File Nos. 33-58248
811-7502
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 9 [X]
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. 9 [X]
(Check appropriate box or boxes.)
DREYFUS INTERNATIONAL FUNDS, INC.
(Exact Name of Registrant as Specified in Charter)
c/o The Dreyfus Corporation
200 Park Avenue, New York, New York 10166
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (212) 922-6000
Mark N. Jacobs, Esq.
200 Park Avenue
New York, New York 10166
(Name and Address of Agent for Service)
It is proposed that this filing will become effective (check appropriate
box)
immediately upon filing pursuant to paragraph (b)
----
X on January 15, 1997 pursuant to paragraph (b)
----
60 days after filing pursuant to paragraph (a)(i)
----
on (date) pursuant to paragraph (a)(i)
----
75 days after filing pursuant to paragraph (a)(ii)
----
on (date) pursuant to paragraph (a)(ii) of Rule 485
----
If appropriate, check the following box:
this post-effective amendment designates a new effective date for
a previously filed post-effective amendment.
----
Registrant has registered an indefinite number of shares of its common
stock under the Securities Act of 1933 pursuant to Section 24(f) of the
Investment Company Act of 1940. Registrant's Rule 24f-2 Notice for the
fiscal year ended May 31, 1996 for its Dreyfus International Growth Fund
(formerly, Dreyfus International Equity Fund) was filed on July 25, 1996.
Registrant's Rule 24f-2 Notice for the fiscal year ended May 31, 1997 for
its Dreyfus Emerging Markets Fund is expected to be filed on or about July
25, 1997.
DRYEFUS INTERNATIONAL FUNDS, INC.
Cross-Reference Sheet Pursuant to Rule 495(a)
Dreyfus
Emerging
Items in Markets Fund
Part A of _____________
Form N-1A Caption Page
_________ _______ ____
1 Cover Page Cover
2 Synopsis 3
3 Condensed Financial Information 4
4 General Description of Registrant 4 and 18
5 Management of the Fund 7
5(a) Management's Discussion of Fund's Performance *
6 Capital Stock and Other Securities 18
7 Purchase of Securities Being Offered 8
8 Redemption or Repurchase 13
9 Pending Legal Proceedings *
Items in
Part B of
Form N-1A All Funds
_________ _________
10 Cover Page Cover
11 Table of Contents Cover
12 General Information and History B-30
13 Investment Objectives and Policies B-2
14 Management of the Fund B-11
15 Control Persons and Principal B-15
Holders of Securities
16 Investment Advisory and Other B-15
Services
_____________________________________
NOTE: * Omitted since answer is negative or inapplicable.
DREYFUS INTERNATIONAL FUNDS, INC.
Cross-Reference Sheet Pursuant to Rule 495(a) (continued)
Items in
Part B of
Form N-1A Caption Page
_________ _______ _____
17 Brokerage Allocation B-28
18 Capital Stock and Other Securities B-30
19 Purchase, Redemption and Pricing B-17; B-20
of Securities Being Offered and B-25
20 Tax Status B-26
21 Underwriters B-1 and
B-17
22 Calculations of Performance Data B-29
23 Financial Statements B-37
Items in
Part C of
Form N-1A
_________
24 Financial Statements and Exhibits C-1
25 Persons Controlled by or Under C-3
Common Control with Registrant
26 Number of Holders of Securities C-3
27 Indemnification C-3
28 Business and Other Connections of C-4
Investment Adviser
29 Principal Underwriters C-10
30 Location of Accounts and Records C-13
31 Management Services C-13
32 Undertakings C-13
_____________________________________
NOTE: * Omitted since answer is negative or inapplicable.
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PROSPECTUS JANUARY 15, 1997
DREYFUS EMERGING MARKETS FUND
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DREYFUS EMERGING MARKETS FUND (THE "FUND") IS A SEPARATE
NON-DIVERSIFIED PORTFOLIO OF DREYFUS INTERNATIONAL FUNDS, INC., AN OPEN-END,
MANAGEMENT INVESTMENT COMPANY (THE "COMPANY"), KNOWN AS A MUTUAL FUND. THE
FUND'S INVESTMENT OBJECTIVE IS LONG-TERM CAPITAL APPRECIATION. THE FUND WILL
INVEST PRINCIPALLY IN THE EQUITY SECURITIES OF FOREIGN ISSUERS IN COUNTRIES
WITH EMERGING MARKETS.
YOU CAN PURCHASE OR REDEEM SHARES BY TELEPHONE USING DREYFUS
TELETRANSFER.
IN SOME CASES, SHAREHOLDERS WILL BE CHARGED A 1% REDEMPTION FEE WHICH
WILL BE DEDUCTED FROM REDEMPTION PROCEEDS ON SHARES HELD LESS THAN SIX
MONTHS.
THE DREYFUS CORPORATION PROFESSIONALLY MANAGES THE FUND'S PORTFOLIO.
THIS PROSPECTUS SETS FORTH CONCISELY INFORMATION ABOUT THE FUND THAT
YOU SHOULD KNOW BEFORE INVESTING. IT SHOULD BE READ AND RETAINED FOR FUTURE
REFERENCE.
THE STATEMENT OF ADDITIONAL INFORMATION, DATED JANUARY 15, 1997,
WHICH MAY BE REVISED FROM TIME TO TIME, PROVIDES A FURTHER DISCUSSION OF
CERTAIN AREAS IN THIS PROSPECTUS AND OTHER MATTERS WHICH MAY BE OF INTEREST
TO SOME INVESTORS. IT HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION AND IS INCORPORATED HEREIN BY REFERENCE. THE SECURITIES AND
EXCHANGE COMMISSION MAINTAINS A WEB SITE (HTTP://WWW.SEC.GOV) THAT CONTAINS
THE STATEMENT OF ADDITIONAL INFORMATION, MATERIAL INCORPORATED BY REFERENCE,
AND OTHER INFORMATION REGARDING THE FUND. FOR A FREE COPY OF THE STATEMENT OF
ADDITIONAL INFORMATION, WRITE TO THE FUND AT 144 GLENN CURTISS BOULEVARD,
UNIONDALE, NEW YORK 11556-0144, OR CALL 1-800-645-6561. WHEN TELEPHONING, ASK
FOR OPERATOR 144.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
OR ENDORSED BY, ANY BANK, AND ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER AGENCY.
THE NET ASSET VALUE OF FUNDS OF THIS TYPE WILL FLUCTUATE FROM TIME TO TIME.
TABLE OF CONTENTS
PAGE
FEE TABLE......................................... 3
CONDENSED FINANCIAL INFORMATION................... 4
DESCRIPTION OF THE FUND........................... 4
MANAGEMENT OF THE FUND............................ 7
HOW TO BUY SHARES................................. 8
SHAREHOLDER SERVICES.............................. 10
HOW TO REDEEM SHARES.............................. 13
SHAREHOLDER SERVICES PLAN......................... 16
DIVIDENDS, DISTRIBUTIONS AND TAXES................ 16
PERFORMANCE INFORMATION........................... 17
GENERAL INFORMATION............................... 18
APPENDIX.......................................... 19
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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.
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[This Page Intentionally Left Blank]
Page 2
<TABLE>
<CAPTION>
Fee Table
<S> <C>
SHAREHOLDER TRANSACTIONS EXPENSES
Redemption Fee* (as a percentage of amount redeemed)....................... 1.00%
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average daily net assets)
Management Fees (after expense reimbursement).............................. .00%
Other Expenses (after expense reimbursement)............................... 2.00%
Total Fund Operating Expenses (after expense reimbursement)................ 2.00%
* Shares acquired by purchase or exchange and held for less than six months
may be subject to a 1% redemption fee payable to the Fund. See "How to Redeem
Shares."
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
EXAMPLE: 1 YEAR 3 YEARS
You would pay the following
expenses on a $1,000 invest-
ment, assuming (1) 5% annual
return and (2) redemption at
the end of each time period: $20 $63
</TABLE>
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THE AMOUNTS LISTED IN THE EXAMPLE SHOULD NOT BE CONSIDERED AS
REPRESENTATIVE OF PAST OR FUTURE EXPENSES AND ACTUAL EXPENSES MAY BE GREATER
OR LESS THAN THOSE INDICATED. MOREOVER, WHILE THE EXAMPLE ASSUMES A 5% ANNUAL
RETURN, THE FUND'S ACTUAL PERFORMANCE WILL VARY AND MAY RESULT IN AN ACTUAL
RETURN GREATER OR LESS THAN 5%.
- ------------------------------------------------------------------------------
The purpose of the foregoing table is to assist you in understanding
the costs and expenses borne by the Fund and investors, the payment of which
will reduce investors' annual return. Annual Fund Operating expenses noted
above have been restated to reflect an undertaking by The Dreyfus Corporation
that if, in the fiscal year ending May 31, 1997, Fund expenses, including the
management fee, exceed 2.00% of the value of the Fund's average net assets for
the fiscal year, The Dreyfus Corporation may waive its management fee or bear
certain Fund expenses to the extent of such excess expense. The expenses noted
above, without reimbursement and based on estimated amounts for the current
fiscal year, would be: Management Fee -- 1.25%, Other Expenses -- 2.05% and
Total Fund Operating Expenses -- 3.30%. Certain Service Agent(s) (as defined
below) may charge their clients direct fees for effecting transactions in Fund
shares; such fees are not reflected in the foregoing table. For a further
description of the various costs and expenses incurred in the operation of the
Fund, as well as expense reimbursement or waiver arrangements, see "Management
of the Fund," "How to Buy Shares," "How to Redeem Shares" and "Shareholder
Services Plan."
Page 3
CONDENSED FINANCIAL INFORMATION
The table below sets forth certain information covering the Fund's
investment results for the period indicated. Further financial data and
related notes are included in the Statement of Additional Information,
available upon request.
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share
of Common Stock outstanding, total investment return, ratios to average net
assets and other supplemental data for the period June 28, 1996
(commencement of operations) to November 30, 1996 (unaudited). This
information has been derived from the Fund's financial statements.
<TABLE>
<CAPTION>
<S> <C>
PER SHARE DATA:
Net asset value, beginning of period...................................... $12.50
--------
INVESTMENT OPERATIONS:
Investment Income - net................................................... -
Net realized and unrealized gain (loss) on investments.................... (.27)
--------
TOTAL FROM INVESTMENT OPERATIONS.......................................... (.27)
--------
Net asset value, end of period............................................ $12.23
--------
TOTAL INVESTMENT RETURN..................................................... (2.16%)(1)(2)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets................................... .85%(2)
Ratio of net investment income to average net assets...................... .07%(2)
Decrease reflected in above expense ratios due to undertaking by The Dreyfus Corporation .56%(2)
Portfolio Turnover Rate................................................... 19.86%(2)
Average Commission Rate (3)............................................... $.0212
Net Assets, end of period (000's omitted)................................. $13,288
(1) Exclusive of redemption fee.
(2) Not annualized.
(3) The Fund is required to disclose its average commission rate paid per
share for purchases and sales of investment securities.
</TABLE>
Further information about the Fund's performance will be contained in
the Fund's annual report for the fiscal year ending May 31, 1997, which will
be available approximately the end of July 1997, and which may be obtained
without charge by writing to the address or calling the number set forth on
the cover page of this Prospectus.
DESCRIPTION OF THE FUND
INVESTMENT OBJECTIVE
The Fund's investment objective is long-term capital appreciation. It
cannot be changed without approval by the holders of a majority (as defined
in the Investment Company Act of 1940, as amended (the "1940 Act")) of the
Fund's outstanding voting shares. There can be no assurance that the Fund's
investment objective will be achieved.
INVESTMENT APPROACH
The Fund's investment approach is value-oriented and research-driven.
To manage the Fund, The Dreyfus Corporation evaluates traditional measures to
classify issuers as "value" companies. In general, The Dreyfus Corporation
believes that companies with relatively low price to book ratios, low price
to earnings ratios, low price to cash flow ratios or higher than average
dividend payments in relation to price should be classified as value
companies. In addition, The Dreyfus Corporation intends to consider broader
measures, including operating return characteristics, overall financial
health and positive changes in business momentum. This value-oriented,
bottom-up investment style is both quantitative and fundamentally based,
focusing first on stock selection then enhanced by broadly diversified
country allocation.
MANAGEMENT POLICIES
Under normal circumstances, the Fund will invest at least 65% of the
value of its total assets in equity securities of foreign issuers in
countries having emerging markets. For purposes of the Fund's operations,
"emerging markets countries" will consist of all countries represented by the
Morgan Stanley Capital
Page 4
International Emerging Markets Index ("MSCI-Emerging Markets") and any other
country determined by The Dreyfus Corporation to have developing or emerging
economies and markets. The countries represented by the MSCI-Emerging Markets
Index currently include Argentina, Brazil, Chile, China, Colombia, the Czech
Republic, Greece, Hungary, India, Indonesia, Israel, Jordan, Korea, Malaysia,
Mexico, Pakistan, Peru, Philippines, Poland, Portugal, Sri Lanka, South
Africa, Taiwan, Thailand, Turkey and Venezuela. The assets of the Fund
ordinarily will be invested in the securities of issuers in at least three
different emerging markets countries. The Fund does not anticipate that it
will invest more than 25% of the value of its total assets in the securities
issuers in any one emerging market country.
Issuers whose principal activities are in emerging markets countries
include issuers (1) organized under the laws of, (2) whose securities have
their primary trading market in, (3) deriving at least 50% of their revenues
or profits from goods sold, investments made, or services performed in, or
(4) having at least 50% of their assets located in, an emerging market
country. The Dreyfus Corporation will base determinations as to eligibility
on publicly available information and inquiries made to the companies.
The equity securities in which the Fund may invest consist of common
stocks and preferred stocks. Certain emerging markets countries are closed in
whole or in part to equity investments by foreigners. The Fund may be able to
invest in such countries solely or primarily through investment vehicles,
such as closed-end investment companies, authorized by such emerging market
country's government. See "Appendix -- Certain Portfolio Securities --
Closed-End Investment Companies."
While seeking desirable equity investments, the Fund may invest in
money market instruments consisting of U.S. Government securities,
certificates of deposit, time deposits, bankers' acceptances, short-term
investment grade corporate bonds and other short-term debt instruments, and
repurchase agreements, as set forth under "Appendix -- Certain Portfolio
Securities -- Money Market Instruments." Under normal market conditions, the
Fund does not expect to have a substantial portion of its assets invested in
money market instruments. However, when The Dreyfus Corporation determines
that adverse market conditions exist, the Fund may adopt a temporary
defensive posture and invest all of its assets in money market instruments.
The Fund also may invest in money market instruments in anticipation of
investing cash positions.
The Fund's annual portfolio turnover rate is not expected to exceed
150%. Higher portfolio turnover rates usually generate additional brokerage
commissions and expenses and the short-term gains realized from these
transactions are taxable to shareholders as ordinary income. In addition, the
Fund may engage in various investment techniques, such as foreign currency
transactions, options and futures transactions and short-selling. For a
discussion of the investment techniques and their related risks, see
"Investment Considerations and Risks" and "Appendix -- Investment Techniques"
below and "Investment Objective and Management Policies -- Management
Policies" in the Statement of Additional Information.
INVESTMENT CONSIDERATIONS AND RISKS
GENERAL -- The Fund's net asset value per share should be expected to
fluctuate. Investors should consider the Fund as a supplement to an overall
investment program and should invest only if they are willing to undertake
the risks involved. See "Investment Objective and Management Policies --
Management Policies" in the Statement of Additional Information for a further
discussion of certain risks.
EQUITY SECURITIES -- Equity securities fluctuate in value, often based on
factors unrelated to the value of the issuer of the securities, and such
fluctuations can be pronounced. Changes in the value of the Fund's
investments will result in changes in the value of its shares and thus the
Fund's total return to investors.
The securities of the smaller companies in which the Fund may invest
may be subject to more abrupt or erratic market movements than larger, more
established companies, because these securities typically are traded in lower
volume and the issuers typically are subject to a greater degree to changes
in earnings and prospects. This risk may be incurred by the Fund's investing
in issuers in emerging markets countries, as more fully described below.
Page 5
FOREIGN SECURITIES -- Foreign securities markets generally are not as
developed or efficient as those in the United States. Securities of some
foreign issuers are less liquid and more volatile than securities of
comparable U.S. issuers. Similarly, volume and liquidity in most foreign
securities markets are less than in the United States and, at times,
volatility of price can be greater than in the United States.
Because evidences of ownership of such securities usually are held
outside the United States, the Fund will be subject to additional risks which
include possible adverse political and economic developments, seizure or
nationalization of foreign deposits or adoption of governmental restrictions
which might adversely affect the payment of principal and interest on the
foreign securities or restrict the payment of principal and interest to
investors located outside the country of the issuer, whether from currency
blockage or otherwise.
Since foreign securities often are purchased with and payable in
currencies of foreign countries, the value of these assets as measured in
U.S. dollars may be affected favorably or unfavorably by changes in currency
rates and exchange control regulations.
The risks associated with investing in foreign securities are often
heightened for investments in emerging markets countries. These heightened
risks include (i) greater risks of expropriation, confiscatory taxation,
nationalization, and less social, political and economic stability; (ii) the
small current size of the markets for securities of emerging markets issuers
and the currently low or nonexistent volume of trading, resulting in lack of
liquidity and in price volatility; (iii) certain national policies which may
restrict the Fund's investment opportunities including restrictions on
investing in issuers or industries deemed sensitive to relevant national
interests; and (iv) the absence of developed legal structures governing
private or foreign investment and private property. In addition, some
emerging markets countries may have fixed or managed currencies which are not
free-floating against the U.S. dollar. Further, certain emerging markets
countries' currencies may not be internationally traded. Certain of these
currencies have experienced a steady devaluation relative to the U.S. dollar.
If the Fund is unable to hedge the U.S. dollar value of securities it owns
denominated in such currencies, the Fund's net asset value will be adversely
affected. Many emerging markets countries have experienced substantial, and
in some periods extremely high, rates of inflation for many years. Inflation
and rapid fluctuations in inflation rates have had, and may continue to have,
negative effects on the economies and securities markets of certain emerging
markets countries.
FOREIGN CURRENCY TRANSACTIONS -- Currency exchange rates may fluctuate
significantly over short periods of time. They generally are determined by
the forces of supply and demand in the foreign exchange markets and the
relative merits of investments in different countries, actual or perceived
changes in interest rates and other complex factors, as seen from an
international perspective. Currency exchange rates also can be affected
unpredictably by intervention by U.S. or foreign governments or central
banks, or the failure to intervene, or by currency controls or political
developments in the United States or abroad. See "Appendix -- Investment
Techniques -- Foreign Currency Transactions."
USE OF DERIVATIVES -- The Fund may invest in derivatives ("Derivatives").
These are financial instruments which derive their performance, at least in
part, from the performance of an underlying asset, index or interest rate.
The Derivatives the Fund may use include options and futures. While
Derivatives can be used effectively in furtherance of the Fund's investment
objective, under certain market conditions, they can increase the volatility
of the Fund's net asset value, can decrease the liquidity of the Fund's
portfolio and make more difficult the accurate pricing of the Fund's
portfolio. See "Appendix -- Investment Techniques -- Use of Derivatives"
below and "Investment Objective and Management Policies -- Management
Policies -- Derivatives" in the Statement of Additional Information.
NON-DIVERSIFIED STATUS -- The classification of the Fund as a
"non-diversified" investment company means that the proportion of the Fund's
assets that may be invested in the securities of a single issuer is not
limited by the 1940 Act. A "diversified" investment company is required by
the 1940 Act generally,
Page 6
with respect to 75% of its total assets, to invest not more than 5% of such
assets in the securities of a single issuer. Since a relatively high
percentage of the Fund's assets may be invested in the securities of a
limited number of issuers, some of which may be within the same industry,
the Fund's portfolio may be more sensitive to changes in the market value
of a single issuer or industry. However, to meet Federal tax requirements,
at the close of each quarter the Fund may not have more than 25% of its
total assets invested in any one issuer and, with respect to 50% of total
assets, not more than 5% of its total assets invested in any one issuer.
These limitations do not apply to U.S. Government securities.
SIMULTANEOUS INVESTMENTS -- Investment decisions for the Fund are made
independently from those of the other investment companies advised by The
Dreyfus Corporation. If, however, such other investment companies desire to
invest in, or dispose of, the same securities as the Fund, available
investments or opportunities for sales will be allocated equitably to each
investment company. In some cases, this procedure may adversely affect the
size of the position obtained for or disposed of by the Fund or the price
paid or received by the Fund.
MANAGEMENT OF THE FUND
INVESTMENT ADVISER -- The Dreyfus Corporation, located at 200 Park Avenue,
New York, New York 10166, was formed in 1947 and serves as the Fund's
investment adviser. The Dreyfus Corporation is a wholly-owned subsidiary of
Mellon Bank, N.A., which is a wholly-owned subsidiary of Mellon Bank
Corporation ("Mellon"). As of November 30, 1996, The Dreyfus Corporation
managed or administered approximately $84 billion in assets for approximately
1.7 million investor accounts nationwide.
The Dreyfus Corporation supervises and assists in the overall
management of the Fund's affairs under a Management Agreement with the
Company, subject to the authority of the Company's Board in accordance with
Maryland law. The Fund's primary portfolio manager is D. Kirk Henry. He has
held that position since June 1996 and has been employed by The Dreyfus
Corporation as a portfolio manager since May 1996. He also is a Vice
President and international equity portfolio manager of The Boston Company
Asset Management, Inc. ("TBC Asset Management"), an indirect wholly-owned
subsidiary of Mellon and, thus, an affiliate of The Dreyfus Corporation. Mr.
Henry has been employed by TBC Asset Management or its predecessor since May
1994. Prior to joining TBC Asset Management, Mr. Henry was Executive Vice
President of Cseh International Associates, Inc., the international money
management division of Cashman, Farrell & Associates. The Fund's other
portfolio managers are identified in the Statement of Additional Information.
The Dreyfus Corporation also provides research services for the Fund and for
other funds advised by The Dreyfus Corporation through a professional staff
of portfolio managers and securities analysts.
Mellon is a publicly owned multibank holding company incorporated
under Pennsylvania law in 1971 and registered under the Federal Bank Holding
Company Act of 1956, as amended. Mellon provides a comprehensive range of
financial products and services in domestic and selected international
markets. Mellon is among the twenty-five largest bank holding companies in
the United States based on total assets. Mellon's principal wholly-owned
subsidiaries are Mellon Bank, N.A., Mellon Bank (DE) National Association,
Mellon Bank (MD), The Boston Company, Inc., AFCO Credit Corporation and a
number of companies known as Mellon Financial Services Corporations. Through
its subsidiaries, including The Dreyfus Corporation, Mellon managed more than
$226 billion in assets as of September 30, 1996, including approximately $85
billion in proprietary mutual fund assets. As of September 30, 1996, Mellon,
through various subsidiaries, provided non-investment services, such as
custodial or administration services, for more than $905 billion in assets,
including approximately $60 billion in mutual fund assets.
Under the terms of the Management Agreement, the Fund has agreed to
pay The Dreyfus Corporation a monthly fee at the annual rate of 1.25% of the
value of the Fund's average daily net assets. From time to time, The Dreyfus
Corporation may waive receipt of its fees and/or voluntarily assume certain
expenses of the Fund, which would have the effect of lowering the expense
ratio of the Fund and increasing yield to
Page 7
investors. The Fund will not pay The Dreyfus Corporation at a later time for
any amounts it may waive, nor will the Fund reimburse The Dreyfus Corporation
for any amounts it may assume.
