<PAGE>
National Limited Maturity Municipals Portfolio as of March 31, 1997
PORTFOLIO OF INVESTMENTS
Tax-Exempt Investments -- 100.00%
<TABLE>
<CAPTION>
Ratings (Unaudited)
- ------------------- Principal
Amount
Standard (000
Moody's & Poor's omitted) Security Value
- -------------------------------------------------------------------------
Cogeneration -- 1.31%
- -------------------------------------------------------------------------
<S> <C> <C> <C> <C>
NR A+ $1,250 New Jersey Economic
Development Authority,
Vineland Cogeneration
Limited Partnership
Project (AMT), 7.875%,
6/1/19 $ 1,343,175
- -------------------------------------------------------------------------
$ 1,343,175
- -------------------------------------------------------------------------
Education -- 7.24%
- -------------------------------------------------------------------------
NR NR $1,500 Arizona Educational Loan
Marketing Corp., (AMT),
6.00%, 9/1/01 $ 1,556,310
NR NR 1,900 Arizona Educational Loan
Marketing Corp., (AMT),
6.25%, 6/1/06 1,950,426
A NR 1,000 Arizona Student Loan
Acquisition Authority,
(AMT), 7.625%, 5/1/10 1,080,430
A1 NR 1,730 Massachusetts Health and
Educational Facilities
Authority (Tufts
University), 7.40%, 8/1/18 1,828,420
Ba1 NR 1,000 New Hampshire Higher
Education and Health
Facilities Authority
(Colby-Sawyer College),
7.20%, 6/1/12 1,012,640
- -------------------------------------------------------------------------
$ 7,428,226
- -------------------------------------------------------------------------
Escrowed / Prerefunded -- 1.73%
- -------------------------------------------------------------------------
Aaa AAA $1,500 Grand Ledge, MI, Public
School District, (MBIA),
Prerefunded to 5/1/04,
7.875%, 5/1/11 $ 1,781,580
- -------------------------------------------------------------------------
$ 1,781,580
- -------------------------------------------------------------------------
General Obligations -- 14.82%
- -------------------------------------------------------------------------
Baa BBB $5,000 City of Detroit, Michigan,
6.50%, 4/1/02(1) $ 5,262,799
Ba1 BBB 1,000 Cleveland, OH, City
School District, 6.50%,
6/15/97 1,001,290
NR NR 1,800 Pennsylvania Economic
Development Authority,
Resource Recovery,
(Northampton Project)
(AMT), 6.75%, 1/1/07 1,821,006
Aa3 AA- 3,800 State of Connecticut,
5.375%, 5/15/12(2) 3,738,022
Baa NR 3,270 Youngstown, OH, County
School District, 6.40%,
7/1/00 3,391,055
- -------------------------------------------------------------------------
$ 15,214,172
- -------------------------------------------------------------------------
Hospitals -- 2.25%
- -------------------------------------------------------------------------
Aa3 AA- $2,500 Greenville, SC, Hospital
System (Board of
Trustees), 5.25%, 5/1/17 $ 2,311,500
- -------------------------------------------------------------------------
$ 2,311,500
- -------------------------------------------------------------------------
Housing -- 7.70%
- -------------------------------------------------------------------------
A NR $1,005 Illinois Development
Finance Authority, Elderly
Housing, (Mattoon Tower -
Section 8), 6.35%, 7/1/10 $ 1,013,854
Baa NR 1,125 Illinois Development
Finance Authority, Elderly
Housing, (Rome Meadows),
6.40%, 2/1/03 1,138,489
Baa NR 1,145 Illinois Development
Finance Authority, Elderly
Housing, (Rome Meadows),
6.65%, 2/1/06 1,160,103
NR A 3,500 Maricopa County, AZ,
Industrial Development
Authority, Multifamily,
6.45%, 1/1/17 3,568,915
NR NR 1,025 Maricopa County, AZ,
Industrial Development
Authority, Multifamily,
7.876%, 1/1/11 1,022,427
- -------------------------------------------------------------------------
$ 7,903,788
- -------------------------------------------------------------------------
Industrial Development Revenue / Pollution Control Revenue
- -- 13.50%
- -------------------------------------------------------------------------
NR NR $ 690 Austin, TX (Cargoport
Development LLC) (AMT),
7.50%, 10/1/07 $ 691,387
NR NR 455 Austin, TX (Cargoport
Development LLC) (AMT),
8.30%, 10/1/21 459,696
A3 A- 2,450 Columbus, NC
(International Paper Co.),
5.80%, 12/1/16 2,349,991
NR NR 3,500 Jackson, TN, Solid Waste
Disposal (Owens-Corning
Fiberglass), (AMT), 6.25%,
3/31/04(1) 3,532,655
NR NR 500 Kimball, NE, Economic
Development Authority,
(Clean Harbors Inc.)
