MUNIYIELD
FLORIDA
INSURED
FUND
FUND LOGO
Annual Report
October 31, 1994
This report, including the financial information herein, is
transmitted to the shareholders of MuniYield Florida Insured Fund
for their information. It is not a prospectus, circular or
representation intended for use in the purchase of shares of the
Fund or any securities mentioned in the report. Past performance
results shown in this report should not be considered a
representation of future performance. The Fund has leveraged its
Common Shares by issuing Preferred Shares to provide Common
Shareholders with a potentially higher rate of return. Leverage
creates risks for Common Shareholders including the likelihood of
greater volatility of net asset value and market price of the Common
Shares, and the risk that fluctuations in the short-term dividend
rates of the Preferred Shares may affect the yield to Common
Shareholders.
MuniYield Florida
Insured Fund
Box 9011
Princeton, NJ
08543-9011
<PAGE>
MuniYield Florida Insured Fund
TO OUR SHAREHOLDERS
For the year ended October 31, 1994, the Common Shares of MuniYield
Florida Insured Fund earned $1.050 per share income dividends, which
includes earned and unpaid dividends of $0.073. This represents a
net annualized yield of 7.69%, based on a month-end net asset value
of $13.70 per share. Over the same period, the total investment
return on the Fund's Common Shares was -10.98%, based on a change in
per share net asset value from $16.56 to $13.70, and assuming
reinvestment of $1.060 per share income dividends.
For the six-month period ended October 31, 1994, the total
investment return on the Fund's Common Shares was -2.31%, based on a
change in per share net asset value from $14.51 to $13.70, and
assuming reinvestment of $0.445 per share income dividends.
The average yield of the Fund's Auction Market Preferred Shares for
the six months ended October 31, 1994 was 3.15%.
The Environment
As discussed in our last report to shareholders, the Federal Reserve
Board moved to counteract inflationary pressures by tightening
monetary policy. This trend continued during the May--October
period. Despite the series of preemptive strikes against inflation
by the central bank, concerns of increasing inflationary pressures
continued to prompt volatility in the US capital markets during the
period. In addition, the weakness of the US dollar in foreign
exchange markets prolonged stock and bond market declines.
Ongoing strength in the manufacturing sector and better-than-
expected economic results continue to fuel speculation that the
Federal Reserve Board will continue to raise short-term interest
rates in the months ahead. However, although consumer spending is
increasing, it is doing so at a lower rate than has been the case in
recent economic recoveries. In the weeks ahead, investors will
continue to assess economic data and inflationary trends in order to
gauge whether further increases in short-term interest rates are
imminent. Continued indications of moderate and sustainable levels
of economic growth would be positive for the US capital markets. At
the same time, greater US dollar stability in foreign exchange
markets would help to dampen expectations of significantly higher
short-term interest rates.
<PAGE>
The Municipal Market
The long-term tax-exempt market continued to erode throughout the
three months ended October 31, 1994. As measured by the Bond Buyer
Revenue Bond Index, yields on A-rated municipal revenue bonds
maturing in 30 years rose by almost 50 basis points (0.50%) to 6.95%
during the October 31, 1994 quarter. This represents the highest
level in tax-exempt bond yields in over two years. US Treasury bonds
suffered even greater declines during the quarter as Treasury bond
yields rose approximately 60 basis points to end the quarter at
8.00%.
The tax-exempt bond market reacted negatively throughout the October
quarter to indications that, despite a series of interest rate
increases by the Federal Reserve Board, the strength of the domestic
economy seen in recent quarters has not yet been significantly
reduced. While inflationary pressures have remained well contained,
additional Federal Reserve Board actions have been expected both to
ensure that domestic economic growth is eventually confined to
current levels and to assure nervous financial markets of its anti-
inflationary intentions.
Fortunately, while the demand for tax-exempt bonds has declined
somewhat in recent months, new bond issuance has remained greatly
reduced. During the quarter ended October 31, 1994, only $32 billion
in long-term tax-exempt securities were issued, a decline of over
50% versus the October 31, 1993 quarter. Similarly, for the six
months ended October 31, 1994, only $75 billion in municipal
securities were underwritten, a decline of over 50% versus the
comparable period a year earlier. This reduction in issuance in
recent quarters has allowed the municipal bond market to react to
both the decline in investor demand and the rise in fixed-income
yields in a more orderly fashion than in similar situations in the
past, particularly during 1987.
Long-term tax-exempt revenue bonds currently yield approximately 7%,
or almost 11.5% on an after-tax equivalent basis, to an investor in
the 39.6% Federal income tax bracket. As inflation has only
marginally increased in the past year, real tax-exempt interest
rates have risen dramatically. The Federal Reserve Board appears
committed to maintaining inflation at or below its current levels.
Indeed, most forecasts expect inflation to remain in its present
range of 3%--4% throughout 1995 and, potentially, for the remainder
of the 1990s. Real after-tax equivalent interest rates exceeding 7%
represent historically attractive municipal investments for long-
term investors.