In allocating brokerage transactions for the Fund, The Dreyfus
Corporation seeks to obtain the best execution of orders at the most
favorable net price. Subject to this determination, The Dreyfus Corporation
may consider, among other things, the receipt of research services and/or the
sale of shares of the Fund or other funds advised, managed or administered by
The Dreyfus Corporation as factors in the selection of broker-dealers to
execute portfolio transactions for the Fund. See "Portfolio Transactions" in
the Statement of Additional Information.
The Dreyfus Corporation may pay the Fund's distributor for
shareholder services from The Dreyfus Corporation's own assets, including
past profits but not including the management fee paid by the Fund. The
Fund's distributor may use part or all of such payments to pay Service Agents
in respect of these services.
EXPENSES -- All expenses incurred in the operation of the Company are borne
by the Company, except to the extent specifically assumed by The Dreyfus
Corporation. The expenses borne by the Company include: organizational
costs, taxes, interest, loan commitment fees, interest and distributions paid
on securities sold short, brokerage fees and commissions, if any, fees of
Board members who are not officers, directors, employees or holders of 5% or
more of the outstanding voting securities of The Dreyfus Corporation or any
of its affiliates, Securities and Exchange Commission fees, state Blue Sky
qualification fees, advisory fees, charges of custodians, transfer and
dividend disbursing agents' fees, certain insurance premiums, industry
association fees, outside auditing and legal expenses, costs of independent
pricing services, costs of maintaining the Company's existence, costs
attributable to investor services (including, without limitation, telephone
and personnel expenses), costs of preparing and printing prospectuses and
statements of additional information for regulatory purposes and for
distribution to existing shareholders, costs of shareholders' reports and
meetings, and any extraordinary expenses. Expenses attributable to the Fund
are charged against the assets of the Fund; other expenses of the Company are
allocated among the Company's portfolios on the basis determined by the
Company's Board, including, but not limited to, proportionately in relation
to the net assets of each portfolio.
DISTRIBUTOR -- The Fund's distributor is Premier Mutual Fund Services, Inc.
(the "Distributor"), located at 60 State Street, Boston, Massachusetts 02109.
The Distributor's ultimate parent is Boston Institutional Group, Inc.
TRANSFER AND DIVIDEND DISBURSING AGENT AND CUSTODIAN -- Dreyfus Transfer,
Inc., a wholly-owned subsidiary of The Dreyfus Corporation, P.O. Box 9671,
Providence, Rhode Island 02940-9671, is the Fund's Transfer and Dividend
Disbursing Agent (the "Transfer Agent"). The Bank of New York, 90 Washington
Street, New York, New York 10286, is the Fund's Custodian.
HOW TO BUY SHARES
Fund shares are sold without a sales charge. You may be charged a fee
if you effect transactions in Fund shares through a securities dealer, bank
or other financial institution (collectively, "Service Agents"). Stock
certificates are issued only upon your written request. No certificates are
issued for fractional shares. The Fund reserves the right to reject any
purchase order.
The minimum initial investment is $2,500, or $1,000 if you are a
client of a Service Agent which maintains an omnibus account in the Fund and
has made an aggregate minimum initial purchase for its customers of $2,500.
Subsequent investments must be at least $100. However, the minimum initial
investment for Dreyfus-sponsored Keogh Plans, IRAs, SEP-IRAs and 403(b)(7)
Plans with only one participant is $750, with no minimum for subsequent
purchases. Individuals who open an IRA also may open a non-working spousal
IRA with a minimum initial investment of $250. Subsequent investments in a
spousal IRA must be at least $250. The initial investment must be accompanied
by the Account Application. For full-time or part-time employees of The
Dreyfus Corporation or any of its affiliates or subsidiaries, directors of
The Dreyfus Corporation, Board members of a fund advised by The Dreyfus
Corporation, including members of the Company's Board, or the spouse or minor
child of any of the foregoing, the minimum initial investment is $1,000. For
full-time or part-time employees of The Dreyfus Corporation or any of its
affiliates or
Page 8
subsidiaries who elect to have a portion of their pay directly deposited into
their Fund account, the minimum initial investment is $50. The Fund reserves
the right to offer Fund shares without regard to minimum purchase requirements
to employees participating in certain qualified or non-qualified employee
benefit plans or other programs where contributions or account information can
be transmitted in a manner and form acceptable to the Fund. The Fund reserves
the right to vary further the initial and subsequent investment minimum
requirements at any time. Fund shares also are offered without regard to the
minimum initial investment requirements through Dreyfus-AUTOMATIC Asset
BuilderRegistration Mark, Dreyfus Government Direct Deposit Privilege or
Dreyfus Payroll Savings Plan pursuant to the Dreyfus Step Program described
under "Shareholder Services." These services enable you to make regularly
scheduled investments and may provide you with a convenient way to invest for
long-term financial goals. You should be aware, however, that periodic
investment plans do not guarantee a profit and will not protect an investor
against loss in a declining market.
You may purchase Fund shares by check or wire, or through the Dreyfus
TELETRANSFER Privilege described below. Checks should be made payable to "The
Dreyfus Family of Funds," or, if for Dreyfus retirement plan accounts, to
"The Dreyfus Trust Company, Custodian" and should specify that you are
investing in the Fund. Payments to open new accounts which are mailed should
be sent to The Dreyfus Family of Funds, P.O. Box 9387, Providence, Rhode
Island 02940-9387, together with your Account Application. For subsequent
investments, your Fund account number should appear on the check and an invest
ment slip should be enclosed and sent to The Dreyfus Family of Funds, P.O.
Box 105, Newark, New Jersey 07101-0105. For Dreyfus retirement plan accounts,
both initial and subsequent investments should be sent to The Dreyfus Trust
Company, Custodian, P.O. Box 6427, Providence, Rhode Island 02940-6427.
Neither initial nor subsequent investments should be made by third party
check. Purchase orders may be delivered in person only to a Dreyfus Financial
Center. THESE ORDERS WILL BE FORWARDED TO THE FUND AND WILL BE PROCESSED ONLY
UPON RECEIPT THEREBY. For the location of the nearest Dreyfus Financial
Center, please call one of the telephone numbers listed under "General
Information."
Wire payments may be made if your bank account is in a commercial
bank that is a member of the Federal Reserve System or any other bank having
a correspondent bank in New York City. Immediately available funds may be
transmitted by wire to The Bank of New York, DDA# 8900284188/Dreyfus Emerging
Markets Fund, for purchase of Fund shares in your name. The wire must include
your Fund account number (for new accounts, your Taxpayer Identification
Number ("TIN") should be included instead), account registration and dealer
number, if applicable. If your initial purchase of Fund shares is by wire,
please call 1-800-645-6561 after completing your wire payment to obtain your
Fund account number. Please include your Fund account number on the Account
Application and promptly mail the Account Application to the Fund, as no
redemptions will be permitted until the Account Application is received. You
may obtain further information about remitting funds in this manner from your
bank. All payments should be made in U.S. dollars and, to avoid fees and
delays, should be drawn only on U.S. banks. A charge will be imposed if any
check used for investment in your account does not clear. The Fund makes
available to certain large institutions the ability to issue purchase
instructions through compatible computer facilities.
Subsequent investments also may be made by electronic transfer of
funds from an account maintained in a bank or other domestic financial
institution that is an Automated Clearing House member. You must direct the
institution to transmit immediately available funds through the Automated
Clearing House to The Bank of New York with instructions to credit your Fund
account. The instructions must specify your Fund account registration and
Fund account number PRECEDED BY THE DIGITS "1111."
Page 9
Fund shares are sold on a continuous basis at the net asset value per
share next determined after an order in proper form is received by the
Transfer Agent or other agent. Net asset value per share is determined as of
the close of trading on the floor of the New York Stock Exchange (currently
4:00 p.m., New York time), on each day the New York Stock Exchange is open
for business. For purposes of determining net asset value, options and
futures contracts will be valued 15 minutes after the close of trading on the
floor of the New York Stock Exchange. Net asset value per share is computed
by dividing the value of the Fund's net assets (i.e., the value of its assets
less liabilities) by the total number of Fund shares outstanding. The Fund's
investments are valued generally at market value or, where market quotations
are not readily available, at fair value as determined by or under the
direction of the Company's Board. For further information regarding the
methods employed in valuing the Fund's investments, see "Determination of Net
Asset Value" in the Statement of Additional Information.
For certain institutions that have entered into agreements with the
Distributor, payment for the purchase of Fund shares may be transmitted, and
must be received by the Transfer Agent, within three business days after the
order is placed. If such payment is not received within three business days
after the order is placed, the order may be canceled and the institution
could be held liable for resulting fees and/or losses.
The Distributor may pay dealers a fee of up to .5% of the amount
invested through such dealers in Fund shares by employees participating in
qualified or non-qualified employee benefit plans or other programs where (i)
the employers or affiliated employers maintaining such plans or programs have
a minimum of 250 employees eligible for participation in such plans or
programs or (ii) such plan's or program's aggregate investment in the Dreyfus
Family of Funds or certain other products made available by the Distributor
to such plans or programs exceeds $1,000,000 ("Eligible Benefit Plans").
Shares of funds in the Dreyfus Family of Funds then held by Eligible Benefit
Plans will be aggregated to determine the fee payable. The Distributor
reserves the right to cease paying these fees at any time. The Distributor
will pay such fees from its own funds, other than amounts received from the
Fund, including past profits or any other source available to it.
Federal regulations require that you provide a certified TIN upon
opening or reopening an account. See "Dividends, Distributions and Taxes" and
the Account Application for further information concerning this requirement.
Failure to furnish a certified TIN to the Fund could subject you to a $50
penalty imposed by the Internal Revenue Service (the "IRS").
DREYFUS TELETRANSFER PRIVILEGE -- You may purchase shares (minimum $500,
maximum $150,000 per day) by telephone if you have checked the appropriate
box and supplied the necessary information on the Account Application or have
filed a Shareholder Services Form with the Transfer Agent. The proceeds will
be transferred between the bank account designated in one of these documents
and your Fund account. Only a bank account maintained in a domestic financial
institution which is an Automated Clearing House member may be so designated.
The Fund may modify or terminate this Privilege at any time or charge a
service fee upon notice to shareholders. No such fee currently is
contemplated.
If you have selected the Dreyfus TELETRANSFER Privilege, you may
request a Dreyfus TELETRANSFER purchase of shares by calling 1-800-645-6561
or, if you are calling from overseas, call 516-794-5452.
SHAREHOLDER SERVICES
FUND EXCHANGES
You may purchase, in exchange for shares of the Fund, shares of
certain other funds managed or administered by The Dreyfus Corporation, to
the extent such shares are offered for sale in your state of residence. These
funds have different investment objectives which may be of interest to you.
If you desire to use this service, you should consult your Service Agent or
call 1-800-645-6561 to determine if it is available and whether any
conditions are imposed on its use.
To request an exchange, you must give exchange instructions to the
Transfer Agent in writing or by telephone. Before any exchange, you must
obtain and should review a copy of the current prospectus of
Page 10
the fund into which the exchange is being made. Prospectuses may be obtained
by calling 1-800-645-6561. Except in the case of personal retirement plans,
the shares being exchanged must have a current value of at least $500;
furthermore, when establishing a new account by exchange, the shares being
exchanged must have a value of at least the minimum initial investment
required for the fund into which the exchange is being made. The ability to
issue exchange instructions by telephone is given to all Fund shareholders
automatically, unless you check the applicable "No" box on the Account
Application, indicating that you specifically refuse this Privilege. The
Telephone Exchange Privilege may be established for an existing account by
written request, signed by all shareholders on the account, by a separate
signed Shareholder Services Form, available by calling 1-800-645-6561, or by
oral request from any of the authorized signatories on the account by calling
1-800-645-6561. If you have established the Telephone Exchange Privilege, you
may telephone exchange instructions (including over The Dreyfus
TouchRegistration Mark automated telephone system) by calling 1-800-645-6561.
If you are calling from overseas, call 516-794-5452. See "How to Redeem Shares
- -- Procedures." Upon an exchange into a new account, the following
shareholder services and privileges, as applicable and where available, will
be automatically carried over to the fund into which the exchange is made:
Telephone Exchange Privilege, Wire Redemption Privilege, Telephone Redemption
Privilege, Dreyfus TELETRANSFER Privilege and the dividend/capital gain
distribution option (except for Dreyfus Dividend Sweep) selected by the
investor.
The Fund will deduct a redemption fee equal to 1% of the net asset
value of such shares exchanged out of the Fund where the exchange is made
less than six months after issuance. See "How to Redeem Shares." Otherwise,
shares will be exchanged at the next determined net asset value; however, a
sales load may be charged with respect to exchanges into funds sold with a
sales load. If you are exchanging into a fund that charges a sales load, you
may qualify for share prices which do not include the sales load or which
reflect a reduced sales load, if the shares you are exchanging were: (a)
purchased with a sales load, (b) acquired by a previous exchange from shares
purchased with a sales load, or (c) acquired through reinvestment of
dividends or distributions paid with respect to the foregoing categories of
shares. To qualify, at the time of the exchange you must notify the Transfer
Agent or your Service Agent must notify the Distributor. Any such
qualification is subject to confirmation of your holdings through a check of
appropriate records. See "Shareholder Services" in the Statement of
Additional Information. No fees currently are charged shareholders directly
in connection with exchanges, although the Fund reserves the right, upon not
less than 60 days' written notice, to charge shareholders a nominal fee in
accordance with rules promulgated by the Securities and Exchange Commission.
The Fund reserves the right to reject any exchange request in whole or in
part. The availability of Fund Exchanges may be modified or terminated at any
time upon notice to shareholders. See "Dividends, Distributions and Taxes."
DREYFUS AUTO-EXCHANGE PRIVILEGE
Dreyfus Auto-Exchange Privilege enables you to invest regularly (on a
semi-monthly, monthly, quarterly or annual basis), in exchange for shares of
the Fund, in shares of certain other funds in the Dreyfus Family of Funds of
which you are a shareholder. The amount you designate, which can be expressed
either in terms of a specific dollar or share amount ($100 minimum), will be
exchanged automatically on the first and/or fifteenth day of the month
according to the schedule you have selected. Shares will be exchanged at the
then-current net asset value; however, a sales load may be charged with
respect to exchanges into funds sold with a sales load. See "Shareholder
Services" in the Statement of Additional Information. The right to exercise
this Privilege may be modified or canceled by the Fund or the Transfer Agent.
You may modify or cancel your exercise of this Privilege at any time by
mailing written notification to The Dreyfus Family of Funds, P.O. Box 9671,
Providence, Rhode Island 02940-9671. The Fund may charge a service fee for
the use of this Privilege. No such fee currently is contemplated. For more
information concerning this Privilege and the funds in the Dreyfus Family of
Funds
Page 11
eligible to participate in this Privilege, or to obtain a Dreyfus
Auto-Exchange Authorization Form, please call toll free 1-800-645-6561. See
"Dividends, Distributions and Taxes."
DREYFUS-AUTOMATIC ASSET BUILDERRegistration Mark
Dreyfus-AUTOMATIC Asset Builder permits you to purchase Fund shares
(minimum of $100 and maximum of $150,000 per transaction) at regular
intervals selected by you. Fund shares are purchased by transferring funds
from the bank account designated by you. At your option, the account
designated by you will be debited in the specified amount, and Fund shares
will be purchased, once a month, on either the first or fifteenth day, or
twice a month, on both days. Only an account maintained at a domestic
financial institution which is an Automated Clearing House member may be so
designated. To establish a Dreyfus-AUTOMATIC Asset Builder account, you must
file an authorization form with the Transfer Agent. You may obtain the
necessary authorization form by calling 1-800-645-6561. You may cancel your
participation in this Privilege or change the amount of purchase at any time
by mailing written notification to The Dreyfus Family of Funds, P.O. Box
9671, Providence, Rhode Island 02940-9671, or, if for Dreyfus retirement plan
accounts, to The Dreyfus Trust Company, Custodian, P.O. Box 6427, Providence,
Rhode Island 02940-6427, and the notification will be effective three
business days following receipt. The Fund may modify or terminate this
Privilege at any time or charge a service fee. No such fee currently is
contemplated.
DREYFUS GOVERNMENT DIRECT DEPOSIT PRIVILEGE
Dreyfus Government Direct Deposit Privilege enables you to purchase
Fund shares (minimum of $100 and maximum of $50,000 per transaction) by
having Federal salary, Social Security, or certain veterans', military or
other payments from the Federal government automatically deposited into your
Fund account. You may deposit as much of such payments as you elect. To
enroll in Dreyfus Government Direct Deposit, you must file with the Transfer
Agent a completed Direct Deposit Sign-Up Form for each type of payment that
you desire to include in this Privilege. The appropriate form may be obtained
by calling 1-800-645-6561. Death or legal incapacity will terminate your
participation in this Privilege. You may elect at any time to terminate your
participation by notifying in writing the appropriate Federal agency. The
Fund may terminate your participation upon 30 days' notice to you.
DREYFUS PAYROLL SAVINGS PLAN
Dreyfus Payroll Savings Plan permits you to purchase Fund shares
(minimum of $100 per transaction) automatically on a regular basis. Depending
upon your employer's direct deposit program, you may have part or all of your
paycheck transferred to your existing Dreyfus account electronically through
the Automated Clearing House system at each pay period. To establish a
Dreyfus Payroll Savings Plan account, you must file an authorization form
with your employer's payroll department. Your employer must complete the
reverse side of the form and return it to The Dreyfus Family of Funds, P.O.
Box 9671, Providence, Rhode Island 02940-9671. You may obtain the necessary
authorization form by calling 1-800-645-6561. You may change the amount of
purchase or cancel the authorization only by written notification to your
employer. It is the sole responsibility of your employer, not the
Distributor, The Dreyfus Corporation, the Fund, the Transfer Agent or any
other person, to arrange for transactions under the Dreyfus Payroll Savings
Plan. The Fund may modify or terminate this Privilege at any time or charge a
service fee. No such fee currently is contemplated.
DREYFUS STEP PROGRAM
Dreyfus Step Program enables you to purchase Fund shares without
regard to the Fund's minimum initial investment requirements through Dreyfus-
AUTOMATIC Asset Builder, Dreyfus Government Direct Deposit Privilege or
Dreyfus Payroll Savings Plan. To establish a Dreyfus Step Program account,
you must supply the necessary information on the Account Application and file
the required authorization form(s) with the Transfer Agent. For more
information concerning this Program, or to request the necessary
authorization form(s), please call toll free 1-800-782-6620. You may
terminate your participation
Page 12
in this Program at any time by discontinuing your participation in
Dreyfus-AUTOMATIC Asset Builder, Dreyfus Government Direct Deposit Privilege
or Dreyfus Payroll Savings Plan, as the case may be, as provided under the
terms of such Privilege(s). The Fund may modify or terminate this Program at
any time. Investors who wish to purchase Fund shares through the Dreyfus Step
Program in conjunction with a Dreyfus-sponsored retirement plan may do so
only for IRAs, SEP-IRAs and IRA "Rollover Accounts."
DREYFUS DIVIDEND OPTIONS
Dreyfus Dividend Sweep enables you to invest automatically dividends
or dividends and capital gain distributions, if any, paid by the Fund in
shares of another fund in the Dreyfus Family of Funds of which you are a
shareholder. Shares of the other fund will be purchased at the then-current
net asset value; however, a sales load may be charged with respect to
investments in shares of a fund sold with a sales load. If you are investing
in a fund that charges a sales load, you may qualify for share prices which
do not include the sales load or which reflect a reduced sales load. If you
are investing in a fund that charges a contingent deferred sales charge, the
shares purchased will be subject on redemption to the contingent deferred
sales charge, if any, applicable to the purchased shares. See "Shareholder
Services" in the Statement of Additional Information. Dreyfus Dividend ACH
permits you to transfer electronically dividends or dividends and capital
gain distributions, if any, from the Fund to a designated bank account. Only
an account maintained at a domestic financial institution which is an
Automated Clearing House member may be so designated. Banks may charge a fee
for this service.
For more information concerning these privileges or to request a
Dividend Options Form, please call toll free 1-800-645-6561. You may cancel
these privileges by mailing written notification to The Dreyfus Family of
Funds, P.O. Box 9671, Providence, Rhode Island 02940-9671. To select a new
fund after cancellation, you must submit a new Dividend Options Form.
Enrollment in or cancellation of these privileges is effective three business
days following receipt. These privileges are available only for existing
accounts and may not be used to open new accounts. Minimum subsequent
investments do not apply for Dreyfus Dividend Sweep. The Fund may modify or
terminate these privileges at any time or charge a service fee. No such fee
currently is contemplated. Shares held under Keogh Plans, IRAs or other
retirement plans are not eligible for Dreyfus Dividend Sweep.
AUTOMATIC WITHDRAWAL PLAN
The Automatic Withdrawal Plan permits you to request withdrawal of a
specified dollar amount (minimum of $50) on either a monthly or quarterly
basis if you have a $5,000 minimum account. An application for the Automatic
Withdrawal Plan can be obtained by calling 1-800-645-6561. The Automatic
Withdrawal Plan may be ended at any time by you, the Fund or the Transfer
Agent. Shares for which certificates have been issued may not be redeemed
through the Automatic Withdrawal Plan.
RETIREMENT PLANS
The Fund offers a variety of pension and profit-sharing plans,
including Keogh Plans, IRAs, SEP-IRAs and IRA "Rollover Accounts," 401(k)
Salary Reduction Plans and 403(b)(7) Plans. Plan support services also are
available. You can obtain details on the various plans by calling the
following numbers toll free: for Keogh Plans, please call 1-800-358-5566;
for IRAs and IRA "Rollover Accounts," please call 1-800-645-6561; or for
SEP-IRAs, 401(k) Salary Reduction Plans and 403(b)(7) Plans, please call
1-800-322-7880.
HOW TO REDEEM SHARES
GENERAL
You may request redemption of your shares at any time. Redemption
requests should be transmitted to the Transfer Agent as described below. When
a request is received in proper form, the Fund will redeem the shares at the
next determined net asset value.
The Fund will deduct a redemption fee of 1% of the net asset value of
Fund shares redeemed or exchanged in less than six months following the
issuance of such shares. The fee will be retained by the Fund and used
primarily to offset the transaction costs that short-term trading imposes on
the Fund and its
Page 13
shareholders. For purposes of calculating the six-month holding period, the
Fund will employ the "first-in, first-out" method, which assumes that the
shares you are redeeming or exchanging are the ones you have held the longest.
No redemption fee will be charged on the redemption or exchange of shares (1)
through the Fund's Automatic Withdrawal Plan or Dreyfus Auto-Exchange
Privilege, (2) through accounts that are reflected on the records of the
Transfer Agent as omnibus accounts approved by Dreyfus Service Corporation,
(3) through accounts established by securities dealers, banks or other
financial institutions approved by Dreyfus Service Corporation that
utilize the National Securities Clearing Corporation's networking
system, or (4) acquired through the reinvestment of dividends or capital
gains distributions. The redemption fee may be waived, modified or
discontinued at any time or from time to time. No redemption fee will be
charged upon the redemption of shares acquired through reinvestment of
dividends or capital gain distributions, or shares redeemed through the
Fund's Automatic Withdrawal Plan or Dreyfus Auto-Exchange Privilege, or
through omnibus accounts for various retirement plans. The redemption fee may
be waived, modified or discontinued at any time or from time to time. Service
Agents may charge their clients a nominal fee for effecting redemptions of
Fund shares. Any certificates representing Fund shares being redeemed must be
submitted with the redemption request. The value of the shares redeemed may
be more or less than their original cost, depending upon the Fund's
then-current net asset value.