(AMT), 10.75%, 9/1/26 503,850
NR NR 1,000 New Jersey Economic
Development Authority,
8.00%, 10/1/07 994,900
NR NR 1,000 New Jersey Economic
Development Authority
(Holt Hauling and
Warehouse), 7.80%, 12/15/16 997,920
</TABLE>
See notes to financial statements
13
<PAGE>
National Limited Maturity Municipals Portfolio as of March 31, 1997
PORTFOLIO OF INVESTMENTS CONT'D
<TABLE>
<CAPTION>
Ratings (Unaudited)
- ------------------ Principal
Amount
Standard (000
Moody's & Poor's omitted) Security Value
- ----------------------------------------------------------------------------
Industrial Development Revenue /
Pollution Control Revenue (continued)
- ----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
NR BBB $2,000 Pennsylvania Economic
Development Authority,
Resource Recovery, (AMT),
(Colver Project), 7.05%,
12/1/10 $ 2,117,520
NR NR 1,455 Santa Fe, NM (Crow Hobbs),
8.25%, 9/1/05 1,461,475
NR NR 750 State of Ohio, Solid Waste
(Republic Engineered
Steel, Inc.) (AMT), 9.00%,
6/1/21 754,973
- ----------------------------------------------------------------------------
$ 13,864,367
- ----------------------------------------------------------------------------
Insured Electric Utilities -- 2.87%
- ----------------------------------------------------------------------------
Aaa AAA $3,000 Municipal Electric
Authority Georgia (AMBAC),
5.375%, 1/1/10 $ 2,949,510
- ----------------------------------------------------------------------------
$ 2,949,510
- ----------------------------------------------------------------------------
Insured General Obligations -- 3.80%
- ----------------------------------------------------------------------------
Aaa AAA $2,000 Commonwealth of
Massachusetts (FGIC),
5.125%, 11/1/15 $ 1,855,520
Aaa AAA 2,250 Commonwealth of
Massachusetts (MBIA),
4.875%, 10/1/13 2,043,090
- ----------------------------------------------------------------------------
$ 3,898,610
- ----------------------------------------------------------------------------
Insured Housing -- 4.09%
- ----------------------------------------------------------------------------
Aaa AAA $2,115 Massachusetts Housing
Finance Authority
(Harborpoint Development),
(AMBAC), (AMT), 6.20%,
12/1/10 $ 2,174,855
Aaa AAA 2,000 Massachusetts Housing
Finance Authority, (MBIA),
6.10%, 7/1/15 2,027,140
- ----------------------------------------------------------------------------
$ 4,201,995
- ----------------------------------------------------------------------------
Insured Special Tax Revenue -- 6.11%
- ----------------------------------------------------------------------------
Aaa AAA $3,000 Los Angeles County
California Public Works
(MBIA), 5.25%, 9/1/12 $ 2,880,420
Aaa AAA 3,500 Pennsylvania
Intergovernmental
Cooperative Authority
(FGIC), 5.50%, 6/15/16 3,388,840
- ----------------------------------------------------------------------------
$ 6,269,260
- ----------------------------------------------------------------------------
Insured Transportation -- 5.06%
- ----------------------------------------------------------------------------
Aaa AAA $3,000 Chicago, IL (O'Hare
International Airport)
(AMBAC), 5.50%, 1/1/16 $ 2,840,280
Aaa AAA $2,270 Texas Turnpike Authority
(FGIC), 6.00%, 1/1/03/(3)/ $ 2,358,621
- ----------------------------------------------------------------------------
$ 5,198,901
- ----------------------------------------------------------------------------
Life Care -- 6.59%
- ----------------------------------------------------------------------------
Baa2 BBB $ 805 Colorado Health Facilities
Authority, (Rocky Mountain
Adventist), 6.00%, 2/1/98 $ 809,750
NR A+ 2,000 Illinois Health Facilities
Authority, 6.125%, 8/15/10 1,943,380
Baa3 BB 1,570 Massachusetts Health and