<PAGE>
Federal Reserve Board actions taken thus far have yet to fully
impact US domestic growth and expected additional actions should
promote only a modest economic expansion within a benign
inflationary context beginning sometime early in 1995. Within such
an environment, it is unlikely that tax-exempt interest rates will
remain at their current attractive levels. Tax-exempt bond issuance
is unlikely to return to the historic high levels seen in 1992 and
1993, while investor demand should return as markets stabilize. As
we have discussed in earlier reports, the total number of tax-exempt
bonds outstanding is scheduled to decline dramatically in 1994 and
1995 as a result of both regular bond maturities and early
redemptions. Investors seeking tax-advantaged issues are likely to
find it very difficult to obtain currently available tax-exempt
yields as the current supply/demand balance is unlikely to be
maintained in the coming quarters.
Portfolio Strategy
During the six-month period ended October 31, 1994, with the
volatile municipal market, our strategy shifted to a more neutral
posture on interest rates. We achieved this by selling deep discount
bonds, which are more interest rate sensitive. We placed greater
emphasis on current coupon bonds and premium bonds. We maintained
this strategy throughout the past six months, enhancing the Fund's
current yield while reducing its interest rate volatility. New
issuance in the Florida market was down to little more than $3
billion, representing a decline of nearly 68% from the same
time last year.
Short-term tax-exempt interest rates traded in a range between
2.75%--3.375% for the last six months, despite the series of short-term
interest rate increases engineered by the Federal Reserve Board. The
demand for tax-exempt cash equivalents has been very strong for most
of this year and is expected to remain so in the coming quarters.
The tax-exempt yield curve remained very positive throughout this
year, consequently the leverage of the Preferred Shares has
continued to have a very positive impact on the yield paid to the
Fund's Common Shareholder. However, should the spread between short-
term and long-term interest rates narrow, the benefits of the
leverage will decline and, as a result, reduce the yield of the
Fund's Common Shares. (For a complete explanation of the benefits
and risks of leveraging, see page 3 of this report to shareholders.)
We appreciate your ongoing interest in MuniYield Florida Insured
Fund, and we look forward to serving your investment needs and
objectives in the months and years to come.
<PAGE>
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(Vincent R. Giordano)
Vincent R. Giordano
Vice President and Portfolio Manager
December 5, 1994
THE BENEFITS AND RISKS OF LEVERAGING
MuniYield Florida Insured Fund utilizes leveraging to seek to
enhance the yield and net asset value of its Common Shares. However,
these objectives cannot be achieved in all interest rate
environments. To leverage, the Fund issues Preferred Shares, which
pay dividends at prevailing short-term interest rates, and invests
the proceeds in long-term municipal bonds. The interest earned on
these investments is paid to Common Shareholders in the form of
dividends, and the value of these portfolio holdings is reflected in
the per share net asset value of the Fund's Common Shares. However,
in order to benefit Common Shareholders, the yield curve must be
positively sloped; that is, short-term interest rates must be lower
than long-term interest rates. At the same time, a period of
generally declining interest rates will benefit Common Shareholders.
If either of these conditions change, then the risks of leveraging
will begin to outweigh the benefits.
To illustrate these concepts, assume a fund's Common Share
capitalization of $100 million and the issuance of Preferred Shares
for an additional $50 million, creating a total value of $150
million available for investment in long-term municipal bonds. If
prevailing short-term interest rates are approximately 3% and long-
term interest rates are approximately 6%, the yield curve has a
strongly positive slope. The fund pays dividends on the $50 million
of Preferred Shares based on the lower short-term interest rates. At
the same time, the fund's total portfolio of $150 million earns the
income based on long-term interest rates.
<PAGE>
In this case, the dividends paid to Preferred Shareholders are
significantly lower than the income earned on the fund's long-term
investments, and therefore the Common Shareholders are the
beneficiaries of the incremental yield. However, if short-term
interest rates rise, narrowing the differential between short-term
and long-term interest rates, the incremental yield pick-up on the
Common Shares will be reduced. At the same time, the market value of
the fund's Common Shares (that is, its price as listed on the New
York Stock Exchange) may, as a result, decline. Furthermore, if long-
term interest rates rise, the Common Share's net asset value will
reflect the full decline in the price of the portfolio's
investments, since the value of the fund's Preferred Shares does not
fluctuate. In addition to the decline in net asset value, the market
value of the fund's Common Shares may also decline.
PORTFOLIO ABBREVIATIONS
To simplify the listings of MuniYield Florida Insured Fund's
portfolio holdings in the Schedule of Investments, we have
abbreviated the names of many of the securities according to the
list at right.