The Fund ordinarily will make payment for all shares redeemed within
seven days after receipt by the Transfer Agent of a redemption request in
proper form, except as provided by the rules of the Securities and Exchange
Commission. HOWEVER, IF YOU HAVE PURCHASED FUND SHARES BY CHECK, BY DREYFUS
TELETRANSFER PRIVILEGE OR THROUGH DREYFUS-AUTOMATIC ASSET BUILDERRegistration
Mark AND SUBSEQUENTLY SUBMIT A WRITTEN REDEMPTION REQUEST TO THE TRANSFER
AGENT, THE REDEMPTION PROCEEDS WILL BE TRANSMITTED TO YOU PROMPTLY UPON BANK
CLEARANCE OF YOUR PURCHASE CHECK, DREYFUS TELETRANSFER PURCHASE OR DREYFUS-
AUTOMATIC ASSET BUILDER ORDER, WHICH MAY TAKE UP TO EIGHT BUSINESS DAYS OR
MORE. IN ADDITION, THE FUND WILL REJECT REQUESTS TO REDEEM SHARES BY WIRE OR
TELEPHONE OR PURSUANT TO THE DREYFUS TELETRANSFER PRIVILEGE FOR A PERIOD OF
EIGHT BUSINESS DAYS AFTER RECEIPT BY THE TRANSFER AGENT OF THE PURCHASE
CHECK, THE DREYFUS TELETRANSFER PURCHASE OR THE DREYFUS-AUTOMATIC ASSET
BUILDER ORDER AGAINST WHICH SUCH REDEMPTION IS REQUESTED. THESE PROCEDURES
WILL NOT APPLY IF YOUR SHARES WERE PURCHASED BY WIRE PAYMENT, OR IF YOU
OTHERWISE HAVE A SUFFICIENT COLLECTED BALANCE IN YOUR ACCOUNT TO COVER THE
REDEMPTION REQUEST. PRIOR TO THE TIME ANY REDEMPTION IS EFFECTIVE, DIVIDENDS
ON SUCH SHARES WILL ACCRUE AND BE PAYABLE, AND YOU WILL BE ENTITLED TO
EXERCISE ALL OTHER RIGHTS OF BENEFICIAL OWNERSHIP. Fund shares will not be
redeemed until the Transfer Agent has received your Account Application.
The Fund reserves the right to redeem your account at its option upon
not less than 45 days' written notice if your account's net asset value is
$500 or less and remains so during the notice period.
PROCEDURES
You may redeem shares by using the regular redemption procedure
through the Transfer Agent, or, if you have checked the appropriate box and
supplied the necessary information on the Account Application or have filed a
Shareholder Services Form with the Transfer Agent, through the Wire Redemption
Privilege, the Telephone Redemption Privilege or the Dreyfus TELETRANSFER
Privilege. Other redemption procedures may be in effect for clients of
certain Service Agents. The Fund makes available to certain large
institutions the ability to issue redemption instructions through compatible
computer facilities. The Fund reserves the right to refuse any request made
by wire or telephone, including requests made shortly after a change of
address, and may limit the amount involved or the number of such requests.
The Fund may modify or terminate any redemption Privilege at any time or
charge a service fee upon notice to shareholders. No such fee currently is
contemplated. Shares held under Keogh Plans, IRAs or other retirement plans,
and shares for which certificates have been issued, are not eligible for the
Wire Redemption, Telephone Redemption or Dreyfus TELETRANSFER Privilege.
Page 14
You may redeem shares by telephone if you have checked the
appropriate box on the Account Application or have filed a Shareholder
Services Form with the Transfer Agent. If you select a telephone redemption
privilege or telephone exchange privilege (which is granted automatically
unless you refuse it), you authorize the Transfer Agent to act on telephone
instructions (including over The Dreyfus TouchRegistration Mark automated
telephone system) from any person representing himself or herself to be you,
and reasonably believed by the Transfer Agent to be genuine. The Fund will
require the Transfer Agent to employ reasonable procedures, such as requiring
a form of personal identification, to confirm that instructions are genuine
and, if it does not follow such procedures, the Fund or the Transfer Agent
may be liable for any losses due to unauthorized or fraudulent instructions.
Neither the Fund nor the Transfer Agent will be liable for following
telephone instructions reasonably believed to be genuine.
During times of drastic economic or market conditions, you may
experience difficulty in contacting the Transfer Agent by telephone to
request a redemption or exchange of Fund shares. In such cases, you should
consider using the other redemption procedures described herein. Use of these
other redemption procedures may result in your redemption request being
processed at a later time than it would have been if telephone redemption had
been used. During the delay, the Fund's net asset value may fluctuate.
REGULAR REDEMPTION -- Under the regular redemption procedure, you may redeem
shares by written request mailed to The Dreyfus Family of Funds, P.O. Box
9671, Providence, Rhode Island 02940-9671, or, if for Dreyfus retirement plan
accounts, to The Dreyfus Trust Company, Custodian, P.O. Box 6427, Providence,
Rhode Island 02940-6427. Redemption requests may be delivered in person only
to a Dreyfus Financial Center. THESE REQUESTS WILL BE FORWARDED TO THE FUND
AND WILL BE PROCESSED ONLY UPON RECEIPT THEREBY. For the location of the
nearest Dreyfus Financial Center, please call one of the telephone numbers
listed under "General Information." Redemption requests must be signed by
each shareholder, including each owner of a joint account, and each signature
must be guaranteed. The Transfer Agent has adopted standards and procedures
pursuant to which signature-guarantees in proper form generally will be
accepted from domestic banks, brokers, dealers, credit unions, national
securities exchanges, registered securities associations, clearing agencies
and savings associations, as well as from participants in the New York Stock
Exchange Medallion Signature Program, the Securities Transfer Agents
Medallion Program ("STAMP") and the Stock Exchanges Medallion Program. If you
have any questions with respect to signature-guarantees, please call one of
the telephone numbers listed under "General Information."
Redemption proceeds of at least $1,000 will be wired to any member
bank of the Federal Reserve System in accordance with a written
signature-guaranteed request.
WIRE REDEMPTION PRIVILEGE -- You may request by wire or telephone that
redemption proceeds (minimum $1,000) be wired to your account at a bank which
is a member of the Federal Reserve System, or a correspondent bank if your
bank is not a member. You also may direct that redemption proceeds be paid by
check (maximum $150,000 per day) made out to the owners of record and mailed
to your address. Redemption proceeds of less than $1,000 will be paid
automatically by check. Holders of jointly registered Fund or bank accounts
may have redemption proceeds of not more than $250,000 wired within any
30-day period. You may telephone redemption requests by calling
1-800-645-6561 or, if you are calling from overseas, call 516-794-5452. The
Statement of Additional Information sets forth instructions for transmitting
redemption requests by wire.
TELEPHONE REDEMPTION PRIVILEGE -- You may request by telephone that
redemption proceeds (maximum $150,000 per day) be paid by check and mailed to
your address. You may telephone redemption instructions by calling
1-800-645-6561 or, if you are calling from overseas, call 516-794-5452.
DREYFUS TELETRANSFER PRIVILEGE -- You may request by telephone that
redemption proceeds (minimum $500 per day) be transferred between your Fund
account and your bank account. Only a bank account maintained in a domestic
financial institution which is an Automated Clearing House member
Page 15
may be designated. Redemption proceeds will be on deposit in your account at
an Automated Clearing House member bank ordinarily two days after receipt of
the redemption request or, at your request, paid by check (maximum $150,000
per day) and mailed to your address. Holders of jointly registered Fund or
bank accounts may redeem through the Dreyfus TELETRANSFER Privilege for
transfer to their bank account not more than $250,000 within any 30-day
period.
If you have selected the Dreyfus TELETRANSFER Privilege, you may
request a Dreyfus TELETRANSFER redemption of shares by calling 1-800-645-6561
or, if you are calling from overseas, call 516-794-5452.
SHAREHOLDER SERVICES PLAN
The Fund has adopted a Shareholder Services Plan, pursuant to which
it pays the Distributor for the provision of certain services to Fund
shareholders a fee at the annual rate of .25 of 1% of the value of the Fund's
average daily net assets. The services provided may include personal services
relating to shareholder accounts, such as answering shareholder inquiries
regarding the Fund and providing reports and other information, and services
related to the maintenance of shareholder accounts. The Distributor may make
payments to Service Agents in respect of these services. The Distributor
determines the amounts to be paid to Service Agents.
DIVIDENDS, DISTRIBUTIONS AND TAXES
Under the Internal Revenue Code of 1986, as amended (the "Code"), the
Fund is treated as a separate entity for purposes of qualification and
taxation as a regulated investment company. The Fund ordinarily pays
dividends from its net investment income and distributes net realized
securities gains, if any, once a year, but it may make distributions on a
more frequent basis to comply with the distribution requirements of the Code,
in all events in a manner consistent with the provisions of the 1940 Act. The
Fund will not make distributions from net realized securities gains unless
capital loss carryovers, if any, have been utilized or have expired. You may
choose whether to receive dividends and distributions in cash or to reinvest
in additional shares at net asset value. All expenses are accrued daily and
deducted before declaration of dividends to investors.
Dividends derived from net investment income, together with
distributions from net realized short-term securities gains and all or a
portion of any gains realized from the sale or other disposition of certain
market discount bonds, paid by the Fund will be taxable to U.S. shareholders
as ordinary income whether received in cash or reinvested in additional
shares. Distributions from net realized long-term securities gains of the
Fund will be taxable to U.S. shareholders as long-term capital gains for
Federal income tax purposes, regardless of how long shareholders have held
their Fund shares and whether such distributions are received in cash or
reinvested in Fund shares. The Code provides that the net capital gain of an
individual generally will not be subject to Federal income tax at a rate in
excess of 28%. Dividends and distributions may be subject to state and local
taxes.
Dividends derived from net investment income, together with
distributions from net realized short-term securities gains and all or a
portion of any gains realized from the sale or other disposition of certain
market discount bonds, paid by the Fund to a foreign investor generally are
subject to U.S. nonresident withholding taxes at the rate of 30%, unless the
foreign investor claims the benefit of a lower rate specified in a tax
treaty. Distributions from net realized long-term securities gains paid by
the Fund to a foreign investor as well as the proceeds of any redemptions
from a foreign investor's account, regardless of the extent to which gain or
loss may be realized, generally will not be subject to U.S. nonresident
withholding tax. However, such distributions may be subject to backup
withholding, as described below, unless the foreign investor certifies his
non-U.S. residency status.
Notice as to the tax status of your dividends and distributions will
be mailed to you annually. You also will receive periodic summaries of your
account which will include information as to dividends and distributions from
securities gains, if any, paid during the year.
Page 16
The exchange of shares of one fund for shares of another is treated
for Federal income tax purposes as a sale of the shares given in exchange by
the shareholder and, therefore, an exchanging shareholder may realize a
taxable gain or loss.
Federal regulations generally require the Fund to withhold ("backup
withholding") and remit to the U.S. Treasury 31% of dividends, distributions
from net realized securities gains and the proceeds of any redemption,
regardless of the extent to which gain or loss may be realized, paid to a
shareholder if such shareholder fails to certify either that the TIN
furnished in connection with opening an account is correct or that such
shareholder has not received notice from the IRS of being subject to backup
withholding as a result of a failure to properly report taxable dividend or
interest income on a Federal income tax return. Furthermore, the IRS may
notify the Fund to institute backup withholding if the IRS determines a
shareholder's TIN is incorrect or if a shareholder has failed to properly
report taxable dividend and interest income on a Federal income tax return.
A TIN is either the Social Security number or employer identification
number of the record owner of the account. Any tax withheld as a result of
backup withholding does not constitute an additional tax imposed on the
record owner of the account, and may be claimed as a credit on the record
owner's Federal income tax return.
It is expected that the Fund will qualify as a "regulated investment
company" under the Code so long as such qualification is in the best
interests of its shareholders. Such qualification relieves the Fund of any
liability for Federal income tax to the extent its earnings are distributed
in accordance with applicable provisions of the Code. The Fund is subject to
a non-deductible 4% excise tax, measured with respect to certain
undistributed amounts of taxable investment income and capital gains.
You should consult your tax adviser regarding specific questions as
to Federal, state or local taxes.
PERFORMANCE INFORMATION
For purposes of advertising, performance may be calculated on the
basis of average annual total return and/or total return.
Average annual total return is calculated pursuant to a standardized
formula which assumes that an investment was purchased with an initial
payment of $1,000 and that the investment was redeemed at the end of a stated
period of time, after giving effect to the reinvestment of dividends and
distributions during the period. The return is expressed as a percentage rate
which, if applied on a compounded annual basis, would result in the
redeemable value of the investment at the end of the period. Advertisements
of the Fund's performance will include the Fund's average annual total return
for one, five and ten year periods, or for shorter periods depending upon the
length of time during which the Fund has operated.
Total return is computed on a per share basis and assumes the
reinvestment of dividends and distributions. Total return generally is
expressed as a percentage rate which is calculated by combining the income
and principal changes for a specified period and dividing by the net asset
value per share at the beginning of the period. Advertisements may include
the percentage rate of total return or may include the value of a
hypothetical investment at the end of the period which assumes the
application of the percentage rate of total return.
Performance will vary from time to time and past results are not
necessarily representative of future results. You should remember that
performance is a function of portfolio management in selecting the type and
quality of portfolio securities and is affected by operating expenses.
Performance information, such as that described above, may not provide a
basis for comparison with other investments or other investment companies
using a different method of calculating performance.
Comparative performance information may be used from time to time in
advertising or marketing the Fund's shares, including data from Lipper
Analytical Services, Inc., MSCI-Emerging Markets Index, Standard & Poor's 500
Stock Index, Standard & Poor's MidCap 400 Index, Wilshire 5000 Index, the Dow
Jones Industrial Average, MONEY MAGAZINE, Morningstar, Inc. and other
industry publications.
Page 17
GENERAL INFORMATION
The Company was incorporated under Maryland law on January 27, 1993
and commenced operations on June 29, 1993. Before June 24, 1996, the
Company's name was Dreyfus International Equity Fund, Inc. The Company is
authorized to issue 400 million shares of Common Stock (with 100 million
shares allocated to the Fund), par value $.001 per share. Each share has one
vote.
Unless otherwise required by the 1940 Act, ordinarily it will not be
necessary for the Fund to hold annual meetings of shareholders. As a result,
Fund shareholders may not consider each year the election of Board members or
the appointment of auditors. However, pursuant to the Company's By-Laws, the
holders of at least 10% of the shares outstanding and entitled to vote may
require the Company to hold a special meeting of shareholders for purposes of
removing a Board member from office or for any other purpose. Shareholders
may remove a Board member by the affirmative vote of a majority of the
Company's outstanding voting shares. In addition, the Board will call a
meeting of shareholders for the purpose of electing Board members if, at any
time, less than a majority of the Board members then holding office have been
elected by shareholders.
The Company is a "series fund," which is a mutual fund divided into
separate portfolios, each of which is treated as a separate entity for
certain matters under the 1940 Act and for other purposes. A shareholder of
one portfolio is not deemed to be a shareholder of any other portfolio. For
certain matters shareholders vote together as a group; as to others they vote
separately by portfolio. By this Prospectus, shares of the Fund are being
offered. Other portfolios are sold pursuant to other offering documents.
To date, the Board has authorized the creation of two series of
shares. All consideration received by the Company for shares of one of the
series and all assets in which such consideration is invested will belong to
that series (subject only to the rights of creditors of the Company) and will
be subject to the liabilities related thereto. The income attributable to,
and the expenses of, one series are treated separately from those of the
other series. The Company has the ability to create, from time to time, new
series without shareholder approval.
The Transfer Agent maintains a record of your ownership and sends you
confirmations and statements of account.
Shareholder inquiries may be made by writing to the Fund at 144 Glenn
Curtiss Boulevard, Uniondale, New York 11556-0144, or by calling toll free
1-800-645-6561. In New York City, call
1-718-895-1206; outside the U.S. and Canada, call 516-794-5452.
Page 18
APPENDIX
INVESTMENT TECHNIQUES
FOREIGN CURRENCY TRANSACTIONS -- Foreign currency transactions may be entered
into for a variety of purposes, including: to fix in U.S. dollars, between
trade and settlement date, the value of a security the Fund has agreed to buy
or sell; to hedge the U.S. dollar value of securities the Fund already owns,
particularly if it expects a decrease in the value of the currency in which
the foreign security is denominated; or to gain exposure to the foreign
currency in an attempt to realize gains.
Foreign currency transactions may involve, for example, the Fund's
purchase of foreign currencies for U.S. dollars or the maintenance of short
positions in foreign currencies, which would involve the Fund agreeing to
exchange an amount of a currency it did not currently own for another
currency at a future date in anticipation of a decline in the value of the
currency sold relative to the currency the Fund contracted to receive in the
exchange. The Fund's success in these transactions will depend principally on
The Dreyfus Corporation's ability to predict accurately the future exchange
rates between foreign currencies and the U.S. dollar.
SHORT-SELLING -- In these transactions, the Fund sells a security it does not
own in anticipation of a decline in the market value of the security. To
complete the transaction, the Fund must borrow the security to make delivery
to the buyer. The Fund is obligated to replace the security borrowed by
purchasing it subsequently at the market price at the time of replacement.
The price at such time may be more or less than the price at which the
security was sold by the Fund, which would result in a loss or gain,
respectively.
Securities will not be sold short if, after effect is given to any
such short sale, the total market value of all securities sold short would
exceed 25% of the value of the Fund's net assets. The Fund may not sell short
the securities of any single issuer listed on a national securities exchange
to the extent of more than 5% of the value of the Fund's net assets. The Fund
may not make a short sale which results in the Fund having sold short in the
aggregate more than 5% of the outstanding securities of any class of an
issuer.
The Fund also may make short sales "against the box," in which the
Fund enters into a short sale of a security it owns in order to hedge an
unrealized gain on the security. At no time will more than 15% of the value
of the Fund's net assets be in deposits on short sales against the box.
BORROWING MONEY -- The Fund is permitted to borrow to the extent permitted
under the 1940 Act, which permits an investment company to borrow in an
amount up to 331/3% of the value of its total assets. The Fund currently
intends to borrow money only for temporary or emergency (not leveraging)
purposes, in an amount up to 15% of the value of its total assets (including
the amount borrowed) valued at the lesser of cost or market, less liabilities
(not including the amount borrowed) at the time the borrowing is made. While
borrowings exceed 5% of the Fund's total assets, the Fund will not make any
additional investments.
USE OF DERIVATIVES -- The Fund may invest in the types of Derivatives
enumerated under "Description of the Fund -- Investment Considerations and
Risks -- Use of Derivatives." These instruments and certain related risks are
described more specifically under "Investment Objective and Management
Policies -- Management Policies -- Derivatives" in the Statement of
Additional Information.
Derivatives can be volatile and involve various types and degrees of
risk, depending upon the characteristics of the particular Derivative and the
portfolio as a whole. Derivatives permit the Fund to increase or decrease the
level of risk, or change the character of the risk, to which its portfolio is
exposed in much the same way as the Fund can increase or decrease the level
of risk, or change the character of the risk, of its portfolio by making
investments in specific securities.
Derivatives may entail investment exposures that are greater than
their cost would suggest, meaning that a small investment in Derivatives
could have a large potential impact on the Fund's performance.
If the Fund invests in Derivatives at inappropriate times or judges
market conditions incorrectly, such investments may lower the Fund's return
or result in a loss. The Fund also could experience losses
Page 19
if it were unable to liquidate its position because of an illiquid secondary
market. The market for many Derivatives is, or suddenly can become, illiquid.
Changes in liquidity may result in significant, rapid and unpredictable
changes in the prices for Derivatives.
Although the Fund will not be a commodity pool, Derivatives subject
the Fund to the rules of the Commodity Futures Trading Commission which limit
the extent to which the Fund can invest in certain Derivatives. The Fund may
invest in futures contracts and options with respect thereto for hedging
purposes without limit. However, the Fund may not invest in such contracts
and options for other purposes if the sum of the amount of initial margin
deposits and premiums paid for unexpired options with respect to such
contracts, other than for bona fide hedging purposes, exceeds 5% of the
liquidation value of the Fund's assets, after taking into account unrealized
profits and unrealized losses on such contracts and options; provided,
however, that in the case of an option that is in-the-money at the time of
purchase, the in-the-money amount may be excluded in calculating the 5%
limitation.
The Fund may invest up to 5% of its assets, represented by the
premium paid, in the purchase of call and put options. The Fund may write
(i.e., sell) covered call and put option contracts to the extent of 20% of
the value of its net assets at the time such option contracts are written.
When required by the Securities and Exchange Commission, the Fund will set
aside permissible liquid assets in a segregated account to cover its
obligations relating to its transactions in Derivatives. To maintain this requ
ired cover, the Fund may have to sell portfolio securities at disadvantageous
prices or times since it may not be possible to liquidate a Derivative
position at a reasonable price.
CERTAIN PORTFOLIO SECURITIES
CLOSED-END INVESTMENT COMPANIES -- The Fund may invest in securities issued
by closed-end investment companies which principally invest in securities in
which the Fund invests. Under the 1940 Act, the Fund's investment in such
securities, subject to certain exceptions, currently is limited to (i) 3% of
the total voting stock of any one investment company, (ii) 5% of the Fund's
total assets with respect to any one investment company and (iii) 10% of the
Fund's total assets in the aggregate. Investments in the securities of other
investment companies may involve duplication of advisory fees and certain
other expenses.
FOREIGN GOVERNMENT OBLIGATIONS; SECURITIES OF SUPRANATIONAL ENTITIES -- The
Fund may invest in obligations issued or guaranteed by one or more foreign
governments or any of their political subdivisions, agencies or
instrumentalities that are determined by The Dreyfus Corporation to be of
comparable quality to the other obligations in which the Fund may invest.
Supranational entities include international organizations designated or
supported by governmental entities to promote economic reconstruction or
development and international banking institutions and related government
agencies. Examples include the International Bank for Reconstruction and
Development (the World Bank), the European Coal and Steel Community, the
Asian Development Bank and the InterAmerican Development Bank.
MONEY MARKET INSTRUMENTS -- The Fund may invest in the following types of
money market instruments.
U.S. GOVERNMENT SECURITIES. Securities issued or guaranteed by the
U.S. Government or its agencies or instrumentalities include U.S. Treasury
securities that differ in their interest rates, maturities and times of
issuance. Some obligations issued or guaranteed by U.S. Government agencies
and instrumentalities are supported by the full faith and credit of the U.S.
Treasury; others by the right of the issuer to borrow from the Treasury;
others by discretionary authority of the U.S. Government to purchase certain
obligations of the agency or instrumentality; and others only by the credit
of the agency or instrumentality. These securities bear fixed, floating or
variable rates of interest. While the U.S. Government provides financial
support to such U.S. Government-sponsored agencies and instrumentalities, no
assurance can be given that it will always do so since it is not so obligated
by law.