Educational Finance
Authority (Milford
Whitinsville Hospital),
7.125%, 7/15/02 1,586,108
Baa3 BBB- 1,915 Richardson, TX, Hospital
Authority, (Richardson
Medical Center), 6.50%,
12/1/12 1,940,699
NR NR 475 Vermont State Industrial
Development Authority,
(Wake Robins), 8.00%,
4/1/99 482,847
- ----------------------------------------------------------------------------
$ 6,762,784
- ----------------------------------------------------------------------------
Nursing Homes -- 9.09%
- ----------------------------------------------------------------------------
NR NR $1,105 Arizona Health Facilities
Authority Assisted Living
Facilites, (Mesa), 7.625%,
1/1/06 $ 1,093,795
NR A+ 4,000 California Statewide
Nursing Homes, (Pacific
Homes), 5.90%, 4/1/09 4,034,239
NR NR 1,000 Fairfield, OH, Economic
Development Revenue
(Beverly Enterprises),
8.50%, 1/1/03 1,080,490
NR NR 1,500 Massachusetts Industrial
Finance Agency, Health
Care Facilities (Age
Institute of
Massachusetts), 7.60%,
11/1/05 1,499,385
NR NR 1,550 Saint Tammany Public Trust
Finance Authority,
Louisiana (Christwood),
8.75%, 11/15/05 1,621,176
- ----------------------------------------------------------------------------
$ 9,329,085
- ----------------------------------------------------------------------------
Pooled Loans -- 0.98%
- ----------------------------------------------------------------------------
A NR $1,000 Arkansas State Student
Loan Authority (AMT),
6.25%, 6/1/10 $ 1,005,080
- ----------------------------------------------------------------------------
$ 1,005,080
- ----------------------------------------------------------------------------
</TABLE>
See notes to financial statements
14
<PAGE>
National Limited Maturity Municipals Portforlio as of March 31, 1997
PORTFOLIO OF INVESTMENTS CONT'D
<TABLE>
<CAPTION>
Ratings (Unaudited)
- ------------------- Principal
Amount
Standard (000 Value
Moody's & Poor's omitted) Security
- --------------------------------------------------------------------------------
Solid Waste -- 1.13%
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
NR BBB- $1,120 New Jersey Economic
Development Authority,
Heating and Cooling
(Trigen-Trenton), (AMT),
6.10%, 12/1/05 $ 1,158,786
- --------------------------------------------------------------------------------
$ 1,158,786
- --------------------------------------------------------------------------------
Transportation -- 11.73%
- --------------------------------------------------------------------------------
Baa BBB $2,000 Denver, CO City and County
Airport, (AMT), 7.00%,
11/15/99 $ 2,108,060
NR NR 1,225 Eagle County, CO, Airport
Terminal Corp. (American
Airlines), (AMT), 6.75%,
5/1/06 1,252,403
NR NR 1,180 Los Angeles, CA, Regional
Airport Improvement
Corporate Lease,
(TransWorld Airlines),
6.125%, 5/15/00 1,156,164
A1 A+ 3,000 Massachusetts State
Turnpike Authority, 5.00%,
1/1/20 2,662,290
Aa A+ 3,000 Triborough Bridge and
Tunnel Authority, 5.30%,
1/1/17 2,823,030
Aa2 AA 2,000 Wisconsin Housing and
Economic Development
Authority, 6.45%, 9/1/27 2,038,700
- --------------------------------------------------------------------------------
$ 12,040,647
- --------------------------------------------------------------------------------
Total Tax-Exempt Investments -- 100%
(identified cost, $101,840,272) $ 102,661,466
- --------------------------------------------------------------------------------
</TABLE>
/(1)/ Security has been segregated to cover when-issued securities.
/(2)/ Security has been segregated to cover margin requirements on open
financial futures contracts.
/(3)/ When-issued security.
AMT - Interest earned from these securities may be considered a tax
preference item for purposes of the Federal Alternative Minimum Tax.