AMT Alternative Minimum Tax (subject to)
DATES Daily Adjustable Tax-Exempt Securities
HFA Housing Finance Authority
IDA Industrial Development Authority
IDR Industrial Development Revenue Bonds
PCR Pollution Control Revenue Bonds
RIB Residual Interest Bonds
SAVRS Select Auction Variable Rate
Securities
S/F Single-Family
UT Unlimited Tax
VRDN Variable Rate Demand Notes
<TABLE>
SCHEDULE OF INVESTMENTS (in Thousands)
<CAPTION>
S&P Moody's Face Value
Ratings Ratings Amount Issue (Note 1a)
Florida--102.1%
<S> <S> <C> <S> <C>
AAA Aaa $ 5,750 Boynton Beach, Florida, Utility System Revenue Refunding Bonds, 6.25% due
11/01/2020 (b) $ 5,529
AAA Aaa 1,000 Brevard County, Florida, Health Facilities Authority, Hospital Revenue Bonds
(Holmes Regional Medical Center Project), 5.75% due 10/01/2013 (d) 901
<PAGE>
NR* Aaa 2,500 Broward County, Florida, HFA, S/F Mortgage Revenue Bonds, AMT, 6.55% due
8/01/2019 (g)(h) 2,374
AAA Aaa 1,000 Broward County, Florida, Tourist Development Tax Split, Revenue Refunding Bonds
(Convention Center), 5.625% due 10/01/2013 (a) 895
Citrus County, Florida, PCR, Refunding (Florida Power Corp.--Crystal River) (d):
AAA Aaa 2,000 Series A, 6.625% due 1/01/2027 1,980
AAA Aaa 6,500 Series B, 6.35% due 2/01/2022 6,295
AAA Aaa 1,800 Clearwater, Florida, Water and Sewer Revenue Refunding Bonds, 6.50% due
12/01/2012 (d) 1,787
AAA Aaa 3,165 Coral Springs, Florida, Improvement District, Water and Sewer Revenue Bonds, UT,
Series C, 7.60% due 12/01/1999 (d)(e) 3,519
Dade County, Florida, Aviation Revenue Bonds, AMT (d):
AAA Aaa 1,750 Series B, 6.55% due 10/01/2013 1,731
AAA Aaa 8,750 Series B, 6.60% due 10/01/2022 8,585
AAA Aaa 4,085 Series C, 6.125% due 10/01/2020 3,821
AAA Aaa 4,500 Dade County, Florida, Health Facilities Authority, Hospital Revenue Bonds
(Baptist Hospital of Miami Project), Series A, 5.75% due 5/01/2021 (d)(i) 4,050
Dade County, Florida, Seaport Revenue Bonds, UT (a):
AAA Aaa 7,435 6.25% due 10/01/2021 7,145
AAA Aaa 3,000 6.50% due 10/01/2026 2,960
AAA Aaa 1,250 Enterprise County, Florida, Development District, Water and Sewer Revenue Bonds,
6.125% due 5/01/2024 (d) 1,179
AAA Aaa 1,000 Escambia County, Florida, Utility Authority Revenue Bonds, Series A, 6.25% due
1/01/2015 (b) 972
AAA NR* 3,090 Florida HFA, Revenue Refunding Bonds (General Mortgage), Series A, 6.40% due
6/01/2024 2,892
Florida State Board of Education, Public Education Revenue Bonds (Capital Outlay):
AA Aa 2,000 Series A, 6.75% due 6/01/2021 2,014
AA Aa 5,000 Series C, UT, 6.625% due 6/01/2022 4,996
AAA Aaa 5,800 Florida State Board of Finance, Department of General Service Revenue Bonds
(Natural Resource and Preservation Department), Series 2000-A, 6.25% due
7/01/2013 (d) 5,668
AAA Aaa 7,145 Florida State Municipal Power Agency Revenue Bonds (Power Supply Project),
6.25% due 10/01/2002 (a)(e) 7,488
</TABLE>
<PAGE>
<TABLE>
SCHEDULE OF INVESTMENTS (continued) (in Thousands)
<CAPTION>
S&P Moody's Face Value
Ratings Ratings Amount Issue (Note 1a)
Florida (continued)
<S> <S> <C> <S> <C>
AAA Aaa $ 5,000 Florida State Municipal Power Agency Revenue Bonds (Stanton II Project), 6.50%
due 10/01/2002 (a)(e) $ 5,326
Florida State Turnpike Authority, Turnpike Revenue Bonds, Series A (b):
AAA Aaa 2,230 6.35% due 7/01/2002 (e) 2,340
AAA Aaa 2,325 6.25% due 7/01/2009 2,312
AAA Aaa 2,000 6.30% due 7/01/2012 1,962
AAA Aaa 4,455 6.35% due 7/01/2022 4,341
AA Aa 4,800 Gainesville, Florida, Utility System Revenue Bonds, Series B, 6.50% due 10/01/2013 4,800
AAA Aaa 1,500 Hillsborough County, Florida, IDA, IDR (University Community Hospital), 6.50%
due 8/15/2019 (d) 1,493
A1+ VMIG1 7,300 Hillsborough County, Florida, IDA, PCR, Refunding (Tampa Electric Company
Project), VRDN, 3.55% due 5/15/2018 (f) 7,300
AAA Aaa 1,000 Hillsborough County, Florida, IDA, Revenue Bonds (Alleghany Health System--J.
