813 0.00* (f) .94* 0

Utility Income Fund

Class A
Year ended 11/30/94...... $ (.48) $ 8.97 (4.86)% $ 1,068 1.50%(f) 4.13%(f) 30%
10/18/93+ to 11/30/93.... 0.00 9.92 (.80) 229 1.50*(f) 2.35*(f) 11

Class B
Year ended 11/30/94...... $ (.41) $ 8.96 (5.59)% $ 2,352 2.20%(f) 3.53%(f) 30%
10/18/93+ to 11/30/93.... 0.00 9.91 (.90) 244 2.20*(f) 2.84*(f) 11

Class C
Year ended 11/30/94...... $ (.41) $ 8.97 (5.58)% $ 2,651 2.20%(f) 3.60%(f) 30%
10/27/93+ to 11/30/93.... 0.00 9.92 (.80) 18 2.20*(f) 3.08*(f) 11

Growth and Income Fund

Class A
Year ended 10/31/94...... $ (.24) $ 2.35 (.67)% $414,386 1.03% 2.36% 68%
Year ended 10/31/93...... (.22) 2.61 14.98 459,372 1.07 2.38 91
Year ended 10/31/92...... (.21) 2.48 7.23 417,018 1.09 2.63 104
Year ended 10/31/91...... (.39) 2.52 31.03 409,597 1.14 2.74 84
Year ended 10/31/90...... (.53) 2.28 (8.55) 314,670 1.09 3.40 76
Year ended 10/31/89...... (.56) 3.02 21.59 377,168 1.08 3.49 79
Year ended 10/31/88...... (.86) 3.05 16.45 350,510 1.09 3.09 66
Year ended 10/31/87...... (.12) 3.48 2.04 348,375 .86 2.77 60
Year ended 10/31/86...... (.53) 3.52 34.92 347,679 .81 3.31 11
Year ended 10/31/85...... (.48) 3.01 19.53 275,681 .95 3.78 15
Year ended 10/31/84...... (.44) 2.93 5.41 258,428 .99 4.54 14

Class B
Year ended 10/31/94...... $ (.22) $ 2.34 (1.50)% $102,546 1.85% 1.56% 68%
Year ended 10/31/93...... (.20) 2.60 14.22 76,633 1.90 1.58 91
Year ended 10/31/92...... (.20) 2.47 6.22 29,656 1.90 1.69 104
2/8/91++ to 10/31/91..... (.04) 2.52 6.83 10,221 1.99* 1.67* 84

Class C
Year ended 10/31/94...... $ (.22) $ 2.34 (1.50)% $ 19,395 1.84% 1.61% 68%
5/3/93 ++ to 10/31/93.... (.02) 2.60 7.85 7,774 1.96* 1.45* 91

- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

1984, (.23)% for 1985, (.85)% for 1986, (.84)% for 1987, and (.46)% for
1988. If QUASAR FUND had borne all expenses, the expense ratios would have
been 1.37% for 1987 and 1.64% for 1988; and the investment income ratios
would have been (.75)% for 1987 and (.75)% for 1988. If GLOBAL SMALL CAP
FUND had borne all expenses, the expense ratios would have been 1.46% for
1985, 1.33% for 1986, 1.61% for 1987 and 1.86% for 1988; and the investment
income ratios would have been .32% for 1985, .19% for 1986, (.63)% for 1987
and (.82)% for 1988. If STRATEGIC BALANCED FUND had borne all expenses, the
expense ratios would have been, with respect to Class A Shares, 11.59%
(annualized) for 1991, 2.05% for 1992, 1.85% for 1993 and 1.70% for the
fiscal year ended April 30, 1994 and 1.94% (annualized) for the fiscal
period ended July 31, 1994; with respect to Class B Shares, 10.61%
(annualized) for 1988, 7.82% for 1989, 3.59% for 1990, 2.93% for 1991,
2.70% for 1992, 2.56% for 1993 and 2.42% for the fiscal year ended April
30, 1994 and 2.64% (annualized) for the fiscal period ended July 31, 1994;
and with respect to Class C shares, 2.07% (annualized) for the fiscal
period ended April 30, 1994 and 2.64% (annualized) for the fiscal period
ended July 31, 1994. If INCOME BUILDER FUND had borne all expenses, the
expense ratio would have been 1.99% (annualized). If UTILITY INCOME FUND
had borne all expenses, the expense ratios would have been 145.63%, 133.62%
and 148.03% for Class A, Class B and Class C shares, respectively, for the
fiscal period ended April 30, 1993 and 13.72%, 14.42% and 14.42% for Class
A, Class B, and Class C shares, respectively, for 1994.
(g) "Dividends from Net Investment Income" includes a return of capital. INCOME
BUILDER FUND had a return of capital with respect to Class A shares, for
the period ended October 31, 1994, of $(.01); with respect to Class B
shares, $(.01); and with respect to Class C shares, for the year ended
October 31, 1994, $.02).
(h) On March 25, 1994, all existing shares of INCOME BUILDER FUND, previously
known as Alliance Multi-Market Income and Growth Trust, were converted into
Class C shares.
(i) Prior to July 22, 1993, Equitable Capital Management Corporation
("Equitable Capital") served as the investment adviser to the predecessor
to The Alliance Portfolios, of which GROWTH FUND and STRATEGIC BALANCED
FUND are series. On July 22, 1993, Alliance acquired the business and
substantially all assets of Equitable Capital and became investment adviser
to the Funds.
(j) Includes $(.08) distribution from paid-in capital.

15
<PAGE>

- --------------------------------------------------------------------------------
Glossary
- --------------------------------------------------------------------------------

The following terms are frequently used in this Prospectus.

Equity securities are (i) common stocks, partnership interests, business
trust shares and other equity or ownership interests in business enterprises,
and (ii) securities convertible into, and rights and warrants to subscribe
for the purchase of, such stocks, shares and interests.

Debt securities are bonds, debentures, notes, bills, repurchase agreements,
loans, other direct debt instruments and other fixed, floating and variable
rate debt obligations, but do not include convertible securities.

Fixed-income securities are debt securities and dividend-paying preferred
stocks and include floating rate and variable rate instruments.

Convertible securities are fixed-income securities that are convertible into
common stock.

U.S. Government securities are securities issued or guaranteed by the United
States Government, its agencies or instrumentalities.

Foreign government securities are securities issued or guaranteed, as to payment
of principal and interest, by governments, quasi-governmental entities,
governmental agencies or other governmental entities.

Asian company is an entity that (i) is organized under the laws of an Asian
country and conducts business in an Asian country, (ii) derives 50% or more
of its total revenues from business in Asian countries, or (iii) issues
equity or debt securities that are traded principally on a stock exchange in
an Asian country.

Asian countries are Australia, the Democratic Socialist Republic of Sri
Lanka, Hong Kong, the Islamic Republic of Pakistan, Japan, the Kingdom of
Thailand, Malaysia, Negara Brunei Darussalam (Brunei), New Zealand, the
People's Republic of China, the People's Republic of Kampuchea (Cambodia),
the Republic of China (Taiwan), the Republic of India, the Republic of
Indonesia, the Republic of Korea (South Korea), the Republic of the
Philippines, the Republic of Singapore, the Socialist Republic of Vietnam and
the Union of Myanmar.

Moody's is Moody's Investors Service, Inc.

S&P is Standard & Poor's Corporation.

Duff & Phelps is Duff & Phelps Credit Rating Co.

Fitch is Fitch Investors Service, Inc.

Investment grade securities are fixed-income securities rated Baa and above
by Moody's or BBB and above by S&P, Duff & Phelps or Fitch, or determined by
Alliance to be of equivalent quality.

Lower-rated securities are fixed-income securities rated Ba or below by Moody's
or BB or below by S&P, Duff & Phelps or Fitch, or determined by Alliance to be
of equivalent quality, and are commonly referred to as "junk bonds."

Prime commercial paper is commercial paper rated Prime 1 by Moody's or A-1 or
higher by S&P or, if not rated, issued by companies that have an outstanding
debt issue rated Aa or higher by Moody's or AA or higher by S&P.

Qualifying bank deposits are certificates of deposit, bankers' acceptances and
interest-bearing savings deposits of banks having total assets of more than $1
billion and which are members of the Federal Deposit Insurance Corporation.

Rule 144A securities are securities that may be resold pursuant to Rule 144A
under the Securities Act of 1933, as amended (the "Securities Act").

Depositary receipts include American Depositary Receipts ("ADRs"), Global
Depositary Receipts ("GDRs") and other types of depositary receipts.

Commission is the Securities and Exchange Commission.

1940 Act is the Investment Company Act of 1940, as amended.

Code is the Internal Revenue Code of 1986, as amended.

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- --------------------------------------------------------------------------------
Description Of The Funds
- --------------------------------------------------------------------------------

Except as noted, (i) the Funds' investment objectives are "fundamental" and
cannot be changed without shareholder vote, and (ii) the Funds' investment
policies are not fundamental and thus can be changed without a shareholder
vote. No Fund will change a non-fundamental objective or policy without
notifying its shareholders. There is no guarantee that any Fund will achieve
its investment objective.

INVESTMENT OBJECTIVES AND POLICIES

Domestic Stock Funds

The Domestic Stock Funds have been designed to offer investors seeking
capital appreciation a range of alternative approaches to investing in the
U.S. equity markets.

The Alliance Fund

The Alliance Fund, Inc. ("Alliance Fund") is a diversified investment company
that seeks long-term growth of capital and income primarily through
investment in common stocks. The Fund normally invests substantially all of
its assets in common stocks that Alliance believes will appreciate in value,
but it may invest in other types of securities such as convertible
securities, high-grade instruments, U.S. Government securities and
high-quality, short-term obligations such as repurchase agreements, bankers'
acceptances and domestic certificates of deposit and, may invest without
limit in foreign securities. While the diversification and generally high
quality of the Fund's investments cannot prevent fluctuations in market
values, they tend to limit investment risk and contribute to achieving the
Fund's objective. The Fund generally does not effect portfolio transactions
in order to realize short-term trading profits or exercise control.

The Fund may also: (i) make secured loans of its portfolio securities equal
in value up to 25% of its total assets to brokers, dealers and financial
institutions; (ii) enter into repurchase agreements of up to one week in
duration with commercial banks, but only if those agreements together with
any restricted securities and any securities which do not have readily
available market quotations do not exceed 10% of its net assets; and (iii)
write exchange-traded covered call options with respect to up to 25% of its
total assets. For additional information on the use, risks and costs of these
policies and practices see "Additional Investment Practices."

Alliance Growth Fund

Alliance Growth Fund ("Growth Fund") is a diversified investment company that
seeks long-term growth of capital. Current income is only an incidental
consideration. The Fund seeks its objective by investing primarily in equity
securities of companies with favorable earnings outlooks and whose long-term
growth rates are expected to exceed that of the U.S. economy. The Fund's
investment objective is not fundamental.

The Fund may also invest up to 25% of its total assets in lower-rated
fixed-income and convertible securities. See "Risk Considerations--Securities
Ratings" and "--Investment in Lower-Rated Fixed-Income Securities." The Fund
generally will not invest in securities with ratings below Caa- by Moody's
and CCC- by S&P, Duff & Phelps or Fitch or in securities judged by Alliance
to be of comparable investment quality. However, from time to time, the Fund
may invest in securities rated in the lowest grades (i.e., C by Moody's or D
or equivalent by S&P, Duff & Phelps or Fitch), or securities Alliance judges
to be of comparable investment quality, if there are prospects for an upgrade
or a favorable conversion into equity securities. For the fiscal period ended
October 31, 1994, the Fund did not invest in any lower-rated securities. If
the credit rating of a security held by the Fund falls below its rating at
the time of purchase (or Alliance determines that the quality of such
security has so deteriorated), the Fund may continue to hold the security if
such investment is considered appropriate under the circumstances.

The Fund may also: (i) invest in "zero-coupon" bonds and "payment-in-kind"
bonds; (ii) invest in foreign securities, although the Fund will not
generally invest more than 15% of its total assets in foreign securities;
(iii) invest in securities that are not publicly traded, including Rule 144A
securities; (iv) buy or sell foreign currencies, options on foreign
currencies, foreign currency futures contracts (and related options) and deal
in forward foreign exchange contracts; (v) lend portfolio securities
amounting to not more than 25% of its total assets; (vi) enter into
repurchase agreements on up to 25% of its total assets and purchase and sell
securities on a forward commitment basis; (vii) buy and sell stock index
futures contracts and buy and sell options on those contracts and on stock
indices; (viii) purchase and sell futures contracts, options thereon and
options with respect to U.S. Treasury securities; (ix) write covered call and
put options on securities it owns or in which it may invest; and (x) purchase
and sell put and call options. For additional information on the use, risks
and costs of these policies and practices see "Additional Investment Practices."

Alliance Premier Growth Fund

Alliance Premier Growth Fund, Inc. ("Premier Growth Fund") is a non-diversified
investment company that seeks long-term growth of capital by investing
predominantly in the equity securities of a limited number of large, carefully
selected, high-quality U.S. companies that are judged likely to achieve superior
earnings growth. Normally, about 40 companies will be represented in the Fund's
portfolio, with the 25 most highly regarded of these companies usually
constituting approximately 70% of the Fund's net assets. The Fund is thus
atypical from most equity mutual funds in its focus on a relatively small number
of intensively researched companies and is designed for those seeking to
accumulate capital over time with less volatility than that associated with
investment in smaller companies.

As a matter of fundamental policy, the Fund normally invests at least 85% of
its total assets in the equity securities of U.S. companies. These are
companies (i) organized under U.S. law that have their principal office in
the U.S., and (ii) the equity securities of which are traded principally in
the U.S.

Alliance's investment strategy for the Fund emphasizes stock selection and
investment in the securities of a limited number of issuers. Alliance relies
heavily upon the fundamental analysis and research of its large internal
research staff, which generally

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<PAGE>

follows a primary research universe of more than 600 companies that have
strong management, superior industry positions, excellent balance sheets and
superior earnings growth prospects. An emphasis is placed on identifying
companies whose substantially above average prospective earnings growth is
not fully reflected in current market valuations.

In managing the Fund, Alliance seeks to utilize market volatility judiciously
(assuming no change in company fundamentals), striving to capitalize on
apparently unwarranted price fluctuations, both to purchase or increase
positions on weakness and to sell or reduce overpriced holdings. The Fund
normally remains nearly fully invested and does not take significant cash
positions for market timing purposes. During market declines, while adding to
positions in favored stocks, the Fund becomes somewhat more aggressive,
gradually reducing the number of companies represented in its portfolio.
Conversely, in rising markets, while reducing or eliminating fully valued
positions, the Fund becomes somewhat more conservative, gradually increasing
the number of companies represented in its portfolio. Alliance thus seeks to
gain positive returns in good markets while providing some measure of
protection in poor markets.

Alliance expects the average market capitalization of companies represented
in the Fund's portfolio normally to be in the range, or in excess, of the
average market capitalization of companies comprising the "S&P 500" (the
Standard & Poor's 500 Composite Stock Price Index, a widely recognized
unmanaged index of market activity).

The Fund may also: (i) invest up to 20% of its net assets in convertible
securities of companies whose common stocks are eligible for purchase by it;
(ii) invest up to 5% of its net assets in rights or warrants; (iii) invest up
to 15% of its total assets in securities of foreign issuers whose common
stocks are eligible for purchase by it; (iv) purchase and sell
exchange-traded index options and stock index futures contracts; and (v)
write covered exchange-traded call options on common stocks, unless as a result,
the amount of its securities subject to call options would exceed 15% of its
total assets, and purchase and sell exchange-traded call and put options on
common stocks written by others, but the total cost of all options held by the
Fund (including exchange-traded index options) may not exceed 10% of its total
assets. For additional information on the use, risks and costs of these policies
and practices see "Additional Investment Practices." The Fund will not write put
options or invest in illiquid securities if as a result more than 15% of its net
assets would be so invested.

Alliance Counterpoint Fund

Alliance Counterpoint Fund ("Counterpoint Fund") is a diversified investment
company that seeks long-term capital growth by investing principally in price-
depressed, undervalued or out-of-favor equity securities. Secondarily, the Fund
seeks current income. The Fund follows a flexible investment policy which allows
it to shift among equity alternatives depending on such factors as relative
growth rates, normalized price-earnings ratios and yields. It selects securities
based on fundamental business and financial factors (e.g., financial strength,
book values, asset values, earnings and dividends) and reasonable current
valuations (weighing the factors against market prices) and focuses on the
relationship of a company's earning power and dividend payout to the price of
its stock. The Fund's investment strategy can be characterized as unconventional
or "contrarian" in that its holdings often have relatively low normalized price-
earnings ratios and, when purchased, are often believed by Alliance to be
overlooked or undervalued in the marketplace. (A "normalized" price-earnings
ratio is one that has been adjusted to eliminate the effects of the economic
cycle. Alliance may conclude that a company's normalized price-earnings ratio is
low in comparison to either the company's price-earnings history or the price-
earnings ratios of comparable companies.)

Because it evaluates securities based on their long-term potential, the Fund
is best suited for investors who understand and can accept the risk that the
securities held by the Fund may not appreciate or yield significant income
over the shorter term. The Fund invests in companies experiencing poor
operating results, which may include companies whose earnings have been
severely depressed by unfavorable operating conditions or special competitive
or product obsolescence problems, if it believes that they will react
positively to changing economic conditions or will restructure or take other
actions to overcome adversity. The Fund invests in listed and unlisted
securities, and will invest in any company and industry and in any type of
security that may help it achieve its objectives. While its strategy normally
emphasizes equity securities, the Fund also invests in fixed-income
securities when such investments can provide capital growth, such as when
interest rates decline, and to generate income.

The Fund may also: (i) invest up to 5% of its total assets in warrants; (ii)
invest up to 15% of its total assets in foreign securities; (iii) invest in
restricted securities and in other assets having no ready market if as a
result no more than 5% of its net assets would be invested in such securities
and assets; (iv) write exchange-listed covered call options, unless as a
result the amount of its securities subject to call options would exceed 5%
of its total assets; (v) lend portfolio securities equal in value to not more
than 15% of its total assets; (vi) purchase and sell stock index futures
contracts; and (vii) enter into repurchase agreements on U.S. Government
securities with member banks of the Federal Reserve System or primary dealers
in such securities. For additional information on the use, risks and costs of
these policies and practices see "Additional Investment Practices."

Alliance Technology Fund

Alliance Technology Fund, Inc. ("Technology Fund") is a diversified investment
company that emphasizes growth of capital and invests for capital appreciation,
and only incidentally for current income. The Fund may seek income by writing
listed call options. The Fund invests primarily in securities of companies
expected to benefit from technological advances and improvements (i.e.,
companies that use technology extensively in the development of new or improved
products or processes). The Fund will normally have at least

18
<PAGE>

80% of its assets invested in the securities of these companies. The Fund
normally will have substantially all its assets invested in equity
securities, but it also invests in debt securities offering an opportunity
for price appreciation. The Fund will invest in listed and unlisted
securities and U.S. and foreign securities, but it will not purchase a
foreign security if as a result 10% or more of the Fund's total assets would
be invested in foreign securities.

The Fund's policy is to invest in any company and industry and in any type of
security with potential for capital appreciation. It invests in well-known
and established companies and in new and unseasoned companies.

The Fund may also: (i) write and purchase exchange-listed call options and
purchase listed put options, including exchange-traded index put options;
(ii) invest up to 10% of its total assets in warrants; (iii) invest in
restricted securities and in other assets having no ready market if as a
result no more than 10% of the Fund's net assets are invested in such
securities and assets; (iv) lend portfolio securities equal in value to not
more than 30% of the Fund's total assets; and (v) invest up to 10% of its
total assets in foreign securities. For additional information on the use,
risks and costs of the policies and practices see "Additional Investment
Practices."

Alliance Quasar Fund

Alliance Quasar Fund, Inc. ("Quasar Fund") is a diversified investment
company that seeks growth of capital by pursuing aggressive investment
policies. It invests for capital appreciation and only incidentally for
current income. The selection of securities based on the possibility of
appreciation cannot prevent loss in value. Moreover, because the Fund's
investment policies are aggressive, an investment in the Fund is risky and
investors who want assured income or preservation of capital should not invest
in the Fund.

The Fund invests in any company and industry and in any type of security with
potential for capital appreciation. It invests in well-known and established
companies and in new and unseasoned companies. When selecting securities,
Alliance considers the economic and political outlook, the values of specific
securities relative to other investments, trends in the determinants of
corporate profits and management capability and practices.

The Fund invests principally in equity securities, but it also invests to a
limited degree in non-convertible bonds and preferred stocks. The Fund
invests in listed and unlisted U.S. and foreign securities. The Fund
periodically invests in special situations, which occur when the securities
of a company are expected to appreciate due to a development particularly or
uniquely applicable to that company and regardless of general business
conditions or movements of the market as a whole.

The Fund may also: (i) invest in restricted securities and in other assets
having no ready market, but not more than 10% of its total assets may be
invested in such securities or assets; (ii) make short sales of securities
"against the box," but not more than 15% of its net assets may be deposited
on short sales; and (iii) write call options and purchase and sell put and
call options written by others. For additional information on the use, risks
and costs of these policies and practices see "Additional Investment
Practices."

Global Stock Funds

The Global Stock Funds have been designed to enable investors to participate
in the potential for long-term capital appreciation available from investment
in foreign securities.

Alliance International Fund

Alliance International Fund ("International Fund") is a diversified
investment company that seeks a total return on its assets from long-term
growth of capital and from income primarily through a broad portfolio of
marketable securities of established non-U.S. companies, companies
participating in foreign economies with prospects for growth, including U.S.
companies having their principal activities and interests outside the U.S.
and foreign government securities. Normally, more than 80% of the Fund's assets
will be invested in such issuers.