The Portfolio invests primarily in debt securities issued by municipalities. The
ability of the issuers of the debt securities to meet their obligations may be
affected by economic developments in a specific industry or municipality. In
order to reduce the risk of such economic developments, at March 31, 1997, 23.7%
of the securities in the portfolio of investments are backed by bond insurance
of various financial institutions and financial guaranty assurance agencies. The
aggregate percentage insured by financial institutions ranged from 7.4% to 8.5%
of total investments.
At March 31, 1997 the concentration of the Portfolio's investments in
the various states, determined as a percentage of total investments is
as follows:
<TABLE>
<S> <C>
Massachusetts 15%
Arizona 10%
Others, representing less than 10% individually 75%
</TABLE>
See notes to financial statements
15
<PAGE>
National Limited Maturity Municipals Portfolio as of March 31, 1997
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
<TABLE>
<CAPTION>
As of March 31, 1997
Assets
- --------------------------------------------------------------------------
<S> <C>
Investments, at value (Note 1A)
(identified cost, $101,840,272) $102,661,466
Cash 704
Receivable for investments sold 1,594,030
Interest receivable 2,142,095
Receivable for variation margin on open financial
futures contracts (Note 1E) 7,633
Deferred organization expenses (Note 1D) 2,687
- --------------------------------------------------------------------------
Total assets $106,408,615
- --------------------------------------------------------------------------
<CAPTION>
Liabilities
- --------------------------------------------------------------------------
Payable for when-issued securities (Note 1G) $ 2,325,933
Demand note payable (Note 3) 1,569,000
Payable to affiliate - Trustees' fees (Note 2) 2,256
Accrued expenses 7,910
- --------------------------------------------------------------------------
Total liabilities $ 3,905,099
- --------------------------------------------------------------------------
Net Assets applicable to investors' interest in
Portfolio $102,503,516
- --------------------------------------------------------------------------
<CAPTION>
Sources of Net Assets
- --------------------------------------------------------------------------
Net proceeds from capital contributions
and withdrawals $101,543,559
Net unrealized appreciation of investments and
financial futures contracts (computed on the
basis of identified cost) 959,957
- --------------------------------------------------------------------------
Total $102,503,516
- --------------------------------------------------------------------------
<CAPTION>
Statement of Operations
For the Year Ended
March 31, 1997
Investment Income
- --------------------------------------------------------------------------
Interest income $ 7,212,252
- --------------------------------------------------------------------------
Total income $ 7,212,252
- --------------------------------------------------------------------------
<CAPTION>
Expenses
- --------------------------------------------------------------------------
Investment adviser fee (Note 2) $ 575,268
Compensation of Trustees not members of the
Investment Adviser's organization (Note 2) 8,729
Custodian fee 66,720
Legal and accounting services 24,420
Bond pricing 10,848
Amortization of organization expenses (Note 1D) 2,467
Miscellaneous 31,222
- --------------------------------------------------------------------------
Total expenses $ 719,674
- --------------------------------------------------------------------------
Deduct --
Reduction of custodian fee (Note 1H) $ 26,132
- --------------------------------------------------------------------------
Total expense reductions $ 26,132
- --------------------------------------------------------------------------
Net expenses $ 693,542
- --------------------------------------------------------------------------
Net investment income $ 6,518,710
- --------------------------------------------------------------------------
<CAPTION>
Realized and Unrealized
Gain (Loss) on Investments
- --------------------------------------------------------------------------
Net realized gain (loss) --
Investment transactions (identified cost basis) $ 108,501
Financial futures contracts (1,238,242)
- --------------------------------------------------------------------------
Net realized loss on investments $ (1,129,741)
- --------------------------------------------------------------------------
Change in unrealized appreciation (depreciation) --
Investments $ (288,902)
Financial futures contracts 138,763
- --------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation) $ (150,139)
- --------------------------------------------------------------------------
Net realized and unrealized loss on investments $ (1,279,880)
- --------------------------------------------------------------------------
Net increase in net assets from operations $ 5,238,830
- --------------------------------------------------------------------------
</TABLE>
See notes to financial statements
16
<PAGE>
National Limited Maturity Municipals Portfolio as of March 31, 1997
FINANCIAL STATEMENTS CONT'D
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
Increase (Decrease) Year Ended Year Ended
in Net Assets March 31, 1997 March 31, 1996
- --------------------------------------------------------------------------------
<S> <C> <C>
From operations --
Net investment income $ 6,518,710 $ 7,759,487
Net realized gain (loss)
on investments (1,129,741) 1,454,592