Knox Village), 6.375% due 12/01/2012 (d) 986
AA Aaa 1,000 Jacksonville, Florida, Electric Authority Revenue Bonds (Bulk Power Supply--
Scherer 4-1-A), 6.75% due 10/01/2000 (e) 1,076
AAA Aaa 3,250 Jacksonville, Florida, Excise Taxes Revenue Refunding Bonds, 6.50% due
10/01/2013 (a) 3,262
AAA Aaa 2,500 Jupiter, Florida, Sales Tax, Revenue Refunding Bonds, 6.375% due 9/01/2020 (a) 2,443
AAA Aaa 4,000 Kissimmee, Florida, Utility Authority Electric Systems, Revenue Refunding and
Improvement Bonds, 5.25% due 10/01/2018 (b) 3,272
AAA Aaa 3,000 Marion County, Florida, Hospital District Revenue Refunding Bonds (Monroe
Regional Medical Center), 6.25% due 10/01/2012 (b) 2,924
A1 VMIG1 4,200 Martin County, Florida, PCR, Refunding (Florida Power and Light Company
Project), VRDN, 3.65% due 9/01/2024 (f) 4,200
AAA Aaa 2,515 North Miami Beach, Florida, UT, 6.30% due 2/01/2024 (b) 2,433
AAA Aaa 4,300 North Miami, Florida, Health Facilities Authority Revenue Bonds (Bon Secours
Health Systems Project), 6% due 8/15/2027 (c) 3,928
<PAGE>
AAA Aaa 5,000 North Port, Florida, Utility Revenue Bonds, 6.25% due 10/01/2022 (b) 4,802
AAA Aaa 5,300 Orange County, Florida, Capital Improvement Revenue Refunding Bonds, 6% due
10/01/2022 (a) 4,915
AAA Aaa 550 Orange County, Florida, Sales Tax Revenue Bonds, 6.125% due 1/01/2000 (b)(e) 575
Orange County, Florida, Tourist Development Tax Revenue Bonds:
AAA Aaa 1,000 Refunding, Series A, 6.50% due 10/01/2010 (a) 1,004
AAA Aaa 7,815 Series B, 6.50% due 10/01/2019 (a) 7,748
AAA Aaa 300 Series B, 6% due 10/01/2024 (d) 278
AAA Aaa 3,550 Orange County, Florida, Water and Wastewater Revenue Refunding Bonds, 6.25% due
10/01/2017 (a) 3,432
AA- Aaa 1,440 Orlando, Florida, Utilities Commission, Water and Electric Revenue Bonds,
Series A, 6.50% due 10/01/2001 (e) 1,533
</TABLE>
<TABLE>
SCHEDULE OF INVESTMENTS (concluded) (in Thousands)
<CAPTION>
S&P Moody's Face Value
Ratings Ratings Amount Issue (Note 1a)
Florida (concluded)
<S> <S> <C> <S> <C>
AAA Aaa $ 4,785 Osceola County, Florida, Transportation Revenue Bonds (Osceola Parkway Project),
6.10% due 4/01/2017 (d) $ 4,544
AAA Aaa 2,000 Palm Beach County, Florida, Solid Waste Authority, Revenue and Refunding
Improvement Bonds, 6.25% due 12/01/2008 (d) 1,993
NR* VMIG1 3,500 Palm Beach County, Florida, Water and Sewer Revenue Bonds, VRDN, 3.70% due
10/01/2011 (f) 3,500
A1 VMIG1 1,300 Pinellas County, Florida, Health Facilities Authority, Revenue Refunding Bonds
(Pooled Hospital Loan Project), DATES, 3.70% due 12/01/2015 (f) 1,300
AAA Aaa 3,350 Reedy Creek, Florida, Improvement District, Florida Utility Revenue Bonds,
Series 1991--1, 6.50% due 10/01/2001 (d)(e) 3,544
A1 VMIG1 1,790 Saint Lucie County, Florida, PCR, Refunding (Florida Power and Light Company
Project), VRDN, 3.65% due 1/01/2026 (f) 1,790
AAA Aaa 4,500 South Broward, Florida, Hospital District Revenue Bonds, Linked SAVRS, RIB,
6.611% due 5/01/2021 (a)(j) 4,478
<PAGE>
AAA Aaa 1,500 Tampa, Florida, Water and Sewer Revenue Refunding Bonds, Series A, 6% due
10/01/2017 (b) 1,408
Total Investments (Cost--$180,173)--102.1% 178,023
Liabilities in Excess of Other Assets--(2.1%) (3,582)
--------
Net Assets--100.0% $174,441
========
<FN>
*Not Rated.