The Fund expects to invest primarily in common stocks of established non-U.S.
companies that Alliance believes have potential for capital appreciation or
income or both, but the Fund is not required to invest exclusively in common
stocks or other equity securities, and it may invest in any other type of
investment grade security, including convertible securities, warrants, or
obligations of the U.S. or foreign governments and their political
subdivisions.

The Fund intends to diversify its investments broadly among countries and
normally invests in at least three foreign countries, although it may invest
a substantial portion of its assets in one or more of such countries. At July
31, 1994, approximately 50% of the Fund's assets were invested in securities
of Japanese issuers. The Fund may invest in companies, wherever organized,
that Alliance judges have their principal activities and interests outside
the U.S. These companies may be located in developing countries, which
involves exposure to economic structures that are generally less diverse and
mature, and to political systems which can be expected to have less
stability, than those of developed countries. The Fund currently does not
intend to invest more than 10% of its total assets in companies in, or
governments of, developing countries.

The Fund may also: (i) purchase or sell forward foreign currency exchange
contracts; (ii) write, sell and purchase U.S. or foreign exchange-listed put
and call options, including exchange-traded index options; (iii) enter into
financial futures contracts, including contracts for the purchase or sale for
future delivery of foreign currencies and stock index futures, and purchase
and write put and call options on futures contracts traded on U.S. or foreign
exchanges or over-the-counter; (iv) purchase and write put options on foreign
currencies traded on securities exchanges or boards of trade or
over-the-counter; (v) lend portfolio securities equal in value to not more
than 30% of its total assets; and (vi) enter into repurchase agreements of up
to seven days' duration,

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<PAGE>

provided that more than 10% of the Fund's total assets would be so invested.
For additional information on the use, risks and costs of these policies and
practices see "Additional Investment Practices."

Alliance Worldwide Privatization Fund

Alliance Worldwide Privatization Fund, Inc. ("Worldwide Privatization Fund")
is a non-diversified investment company that seeks long-term capital
appreciation. As a fundamental policy, the Fund invests at least 65% of its
total assets in equity securities issued by enterprises that are undergoing,
or have undergone, privatization (as described below), although normally
significantly more of its assets will be invested in such securities. The
balance of its investments will include securities of companies believed by
Alliance to be beneficiaries of privatizations. The Fund is designed for
investors desiring to take advantage of investment opportunities,
historically inaccessible to U.S. individual investors, that are created by
privatizations of state enterprises in both established and developing
economies, including those in Western Europe and Scandinavia, Australia, New
Zealand, Latin America, Asia and Eastern and Central Europe and, to a lesser
degree, Canada and the United States.

The Fund's investments in enterprises undergoing privatization may comprise
three distinct situations. First, the Fund may invest in the initial offering
of publicly traded equity securities (an "initial equity offering") of a
government- or state-owned or controlled company or enterprise (a "state
enterprise"). Secondly, the Fund may purchase securities of a current or
former state enterprise following its initial equity offering. Finally, the
Fund may make privately negotiated purchases of stock or other equity
interests in a state enterprise that has not yet conducted an initial equity
offering. Alliance believes that substantial potential for capital
appreciation exists as privatizing enterprises rationalize their management
structures, operations and business strategies in order to compete
efficiently in a market economy, and the Fund will thus emphasize investments
in such enterprises.

The Fund diversifies its investments among a number of countries and normally
invests in issuers based in at least four, and usually considerably more,
countries. No more than 15% of the Fund's total assets, however, will be
invested in issuers in any one foreign country, except that the Fund may
invest up to 30% of its total assets in issuers in any one of France,
Germany, Great Britain, Italy and Japan. The Fund may invest all of its
assets within a single region of the world. To the extent that the Fund's
assets are invested within any one region, the Fund may be subject to any
special risks that may be associated with that region.

Privatization is a process through which the ownership and control of
companies or assets changes in whole or in part from the public sector to the
private sector. Through privatization a government or state divests or
transfers all or a portion of its interest in a state enterprise to some form
of private ownership. Governments and states with established economies,
including France, Great Britain, Germany and Italy, and those with developing
economies, including Argentina, Mexico, Chile, Indonesia, Malaysia, Poland
and Hungary, are engaged in privatizations. Although the Fund will invest in
any country believed to present attractive investment opportunities,
currently approximately 70% of the Fund's total assets are invested in
countries with established economies.

A major premise of the Fund's approach is that the equity securities of
privatized companies offer opportunities for significant capital
appreciation. In particular, because privatizations are integral to a
country's economic restructuring, securities sold in initial equity offerings
often are priced attractively so as to secure the issuer's successful
transition to private sector ownership. Additionally, these enterprises often
dominate their local markets and typically have the potential for significant
managerial and operational efficiency gains.

Although the Fund anticipates that it will not concentrate its investments in
any industry, it is permitted to invest more than 25% of its total assets in
issuers whose primary business activity is that of national commercial
banking. Prior to so concentrating, however, the Fund's Directors must
determine that its ability to achieve its investment objective would be
adversely affected if it were not permitted to concentrate. The staff of the
Commission is of the view that registered investment companies may not,
absent shareholder approval, change between concentration and
non-concentration in a single industry. The Fund disagrees with the staff's
position but has undertaken that it will not concentrate in the securities of
national commercial banks until, if ever, the issue is resolved. If the Fund
were to invest more than 25% of its total assets in national commercial
banks, the Fund's performance could be significantly influenced by events or
conditions affecting this industry, which is subject to, among other things,
increases in interest rates and deteriorations in general economic
conditions, and the Fund's investments may be subject to greater risk and
market fluctuation than if its portfolio represented a broader range of
investments.

The Fund may invest up to 35% of its total assets in debt securities and
convertible debt securities of issuers whose common stocks are eligible for
purchase by the Fund. The Fund may maintain not more than 5% of its net
assets in lower-rated securities. See "Risk Considerations-- Securities
Ratings" and "--Investment in Lower-Rated Fixed-Income Securities." The Fund
will not retain a non-convertible security that is downgraded below C or
determined by Alliance to have undergone similar credit quality deterioration
following purchase.

The Fund may also: (i) invest up to 20% of its total assets in rights or
warrants; (ii) write covered put and call options and purchase put and call
options on securities of the types in which it is permitted to invest and on
exchange-traded index options; (iii) enter into contracts for the purchase or
sale for future delivery of fixed-income securities or foreign currencies, or
contracts based on financial indices, including any index of U.S. Government
securities, foreign government securities, or common stock and may purchase
and write options on future contracts; (iv) purchase and write put and call
options on

20
<PAGE>

foreign currencies for hedging purposes; (v) purchase or sell forward
contracts; (vi) enter in forward commitments for the purchase or sale of
securities; (vii) enter into standby commitment agreements; (viii) enter into
currency swaps for hedging purposes; (ix) enter into repurchase agreements
pertaining to U.S. Government securities with member banks of the Federal
Reserve System or primary dealers in such securities; (x) make short sales of
securities or maintain a short position; and (xi) make secured loans of its
portfolio securities not in excess of 30% of its total assets to entities
with which it can enter into repurchase agreements. For additional
information on the use, risks and costs of these policies and practices see
"Additional Investment Practices".

Alliance New Europe Fund

Alliance New Europe Fund, Inc. ("New Europe Fund") is a non-diversified
investment company that seeks long-term capital appreciation through
investment primarily in the equity securities of companies based in Europe.
The Fund intends to invest substantially all of its assets in the equity
securities of European companies and has a fundamental policy of normally
investing at least 65% of its total assets in such securities. Up to 35% of
its total assets may be invested in high-quality U.S. dollar or foreign
currency denominated fixed-income securities issued or guaranteed by European
governmental entities, or by European or multinational companies or
supranational organizations.

Alliance believes that the quickening pace of economic integration and
political change in Europe creates the potential for many European companies
to experience rapid growth and that the emergence of new market economies in
Europe and the broadening and strengthening of other European economies may
significantly accelerate economic development. The Fund will invest in
companies that Alliance believes possess rapid growth potential. Thus, the
Fund will emphasize investments in smaller, emerging companies, but will also
invest in larger, established companies in such growing economic sectors as
capital goods, telecommunications, pollution control and consumer services.

The Fund will emphasize investment in companies believed to be the likely
beneficiaries of a program, originally known as the "1992 Program," to remove
substantially all barriers to the free movement of goods, persons, services
and capital within the European Community. Alliance believes that the
beneficial effects of this program upon economies, sectors and companies may
be most pronounced in the decade following 1992. The European Community is a
Western European economic cooperative organization consisting of Belgium,
Denmark, France, Germany, Greece, Ireland, Italy, Luxembourg, the
Netherlands, Portugal, Spain and the United Kingdom.

In recent years, economic ties between the former "east bloc" countries of
Eastern Europe and certain other European countries have been strengthened.
Alliance believes that as this strengthening continues, some Western European
financial institutions and other companies will have special opportunities to
facilitate East-West transactions. The Fund will seek investment
opportunities among such companies and, as such become available, within the
former "east bloc," although the Fund will not invest more than 20% of its
total assets in issuers based therein, or more than 10% of its total assets
in issuers based in any one such country.

The Fund diversifies its investments among a number of European countries
and, under normal circumstances, will invest in companies based in at least
three such countries. Subject to the foregoing and to the limitation on
investment in any one former "east bloc" country, the Fund may invest without
limit in a single European country. While the Fund does not intend to
concentrate its investments in a single country, at times 25% or more of its
assets may be invested in issuers located in a single country. During such
times, the Fund would be subject to a correspondingly greater risk of loss
due to adverse political or regulatory developments, or an economic downturn,
within that country. At July 31, 1994, approximately 32% of the Fund's assets
were invested in securities of issuers in the United Kingdom.

The Fund may also: (i) invest up to 10% of its total assets in securities for
which there is no ready market; (ii) invest up to 20% of its total assets in
warrants and rights to purchase equity securities of European companies; (iii)
invest in depositary receipts or other securities convertible into securities of
companies based in European countries, debt securities of supranational entities
denominated in the currency of any European country, debt securities denominated
in European Currency Units of an issuer in a European country (including
supranational issuers) and "semi-governmental securities"; (iv) purchase and
sell forward contracts; (v) write, sell and purchase exchange-traded put and
call options, including exchange-traded index options; (vi) enter into financial
futures contracts, including contracts for the purchase or sale for future
delivery of foreign currencies and futures contracts based on stock indices, and
purchase and write options on futures contracts; (vii) purchase and write put
options on foreign currencies traded on securities exchanges or boards of trade
or over-the-counter; (viii) make secured loans of portfolio securities not in
excess of 30% of its total assets to brokers, dealers and financial
institutions; (ix) enter into forward commitments for the purchase or sale of
securities; and (x) enter into standby commitment agreements. For additional
information on the use, risks and costs of these policies and practices see
"Additional Investment Practices."

Alliance All-Asia Investment Fund

Alliance All-Asia Investment Fund, Inc. ("All-Asia Fund") is a non-diversified
investment company whose investment objective is to seek long-term capital
appreciation. In seeking to achieve its investment objective, the Fund will
invest at least 65% of its total assets in equity securities (for the purposes
of this investment policy, rights, warrants and options to purchase common
stocks are not deemed to be equity securities), preferred stocks and equity-
linked debt securities issued by Asian companies. The Fund may invest up to 35%
of its total assets in debt securities issued or guaranteed by Asian companies
or by Asian governments, their

21
<PAGE>

agencies or instrumentalities. The Fund may also invest in securities issued
by non-Asian issuers, provided that the Fund will invest at least 80% of its
total assets in securities issued by Asian companies and the Asian debt
securities referred to above. The Fund expects to invest, from time to time,
a significant portion, but less than 50%, of its assets in equity securities
of Japanese companies.

In the past decade, Asian countries generally have experienced a high level
of real economic growth due to political and economic changes, including
foreign investment and reduced government intervention in the economy.
Alliance believes that certain conditions exist in Asian countries which
create the potential for continued rapid economic growth. These conditions
include favorable demographics and competitive wage rates, increasing levels
of foreign direct investment, rising per capita incomes and consumer demand,
a high savings rate and numerous privatization programs. Asian countries are
also becoming more industrialized and are increasing their intra-Asian
exports while reducing their dependence on Western export demand. Alliance
believes that these conditions are important to the long-term economic growth
of Asian countries.

As the economies of many Asian countries move through the "emerging market"
stage, thus increasing the supply of goods, services and capital available to
less developed Asian markets and helping to spur economic growth in those
markets, the potential is created for many Asian companies to experience
rapid growth. In addition, many Asian companies the securities of which are
listed on exchanges in more developed Asian countries will be participants in
the rapid economic growth of the lesser developed countries. These companies
generally offer the advantages of more experienced management and more
developed market regulation.

As their economies have grown, the securities markets in Asian countries have
also expanded. New exchanges have been created and the number of listed
companies, annual trading volume and overall market capitalization have
increased significantly. Additionally, new markets continue to open to
foreign investments. For example, South Korea and India have recently relaxed
investment restrictions and Vietnamese direct investments have recently
become available to U.S. investors. The Fund also offers investors the
opportunity to access relatively restricted markets. Alliance believes that
investment opportunities in Asian countries will continue to expand.

The Fund will invest in companies believed to possess rapid growth potential.
Thus, the Fund will invest in smaller, emerging companies, but will also
invest in larger, more established companies in such growing economic sectors
as capital goods, telecommunications and consumer services.

The Fund will invest in investment grade debt securities, except that the
Fund may maintain not more than 5% of its net assets in lower-rated
securities and lower-rated loans and other lower-rated direct debt
instruments. See "Risk Considerations--Securities Ratings" and "--Investment
in Lower-Rated Fixed-Income Securities" and Appendix C in the Fund's
Statement of Additional Information for a description of such ratings. The
Fund will not retain a security that is downgraded below C or determined by
Alliance to have undergone similar credit quality deterioration following
purchase.

The Fund may also: (i) invest up to 25% of its net assets in the convertible
securities of companies whose common stocks are eligible for purchase by the
Fund; (ii) invest up to 20% of its net assets in rights or warrants; (iii)
invest in depositary receipts, instruments of supranational entities
denominated in the currency of any country, securities of multinational
companies and "semi-governmental securities;" (iv) invest up to 25% of its
net assets in equity-linked debt securities with the objective of realizing
capital appreciation; (v) invest up to 25% of its net assets in loans and
other direct debt instruments; (vi) write covered put and call options on
securities of the types in which it is permitted to invest and on
exchange-traded index options; (vii) enter into contracts for the purchase or
sale for future delivery of fixed-income securities or foreign currencies, or
contracts based on financial indices, including any index of U.S. Government
securities, securities issued by foreign government entities, or common stock
and may purchase and write options on future contracts; (viii) purchase and
write put and call options on foreign currencies for hedging purposes; (ix)
purchase or sell forward contracts; (x) enter into interest rate swaps and
purchase or sell interest rate caps and floors; (xi) enter into forward
commitments for the purchase or sale of securities; (xii) enter into standby
commitment agreements; (xiii) enter into currency swaps for hedging purposes;
(xiv) enter into repurchase agreements pertaining to U.S. Government
securities with member banks of the Federal Reserve System or primary dealers
in such securities; (xv) make short sales of securities or maintain a short
position, in each case only if "against the box;" and (xvi) make secured
loans of its portfolio securities not in excess of 30% of its total assets to
entities with which it can enter into repurchase agreements. For additional
information on the use, risks and costs of these policies and practices see
"Additional Investment Practices".

Alliance Global Small Cap Fund

Alliance Global Small Cap Fund, Inc. ("Global Small Cap Fund") is a diversified
investment company that seeks long-term growth of capital through investment in
a global portfolio of the equity securities of selected companies with
relatively small market capitalization. The Fund's portfolio emphasizes
companies with market capitalizations that would have placed them (when
purchased) in about the smallest 20% by market capitalization of actively traded
U.S. companies, or market capitalizations of up to about $1 billion. Because the
Fund applies the U.S. size standard on a global basis, its foreign investments
might rank above the lowest 20%, and, in fact, might in some countries rank
among the largest, by market capitalization in local markets. Normally, the Fund
invests at least 65% of its assets in equity securities of these smaller
capitalization issuers, and these issuers are located in at least three
countries, one of which may be the U.S. Up to 35% of the Fund's total assets may
be invested in securities of

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<PAGE>

companies whose market capitalizations exceed the Fund's size standard. The
Fund's portfolio securities may be listed on a U.S. or foreign exchange or
traded over-the-counter.

Alliance believes that smaller capitalization issuers often have sales and
earnings growth rates exceeding those of larger companies, and that these
growth rates tend to cause more rapid share price appreciation. Investing in
smaller capitalization stocks, however, involves greater risk than is
associated with larger, more established companies. For example, smaller
capitalization companies often have limited product lines, markets, or
financial resources. They may be dependent for management on one or a few key
persons, and can be more susceptible to losses and risks of bankruptcy. Their
securities may be thinly traded (and therefore have to be sold at a discount
from current market prices or sold in small lots over an extended period of
time), may be followed by fewer investment research analysts and may be
subject to wider price swings and thus may create a greater chance of loss
than when investing in securities of larger capitalization companies.
Transaction costs in small capitalization stocks may be higher than in those
of larger capitalization companies.

The Fund may also: (i) invest up to 10% of its total assets in securities for
which there is no ready market; (ii) invest up to 20% of its total assets in
warrants to purchase equity securities; (iii) invest in depositary receipts
or other securities representing securities of companies based in countries
other than the U.S.; (iv) purchase or sell forward foreign currency
contracts; (v) write and purchase exchange-traded call options and purchase
exchange-traded put options, including put options on market indices; and
(vi) make secured loans of portfolio securities not in excess of 30% of its
total assets to brokers, dealers and financial institutions. For additional
information on the use, risks and costs of these policies and practices see
"Additional Investment Practices."

Total Return Funds

The Total Return Funds have been designed to provide a range of investment
alternatives to investors seeking both growth of capital and current income.

Alliance Strategic Balanced Fund

Alliance Strategic Balanced Fund ("Strategic Balanced Fund") is a diversified
investment company that seeks a high long-term total return by investing in a
combination of equity and debt securities. The portion of the Fund's assets
invested in each type of security varies in accordance with economic
conditions, the general level of common stock prices, interest rates and
other relevant considerations, including the risks associated with each
investment medium. The Fund's investment objective is not fundamental.

The Fund's equity securities will generally consist of dividend-paying common
stocks and other equity securities of companies with favorable earnings outlooks
and long-term growth rates that Alliance expects will exceed that of the U.S.
economy. The Fund's debt securities may include U.S. Government securities and
securities issued by private corporations. The Fund may also invest in mortgage-
backed securities, adjustable rate securities, asset-backed securities and so-
called "zero-coupon" bonds and "payment-in-kind" bonds.

As a fundamental policy, the Fund will invest at least 25% of its total
assets in fixed-income securities, which for this purpose include debt
securities, preferred stocks and that portion of the value of convertible
securities that is attributable to the fixed-income characteristics of those
securities.

The Fund's debt securities will generally be of investment grade. See "Risk
Considerations--Securities Ratings" and "--Investment in Lower-Rated
Fixed-Income Securities." In the event that the rating of any debt securities
held by the Fund falls below investment grade, the Fund will not be obligated
to dispose of such obligations and may continue to hold them if considered
appropriate under the circumstances.

The Fund may also: (i) invest in foreign securities, although the Fund will
not generally invest more than 15% of its total assets in foreign securities;
(ii) invest, without regard to this 15% limit, in Eurodollar CDs, which are
dollar-denominated certificates of deposit issued by foreign branches of U.S.
banks that are not insured by any agency or instrumentality of the U.S.
Government; (iii) write covered call and put options on securities it owns or
in which it may invest; (iv) buy and sell put and call options and buy and
sell combinations of put and call options on the same underlying securities;
(v) lend portfolio securities amounting to not more than 25% of its total
assets; (vi) enter into repurchase agreements on up to 25% of its total
assets; (vii) purchase and sell securities on a forward commitment basis;
(viii) buy or sell foreign currencies, options on foreign currencies, foreign
currency futures contracts (and related options) and deal in forward foreign
exchange contracts; (ix) buy and sell stock index futures contracts and buy
and sell options on those contracts and on stock indices; (x) purchase and
sell futures contracts, options thereon and options with respect to U.S.
Treasury securities; and (xi) invest in securities that are not publicly
traded, including Rule 144A securities. For additional information on the
use, risks and costs of these policies and practices see "Additional Investment
Practices."

Alliance Balanced Shares

Alliance Balanced Shares, Inc. ("Balanced Shares") is a diversified investment
company that seeks a high return through a combination of current income and
capital appreciation. Although the Fund's investment objective is not
fundamental, the Fund is a "balanced fund" as a matter of fundamental policy.
The Fund will not purchase a security if as a result less than 25% of its total
assets will be in fixed-income senior securities (including short- and long-term
debt securities, preferred stocks, and convertible debt securities and
convertible preferred stocks to the extent that their values are attributable to
their fixed-income characteristics). Subject to these restrictions, the
percentage of the Fund's assets invested in each type of security will vary. The
Fund's assets are invested in U.S. Government securities,

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<PAGE>

bonds, senior debt securities and preferred and common stocks in such
proportions and of such type as are deemed best adapted to the current
economic and market outlooks. The Fund may invest up to 15% of the value of
its total assets in foreign equity and fixed-income securities eligible for
purchase by the Fund under its investment policies described above. See
"Risk Considerations--Foreign Investment."