Net change in unrealized
appreciation
(depreciation) (150,139) (359,938)
- --------------------------------------------------------------------------------
Net increase in net assets
from operations $ 5,238,830 $ 8,854,141
- --------------------------------------------------------------------------------
Capital transactions --
Contributions $ 8,914,088 $ 15,935,762
Withdrawals (46,425,770) (59,634,339)
- --------------------------------------------------------------------------------
Net decrease in net assets
from capital transactions $(37,511,682) $ (43,698,577)
- --------------------------------------------------------------------------------
Net decrease in net assets $(32,272,852) $ (34,844,436)
- --------------------------------------------------------------------------------
Net Assets
- --------------------------------------------------------------------------------
At beginning of year $134,776,368 $ 169,620,804
- --------------------------------------------------------------------------------
At end of year $102,503,516 $ 134,776,368
- --------------------------------------------------------------------------------
</TABLE>
See notes to financial statements
17
<PAGE>
National Limited Maturity Municipals Portfolio as of March 31, 1997
FINANCIAL STATEMENTS CONT'D
Supplementary Data
<TABLE>
<CAPTION>
Year Ended March 31,
-----------------------------------------------------------------
1997 1996 1995 1994*
- -----------------------------------------------------------------------------------------------------------------------
Ratios to average daily net assets
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Expenses (1) 0.60% 0.57% 0.53% 0.52%+
Expenses after custodian fee reduction 0.58% 0.56% -- --
Net investment income 5.45% 5.08% 5.02% 4.74%+
Portfolio Turnover 68% 68% 56% 21%
- -----------------------------------------------------------------------------------------------------------------------
Net assets, end of year (000s omitted) $102,504 $134,776 $169,621 $ 177,842
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>
+ Annualized.
* For the period from the start of business, May 3, 1993, to March 31, 1994.
(1) The expense ratios for the year ended March 31, 1996 and periods thereafter
have been adjusted to reflect a change in reporting requirements. The new
reporting guidelines require the Portfolio to increase its expense ratio by
the effect of any expense offset arrangements with its service providers.
The expense ratios for each of the prior periods have not been adjusted to
reflect this change.
See notes to financial statements
18
<PAGE>
National Limited Maturity Municipals Portfolio as of March 31, 1997
NOTES TO FINANCIAL STATEMENTS
1 Significant Accounting Policies
-----------------------------------------------------------------------------
National Limited Maturity Municipals Portfolio (the Portfolio) seeks to
provide (1) a high level of income exempt from regular federal income tax
and (2) limited principal fluctuation. The Portfolio is registered under the
Investment Company Act of 1940 as a diversified open-end management
investment company which was organized as a trust under the laws of the
State of New York on May 1, 1992. The Declaration of Trust permits the
Trustees to issue interests in the Portfolio. The following is a summary of
significant accounting policies of the Portfolio. The policies are in
conformity with generally accepted accounting principles.
A Investment Valuation -- Municipal bonds are normally valued on the basis
of valuations furnished by a pricing service. Taxable obligations, if any,
for which price quotations are readily available are normally valued at the
mean between the latest bid and asked prices. Futures contracts listed on
the commodity exchanges are valued at closing settlement prices. Short-term
obligations, maturing in sixty days or less, are valued at amortized cost,
which approximates value. Investments for which valuations or market
quotations are unavailable are valued at fair value using methods determined
in good faith by or at the direction of the Trustees.
B Income -- Interest income is determined on the basis of interest accrued,
adjusted for amortization of premium or discount when required for federal
income tax purposes.
C Income Taxes -- The Portfolio is treated as a partnership for federal tax
purposes. No provision is made by the Portfolio for federal or state taxes
on any taxable income of the Portfolio because each investor in the
Portfolio is ultimately responsible for the payment of any taxes. Since some
of the Portfolio's investors are regulated investment companies that invest
all or substantially all of their assets in the Portfolio, the Portfolio
normally must satisfy the applicable source of income and diversification
requirements (under the Internal Revenue Code) in order for its investors to
satisfy them. The Portfolio will allocate at least annually among its
investors each investor's distributive share of the Portfolio's net taxable
(if any) and tax-exempt investment income, net realized capital gains, and
any other items of income, gain, loss, deduction or credit. Interest income
received by the Portfolio on investments in municipal bonds, which is
excludable from gross income under the Internal Revenue Code, will retain
its status as income exempt from federal income tax when allocated to the
Portfolio's investors. The portion of such interest, if any, earned on
private activity bonds issued after August 7, 1986 may be considered a tax
preference item for investors.