(a)AMBAC Insured.
(b)FGIC Insured.
(c)FSA Insured.
(d)MBIA Insured.
(e)Prerefunded.
(f)The interest rate is subject to change periodically based upon
prevailing market rates. The interest rate shown is the rate in
effect at October 31, 1994.
(g)FNMA Collateralized.
(h)GNMA Collateralized.
(i)Escrowed to Maturity.
(j)The interest rate is subject to change periodically and inversely
based upon prevailing market rates. The interest rate shown is the
rate in effect at October 31, 1994.
The ratings of issues shown have not been audited by Deloitte & Touche LLP.
See Notes to Financial Statements.
</TABLE>
FINANCIAL INFORMATION
<TABLE>
Statement of Assets, Liabilities and Capital as of October 31, 1994
<CAPTION>
<S> <S> <C> <C>
Assets: Investments, at value (identified cost--$180,172,601)(Note 1a) $178,023,386
Cash 53,984
Interest receivable 2,103,019
Deferred organization expense (Note 1e) 23,611
Prepaid expenses and other assets 72,768
------------
Total assets 180,276,768
------------
<PAGE>
Liabilities: Payables:
Securities purchased $ 5,403,744
Dividends to shareholders (Note 1g) 269,342
Investment adviser (Note 2) 75,190 5,748,276
------------
Accrued expenses and other liabilities 87,984
------------
Total liabilities 5,836,260
------------
Net Assets: Net assets $174,440,508
============
Capital: Capital Shares (unlimited number of shares of beneficial interest
authorized) (Note 4)
Preferred Shares, par value $.10 per share (1,200 shares of AMPS*
issued and outstanding at $50,000 per share liquidation preference) $ 60,000,000
Common Shares, par value $.10 per share (8,350,463 shares issued
and outstanding) $ 835,046
Paid-in capital in excess of par 116,287,758
Undistributed investment income--net 799,865
Accumulated realized capital losses--net (Note 5) (1,332,946)
Unrealized depreciation on investments--net (2,149,215)
------------
Total--Equivalent to $13.70 net asset value per Common Share
(market price--$11.375) 114,440,508
------------
Total capital $174,440,508
============
<FN>
*Auction Market Preferred Shares.
See Notes to Financial Statements.
</TABLE>
FINANCIAL INFORMATION (continued)
<TABLE>
Statement of Operations
<CAPTION>
For the Year Ended
October 31, 1994
<S> <S> <C> <C>
Investment Interest and amortization of premium and discount earned $ 10,756,887
Income
(Note 1d):
<PAGE>
Expenses: Investment advisory fees (Note 2) $ 935,020
Commission fees (Note 4) 205,624
Professional fees 71,838
Printing and shareholder reports 50,012
Transfer agent fees 36,103
Accounting services (Note 2) 25,616
Trustees' fees and expenses 22,415
Listing fees 16,453
Custodian fees 11,495
Amortization of organization expenses (Note 1e) 7,863
Pricing fees 7,665
Other 15,135
------------
Total expenses 1,405,239
------------
Investment income--net 9,351,648
------------
Realized & Realized loss on investments--net (1,332,942)
Unrealized Change in unrealized appreciation on investments--net (21,049,768)
Loss on ------------
Investments Net Decrease in Net Assets Resulting from Operations $(13,031,062)
- --Net (Notes ============
1d & 3):
See Notes to Financial Statements.
</TABLE>
FINANCIAL INFORMATION (continued)
<TABLE>
Statements of Changes in Net Assets
<CAPTION>
For the Year Ended
October 31,
Increase (Decrease) in Net Assets: 1994 1993
<S> <S> <C> <C>
Operations: Investment income--net $ 9,351,648 $ 9,303,756
Realized gain (loss) on investments--net (1,332,942) 1,551,783
Change in unrealized appreciation on investments--net (21,049,768) 18,900,553
------------ ------------
Net increase (decrease) in net assets resulting from operations (13,031,062) 29,756,092
------------ ------------
<PAGE>
Dividends & Investment income--net:
Distributions Common Shares (7,555,066) (7,060,303)
to Shareholders Preferred Shares (1,651,536) (1,588,634)
(Note 1g): Realized gain on investments--net:
Common Shares (1,286,814) --
Preferred Shares (264,972) --
------------ ------------
Net decrease in net assets resulting from dividends and distributions
to shareholders (10,758,388) (8,648,937)
------------ ------------
Capital Share Proceeds from issuance of Preferred Shares -- 60,000,000
Transactions Value of shares issued to Common Shareholders in reinvestment of
(Notes 1e & 4): dividends and distributions 332,295 1,765,503
Offering and underwriting costs resulting from issuance of Preferred
Shares (10,500) (1,163,934)
------------ ------------
Net increase in net assets derived from capital share transactions 321,795 60,601,569
------------ ------------
Net Assets: Total increase (decrease) in net assets (23,467,655) 81,708,724
Beginning of year 197,908,163 116,199,439
------------ ------------
End of year* $174,440,508 $197,908,163
============ ============
*Undistributed investment income--net $ 799,865 $ 654,819
============ ============
See Notes to Financial Statements.