REPURCHASE AGREEMENTS. In a repurchase agreement, the Fund buys, and
the seller agrees to repurchase, a security at a mutually agreed upon time
and price (usually within seven days). The repur-
Page 20
chase agreement thereby determines the yield during the purchaser's holding
period, while the seller's obligation to repurchase is secured by the value of
the underlying security. Repurchase agreements could involve risks in the
event of a default or insolvency of the other party to the agreement,
including possible delays or restrictions upon the Fund's ability to dispose
of the underlying securities. The Fund may enter into repurchase agreements
with certain banks or non-bank dealers.
BANK OBLIGATIONS. The Fund may purchase certificates of deposit, time
deposits, bankers' acceptances and other short-term obligations issued by
domestic banks, foreign subsidiaries or foreign branches of domestic banks,
domestic and foreign branches of foreign banks, domestic savings and loan
associations and other banking institutions. With respect to such securities
issued by foreign subsidiaries or foreign branches of domestic banks, and
domestic and foreign branches of foreign banks, the Fund may be subject to
additional investment risks that are different in some respects from those
incurred by a fund which invests only in debt obligations of U.S. domestic
issuers. See "Description of the Fund -- Investment Considerations and Risks
- -- Foreign Securities."
Certificates of deposit are negotiable certificates evidencing the
obligation of a bank to repay funds deposited with it for a specified period
of time.
Time deposits are non-negotiable deposits maintained in a banking
institution for a specified period of time (in no event longer than seven
days) at a stated interest rate.
Bankers' acceptances are credit instruments evidencing the obligation
of a bank to pay a draft drawn on it by a customer. These instruments reflect
the obligation both of the bank and the drawer to pay the face amount of the
instrument upon maturity. The other short-term obligations may include
uninsured, direct obligations bearing fixed, floating or variable interest
rates.
COMMERCIAL PAPER. Commercial paper consists of short-term, unsecured
promissory notes issued to finance short-term credit needs. The commercial
paper purchased by the Fund will consist only of direct obligations which, at
the time of their purchase, are (a) rated not lower than Prime-1 by Moody's
Investors Service, Inc. ("Moody's") or A-1 by Standard & Poor's Ratings Group
("S&P"), (b) issued by companies having an outstanding unsecured debt issue
currently rated at least A3 by Moody's or A- by S&P, or (c) if unrated,
determined by The Dreyfus Corporation to be of comparable quality to those
rated obligations which may be purchased by the Fund.
ILLIQUID SECURITIES -- The Fund may invest up to 15% of the value of its net
assets in securities as to which a liquid trading market does not exist,
provided such investments are consistent with the Fund's investment
objective. Such securities may include securities that are not readily
marketable, such as certain securities that are subject to legal or
contractual restrictions on resale, repurchase agreements providing for
settlement in more than seven days after notice, and certain privately
negotiated, non-exchange traded options and securities used to cover such
options. As to these securities, the Fund is subject to a risk that should
the Fund desire to sell them when a ready buyer is not available at a price
the Fund deems representative of their value, the value of the Fund's net
assets could be adversely affected.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND IN THE
FUND'S OFFICIAL SALES LITERATURE IN CONNECTION WITH THE OFFER OF THE FUND'S
SHARES, AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND. THIS PROSPECTUS
DOES NOT CONSTITUTE AN OFFER IN ANY STATE IN WHICH, OR TO ANY PERSON TO WHOM,
SUCH OFFERING MAY NOT LAWFULLY BE MADE.
Page 21
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Page 23
Emerging
Markets
Fund
Prospectus
Registration Mark
Copy Rights 1997 Dreyfus Service Corporation
327p011597
Page 24
DREYFUS INTERNATIONAL FUNDS, INC.
DREYFUS INTERNATIONAL GROWTH FUND
DREYFUS EMERGING MARKETS FUND
PART B
(STATEMENT OF ADDITIONAL INFORMATION)
JANUARY 15, 1997
This Statement of Additional Information, which is not a prospectus,
supplements and should be read in conjunction with the current Prospectus
of Dreyfus International Growth Fund dated October 1, 1996 and Dreyfus
Emerging Markets Fund dated January 15, 1997 (each, a "Fund" and
collectively, the "Funds") of Dreyfus International Funds, Inc. (the
"Company"), respectively, as each may be revised from time to time. To
obtain a copy of the relevant Fund's Prospectus, please write to a Fund at
144 Glenn Curtiss Boulevard, Uniondale, New York 11556-0144, or call the
following numbers:
Call Toll Free 1-800-645-6561
In New York City -- Call 1-718-895-1206
Outside the U.S. and Canada -- Call 516-794-5452
The Dreyfus Corporation (the "Manager") serves as each Fund's
investment adviser.
Premier Mutual Fund Services, Inc. (the "Distributor") is the
distributor of each Fund's shares.
TABLE OF CONTENTS
Page
Investment Objective and Management Policies. . . . . . . . B-2
Management of the Company . . . . . . . . . . . . . . . . . B-11
Management Agreement. . . . . . . . . . . . . . . . . . . . B-15
Purchase of Shares. . . . . . . . . . . . . . . . . . . . . B-17
Distribution Plan and Shareholder Services Plan . . . . . . B-18
Redemption of Shares. . . . . . . . . . . . . . . . . . . . B-20
Shareholder Services. . . . . . . . . . . . . . . . . . . . B-22
Determination of Net Asset Value. . . . . . . . . . . . . . B-25
Dividends, Distributions and Taxes. . . . . . . . . . . . . B-26
Portfolio Transactions. . . . . . . . . . . . . . . . . . . B-28
Performance Information . . . . . . . . . . . . . . . . . . B-29
Information About the Funds . . . . . . . . . . . . . . . . B-30
Transfer and Dividend Disbursing Agent,
Custodian, Counsel and Independent Auditors . . . . . . . B-30
Appendix. . . . . . . . . . . . . . . . . . . . . . . . . . B-32
Financial Statements. . . . . . . . . . . . . . . . . . . . B-37
Report of Independent Auditors. . . . . . . . . . . . . . . B-49
INVESTMENT OBJECTIVE AND MANAGEMENT POLICIES
The following information supplements and should be read in
conjunction with the sections in each Fund's Prospectus entitled
"Description of the Fund" and "Appendix."
Portfolio Securities
Depositary Receipts. These securities may be purchased through
"sponsored" or "unsponsored" facilities. A sponsored facility is
established jointly by the issuer of the underlying security and a
depositary, whereas a depositary may establish an unsponsored facility
without participation by the issuer of the deposited security. Holders of
unsponsored depositary receipts generally bear all the costs of such
facilities and the depositary of an unsponsored facility frequently is
under no obligation to distribute shareholder communications received from
the issuer of the deposited security or to pass through voting rights to
the holders of such receipts in respect of the deposited securities.
Repurchase Agreements. The Funds' custodian or sub-custodian will
have custody of, and will hold in a segregated account, securities acquired
by a Fund under a repurchase agreement. Repurchase agreements are
considered by the staff of the Securities and Exchange Commission to be
loans by the Fund. In an attempt to reduce the risk of incurring a loss on
a repurchase agreement, each Fund will enter into repurchase agreements
only with domestic banks with total assets in excess of $1 billion, or
primary government securities dealers reporting to the Federal Reserve Bank
of New York, with respect to securities of the type in which the Fund may
invest, and will require that additional securities be deposited with it if
the value of the securities purchased should decrease below the resale
price.
Commercial Paper and Other Short-Term Corporate Obligations. These
instruments include variable amount master demand notes, which are
obligations that permit a Fund to invest fluctuating amounts at varying
rates of interest pursuant to direct arrangements between the Fund, as
lender, and the borrower. These notes permit daily changes in the amounts
borrowed. Because these obligations are direct lending arrangements
between the lender and borrower, it is not contemplated that such
instruments generally will be traded, and there generally is no established
secondary market for these obligations, although they are redeemable at
face value, plus accrued interest, at any time. Accordingly, where these
obligations are not secured by letters of credit or other credit support
arrangements, the Fund's right to redeem is dependent on the ability of the
borrower to pay principal and interest on demand. Such obligations
frequently are not rated by credit rating agencies, and a Fund may invest
in them only if at the time of an investment the borrower meets the
criteria set forth in the Fund's Prospectus for other commercial paper
issuers.
Convertible Securities. Convertible securities may be converted at
either a stated price or stated rate into underlying shares of common
stock. Convertible securities have characteristics similar to both fixed-
income and equity securities. Convertible securities generally are
subordinated to other similar but non-convertible securities of the same
issuer, although convertible bonds, as corporate debt obligations, enjoy
seniority in right of payment to all equity securities, and convertible
preferred stock is senior to common stock, of the same issuer. Because of
the subordination feature, however, convertible securities typically have
lower ratings than similar non-convertible securities.
Although to a lesser extent than with fixed-income securities, the
market value of convertible securities tends to decline as interest rates
increase and, conversely, tends to increase as interest rates decline. In
addition, because of the conversion feature, the market value of
convertible securities tends to vary with fluctuations in the market value
of the underlying common stock. A unique feature of convertible securities
is that as the market price of the underlying common stock declines,
convertible securities tend to trade increasingly on a yield basis, and so
may not experience market value declines to the same extent as the
underlying common stock. When the market price of the underlying common
stock increases, the prices of the convertible securities tend to rise as a
reflection of the value of the underlying common stock. While no
securities investments are without risk, investments in convertible
securities generally entail less risk than investments in common stock of
the same issuer.
Convertible securities are investments that provide for a stable
stream of income with generally higher yields than common stocks. There
can be no assurance of current income because the issuers of the
convertible securities may default on their obligations. A convertible
security, in addition to providing fixed income, offers the potential for
capital appreciation through the conversion feature, which enables the
holder to benefit from increases in the market price of the underlying
common stock. There can be no assurance of capital appreciation, however,
because securities prices fluctuate. Convertible securities, however,
generally offer lower interest or dividend yields than non-convertible
securities of similar quality because of the potential for capital
appreciation.
Illiquid Securities. When purchasing securities that have not been
registered under the Securities Act of 1933, as amended, and are not
readily marketable, each Fund will endeavor, to the extent practicable, to
obtain the right to registration at the expense of the issuer. Generally,
there will be a lapse of time between the Fund's decision to sell any such
security and the registration of the security permitting sale. During any
such period, the price of the securities will be subject to market
fluctuations. However, where a substantial market of qualified
institutional buyers has developed for certain unregistered securities
purchased by the Fund pursuant to Rule 144A under the Securities Act of
1933, as amended, the Fund intends to treat such securities as liquid
securities in accordance with procedures approved by the Company's Board.
Because it is not possible to predict with assurance how the market for
specific restricted securities sold pursuant to Rule 144A will develop, the
Company's Board has directed the Manager to monitor carefully the relevant
Fund's investments in such securities with particular regard to trading
activity, availability of reliable price information and other relevant
information. To the extent that, for a period of time, qualified
institutional buyers cease purchasing restricted securities pursuant to
Rule 144A, a Fund's investing in such securities may have the effect of
increasing the level of illiquidity in its investment portfolio during such
period.
Management Policies
Leverage. For borrowings for investment purposes, the Investment
Company Act of 1940, as amended (the "1940 Act"), requires the Fund to
maintain continuous asset coverage (that is, total assets including
borrowings, less liabilities exclusive of borrowings) of 300% of the amount
borrowed. If the required coverage should decline as a result of market
fluctuations or other reasons, the Fund may be required to sell some of its
portfolio securities within three days to reduce the amount of its
borrowings and restore the 300% asset coverage, even though it may be
disadvantageous from an investment standpoint to sell securities at that
time. The Fund also may be required to maintain minimum average balances
in connection with such borrowing or pay a commitment or other fee to
maintain a line of credit; either of these requirements would increase the
cost of borrowing over the stated interest rate. To the extent the Fund
enters into a reverse repurchase agreement, the Fund will maintain in a
segregated custodial account permissible liquid assets at least equal to
the aggregate amount of its reverse repurchase obligations, plus accrued
interest, in certain cases, in accordance with releases promulgated by the
Securities and Exchange Commission. The Securities and Exchange Commission
views reverse repurchase transactions as collateralized borrowings by the
Fund.
Short-Selling. In these transactions, a Fund sells a security it does
not own in anticipation of a decline in the market value of the security.
To complete the transaction, the Fund must borrow the security to make
delivery to the buyer. The Fund is obligated to replace the security
borrowed by purchasing it subsequently at the market price at the time of
replacement. The price at such time may be more or less than the price at
which the security was sold by the Fund, which would result in a loss or
gain, respectively.
Securities will not be sold short if, after effect is given to any
such short sale, the total market value of all securities sold short would
exceed 25% of the value of a Fund's net assets. A Fund may not sell short
the securities of any single issuer listed on a national securities
exchange to the extent of more than 5% of the value of a Fund's net assets.
A Fund may not make a short sale which results in the Fund having sold
short in the aggregate more than 5% of the outstanding securities of any
class of an issuer.
A Fund also may make short sales "against the box," in which the Fund
enters into a short sale of a security it owns in order to hedge an
unrealized gain on the security. At no time will more than 15% of the
value of the Fund's net assets be in deposits on short sales against the
box.
Until a Fund closes its short position or replaces the borrowed
security, it will: (a) maintain a segregated account containing
permissible liquid assets at such a level that the amount deposited in the
account plus the amount deposited with the broker as collateral always
equals the current value of the security sold short; or (b) otherwise cover
its short position.
Lending Portfolio Securities. (Dreyfus International Growth Fund
only) In connection with its securities lending transactions, Dreyfus
International Growth Fund may return to the borrower or a third party which
is unaffiliated with the Fund, and which is acting as a "placing broker," a
part of the interest earned from the investment of collateral received for
securities loaned.
The Securities and Exchange Commission currently requires that the
following conditions must be met whenever portfolio securities are loaned:
(1) the Fund must receive at least 100% cash collateral from the borrower;
(2) the borrower must increase such collateral whenever the market value of
the securities rises above the level of such collateral; (3) the Fund must
be able to terminate the loan at any time; (4) the Fund must receive
reasonable interest on the loan, as well as any dividends, interest or
other distributions payable on the loaned securities, and any increase in
market value; (5) the Fund may pay only reasonable custodian fees in
connection with the loan; and (6) while voting rights on the loaned
securities may pass to the borrower, the Company's Board must terminate the
loan and regain the right to vote the securities if a material event
adversely affecting the investment occurs.
Derivatives. A Fund may invest in Derivatives (as defined in the
relevant Fund's Prospectus) for a variety of reasons, including to hedge
certain market risks, to provide a substitute for purchasing or selling
particular securities or to increase potential income gain. Derivatives
may provide a cheaper, quicker or more specifically focused way for the
Fund to invest than "traditional" securities would.
Derivatives can be volatile and involve various types and degrees of
risk, depending upon the characteristics of the particular Derivative and
the portfolio as a whole. Derivatives permit a Fund to increase or
decrease the level of risk, or change the character of the risk, to which
its portfolio is exposed in much the same way as the Fund can increase or
decrease the level of risk, or change the character of the risk, of its
portfolio by making investments in specific securities.
Derivatives may entail investment exposures that are greater than
their cost would suggest, meaning that a small investment in Derivatives
could have a large potential impact on a Fund's performance.
If a Fund invests in Derivatives at inappropriate times or judges
market conditions incorrectly, such investments may lower the Fund's return
or result in a loss. A Fund also could experience losses if its
Derivatives were poorly correlated with its other investments, or if the
Fund were unable to liquidate its position because of an illiquid secondary
market. The market for many Derivatives is, or suddenly can become,
illiquid. Changes in liquidity may result in significant, rapid and
unpredictable changes in the prices for Derivatives.
A Fund may invest up to 5% of its assets, represented by the premium
paid, in the purchase of call and put options. A Fund may write (i.e.,
sell) covered call and put option contracts to the extent of 20% of the
value of its net assets at the time such option contracts are written.
When required by the Securities and Exchange Commission, a Fund will set
aside permissible liquid assets in a segregated account to cover its
obligations relating to its purchase of Derivatives. To maintain this
required cover, a Fund may have to sell portfolio securities at
disadvantageous prices or times since it may not be possible to liquidate a
Derivative position at a reasonable price. Derivatives may be purchased on
established exchanges or through privately negotiated transactions referred
to as over-the-counter Derivatives. Exchange-traded Derivatives generally
are guaranteed by the clearing agency which is the issuer or counterparty
to such Derivatives. This guarantee usually is supported by a daily
payment system (i.e., variation margin requirements) operated by the
clearing agency in order to reduce overall credit risk. As a result,
unless the clearing agency defaults, there is relatively little
counterparty credit risk associated with Derivatives purchased on an
exchange. By contrast, no clearing agency guarantees over-the-counter
Derivatives. Therefore, each party to an over-the-counter Derivative bears
the risk that the counterparty will default. Accordingly, the Manager will
consider the creditworthiness of counterparties to over-the-counter
Derivatives in the same manner as it would review the credit quality of a
security to be purchased by a Fund. Over-the-counter Derivatives are less
liquid than exchange-traded Derivatives since the other party to the
transaction may be the only investor with sufficient understanding of the
Derivative to be interested in bidding for it.
Futures Transactions--In General. A Fund may enter into futures contracts
in U.S. domestic markets, such as the Chicago Board of Trade and the
International Monetary Market of the Chicago Mercantile Exchange, or, if
permitted in its Prospectus, on exchanges located outside the United
States, such as the London International Financial Futures Exchange and the
Sydney Futures Exchange Limited. Foreign markets may offer advantages such
as trading opportunities or arbitrage possibilities not available in the
United States. Foreign markets, however, may have greater risk potential
than domestic markets. For example, some foreign exchanges are principal
markets so that no common clearing facility exists and an investor may look
only to the broker for performance of the contract. In addition, any
profits that a Fund might realize in trading could be eliminated by adverse
changes in the exchange rate, or the Fund could incur losses as a result of
those changes. Transactions on foreign exchanges may include both
commodities which are traded on domestic exchanges and those which are not.
Unlike trading on domestic commodity exchanges, trading on foreign
commodity exchanges is not regulated by the Commodity Futures Trading
Commission.
Engaging in these transactions involves risk of loss to a Fund which
could adversely affect the value of the Fund's net assets. Although each
Fund intends to purchase or sell futures contracts only if there is an
active market for such contracts, no assurance can be given that a liquid
market will exist for any particular contract at any particular time. Many
futures exchanges and boards of trade limit the amount of fluctuation
permitted in futures contract prices during a single trading day. Once the
daily limit has been reached in a particular contract, no trades may be
made that day at a price beyond that limit or trading may be suspended for
specified periods during the trading day. Futures contract prices could
move to the limit for several consecutive trading days with little or no
trading, thereby preventing prompt liquidation of futures positions and
potentially subjecting the Fund to substantial losses.
Successful use of futures by a Fund also is subject to the Manager's
ability to predict correctly movements in the direction of the relevant
market and, to the extent the transaction is entered into for hedging
purposes, to ascertain the appropriate correlation between the transaction
being hedged and the price movements of the futures contract. For example,
if a Fund uses futures to hedge against the possibility of a decline in the
market value of securities held in its portfolio and the prices of such
securities instead increase, the Fund will lose part or all of the benefit
of the increased value of securities which it has hedged because it will
have offsetting losses in its futures positions. Furthermore, if in such
circumstances the Fund has insufficient cash, it may have to sell
securities to meet daily variation margin requirements. A Fund may have to
sell such securities at a time when it may be disadvantageous to do so.
Pursuant to regulations and/or published positions of the Securities
and Exchange Commission, a Fund may be required to segregate permissible
liquid assets in connection with its commodities transactions in an amount
generally equal to the value of the underlying commodity. The segregation
of such assets will have the effect of limiting a Fund's ability otherwise
to invest those assets.
Specific Futures Transactions. A Fund may purchase and sell stock index
futures contracts. A stock index future obligates the Fund to pay or
receive an amount of cash equal to a fixed dollar amount specified in the
futures contract multiplied by the difference between the settlement price
of the contract on the contract's last trading day and the value of the
index based on the stock prices of the securities that comprise it at the
opening of trading in such securities on the next business day.
A Fund may purchase and sell currency futures. A foreign currency
future obligates the Fund to purchase or sell an amount of a specific
currency at a future date at a specific price.
Dreyfus International Growth Fund may purchase and sell interest rate
futures contracts. An interest rate future obligates the Fund to purchase
or sell an amount of a specific debt security at a future date at a
specific price.
Options--In General. A Fund may purchase and write (i.e., sell) call or
put options with respect to specific securities. A call option gives the
purchaser of the option the right to buy, and obligates the writer to sell,
the underlying security or securities at the exercise price at any time
during the option period, or at a specific date. Conversely, a put option
gives the purchaser of the option the right to sell, and obligates the
writer to buy, the underlying security or securities at the exercise price
at any time during the option period, or at a specific date.
A covered call option written by a Fund is a call option with respect
to which a Fund owns the underlying security or otherwise covers the
transaction by segregating cash or other securities. A put option written
by a Fund is covered when, among other things, cash or liquid securities
having a value equal to or greater than the exercise price of the option
are placed in a segregated account with the Fund's custodian to fulfill the
obligation undertaken. The principal reason for writing covered call and
put options is to realize, through the receipt of premiums, a greater
return than would be realized on the underlying securities alone. A Fund
receives a premium from writing covered call or put options which it
retains whether or not the option is exercised.
There is no assurance that sufficient trading interest to create a
liquid secondary market on a securities exchange will exist for any
particular option or at any particular time, and for some options no such
secondary market may exist. A liquid secondary market in an option may
cease to exist for a variety of reasons. In the past, for example, higher
than anticipated trading activity or order flow, or other unforeseen
events, at times have rendered certain of the clearing facilities
inadequate and resulted in the institution of special procedures, such as
trading rotations, restrictions on certain types of orders or trading halts
or suspensions in one or more options. There can be no assurance that
similar events, or events that may otherwise interfere with the timely
execution of customers' orders, will not recur. In such event, it might
not be possible to effect closing transactions in particular options. If,
as a covered call option writer, the Fund is unable to effect a closing
purchase transaction in a secondary market, it will not be able to sell the
underlying security until the option expires or it delivers the underlying
security upon exercise or it otherwise covers its position.
Specific Options Transactions. A Fund may purchase and sell call and put
options in respect of specific securities (or groups or "baskets" of
specific securities) or stock indices listed on national securities
exchanges or traded in the over-the-counter market. An option on a stock
index is similar to an option in respect of specific securities, except
that settlement does not occur by delivery of the securities comprising the
index. Instead, the option holder receives an amount of cash if the
closing level of the stock index upon which the option is based is greater
than, in the case of a call, or less than, in the case of a put, the
exercise price of the option. Thus, the effectiveness of purchasing or
writing stock index options will depend upon price movements in the level
of the index rather than the price of a particular stock.
A Fund may purchase and sell call and put options on foreign currency.
These options convey the right to buy or sell the underlying currency at a
price which is expected to be lower or higher than the spot price of the
currency at the time the option is exercised or expires.
Dreyfus Emerging Markets Fund also may purchase cash-settled options
on equity index swaps in pursuit of its investment objective. Equity index
swaps involve the exchange by the Fund with another party of cash flows
based upon the performance of an index or a portion of an index of
securities which usually includes dividends. A cash-settled option on a
swap gives the purchaser the right, but not the obligation, in return for
the premium paid, to receive an amount of cash equal to the value of the
underlying swap as of the exercise date. These options typically are
purchased in privately negotiated transactions from financial institutions,
including securities brokerage firms.