The Fund may also: (i) enter into contracts for the purchase or sale for
future delivery of foreign currencies; and (ii) purchase and write put and
call options on foreign currencies and enter into forward foreign currency
exchange contracts for hedging purposes. Subject to market conditions, the
Fund may also seek to realize income by writing covered call options listed
on a domestic exchange. For additional information on the use, risks and
costs of these policies and practices see "Additional Investment Practices."

Alliance Income Builder Fund

Alliance Income Builder Fund, Inc. ("Income Builder Fund") is a non-diversified
investment company that seeks an attractive level of current income and long-
term growth of income and capital by investing principally in fixed-income
securities and dividend-paying common stocks. Its investments in equity
securities emphasize common stocks of companies with a historical or projected
pattern of paying rising dividends. Normally, at least 65% of the Fund's total
assets are invested in income-producing securities. The Fund may vary the
percentage of assets invested in any one type of security based upon Alliance's
evaluation as to the appropriate portfolio structure for achieving the Fund's
investment objective, although Alliance currently maintains approximately 60% of
the Fund's net assets in fixed-income securities and 40% in equity securities.

The Fund may invest in fixed-income securities of domestic and foreign issuers,
including U.S. Government securities and repurchase agreements pertaining
thereto, corporate fixed-income securities of U.S. issuers, qualifying bank
deposits and prime commercial paper.

The Fund may maintain up to 35% of its net assets in lower-rated securities. See
"Risk Considerations--Securities Ratings" and "--Investment in Lower-Rated
Fixed-Income Securities." The Fund will not retain a non-convertible security
that is downgraded below CCC or determined by Alliance to have undergone similar
credit quality deterioration following purchase.

Foreign securities in which the Fund invests may include fixed-income
securities of foreign corporate and governmental issuers, denominated in U.S.
Dollars, and equity securities of foreign corporate issuers, denominated in
foreign currencies or in U.S. Dollars. The Fund will not invest more than 10%
of its net assets in equity securities of foreign issuers nor more than 15%
of its total assets in issuers of any one foreign country. See "Risk
Considerations--Foreign Investment."

The Fund may also: (i) invest up to 5% of its net assets in rights or
warrants; (ii) invest in depositary receipts and U.S. Dollar denominated
securities issued by supranational entities: (iii) write covered put and call
options and purchase put and call options on securities of the types in which
it is permitted to invest that are exchange-traded; (iv) purchase and sell
exchange-traded options on any securities index composed of the types of
securities in which it may invest; (v) enter into contracts for the purchase
or sale for future delivery of fixed-income securities or foreign currencies,
or contracts based on financial indices, including any index of U.S.
Government securities, foreign government securities, corporate fixed income
securities, or common stock, and purchase and write options on future
contracts; (vi) purchase and write put and call options on foreign currencies
and enter into forward contracts for hedging purposes; (vii) enter into
interest rate swaps and purchase or sell interest rate caps and floors;
(viii) enter into forward commitments for the purchase or sale of securities;
(ix) enter into standby commitment agreements; (x) enter into repurchase
agreements pertaining to U.S. Government securities with member banks of the
Federal Reserve System or primary dealers in such securities; (xi) make short
sales of securities or maintain a short position as described below under
"Additional Investment Policies and Practices--Short Sales;" and (xii) make
secured loans of its portfolio securities not in excess of 20% of its total
assets to brokers, dealers and financial institutions. For additional
information on the use, risks and costs of these policies and practices see
"Additional Investment Practices."

Alliance Utility Income Fund

Alliance Utility Income Fund, Inc. ("Utility Income Fund") is a diversified
investment company that seeks current income and capital appreciation by
investing primarily in equity and fixed-income securities of companies in the
utilities industry. The Fund may invest in securities of both U.S. and
foreign issuers, although no more than 15% of the Fund's total assets will be
invested in issuers in any one foreign country. The utilities industry
consists of companies engaged in (i) the manufacture, production, generation,
provision, transmission, sale and distribution of gas and electric energy,
and communications equipment and services, including telephone, telegraph,
satellite, microwave and other companies providing communication facilities
for the public, or (ii) the provision of other utility or utility-related
goods and services, including, but not limited to, entities engaged in water
provision, cogeneration, waste disposal system provision, solid waste
electric generation, independent power producers and non-utility
generators. The Fund is designed to take advantage of the characteristics and
historical performance of securities of utility companies, many of which pay
regular dividends and increase their common stock dividends over time. As a
fundamental policy, the Fund normally invests at least 65% of its total
assets in securities of companies in the utilities industry. The Fund
considers a company to be in the utilities industry if, during the most
recent twelve-month period, at

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<PAGE>

least 50% of the company's gross revenues, on a consolidated basis, were
derived from its utilities activities.

At least 65% of the Fund's total assets are invested in income-producing
securities, but there is otherwise no limit on the allocation of the Fund's
investments between equity securities and fixed-income securities. The Fund
may maintain up to 35% of its net assets in lower-rated securities. See "Risk
Considerations--Securities Ratings" and "--Investment in Lower-Rated
Fixed-Income Securities." The Fund will not retain a security that is
downgraded below B or determined by Alliance to have undergone similar credit
quality deterioration following purchase.

The United States utilities industry has experienced significant changes in
recent years. Electric utility companies in general have been favorably
affected by lower fuel costs, the full or near completion of major
construction programs and lower financing costs. In addition, many utility
companies have generated cash flows in excess of current operating expenses
and construction expenditures, permitting some degree of diversification into
unregulated businesses. Regulatory changes with respect to nuclear and
conventionally fueled generating facilities, however, could increase costs or
impair the ability of such electric utilities to operate such facilities,
thus reducing their ability to service dividend payments with respect to the
securities they issue. Furthermore, rates of return of utility companies
generally are subject to review and limitation by state public utilities
commissions and tend to fluctuate with marginal financing costs. Rate
changes, however, ordinarily lag behind the changes in financing costs, and
thus can favorably or unfavorably affect the earnings or dividend pay-outs on
utilities stocks depending upon whether such rates and costs are declining or
rising.

Gas transmission companies, gas distribution companies and telecommunications
companies are also undergoing significant changes. Gas utilities have been
adversely affected by declines in the prices of alternative fuels, and have
also been affected by oversupply conditions and competition. Telephone
utilities are still experiencing the effects of the break-up of American
Telephone & Telegraph Company, including increased competition and rapidly
developing technologies with which traditional telephone companies now
compete. Although there can be no assurance that increased competition and
other structural changes will not adversely affect the profitability of such
utilities, or that other negative factors will not develop in the future, in
Alliance's opinion, increased competition and change may provide better
positioned utility companies with opportunities for enhanced profitability.

Utility companies historically have been subject to the risks of increases in
fuel and other operating costs, high interest costs, costs associated with
compliance with environmental and nuclear safety regulations, service
interruptions, economic slowdowns, surplus capacity, competition and
regulatory changes. There can also be no assurance that regulatory policies
or accounting standards changes will not negatively affect utility companies'
earnings or dividends. Utility companies are subject to regulation by various
authorities and may be affected by the imposition of special tariffs and
changes in tax laws. To the extent that rates are established or reviewed by
governmental authorities, utility companies are subject to the risk that such
authorities will not authorize increased rates. Because of the Fund's policy
of concentrating its investments in utility companies, the Fund is more
susceptible than most other mutual funds to economic, political or regulatory
occurrences affecting the utilities industry.

Foreign utility companies, like those in the U.S., are generally subject to
regulation, although such regulations may or may not be comparable to
domestic regulations. Foreign utility companies in certain countries may be
more heavily regulated by their respective governments than utility companies
located in the U.S. and, as in the U.S., generally are required to seek
government approval for rate increases. In addition, because many foreign
utility companies use fuels that cause more pollution than those used in the
U.S. such utilities may yet be required to invest in pollution control
equipment. Foreign utility regulatory systems vary from country to country
and may evolve in ways different from regulation in the U.S. The percentage
of the Fund's assets invested in issuers of particular countries will vary.
See "Risk Considerations-- Foreign Investments."

The Fund may invest up to 35% of its total assets in equity and fixed-income
securities of domestic and foreign corporate and governmental issuers other
than utility companies, including U.S. Government securities and repurchase
agreements pertaining thereto, foreign government securities, corporate
fixed-income securities of domestic issuers, corporate fixed-income
securities of foreign issuers denominated in foreign currencies or in U.S.
dollars (in each case including fixed-income securities of an issuer in one
country denominated in the currency of another country), qualifying bank
deposits and prime commercial paper.

The Fund may also: (i) invest up to 30% of its net assets in the convertible
securities of companies whose common stocks are eligible for purchase by the
Fund; (ii) invest up to 5% of its net assets in rights or warrants; (iii)
invest in depositary receipts, securities of supranational entities denominated
in the currency of any country, securities denominated in European Currency
Units and "semi-governmental securities;" (iv) write covered put and call
options and purchase put and call options on securities of the types in which
it is permitted to invest that are exchange-traded and over-the-counter; (v)
purchase and sell exchange-traded options on any securities index composed of
the types of securities in which it may invest; (vi) enter into contracts for
the purchase or sale for future delivery of fixed-income securities or
foreign currencies, or contracts based on financial indices, including an
index of U.S. Government securities, foreign government securities, corporate
fixed-income securities, or common stock, and may purchase and write options
on futures contracts; (vii) purchase and write put and call options on
foreign currencies traded on U.S. and foreign exchanges or over-the-counter
for hedging purposes; (viii) purchase or sell forward contracts; (ix) enter
into interest

25
<PAGE>

rate swaps and purchase or sell interest rate caps and floors; (x) enter in
forward commitments for the purchase or sale of securities; (xi) enter into
standby commitment agreements; (xii) enter into repurchase agreements
pertaining to U.S. Government securities with member banks of the Federal
Reserve System or primary dealers in such securities; (xiii) make short sales
of securities or maintain a short position as described below under
"Additional Investment Practices--Short Sales;" and (xiv) make secured loans
of its portfolio securities not in excess of 20% of its total assets to
brokers, dealers and financial institutions. For additional information on
the use, risk and costs of these policies and practices see "Additional
Investment Practices."

Alliance Growth and Income Fund

Alliance Growth and Income Fund, Inc. ("Growth and Income Fund") is a
diversified investment company that seeks appreciation through investments
primarily in dividend-paying common stocks of good quality, although it is
permitted to invest in fixed-income securities and convertible securities.

The Fund may also try to realize income by writing covered call options
listed on domestic securities exchanges. See "Additional Investment Practices
- --Options." The Fund also invests in foreign securities. Since the purchase of
foreign securities entails certain political and economic risks, the Fund has
restricted its investments in securities in this category to issues of high
quality. See "Risk Considerations--Foreign Investment."

ADDITIONAL INVESTMENT PRACTICES

Some or all of the Funds may engage in the following investment practices to
the extent described above.

Convertible Securities. Prior to conversion, convertible securities have the
same general characteristics as non-convertible debt securities, which
provide a stable stream of income with generally higher yields than those of
equity securities of the same or similar issuers. The price of a convertible
security will normally vary with changes in the price of the underlying
stock, although the higher yield tends to make the convertible security less
volatile than the underlying common stock. As with debt securities, the
market value of convertible securities tends to decline as interest rates
increase and increase as interest rates decline. While convertible securities
generally offer lower interest or dividend yields than non-convertible debt
securities of similar quality, they enable investors to benefit from
increases in the market price of the underlying common stock. Convertible
debt securities that are rated Baa or lower by Moody's or BBB or lower by
S&P, Duff & Phelps or Fitch and comparable unrated securities as determined
by Alliance may share some or all of the risks of non-convertible debt
securities with those ratings. For a description of these risks, see "Risk
Considerations-- Securities Ratings" and "--Investment in Lower-Rated
Fixed-Income Securities."

Rights and Warrants. A Fund will invest in rights or warrants only if the
underlying equity securities themselves are deemed appropriate by Alliance
for inclusion in the Fund's portfolio. Rights and warrants entitle the holder
to buy equity securities at a specific price for a specific period of time.
Rights are similar to warrants except that they have a substantially shorter
duration. Rights and warrants may be considered more speculative than certain
other types of investments in that they do not entitle a holder to dividends
or voting rights with respect to the underlying securities nor do they
represent any rights in the assets of the issuing company. The value of a
right or warrant does not necessarily change with the value of the underlying
security, although the value of a right or warrant may decline because of a
decrease in the value of the underlying security, the passage of time or a
change in perception as to the potential of the underlying security, or any
combination thereof. If the market price of the underlying security is below
the exercise price set forth in the warrant on the expiration date, the
warrant will expire worthless. Moreover, a right or warrant ceases to have
value if it is not exercised prior to the expiration date.

Depositary Receipts and Securities of Supranational Entities. Depositary
receipts may not necessarily be denominated in the same currency as the
underlying securities into which they may be converted. In addition, the
issuers of the stock of unsponsored depositary receipts are not obligated to
disclose material information in the United States and, therefore, there may
not be a correlation between such information and the market value of the
depositary receipts. ADRs are depositary receipts typically issued by a U.S.
bank or trust company that evidence ownership of underlying securities issued
by a foreign corporation. GDRs and other types of depositary receipts are
typically issued by foreign banks or trust companies and evidence ownership
of underlying securities issued by either a foreign or a U.S. company.
Generally, depositary receipts in registered form are designed for use in the
U.S. securities markets, and depositary receipts in bearer form are designed for
use in foreign securities markets. The investments of Growth Fund, Strategic
Balanced Fund and Income Builder Fund in ADRs are deemed to be investments in
securities issued by U.S. issuers and those in GDRs and other types of
depositary receipts are deemed to be investments in the underlying securities.
The investments of All-Asia Fund in depositary receipts are deemed to be
investments in the underlying securities.

A supranational entity is an entity designated or supported by the national
government of one or more countries to promote economic reconstruction or
development. Examples of supranational entities include, among others, the World
Bank (International Bank for Reconstruction and Development) and the European
Investment Bank. A European Currency Unit is a basket of specified amounts of
the currencies of the member states of the European Economic Community. "Semi-
governmental securities" are securities issued by entities owned by either a
national, state or equivalent government or are obligations of one of such
government jurisdictions which are not backed by its full faith and credit and
general taxing powers.

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<PAGE>

Mortgage-Backed Securities. Interest and principal payments (including
prepayments) on the mortgages underlying mortgage-backed securities are
passed through to the holders of the securities. As a result of the
pass-through of prepayments of principal on the underlying securities,
mortgage-backed securities are often subject to more rapid prepayment of
principal than their stated maturity would indicate. Prepayments occur when
the mortgagor on a mortgage prepays the remaining principal before the
mortgage's scheduled maturity date. Because the prepayment characteristics of
the underlying mortgages vary, it is impossible to predict accurately the
realized yield or average life of a particular issue of pass-through
certificates. Prepayments are important because of their effect on the yield
and price of the mortgage-backed securities. During periods of declining
interest rates, prepayments can be expected to accelerate and a Fund
investing in such securities would be required to reinvest the proceeds at
the lower interest rates then available. In addition, prepayments of
mortgages underlying securities purchased at a premium could result in
capital losses.

Adjustable Rate Securities. Adjustable rate securities have interest rates
that are reset at periodic intervals, usually by reference to some interest
rate index or market interest rate. Some adjustable rate securities are
backed by pools of mortgage loans. Although the rate-adjustment feature may
reduce sharp changes in the value of adjustable rate securities, these
securities can change in value based on changes in market interest rates or
the issuer's creditworthiness. Changes in the interest rate on adjustable
rate securities may lag behind changes in prevailing market interest rates.
Also, some adjustable rate securities (or the underlying mortgages) are
subject to caps or floors that limit the maximum change in interest rate.

Asset-Backed Securities. Asset-backed securities (unrelated to first mortgage
loans) represent fractional interests in pools of leases, retail installment
loans, revolving credit receivables and other payment obligations, both
secured and unsecured. These assets are generally held by a trust and
payments of principal and interest or interest only are passed through
monthly or quarterly to certificate holders and may be guaranteed up to
certain amounts by letters of credit issued by a financial institution
affiliated or unaffiliated with the trustee or originator of the trust.

Like mortgages underlying mortgage-backed securities, underlying automobile
sales contracts or credit card receivables are subject to prepayment, which
may reduce the overall return to certificate holders. Certificate holders may
also experience delays in payment on the certificates if the full amounts due
on underlying sales contracts or receivables are not realized by the trust
because of unanticipated legal or administrative costs of enforcing the
contracts or because of depreciation or damage to the collateral (usually
automobiles) securing certain contracts, or other factors.

Zero-Coupon and Payment-in-Kind Bonds. Zero-coupon bonds are issued at a
significant discount from their principal amount in lieu of paying interest
periodically. Payment-in-kind bonds allow the issuer to make current interest
payments on the bonds in additional bonds. Because zero-coupon bonds and
payment-in-kind bonds do not pay current interest in cash, their value is
generally subject to greater fluctuation in response to changes in market
interest rates than bonds that pay interest in cash currently. Both
zero-coupon and payment-in-kind bonds allow an issuer to avoid the need to
generate cash to meet current interest payments. Accordingly, such bonds may
involve greater credit risks than bonds paying interest currently. Even
though such bonds do not pay current interest in cash, a Fund is nonetheless
required to accrue interest income on such investments and to distribute such
amounts at least annually to shareholders. Thus, a Fund could be required at
times to liquidate other investments in order to satisfy its dividend
requirements.

Equity-Linked Debt Securities. Equity-linked debt securities are securities
with respect to which the amount of interest and/or principal that the issuer
thereof is obligated to pay is linked to the performance of a specified index
of equity securities. Such amount may be significantly greater or less than
payment obligations in respect of other types of debt securities. Adverse
changes in equity securities indices and other adverse changes in the
securities markets may reduce payments made under, and/or the principal of,
equity-linked debt securities held by the Fund. Furthermore, as with any debt
securities, the values of equity-linked debt securities will generally vary
inversely with changes in interest rates. The Fund's ability to dispose of
equity-linked debt securities will depend on the availability of liquid
markets for such securities. Investment in equity-linked debt securities may
be considered to be speculative. As with other securities, the Fund could
lose its entire investment in equity-linked debt securities.

Loans and Other Direct Debt Instruments. Loans and other direct debt
instruments are interests in amounts owned by a corporate, governmental or
other borrower to another party. They may represent amounts owed to lenders
or lending syndicates (loans and loan participations), to suppliers of goods
or services (trade claims or other receivables), or to other creditors.
Direct debt instruments involve the risk of loss in case of default or
insolvency of the borrower and may offer less legal protection to the Fund in
the event of fraud or misrepresentation than debt securities. In addition,
loan participations involve a risk of insolvency of the lending bank or other
financial intermediary. Direct debt instruments may also include standby
financing commitments that obligate the Fund to supply additional cash to the
borrower on demand. Loans and other direct debt instruments are generally
illiquid and may be transferred only through individually negotiated private
transactions.

Purchasers of loans and other forms of direct indebtedness depend primarily upon
the creditworthiness of the borrower for payment of principal and interest.
Direct debt instruments may not be rated by any nationally recognized rating
service. If the Fund does not receive scheduled interest or principal payments
on such indebtedness, the Fund's share price and yield could

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be adversely affected. Loans that are fully secured offer the Fund more
protection than unsecured loans in the event of non-payment of scheduled
interest or principal. However, there is no assurance that the liquidation of
collateral from a secured loan would satisfy the borrower's obligation, or
that the collateral can be liquidated. Indebtedness of borrowers whose
creditworthiness is poor may involve substantial risks, and may be highly
speculative.

Borrowers that are in bankruptcy or restructuring may never pay off their
indebtedness, or may pay only a small fraction of the amount owed. Direct
indebtedness of Asian countries will also involve a risk that the
governmental entities responsible for the repayment of the debt may be
unable, or unwilling, to pay interest and repay principal when due.

Investments in loans through direct assignment of a financial institution's
interests with respect to a loan may involve additional risks to the Fund.
For example, if a loan is foreclosed, the Fund could become part owner of any
collateral, and would bear the costs and liabilities associated with owning
and disposing of the collateral. Direct debt instruments may also involve a
risk of insolvency of the lending bank or other intermediary.

A loan is often administered by a bank or other financial institution that
acts as agent for all holders. The agent administers the terms of the loan,
as specified on the loan agreement. Unless, under the terms of the loan or
other indebtedness, the Fund has direct recourse against the borrower, it may
have to rely on the agent to apply appropriate credit remedies against a
borrower. If assets held by the agent for the benefit of the Fund were
determined to be subject to the claims of the agent's general creditors, the
Fund might incur certain costs and delays in realizing payment on the loan or
loan participation and could suffer a loss of principal or interest.

Direct indebtedness purchased by the Fund may include letters of credit,
revolving credit facilities, or other standby financing commitments
obligating the Fund to pay additional cash on demand. These commitments may
have the effect of requiring the Fund to increase its investment in a
borrower at a time when it would not otherwise have done so, even if the
borrower's condition makes it unlikely that the amount will ever by repaid.
The Fund will set aside appropriate liquid assets in a segregated custodial
account to cover its potential obligations under standby financing commitments.

Illiquid Securities. Subject to any more restrictive applicable fundamental
investment policy, none of the Funds will maintain more than 15% of its net
assets in illiquid securities. Illiquid securities generally include (i)
direct placements or other securities that are subject to legal or contractual
restrictions on resale or for which there is no readily available market
(e.g., when trading in the security is suspended or, in the case of unlisted
securities, when market makers do not exist or will not entertain bids or
offers), including many individually negotiated currency swaps and any assets
used to cover currency swaps and most privately negotiated investments in
state enterprises that have not yet conducted an initial equity offering,
(ii) over-the-counter options and assets used to cover over-the-counter
options, and (iii) repurchase agreements not terminable within seven days.