</TABLE>
FINANCIAL INFORMATION (concluded)
<PAGE>
<TABLE>
Financial Highlights
<CAPTION>
For the
Period
The following per share data and ratios have been derived October 30,
from information provided in the financial statements. For the Year Ended 1992++ to
October 31, October 31,
Increase (Decrease) in Net Asset Value: 1994 1993 1992
<S> <S> <C> <C> <C>
Per Share Net asset value, beginning of period $ 16.56 $ 14.14 $ 14.18
Operating --------- --------- ---------
Performance: Investment income--net 1.13 1.12 --
Realized and unrealized gain (loss) on investments--net (2.70) 2.48 --
--------- --------- ---------
Total from investment operations (1.57) 3.60 --
--------- --------- ---------
Less dividends and distributions to Common Shareholders:
Investment income--net (.91) (.85) --
Realized gain on investments--net (.15) -- --
--------- --------- ---------
Total dividends and distributions (1.06) (.85) --
--------- --------- ---------
Capital charge resulting from issuance of Common Shares -- -- (.04)
--------- --------- ---------
Effect of Preferred Share activity++++:
Dividends and distributions to Preferred Shareholders:
Investment income--net (.20) (.19) --
Realized gain on investments--net (.03) -- --
Capital charge resulting from issuance of Preferred Shares -- (.14) --
--------- --------- ---------
Total effect of Preferred Share activity (.23) (.33) --
--------- --------- ---------
Net asset value, end of period $ 13.70 $ 16.56 $ 14.14
========= ========= =========
Market price per share, end of period $ 11.375 $ 16.875 $ 15.00
========= ========= =========
Total Investment Based on market price per share (27.46%) 18.78% 0.00%+++
Return:** ========= ========= =========
Based on net asset value per share (10.98%) 23.65% (0.28%)+++
========= ========= =========
Ratios to Expenses, net of reimbursement .75% .66% --%*
Average Net ========= ========= =========
Assets:*** Expenses .75% .72% --%*
========= ========= =========
Investment income--net 4.99% 5.09% --%*
========= ========= =========
<PAGE>
Supplemental Net assets, net of Preferred Shares, end of period (in thousands) $ 114,441 $ 137,908 $ 116,199
Data: ========= ========= =========
Preferred Shares outstanding, at end of period (in thousands) $ 60,000 $ 60,000 $ --
========= ========= =========
Portfolio turnover 51.81% 18.51% 0.00%
========= ========= =========
Dividends Per Investment income--net $ 1,376 $ 1,324 $ --
Share On
Preferred Shares
Outstanding:
<FN>
*Annualized.
**Total investment returns based on market value, which can be
significantly greater or lesser than the net asset value, may
result in substantially different returns. Total investment
returns exclude the effects of sales loads.
***Do not reflect the effect of dividends to Preferred Shareholders.
++Commencement of Operations.
++++The Fund's Preferred Shares were issued on November 19, 1992.
+++Aggregate total investment return.
See Notes to Financial Statements.
</TABLE>
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
MuniYield Florida Insured Fund (the "Fund") is registered under the
Investment Company Act of 1940 as a non-diversified, closed-end
management investment company. The Fund determines and makes
available for publication the net asset value of its Common Shares
on a weekly basis. The Fund's Common Shares are listed on the New
York Stock Exchange under the symbol MFT. The following is a summary
of significant accounting policies followed by the Fund.
(a) Valuation of investments--Municipal bonds are traded primarily
in the over-the-counter markets and are valued at the most recent
bid price or yield equivalent as obtained by the Fund's pricing
service from dealers that make markets in such securities. Finan-
cial futures contracts, which are traded on exchanges, are valued at
their closing prices as of the close of such exchanges. Options,
which are traded on exchanges, are valued at their last sale price
as of the close of such exchanges or, lacking any sales, at the last
available bid price. Securities with remaining maturities of sixty
days or less are valued at amortized cost, which approximates market
value. Securities for which market quotations are not readily
available are valued at their fair value as determined in good faith
by or under the direction of the Board of Trustees of the Fund.
<PAGE>
(b) Financial futures contracts--The Fund may purchase or sell
interest rate futures contracts and options on such futures
contracts for the purpose of hedging the market risk on existing
securities or the intended purchase of securities. Futures contracts
are contracts for delayed delivery of securities at a specific
future date and at a specific price or yield. Upon entering into a
contract, the Fund deposits and maintains as collateral such initial
margin as required by the exchange on which the transaction is
effected. Pursuant to the contract, the Fund agrees to receive from
or pay to the broker an amount of cash equal to the daily
fluctuation in value of the contract. Such receipts or payments are
known as variation margin and are recorded by the Fund as unrealized
gains or losses. When the contract is closed, the Fund records a
realized gain or loss equal to the difference between the value of
the contract at the time it was opened and the value at the time it
was closed.