Successful use by a Fund of options will be subject to the Manager's
ability to predict correctly movements in the prices of individual stocks,
the stock market generally, foreign currencies or interest rates. To the
extent such predictions are incorrect, a Fund may incur losses.
Future Developments. A Fund may take advantage of opportunities in
the area of options and futures contracts and options on futures contracts
and any other Derivatives which are not presently contemplated for use by
the Fund or which are not currently available but which may be developed,
to the extent such opportunities are both consistent with the Fund's
investment objective and legally permissible for the Fund. Before entering
into such transactions or making any such investment, the Fund will provide
appropriate disclosure in its Prospectus or Statement of Additional
Information.
Forward Commitments. A Fund may purchase securities on a forward
commitment or when-issued basis, which means that delivery and payment take
place a number of days after the date of the commitment to purchase. The
payment obligation and the interest rate receivable on a forward commitment
or when-issued security are fixed when the Fund enters into the commitment,
but the Fund does not make payment until it receives delivery from the
counterparty. A Fund will commit to purchase such securities only with the
intention of actually acquiring the securities, but the Fund may sell these
securities before the settlement date if it is deemed advisable. A
segregated account of the Fund consisting of permissible liquid assets at
least equal at all times to the amount of the commitments will be
established and maintained at the Fund's custodian bank.
Securities purchased on a forward commitment or when-issued basis are
subject to changes in value (generally changing in the same way, i.e.,
appreciating when interest rates decline and depreciating when interest
rates rise) based upon the public's perception of the creditworthiness of
the issuer and changes, real or anticipated, in the level of interest
rates. Securities purchased on a forward commitment or when-issued basis
may expose a Fund to risks because they may experience such fluctuations
prior to their actual delivery. Purchasing securities on a when-issued
basis can involve the additional risk that the yield available in the
market when the delivery takes place actually may be higher than that
obtained in the transaction itself. Purchasing securities on a forward
commitment or when-issued basis when a Fund is fully or almost fully
invested may result in greater potential fluctuation in the value of the
Fund's net assets and its net asset value per share.
Investment Restrictions
Each Fund has adopted investment restrictions numbered 1 through 8 as
fundamental policies, which cannot be changed, as to a Fund, without
approval by the holders of a majority (as defined in the 1940 Act) of the
Fund's outstanding voting shares. Investment restrictions numbered 9
through 14 are not fundamental policies and may be changed by vote of a
majority of the Company's Board members at any time. Neither Fund may:
1. Invest more than 25% of the value of its total assets in the
securities of issuers in any single industry, provided that there shall be
no limitation on the purchase of obligations issued or guaranteed by the
U.S. Government, its agencies or instrumentalities.
2. Invest in commodities, except that the Fund may purchase and sell
options, forward contracts, futures contracts, including those related to
indices, and options on futures contracts or indices.
3. Purchase, hold or deal in real estate, or oil, gas or other
mineral leases or exploration or development programs, but the Fund may
purchase and sell securities that are secured by real estate or issued by
companies that invest or deal in real estate or real estate investment
trusts.
4. Borrow money, except to the extent permitted under the 1940 Act
(which currently limits borrowing to no more than 33-1/3% of the value of
the Fund's total assets). For purposes of this Investment Restriction, the
entry into options, forward contracts, futures contracts, including those
relating to indices, and options on futures contracts or indices shall not
constitute borrowing.
5. Make loans to others, except through the purchase of debt
obligations and the entry into repurchase agreements. However, the Fund
may lend its portfolio securities in an amount not to exceed 33-1/3% of the
value of its total assets. Any loans of portfolio securities will be made
according to guidelines established by the Securities and Exchange
Commission and the Company's Board.
6. Act as an underwriter of securities of other issuers, except to
the extent the Fund may be deemed an underwriter under the Securities Act
of 1933, as amended, by virtue of disposing of portfolio securities.
7. Issue any senior security (as such term is defined in Section
18(f) of the 1940 Act), except to the extent the activities permitted in
Investment Restriction Nos. 2, 4, 11 and 12 may be deemed to give rise to a
senior security.
8. Purchase securities on margin, but the Fund may make margin
deposits in connection with transactions in options, forward contracts,
futures contracts, including those related to indices, and options on
futures contracts or indices.
9. Purchase securities of any company having less than three years'
continuous operations (including operations of any predecessor) if such
purchase would cause the value of the Fund's investments in all such
companies to exceed 5% of the value of its total assets.
10. Invest in the securities of a company for the purpose of
exercising management or control, but the Fund will vote the securities it
owns in its portfolio as a shareholder in accordance with its views.
11. Pledge, mortgage or hypothecate its assets, except to the extent
necessary to secure permitted borrowings and to the extent related to the
purchase of securities on a when-issued or forward commitment basis and the
deposit of assets in escrow in connection with writing covered put and call
options and collateral and initial or variation margin arrangements with
respect to options, forward contracts, futures contracts, including those
relating to indices, and options on futures contracts or indices.
12. Purchase, sell or write puts, calls or combinations thereof,
except as described in the relevant Fund's Prospectus and Statement of
Additional Information.
13. Enter into repurchase agreements providing for settlement in more
than seven days after notice or purchase securities which are illiquid, if,
in the aggregate, more than 15% of the value of the Fund's net assets would
be so invested.
14. Purchase securities of other investment companies, except to the
extent permitted under the 1940 Act.
If a percentage restriction is adhered to at the time of investment, a
later change in percentage resulting from a change in values or assets will
not constitute a violation of such restriction.
Each Fund may invest, notwithstanding any other investment restriction
(whether or not fundamental), all of its assets in the securities of a
single open-end management investment company with substantially the same
fundamental investment objective, policies and restrictions as the Fund.
The Company may make commitments more restrictive than the
restrictions listed above so as to permit the sale of Fund shares in
certain states. Should the Company determine that a commitment is no
longer in the best interest of the Fund and its shareholders, the Company
reserves the right to revoke the commitment by terminating the sale of such
Fund's shares in the state involved.
MANAGEMENT OF THE COMPANY
Board members and officers of the Company, together with information
as to their principal business occupations during at least the last five
years, are shown below. Each Board member who is deemed to be an
"interested person" of the Company, as defined in the 1940 Act, is
indicated by an asterisk.
Board Members of the Company
*JOSEPH S. DiMARTINO, Chairman of the Board. Since January 1995, Chairman
of the Board of various funds in the Dreyfus Family of Funds. He is
also Chairman of the Board of Directors of Noel Group, Inc., a venture
capital company; and a director of The Muscular Dystrophy Association,
HealthPlan Services Corporation, Belding Heminway Company, Inc., a
manufacturer and marketer of industrial threads, specialty yarns, home
furnishings and fabrics, Curtis Industries, Inc., a national
distributor of security products, chemicals and automotive and other
hardware, and Staffing Resources, Inc. For more than five years prior
to January 1995, he was President, a director and, until August 1994,
Chief Operating Officer of the Manager and Executive Vice President
and a director of Dreyfus Service Corporation, a wholly-owned
subsidiary of the Manager and, until August 24, 1994, the Company's
distributor. From August 1994 until December 31, 1994, he was a
director of Mellon Bank Corporation. He is 52 years old and his
address is c/o The Noel Group, 667 Madison Avenue, 25th Floor, New
York, New York 10021.
*DAVID P. FELDMAN, Board Member. Chairman and Chief Executive Officer of
AT&T Investment Management Corporation. He is also a trustee of
Corporate Property Investors, a real estate investment company. He is
56 years old and his address is One Oak Way, Berkeley Heights, New
Jersey 07922.
JOHN M. FRASER, JR., Board Member. President of Fraser Associates, a
service company for planning and arranging corporate meetings and
other events. From September 1975 to June 1978, he was Executive Vice
President of Flagship Cruises, Ltd. Prior thereto, he was Senior Vice
President and Resident Director of the Swedish-American Line for the
United States and Canada. He is 75 years old and his address is 133
East 64th Street, New York, New York 10021.
ROBERT R. GLAUBER, Board Member. Research Fellow, Center for Business and
Government at the John F. Kennedy School of Government, Harvard
University, since January 1992. He was Under Secretary of the
Treasury for Finance at the U.S. Treasury Department, from May 1989 to
January 1992. For more than five years prior thereto, he was a
Professor of Finance at the Graduate School of Business Administration
of Harvard University and, from 1985 to 1989, Chairman of its Advanced
Management Program. He is 57 years old and his address is 79 John F.
Kennedy Street, Cambridge, Massachusetts 02138.
JAMES F. HENRY, Board Member. President of the CPR Institute for Dispute
Resolution, a non-profit organization principally engaged in the
development of alternatives to business litigation. He was of counsel
to the law firm of Lovejoy, Wasson & Ashton from October 1975 to
December 1976 and from October 1979 to June 1983, and was a partner of
the firm from January 1977 to September 1979. He was President and a
director of the Edna McConnell Clark Foundation, a philanthropic
organization, from September 1971 to December 1976. Mr. Henry is 65
years old and his address is c/o CPR Institute for Dispute Resolution,
366 Madison Avenue, New York, New York 10017.
ROSALIND GERSTEN JACOBS, Board Member. Director of Merchandise and
Marketing for Corporate Property Investors, a real estate investment
company. From 1974 to 1976, she was owner and manager of a
merchandise and marketing consulting firm. Prior to 1974, she was a
Vice President of Macy's, New York. Mrs. Jacobs is 71 years old and
her address is c/o Corporate Property Investors, 305 East 47th Street,
New York, New York 10017.
IRVING KRISTOL, Board Member. John M. Olin Distinguished Fellow of the
American Enterprise Institute for Public Policy Research, co-editor of
The Public Interest magazine, and an author or co-editor of several
books. From May 1981 to December 1994, he was a consultant to the
Manager on economic matters; from 1969 to 1988, he was Professor of
Social Thought at the Graduate School of Business Administration, New
York University; and from September 1969 to August 1979, he was Henry
R. Luce Professor of Urban Values at New York University. Mr. Kristol
is 76 years old and his address is c/o The Public Interest, 1112 16th
Street, N.W., Suite 530, Washington, D.C. 20036.
DR. PAUL A. MARKS, Board Member. President and Chief Executive Officer of
Memorial Sloan-Kettering Cancer Center. He was Vice President for
Health Sciences and Director of the Cancer Center at Columbia
University from 1973 to 1980, and Professor of Medicine and of Human
Genetics and Development at Columbia University from 1968 to 1982. He
is also a director of Pfizer, Inc., a pharmaceutical company, Life
Technologies, Inc., a life science company producing products for cell
and molecular biology and microbiology, and Tularik, Inc., a
biotechnology company, and a general partner of LINC Venture Lease
Partners II, L.P., a limited partnership engaged in leasing. Dr.
Marks is 70 years old and his address is c/o Memorial Sloan-Kettering
Cancer Center, 1275 York Avenue, New York, New York 10021.
DR. MARTIN PERETZ, Board Member. Editor-in-Chief of The New Republic
magazine and a lecturer in Social Studies at Harvard University, where
he has been a member of the faculty since 1965. He is a trustee of
The Center for Blood Research at the Harvard Medical School and a
director of LeukoSite Inc., a biopharmaceutical company. Dr. Peretz
is 57 years old and his address is c/o The New Republic, 1220 19th
Street, N.W., Washington, D.C. 20036.
BERT W. WASSERMAN, Board Member. Financial Consultant. From January 1990
to March 1995, Executive Vice President and Chief Financial Officer,
and, from January 1990 to March 1993, a director of Time Warner Inc;
from 1981 to 1990, he was a member of the office of the President and
a director of Warner Communications, Inc. He is also a member of the
Chemical Bank National Advisory Board and a director of The New
Germany Fund, Mountasia Entertainment International, Inc. and the
Lillian Vernon Corporation. Mr. Wasserman is 63 years old and his
address is 126 East 56th Street, Suite 12 North, New York, New York
10022-3613.
For so long as the Company's plans described in the section captioned
"Distribution Plan and Shareholder Services Plan" remain in effect, the
Board members who are not "interested persons" of the Company, as defined
in the 1940 Act, will be selected and nominated by the Board members who
are not "interested persons" of the Company.
The Company typically pays its Board members an annual retainer and a
per meeting fee and reimburses them for their expenses. The Chairman of
the Board receives an additional 25% of such compensation. Emeritus Board
members are entitled to receive an annual retainer and a per meeting fee of
one-half the amount paid to them as Board members. The aggregate amount of
compensation paid to each Board member by the Company for the fiscal year
ended May 31, 1996, and by all other funds in the Dreyfus Family of Funds
for which such person is a Board member (the number of which is set forth
in parenthesis next to each Board member's total compensation) for the year
ended December 31, 1995, were as follows:
Total Compensation
From Company and
Aggregate Fund Complex
Name of Board Compensation Paid to Board
Member From Company* Member
Joseph S. DiMartino $6,250 $448,618 (94)
David P. Feldman $5,000 $113,783 (28)
John M. Fraser, Jr. $5,000 $ 58,606 (12)
Robert R. Glauber $5,000 $ 97,503 (21)
James F. Henry $5,000 $ 53,500 (10)
Rosalind Gersten
Jacobs $4,500 $ 92,500 (20)
Irving Kristol $5,000 $ 53,500 (10)
Dr. Paul A. Marks $4,500 $ 49,427 (10)
Dr. Martin Peretz $5,000 $ 53,500 (10)
Bert W. Wasserman $5,000 $ 54,739 (10)
* Amount does not include reimbursed expenses for attending Board
meetings, which amounted to $1,247 for all Board members as a group.
Officers of the Company
MARIE E. CONNOLLY, President and Treasurer. President, Chief Executive
Officer and a director of the Distributor and an officer of other
investment companies advised or administered by the Manager. From
December 1991 to July 1994, she was President and Chief Compliance
Officer of Funds Distributor, Inc., the ultimate parent of which is
Boston Institutional Group, Inc. Prior to December 1991, she served
as Vice President and Controller, and later as Senior Vice President,
of The Boston Company Advisors, Inc. She is 39 years old.
JOHN E. PELLETIER, Vice President and Secretary. Senior Vice President and
General Counsel of the Distributor and an officer of other investment
companies advised or administered by the Manager. From February 1992
to July 1994, he served as Counsel for The Boston Company Advisors,
Inc. From August 1990 to February 1992, he was employed as an
Associate at Ropes & Gray. He is 32 years old.
DOUGLAS C. CONROY, Vice President and Assistant Secretary. Supervisor of
Treasury Services and Administration of the Distributor and an officer
of other investment companies advised or administered by the Manager.
He is also Supervisor of Treasury Services and Administration of Funds
Distributor, Inc. From April 1993 to January 1995, he was a Senior
Fund Accountant for Investors Bank & Trust Company. From December
1991 to March 1993, he was employed as a Fund Accountant at The Boston
Company, Inc. He is 27 years old.
MARK A. KARPE, Vice President and Assistant Secretary. Senior Paralegal of
the Distributor and an officer of other investment companies advised
or administered by the Manager. Prior to August 1993, he was employed
as an Associate Examiner at the National Association of Securities
Dealers, Inc. He is 27 years old.
ELIZABETH KEELEY, Vice President and Assistant Secretary. Assistant Vice
President of the Distributor and an officer of other investment
companies advised or administered by the Manager. She is 27 years
old.
RICHARD INGRAM, Vice President and Assistant Treasurer. Senior Vice
President and Director of Client Services and Treasury Operations of
the Distributor and an officer of other investment companies advised
or administered by the Manager. He is also Senior Vice President and
Director of Client Services and Treasury Operations of Funds
Distributor, Inc. From March 1994 to November 1995, he was Vice
President and Division Manager for First Data Investor Services Group.
From 1989 to 1994, he was Vice President, Assistant Treasurer and Tax
Director - Mutual Funds of The Boston Company, Inc. He is 41 years
old.
MARY A. NELSON, Vice President and Assistant Treasurer. Vice President of
the Distributor and an officer of other investment companies advised
or administered by the Manager. She is also Vice President and
Manager of Treasury Services and Administration of Funds Distributor,
Inc. From September 1989 to July 1994, she was an Assistant Vice
President and Client Manager for The Boston Company, Inc. She is 32
years old.
JOSEPH F. TOWER, III, Vice President and Assistant Treasurer. Senior Vice
President, Treasurer and Chief Financial Officer of the Distributor
and an officer of other investment companies advised or administered
by the Manager. From July 1988 to August 1994, he was employed by The
Boston Company, Inc. where he held various management positions in the
Corporate Finance and Treasury areas. He is 34 years old.
The address of each officer of the Company is 200 Park Avenue, New
York, New York 10166.
The Company's Board members and officers, as a group, owned less than
1% of each Fund's voting securities outstanding on December 10, 1996.
The following are known by the Company to own, of record or
beneficially, 5% or more of the outstanding voting securities of Dreyfus
Emerging Markets Fund as of December 10, 1996: APT Holdings Corporation,
4500 New Linden Hill Road, Wilmington, Delaware--33.92%; MAC & Co. Mutual
Funds, P.O. Box 3198, Pittsburgh, Pennsylvania--11.28%. A shareholder who
beneficially owns, directly or indirectly, more than 25% of the Fund's
voting securities may be deemed a "control person" (as defined in the Act)
of the Fund.
MANAGEMENT AGREEMENT
The following information supplements and should be read in
conjunction with the section in each Fund's Prospectus entitled "Management
of the Company."
Management Agreement. The Manager provides management services
pursuant to the Management Agreement (the "Agreement") dated August 24,
1994, as amended March 11, 1996, with the Company. As to each Fund, the
Agreement is subject to annual approval by (i) the Company's Board or (ii)
vote of a majority (as defined in the 1940 Act) of the outstanding voting
securities of such Fund, provided that in either event the continuance also
is approved by a majority of the Board members who are not "interested
persons" (as defined in the 1940 Act) of the Company or the Manager, by
vote cast in person at a meeting called for the purpose of voting on such
approval. The Agreement was approved by shareholders on August 2, 1994 in
respect of Dreyfus International Growth Fund, and was last approved by the
Company's Board, including a majority of the Board members who are not
"interested persons" of any party to the Agreement, at a meeting held on
May 29, 1996. As to each Fund, the Agreement is terminable without
penalty, on 60 days' notice, by the Company's Board or by vote of the
holders of a majority of such Fund's shares, or, on not less than 90 days'
notice, by the Manager. The Agreement will terminate automatically, as to
the relevant Fund, in the event of its assignment (as defined in the 1940
Act).
The following persons are officers and/or directors of the Manager:
W. Keith Smith, Chairman of the Board; Christopher M. Condron, President,
Chief Executive Officer, Chief Operating Officer and a director; Stephen E.
Canter, Vice Chairman, Chief Investment Officer and a director; Lawrence S.
Kash, Vice Chairman--Distribution and a director; Philip L. Toia, Vice
Chairman--Operations and Administration and a director; William T.
Sandalls, Jr., Senior Vice President and Chief Financial Officer; William
F. Glavin, Jr., Vice President--Corporate Development; Mark N. Jacobs, Vice
President, General Counsel and Secretary; Patrice M. Kozlowski, Vice
President--Corporate Communications; Mary Beth Leibig, Vice President--
Human Resources; Jeffrey N. Nachman, Vice President--Mutual Fund
Accounting; Andrew S. Wasser, Vice President--Information Systems; Elvira
Oslapas, Assistant Secretary; and Mandell L. Berman, Frank V. Cahouet,
Alvin E. Friedman, Lawrence M. Greene and Julian M. Smerling, directors.
The Manager manages each Fund's investments in accordance with the
stated policies of such Fund, subject to the approval of the Company's
Board. The Manager is responsible for investment decisions, and provides
the Funds with portfolio managers who are authorized by the Board to
execute purchases and sales of securities. Dreyfus International Growth
Fund's portfolio manager is Ronald Chapman and Dreyfus Emerging Markets
Fund's portfolio managers are Sandor Cseh and D. Kirk Henry. The Manager
also maintains a research department with a professional staff of portfolio
managers and securities analysts who provide research services for the
Funds as well as for other funds advised by the Manager. All purchases and
sales are reported for the Board's review at the meeting subsequent to such
transactions.
The Manager maintains office facilities on behalf of the Funds, and
furnishes statistical and research data, clerical help, accounting, data
processing, bookkeeping and internal auditing and certain other required
services to the Funds. The Manager also may make such advertising and
promotional expenditures, using its own resources, as it from time to time
deems appropriate.
Expenses. All expenses incurred in the operation of the Company are
borne by the Company, except to the extent specifically assumed by the
Manager. The expenses borne by the Company include: organizational costs,
taxes, interest, loan commitment fees, interest and distributions paid on
securities sold short, brokerage fees and commissions, if any, fees of
Board members who are not officers, directors, employees or holders of 5%
or more of the outstanding voting securities of the Manager or any of its
affiliates, Securities and Exchange Commission fees, state Blue Sky
qualification fees, advisory fees, charges of custodians, transfer and
dividend disbursing agents' fees, certain insurance premiums, industry
association fees, outside auditing and legal expenses, costs of maintaining
the Company's existence, costs of independent pricing services, costs
attributable to investor services (including, without limitation, telephone
and personnel expenses), costs of preparing and printing prospectuses and
statements of additional information for regulatory purposes and for
distribution to existing shareholders, costs of shareholders' reports and
meetings, and any extraordinary expenses. See "Distribution Plan and
Shareholder Services Plan." Expenses attributable to a particular Fund are
charged against the assets of that Fund; other expenses of the Company are
allocated between the Funds on the basis determined by the Board,
including, but not limited to, proportionately in relation to the net
assets of each Fund.
As compensation for the Manager's services to the Company, the Company
has agreed to pay the Manager a monthly management fee at the annual rate
of .75 of 1% of the value of Dreyfus International Growth Fund's average
daily net assets, and 1.25% of the value of Dreyfus Emerging Markets Fund's
average daily net assets. All fees and expenses are accrued daily and
deducted before declaration of dividends to shareholders. For the period
from June 29, 1993 (commencement of operations) through May 31, 1994 and
for the fiscal years ended May 31, 1995 and 1996, the management fees
payable by Dreyfus International Growth Fund amounted to $731,828,
$1,181,098 and $859,453, respectively; however, pursuant to undertakings in
effect, the Manager reduced its fee by $174,169 in fiscal 1994, resulting
in a net fee paid by Dreyfus International Growth Fund of $557,659 for that
period. Dreyfus Emerging Markets Fund has not completed its first fiscal
year.
Pursuant to a sub-investment advisory agreement which was terminated
on March 31, 1996, the Manager engaged M&G Investment Management Limited
("M&G") to provide sub-investment advisory services to and day-to-day
management of Dreyfus International Growth Fund's investments. As
compensation for M&G's services, the Manager had agreed to pay M&G a
monthly fee at the annual rate of .30 of 1% of the value of Dreyfus
International Growth Fund's average daily net assets. For the period from
June 29, 1993 (commencement of operations) through May 31, 1994, for the
fiscal year ended May 31, 1995 and for the period from June 1, 1995 through
March 31, 1996, the sub-investment advisory fees payable by the Manager to
M&G amounted to $316,827, $475,057 and $290,879, respectively; however,
pursuant to undertakings in effect, the sub-investment advisory fee was
reduced by $51,342 in fiscal 1994, resulting in a net fee paid by the
Manager to M&G of $265,485 for that period.