Because of the absence of a trading market for illiquid securities, a Fund
may not be able to realize their full value upon sale. With respect to each
Fund that may invest in such securities, Alliance will monitor their
illiquidity under the supervision of the Directors of the Fund. To the extent
permitted by applicable law, Rule 144A securities will not be treated as
"illiquid" for purposes of the foregoing restriction so long as such
securities meet liquidity guidelines established by a Fund's Directors.
Investment in non-publicly traded securities by each of Growth Fund and
Strategic Balanced Fund is restricted to 5% of its total assets (not including
for these purposes Rule 144A securities, to the extent permitted by applicable
law) and is also subject to the 15% restriction on investment in illiquid
securities described above.

A Fund that invests in securities for which there is no ready market may
therefore not be able to readily sell such securities. To the extent that
these securities are foreign securities, there is no law in many of the
countries in which a Fund may invest similar to the Securities Act requiring
an issuer to register the sale of securities with a governmental agency or
imposing legal restrictions on resales of securities, either as to length of
time the securities may be held or manner of resale. However, there may be
contractual restrictions on resale of securities.

Options. An option gives the purchaser of the option, upon payment of a
premium, the right to deliver to (in the case of a put) or receive from (in
the case of a call) the writer a specified amount of a security on or before
a fixed date at a predetermined price. A call option written by a Fund is
"covered" if the Fund owns the underlying security, has an absolute and
immediate right to acquire that security upon conversion or exchange of
another security it holds, or holds a call option on the underlying security
with an exercise price equal to or less than that of the call option it has
written. A put option written by a Fund is covered if the Fund holds a put
option on the underlying securities with an exercise price equal to or
greater than that of the put option it has written.

A call option is for cross-hedging purposes if a Fund does not own the
underlying security, and is designed to provide a hedge against a decline in
value in another security which the Fund owns or has the right to acquire.
Worldwide Privatization Fund, All-Asia Fund, Income Builder Fund and Utility
Income Fund each may write call options for cross-hedging purposes. A Fund
would write a call option for cross-hedging purposes, instead of
writing a covered call option, when the premium to be received from the
cross-hedge transaction would exceed that which would be received from
writing a covered call option, while at the same time achieving the desired
hedge. In such circumstances, the Fund collateralizes its obligation under
the option by maintaining segregated account assets in an amount not less
than the market value of the underlying security, marked to market daily.

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In purchasing a call option, a Fund would be in a position to realize a gain
if, during the option period, the price of the underlying security increased
(in the case of a call) or decreased (in the case of a put) by an amount in
excess of the premium paid; otherwise the Fund would experience a loss equal
to the premium paid for the option.

If an option written by a Fund were exercised, the Fund would be obligated to
purchase (in the case of a put) or sell (in the case of a call) the
underlying security at the exercise price. The risk involved in writing an
option is that, if the option were exercised, the underlying security would
then be purchased or sold by the Fund at a disadvantageous price. These risks
could be reduced by entering into a closing transaction (i.e., by disposing
of the option prior to its exercise). A Fund retains the premium received
from writing a put or call option whether or not the option is exercised. The
writing of covered call options could result in increases in a Fund's
portfolio turnover rate, especially during periods when market prices of the
underlying securities appreciate.

Technology Fund, Quasar Fund, International Fund, New Europe Fund and Global
Small Cap Fund will not write uncovered call options. Technology Fund and
Global Small Cap Fund will not write a call option if the premium to be received
by the Fund in doing so would not produce an annualized return of at least 15%
of the then current market value of the securities subject to the option
(without giving effect to commissions, stock transfer taxes and other expenses
that are deducted from premium receipts). Technology Fund, Quasar Fund and
Global Small Cap Fund will not write a call option if, as a result, the
aggregate of the Fund's portfolio securities subject to outstanding call options
(valued at the lower of the option price or market value of such securities)
would exceed 15% of the Fund's total assets or more than 10% of the Fund's
assets would be committed to call options that at the time of sale have a
remaining term of more than 100 days. The aggregate cost of all outstanding
options purchased and held by each of Premier Growth Fund, Technology Fund,
Quasar Fund and Global Small Cap Fund will at no time exceed 10% of the Fund's
total assets. Neither International Fund nor New Europe Fund will write
uncovered put options.

A Fund that purchases or writes options on securities in privately negotiated
(i.e., over-the-counter) transactions will effect such transactions only with
investment dealers and other financial institutions (such as commercial banks
or savings and loan institutions) deemed creditworthy by Alliance, and
Alliance has adopted procedures for monitoring the creditworthiness of such
entities. Options purchased or written by a Fund in negotiated transactions
are illiquid and it may not be possible for the Fund to effect a closing
transaction at an advantageous time. See "Illiquid Securities."

Options on Securities Indices. An option on a securities index is similar to
an option on a security except that, rather than the right to take or make
delivery of a security at a specified price, an option on a securities index
gives the holder the right to receive, upon exercise of the option, an amount
of cash if the closing level of the chosen index is greater than (in the case
of a call) or less than (in the case of a put) the exercise price of the option.

Futures Contracts and Options on Futures Contracts. A "sale" of a futures
contract means the acquisition of a contractual obligation to deliver the
securities or foreign currencies or other commodity called for by the
contract at a specified price on a specified date. A "purchase" of a futures
contract means the incurring of an obligation to acquire the securities,
foreign currencies or other commodity called for by the contract at a
specified price on a specified date. The purchaser of a futures contract on
an index agrees to take or make delivery of an amount of cash equal to the
difference between a specified dollar multiple of the value of the index on
the expiration date of the contract ("current contract value") and the price
at which the contract was originally struck. No physical delivery of the
securities underlying the index is made.

Options on futures contracts written or purchased by a Fund will be traded on
U.S. or foreign exchanges or over-the-counter. These investment techniques
will be used only to hedge against anticipated future changes in market
conditions and interest or exchange rates which otherwise might either
adversely affect the value of the Fund's portfolio securities or adversely
affect the prices of securities which the Fund intends to purchase at a later
date.

No Fund will enter into any futures contracts or options on futures contracts
if immediately thereafter the market values of the outstanding futures
contracts of the Fund and the currencies and futures contracts subject to
outstanding options written by the Fund would exceed 50% of its total assets
and Income Builder Fund will also not do so if immediately thereafter the
aggregate of initial margin deposits on all the outstanding futures contracts
of the Fund and premiums paid on outstanding options on futures contracts
would exceed 5% of the market value of the total assets of the Fund. Neither
Premier Growth Fund nor Counterpoint Fund may purchase or sell a stock index
future if immediately thereafter more than 30% of its total assets would be
hedged by stock index futures. In connection with the purchase of stock index
futures contracts, a Fund will deposit in a segregated account with its
custodian an amount of cash, U.S. Government securities or other liquid
high-quality debt securities equal to the market value of the futures
contracts less any amounts maintained in a margin account with the Fund's
broker. Premier Growth Fund and Counterpoint Fund may not purchase or sell a
stock index future if, immediately thereafter, the sum of the amount of
margin deposits on the Fund's existing futures positions would exceed 5% of
the market value of the Fund's total assets.

Options on Foreign Currencies. As in the case of other kinds of options, the
writing of an option on a foreign currency constitutes only a partial hedge,
up to the amount of the premium received, and a Fund could be required to
purchase or

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sell foreign currencies at disadvantageous exchange rates, thereby incurring
losses. The purchase of an option on a foreign currency may constitute an
effective hedge against fluctuations in exchange rates although, in the event
of rate movements adverse to a Fund's position, it may forfeit the entire
amount of the premium plus related transaction costs. See the Statement of
Additional Information of each Fund that may invest in options on foreign
currencies for further discussion of the use, risks and costs of options on
foreign currencies.

Forward Foreign Currency Exchange Contracts. A Fund purchases or sells
forward contracts to minimize the risk to it from adverse changes in the
relationship between the U.S. dollar and other currencies. A forward contract
is an obligation to purchase or sell a specific currency for an agreed price
at a future date, and is individually negotiated and privately traded.

A Fund may enter into a forward contract, for example, when it enters into a
contract for the purchase or sale of a security denominated in a foreign
currency in order to "lock in" the U.S. dollar price of the security
("transaction hedge"). A Fund will not engage in transaction hedges with
respect to the currency of a particular country to an extent greater than the
aggregate amount of the Fund's transactions in that currency. When a Fund
believes that a foreign currency may suffer a substantial decline against the
U.S. dollar, it may enter into a forward sale contract to sell an amount of
that foreign currency approximating the value of some or all of the Fund's
portfolio securities denominated in such foreign currency, or when the Fund
believes that the U.S. dollar may suffer a substantial decline against a
foreign currency, it may enter into a forward purchase contract to buy that
foreign currency for a fixed dollar amount ("position hedge"). A Fund will
not position hedge with respect to the currency of a particular country to an
extent greater than the aggregate market value (at the time of making such
sale) of the securities held in its portfolio denominated or quoted in that
particular foreign currency. Instead of entering into a position hedge, a
Fund may, in the alternative, enter into a forward contract to sell a
different foreign currency for a fixed U.S. dollar amount where the Fund
believes that the U.S. dollar value of the currency to be sold pursuant to
the forward contract will fall whenever there is a decline in the U.S. dollar
value of the currency in which portfolio securities of the Fund are
denominated ("cross-hedge"). To the extent required by applicable law, each
Fund's custodian will place cash not available for investment, U.S.
Government securities or other liquid high-grade debt securities in a
segregated account of the Fund having a value equal to the aggregate amount
of the Fund's commitments under forward contracts entered into with respect
to transaction and position hedges and cross-hedges. If the value of the
securities placed in a segregated account declines, additional cash or
securities will be placed in the account on a daily basis so that the value
of the account will equal the amount of the Fund's commitments with respect
to such contracts. As an alternative to maintaining all or part of the
segregated account, a Fund may purchase a call option permitting the Fund to
purchase the amount of foreign currency being hedged by a forward sale
contract at a price no higher than the forward contract price or the Fund may
purchase a put option permitting the Fund to sell the amount of foreign
currency subject to a forward purchase contract at a price as high or higher
than the forward contract price. In addition, the Fund may use such other
methods of "cover" as are permitted by applicable law. Unanticipated changes
in currency prices may result in poorer overall performance for the Fund than
if it had not entered into such forward contracts.

Hedging against a decline in the value of a currency does not eliminate
fluctuations in the prices of portfolio securities or prevent losses if the
prices of such securities decline. Such transactions also preclude the
opportunity for gain if the value of the hedged currency should rise.
Moreover, it may not be possible for a Fund to hedge against a devaluation
that is so generally anticipated that the Fund is not able to contract to
sell the currency at a price above the devaluation level it anticipates.
International Fund, New Europe Fund and Global Small Cap Fund will not enter
into a forward contract with a term of more than one year or if, as a result,
more than 50% of its total assets would be committed to such contracts. The
dealings of International Fund, New Europe Fund and Global Small Cap Fund in
forward contracts will be limited to hedging involving either specific
transactions or portfolio positions.

Growth Fund and Strategic Balanced Fund may also purchase and sell foreign
currency on a spot basis.

Forward Commitments. Forward commitments for the purchase or sale of
securities may include purchases on a "when-issued" basis or purchases or
sales on a "delayed delivery" basis. In some cases, a forward commitment may
be conditioned upon the occurrence of a subsequent event, such as approval
and consummation of a merger, corporate reorganization or debt restructuring
(i.e., a "when, as and if issued" trade).

When forward commitment transactions are negotiated, the price is fixed at
the time the commitment is made, but delivery and payment for the securities
take place at a later date. Normally, the settlement date occurs within two
months after the transaction, but settlements beyond two months may be
negotiated. Securities purchased or sold under a forward commitment are
subject to market fluctuation, and no interest or dividends accrue to the
purchaser prior to the settlement date. At the time a Fund intends to enter
into a forward commitment, it records the transaction and thereafter reflects
the value of the security purchased or, if a sale, the proceeds to be
received, in determining its net asset value. Any unrealized appreciation or
depreciation reflected in such valuation of a "when, as and if issued"
security would be canceled in the event that the required conditions did not
occur and the trade was canceled.

The use of forward commitments enables a Fund to protect against anticipated
changes in interest rates and prices. For instance, in periods of rising
interest rates and falling bond prices, a Fund might sell securities in its
portfolio on a forward commitment basis to limit its exposure to falling
prices. In periods of falling interest rates and rising bond prices, a Fund
might sell a security in its portfolio and purchase the same or

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<PAGE>

a similar security on a when-issued or forward commitment basis, thereby
obtaining the benefit of currently higher cash yields. However, if Alliance
were to forecast incorrectly the direction of interest rate movements, a Fund
might be required to complete such when-issued or forward transactions at
prices inferior to the then current market values. When-issued securities and
forward commitments may be sold prior to the settlement date, but a Fund
enters into when-issued and forward commitments only with the intention of
actually receiving securities or delivering them, as the case may be. If a
Fund chooses to dispose of the right to acquire a when-issued security prior
to its acquisition or dispose of its right to deliver or receive against a
forward commitment, it may incur a gain or loss. Any significant commitment
of Fund assets to the purchase of securities on a "when, as and if issued"
basis may increase the volatility of the Fund's net asset value. No forward
commitments will be made by New Europe Fund, All-Asia Fund, Worldwide
Privatization Fund, Income Builder Fund or Utility Income Fund if, as a
result, the Fund's aggregate commitments under such transactions would be
more than 30% of the Fund's total assets. To facilitate these transactions,
each Fund's custodian maintains in a segregated account of the Fund cash
and/or liquid high grade debt securities, denominated in U.S. dollars (or
non-U.S. currencies in the case of New Europe Fund) having a value equal to,
or greater than, any commitments to purchase securities on a forward
commitment basis and, with respect to forward commitments to sell portfolio
securities, the portfolio securities themselves. In the event the other party
to a forward commitment transaction were to default, a Fund might lose the
opportunity to invest money at favorable rates or to dispose of securities at
favorable prices.

Standby Commitment Agreements. Standby commitment agreements commit a Fund,
for a stated period of time, to purchase a stated amount of a security that
may be issued and sold to the Fund at the option of the issuer. The price and
coupon of the security are fixed at the time of the commitment. At the time
of entering into the agreement the Fund is paid a commitment fee, regardless
of whether the security ultimately is issued, typically equal to
approximately 0.5% of the aggregate purchase price of the security the Fund
has committed to purchase. A Fund will enter into such agreements only for
the purpose of investing in the security underlying the commitment at a yield
and price considered advantageous to the Fund and unavailable on a firm
commitment basis. Each Fund, other than Income Builder Fund, will not enter
into a standby commitment with a remaining term in excess of 45 days and will
limit its investment in such commitments so that the aggregate purchase price
of the securities subject to the commitments will not exceed 25% with respect
to New Europe Fund, 50% with respect to Worldwide Privatization Fund and
All-Asia Fund, and 20% with respect to Utility Income Fund, of its assets
taken at the time of making the commitment. Each Fund at all times maintains
a segregated account with its custodian of cash and/or liquid high grade debt
securities, denominated in U.S. dollars (or non-U.S. currencies in the case
of New Europe Fund and Utility Income Fund) in an aggregate amount equal to
the purchase price of the securities underlying the commitment.

There is no guarantee that the securities subject to a standby commitment
will be issued and the value of the security, if issued, on the delivery date
may be more or less than its purchase price. Since the issuance of the
security underlying the commitment is at the option of the issuer, a Fund
will bear the risk of capital loss in the event the value of the security
declines and may not benefit from an appreciation in the value of the
security during the commitment period if the issuer decides not to issue and
sell the security to the Fund.

Currency Swaps. Currency swaps involve the individually negotiated exchange
by a Fund with another party of a series of payments in specified currencies.
A currency swap may involve the delivery at the end of the exchange period of
a substantial amount of one designated currency in exchange for the other
designated currency. Therefore the entire principal value of a currency swap
is subject to the risk that the other party to the swap will default on its
contractual delivery obligations. The net amount of the excess, if any, of a
Fund's obligations over its entitlements with respect to each currency swap
will be accrued on a daily basis and, to the extent required by applicable
law, an amount of cash or high-grade liquid debt securities having an
aggregate value at least equal to the accrued excess will be maintained in a
segregated account by the Fund's custodian. A Fund will not enter into any
currency swap unless the credit quality of the unsecured senior debt or the
claims-paying ability of the other party thereto is rated in the highest
rating category of at least one nationally recognized rating organization at
the time of entering into the transaction. If there is a default by the other
party to such a transaction, such Fund will have contractual remedies pursuant
to the agreements related to the transactions.

Interest Rate Transactions. Each Fund that may enter into interest rate
transactions expects to do so primarily to preserve a return or spread on a
particular investment or portion of its portfolio or to protect against any
increase in the price of securities the Fund anticipates purchasing at a
later date. The Funds do not intend to use these transactions in a
speculative manner.

Interest rate swaps involve the exchange by a Fund with another party of their
respective commitments to pay or receive interest (e.g., an exchange of floating
rate payments for fixed rate payments). Interest rate swaps are entered on a net
basis (i.e., the two payment streams are netted out, with the Fund receiving or
paying, as the case may be, only the net amount of the two payments). With
respect to All-Asia Fund and Utility Income Fund, the exchange commitments can
involve payments in the same currency or in different currencies. The purchase
of an interest rate cap entitles the purchaser, to the extent that a specified
index exceeds a predetermined interest rate, to receive payments of interest on
a contractually-based principal amount from the party selling such interest rate
cap. The purchase of an interest rate floor entitles the purchaser, to the
extent that a

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specified index falls below a predetermined interest rate, to receive
payments of interest on an agreed principal amount from the party selling the
interest rate floor.

A Fund may enter into interest rate swaps, caps and floors on either an
asset-based or liability-based basis, depending upon whether it is hedging
its assets or liabilities. The net amount of the excess, if any, of a Fund's
obligations over its entitlements with respect to each interest rate swap,
cap and floor is accrued daily, and an amount of cash or liquid high-grade
debt securities having an aggregate value at least equal to the accrued
excess is maintained in a segregated account by the Fund's custodian. A Fund
will not enter into an interest rate swap, cap or floor transaction unless
the unsecured senior debt or the claims-paying ability of the other party
thereto is then rated in the highest rating category of at least one
nationally recognized rating organization. Alliance will monitor the
creditworthiness of counterparties on an ongoing basis. The swap market has
grown substantially in recent years, with a large number of banks and
investment banking firms acting both as principals and as agents utilizing
standardized swap documentation. As a result, the swap market has become
relatively liquid. Caps and floors are more recent innovations for which
standardized documentation has not yet been developed and, accordingly, they
are less liquid than swaps. To the extent a Fund sells (i.e., writes) caps
and floors it will maintain segregated account assets having an aggregate
value at least equal to the full amount, accrued daily, of the Fund's
obligations with respect to any caps or floors.

The use of interest rate transactions is a highly specialized activity which
involves investment techniques and risks different from those associated with
ordinary portfolio securities transactions. If Alliance incorrectly
forecasted market values, interest rates and other applicable factors, the
investment performance of a Fund would be adversely affected by the use of
these investment techniques. Moreover, even if Alliance is correct in its
forecasts, there is a risk that the transaction position may correlate
imperfectly with the price of the asset or liability being hedged. There is
no limit on the amount of interest rate transactions that may be entered into
by a Fund that is permitted to enter into such transactions. These
transactions do not involve the delivery of securities or other underlying
assets or principal. Accordingly, the risk of loss with respect to interest
rate transactions is limited to the net amount of interest payments that a
Fund is contractually obligated to make. If the other party to an interest
rate transaction defaults, a Fund's risk of loss consists of the net amount
of interest payments that the Fund contractually is entitled to receive.

Repurchase Agreements. A repurchase agreement arises when a buyer purchases a
security and simultaneously agrees to resell it to the vendor at an
agreed-upon future date, normally a day or a few days later. The resale price
is greater than the purchase price, reflecting an agreed-upon interest rate
for the period the buyer's money is invested in the security. Such agreements
permit a Fund to keep all of its assets at work while retaining "overnight"
flexibility in pursuit of investments of a longer-term nature. A Fund requires
continual maintenance by its custodian of collateral in an amount equal to,
or in excess of, the resale price. If a vendor defaults on its repurchase
obligation, a Fund would suffer a loss to the extent that the proceeds from
the sale of the collateral were less than the repurchase price. If a vendor
goes bankrupt, a Fund might be delayed in, or prevented from, selling the
collateral for its benefit. Alliance monitors the creditworthiness of the
vendors with which the Fund enters into repurchase agreements. There is no
percentage restriction on a Fund's ability to enter into repurchase
agreements, other than as indicated under "Investment Objectives and Policies."

Short Sales. A short sale is effected by selling a security that a Fund does
not own, or if the Fund does own such security, it is not to be delivered
upon consummation of the sale. A short sale is "against the box" to the
extent that a Fund contemporaneously owns or has the right to obtain
securities identical to those sold short without payment. Worldwide
Privatization Fund, All-Asia Fund, Income Builder Fund and Utility Income
Fund each may make short sales of securities or maintain short positions only
for the purpose of deferring realization of gain or loss for U.S. federal
income tax purposes, provided that at all times when a short position is open
the Fund owns an equal amount of securities of the same issue as, and equal
in amount to, the securities sold short. In addition, each of those Funds may
not make a short sale if as a result more than 10% of the Fund's net assets
would be held as collateral for short sales, except that All-Asia Fund may
not make a short sale if as a result more than 25% of the Fund's net assets
would be held as collateral for short sales. If the price of the security
sold short increases between the time of the short sale and the time a Fund
replaces the borrowed security, the Fund will incur a loss; conversely, if
the price declines, the Fund will realize a capital gain. See "Certain
Fundamental Investment Policies." Certain special federal income tax
considerations may apply to short sales entered into by a Fund. See
"Dividends, Distributions and Taxes" in the relevant Fund's Statement of
Additional Information.