D Deferred Organization Expenses -- Costs incurred by the Portfolio in
connection with its organization are being amortized on the straight-line
basis over five years.
E Financial Futures Contracts -- Upon the entering of a financial futures
contract, the Portfolio is required to deposit ("initial margin") either in
cash or securities an amount equal to a certain percentage of the purchase
price indicated in the financial futures contract. Subsequent payments are
made or received by the Portfolio ("margin maintenance") each day, dependent
on the daily fluctuations in the value of the underlying security, and are
recorded for book purposes as unrealized gains or losses by the Portfolio.
The Portfolio's investment in financial futures contracts is designed only
to hedge against anticipated future changes in interest rates. Should
interest rates move unexpectedly, the Portfolio may not achieve the
anticipated benefits of the financial futures contracts and may realize a
loss.
F Options on Financial Futures Contracts -- Upon the purchase of a put
option on a financial futures contract by the Portfolio, the premium paid is
recorded as an investment, the value of which is marked-to-market daily.
When a purchased option expires, a Portfolio will realize a loss in the
amount of the cost of the option. When a Portfolio enters into a closing
sales transaction, the Portfolio will realize a gain or loss depending on
whether the sales proceeds from the closing sales transaction is greater or
less than the cost of the option. When the Portfolio exercises a put option,
settlement is made in cash. The risk associated with purchasing options is
limited to the premium originally paid.
G When-issued and Delayed Delivery Transactions -- The Portfolio may engage
in when-issued and delayed delivery transactions. The Portfolio records
when-issued securities on trade date and maintains security positions such
that sufficient liquid assets will be available to make payments for the
securities purchased. Securities purchased on a when-issued or delayed
delivery basis are marked-to-market daily and begin earning interest on
settlement date.
H Expense Reduction -- Investors Bank & Trust Company (IBT) serves as
custodian of the Portfolio. Pursuant to the custodian agreement, IBT
receives a fee reduced by credits which are determined based on the average
daily cash balances the Portfolio maintains with IBT. All significant credit
balances used to reduce the Portfolio's custodian fees are reported as a
reduction of expenses on the Statement of Operations.
19
<PAGE>
National Limited Maturity Municipals Portfolio as of March 31, 1997
NOTES TO FINANCIAL STATEMENTS CONT'D
I Use of Estimates -- The preparation of the financial statements in
conformity with generally accepted accounting principles requires management
to make estimates and assumptions that affect the reported amounts of assets
and liabilities at the date of the financial statements and the reported
amounts of revenue and expense during the reporting period. Actual results
could differ from those estimates.
J Other -- Investment transactions are accounted for on a trade date basis.
2 Investment Adviser Fee and Other Transactions with Affiliates
-----------------------------------------------------------------------------
The investment adviser fee is earned by Boston Management and Research
(BMR), a wholly-owned subsidiary of Eaton Vance Management (EVM), as
compensation for management and investment advisory services rendered to the
Portfolio. The fee is based upon a percentage of average daily net assets
plus a percentage of gross income (i.e., income other than gains from the
sale of securities). For the year ended March 31, 1997, the fee was
equivalent to 0.48% of the Portfolio's average net assets for such period
and amounted to $575,268. Except as to Trustees of the Portfolio who are not
members of EVM's or BMR's organization, officers and Trustees receive
remuneration for their services to the Portfolio out of such investment
adviser fee. Certain of the officers and Trustees of the Portfolio are
officers and directors/trustees of the above organizations. Trustees of the
Portfolio that are not affiliated with the Investment Adviser may elect to
defer receipt of all or a percentage of their annual fees in accordance with
the terms of the Trustees Deferred Compensation Plan. For the year ended
March 31, 1997, no significant amounts have been deferred.
3 Line of Credit
-----------------------------------------------------------------------------
The Portfolio participates with other portfolios and funds managed by BMR
and EVM in a committed $120 million unsecured line of credit agreement with
a group of banks. The Portfolio may temporarily borrow from the line of
credit to satisfy redemption requests or settle investment transactions.