As to each Fund, the Manager has agreed that if in any fiscal year the
aggregate expenses of the Fund, exclusive of taxes, brokerage, interest on
borrowings and (with the prior written consent of the necessary state
securities commissions) extraordinary expenses, but including the
management fee, exceed the expense limitation of any state having
jurisdiction over the Fund, the Fund may deduct from the payment to be made
to the Manager under the Agreement, or the Manager will bear, such excess
expense. Such deduction or payment, if any, will be estimated daily, and
reconciled and effected or paid, as the case may be, on a monthly basis.
The aggregate of the fees payable to the Manager is not subject to
reduction as the value of a Fund's net assets increases.
PURCHASE OF SHARES
The following information supplements and should be read in
conjunction with the section in each Fund's Prospectus entitled "How to Buy
Shares."
The Distributor. The Distributor serves as each Fund's distributor on
a best efforts basis pursuant to an agreement which is renewable annually.
The Distributor also acts as distributor for the other funds in the Dreyfus
Family of Funds and for certain other investment companies. In some
states, certain financial institutions effecting transactions in Fund
shares may be required to register as dealers pursuant to state law.
Dreyfus TeleTransfer Privilege. Dreyfus TeleTransfer purchase orders
may be made at any time. Purchase orders received by 4:00 p.m., New York
time, on any business day that Dreyfus Transfer, Inc., the Funds' transfer
and dividend disbursing agent (the "Transfer Agent"), and the New York
Stock Exchange are open for business will be credited to the shareholder's
Fund account on the next bank business day following such purchase order.
Purchase orders made after 4:00 p.m., New York time, on any business day
the Transfer Agent and the New York Stock Exchange are open for business,
or orders made on Saturday, Sunday or any Fund holiday (e.g., when the New
York Stock Exchange is not open for business), will be credited to the
shareholder's Fund account on the second bank business day following such
purchase order. To qualify to use the Dreyfus TeleTransfer Privilege, the
initial payment for purchase of shares must be drawn on, and redemption
proceeds paid to, the same bank and account as are designated on the
Account Application or Shareholder Services Form on file. If the proceeds
of a particular redemption are to be wired to an account at any other bank,
the request must be in writing and signature-guaranteed. See "Redemption
of Shares--Dreyfus TeleTransfer Privilege."
Reopening an Account. An investor may reopen an account with a
minimum investment of $100 without filing a new Account Application during
the calendar year the account is closed or during the following calendar
year, provided the information on the old Account Application is still
applicable.
DISTRIBUTION PLAN AND SHAREHOLDER SERVICES PLAN
The following information supplements and should be read in
conjunction with the section in Dreyfus International Growth Fund's
Prospectus entitled "Distribution Plan and Shareholder Services Plan" or in
Dreyfus Emerging Market Fund's Prospectus entitled "Shareholder Services
Plan."
Distribution Plan. (Dreyfus International Growth Fund only) Rule
12b-1 (the "Rule") adopted by the Securities and Exchange Commission under
the 1940 Act provides, among other things, that an investment company may
bear expenses of distributing its shares only pursuant to a plan adopted in
accordance with the Rule. The Company's Board has adopted such a plan with
respect to Dreyfus International Growth Fund (the "Distribution Plan")
pursuant to which the Company reimburses the Distributor for distributing
Dreyfus International Growth Fund's shares and pays the Manager, Dreyfus
Service Corporation and any affiliate of either of them for advertising and
marketing relating to Dreyfus International Growth Fund. Under the
Distribution Plan, the Distributor may make payments to certain financial
institutions, securities dealers and other financial industry professionals
(collectively, "Service Agents") in respect to these services. The
Company's Board believes that there is a reasonable likelihood that the
Distribution Plan will benefit Dreyfus International Growth Fund and its
shareholders.
A quarterly report of the amounts expended under the Distribution
Plan, and the purposes for which such expenditures were incurred, must be
made to the Board for its review. In addition, the Distribution Plan
provides that it may not be amended to increase materially the cost which
shareholders may bear pursuant to the Distribution Plan without shareholder
approval and that other material amendments of the Distribution Plan must
be approved by the Company's Board and by the Board members who are not
"interested persons" (as defined in the 1940 Act) of the Company and have
no direct or indirect financial interest in the operation of the
Distribution Plan or in any agreements entered into in connection with the
Distribution Plan, by vote cast in person at a meeting called for the
purpose of considering such amendments. The Distribution Plan is subject
to annual approval by such vote of the Board members cast in person at a
meeting called for the purpose of voting on the Distribution Plan. The
Distribution Plan was last so approved on May 29, 1996. The Distribution
Plan may be terminated at any time by vote of a majority of the Board
members who are not "interested persons" and have no direct or indirect
financial interest in the operation of the Distribution Plan or in any
agreements entered into in connection with the Distribution Plan or by vote
of the holders of a majority of Dreyfus International Growth Fund's shares.
For the fiscal year ended May 31, 1996, the amount payable by Dreyfus
International Growth Fund under the Distribution Plan was $589,143, of
which $563,975 was payable to the Manager for advertising and marketing
Dreyfus International Growth Fund's shares, $8,994 was reimbursed to the
Distributor for payments made to Service Agents and $16,174 was payable by
the Fund for preparing, printing and distributing prospectuses and
statements of additional information and for costs associated with
implementing and operating the Plan.
Shareholder Services Plan. The Company has adopted a Shareholder
Services Plan, pursuant to which the Company pays the Distributor for the
provision of certain services to each Fund's shareholders. The services
provided may include personal services relating to shareholder accounts,
such as answering shareholder inquiries regarding the Company and providing
reports and other information, and services related to the maintenance of
such shareholder accounts. Under the Shareholder Services Plan, the
Distributor may make payments to Service Agents in respect of these
services.
A quarterly report of the amounts expended under the Shareholder
Services Plan, and the purposes for which such expenditures were incurred,
must be made to the Board for its review. In addition, the Shareholder
Services Plan provides that material amendments must be approved by the
Company's Board and by the Board members who are not "interested persons"
(as defined in the 1940 Act) of the Company and have no direct or indirect
financial interest in the operation of the Shareholder Services Plan or in
any agreements entered into in connection with the Shareholder Services
Plan, by vote cast in person at a meeting called for the purpose of
considering such amendments. As to each Fund, the Shareholder Services
Plan is subject to annual approval by such vote of the Board members cast
in person at a meeting called for the purpose of voting on the Shareholder
Services Plan. The Shareholder Services Plan was last so approved on May
29, 1996. The Shareholder Services Plan is terminable with respect to each
Fund at any time by vote of a majority of the Board members who are not
"interested persons" and have no direct or indirect financial interest in
the operation of the Shareholder Services Plan or in any agreements entered
into in connection with the Shareholder Services Plan.
For the fiscal year ended May 31, 1996, Dreyfus International Growth
Fund was charged $286,484 pursuant to the Shareholder Services Plan.
Dreyfus Emerging Markets Fund has not completed its first fiscal year.
REDEMPTION OF SHARES
The following information supplements and should be read in
conjunction with the section in each Fund's Prospectus entitled "How to
Redeem Shares."
Redemption Fee. (Dreyfus Emerging Markets Fund only) Dreyfus Emerging
Markets Fund will deduct a redemption fee equal to 1% of the net asset
value of Fund shares redeemed (including redemptions through the use of the
Fund Exchanges service) following the issuance of such shares. The
redemption fee will be deducted from redemption proceeds and retained by
the Fund.
No redemption fee will be charged upon the redemption of shares (1)
through the Fund's Automatic Withdrawal Plan or Dreyfus Auto-Exchange
Privilege, (2) through accounts that are reflected on the records of the
Transfer Agent as omnibus accounts approved by Dreyfus Service Corporation,
(3) through accounts established by securities dealers, banks or other
financial institutions approved by Dreyfus Service Corporation that utilize
the National Securities Clearing Corporation's networking system, or (4)
acquired through the reinvestment of dividends or capital gains
distributions. The redemption fee may be waived, modified or terminated at
any time.
Wire Redemption Privilege. By using this Privilege, the investor
authorizes the Transfer Agent to act on wire or telephone redemption
instructions from any person representing himself or herself to be the
investor, or a representative of the investor's Service Agent, and
reasonably believed by the Transfer Agent to be genuine. Ordinarily, the
Company will initiate payment for shares redeemed pursuant to this
Privilege on the next business day after receipt by the Transfer Agent of
the redemption request in proper form. Redemption proceeds ($1,000
minimum) will be transferred by Federal Reserve wire only to the commercial
bank account specified by the investor on the Account Application or
Shareholder Services Form, or to a correspondent bank if the investor's
bank is not a member of the Federal Reserve System. Fees ordinarily are
imposed by such bank and usually are borne by the investor. Immediate
notification by the correspondent bank to the investor's bank is necessary
to avoid a delay in crediting the funds to the investor's bank account.
Investors with access to telegraphic equipment may wire redemption
requests to the Transfer Agent by employing the following transmittal code
which may be used for domestic or overseas transmissions:
Transfer Agent's
Transmittal Code Answer Back Sign
144295 144295 TSSG PREP
Investors who do not have direct access to telegraphic equipment may
have the wire transmitted by contacting a TRT Cables operator at
1-800-654-7171, toll free. Investors should advise the operator that the
above transmittal code must be used and should also inform the operator of
the Transfer Agent's answer back sign.
To change the commercial bank or account designated to receive
redemption proceeds, a written request must be sent to the Transfer Agent.
This request must be signed by each shareholder, with each signature
guaranteed as described below under "Stock Certificates; Signatures."
Dreyfus TeleTransfer Privilege. Investors should be aware that if
they have selected the Dreyfus TeleTransfer Privilege, any request for a
wire redemption will be effected as a Dreyfus TeleTransfer transaction
through the Automated Clearing House ("ACH") system unless more prompt
transmittal specifically is requested. Redemption proceeds will be on
deposit in the investor's account at an ACH member bank ordinarily two
business days after receipt of the redemption request. See "Purchase of
Shares--Dreyfus TeleTransfer Privilege."
Stock Certificates; Signatures. Any certificates representing Fund
shares to be redeemed must be submitted with the redemption request.
Written redemption requests must be signed by each shareholder, including
each holder of a joint account, and each signature must be guaranteed.
Signatures on endorsed certificates submitted for redemption also must be
guaranteed. The Transfer Agent has adopted standards and procedures
pursuant to which signature-guarantees in proper form generally will be
accepted from domestic banks, brokers, dealers, credit unions, national
securities exchanges, registered securities associations, clearing agencies
and savings associations, as well as from participants in the New York
Stock Exchange Medallion Signature Program, the Securities Transfer Agents
Medallion Program ("STAMP") and the Stock Exchanges Medallion Program.
Guarantees must be signed by an authorized signatory of the guarantor and
"Signature-Guaranteed" must appear with the signature. The Transfer Agent
may request additional documentation from corporations, executors,
administrators, trustees or guardians, and may accept other suitable
verification arrangements from foreign investors, such as consular
verification. For more information with respect to signature-guarantees,
please call one of the telephone numbers listed on the cover.
Redemption Commitment. The Company has committed itself to pay in
cash all redemption requests by any shareholder of record of a Fund,
limited in amount during any 90-day period to the lesser of $250,000 or 1%
of the value of such Fund's net assets at the beginning of such period.
Such commitment is irrevocable without the prior approval of the Securities
and Exchange Commission. In the case of requests for redemption in excess
of such amount, the Board reserves the right to make payments in whole or
in part in securities (which may include non-marketable securities) or
other assets in case of an emergency or any time a cash distribution would
impair the liquidity of the Fund to the detriment of the existing
shareholders. In such event, the securities would be valued in the same
manner as the Fund's securities are valued. If the recipient sold such
securities, brokerage charges would be incurred.
Suspension of Redemptions. The right of redemption may be suspended
or the date of payment postponed (a) during any period when the New York
Stock Exchange is closed (other than customary weekend and holiday
closings), (b) when trading in the markets the relevant Fund ordinarily
utilizes is restricted, or when an emergency exists as determined by the
Securities and Exchange Commission so that disposal of the Fund's
investments or determination of its net asset value is not reasonably
practicable, or (c) for such other periods as the Securities and Exchange
Commission by order may permit to protect the Fund's shareholders.
SHAREHOLDER SERVICES
The following information supplements and should be read in
conjunction with the section in each Fund's Prospectus entitled
"Shareholder Services."
Fund Exchanges. Shares of funds purchased by exchange will be
purchased on the basis of relative net asset value per share as follows:
A. Exchanges for shares of funds that are offered without a sales
load will be made without a sales load.
B. Shares of funds purchased without a sales load may be exchanged
for shares of other funds sold with a sales load, and the
applicable sales load will be deducted.
C. Shares of funds purchased with a sales load may be exchanged
without a sales load for shares of other funds sold without a
sales load.
D. Shares of funds purchased with a sales load, shares of funds
acquired by a previous exchange from shares purchased with a
sales load and additional shares acquired through reinvestment of
dividends or distributions of any such funds (collectively
referred to herein as "Purchased Shares") may be exchanged for
shares of other funds sold with a sales load (referred to herein
as "Offered Shares"), provided that, if the sales load applicable
to the Offered Shares exceeds the maximum sales load that could
have been imposed in connection with the Purchased Shares (at the
time the Purchased Shares were acquired), without giving effect
to any reduced loads, the difference will be deducted.
To accomplish an exchange under item D above, shareholders must notify
the Transfer Agent of their prior ownership of fund shares and their
account number.
To request an exchange, an investor or the investor's Service Agent
acting on the investor's behalf must give exchange instructions to the
Transfer Agent in writing or by telephone. The ability to issue exchange
instructions by telephone is given to all Fund shareholders automatically,
unless the investor checks the applicable "No" box on the Account
Application, indicating that the investor specifically refuses this
Privilege. By using the Telephone Exchange Privilege, the investor
authorizes the Transfer Agent to act on telephonic instructions (including
over The Dreyfus TouchRegistration Mark automated telephone system) from any
person representing himself or herself to be the investor or a representative of
the investor's Service Agent, and reasonably believed by the Transfer Agent
to be genuine. Telephone exchanges may be subject to limitations as to the
amount involved or the number of telephone exchanges permitted. Shares
issued in certificate form are not eligible for telephone exchange.
To establish a personal retirement plan by exchange, shares of the
fund being exchanged must have a value of at least the minimum initial
investment required for the fund into which the exchange is being made.
For Dreyfus-sponsored Keogh Plans, IRAs and IRAs set up under a Simplified
Employee Pension Plan ("SEP-IRAs") with only one participant, the minimum
initial investment is $750. To exchange shares held in corporate plans,
403(b)(7) Plans and SEP-IRAs with more than one participant, the minimum
initial investment is $100 if the plan has at least $2,500 invested among
the funds in the Dreyfus Family of Funds. To exchange shares held in a
personal retirement plan account, the shares exchanged must have a current
value of at least $100.
Dreyfus Auto-Exchange Privilege. Dreyfus Auto-Exchange Privilege
permits an investor to purchase, in exchange for shares of a Fund, shares
of another fund in the Dreyfus Family of Funds. This Privilege is
available only for existing accounts. Shares will be exchanged on the
basis of relative net asset value as described above under "Fund
Exchanges." Enrollment in or modification or cancellation of this
Privilege is effective three business days following notification by the
investor. An investor will be notified if the investor's account falls
below the amount designated to be exchanged under this Privilege. In this
case, an investor's account will fall to zero unless additional investments
are made in excess of the designated amount prior to the next Auto-Exchange
transaction. Shares held under IRA and other retirement plans are eligible
for this Privilege. Exchanges of IRA shares may be made between IRA
accounts and from regular accounts to IRA accounts, but not from IRA
accounts to regular accounts. With respect to all other retirement
accounts, exchanges may be made only among those accounts.
Fund Exchanges and the Dreyfus Auto-Exchange Privilege are available
to shareholders resident in any state in which shares of the fund being
acquired may legally be sold. Shares may be exchanged only between
accounts having identical names and other identifying designations.
Shareholder Services Forms and prospectuses of the other funds may be
obtained by calling 1-800-645-6561. The Company reserves the right to
reject any exchange request in whole or in part. The Fund Exchanges
service or the Dreyfus Auto-Exchange Privilege may be modified or
terminated at any time upon notice to shareholders.
Automatic Withdrawal Plan. The Automatic Withdrawal Plan permits an
investor with a $5,000 minimum account to request withdrawal of a specified
dollar amount (minimum of $50) on either a monthly or quarterly basis.
Withdrawal payments are the proceeds from sales of Fund shares, not the
yield on the shares. If withdrawal payments exceed reinvested dividends
and distributions, the investor's shares will be reduced and eventually may
be depleted. Automatic Withdrawal may be terminated at any time by the
investor, the Company or the Transfer Agent. Shares for which certificates
have been issued may not be redeemed through the Automatic Withdrawal Plan.
Dreyfus Dividend Sweep. Dreyfus Dividend Sweep allows investors to
invest automatically their dividends or dividends and capital gain
distributions, if any, from a Fund in shares of another fund in the Dreyfus
Family of Funds of which the investor is a shareholder. Shares of other
funds purchased pursuant to this privilege will be purchased on the basis
of relative net asset value per share as follows:
A. Dividends and distributions paid by a fund may be invested
without imposition of a sales load in shares of other funds that
are offered without a sales load.
B. Dividends and distributions paid by a fund which does not charge
a sales load may be invested in shares of other funds sold with a
sales load, and the applicable sales load will be deducted.
C. Dividends and distributions paid by a fund which charges a sales
load may be invested in shares of other funds sold with a sales
load (referred to herein as "Offered Shares"), provided that, if
the sales load applicable to the Offered Shares exceeds the
maximum sales load charged by the fund from which dividends or
distributions are being swept, without giving effect to any
reduced loads, the difference will be deducted.
D. Dividends and distributions paid by a fund may be invested in
shares of other funds that impose a contingent deferred sales
charge ("CDSC") and the applicable CDSC, if any, will be imposed
upon redemption of such shares.
Corporate Pension/Profit-Sharing and Retirement Plans. The Company
makes available to corporations a variety of prototype pension and profit-
sharing plans including a 401(k) Salary Reduction Plan. In addition, the
Company makes available Keogh Plans, IRAs, including SEP-IRAs and IRA
"Rollover Accounts," and 403(b)(7) Plans. Plan support services also are
available.
Investors who wish to purchase Fund shares in conjunction with a Keogh
Plan, a 403(b)(7) Plan or an IRA, including a SEP-IRA, may request from the
Distributor forms for adoption of such plans.
The entity acting as custodian for Keogh Plans, 403(b)(7) Plans or
IRAs may charge a fee, payment of which could require the liquidation of
shares. All fees charged are described in the appropriate form.
Shares may be purchased in connection with these plans only by direct
remittance to the entity acting as custodian. Purchases for these plans
may not be made in advance of receipt of funds.
The minimum initial investment for corporate plans, Salary Reduction
Plans, 403(b)(7) Plans and SEP-IRAs with more than one participant, is
$2,500 with no minimum for subsequent purchases. The minimum initial
investment for Dreyfus-sponsored Keogh Plans, IRAs, SEP-IRAs and 403(b)(7)
Plans with only one participant, is ordinarily $750, with no minimum for
subsequent purchases. Individuals who open an IRA also may open a
non-working spousal IRA with a minimum investment of $250.
Each investor should read the prototype retirement plan and the
appropriate form of custodial agreement for further details on eligibility,
service fees and tax implications, and should consult a tax adviser.
DETERMINATION OF NET ASSET VALUE
The following information supplements and should be read in
conjunction with the section in each Fund's Prospectus entitled "How to Buy
Shares."
Valuation of Portfolio Securities. Each Fund's securities, including
covered call options written by a Fund, are valued at the last sale price
on the securities exchange or national securities market on which such
securities primarily are traded. Securities not listed on an exchange or
national securities market, or securities in which there were no
transactions, are valued at the average of the most recent bid and asked
prices, except in the case of open short positions where the asked price is
used for valuation purposes. Bid price is used when no asked price is
available. Any assets or liabilities initially expressed in terms of
foreign currency will be translated into U.S. dollars at the midpoint of
the New York interbank market spot exchange rate as quoted on the day of
such translation or, if no such rate is quoted on such date, such other
quoted market exchange rate as may be determined to be appropriate by the
Manager. Forward currency contracts will be valued at the current cost of
offsetting the contract. If a Fund has to obtain prices as of the close of
trading on various exchanges throughout the world, the calculation of net
asset value may not take place contemporaneously with the determination of
prices of certain of the Funds' securities. Short-term investments are
carried at amortized cost, which approximates value. Expenses and fees,
including the management fee and fees pursuant to the Distribution Plan and
Shareholder Services Plan, are accrued daily and taken into account for the
purpose of determining the net asset value of a Fund's shares.
Restricted securities, as well as securities or other assets for which
recent market quotations are not readily available, or are not valued by a
pricing service approved by the Board, are valued at fair value as
determined in good faith by the Board. The Board will review the method of
valuation on a current basis. In making their good faith valuation of
restricted securities, the Board members generally will take the following
factors into consideration: restricted securities which are, or are
convertible into, securities of the same class of securities for which a
public market exists usually will be valued at market value less the same
percentage discount at which purchased. This discount will be revised
periodically by the Board if the Board members believe that it no longer
reflects the value of the restricted securities. Restricted securities not
of the same class as securities for which a public market exists usually
will be valued initially at cost. Any subsequent adjustment from cost will
be based upon considerations deemed relevant by the Board.
New York Stock Exchange Closings. The holidays (as observed) on which
the New York Stock Exchange is closed currently are: New Year's Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving and Christmas.
DIVIDENDS, DISTRIBUTIONS AND TAXES
The following information supplements and should be read in
conjunction with the section in each Fund's Prospectus entitled "Dividends,
Distributions and Taxes."
Management of the Company believes that Dreyfus International Growth
Fund has qualified for the fiscal year ended May 31, 1996 as a "regulated
investment company" under the Internal Revenue Code of 1986, as amended
(the "Code"). It is expected that Dreyfus Emerging Markets Fund will
qualify as a regulated investment company under the Code. Each Fund
intends to continue to so qualify if such qualification is in the best
interests of its shareholders. As a regulated investment company, each
Fund will pay no Federal income tax on net investment income and net
realized securities gains to the extent that such income and gains are
distributed to shareholders in accordance with applicable provisions of the
Code. To qualify as a regulated investment company, the Fund must
distribute at least 90% of its net income (consisting of net investment
income and net short-term capital gain) to its shareholders, derive less
than 30% of its annual gross income from gain on the sale of securities
held for less than three months, and meet certain asset diversification and
other requirements. The term "regulated investment company" does not imply
the supervision of management or investment practices or policies by any
government agency.
Any dividend or distribution paid shortly after an investor's purchase
may have the effect of reducing the net asset value of the shares below the
cost of the investment. Such a dividend or distribution would be a return
of investment in an economic sense, although taxable as stated in the
Fund's Prospectus. In addition, the Code provides that if a shareholder
holds shares of a Fund for six months or less and has received a capital
gain distribution with respect to such shares, any loss incurred on the
sale of such shares will be treated as long-term capital loss to the extent
of the capital gain distribution received.
Depending upon the composition of a Fund's income, the entire amount
or a portion of the dividends paid by such Fund from net investment income
may qualify for the dividends received deduction allowable to qualifying
U.S. corporate shareholders ("dividends received deduction"). In general,
dividend income of a Fund distributed to qualifying corporate shareholders
will be eligible for the dividends received deduction only to the extent
that such Fund's income consists of dividends paid by U.S. corporations.