Loans of Portfolio Securities. The risks in lending portfolio securities, as
with other extensions of credit, consist of possible loss of rights in the
collateral should the borrower fail financially. In determining whether to lend
securities to a particular borrower, Alliance will consider all relevant facts
and circumstances, including the creditworthiness of the borrower. While
securities are on loan, the borrower will pay the Fund any income earned thereon
and the Fund may invest any cash collateral in portfolio securities, thereby
earning additional income, or receive an agreed upon amount of income from a
borrower who has delivered equivalent collateral. Each Fund will have the right
to regain record ownership of loaned securities to exercise beneficial rights
such as voting rights, subscription rights and rights to dividends, interest or

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distributions. A Fund may pay reasonable finders', administrative and
custodial fees in connection with a loan. A Fund will not lend its portfolio
securities to any officer, director, employee or affiliate of the Fund or
Alliance.

General. The successful use of the foregoing investment practices draws upon
Alliance's special skills and experience with respect to such instruments and
usually depends on Alliance's ability to forecast price movements, interest
rates or currency exchange rate movements correctly. Should interest rates,
prices or exchange rates move unexpectedly, a Fund may not achieve the
anticipated benefits of the transactions or may realize losses and thus be in
a worse position than if such strategies had not been used. Unlike many
exchange-traded futures contracts and options on futures contracts, there are
no daily price fluctuation limits with respect to certain options and forward
contracts, and adverse market movements could therefore continue to an
unlimited extent over a period of time. In addition, the correlation between
movements in the prices of futures contracts, options and forward contracts
and movements in the prices of the securities and currencies hedged or used
for cover will not be perfect and could produce unanticipated losses.

A Fund's ability to dispose of its position in futures contracts, options and
forward contracts depends on the availability of liquid markets in such
instruments. Markets in options and futures with respect to a number of types
of securities and currencies are relatively new and still developing, and
there is no public market for forward contracts. It is impossible to predict
the amount of trading interest that may exist in various types of futures
contracts, options and forward contracts. If a secondary market does not
exist with respect to an option purchased or written by a Fund, it might not
be possible to effect a closing transaction in the option (i.e., dispose of
the option) with the result that (i) an option purchased by the Fund would
have to be exercised in order for the Fund to realize any profit and (ii) the
Fund may not be able to sell currencies or portfolio securities covering an
option written by the Fund until the option expires or it delivers the
underlying security, futures contract or currency upon exercise. Therefore,
no assurance can be given that the Funds will be able to utilize these
instruments effectively for the purposes set forth above. Furthermore, a
Fund's ability to engage in options and futures transactions may be limited
by tax considerations. See "Dividends, Distributions and Taxes" in the
Statement of Additional Information of each Fund that invests in options and
futures.

Future Developments. A Fund may, following written notice to its
shareholders, take advantage of other investment practices that are not
currently contemplated for use by the Fund or are not available but may yet
be developed, to the extent such investment practices are consistent with the
Fund's investment objective and legally permissible for the Fund. Such
investment practices, if they arise, may involve risks that exceed those
involved in the activities described above.

Defensive Position. For temporary defensive purposes, each Fund may invest in
certain types of short-term, liquid, high-grade or high quality (depending on
the Fund) debt securities. These securities may include U.S. Government
securities, qualifying bank deposits, money market instruments, prime
commercial paper and other types of short-term debt securities including
notes and bonds. For Funds that may invest in foreign countries, such
securities may also include short-term, foreign-currency denominated
securities of the type mentioned above issued by foreign governmental
entities, companies and supranational organizations. For a complete
description of the types of securities each Fund may invest in while in a
temporary defensive position, please see such Fund's Statement of Additional
Information.

Portfolio Turnover. A 100%, 150%, 200% and 300% annual turnover rate would
occur, for example, when all of the securities in a Fund's portfolio are
replaced once, one and one-half times, twice and three times, respectively,
in a period of one year. A 100% portfolio turnover rate is greater than that
of most other investment companies, including those which emphasize capital
appreciation as a basic policy. A high rate of portfolio turnover involves
correspondingly greater brokerage and other expenses than a lower rate, which
must be borne by the Fund and its shareholders. High portfolio turnover also
may result in the realization of substantial net short-term capital gains.
See "Dividends, Distributions and Taxes" in each Fund's Statement of
Additional Information.

CERTAIN FUNDAMENTAL INVESTMENT POLICIES

Each Fund has adopted certain fundamental investment policies listed below,
which may not be changed without the approval of its shareholders. Additional
investment restrictions with respect to a Fund are set forth in its Statement
of Additional Information.

Alliance Fund may not: (i) invest more than 5% of its total assets in the
securities of any one issuer (other than the U.S. Government); (ii) acquire
more than 10% of the voting or other securities of any one issuer; or (iii)
buy securities of any company that (including its predecessors) has not been in
business at least three continuous years. Pursuant to investment policies
which are not fundamental, the Fund does not invest (i) in puts or calls
(except as discussed above); (ii) in straddles, spreads, or any combination
thereof; (iii) in oil, gas or other mineral exploration or development
programs; or (iv) more than 5% of its gross assets in securities the
disposition of which would be subject to restrictions under the federal
securities laws.

Growth Fund and Strategic Balanced Fund may not: (i) invest more than 5% of its
total assets in the securities of any one issuer (other than U.S. Government
securities and repurchase agreements relating thereto), although up to 25% of
the Fund's total assets may be invested without regard to this restriction;

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or (ii) invest 25% or more of its total assets in the securities of any one
industry.

Premier Growth Fund may not: (i) purchase more than 10% of the outstanding
voting securities of any one issuer; (ii) invest 25% or more of the value of
its total assets in the same industry; (iii) borrow money or issue senior
securities except for temporary or emergency purposes in an amount not
exceeding 5% of the value of its total assets at the time the borrowing is
made; (iv) pledge, mortgage, hypothecate or otherwise encumber any of its
assets except in connection with the writing of call options and except to
secure permitted borrowings; or (v) invest in the securities of any issuer
that has a record of less than three years of continuous operation (including
the operation of any predecessor) if as a result more than 10% of the value
of the total assets of the Fund would be invested in the securities of such
issuer or issuers.

Counterpoint Fund may not: (i) purchase the securities of any one issuer,
other than the U.S. Government or any of its agencies or instrumentalities,
if as a result more than 5% of the value of its total assets would be
invested in such issuer or the Fund would own more than 10% of the
outstanding voting securities of such issuer, except that up to 25% of the
Fund's total assets may be invested without regard to these 5% and 10%
limitations; (ii) invest 25% or more of its total assets in a particular
industry; (iii) borrow money except for temporary or emergency purposes,
including meeting redemption requests which might require the untimely
disposition of securities; borrowing in the aggregate may not exceed 15%, and
borrowing for purposes other than meeting redemptions may not exceed 5% of
its total assets at the time the borrowing is made; (iv) invest more than 10%
of its net assets in the aggregate in restricted and not readily marketable
securities; (v) invest more than 10% of its total assets in the securities of
any issuer that has a record of less than three years of continuous operation
(including the operation of any predecessor); or (vi) invest more than 10% of
the value of its total assets in the aggregate in illiquid securities or
repurchase agreements not terminable within seven days.

Technology Fund may not: (i) with respect to 75% of its total assets, have
such assets represented by other than: (a) cash and cash items, (b) U.S.
Government securities, or (c) securities of any one issuer (other than the
U.S. Government and its agencies or instrumentalities) not greater in value
than 5% of the Fund's total assets, and not more than 10% of the outstanding
voting securities of such issuer; (ii) purchase the securities of any one
issuer, other than the U.S. Government and its agencies or instrumentalities,
if as a result (a) the value of the holdings of the Fund in the securities of
such issuer exceeds 25% of its total assets, or (b) the Fund owns more than
25% of the outstanding securities of any one class of securities of such
issuer; (iii) concentrate its investments in any one industry, but the Fund
has reserved the right to invest up to 25% of its total assets in a
particular industry; and (iv) invest in the securities of any issuer which
has a record of less than three years of continuous operation (including the
operation of any predecessor) if such purchase would cause 10% or more of its
total assets to be invested in the securities of such issuers.

Quasar Fund may not: (i) purchase the securities of any one issuer, other
than the U.S. Government or any of its agencies or instrumentalities, if as a
result more than 5% of its total assets would be invested in such issuer or
the Fund would own more than 10% of the outstanding voting securities of such
issuer, except that up to 25% of its total assets may be invested without
regard to these 5% and 10% limitations; (ii) invest more than 25% of its
total assets in any particular industry; (iii) borrow money except for
temporary or emergency purposes in an amount not exceeding 5% of its total
assets at the time the borrowing is made; or (iv) invest more than 10% of its
assets in restricted securities.

International Fund may not: (i) invest more than 5% of the value of its total
assets in securities of a single issuer (including repurchase agreements with
any one entity), except U.S. Government securities or foreign government
securities; provided, however, that the Fund may not, with respect to 75% of
its total assets, invest more than 5% of its total assets in securities of
any one foreign government issuer; (ii) own more than 10% of the outstanding
securities of any class of any issuer (for this purpose, all preferred stocks
of an issuer shall be deemed a single class, and all indebtedness of an
issuer shall be deemed a single class), except U.S. Government securities;
(iii) invest more than 25% of the value of its total assets in securities of
issuers having their principal business activities in the same industry;
provided, that this limitation does not apply to U.S. Government securities
or foreign government securities; (iv) invest more than 5% of the value of
its total assets in the securities of any issuer that has a record of less
than three years of continuous operation (including the operation of any
predecessor or unconditional guarantor), except U.S. Government securities or
foreign government securities; (v) invest more than 5% of the value of its
total assets in securities with legal or contractual restrictions on resale,
other than repurchase agreements, or more than 10% of the value of its total
assets in securities that are not readily marketable (including restricted
securities and repurchase agreements not terminable within seven business
days); and (vi) borrow money, except as a temporary measure for extraordinary
or emergency purposes, and then only from banks in amounts not exceeding 5%
of its total assets.

Worldwide Privatization Fund may not: (i) invest 25% or more of its total assets
in securities of issuers conducting their principal business activities in the
same industry, except that this restriction does not apply to (a) U.S.
Government securities, or (b) the purchase of securities of issuers whose
primary business activity is in the national commercial banking industry, so
long as the Fund's Directors determine, on the basis of factors such as
liquidity, availability of investments and anticipated returns, that the Fund's
ability to achieve its investment objective would be adversely affected if the
Fund were not permitted to invest more than 25% of its total assets

34
<PAGE>

in those securities, and so long as the Fund notifies its shareholders of
any decision by the Directors to permit or cease to permit the Fund to invest
more than 25% of its total assets in those securities, such notice to include
a discussion of any increased investment risks to which the Fund may be
subjected as a result of the Directors' determination; (ii) borrow money
except from banks for temporary or emergency purposes, including the meeting
of redemption requests that might require the untimely disposition of
securities; borrowing in the aggregate may not exceed 15%, and borrowing for
purposes other than meeting redemptions may not exceed 5%, of the Fund's
total assets (including the amount borrowed) less liabilities (not including
the amount borrowed) at the time the borrowing is made; outstanding
borrowings in excess of 5% of the value of the Fund's total assets will be
repaid before any investments are made; or (iii) pledge, hypothecate,
mortgage or otherwise encumber its assets, except to secure permitted
borrowings. The exception contained in clause (i)(b) above is subject to the
operating policy regarding concentration described in this Prospectus.

New Europe Fund may not: (i) purchase more than 10% of the outstanding voting
securities of any one issuer; (ii) invest more than 15% of its total assets
in the securities of any one issuer or 25% or more of its total assets in the
same industry, provided, however, that the foregoing restriction shall not be
deemed to prohibit the Fund from purchasing the securities of any issuer
pursuant to the exercise of rights distributed to the Fund by the issuer,
except that no such purchase may be made if as a result the Fund will fail to
meet the diversification requirements of the Code and any such acquisition in
excess of the foregoing 15% or 25% limits will be sold by the Fund as soon as
reasonably practicable (this restriction does not apply to U.S. Government
securities, but will apply to foreign government securities unless the
Commission permits their exclusion); (iii) borrow money except from banks for
temporary or emergency purposes, including the meeting of redemption requests
that might require the untimely disposition of securities; borrowing in the
aggregate may not exceed 15%, and borrowing for purposes other than meeting
redemptions may not exceed 5%, of the Fund's total assets (including the
amount borrowed) less liabilities (not including the amount borrowed) at the
time the borrowing is made; outstanding borrowings in excess of 5% of the
Fund's total assets will be repaid before any subsequent investments are
made; or (iv) purchase a security (unless the security is acquired pursuant
to a plan of reorganization or an offer of exchange) if, as a result, the
Fund would own any securities of an open-end investment company or more than
3% of the total outstanding voting stock of any closed-end investment
company, or more than 5% of the value of the Fund's total assets would be
invested in securities of any closed-end investment company, or more than 10%
of such value in closed-end investment companies in general.

All-Asia Fund may not: (i) invest 25% or more of its total assets in
securities of issuers conducting their principal business activities in the
same industry; (ii) borrow money except from banks for temporary or emergency
purposes, including the meeting of redemption requests that might require the
untimely disposition of securities; borrowing in the aggregate may not exceed
15%, and borrowing for purposes other than meeting redemptions may not exceed
5%, of the Fund's total assets (including the amount borrowed) less
liabilities (not including the amount borrowed) at the time the borrowing is
made; outstanding borrowings in excess of 5% of the value of the Fund's total
assets will be repaid before any investments are made; or (iii) pledge,
hypothecate, mortgage or otherwise encumber its assets, except to secure
permitted borrowings.

Global Small Cap Fund may not: (i) purchase the securities of any one issuer,
other than the U.S. Government or any of its agencies or instrumentalities,
if immediately after such purchase more than 5% of the value of its total
assets would be invested in such issuer or the Fund would own more than 10%
of the outstanding voting securities of such issuer, except that up to 25% of
the Fund's total assets may be invested without regard to these 5% and 10%
limitations; (ii) invest 25% or more of its total assets in the same
industry; this restriction does not apply to U.S. Government securities, but
will apply to foreign government securities unless the Commission permits
their exclusion; (iii) borrow money except from banks for emergency or
temporary purposes in an amount not exceeding 5% of the total assets of the
Fund; or (iv) make short sales of securities or maintain a short position,
unless at all times when a short position is open it owns an equal amount of
such securities or securities convertible into or exchangeable for, without
payment of any further consideration, securities of the same issue as, and
equal in amount to, the securities sold short and unless not more than 5% of
the Fund's net assets is held as collateral for such sales at any one time.

Balanced Shares may not: (i) invest more than 5% of its total assets in the
securities of any one issuer, except U.S. Government securities; or (ii) own
more than 10% of the outstanding voting securities of any one issuer.

Income Builder Fund may not: (i) invest 25% or more of its total assets in
securities of companies engaged principally in any one industry, except that
this restriction does not apply to U.S. Government securities; (ii) borrow
money except from banks for temporary or emergency purposes, including the
meeting of redemption requests that might require the untimely disposition of
securities; borrowing in the aggregate may not exceed 15%, and borrowing for
purposes other than meeting redemptions may not exceed 5%, of the Fund's
total assets (including the amount borrowed) less liabilities (not including
the amount borrowed) at the time borrowing is made; securities will not be
purchased while borrowings in excess of 5% of the Fund's total assets are
outstanding; or (iii) pledge, hypothecate, mortgage or otherwise encumber its
assets, except to secure permitted borrowings.

Utility Income Fund may not: (i) invest more than 5% of its total assets in
the securities of any one issuer except the U.S. Government, although with
respect to 25% of its total assets it

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<PAGE>

may invest in any number of issuers; (ii) invest 25% or more of its total
assets in the securities of issuers conducting their principal business
activities in any one industry, other than the utilities industry, except
that this restriction does not apply to U.S. Government securities; (iii)
purchase more than 10% of any class of the voting securities of any one issuer;
(iv) borrow money except from banks for temporary or emergency purposes,
including the meeting of redemption requests that might require the untimely
disposition of securities; borrowing in the aggregate may not exceed 15%, and
borrowing for purposes other than meeting redemptions may not exceed 5%, of
the Fund's total assets (including the amount borrowed) less liabilities (not
including the amount borrowed) at the time the borrowing is made; outstanding
borrowings in excess of 5% of the Fund's total assets will be repaid before
any subsequent investments are made; or (v) purchase a security if, as a
result (unless the security is acquired pursuant to a plan of reorganization
or an offer of exchange), the Fund would own any securities of an open-end
investment company or more than 3% of the total outstanding voting stock of
any closed-end investment company or more than 5% of the value of the Fund's
net assets would be invested in securities of any one or more closed-end
investment companies.

Growth and Income Fund may not (i) invest more than 5% of its net assets in
the security of any one issuer, except U.S. Government obligations or (ii)
own more than 10% of the outstanding voting securities of any issuer.

RISK CONSIDERATIONS

Investment in certain of the Funds involves the special risk considerations
described below. These risks may be heightened when investing in emerging
markets.

Investment in Privatized Enterprises by Worldwide Privatization Fund. In
certain jurisdictions, the ability of foreign entities, such as the Fund, to
participate in privatizations may be limited by local law, or the price or
terms on which the Fund may be able to participate may be less advantageous
than for local investors. Moreover, there can be no assurance that
governments that have embarked on privatization programs will continue to
divest their ownership of state enterprises, that proposed privatizations
will be successful or that governments will not re-nationalize enterprises
that have been privatized. Furthermore, in the case of certain of the
enterprises in which the Fund may invest, large blocks of the stock of those
enterprises may be held by a small group of stockholders, even after the
initial equity offerings by those enterprises. The sale of some portion or
all of those blocks could have an adverse effect on the price of the stock of
any such enterprise.

Most state enterprises or former state enterprises go through an internal
reorganization of management prior to conducting an initial equity offering
in an attempt to better enable these enterprises to compete in the private
sector. However, certain reorganizations could result in a management team
that does not function as well as the enterprise's prior management and may
have a negative effect on such enterprise. After making an initial equity
offering, enterprises that may have enjoyed preferential treatment from the
respective state or government that owned or controlled them may no longer
receive such preferential treatment and may become subject to market
competition from which they were previously protected. Some of these
enterprises may not be able to effectively operate in a competitive market
and may suffer losses or experience bankruptcy due to such competition. In
addition, the privatization of an enterprise by its government may occur over
a number of years, with the government continuing to hold a controlling
position in the enterprise even after the initial equity offering for the
enterprise.

Currency Considerations. Substantially all of the assets of International
Fund, New Europe Fund, All-Asia Fund, Global Small Cap Fund and Worldwide
Privatization Fund will be invested in securities denominated in foreign
currencies, and a corresponding portion of these Funds' revenues will be
received in such currencies. Therefore, the dollar equivalent of their net
assets, distributions and income will be adversely affected by reductions in
the value of certain foreign currencies relative to the U.S. dollar. If the
value of the foreign currencies in which a Fund receives its income falls
relative to the U.S. dollar between receipt of the income and the making of
Fund distributions, the Fund may be required to liquidate securities in order
to make distributions if it has insufficient cash in U.S. dollars to meet
distribution requirements that the Fund must satisfy to qualify as a
regulated investment company for federal income tax purposes. Similarly, if
an exchange rate declines between the time a Fund incurs expenses in U.S.
dollars and the time cash expenses are paid, the amount of the currency
required to be converted into U.S. dollars in order to pay expenses in U.S.
dollars could be greater than the equivalent amount of such expenses in the
currency at the time they were incurred. In light of these risks, a Fund may
engage in certain currency hedging transactions, which themselves involve
certain special risks. See "Additional Investment Practices" above.

Foreign Investment. The securities markets of many foreign countries are
relatively small, with the majority of market capitalization and trading
volume concentrated in a limited number of companies representing a small
number of industries. Consequently, a Fund whose investment portfolio
includes such securities may experience greater price volatility and
significantly lower liquidity than a portfolio invested solely in equity
securities of United States companies. These markets may be subject to
greater influence by adverse events generally affecting the market, and by
large investors trading significant blocks of securities, than is usual in
the United States. Securities settlements may in some instances be subject
to delays and related administrative uncertainties. These problems are
particularly severe in India, where settlement is through physical delivery,
and, where, currently, a severe shortage of vault capacity exists among
custodial banks, although efforts are

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<PAGE>

being undertaken to alleviate the shortage. Certain foreign countries require
governmental approval prior to investments by foreign persons or limit
investment by foreign persons to only a specified percentage of an issuer's
outstanding securities or a specific class of securities which may have less
advantageous terms (including price) than securities of the company available
for purchase by nationals. These restrictions or controls may at times limit
or preclude investment in certain securities and may increase the costs and
expenses of a Fund. In addition, the repatriation of investment income,
capital or the proceeds of sales of securities from certain of the countries
is controlled under regulations, including in some cases the need for certain
advance government notification or authority, and if a deterioration occurs
in a country's balance of payments, the country could impose temporary
restrictions on foreign capital remittances.

A Fund could be adversely affected by delays in, or a refusal to grant, any
required governmental approval for repatriation, as well as by the application
to it of other restrictions on investment. Investing in local markets may
require a Fund to adopt special procedures, which may involve additional costs
to a Fund. The liquidity of a Fund's investments in any country in which any of
these factors exists could be affected and Alliance will monitor the effect of
any such factor or factors on a Fund's investments. Furthermore, transaction
costs including brokerage commissions for transactions both on and off the
securities exchanges in many foreign countries are generally higher than in
the U.S.