Interest is charged to each portfolio or fund based on its borrowings at an
amount above the bank's adjusted certificate of deposit rate, eurodollar
rate or federal funds rate. In addition, a fee computed at an annual rate of
0.15% on the daily unused portion of the line of credit is allocated among
the participating portfolios and funds at the end of each quarter. At March
31, 1997, the Portfolio had a balance outstanding pursuant to this line of
credit of $1,569,000. The Portfolio did not have any significant borrowings
or allocated fees during the period.
4 Investments
-----------------------------------------------------------------------------
Purchases and sales of investments, other than U.S. Government securities
and short-term obligations, aggregated $82,251,588 and $116,331,586,
respectively.
5 Federal Income Tax Basis of Investments
-----------------------------------------------------------------------------
The cost and unrealized appreciation/depreciation in value of the
investments owned at March 31, 1997, as computed on a federal income tax
basis, were as follows:
<TABLE>
<S> <C>
Aggregate cost $ 101,840,272
-----------------------------------------------------------------------------
Gross unrealized appreciation $ 1,485,488
Gross unrealized depreciation (664,294)
-----------------------------------------------------------------------------
Net unrealized appreciation $ 821,194
-----------------------------------------------------------------------------
</TABLE>
6 Financial Instruments
-----------------------------------------------------------------------------
The Portfolio regularly trades in financial instruments with off-balance
sheet risk in the normal course of its investing activities to assist in
managing exposure to various market risks. These financial instruments
include written options and futures contracts and may involve, to a varying
degree, elements of risk in excess of the amounts recognized for financial
statement purposes. The notional or contractual amounts of these instruments
represent the investment the Portfolio has in particular classes of
financial instruments and does not necessarily represent the amounts
potentially subject to risk. The measurement of the risks associated with
these instruments is meaningful only when all related and offsetting
transactions are considered. A summary of obligations under these financial
instruments at March 31, 1997 were as follows:
<TABLE>
<CAPTION>
Futures
Contracts Net Unrealized
Expiration Date Contracts Position Appreciation
-----------------------------------------------------------------------------
<S> <C> <C> <C>
6/97 50 U.S. Treasury Bonds Short $ 138,763
-----------------------------------------------------------------------------
</TABLE>
20
<PAGE>
National Limited Maturity Municipals Portfolio as of March 31, 1997
INDEPENDENT AUDITORS' REPORT
To the Trustees and Investors of
National Limited Maturity Municipals Portfolio:
- --------------------------------------------------------------------------------
We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of National Limited Maturity Municipals Portfolio
as of March 31, 1997, the related statement of operations for the year then
ended, the statements of changes in net assets for the years ended March 31,
1997 and 1996 and the supplementary data for each of the years in the three year
period ended March 31, 1997 and for the period from the start of business,
May 3, 1993 to March 31, 1994. These financial statements and supplementary data
are the responsibility of the Trust's management. Our responsibility is to
express an opinion on these financial statements and supplementary data 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 supplementary
data 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 held as of March
31, 1997 by correspondence with the custodian and brokers. An audit also
includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and supplementary data present fairly,
in all material respects, the financial position of National Limited Maturity
Municipals Portfolio at March 31, 1997, the results of its operations, the
changes in its net assets and its supplementary data for the respective stated
periods, in conformity with generally accepted accounting principles.
DELOITTE & TOUCHE LLP
Boston, Massachusetts
May 2, 1997
21
<PAGE>
EV Classic National Limited Maturity Municipals Fund as of March 31, 1997
INVESTMENT MANAGEMENT
National Limited Maturity Municipals Portfolio
<TABLE>
<S> <C>
Officers Independent Trustees
Thomas J. Fetter Donald R. Dwight
President President, Dwight Partners, Inc.
Chairman, Newspapers of New England, Inc.
James B. Hawkes
Vice President and Trustee Samuel L. Hayes, III
Jacob H. Schiff Professor of Investment
Robert B. MacIntosh Banking, Harvard University Graduate School of Business Administration
Vice President
Norton H. Reamer
William H. Ahern, Jr. President and Director, United Asset
Vice President and Management Corporation
Portfolio Manager
John L. Thorndike
James L. O'Connor Formerly Director, Fiduciary Company Incorporated
Treasurer
Jack L. Treynor
Thomas Otis Investment Adviser and Consultant
Secretary
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