However, Section 246(c) of the Code provides that if a qualifying corporate
shareholder has disposed of Fund shares not held for 46 days or more and
has received a dividend from net investment income with respect to such
shares, the portion designated by the Fund as qualifying for the dividends
received deduction will not be eligible for such shareholder's dividends
received deduction. In addition, the Code provides other limitations with
respect to the ability of a qualifying corporate shareholder to claim the
dividends received deduction in connection with holding Fund shares.
A Fund may qualify for and may make an election permitted under
Section 853 of the Code so that shareholders may be eligible to claim a
credit or deduction on their Federal income tax returns for, and will be
required to treat as part of the amounts distributed to them, their pro
rata portion of qualified taxes paid or incurred by the Fund to foreign
countries (which taxes relate primarily to investment income). A Fund may
make an election under Section 853, provided that more than 50% of the
value of the Fund's total assets at the close of the taxable year consists
of securities in foreign corporations, and the Fund satisfies the
applicable distribution provisions of the Code. The foreign tax credit
available to shareholders is subject to certain limitations imposed by the
Code.
Ordinarily, gains and losses realized from portfolio transactions will
be treated as capital gains and losses. However, a portion of the gain or
loss realized from the disposition of foreign currencies (including foreign
currency denominated bank deposits) and non-U.S. dollar denominated
securities (including debt instruments and certain forward contracts and
options) may be treated as ordinary income or loss under Section 988 of the
Code. In addition, all or a portion of any gains realized from the sale or
other disposition of certain market discount bonds will be treated as
ordinary income under Section 1276 of the Code. Finally, all or a portion
of the gain realized from engaging in "conversion transactions" may be
treated as ordinary income under Section 1258 of the Code. "Conversion
transactions" are defined to include certain forward, futures, option and
straddle transactions, transactions marketed or sold to produce capital
gains, or transactions described in Treasury regulations to be issued in
the future.
Under Section 1256 of the Code, any gain or loss realized by a Fund
from certain forward contracts and options transactions will be treated as
60% long-term capital gain or loss and 40% short-term capital gain or loss.
Gain or loss will arise upon exercise or lapse of such contracts and
options as well as from closing transactions. In addition, any such
contracts or options remaining unexercised at the end of a Fund's taxable
year will be treated as sold for their then fair market value, resulting in
additional gain or loss to such Fund characterized in the manner described
above.
Offsetting positions held by a Fund involving certain foreign currency
forward contracts or options may constitute "straddles." "Straddles" are
defined to include "offsetting positions" in actively traded personal
property. The tax treatment of "straddles" is governed by Sections 1092
and 1258 of the Code, which, in certain circumstances, overrides or
modifies the provisions of Sections 1256 and 988 of the Code. As such, all
or a portion of any short or long-term capital gain from certain "straddle"
transactions may be recharacterized to ordinary income.
If a Fund were treated as entering into "straddles" by reason of its
engaging in certain forward contracts or options transactions, such
"straddles" would be characterized as "mixed straddles" if the forward
contracts or options transactions comprising a part of such "straddles"
were governed by Section 1256 of the Code. A Fund may make one or more
elections with respect to "mixed straddles." Depending on which election
is made, if any, the results to a Fund may differ. If no election is made,
to the extent the "straddle" and conversion transaction rules apply to
positions established by a Fund, losses realized by a Fund will be deferred
to the extent of unrealized gain in the offsetting position. Moreover, as
a result of the "straddle" and conversion transaction rules, short-term
capital loss on "straddle" positions may be recharacterized as long-term
capital loss, and long-term capital gains may be treated as short-term
capital gains or ordinary income.
If a Fund invests in an entity that is classified as a "passive
foreign investment company" ("PFIC") for Federal income tax purposes, the
operation of certain provisions of the Code applying to PFICs could result
in the imposition of certain Federal income taxes on the Fund. In
addition, gain realized from the sale or other disposition of PFIC
securities may be treated as ordinary income under Section 1291 of the
Code.
Investment by a Fund in securities issued or acquired at a discount,
or providing for deferred interest or for payment of interest in the form
of additional obligations could under special tax rules affect the amount,
timing and character of distributions to shareholders by causing a Fund to
recognize income prior to the receipt of cash payments. For example, a
Fund could be required to accrue a portion of the discount (or deemed
discount) at which the securities were issued each year and to distribute
such income in order to maintain its qualification as a regulated
investment company. In such case, a Fund may have to dispose of securities
which it might otherwise have continued to hold in order to generate cash
to satisfy these distribution requirements.
PORTFOLIO TRANSACTIONS
The Manager assumes general supervision over placing orders on behalf
of the Company for the purchase or sale of portfolio securities.
Allocation of brokerage transactions, including their frequency, is made in
the best judgment of the Manager and in a manner deemed fair and reasonable
to shareholders. The primary consideration is prompt execution of orders
at the most favorable net price. Subject to this consideration, the
brokers selected will include those that supplement the Manager's research
facilities with statistical data, investment information, economic facts
and opinions. Information so received is in addition to and not in lieu of
services required to be performed by the Manager and the Manager's fees are
not reduced as a consequence of the receipt of such supplemental
information. Such information may be useful to the Manager in serving both
the Company and other funds which it advises and, conversely, supplemental
information obtained by the placement of business of other clients may be
useful to the Manager in carrying out its obligations to the Company.
Sales of Fund shares by a broker may be taken into consideration, and
brokers also will be selected because of their ability to handle special
executions such as are involved in large block trades or broad
distributions, provided the primary consideration is met. Large block
trades may, in certain cases, result from two or more funds advised or
administered by the Manager being engaged simultaneously in the purchase or
sale of the same security. Certain of a Fund's transactions in securities
of foreign issuers may not benefit from the negotiated commission rates
available to a Fund for transactions in securities of domestic issuers.
When transactions are executed in the over-the-counter market, each Fund
will deal with the primary market makers unless a more favorable price or
execution otherwise is obtainable. Foreign exchange transactions are made
with banks or institutions in the interbank market at prices reflecting a
mark-up or mark-down and/or commission.
Portfolio turnover may vary from year to year as well as within a
year. It is anticipated that in any fiscal year the turnover rate of a
Fund may approach the 150% level. In periods in which extraordinary market
conditions prevail, the Manager will not be deterred from changing a Fund's
investment strategy as rapidly as needed, in which case higher turnover
rates can be anticipated which would result in greater brokerage expenses.
The overall reasonableness of brokerage commissions paid is evaluated by
the Manager based upon its knowledge of available information as to the
general level of commissions paid by other institutional investors for
comparable services.
For the period June 29, 1993 (commencement of operations) through May
31, 1994 and for the fiscal years ended May 31, 1995 and 1996, Dreyfus
International Growth Fund paid total brokerage commissions of $894,844,
$573,515 and $798,435, respectively, none of which was paid to the
Distributor. There were no gross spreads and concessions on principal
transactions during such periods. Dreyfus Emerging Markets Fund has not
completed its first fiscal year.
PERFORMANCE INFORMATION
The following information supplements and should be read in
conjunction with the section in each Fund's Prospectus entitled
"Performance Information."
Dreyfus International Growth Fund's average annual return for the 1
and 3.425 year periods ended November 30, 1996 was 13.02% and 7.70%,
respectively. Average annual total return is calculated by determining the
ending redeemable value of an investment purchased with a hypothetical
$1,000 payment made at the beginning of the period (assuming the
reinvestment of dividends and distributions), dividing by the amount of the
initial investment, taking the "n"th root of the quotient (where "n" is the
number of years in the period) and subtracting 1 from the result.
Dreyfus International Growth Fund's total return for the period June
29, 1993 (commencement of operations) through November 30, 1996 was 28.94%.
Dreyfus Emerging Markets Fund's total return for the period June 28, 1996
(commencement of operations) through November 30, 1996 was -2.16%. Total
return for a Fund is calculated by subtracting the amount of the Fund's net
asset value per share at the beginning of a stated period from the net
asset value per share at the end of the period (after giving effect to the
reinvestment of dividends and distributions during the period), and
dividing the result by the net asset value per share at the beginning of
the period.
Comparative performance may be used from time to time in advertising a
Fund's shares, including data from Lipper Analytical Services, Inc., Morgan
Stanley Capital International Emerging Markets Index, Standard & Poor's 500
Composite Stock Price Index, the Dow Jones Industrial Average, Money
Magazine, Morningstar, Inc. and other industry publications. From time to
time, a Fund may compare its performance against inflation with the
performance of other instruments against inflation, such as short-term
Treasury Bills (which are direct obligations of the U.S. Government) and
FDIC-insured bank money market accounts. In addition, advertising for a
Fund may indicate that investors may consider diversifying their investment
portfolios in order to seek protection of the value of their assets against
inflation. From time to time, advertising materials for a Fund may include
biographical information relating to its portfolio managers, and may refer
to or include commentary by a portfolio manager relating to investment
strategy, asset growth, current or past business, political, economic or
financial conditions and other matters of general interest to investors. A
Fund's advertising materials also may refer to the integration of the
world's securities markets, discuss the investment opportunities available
worldwide and mention the increasing importance of an investment strategy
including foreign investments. Advertising materials for each Fund also
may include information concerning retirement and investing for retirement,
may refer to the approximate number of then-current Fund shareholders and
may refer to Lipper or Morningstar ratings and related analysis supporting
the ratings.
INFORMATION ABOUT THE FUNDS
The following information supplements and should be read in
conjunction with the section in each Fund's Prospectus entitled "General
Information."
Each Fund share has one vote and, when issued and paid for in
accordance with the terms of the offering, is fully paid and
non-assessable. Fund shares are of one class and have equal rights as to
dividends and in liquidation. Shares have no preemptive, subscription or
conversion rights and are freely transferable.
Rule 18f-2 under the 1940 Act provides that any matter required to be
submitted under the provisions of the 1940 Act or applicable state law or
otherwise to the holders of the outstanding voting securities of an
investment company, such as the Company, will not be deemed to have been
effectively acted upon unless approved by the holders of a majority of the
outstanding shares of each series affected by such matter. Rule 18f-2
further provides that a series shall be deemed to be affected by a matter
unless it is clear that the interests of each series in the matter are
identical or that the matter does not affect any interest of such series.
However, the Rule exempts the selection of independent accountants and the
election of Board members from the separate voting requirements of the
Rule.
Each Fund will send annual and semi-annual financial statements to all
its shareholders.
TRANSFER AND DIVIDEND DISBURSING AGENT, CUSTODIAN, COUNSEL
AND INDEPENDENT AUDITORS
Dreyfus Transfer, Inc., a wholly-owned subsidiary of the Manager, P.O.
Box 9671, Providence, Rhode Island 02940-9671, is the Company's transfer
and dividend disbursing agent. Under a transfer agency agreement with the
Company, the Transfer Agent arranges for the maintenance of shareholder
account records for each Fund, the handling of certain communications
between shareholders and the Fund and the payment of dividends and
distributions payable by each Fund. For these services, the Transfer Agent
receives a monthly fee computed on the basis of the number of shareholder
accounts it maintains for the Fund during the month, and is reimbursed for
certain out-of-pocket expenses. For the period December 1, 1995 (effective
date of transfer agency agreement) through May 31, 1996, the Company paid
the Transfer Agent $62,940. The Bank of New York, 90 Washington Street,
New York, New York 10286, is the Company's custodian. Neither the Transfer
Agent nor The Bank of New York has any part in determining the investment
policies of each Fund or which securities are to be purchased or sold by a
Fund.
Stroock & Stroock & Lavan, 7 Hanover Square, New York, New York
10004-2696, as counsel for the Company, has rendered its opinion as to
certain legal matters regarding the due authorization and valid issuance of
the shares being sold pursuant to each Fund's Prospectus.
Ernst & Young LLP, 787 Seventh Avenue, New York, New York 10019,
independent auditors, have been selected as auditors of the Company.
APPENDIX
Description of certain ratings assigned by Standard & Poor's Ratings
Group ("S&P"), Moody's Investors Service, Inc. ("Moody's"), Fitch Investors
Service, L.P. ("Fitch") and Duff & Phelps Credit Rating Co. ("Duff"):
S&P
Bond Ratings
AAA
Bonds rated AAA have the highest rating assigned by S&P. Capacity to
pay interest and repay principal is extremely strong.
AA
Bonds rated AA have a very strong capacity to pay interest and repay
principal and differ from the highest rated issues only in small degree.
A
Bonds rated A have a strong capacity to pay interest and repay
principal although they are somewhat more susceptible to the adverse
effects of changes in circumstances and economic conditions than
obligations in higher rated categories.
BBB
Bonds rated BBB are regarded as having an adequate capacity to pay
interest and repay principal. Whereas they normally exhibit adequate
protection parameters, adverse economic conditions or changing
circumstances are more likely to lead to a weakened capacity to pay
interest and repay principal for bonds in this category than for bonds in
higher rated categories.
S&P's letter ratings may be modified by the addition of a plus (+) or
a minus (-) sign designation, which is used to show relative standing
within the major rating categories, except in the AAA (Prime Grade)
category.
Commercial Paper Rating
An S&P commercial paper rating is a current assessment of the
likelihood of timely payment of debt having an original maturity of no more
than 365 days. Issues assigned an A rating are regarded as having the
greatest capacity for timely payment. Issues in this category are
delineated with the numbers 1, 2 and 3 to indicate the relative degree of
safety.
A-1
This designation indicates that the degree of safety regarding timely
payment is either overwhelming or very strong. Those issues determined to
possess overwhelming safety characteristics are denoted with a plus (+)
designation.
A-2
Capacity for timely payment on issues with this designation is strong.
However, the relative degree of safety is not as high as for issues
designated A-1.
Moody's
Bond Ratings
Aaa
Bonds which are rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and generally are referred to
as "gilt edge." Interest payments are protected by a large or by an
exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can be visualized
are most unlikely to impair the fundamentally strong position of such
issues.
Aa
Bonds which are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what generally are
known as high grade bonds. They are rated lower than the best bonds
because margins of protection may not be as large as in Aaa securities or
fluctuation of protective elements may be of greater amplitude or there may
be other elements present which make the long-term risks appear somewhat
larger than in Aaa securities.
A
Bonds which are rated A possess many favorable investment attributes
and are to be considered as upper medium grade obligations. Factors giving
security to principal and interest are considered adequate, but elements
may be present which suggest a susceptibility to impairment sometime in the
future.
Baa
Bonds which are rated Baa are considered as medium grade obligations,
i.e., they are neither highly protected nor poorly secured. Interest
payments and principal security appear adequate for the present but certain
protective elements may be lacking or may be characteristically unreliable
over any great length of time. Such bonds lack outstanding investment
characteristics and in fact have speculative characteristics as well.
Moody's applies the numerical modifiers 1, 2 and 3 to show relative
standing within the major rating categories, except in the Aaa category.
The modifier 1 indicates a ranking for the security in the higher end of a
rating category; the modifier 2 indicates a mid-range ranking; and the
modifier 3 indicates a ranking in the lower end of a rating category.
Commercial Paper Rating
The rating Prime-1 (P-1) is the highest commercial paper rating
assigned by Moody's. Issuers of P-1 paper must have a superior capacity
for repayment of short-term promissory obligations, and ordinarily will be
evidenced by leading market positions in well established industries, high
rates of return on funds employed, conservative capitalization structures
with moderate reliance on debt and ample asset protection, broad margins in
earnings coverage of fixed financial charges and high internal cash
generation, and well established access to a range of financial markets and
assured sources of alternate liquidity.
Issuers (or related supporting institutions) rated Prime-2 (P-2) have
a strong capacity for repayment of short-term promissory obligations. This
ordinarily will be evidenced by many of the characteristics cited above but
to a lesser degree. Earnings trends and coverage ratios, while sound, will
be more subject to variation. Capitalization characteristics, while still
appropriate, may be more affected by external conditions. Ample alternate
liquidity is maintained.
Fitch
Bond Ratings
The ratings represent Fitch's assessment of the issuer's ability to
meet the obligations of a specific debt issue or class of debt. The
ratings take into consideration special features of the issue, its
relationship to other obligations of the issuer, the current financial
condition and operative performance of the issuer and of any guarantor, as
well as the political and economic environment that might affect the
issuer's future financial strength and credit quality.
AAA
Bonds rated AAA are considered to be investment grade and of the
highest credit quality. The obligor has an exceptionally strong ability to
pay interest and repay principal, which is unlikely to be affected by
reasonably foreseeable events.
AA
Bonds rated AA are considered to be investment grade and of very high
credit quality. The obligor's ability to pay interest and repay principal
is very strong, although not quite as strong as bonds rated AAA. Because
bonds rated in the AAA and AA categories are not significantly vulnerable
to foreseeable future developments, short-term debt of these issuers is
generally rated F-1+.
A
Bonds rated A are considered to be investment grade and of high credit
quality. The obligor's ability to pay interest and repay principal is
considered to be strong, but may be more vulnerable to adverse changes in
economic conditions and circumstances than bonds with higher ratings.
BBB
Bonds rated BBB are considered to be investment grade and of
satisfactory credit quality. The obligor's ability to pay interest and
repay principal is considered to be adequate. Adverse changes in economic
conditions and circumstances, however, are more likely to have an adverse
impact on these bonds and, therefore, impair timely payment. The
likelihood that the ratings of these bonds will fall below investment grade
is higher than for bonds with higher ratings.
Plus (+) and minus (-) signs are used with a rating symbol to indicate
the relative position of a credit within the rating category. Plus and
minus signs, however, are not used in the AAA category covering 12-36
months.
Short-Term Ratings
Fitch's short-term ratings apply to debt obligations that are payable
on demand or have original maturities of up to three years, including
commercial paper, certificates of deposit, medium-term notes, and municipal
and investment notes.
Although the credit analysis is similar to Fitch's bond rating
analysis, the short-term rating places greater emphasis than bond ratings
on the existence of liquidity necessary to meet the issuer's obligations in
a timely manner.
F-1+
Exceptionally Strong Credit Quality. Issues assigned this rating are
regarded as having the strongest degree of assurance for timely payment.
F-1
Very Strong Credit Quality. Issues assigned this rating reflect an
assurance of timely payment only slightly less in degree than issues rated
F-1+.
F-2
Good Credit Quality. Issues carrying this rating have a satisfactory
degree of assurance for timely payments, but the margin of safety is not as
great as the F-1+ and F-1 categories.
Duff
Bond Ratings
AAA
Bonds rated AAA are considered highest credit quality. The risk
factors are negligible, being only slightly more than for risk-free U.S.
Treasury debt.
AA
Bonds rated AA are considered high credit quality. Protection factors
are strong. Risk is modest but may vary slightly from time to time because
of economic conditions.
A
Bonds rated A have protection factors which are average but adequate.
However, risk factors are more variable and greater in periods of economic
stress.
BBB
Bonds rated BBB are considered to have below average protection
factors but still considered sufficient for prudent investment. There may
be considerable variability in risk for bonds in this category during
economic cycles.
Plus (+) and minus (-) signs are used with a rating symbol (except
AAA) to indicate the relative position of a credit within the rating
category.
Commercial Paper Rating
The rating Duff-1 is the highest commercial paper rating assigned by
Duff. Paper rated Duff-1 is regarded as having very high certainty of
timely payment with excellent liquidity factors which are supported by
ample asset protection. Risk factors are minor. Paper rated Duff-2 is
regarded as having good certainty of timely payment, good access to capital
markets and sound liquidity factors and company fundamentals. Risk factors
are small.
<TABLE>
<CAPTION>
DREYFUS INTERNATIONAL EQUITY FUND, INC.