(c) Income taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its
taxable income to its shareholders. Therefore, no Federal income tax
provision is required.
(d) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are entered
into (the trade dates). Interest income is recognized on the accrual
basis. Discounts and market premiums are amortized into interest
income. Realized gains and losses on security transactions are
determined on the identified cost basis.
(e) Deferred organization expenses and offering expenses--Deferred
organization expenses are amortized on a straight-line basis over a
five-year period. Direct expenses relating to the public offering of
the Common and Preferred Shares were charged to capital at the time
of issuance.
(f) Non-income producing investments--Written and purchased options
are non-income producing investments.
(g) Dividends and distributions--Dividends from net investment
income are declared and paid monthly. Distributions of capital gains
are recorded on the ex-dividend dates.
<PAGE>
2. Investment Advisory Agreement and
Transactions with Affiliates:
The Fund has entered into an Investment Advisory Agreement with Fund
Asset Management, L.P. ("FAM"). Effective January 1, 1994, the
investment advisory business of FAM was reorganized from a
corporation to a limited partnership. Both prior to and after the
reorganization, ultimate control of FAM was vested with Merrill
Lynch & Co., Inc. ("ML & Co."). The general partner of FAM is
Princeton Services, Inc. ("PSI"), an indirect wholly-owned
subsidiary of ML & Co. The limited partners are ML & Co. and Fund
Asset Management, Inc. ("FAMI"), which is also an indirect wholly-
owned subsidiary of ML & Co.
FAM is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operations of the Fund. For such
services, the Fund pays a monthly fee at an annual rate of 0.50% of
the Fund's average weekly net assets.
NOTES TO FINANCIAL STATEMENTS (concluded)
Accounting services are provided to the Fund by FAM at cost.
Certain officers and/or trustees of the Fund are officers and/or
directors of FAM, FAMI, PSI, Merrill Lynch, Pierce, Fenner & Smith
Inc. ("MLPF&S"), and/or ML & Co.
3. Investments:
Purchases and sales of investments, excluding short-term securities,
for the year ended October 31, 1994 were $90,799,617 and
$107,321,729, respectively.
Net realized and unrealized gains (losses) as of October 31, 1994
were as follows:
Realized
Gains Unrealized
(Losses) Losses
Long-term investments $(1,518,895) $(2,149,215)
Financial futures contracts 185,953 --
----------- -----------
Total $(1,332,942) $(2,149,215)
=========== ===========
<PAGE>
As of October 31, 1994, net unrealized depreciation for Federal
income tax purposes aggregated $2,149,215, of which $1,267,587
related to appreciated securities and $3,416,802 related to
depreciated securities. The aggregate cost of investments at October
31, 1994 for Federal income tax purposes was $180,172,601.
4. Capital Share Transactions:
The Fund is authorized to issue an unlimited number of capital
shares, including Preferred Shares, par value $.10 per share, all of
which were initially classified as Common Shares. The Board of
Trustees is authorized, however, to reclassify any unissued shares
of capital without approval of the holders of Common Shares.
Common Shares
For the year ended October 31, 1994, shares issued and outstanding
increased by 21,369 to 8,350,463 as a result of dividend
reinvestment. At October 31, 1994, total paid-in capital amounted to
$117,122,804.
Preferred Shares
Auction Market Preferred Shares ("AMPS") are Preferred Shares of the
Fund that entitle their holders to receive cash dividends at an
annual rate that may vary for the successive dividend periods. The
yield in effect at October 31, 1994 was 3.15%.
For the year ended October 31, 1994, there were 1,200 AMPS shares
authorized, issued and outstanding with a liquidation preference of
$50,000 per share, plus accumulated and unpaid dividends of
$160,044.
Effective December 1, 1994, as a result of a two for one stock
split, there will be 2,400 AMPS shares with a liquidation preference
of $25,000 per share.
The Fund pays commissions to certain broker-dealers at the end of
each auction at an annual rate ranging from 0.25% to 0.375%,
calculated on the proceeds of each auction. For the year ended
October 31, 1994, MLPF&S, an affiliate of FAMI, earned $149,356
as commissions.
5. Capital Loss Carryforward:
At October 31, 1994, the Fund had a capital loss carryforward of
approximately $1,316,000, all of which expires in 2002. This amount
will be available to offset like amounts of any future taxable
gains.
<PAGE>
6. Subsequent Event:
On November 8, 1994, the Fund's Board of Trustees declared an
ordinary income dividend to Common shareholders in the amount of
$0.073254 per share, payable on November 29, 1994 to shareholders of
record as of November 18, 1994.