Issuers of securities in foreign jurisdictions are generally not subject to
the same degree of regulation as are U.S. issuers with respect to such
matters as insider trading rules, restrictions on market manipulation,
shareholder proxy requirements and timely disclosure of information. The
reporting, accounting and auditing standards of foreign countries may differ,
in some cases significantly, from U.S. standards in important respects and
less information may be available to investors in foreign securities than to
investors in U.S. securities. Substantially less information is publicly
available about certain non-U.S. issuers than is available about U.S. issuers.

The economies of individual foreign countries may differ favorably or
unfavorably from the U.S. economy in such respects as growth of gross
domestic product or gross national product, rate of inflation, capital
reinvestment, resource self-sufficiency and balance of payments position.
Nationalization, expropriation or confiscatory taxation, currency blockage,
political changes, government regulation, political or social instability or
diplomatic developments could affect adversely the economy of a foreign
country or the Fund's investments in such country. In the event of
expropriation, nationalization or other confiscation, a Fund could lose its
entire investment in the country involved. In addition, laws in foreign
countries governing business organizations, bankruptcy and insolvency may
provide less protection to security holders such as the Fund than that
provided by U.S. laws.

Investment in United Kingdom Issuers by New Europe Fund. Investment in
securities of United Kingdom issuers involves certain considerations not
present with investment in securities of U.S. issuers. As with any investment
not denominated in the U.S. dollar, the U.S. dollar value of the Fund's
investment denominated in the british pound sterling will fluctuate with
pound sterling--dollar exchange rate movements. Since 1972, when the pound
sterling was allowed to float against other currencies, it has generally
depreciated against most major currencies, including the U.S. dollar. From
1988 through 1993, the pound sterling declined at an average annual rate of
approximately 15% against the U.S. dollar. Between September and December
1992, after the United Kingdom's exit from the Exchange Rate Mechanism of the
European Monetary System, the value of the pound sterling fell by almost 20%
against the U.S. dollar. The pound sterling continued to fall in early 1993,
but recovered due to interest rate cuts throughout Europe and an upturn in
the economy of the United Kingdom.

The United Kingdom's largest stock exchange is the International Stock
Exchange of the United Kingdom and the Republic of Ireland (The London Stock
Exchange), which is the third largest exchange in the world. As measured by
the FT-SE 100 index, the performance of the 100 largest companies in the
United Kingdom reached a record high of 3462.0 on December 29, 1993, up 20%
from the end of 1992. At the end of the second quarter of 1994, the FT-SE 100
was down approximately 16% from its all-time high. As of December 30, 1994,
the FT-SE 100 had risen approximately 5% from the end of the second quarter
of 1994.

The public sector borrowing requirement, a mandated measure of the amount
required to balance the budget, is not expected to be exceeded this fiscal
year. This should have the effect of lowering the requirement for the next
fiscal year. This prospect, coupled with political infighting, has led to the
repeal of the scheduled second stage of a value-added tax ("VAT") on domestic
fuel. This repeal will force the government to generate revenues from other
sources.

Since 1979, the Conservative Party has controlled Parliament. However, in
recent years, this dominance has been called into question. In 1990, due to
an internal challenge for leadership the Conservative Party chose John Major
to replace Margaret Thatcher as Prime Minister. Although Mr. Major generally
has the support of his party, there remains the possibility that he could
face a challenge for leadership of the Conservative Party. Unless the
Conservative Party calls for an earlier election, the next general election
will take place in April 1997. For further information regarding the United
Kingdom, see the Fund's Statement of Additional Information.

Investment in Japanese Issuers by All-Asia Fund and International Fund.
Investment in securities of Japanese issuers involves certain considerations not
present with investment in securities of U.S. issuers. As with any investment
not denominated in the U.S. dollar, the U.S. dollar value of each Fund's
investments denominated in the Japanese yen will fluctuate with yen-dollar
exchange rate movements. The Japanese yen has generally been appreciating
against the U.S. dollar for the past decade and is currently trading at or about
a post-World War II high against the U.S. dollar.

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Japan's largest stock exchange is the Tokyo Stock Exchange, the First Section
of which is reserved for larger, established companies. As measured by the
TOPIX, a capitalization-weighted composite index of all common stocks listed
in the First Section, the performance of the First Section reached a peak in
1989. Thereafter, the TOPIX declined approximately 46% through the beginning
of 1993. In 1993, the TOPIX increased by approximately 9% from the end of
1992, and by the end of the third quarter of 1994 increased by approximately
8% from the end of 1993. Certain valuation measures, such as price-to-book
value and price-to-cash flow ratios, indicate that the Japanese stock market
is near its lowest level in the last twenty years relative to other world
markets. The average price/earnings ratio of Japanese companies, however, are
high in comparison with other major stock markets.

In recent years, Japan has consistently recorded large current account trade
surpluses with the U.S. that have caused difficulties in the relations
between the two countries. On October 1, 1994, the U.S. and Japan reached an
agreement that may lead to more open Japanese markets with respect to trade
in certain goods and services. The two countries failed to agree, however,
with respect to Japanese imports of American automobiles and automotive
parts. In response to this failure, the U.S. has initiated the process of
imposing limited trade sanctions on Japan. It is unlikely that any such
sanctions will be imposed before late 1995, and it is expected that the
continuing friction between the U.S. and Japan with respect to trade issues
will thus continue for the foreseeable future.

Each Fund's investments in Japanese issuers also will be subject to
uncertainty resulting from the instability of recent Japanese ruling
coalitions. From 1955 to 1993, Japan's government was controlled by a single
political party. In August 1993, following a split in that party, a coalition
government was formed. That coalition government collapsed in April 1994, and
was replaced by a minority coalition that, in turn, collapsed in June 1994.
The stability of the current ruling coalition, the third since 1993, and the
first in 47 years led by a socialist, is not assured. For further information
regarding Japan, see each Fund's Statement of Additional Information.

Investment in Smaller, Emerging Companies. The Funds may invest in smaller,
emerging companies. Global Small Cap Fund and New Europe Fund will emphasize
investment in, and All-Asia Fund may emphasize investment in, smaller,
emerging companies. Investment in such companies involves greater risks than
is customarily associated with securities of more established companies. The
securities of smaller companies may have relatively limited marketability and
may be subject to more abrupt or erratic market movements than securities of
larger companies or broad market indices.

U.S. and Foreign Taxes. Foreign taxes paid by a Fund may be creditable or
deductible by U.S. shareholders for U.S. income tax purposes. No assurance
can be given that applicable tax laws and interpretations will not change in
the future. Moreover, non-U.S. investors may not be able to credit or deduct
such foreign taxes. Investors should review carefully the information
discussed under the heading "Dividends, Distributions and Taxes" and should
discuss with their tax advisers the specific tax consequences of investing in
a Fund.

Fixed-Income Securities. The value of each Fund's shares will fluctuate with
the value of its investments. The value of each Fund's investments in
fixed-income securities will change as the general level of interest rates
fluctuates. During periods of falling interest rates, the values of
fixed-income securities generally rise. Conversely, during periods of rising
interest rates, the values of fixed-income securities generally decline.

Under normal market conditions, the average dollar-weighted maturity of a
Fund's portfolio of debt or other fixed-income securities is expected to vary
between five and 30 years in the case of All-Asia Fund, between eight and 15
years in the case of Income Builder Fund, between five and 25 years in the
case of Utility Income Fund and between one year or less and 30 years in the
case of all other Funds that invest in such securities.

Securities Ratings. The ratings of securities by S&P, Moody's, Duff & Phelps
and Fitch are a generally accepted barometer of credit risk. They are,
however, subject to certain limitations from an investor's standpoint. The
rating of an issuer is heavily weighted by past developments and does not
necessarily reflect probable future conditions. There is frequently a lag
between the time a rating is assigned and the time it is updated. In
addition, there may be varying degrees of difference in credit risk of
securities within each rating category.

Securities rated Aaa by Moody's and AAA by S&P, Duff & Phelps and Fitch are
considered to be of the highest quality; capacity to pay interest and repay
principal is extremely strong. Securities rated Aa by Moody's and AA by S&P,
Duff & Phelps and Fitch are considered to be high quality; capacity to repay
principal is considered very strong, although elements may exist that make
risks appear somewhat larger than exist with securities rated Aaa or AAA.
Securities rated A are considered by Moody's to possess adequate factors
giving security to principal and interest. S&P, Duff & Phelps and Fitch
consider such securities to have a strong capacity to pay interest and repay
principal. Such securities are more susceptible to adverse changes in
economic conditions and circumstances than higher-rated securities.

Securities rated Baa by Moody's and BBB by S&P, Duff & Phelps and Fitch are
considered to have an adequate capacity to pay interest and repay principal.
Such securities are considered to have speculative characteristics and share
some of the same characteristics as lower-rated securities. Sustained periods
of deteriorating economic conditions or of rising interest rates are more
likely to lead to a weakening in the issuer's capacity to pay interest and
repay principal than in the case of higher-rated securities.
Securities rated Ba by Moody's and BB by S&P, Duff & Phelps and Fitch are
considered to have speculative characteristics with respect to capacity to
pay interest and repay principal over time; their future cannot be considered
as well-assured. Securities rated B by Moody's, S&P, Duff & Phelps and Fitch
are considered to have highly speculative characteristics with respect to
capacity to pay interest and repay principal. Assurance of interest and
principal

38
<PAGE>

payments or of maintenance of other terms of the contract over any long
period of time may be small.

Securities rated Caa by Moody's and CCC by S&P, Duff & Phelps and Fitch are
of poor standing and there is a present danger with respect to payment of
principal or interest. Securities rated Ca by Moody's and CC by S&P and Fitch
are minimally protected, and default in payment of principal or interest is
probable. Securities rated C by Moody's, S&P and Fitch are in imminent
default in payment of principal or interest and have extremely poor prospects
of ever attaining any real investment standing. Securities rated D by S&P and
Fitch are in default. The issuer of securities rated DD by Duff & Phelps is
under an order of liquidation.

Investment in Lower-Rated Fixed-Income Securities. Lower-rated securities,
i.e., those rated Ba and lower by Moody's or BB and lower by S&P, Duff &
Phelps or Fitch, are subject to greater risk of loss of principal and
interest than higher-rated securities. They are also generally considered to
be subject to greater market risk than higher-rated securities, and the
capacity of issuers of lower-rated securities to pay interest and repay
principal is more likely to weaken than is that of issuers of higher-rated
securities in times of deteriorating economic conditions or rising interest
rates. In addition, lower-rated securities may be more susceptible to real or
perceived adverse economic conditions than investment grade securities,
although the market values of securities rated below investment grade and
comparable unrated securities tend to react less to fluctuations in interest
rate levels than do those of higher-rated securities.

The market for lower-rated securities may be thinner and less active than
that for higher-rated securities, which can adversely affect the prices at
which these securities can be sold. To the extent that there is no
established secondary market for lower-rated securities, a Fund may
experience difficulty in valuing such securities and, in turn, the Fund's
assets. In addition, adverse publicity and investor perceptions about
lower-rated securities, whether or not factual, may tend to impair their
market value and liquidity.

Alliance will try to reduce the risk inherent in investment in lower-rated
securities through credit analysis, diversification and attention to current
developments and trends in interest rates and economic and political
conditions. However, there can be no assurance that losses will not occur.
Since the risk of default is higher for lower-rated securities, Alliance's
research and credit analysis are a correspondingly more important aspect of
its program for managing a Fund's securities than would be the case if a Fund
did not invest in lower-rated securities.

In seeking to achieve a Fund's investment objective, there will be times,
such as during periods of rising interest rates, when depreciation and
realization of capital losses on securities in a Fund's portfolio will be
unavoidable. Moreover, medium- and lower-rated securities and non-rated
securities of comparable quality may be subject to wider fluctuations in
yield and market values than higher-rated securities under certain market
conditions. Such fluctuations after a security is acquired do not affect the
cash income received from that security but are reflected in the net asset
value of a Fund. See the Statement of Additional Information for each Fund
that invests in lower-rated securities for a description of the bond ratings
of Moody's, S&P, Duff & Phelps and Fitch.

Certain lower-rated securities in which Growth Fund, Income Builder Fund and
Utility Income Fund may invest may contain call or buy-back features that
permit the issuers thereof to call or repurchase such securities. Such
securities may present risks based on prepayment expectations. If an issuer
exercises such a provision, a Fund may have to replace the called security
with a lower yielding security, resulting in a decreased rate of return to
the Fund.

Non-Diversified Status. Each of Premier Growth Fund, Worldwide Privatization
Fund, New Europe Fund, All-Asia Fund and Income Builder Fund is a
"non-diversified" investment company, which means the Fund is not limited in
the proportion of its assets that may be invested in the securities of a
single issuer. However, each Fund intends to conduct its operations so as to
qualify to be taxed as a "regulated investment company" for purposes of the
Code, which will relieve the Fund of any liability for federal income tax to
the extent its earnings are distributed to shareholders. See "Dividends,
Distributions and Taxes" in each Fund's Statement of Additional Information.
To so qualify, among other requirements, the Fund will limit its investments
so that, at the close of each quarter of the taxable year, (i) not more than
25% of the Fund's total assets will be invested in the securities of a single
issuer, and (ii) with respect to 50% of its total assets, not more than 5% of
its total assets will be invested in the securities of a single issuer and
the Fund will not own more than 10% of the outstanding voting securities of a
single issuer. A Fund's investments in U.S. Government securities are not
subject to these limitations. Because Premier Growth Fund, Worldwide
Privatization Fund, New Europe Fund, All-Asia Fund and Income Builder Fund is
each a non-diversified investment company, it may invest in a smaller number
of individual issuers than a diversified investment company, and an
investment in such Fund may, under certain circumstances, present greater
risk to an investor than an investment in a diversified investment company.

Foreign government securities are not treated like U.S. Government securities
for purposes of the diversification tests described in the preceding
paragraph, but instead are subject to these tests in the same manner as the
securities of non-governmental issuers.

- --------------------------------------------------------------------------------
Purchase And Sale
- --------------------------------------------------------------------------------
Of Shares
- --------------------------------------------------------------------------------

HOW TO BUY SHARES

You can purchase shares of any of the Funds through broker-dealers, banks or
other financial intermediaries, or directly through Alliance Fund
Distributors ("AFD"), each Fund's principal underwriter. The minimum initial
investment in each Fund is $250. The minimum for subsequent investments in
each Fund is

39
<PAGE>

$50. Investments of $25 or more are allowed under the automatic investment
program of each Fund. Share certificates are issued only upon request. See
the Subscription Application and Statement of Additional Information for more
information.

Each Fund offers three classes of shares, Class A, Class B and Class C.

Class A Shares--Initial Sales Charge Alternative

You can purchase Class A shares at net asset value plus an initial sales
charge, as follows:

<TABLE>
<CAPTION>
Initial Sales Charge
as % of Commission to
Net Amount as % of Dealer/Agent as %
Amount Purchased Invested Offering Price of Offering Price
<S> <C> <C> <C>
- -------------------------------------------------------------------------------------
Less than $100,000 4.44% 4.25% 4.00%
- -------------------------------------------------------------------------------------
$100,000 to
less than $250,000 3.36 3.25 3.00
- -------------------------------------------------------------------------------------
$250,000 to
less than $500,000 2.30 2.25 2.00
- -------------------------------------------------------------------------------------
$500,000 to
less than $1,000,000 1.78 1.75 1.50
- -------------------------------------------------------------------------------------
</TABLE>

On purchases of $1,000,000 or more, you pay no initial sales charge but may
pay a contingent deferred sales charge ("CDSC") equal to 1% of the lesser of
net asset value at the time of redemption or original cost if you redeem
within one year; Alliance may pay the dealer or agent a fee of up to 1% of
the dollar amount purchased. Certain purchases of Class A shares may qualify
for reduced or eliminated sales charges in accordance with a Fund's Combined
Purchase Privilege, Cumulative Quantity Discount, Statement of Intention,
Privilege for Certain Retirement Plans, Reinstatement Privilege and Sales at
Net Asset Value programs. Consult the Subscription Application and Statement
of Additional Information.

Class B Shares--Deferred Sales Charge Alternative

You can purchase Class B shares at net asset value without an initial sales
charge. However, you may pay a CDSC if you redeem shares within four years
after purchase. The amount of the CDSC (expressed as a percentage of the
lesser of the current net asset value or original cost) will vary according
to the number of years from the purchase of Class B shares until the
redemption of those shares.

The amount of the CDSC for each Fund is as set forth below. Class B shares of
a Fund purchased prior to the date of this Prospectus may be subject to a
different CDSC schedule, which was disclosed in the Fund's prospectus in use
at the time of purchase and is set forth in the Fund's current Statement of
Additional Information.

<TABLE>
<CAPTION>
Year Since Purchase CDSC
---------------------------------------------------------------
<S> <C>
First 4.0%
Second 3.0%
Third 2.0%
Fourth 1.0%
Fifth None
</TABLE>

Class B shares are subject to higher distribution fees than Class A shares
for a period (after which they convert to Class A shares) of eight years, or
six years with respect to Premier Growth Fund. The higher fees mean a higher
expense ratio, so Class B shares pay correspondingly lower dividends and may
have a lower net asset value than Class A shares.

Class C Shares--Asset-Based Sales Charge Alternative

You can purchase Class C shares without any initial sales charge or a CDSC. A
Fund will thus receive the full amount of your purchase, and you will receive
the entire net asset value of your shares upon redemption. Class C shares
incur higher distribution fees than Class A shares and do not convert to any
other class of shares of the Fund. The higher fees mean a higher expense
ratio, so Class C shares pay correspondingly lower dividends and may have a
lower net asset value than Class A shares.

Application of the CDSC

Shares obtained from dividend or distribution reinvestment are not subject to
the CDSC on Class A and Class B shares. The CDSC is deducted from the amount
of the redemption and is paid to AFD. The CDSC will be waived on redemptions
of shares following the death or disability of a shareholder or to meet the
requirements of certain qualified retirement plans. See the Statements of
Additional Information.

How the Funds Value Their Shares

The net asset value of each Class of shares of a Fund is calculated by
dividing the value of the Fund's net assets allocable to that Class by the
outstanding shares of that Class. Shares are valued each day the New York
Stock Exchange (the "Exchange") is open as of the close of regular trading
(currently 4:00 p.m. Eastern time). The securities in a Fund are valued at
their current market value determined on the basis of market quotations or,
if such quotations are not readily available, such other methods as the
Fund's Directors believe would accurately reflect fair market value.

General

The decision as to which Class of shares is more beneficial to you depends on
the amount and intended length of your investment. If you are making a large
investment, thus qualifying for a reduced sales charge, you might consider
Class A shares. If you are making a smaller investment, you might consider
Class B shares because 100% of your purchase is invested immediately. If you
are unsure of the length of your investment, you might consider Class C
shares because there are no initial or contingent deferred sales charges.
Consult your financial agent. Dealers and agents may receive differing
compensation for selling Class A, Class B or Class C shares. There is no size
limit on purchases of Class A shares. The maximum purchase of Class C shares
is $5,000,000. The maximum purchase of Class B shares is $250,000. The Funds
may refuse any order to purchase shares.

In addition to the discount or commission paid to dealers or agents, AFD from
time to time pays additional cash or other incentive to dealers or agents,
including Equico Securities, Inc., an affiliate of AFD, in connection with
the sale of shares of the Funds. Such additional amounts may be utilized, in
whole or in part, in some cases together with other revenues

40
<PAGE>

of such dealers or agents, to provide additional compensation to registered
representatives who sell shares of the Funds. On some occasions, such cash or
other incentives will be conditioned upon the sale of a specified minimum
dollar amount of the shares of a Fund and/or other Alliance Mutual Funds
during a specific period of time. Such incentives may take the form of
payment for attendance at seminars, meals, sporting events or theater
performances, or payment for travel, lodging and entertainment incurred in
connection with travel by persons associated with a dealer or agent and their
immediate family members to urban or resort locations within or outside the
United States. Such dealer or agent may elect to receive cash incentives of
equivalent amount in lieu of such payments.

HOW TO SELL SHARES

You may "redeem", i.e., sell your shares in a Fund to the Fund on any day the
Exchange is open, either directly or through your financial intermediary. The
price you will receive is the net asset value (less any applicable CDSC for
Class A and Class B shares) next calculated after the Fund receives your
request in proper form. Proceeds generally will be sent to you within seven
days. However, for shares recently purchased by check or electronic funds
transfer, a Fund will not send proceeds until it is reasonably satisfied that
the check or electronic funds transfer has been collected (which may take up
to 15 days).

Selling Shares Through Your Broker

A Fund must receive your broker's request before 4:00 p.m. Eastern time for
you to receive that day's net asset value (less any applicable CDSC for Class
A and Class B shares). Your broker is responsible for furnishing all
necessary documentation to a Fund and may charge you for this service.

Selling Shares Directly To A Fund

Send a signed letter of instruction or stock power form to Alliance Fund
Services ("AFS"), each Fund's registrar, transfer agent and
dividend-disbursing agent, along with certificates, if any, that represent
the shares you want to sell. For your protection, signatures must be
guaranteed by a bank, a member firm of a national stock exchange or other
eligible guarantor institution. Stock power forms are available from your
financial intermediary, AFS, and many commercial banks. Additional
documentation is required for the sale of shares by corporations,
intermediaries, fiduciaries and surviving joint owners. For details contact:

Alliance Fund Services
P.O. Box 1520
Secaucus, NJ 07096-1520
1-800-221-5672

Alternatively, a request for redemption of shares for which no stock
certificates have been issued can also be made by telephone to 800-221-5672
by a shareholder who has completed the Subscription Application or an
"Autosell" application obtained from AFS. Telephone redemption requests must
be for at least $500 and may not exceed $100,000, and must be made between 9
a.m. and 4 p.m. New York time on a Fund business day. Proceeds of telephone
redemptions will be sent by electronic funds transfer. Proceeds of telephone
redemptions also may be sent by check to a shareholder's address of record,
but only once in any 30-day period and in amount not exceeding $25,000.
Telephone redemption by check is not available for shares purchased within 15
calendar days prior to the redemption request, shares held in nominee or
"street name" accounts or retirement plan accounts or shares held by a
shareholder who has changed his or her address of record within the previous
30 calendar days.

General

The sale of shares is a taxable transaction for federal tax purposes. Under
unusual circumstances, a Fund may suspend redemptions or postpone payment for
up to seven days or longer, as permitted by federal securities law. The Funds
reserve the right to close an account that through redemption has remained
below $200 for 90 days. Shareholders will receive 60 days' written notice to
increase the account value before the account is closed.

During drastic economic or market developments, you might have difficulty
reaching AFS by telephone, in which event you should issue written
instructions to AFS. AFS is not responsible for the authenticity of
telephonic requests to purchase, sell or exchange shares. AFS will employ
reasonable procedures to verify that telephone requests are genuine, and
could be liable for losses resulting from unauthorized transactions if it
failed to do so. Dealers and agents may charge a commission for handling
telephonic requests. The telephone service may be suspended or terminated at
any time without notice.

SHAREHOLDER SERVICES

AFS offers a variety of shareholder services. For more information about
these services or your account, call AFS's toll-free number, 800-221-5672.
Some services are described in the attached Application. A shareholder's
manual explaining all available services will be provided upon request. To
request a shareholder manual, call 800-227-4618.

HOW TO EXCHANGE SHARES

You may exchange your shares of any Fund for shares of the same class of
other Alliance Mutual Funds (which include AFD Exchange Reserves, a money
market fund managed by Alliance). Exchanges of shares are made at the net
asset values next determined, without sales or service charges. Exchanges may
be made by telephone or written request.

Class A and Class B shares will continue to age without regard to exchanges
for purposes of determining the CDSC, if any, upon redemption and, in the
case of Class B shares, for the purposes of conversion to Class A shares.
After an exchange, your Class B shares will automatically convert to Class A
shares in accordance with the conversion schedule applicable to the Class B
shares of the Alliance Mutual Fund you originally purchased for cash
("original shares"). When redemption occurs, the CDSC applicable to the
original shares is applied.

41
<PAGE>

Please read carefully the Prospectus of the mutual fund into which you are
exchanging before submitting the request. Call AFS at 800-221-5672 to
exchange uncertificated shares. An exchange is a taxable capital transaction
for federal tax purposes. The exchange service may be changed, suspended, or
terminated on 60 days' written notice.

- --------------------------------------------------------------------------------
Management Of The Funds
- --------------------------------------------------------------------------------

ADVISER

Alliance, which is a Delaware limited partnership with principal offices at
1345 Avenue of the Americas, New York, New York 10105, has been retained
under an advisory agreement (the "Advisory Agreement") to provide investment
advice and, in general, to conduct the management and investment program of
each Fund, subject to the general supervision and control of the Directors of
the Fund.

The following table lists the person or persons who are primarily responsible
for the day-to-day management of each Fund's portfolio, the length of time
that each person has been primarily responsible, and each person's principal
occupation during the past five years.

<TABLE>
<CAPTION>
Principal occupation
during the past
Fund Employee; year; title five years
- ------------------------------------------------------------------------------
<S> <C> <C>
Alliance Fund Alfred Harrison since 1989-- Associated with
Vice Chairman of Alliance Capital Alliance
Management Corporation
("ACMC")*

Paul H. Jenkel since 1985-- Associated with
Senior Vice President of ACMC Alliance

Growth Fund Tyler Smith since inception-- Associated with
Senior Vice President of ACMC Alliance since
July 1993; prior
thereto,
associated with
Equitable Capital
Management
Corporation
("Equitable
Capital")**

Premier Growth Fund Alfred Harrison since inception-- (see above)
(see above)

Counterpoint Fund Jon H. Outcalt since inception-- Associated with
Senior Vice President of ACMC Alliance

David P. Handke, Jr. since Associated with
inception--Vice President of ACMC Alliance

Technology Fund Peter Anastos since 1992-- Associated with
Senior Vice President of ACMC Alliance

Gerald T. Malone since 1992-- Associated with
Vice President of ACMC Alliance since
1992; prior
thereto
associated with
College
Retirement
Equities Fund

Quasar Fund Alden M. Stewart since 1994-- Associated with
Executive Vice President of ACMC Alliance since
1993; prior
thereto,
associated with
Equitable Capital

Randall E. Haase since 1994 -- Associated with
Vice President of ACMC Alliance since July
1993; prior
thereto,
associated with
Equitable Capital

International Fund A. Rama Krishna since 1993 -- Associated with
Senior Vice President of ACMC Alliance since
1993, prior
thereto,
Chief Investment
Strategist and
Director of Equity
Research for First
Boston
Corporation

Worldwide
Privatization Mark H. Breedon since inception--- Associated with
Vice President of ACMC and Alliance
Director and Vice President of
Alliance Capital Limited ("ACL")***

New Europe Fund Eric N. Perkins since 1992 -- Associated with
Senior Vice President of ACMC Alliance

All-Asia Fund A. Rama Krishna since (see above)
inception (see above)

Global Small Cap Ronald L. Simcoe since 1993-- Associated with
Fund Vice President of ACMC Alliance since
1993; prior thereto,
associated with
Equitable Capital

Alden Stewart since 1994-- (see above)
(see above)

Randall E. Haase since 1994-- (see above)
(see above)

Strategic Balanced Judith Taylor since inception-- Associated with
Fund Senior Vice President of ACMC Alliance since
July 1993; prior
thereto,
associated with
Equitable Capital

Balanced Shares Bruce W. Calvert since 1990-- Associated with
Vice Chairman and the Chief Alliance
Investment Officer of ACMC

Income Builder Fund Andrew M. Aran since 1994-- Associated with
Senior Vice President of ACMC Alliance since
March 1991; prior
thereto, a Vice
President of
PaineWebber, Inc.
since June 1990
and a Vice
President of
Citicorp since
prior to 1990

Utility Income Fund Alan Levi since 1994-- Associated with
Senior Vice President and Alliance
Director of Research of ACMC

Growth and Income Paul Rissman since 1995-- Associated with
Fund Vice President of ACMC Alliance
</TABLE>

- --------------------------------------------------------------------------------

* The sole general partner of Alliance.

** Equitable Capital was, prior to Alliance's acquisition of it, a management
firm under common control with Alliance.

*** An indirect wholly-owned subsidiary of Alliance.

42
<PAGE>

Alliance is a leading international investment manager supervising client
accounts with assets as of September 30, 1994 totaling more than $123 billion
(of which approximately $40 billion represented the assets of investment
companies). Alliance's clients are primarily major corporate employee benefit
funds, public employee retirement systems, investment companies, foundations
and endowment funds. The 50 registered investment companies managed by
Alliance comprising 102 separate investment portfolios currently have over
one million shareholders. As of September 30, 1994, Alliance was retained as
an investment manager for 28 of the Fortune 100 companies.

ACMC, the sole general partner of, and the owner of a 1% general partnership
interest in, Alliance, is an indirect wholly-owned subsidiary of The
Equitable Life Assurance Society of the United States ("Equitable"), one of
the largest life insurance companies in the United States, which is a
wholly-owned subsidiary of The Equitable Companies Incorporated, a holding
company controlled by AXA, a French insurance holding company. Certain
information concerning the ownership and control of Equitable by AXA is set
forth in each Fund's Statement of Additional Information under "Management of
the Fund."

ADMINISTRATOR AND CONSULTANT TO ALL-ASIA FUND

Alliance has been retained by All-Asia Fund under an administration agreement
(the "Administration Agreement") to perform administrative services necessary
for the operation of the Fund. For a description of such services, see the
Statement of Additional Information of the Fund.

In connection with its provision of advisory services to All-Asia Fund,
Alliance has retained at its expense OCBC Asset Management Limited ("OAM") as
a consultant to provide to Alliance such statistical and other factual
information, research and assistance with respect to economic, financial,
political, technological and social conditions and trends in Asian countries,
including information on markets and industries, as Alliance shall from time
to time request. OAM will not furnish investment advice or make
recommendations regarding the purchase or sale of securities by the Fund nor
will it be responsible for making investment decisions involving Fund assets.

OAM is one of the largest Singapore-based investment management companies
specializing in investment in Asia-Pacific markets. OAM provides consulting
and advisory services to institutions and individuals, including mutual
funds. As of June 30, 1994, OAM had approximately $1 billion in assets under
management.

OAM is a wholly-owned subsidiary of Oversea-Chinese Banking Corporation
Limited ("OCBC Bank"), which is based in Singapore. The OCBC Bank Group has
an extensive network of banking offices in the Asian Pacific region. The OCBC
Bank Group engages in a wide variety of activities including commercial
banking, investment banking, and property and hotel investment and
management. OCBC Bank is the third largest company listed on the Stock
Exchange of Singapore with a market capitalization as of June 30, 1994 of
$6.3 billion.

EXPENSES OF WORLDWIDE PRIVATIZATION FUND AND ALL-ASIA FUND

In addition to the payments to Alliance under the Advisory Agreement with
Worldwide Privatization Fund and the Advisory Agreement and Administration
Agreement with All-Asia Fund, all as described above, each such Fund pays
certain other costs, including (i) custody, transfer and dividend disbursing
expenses, (ii) fees of the Directors who are not affiliated with Alliance,
(iii) legal and auditing expenses (iv) clerical, accounting and other office
costs, (v) costs of printing each Fund's prospectuses and shareholder
reports, (vi) costs of maintaining each Fund's existence, (vii) interest
charges, taxes, brokerage fees and commissions, (viii) costs of stationery
and supplies, (ix) expenses and fees related to registration and filings with
the Commission and with state regulatory authorities, (x) upon the approval
of the Board of Directors, costs of personnel of Alliance or its affiliates
rendering clerical, accounting and other office services, and (xi) such
promotional expenses as may be contemplated by the Distribution Services
Agreement, described below.

DISTRIBUTION SERVICES AGREEMENTS

Rule 12b-1 adopted by the Commission under the 1940 Act permits an investment
company to pay expenses associated with the distribution of its shares in
accordance with a duly adopted plan. Each Fund has adopted one or more "Rule
12b-1 plans" (for each Fund, a "Plan") and has entered into a Distribution
Services Agreement (the "Agreement") with AFD. Pursuant to its Plan, a Fund
pays to AFD a Rule 12b-1 distribution services fee, which may not exceed an
annual rate of .30% (.50% with respect to Growth Fund, Premier Growth Fund
and Strategic Balanced Fund) of the Fund's aggregate average daily net assets
attributable to the Class A shares, 1.00% of the Fund's aggregate average
daily net assets attributable to the Class B shares and 1.00% of the Fund's
aggregate average daily net assets attributable to the Class C shares, for
distribution expenses. The Directors of Growth Fund and Strategic Balanced
Fund currently limit payments with respect to Class A shares under the Plan
to .30% of each Fund's aggregate average daily net assets attributable to
Class A shares. The Plans provide that a portion of the distribution services
fee in an amount not to exceed .25% of the aggregate average daily net assets
of each Fund attributable to each class of shares constitutes a service fee
used for personal service and/or the maintenance of shareholder accounts.

The Plans provide that AFD will use the distribution services fee received
from a Fund in its entirety for payments (i) to compensate broker-dealers or
other persons for providing distribution assistance, (ii) to otherwise
promote the sale of shares of the Fund, and (iii) to compensate
broker-dealers, depository institutions and other financial intermediaries
for providing administrative, accounting and other services with respect to
the Fund's shareholders. In this regard, some payments under the Plans are
used to compensate financial intermediaries with trail or maintenance
commissions in an amount equal to .25%, annualized, with respect to Class A
shares and Class B shares, and 1.00%, annualized, with

43
<PAGE>

respect to Class C shares, of the assets maintained in a Fund by their
customers. Distribution services fees received from the Funds, except Growth
Fund and Strategic Balanced Fund, with respect to Class A shares will not be
used to pay any interest expenses, carrying charges or other financing costs
or allocation of overhead of AFD. Distribution services fees received from
the Funds, with respect to Class B and Class C shares, may be used for these
purposes. The Plans also provide that Alliance may use its own resources to
finance the distribution of each Fund's shares.

The Funds are not obligated under the Plans to pay any distribution services
fee in excess of the amounts set forth above. Except as noted below for
Growth Fund and Strategic Balanced Fund, with respect to Class A shares of each
Fund, distribution expenses accrued by AFD in one fiscal year may not be paid
from distribution services fees received from the Fund in subsequent fiscal
years. Except as noted below for Growth Fund and Strategic Balanced Fund,
AFD's compensation with respect to Class B and Class C shares under the Plans of
the other Funds is directly tied to its expenses incurred. Actual
distribution expenses for such Class B and Class C shares for any given year,
however, will probably exceed the distribution services fees payable under
the applicable Plan with respect to the class involved and, in the case of
Class B shares, payments received from CDSCs. The excess will be carried
forward by AFD and reimbursed from distribution services fees payable under
the Plan with respect to the class involved and, in the case of Class B
shares, payments subsequently received through CDSCs, so long as the Plan and
the Agreement are in effect. Since AFD's compensation under the Plans of
Growth Fund and Strategic Balanced Fund is not directly tied to the expenses
incurred by AFD, the amount of compensation received by it under the
applicable Plan during any year may be more or less than its actual expenses.

Unreimbursed distribution expenses incurred as of the end of each Fund's most
recently completed fiscal period, and carried over for reimbursement in
future years in respect of the Class B and Class C shares for all Funds
(except Growth Fund and Strategic Balanced Fund) were, as of that time, as
follows:

<TABLE>
<CAPTION>
Amount of Unreimbursed Distribution Expenses
(as % of Net Assets of Class)
-------------------------------------------------------
Class B Class C
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alliance Fund............................................. $ 1,442,425 (7.95%) $ 399,204 (6.41%)
Growth Fund............................................... $24,134,216 (3.21%) $ 529,804 (0.46%)
Premier Growth Fund....................................... $ 3,230,541 (2.31%) $ 165,741 (2.26%)
Counterpoint Fund......................................... $ 119,047 (22.58%) $ 125,891 (30.08%)
Technology Fund........................................... $ 698,886 (3.80%) $ 221,888 (2.97%)
Quasar Fund............................................... $ 557,782 (4.01%) $ 87,823 (7.20%)
International Fund........................................ $ 1,043,557 (3.49%) $ 251,661 (1.86%)
Worldwide Privatization Fund.............................. $ 994,925 (4.35%) ** **
New Europe Fund........................................... $ 1,373,204 (4.37%) $ 225,921 (1.90%)
All-Asia Fund............................................. * * * *
Global Small Cap Fund..................................... $ 642,361 (16.52%) $ 201,251 (15.13%)
Income Builder Fund....................................... $ 224,734 (11.25%) $1,507,457 (2.35%)
Strategic Balanced Fund................................... $ 523,532 (1.20%) $ 127,615 (2.96%)
Balanced Shares........................................... $ 844,835 (5.89%) $ 180,501 (2.89%)
Utility Income Fund....................................... $ 248,868 (10.58%) $ 236,172 (8.91%)
Growth and Income Fund.................................... $ 2,607,181 (2.54%) $ 355,256 (1.83%)
</TABLE>

- --------------------------------------------------------------------------------

* This Fund has not yet completed a fiscal period.

** No Class C shares were outstanding during this Fund's fiscal period.

The Plans are in compliance with rules of the National Association of Securities
Dealers, Inc. which effectively limit the annual asset-based sales charges and
service fees that a mutual fund may pay on a class of shares to .75% and .25%,
respectively, of the average annual net assets attributable to that class. The
rules also limit the aggregate of all front-end, deferred and asset-based sales
charges imposed with respect to a class of shares by a mutual fund that also
charges a service fee to 6.25% of cumulative gross sales of shares of that
class, plus interest at the prime rate plus 1% per annum.

The Glass-Steagall Act and other applicable laws may limit the ability of a
bank or other depository institution to become an underwriter or distributor
of securities. However, in the opinion of the Funds' management, based on the
advice of counsel, these laws do not prohibit such depository institutions
from providing services for investment companies such as the administrative,
accounting and other services referred to in the Agreements. In the event
that a change in these laws prevented a bank from providing such services, it
is expected that other services arrangements would be made and that
shareholders would not be adversely affected. The State of Texas requires
that shares of a Fund may be sold in that state only by dealers or other
financial institutions that are registered there as broker-dealers.

- --------------------------------------------------------------------------------
Dividends, Distributions
- --------------------------------------------------------------------------------
And Taxes
- --------------------------------------------------------------------------------

DIVIDENDS AND DISTRIBUTIONS

If you receive an income dividend or capital gains distribution in cash you
may, within 30 days following the date of its payment, reinvest the dividend
or distribution in additional shares of that Fund without charge by returning
to Alliance, with appropriate instructions, the check representing such
dividend or distribution. Thereafter, unless you otherwise specify, you will
be deemed to have elected to reinvest all subsequent dividends and
distributions in shares of that Fund.

Each income dividend and capital gains distribution, if any, declared by a
Fund on its outstanding shares will, at the election of each shareholder, be
paid in cash or in additional shares of the same class of shares of that Fund
having an aggregate net asset value as of the payment date of such dividend
or distribution equal to the cash amount of such income dividend or
distribution. Election to receive dividends and distributions in cash or
shares is made at the time shares are initially purchased and may be changed
at any time prior to the record date for a particular dividend or
distribution. Cash dividends can be paid by check or, if the shareholder so
elects, electronically via the ACH network. There is no sales or other charge
in connection with the reinvestment of dividends and capital gains
distributions. Dividends paid by a Fund, if any, with respect to Class A,
Class B and Class C shares will be calculated in the same manner at the same
time on the

44
<PAGE>

same day and will be in the same amount, except that the higher distribution
services fees applicable to Class B and C shares, and any incremental transfer
agency costs relating to Class B shares, will be borne exclusively by the class
to which they relate.

While it is the intention of each Fund to distribute to its shareholders
substantially all of each fiscal year's net income and net realized capital
gains, if any, the amount and time of any such dividend or distribution must
necessarily depend upon the realization by such Fund of income and capital gains
from investments. There is no fixed dividend rate, and there can be no assurance
that a Fund will pay any dividends or realize any capital gains.

If you buy shares just before a Fund deducts a distribution from its net
asset value, you will pay the full price for the shares and then receive a
portion of the price back as a taxable distribution.

FOREIGN INCOME TAXES

Investment income received by a Fund from sources within foreign countries
may be subject to foreign income taxes withheld at the source. To the extent
that any Fund is liable for foreign income taxes withheld at the source, each
Fund intends, if possible, to operate so as to meet the requirements of the
Code to "pass through" to the Fund's shareholders credits for foreign income
taxes paid, but there can be no assurance that any Fund will be able to do so.

U.S. FEDERAL INCOME TAXES

Each Fund intends to qualify to be taxed as a "regulated investment company"
under the Code. To the extent that a Fund distributes its taxable income and
net capital gain to its shareholders, qualification as a regulated investment
company relieves that Fund of federal income and excise taxes on that part of
its taxable income including net capital gains which it pays out to its
shareholders. Dividends out of net ordinary income and distributions of net
short-term capital gains are taxable to the recipient shareholders as
ordinary income. In the case of corporate shareholders, such dividends may be
eligible for the dividends-received deduction, except that the amount
eligible for the deduction is limited to the amount of qualifying dividends
received by the Fund. A corporation's dividends-received deduction will be
disallowed unless the corporation holds shares in the Fund at least 46 days.
Furthermore, the dividends-received deduction will be disallowed to the
extent a corporation's investment in shares of a Fund is financed with
indebtedness.

The excess of net long-term capital gains over the net short-term capital
losses realized and distributed by each Fund to its shareholders as capital
gains distributions is taxable to the shareholders as long-term capital
gains, irrespective of the length of time a shareholder may have held his or
her stock. Long-term capital gains distributions are not eligible for the
dividends-received deduction referred to above.

Under the current federal tax law the amount of an income dividend or capital
gains distribution declared by a Fund during October, November or December of
a year to shareholders of record as of a specified date in such a month that
is paid during January of the following year is includable in the prior
year's taxable income of shareholders that are calendar year taxpayers.

Any dividend or distribution received by a shareholder on shares of a Fund
will have the effect of reducing the net asset value of such shares by the
amount of such dividend or distribution. Furthermore, a dividend or
distribution made shortly after the purchase of such shares by a shareholder,
although in effect a return of capital to that particular shareholder, would
be taxable to him or her as described above. If a shareholder held shares six
months or less and during that period received a distribution taxable to such
shareholder as long-term capital gain, any loss realized on the sale of such
shares during such six-month period would be a long-term capital loss to the
extent of such distribution.

A dividend or capital gains distribution with respect to shares of a Fund
held by a tax-deferred or qualified plan, such as an individual retirement
account, 403(b)(7) retirement plan or corporate pension or profit-sharing
plan, will not be taxable to the plan. Distributions from such plans will be
taxable to individual participants under applicable tax rules without regard
to the character of the income earned by the qualified plan.

Distributions by a Fund may be subject to state and local taxes. Alliance
Fund, Premier Growth Fund, Technology Fund, Quasar Fund, New Europe Fund,
Balanced Shares and Growth and Income Fund are qualified to do business in
the Commonwealth of Pennsylvania and, therefore, are subject to the
Pennsylvania foreign franchise and corporate net income tax in respect of
their business activities in Pennsylvania. Accordingly, shares of such Funds
are exempt from Pennsylvania personal property taxes. These Funds anticipate
continuing such business activities but reserve the right to suspend them at
any time, resulting in the termination of the exemptions.