<AUDIT-REPORT>
INDEPENDENT AUDITORS' REPORT
The Board of Trustees and Shareholders of
MuniYield Florida Insured Fund:
We have audited the accompanying statement of assets, liabilities
and capital, including the schedule of investments, of MuniYield
Florida Insured Fund as of October 31, 1994, the related statements
of operations for the year then ended and changes in net assets for
each of the years in the two-year period then ended and the
financial highlights for each of the years in the two-year period
then ended and the period October 30, 1992 (commencement of
operations) to October 31, 1992. These financial statements and the
financial highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion on these
financial statements and the financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements and the financial highlights are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements.
Our procedures included confirmation of securities owned at October
31, 1994 by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, such financial statements and financial highlights
present fairly, in all material respects, the financial position of
MuniYield Florida Insured Fund as of October 31, 1994, the results
of its operations, the changes in its net assets, and the financial
highlights for the respective stated periods in conformity with
generally accepted accounting principles.
Deloitte & Touche LLP
Princeton, New Jersey
December 6, 1994
</AUDIT-REPORT>
<PAGE>
IMPORTANT TAX INFORMATION (unaudited)
All of the net investment income distributions paid monthly by
MuniYield Florida Insured Fund during its taxable year ended October
31, 1994 qualify as tax-exempt interest dividends for Federal income
tax purposes.
Additionally, the following table summarizes the per share capital
gains distributions paid by the Fund during the year:
<TABLE>
Payable Short-Term Long-Term
Date Capital Gains Capital Gains
<S> <C> <C> <C>
Common Stock Shareholders 12/30/93 $ 0.154293 --
Preferred Stock Shareholders 12/01/93 $183.71 --
1/03/94 $ 37.10 --
Please retain this information for your records.
</TABLE>
PER SHARE INFORMATION (unaudited)
<TABLE>
Per Share Selected Quarterly Financial Data*
<CAPTION>
Net Realized Unrealized Dividends/Distributions
Investment Gains Gains Net Investment Income Capital Gains
For the Period Income (Losses) (Losses) Common Preferred Common Preferred
<S> <C> <C> <C> <C> <C> <C> <C>
October 30, 1992++ to January 31, 1993 $.26 $ .05 $ .71 $.14 $.04 -- --
February 1, 1993 to April 30, 1993 .30 .05 .63 .24 .06 -- --
May 1, 1993 to July 31, 1993 .28 .10 .14 .23 .05 -- --
August 1, 1993 to October 31, 1993 .28 -- .80 .24 .04 -- --
November 1, 1993 to January 31, 1994 .29 .16 .02 .24 .03 $.15 $.03
February 1, 1994 to April 30, 1994 .27 .08 (2.13) .22 .05 -- --
May 1, 1994 to July 31, 1994 .28 (.06) .29 .23 .06 -- --
August 1, 1994 to October 31, 1994 .29 (.35) (.71) .22 .06 -- --
<PAGE>
<CAPTION>
Net Asset Value Market Price**
For the Period High Low High Low Volume***
<S> <C> <C> <C> <C> <C>
October 30, 1992++ to January 31, 1993 $14.83 $14.14 $15.50 $14.375 494
February 1, 1993 to April 30, 1993 15.99 14.82 16.125 15.00 604
May 1, 1993 to July 31, 1993 16.00 15.44 15.375 14.875 776
August 1, 1993 to October 31, 1993 16.90 15.76 16.875 15.625 840
November 1, 1993 to January 31, 1994 16.57 15.99 16.75 15.75 662
February 1, 1994 to April 30, 1994 16.51 13.88 16.50 13.75 778
May 1, 1994 to July 31, 1994 15.23 14.14 14.50 13.25 748
August 1, 1994 to October 31, 1994 14.78 13.70 13.875 11.125 895
<FN>
*Calculations are based upon Common Shares outstanding at the end of
each period.
**As reported in the consolidated transaction reporting system.
***In thousands.
++Commencement of Operations.
</TABLE>
OFFICERS AND TRUSTEES
Arthur Zeikel, President and Trustee
Donald Cecil, Trustee
M. Colyer Crum, Trustee
Edward H. Meyer, Trustee
Jack B. Sunderland, Trustee
J. Thomas Touchton, Trustee
Terry K. Glenn, Executive Vice President
Donald C. Burke, Vice President
Vincent R. Giordano, Vice President
Kenneth A. Jacob, Vice President
Gerald M. Richard, Treasurer
Mark B. Goldfus, Secretary
Custodian
The Bank of New York
90 Washington Street
New York, New York 10286
Transfer Agents
Common Shares:
The Bank of New York
101 Barclay Street
New York, New York 10286
Preferred Shares:
IBJ Schroder Bank & Trust Co.
One State Street
New York, New York 10004
NYSE Symbol
MFT
<PAGE>