A Fund will be required to withhold 31% of any payments made to a shareholder
if the shareholder has not provided a certified taxpayer identification
number to the Fund, or the Secretary of the Treasury notifies a Fund that a
shareholder has not reported all interest and dividend income required to be
shown on the shareholder's Federal income tax return.

Shareholders will be advised annually as to the federal tax status of
dividends and capital gains distributions made by a Fund for the preceding
year. Shareholders are urged to consult their tax advisers regarding their
own tax situation.

45
<PAGE>

- --------------------------------------------------------------------------------
General Information
- --------------------------------------------------------------------------------

PORTFOLIO TRANSACTIONS

Consistent with the Rules of Fair Practice of the National Association of
Securities Dealers, Inc., and subject to seeking best price and execution, a
Fund may consider sales of its shares as a factor in the selection of dealers
to enter into portfolio transactions with the Fund.

ORGANIZATION

Each of the following Funds is a Maryland corporation organized in the year
indicated: The Alliance Fund, Inc. (1938), Alliance Balanced Shares, Inc.
(1932), Alliance Premier Growth Fund, Inc. (1992), Alliance Technology Fund,
Inc. (1980), Alliance Quasar Fund, Inc. (1989), Alliance Worldwide
Privatization Fund, Inc. (1994), Alliance New Europe Fund, Inc. (1990),
Alliance All-Asia Investment Fund, Inc. (1994), Alliance Global Small Cap Fund,
Inc. (1966), Alliance Income Builder Fund, Inc. (1991), Alliance Utility
Income Fund, Inc. (1993), and Alliance Growth and Income Fund, Inc. (1932).
Each of the following Funds is either a Massachusetts business trust or a
series of a Massachusetts business trust organized in the year indicated:
Alliance Growth Fund and Alliance Strategic Balanced Fund (each a series of The
Alliance Portfolios) (1987), Alliance Counterpoint Fund (1984) and Alliance
International Fund (1980). Prior to August 2, 1993, The Alliance Portfolios
was known as The Equitable Funds, Growth Fund was known as The Equitable
Growth Fund and Strategic Balanced Fund was known as The Equitable Balanced
Fund. Prior to March 22, 1994, Income Builder Fund was known as Alliance
Multi-Market Income and Growth Trust, Inc.

It is anticipated that annual shareholder meetings will not be held;
shareholder meetings will be held only when required by federal, or in the
case of the Funds organized as Maryland corporations, state law. Shareholders
have available certain procedures for the removal of Directors.

A shareholder in a Fund will be entitled to his or her pro rata share of all
dividends and distributions arising from the Fund's assets and, upon
redeeming shares, will receive the then current net asset value of the Fund
represented by the redeemed shares less any applicable CDSC. The Funds are
empowered to establish, without shareholder approval, additional portfolios,
which may have different investment objectives, and additional classes of
shares. If an additional portfolio or class were established in a Fund, each
share of the portfolio or class would normally be entitled to one vote for
all purposes. Generally, shares of each portfolio and class would vote
together as a single class on matters, such as the election of Directors,
that affect each portfolio and class in substantially the same manner. Class
A, B and C shares have identical voting, dividend, liquidation and other
rights, except that each class bears its own distribution and transfer agency
expenses. Each class of shares votes separately with respect to a Fund's Rule
12b-1 distribution plan and other matters for which separate class voting is
appropriate under applicable law. Shares are freely transferable, are
entitled to dividends as determined by the Directors and, in liquidation of a
Fund, are entitled to receive the net assets of the Fund. Since this
Prospectus sets forth information about all the Funds, it is theoretically
possible that a Fund might be liable for any materially inaccurate or
incomplete disclosure in this Prospectus concerning another Fund. Based on
the advice of counsel, however, the Funds believe that the potential
liability of each Fund with respect to the disclosure in this Prospectus
extends only to the disclosure relating to that Fund. Certain additional
matters relating to a Fund's organization are discussed in its Statement of
Additional Information.

REGISTRAR, TRANSFER AGENT AND DIVIDEND-DISBURSING AGENT

AFS, an indirect wholly-owned subsidiary of Alliance, located at 500 Plaza
Drive, Secaucus, New Jersey 07094, acts as each Fund's registrar, transfer
agent and dividend-disbursing agent for a fee based upon the number of
shareholder accounts maintained for the Funds. The transfer agency fee with
respect to the Class B shares will be higher than the transfer agency fee
with respect to the Class A shares or Class C shares.

PRINCIPAL UNDERWRITER

AFD, an indirect wholly-owned subsidiary of Alliance, located at 1345 Avenue
of the Americas, New York, New York 10105, is the principal underwriter of
shares of the Funds.

PERFORMANCE INFORMATION

From time to time, the Funds advertise their "total return," which is
computed separately for Class A, Class B and Class C shares. Such
advertisements disclose a Fund's average annual compounded total return for
the periods prescribed by the Commission. A Fund's total return for each such
period is computed by finding, through the use of a formula prescribed by the
Commission, the average annual compounded rate of return over the period that
would equate an assumed initial amount invested to the value of the
investment at the end of the period. For purposes of computing total return,
income dividends and capital gains distributions paid on shares of a Fund are
assumed to have been reinvested when paid and the maximum sales charges
applicable to purchases and redemptions of a Fund's shares are assumed to
have been paid.

Balanced Fund, Growth and Income Fund, Income Builder Fund, Strategic
Balanced Fund and Utility Income Fund may also advertise their "yield," which
is also computed separately for Class A, Class B and Class C shares. A Fund's
yield for any 30-day (or one-month) period is computed by dividing the net
investment income per share earned during such period by the maximum public
offering price per share on the last day of the

46
<PAGE>

period, and then annualizing such 30-day (or one-month) yield in accordance
with a formula prescribed by the Commission which provides for compounding on
a semi-annual basis.

Strategic Balanced Fund, Balanced Shares, Income Builder Fund, Utility Income
Fund and Growth and Income Fund may also state in sales literature an "actual
distribution rate" for each class which is computed in the same manner as
yield except that actual income dividends declared per share during the
period in question are substituted for net investment income per share. The
actual distribution rate is computed separately for Class A, Class B and
Class C shares.

A Fund will include performance data for each class of shares in any
advertisement or sales literature using performance data of that Fund. These
advertisements may quote performance rankings or ratings of a Fund by
financial publications or independent organizations such as Lipper Analytical
Services, Inc. and Morningstar, Inc. or compare a Fund's performance to
various indices.

ADDITIONAL INFORMATION

This Prospectus and the Statements of Additional Information, which have been
incorporated by reference herein, do not contain all the information set
forth in the Registration Statements filed by the Funds with the Commission
under the Securities Act. Copies of the Registration Statements may be
obtained at a reasonable charge from the Commission or may be examined,
without charge, at the offices of the Commission in Washington, D.C.

This prospectus does not constitute an offering in any state in which such
offering may not lawfully be made.

This prospectus is intended to constitute an offer by each Fund only of the
securities of which it is the issuer and is not intended to constitute an offer
by any Fund of the securities of any other Fund whose securities are also
offered by this prospectus. No Fund intends to make any representation as to the
accuracy or completeness of the disclosure in this prospectus relating to any
other Fund. See "General Information--Organization."

47
<PAGE>

- --------------------------------------------------------------------------------
Subscription Application
- --------------------------------------------------------------------------------

Alliance Stock Funds

(see instructions at the front of the application)

- --------------------------------------------------------------------------------
1. Your Account Registration (Please Print)
- --------------------------------------------------------------------------------

[ ] Individual or Joint Account

- --------------------------------------------------------------------------------
Owner's Name (First Name) (MI) (Last Name)

- -
- -------------------------------------------------
Social Security Number (Required to open account)

- --------------------------------------------------------------------------------
Joint Owner's Name* (First Name) (MI) (Last Name)
*Joint Tenants with right of survivorship unless otherwise indicated

[ ] Gift/Transfer To A Minor

- --------------------------------------------------------------------------------
Custodian - One Name Only (First Name) (MI) (Last Name)

- --------------------------------------------------------------------------------
Minor (First Name) (MI) (Last Name)

- -
- ---------------------------------------------------------
Minor's Social Security Number (Required to open account)

Under the State of ___ (Minor's Residence) Uniform Gifts/Transfer to Minor's Act

[ ] Trust Account

- --------------------------------------------------------------------------------
Name of Trustee

- --------------------------------------------------------------------------------
Name of Trust

- --------------------------------------------------------------------------------
Name of Trust (cont'd)

- ------------------ -----------------------------------------------------------
Trust Dated Tax ID or Social Security Number (Required to open account)

[ ] Other

- --------------------------------------------------------------------------------
Name of Corporation, Partnership or other Entity

- --------------------------
Tax ID Number

- --------------------------------------------------------------------------------
2. Address
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
Street

- --------------------------------------------------------------------------------
City State Zip Code

- --------------------------------------------------------------------------------
If Non-U.S., Specify Country

- - - -
- --------------------------------------------------------------------------------
Daytime Phone Evening Phone

I am a: [ ] U.S. Citizen [ ] Non-Resident Alien [ ] Resident Alien [ ] Other

- -- --

For Alliance Use Only

- -- --
<PAGE>

- --------------------------------------------------------------------------------
3. Initial Investment
- --------------------------------------------------------------------------------

Minimum: $250; Maximum: Class B only - $250,000; Class C only - $5,000,000.
Make all checks payable to The Alliance Stock Fund in which you are investing.

I hereby subscribe for shares of the following Alliance Stock Fund(s):

<TABLE>
<CAPTION>
Class A Class B Class C
(Initial Dollar (Contingent Deferred Dollar (Asset-based Sales Dollar
Sales Charge) Amount Sales Charge) Amount Charge) Amount
-------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
[ ] Alliance Fund [ ](44) ---------- [ ] (43) ---------- [ ] (344) ----------
[ ] Growth Fund [ ](31) ---------- [ ] (01) ---------- [ ] (331) ----------
[ ] Premier Growth Fund [ ](78) ---------- [ ] (79) ---------- [ ] (378) ----------
[ ] Counterpoint Fund [ ](19) ---------- [ ] (219) ---------- [ ] (319) ----------
[ ] Technology Fund [ ](82) ---------- [ ] (282) ---------- [ ] (382) ----------
[ ] Quasar Fund [ ](26) ---------- [ ] (29) ---------- [ ] (326) ----------
[ ] International Fund [ ](40) ---------- [ ] (41) ---------- [ ] (340) ----------
[ ] Worldwide Privatization Fund [ ](112) ---------- [ ] (212) ---------- [ ] (312) ----------
[ ] New Europe Fund [ ](62) ---------- [ ] (58) ---------- [ ] (362) ----------
[ ] All-Asia Fund [ ](118) ---------- [ ] (218) ---------- [ ] (318) ----------
[ ] Global Small Cap Fund [ ](45) ---------- [ ] (48) ---------- [ ] (345) ----------
[ ] Strategic Balanced Fund [ ](32) ---------- [ ] (02) ---------- [ ] (332) ----------
[ ] Balanced Shares [ ](96) ---------- [ ] (75) ---------- [ ] (396) ----------
[ ] Income Builder Fund [ ](111) ---------- [ ] (211) ---------- [ ] (311) ----------
[ ] Utility Income Fund [ ](9) ---------- [ ] (209) ---------- [ ] (309) ----------
[ ] Growth & Income Fund [ ](94) ---------- [ ] (74) ---------- [ ] (394) ----------
</TABLE>

to be purchased with the enclosed check or draft for $_______________

-------------------------
Dealer Use Only
Wire Confirm No.:
-------------------------

- --------------------------------------------------------------------------------
4. Reduced Charges (Class A Only)
- --------------------------------------------------------------------------------

If you, your spouse or minor children own shares in other Alliance funds, you
may be eligible for a reduced sales charge. Please list below any existing
accounts to be considered and complete the Right of Accumulation section or
the Statement of Intent section.

- --------------------------------------------------------------------------------
Fund Account Number Fund Account Number

A. Right of Accumulation
[ ] Please link the accounts listed above for Right of Accumulation privileges,
so that this and future purchases will receive any discount for which they
are eligible.

B. Statement of Intent
[ ] I want to reduce my sales charge by agreeing to invest the following amount
over a 13-month period:
[ ] $100,000 [ ] $250,000 [ ] $500,000 [ ] $1,000,000

If the full amount indicated is not purchased within 13 months, I understand
an additional sales charge must be paid from my account.

- --------------------------------------------------------------------------------
Name on Account Account Number Name on Account Account Number

- --------------------------------------------------------------------------------
5. Distribution Options
- --------------------------------------------------------------------------------

If no box is checked, all distributions will be reinvested in
additional shares of the Fund

Income Dividends: (elect one) [ ] Reinvest dividends
[ ] Pay dividends in cash
[ ] Use Dividend Direction Plan

Capital Gains Distribution: (elect one) [ ] Reinvest capital gains
[ ] Pay capital gains in cash
[ ] Use Dividend Direction Plan

If you elect to receive your income dividends or capital gains distributions
in cash, please enclose a preprinted voided check from the bank account you
wish to have your dividends deposited into.**

If you wish to utilize the Dividend Direction Plan, please designate the
Alliance account you wish to have your dividends reinvested in:

- --------------------------------------------------------------------------------
Fund Name Existing Account No.

Special Distribution Instructions:

[ ] Please pay my distributions via check and send to the address
indicated in Section 2.

[ ] Please mail my distributions to the person and/or address designated below:

- --------------------------------------------------------------------------------
Name Address

- --------------------------------------------------------------------------------
City State Zip

- --------------------------------------------------------------------------------
6. Shareholder Options
- --------------------------------------------------------------------------------

A. Automatic Investment Program (AIP) **

I hereby authorize Alliance Fund Services, Inc. to draw on my bank account,
on or about the ______ day of each month for a monthly investment in my Fund
account in the amount of $____________ (minimum $25 per month). Please attach
a preprinted voided check from the bank account you wish to use.
NOTE: If your bank is not a member of the NACHA, your Alliance account will
be credited on or about the 20th of each month.

The Fund requires signatures of bank account owners exactly as they
appear on bank records.

- --------------------------------------------------------------------------------
Individual Account Date Joint Account Date

** Your bank must be a member of the National Automated Clearing House
Association (NACHA).
<PAGE>

B. Telephone Transactions

You can call our toll-free number 1-800-221-5672 and instruct Alliance Fund
Services, Inc. in a recorded conversation to purchase, redeem or exchange
shares for your account. Purchase and redemption requests will be processed
via electronic funds transfer (EFT) to and from your bank account.

Instructions: * Review the information in the Prospectus about telephone
transaction services.

* Check the box next to the telephone transaction service(s)
you desire.

* If you select the telephone purchase or redemption
privilege, you must write "VOID" across the face of a check
from the bank account you wish to use and attach it to this
application.

Purchases and Redemptions via EFT**

[ ] I hereby authorize Alliance Fund Services, Inc. to effect the purchase
and/or redemption of Fund shares for my account according to my telephone
instructions or telephone instructions from my Broker/Agent, and to
withdraw money or credit money for such shares via EFT from the bank
account I have selected.

The fund requires signatures of bank account owners exactly as they
appear on bank records.

- --------------------------------------------------------------------------------
Individual Account Owner Date Joint Account Owner Date

Telephone Exchanges and Redemptions by Check

Unless I have checked one or both boxes below, these privileges will
automatically apply, and by signing this application, I hereby authorize
Alliance Fund Services, Inc. to act on my telephone instructions, or on
telephone instructions from any person representing himself to be an
authorized employee of an investment dealer or agent requesting a redemption
or exchange on my behalf. (NOTE: Telephone exchanges may only be processed
between accounts that have identical registrations.) Telephone redemption
checks will only be mailed to the name and address of record; and the address
must have no change within the last 30 days. The maximum telephone redemption
amount is $25,000. This service can be enacted once every 30 days.

[ ] I do not elect the telephone exchange service.
---
[ ] I do not elect the telephone redemption by check service.
---
C. Systematic Withdrawal Plan (SWP) **

In order to establish a SWP, an investor must own or purchase shares of
the Fund having a current net asset value of at least:

* $10,000 for monthly payments;
* $5,000 for bi-monthly payments;
* $4,000 for quarterly or less frequent payments

[ ] I authorize this service to begin in _________ , 19__ , for the amount
Month
of $_______________ ($50.00 minimum)

Frequency: (Please select one)
[ ] Monthly
[ ] Bi-Monthly
[ ] Quarterly
[ ] Annually
[ ] In the months circled: J F M A M J J A S O N D

Please send payments to: (please select one)

[ ] My checking account. Select the date of the month on or about which
you wish the EFT payments to be made: _______________. Please enclose a
preprinted voided check to ensure accuracy. EFT not available to Class B
shareowners other than retirement plans.

[ ] My address of record designated in Section 2.

[ ] The payee and address specified below:

- --------------------------------------------------------------------------------
Name of Payee Address

- --------------------------------------------------------------------------------
City State Zip

D. Auto Exchange

[ ] I authorize Alliance Fund Services, Inc. to initiate a monthly exchange
for $____________ ($25.00 minimum) on the _________ day of the month,
into the Alliance Fund noted below:

Fund Name: ___________________________________________________

[ ] Existing account number:______________________________________

[ ] New account

Shares exchanged will be redeemed at net asset value computed on the date
of the month selected. (If the date selected is not a fund business day
the transaction will be processed on the prior fund business day.)
Certificates must remain unissued.

- --------------------------------------------------------------------------------
7. Shareholder Authorization This section MUST be completed
- --------------------------------------------------------------------------------

I certify under penalty of perjury that the number shown in Section 1 of this
form is my correct tax identification number or social security number and
that I have not been notified that this account is subject to backup
withholding.

By selecting any of the above telephone privileges, I agree that neither the
Fund nor Alliance, Alliance Fund Distributors, Inc., Alliance Fund Services,
Inc. or other Fund Agent will be liable for any loss, injury, damage or
expense as a result of acting upon telephone instructions purporting to be on
my behalf, that the Fund reasonably believes to be genuine, and that neither
the Fund nor any such party will be responsible for the authenticity of such
telephone instructions. I understand that any or all of these privileges may
be discontinued by me or the Fund at any time. I understand and agree that
the Fund reserves the right to refuse any telephone instructions and that my
investment dealer or agent reserves the right to refuse to issue any telephone
instructions I may request.

For non-residents only: Under penalties of perjury, I certify that to the
best of my knowledge and belief, I qualify as a foreign person as indicated
in Section 2.

I am of legal age and capacity and have received and read the Prospectus and
agree to its terms.

- --------------------------------------------------------------------------------
Signature Date

- --------------------------------------------------------------------------------
Acceptance Date:

- --------------------------------------------------------------------------------
Dealer/Agent Authorization For selected Dealers or Agents ONLY.
- --------------------------------------------------------------------------------

We hereby authorize Alliance Fund Services, Inc. to act as our agent in
connection with transactions under this authorization form; and we guarantee
the signature(s) set forth in Section 7, as well as the legal capacity of the
shareholder.

Dealer/Agent Firm Authorized Signature
---------------------------- -----------

Representative First Name MI Last Name
--------------- ---- ----------------------

Representative Number
-----------------------------------------------------------

Branch Office Address
-----------------------------------------------------------

City State Zip Code
-------------------------------- ------------- -----------

Branch Number Branch Phone ( )
-------------------------------- ---------------------

** Your bank must be a member of the National Automated
Clearing House Association (NACHA). 50074GEN-EQTYApp
<PAGE>

- --------------------------------------------------------------------------------
Alliance Subscription Application
- --------------------------------------------------------------------------------

The Alliance Stock Funds

Alliance Fund
Growth Fund
Premier Growth Fund
Counterpoint Fund
Technology Fund
Quasar Fund
International Fund
Worldwide Privatization Fund
New Europe Fund
All-Asia Fund
Global Small Cap Fund
Strategic Balanced Fund
Balanced Shares
Income Builder Fund
Utility Income Fund
Growth & Income Fund

- --------------------------------------------------------------------------------
Information And Instructions
- --------------------------------------------------------------------------------

To Open Your New Alliance Account

Please complete the application and mail it to:

Alliance Fund Services, Inc., P.O. Box 1520, Secaucus, New Jersey 07096-1520

Signatures - Please Be Sure To Sign the Application (Section 7)

If shares are registered in the name of:

. an individual, the individual should sign.

. joint tenants, both should sign.

. a custodian for a minor, the custodian should sign.

. a corporation or other organization, an authorized officer should sign
(please indicate corporate office or title).

. a trustee or other fiduciary, the fiduciary or fiduciaries should sign
(please indicate capacity).

Registration

To ensure proper tax reporting to the IRS:

. Individuals, Joint Tenants and Gift/Transfer to a Minor:
- Indicate your name exactly as it appears on your social security card.

. Trust/Other:

- Indicate the name of the entity exactly as it appeared on the
notice you received from the IRS when your Employer Identification number
was assigned.

Please Note:

. Certain legal documents will be required from corporations or other
organizations, executors and trustees, or if a redemption is requested by
anyone other than the shareholder of record. If you have any questions
concerning a redemption, contact the Fund at the number below.

. In the case of redemptions or repurchases of shares recently purchased by
check, redemption proceeds will not be made available until the Fund is
reasonably assured that the check has cleared, normally up to 15 calendar
days following the purchase date.

If We Can Assist You In Any Way, Please Do Not Hesitate To Call Us At:
1-(800) 221-5672.