STATEMENT OF INVESTMENTS MAY 31, 1996
COMMON STOCKS-98.8% SHARES VALUE
_______ _______
<S> <C> <C>
AUSTRALIA-2.1% Boral.................................. 800,000 $ 2,103,758
______
CANADA-1.1% Ranger Oil............................. 150,000 1,125,000
______
FINLAND-1.0% Cultor Oy.............................. 22,000 1,030,599
______
FRANCE-7.0% Elf Aquitaine.......................... 14,000 1,015,960
Groupe Danone.......................... 6,500 952,972
Lafarge................................ 13,500 891,186
Michelin, Cl. B........................ 16,000 808,300
Rhone-Poulenc, Cl. A................... 39,000 974,149
Sanofi................................. 18,100 1,396,331
Societe Television Francaise 1......... 10,000 1,169,398
______
7,208,296
______
GERMANY-4.9% Adidas................................. 13,000 977,453
Continental............................ 60,000 1,035,773
Deutsche Bank.......................... 20,000 940,597
Thyssen................................ 6,000 1,111,782
Veba................................... 18,500 969,626
______
5,035,231
______
HONG KONG-3.8% HKR International...................... 596,800 682,723
Hong Kong Electric Holdings............ 300,000 961,712
Hong Kong Land Holdings................ 375,000 825,000
Melco International Development........ 42,500 13,185
Shun Tak Holdings...................... 850,000 565,846
Swire Pacific, Cl. A................... 100,000 888,679
______
3,937,145
______
INDONESIA-1.1% PT Indofood Sukses Makmur............ 150,000 680,210
PT Telekomunikasi Indonesia, A.D.R...(a) 15,000 457,500
______
1,137,710
______
IRELAND-1.2% Independent Newspapers................. 80,000 635,000
Irish Continental Group................ 70,000 600,075
______
1,235,075
______
ITALY-3.0% Credito Italiano....................... 600,000 746,259
Fiat................................... 300,000 1,054,480
Parmalat Finanziaria................... 1,000,000 1,256,073
______
3,056,812
______
JAPAN-34.4% Alpine Electronics..................... 29,000 536,391
Amada.................................. 52,000 538,611
Bank of Tokyo-Mitsubishi............... 54,000 1,278,461
Circle K Japan......................... 22,000 984,741
DDI.................................... 180 1,558,124
DREYFUS INTERNATIONAL EQUITY FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) MAY 31, 1996
COMMON STOCKS (CONTINUED) SHARES VALUE
_______ _______
JAPAN (CONTINUED) Daikin Industries...................... 82,000 $ 887,265
Daiwa House Industry................... 38,000 579,858
Daiwa Securities....................... 40,000 536,391
East Japan Railway..................... 130 715,343
Fuji Photo Film........................ 19,000 590,400
Hitachi................................ 164,000 1,516,693
Hitachi Credit......................... 66,000 1,220,753
Hitachi Zosen.......................... 93,000 515,185
I-O Data Device........................ 10,000 406,918
Ishikawajima-Harima Heavy Industries... 194,000 889,892
Isuzu Motors........................... 160,000 870,064
JGC.................................... 46,000 587,071
JUSCO.................................. 35,000 1,035,790
Kato Denki............................. 25,000 492,463
Kawasaki Heavy Industries.............. 100,000 522,519
Komori................................. 50,000 1,294,738
Maruzen................................ 30,000 520,207
Matsushita Electric Industrial......... 100,000 1,720,152
Mitsubishi Materials................... 293,000 1,707,112
Mitsui & Co............................ 88,000 809,766
Mitsui Fudosan......................... 42,000 532,137
NKK....................................(a) 175,000 511,421
Nippon Express......................... 85,000 848,978
Nippon Steel........................... 167,000 566,808
Nippon Yakin Kogyo..................... 100,000 479,978
Nissan Chemical Industries............. 54,000 386,535
Nissan Motor........................... 17,000 139,767
Nomura Securities...................... 28,000 528,253
P.S. .................................. 400 7,694
Ricoh.................................. 84,000 846,759
Rohm................................... 8,000 499,399
Royal.................................. 16,000 494,220
Sanyo Electric......................... 169,000 1,004,966
Shiseido............................... 99,000 1,226,857
Sony................................... 18,000 1,143,623
Sumitomo Bank.......................... 60,000 1,181,911
Sumitomo Metal Mining.................. 100,000 934,061
TDK.................................... 9,000 511,884
Tokyo Style............................ 6,000 105,984
Toyota Motor........................... 46,000 1,050,772
______
35,316,915
______
MALAYSIA- 3.0% Commerce Asset Holdings................ 80,000 538,526
DCB Holdings........................... 150,000 498,858
DREYFUS INTERNATIONAL EQUITY FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) MAY 31, 1996
COMMON STOCKS (CONTINUED) SHARES VALUE
_______ _______
MALAYSIA (CONTINUED) Edaran Otomobil Nasional............... 75,000 $ 670,153
Metacorp............................... 107,667 293,359
R.J. Reynolds.......................... 100,000 304,524
Renong................................. 490,000 816,765
______
3,122,185
______
MEXICO-2.6% Cemex, Ser. B......................... 125,000 496,978
Fomento Economico Mexicano, Ser. B.... 173,000 510,054
Grupo Carso, Ser. A1..................(a) 67,000 491,363
Grupo Financiero Bancomer, Ser. B.....(a) 1,075,000 475,050
Groupo Televisa, A.D.R. ..............(a) 24,000 738,000
______
2,711,445
______
NETHERLANDS-4.4% Ahrend Groep........................... 25,000 1,114,827
Ahrend Groep (Rights).................. 25,000 11,148
Koninklijke Bijenkorf Beheer........... 15,000 1,179,370
OCE-Van Der Grinten.................... 12,000 1,175,849
Verenigde Nederlandse Uitgeversbedrijven
Verenigd Bezit....................... 60,000 985,742
______
4,466,936
______
NORWAY-2.4% Schibsted Group...................... 115,000 1,536,559
Uni-Storebrand, Cl. A................(a) 200,000 967,549
______
2,504,108
______
SINGAPORE-1.8% DBS Land............................... 314,000 1,044,064
Overseas Union Bank.................... 110,000 781,528
______
1,825,592
______
SPAIN-2.0% Iberdrola.............................. 110,000 1,118,775
Repsol................................. 26,000 891,591
______
2,010,366
______
SWEDEN-6.1% Ericsson (LM) Telephone, Cl. B, A.D.R. 50,000 1,153,125
Scania, Ser. A.......................(a) 22,000 622,422
Scania, Ser. B.......................(a) 42,000 1,188,261
Skandia Forsakring..................... 39,000 995,950
Sparbanken Sverige, Cl. A.............. 90,000 1,058,713
Svenskt Stal, Ser. B................... 90,000 1,152,523
Tornet Fastighets...................... 9,000 77,728
______
6,248,722
______
SWITZERLAND-3.8% ABB.................................... 800 958,206
Elektrowatt, Cl. B..................... 2,700 1,020,336
Roche Holding.......................... 125 960,769
Sandoz................................. 900 935,308
______
3,874,619
______
DREYFUS INTERNATIONAL EQUITY FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) MAY 31, 1996
COMMON STOCKS (CONTINUED) SHARES VALUE
_______ _______
UNITED KINGDOM- 13.1% Asda Group............................. 700,000 $ 1,286,140
Barclays............................... 100,000 1,164,425
British Steel.......................... 330,000 871,110
British Telecommunications............. 255,000 1,405,567
Cookson Group.......................... 300,000 1,416,382
Great Universal Stores................. 100,000 1,053,565
Lloyds TSB Group....................... 206,520 1,002,255
Lucas Industries....................... 300,000 1,139,617
Royal Bank of Scotland Group........... 130,000 1,052,169
TeleWest Communications................ 450,000 1,262,882
United Utilities....................... 75,000 6 77,375
Williams Holdings...................... 225,000 1,159,968
______
13,491,455
______
TOTAL COMMON STOCKS
(cost $95,470,313)................... $101,441,969
======
PREFERRED STOCKS-2.1%
BRAZIL- 1.0% Banco Bradesco......................... 29,000 $ 337,108
Companhia Energetica de Minas Gerais... 12,900 341,923
Petroleo Brasileiro.................... 2,800 338,110
______
1,017,141
______
GERMANY-1.1% Henkel KGaA Vorzug..................... 2,700 1,136,889
______
TOTAL PREFERRED STOCKS
(cost $2,047,237).................... $ 2,154,030
=======
TOTAL INVESTMENTS (cost $97,517,550)........................................ 100.9% $103,595,999
==== =======
LIABILITIES, LESS CASH AND RECEIVABLES...................................... (.9%) $ (885,617)
==== =======
NET ASSETS.................................................................. 100.0% $102,710,382
==== =======
NOTE TO STATEMENT OF INVESTMENTS;
(a) Non-income producing.
See notes to financial statements.
DREYFUS INTERNATIONAL EQUITY FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES MAY 31, 1996
ASSETS:
Investments in securities, at value
(cost $97,517,550)-see statement...................................... $103,595,999
Cash.................................................................... 176,823
Receivable for investment securities sold............................... 2,528,846
Net unrealized appreciation on forward currency exchange contracts-Note 3(a) 838,117
Dividends receivable.................................................... 521,122
Prepaid expenses........................................................ 83,089
______
107,743,996
LIABILITIES:
Due to The Dreyfus Corporation and subsidiaries......................... $ 77,401
Due to Distributor...................................................... 66,818
Payable for investment securities purchased............................. 4,729,391
Accrued expenses........................................................ 160,004 5,033,614
______ _____
NET ASSETS.................................................................. $102,710,382
=======
REPRESENTED BY:
Paid-in capital......................................................... $ 95,246,883
Accumulated undistributed investment income-net......................... 444,797
Accumulated undistributed net realized gain on investments.............. 104,798
Accumulated net unrealized appreciation on investments
and foreign currency transactions..................................... 6,913,904
______
NET ASSETS at value applicable to 6,630,032 shares outstanding
(300 million shares of $.001 par value Common Stock authorized)......... $102,710,382
=======
NET ASSET VALUE, offering and redemption price per share
($102,710,382 / 6,630,032 shares)....................................... $15.49
=======
See notes to financial statements.
DREYFUS INTERNATIONAL EQUITY FUND, INC.
STATEMENT OF OPERATIONS YEAR ENDED MAY 31, 1996
INVESTMENT INCOME:
INCOME:
Cash dividends (net of $376,549 foreign taxes withheld at source)..... $ 2,757,332
Interest.............................................................. 287,687
_____
TOTAL INCOME...................................................... $ 3,045,019
EXPENSES:
Management fee-Note 2(a).............................................. 859,453
Shareholder servicing costs-Note 2(b,c)............................... 1,097,909
Custodian fees........................................................ 144,901
Professional fees..................................................... 84,480
Directors' fees and expenses-Note 2(d)................................ 55,286
Prospectus and shareholders' reports-Note 2(b)........................ 37,981
Registration fees..................................................... 30,166
Miscellaneous......................................................... 25,643
_____
TOTAL EXPENSES.................................................... 2,335,819
_____
INVESTMENT INCOME-NET............................................. 709,200
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments and foreign currency
transactions-Note 3(a)................................................ $10,297,222
Net unrealized appreciation on investments and foreign currency
transactions.......................................................... 3,566,028
_____
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS................... 13,863,250
=======
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................ $14,572,450
=======
See notes to financial statements.
DREYFUS INTERNATIONAL EQUITY FUND, INC.
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED MAY 31,
_________________________________
1995 1996
_______ ______
OPERATIONS:
Investment income-net................................................... $ 144,098 $ 709,200
Net realized gain (loss) on investments................................. (9,638,920) 10,297,222
Net unrealized appreciation (depreciation) on investments for the year.. (2,647,103) 3,566,028
_______ ______
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS....... (12,141,925) 14,572,450
_______ ______
DIVIDENDS TO SHAREHOLDERS:
From investment income-net.............................................. (144,098) --
In excess of investment income-net...................................... (207,897) --
From net realized gain on investments................................... (2,933,301) --
_______ ______
TOTAL DIVIDENDS....................................................... (3,285,296) --
_______ ______
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold........................................... 514,593,936 418,554,429
Dividends reinvested.................................................... 3,064,914 --
Cost of shares redeemed................................................. (544,228,996) (468,325,648)
_______ ______
(DECREASE) IN NET ASSETS FROM CAPITAL STOCK TRANSACTIONS.............. (26,570,146) (49,771,219)
_______ ______
TOTAL (DECREASE) IN NET ASSETS.................................... (41,997,367) (35,198,769)
NET ASSETS:
Beginning of year....................................................... 179,906,518 137,909,151
_______ ______
End of year [including distributions in excess of investment income-net;
($237,568) in 1995 and undistributed investment income-net;
$444,797 in 1996]..................................................... $ 137,909,151 $ 102,710,382
======= ======
SHARES SHARES
_______ ______
CAPITAL SHARE TRANSACTIONS:
Shares sold............................................................. 35,280,834 29,117,194
Shares issued for dividends reinvested.................................. 217,216 --
Shares redeemed......................................................... (37,294,477) (32,523,537)
_______ ______
NET (DECREASE) IN SHARES OUTSTANDING.................................. (1,796,427) (3,406,343)
======= ======
</TABLE>
See notes to financial statements.
DREYFUS INTERNATIONAL EQUITY FUND, INC.
FINANCIAL HIGHLIGHTS
Reference is made to page 3 of the Fund's Prospectus
dated October 1, 1996.
See notes to financial statements.
DREYFUS INTERNATIONAL EQUITY FUND, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
Dreyfus International Equity Fund, Inc. (the "Fund") is registered under
the Investment Company Act of 1940 ("Act") as a non-diversified open-end
management investment company. The Fund's investment objective is to provide
investors with capital growth. The Dreyfus Corporation ("Dreyfus") serves as
the Fund's investment adviser. Dreyfus is a direct subsidiary of Mellon Bank,
N.A. Effective April 1, 1996, M&G Investment Management Limited ("M&G") no
longer serves as the Fund's sub-investment adviser. Premier Mutual Fund
Services, Inc. (the "Distributor") acts as the distributor of the Fund's
shares, which are sold to the public without a sales load.
(A) PORTFOLIO VALUATION: Investments in securities (including options and
financial futures) are valued at the last sales price on the securities
exchange on which such securities are primarily traded or at the last sales
price on the national securities market. Securities not listed on an exchange
or the national securities market, or securities for which there were no
transactions, are valued at the average of the most recent bid and asked
prices, except for open short positions, where the asked price is used for
valuation purposes. Bid price is used when no asked price is available.
Investments denominated in foreign currencies are translated to U.S. dollars
at the prevailing rates of exchange. Forward currency exchange contracts are
valued at the forward rate.
(B) FOREIGN CURRENCY TRANSACTIONS: The Fund does not isolate that portion
of the results of operations resulting from changes in foreign exchange rates
on investments from the fluctuations arising from changes in market prices of
securities held. Such fluctuations are included with the net realized and
unrealized gain or loss from investments.
Net realized foreign exchange gains or losses arise from sales and
maturities of short-term securities, sales of foreign currencies, currency
gains or losses realized on securities transactions, the difference between
the amounts of dividends, interest, and foreign withholding taxes recorded on
the Fund's books, and the U.S. dollar equivalent of the amounts actually
received or paid. Net unrealized foreign exchange gains and losses arise from
changes in the value of assets and liabilities other than investments in
securities, resulting from changes in exchange rates. Such gains and losses
are included with net realized and unrealized gain or loss on investments.
(C) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities
transactions are recorded on a trade date basis. Realized gain and loss from
securities transactions are recorded on the identified cost basis. Dividend
income is recognized on the ex-dividend date and interest income, including,
where applicable, amortization of discount on investments, is recognized on
the accrual basis.
(D) DIVIDENDS TO SHAREHOLDERS: Dividends are recorded on the ex-dividend
date. Dividends from investment income-net and dividends from net realized
capital gain are normally declared and paid annually, but the Fund may make
distributions on a more frequent basis to comply with the distribution
requirements of the Internal Revenue Code. To the extent that net realized
capital gain can be offset by capital loss carryovers it is the policy of the
Fund not to distribute such gain.
Dividends and distributions from net investment income and realized
capital gains are determined in accordance with Federal Income Tax
regulations which may differ from net investment income and net
DREYFUS INTERNATIONAL EQUITY FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
realized capital gains as determined in accordance with generally accepted
accounting principles. These differences, which have resulted from the
classification of gains/losses recognized on foreign currency transactions
and Passive Foreign Investment Companies have been reclassified within the
capital accounts based on their Federal tax-basis treatment. To reflect these
reclassifications, during the year ended May 31, 1996, the Fund credited
paid-in capital $167,356 and charged accumulated undistributed net investment
income and accumulated net realized loss on investments $26,835 and $140,521
respectively. During the year ended May 31, 1995, the Fund charged paid-in
capital $253,131, and credited accumulated undistributed net investment
income and accumulated net realized loss on investments $68,998 and $184,132
respectively. These reclassifications had no effect on net investment income,
net realized gains and net assets.
(E) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to
qualify as a regulated investment company, if such qualification is in the
best interests of its shareholders, by complying with the applicable
provisions of the Internal Revenue Code, and to make distributions of taxable
income sufficient to relieve it from substantially all Federal income and
excise taxes.
NOTE 2-INVESTMENT ADVISORY FEE, SUB-INVESTMENT ADVISORY FEE AND OTHER
TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement ("Agreement") with Dreyfus, the
management fee is computed at the annual rate of .75 of 1% of the value of
the Fund's average daily net assets and is payable monthly. The Agreement
provides for an expense reimbursement from Dreyfus should the Fund's
aggregate expenses, exclusive of interest, taxes, brokerage and extraordinary
expenses, exceed the expense limitation of any state having jurisdiction over
the Fund. The most stringent state expense limitation applicable to the Fund
presently requires reimbursement of expenses in any full fiscal year that
such expenses (excluding distribution expenses and certain expenses as
described above) exceed 2 1/2% of the first $30 million, 2% of the next $70
million and 1 1/2% of the excess over $100 million of the average value of the
Fund's net assets in accordance with California "blue sky" regulations. No
expense reimbursement was required for the year ended May 31, 1996.
Prior to April 1, 1996, a Sub-Investment Advisory Agreement was in effect
between Dreyfus and M&G. The sub-advisory fee was computed at the annual rate
of .30 of 1% of the value of the Fund's average daily net assets and was
payable monthly by Dreyfus.
(B) Pursuant to the Fund's Distribution Plan (the "Plan") pursuant to
Rule 12b-1 under the Act, the Fund (a) reimburses the Distributor for
payments to certain Service Agents (a securities dealer, financial
institution or other industry professional) for distributing the Fund's
shares and (b) pays the Manager, Dreyfus Service Corporation, a wholly-owned
subsidiary of Dreyfus, and any affiliate of either of them for advertising
and marketing relating to the Fund, at an aggregate annual rate of .50 of 1%
of the value of the Fund's average daily net assets. The Distributor may pay
one or more Service Agents in respect of distribution services. The
Distributor determines the amounts, if any, to be paid to Service Agents
under the Plan and the basis on which such payments are made. The fees
payable under the Plan are payable without regard to actual expenses
incurred. The Plan also separately provides for the Fund to bear the costs of
preparing, printing and distributing certain of the Fund's prospectuses and
statements of
DREYFUS INTERNATIONAL EQUITY FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
additional information and costs associated with implementing and operating
the Plan, not to exceed the greater of $100,000 or .005 of 1% of the Fund's
average daily net assets for any full fiscal year. During the year ended May
31, 1996, $589,143 was charged to the Fund pursuant to the Plan.
(C) Pursuant to the Fund's Shareholder Services Plan, the Fund pays the
Distributor an annual rate of .25 of 1% of the value of the Fund's average
daily net assets for the provision of certain services. The services provided
may include personal services relating to shareholder accounts, such as
answering shareholder inquiries regarding the Fund and providing reports and
other information, and services related to the maintenance of shareholder
accounts. The Distributor may make payments to Service Agents in respect of
these services. The Distributor determines the amounts to be paid to Service
Agents. During the year ended May 31, 1996, the Fund was charged an aggregate
of $286,484 pursuant to the Shareholder Services Plan.
Effective December 1, 1995, the Fund compensates Dreyfus Transfer, Inc.,
a wholly-owned subsidiary of the Manager, under a transfer agency agreement
for providing personnel and facilities to perform transfer agency services
for the Fund. Such compensation amounted to $62,940 for the period from
December 1, 1995 through May 31, 1996.
(D) Each director who is not an "affiliated person" as defined in the Act
receives from the Fund an annual fee of $2,500 and an attendance fee of $500
per meeting. The Chairman of the Board receives an additional 25% of such
compensation.
NOTE 3-SECURITIES TRANSACTIONS:
(A) The aggregate amount of purchases and sales of investment securities,
excluding short-term securities and forward currency exchange contracts,
during the year ended May 31, 1996 amounted to $112,546,967 and $147,430,268,
respectively.
In addition the following summarizes open forward currency exchange
contracts at May 31, 1996:
<TABLE>
<CAPTION>
FOREIGN UNREALIZED
CURRENCY APPRECIATION
FORWARD CURRENCY SALE CONTRACTS AMOUNT PROCEEDS VALUE (DEPRECIATION)
___________________ ------- --------- ------ -----------
<S> <C> <C> <C> <C>
Dutch Guilders, expiring 6/10/96............. 7,500,000 $ 4,479,216 $ 4,404,096 $ 75,120
French Francs, expiring 7/9/96............... 28,264,276 5,612,000 5,493,276 118,724
German Deutsche Marks, expiring 7/9/96....... 7,468,422 5,074,001 4,915,699 158,302
Italian Lira, expiring 6/24/96............... 3,246,563,000 2,083,200 2,099,216 (16,016)
Japanese Yen, expiring 6/24/96............... 1,519,548,900 14,524,914 14,128,110 396,804
Swedish Krona, expiring 6/10/96.............. 30,000,000 4,448,399 4,468,741 (20,342)
Swiss Francs, expiring 6/10/96............... 6,000,000 4,937,459 4,811,934 125,525
____
$838,117
=====
</TABLE>
The Fund enters into forward currency exchange contracts in order to
hedge its exposure to changes in foreign currency exchange rates on its
foreign portfolio holdings. When executing forward currency exchange
contracts, the Fund is obligated to buy or sell a foreign currency at a
specified rate on a certain date in the future. With respect to sales of
forward currency exchange contracts, the Fund would incur a loss if the value
of the contract increases between the date the forward contract is opened and
the date the forward contract is closed. The Fund realizes a gain if the
value of the contract decreases between
DREYFUS INTERNATIONAL EQUITY FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
those dates. With respect to purchases of forward currency exchange
contracts, the Fund would incur a loss if the value of the contract decreases
between the date the forward contract is opened and the date the forward
contract is closed. The Fund realizes a gain if the value of the contract
increases between those dates. The Fund is also exposed to credit risk
associated with counter party nonperformance on these forward currency
exchange contracts which is typically limited to the unrealized gains on such
contracts that are recognized in the Statement of Assets and Liabilities.
(B) At May 31, 1996, accumulated net unrealized appreciation on
investments and forward currency exchange contracts was $6,916,566,
consisting of $9,091,982 gross unrealized appreciation and $2,175,416 gross
unrealized depreciation.
At May 31, 1996, the cost of investments for Federal income tax purposes
was substantially the same as the cost for financial reporting purposes (see
the Statement of Investments).
DREYFUS INTERNATIONAL EQUITY FUND, INC.
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
SHAREHOLDERS AND BOARD OF DIRECTORS
DREYFUS INTERNATIONAL EQUITY FUND, INC.
We have audited the accompanying statement of assets and liabilities of
Dreyfus International Equity Fund, Inc., including the statement of
investments, as of May 31, 1996, and the related statement of operations for
the year then ended, the statement of changes in net assets for each of the
two years in the period then ended, and financial highlights for each of the
years indicated therein. These financial statements and financial highlights
are the responsibility of the Fund's management. Our responsibility is to
express an opinion on these financial statements and financial highlights
based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of May 31, 1996 by correspondence with the custodian and
brokers. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of Dreyfus International Equity Fund, Inc. at May 31, 1996, the
results of its operations for the year then ended, the changes in its net
assets for each of the two years in the period then ended, and the financial
highlights for each of the indicated years, in conformity with generally
accepted accounting principles.
[Ernst and Young LLP signature logo]
New York, New York
July 8, 1996
<PAGE>
International
Growth Fund
Semi-Annual
Report
November 30, 1996
<PAGE>
Dreyfus International Growth Fund
(formerly Dreyfus International Equity Fund, Inc.)--See Note 1
- --------------------------------------------------------------
Letter to Shareholders
Dear Shareholder:
Dreyfus International Growth Fund
(formerly Dreyfus International Equity Fund, Inc.)--See Note 1
- ----------------------------------------------------------------
Statement of Investments November 30, 1996 (Unaudited)
<TABLE>
<CAPTION>
Common Stocks--96.5% Shares Value
- -------------------------------------------------------------------------------------------------- ---------- -----------
<S> <C> <C> <C> <C>
Australia--1.1% Boral................................................ 400,000 $ 1,045,176
-----------
Brazil--.5% Telecomunicacoes Brasileiras, A.D.R.................. 6,400 484,800
-----------
Canada--1.4% Ranger Oil........................................... 150,000 1,312,500
-----------
China--3.1% China Overseas Land & Investment..................... 1,000,000 381,531
China Resources Enterprise........................... 325,000 466,568
Guangnan Holdings.................................... 276,000 217,744
New World Infrastructure..........................(a) 400,000 1,189,860
Shanghai Industrial Holdings......................... 250,000 813,179
-----------
3,068,882
-----------
Finland--1.1% Cultor Oy, Ser. 1.................................... 22,000 1,042,654
-----------
France--5.3% Banque Nationale de Paris............................ 30,000 1,194,487
Compagnie Generale des Eaux.......................... 10,000 1,232,772
Elf Aquitaine........................................ 7,000 611,160
Lafarge.............................................. 6,500 410,605
Michelin, Cl. B...................................... 18,000 923,086
Thomson.............................................. 25,000 808,288
-----------
5,180,398
-----------
Germany--2.6% Continental.......................................... 60,000 1,037,711
Deutsche Bank........................................ 28,000 1,334,460
Henkel KGaA.......................................... 2,700 131,665
-----------
2,503,836
-----------
Hong Kong--9.2% Bank of East Asia.................................... 140,000 599,328
Cheung Kong Holdings................................. 145,000 1,275,220
Henderson Land Development........................... 100,000 1,005,561
HKR International.................................... 656,480 972,154
Hong Kong & China Gas................................ 300,000 595,577
Hong Kong Telecommunications, A.D.R.................. 55,000 962,500
HSBC Holdings........................................ 53,000 1,103,596
Hutchison Whampoa.................................... 90,000 695,486
New World Development................................ 125,000 844,704
Swire Pacific, Cl. A................................. 100,000 947,362
-----------
9,001,488
-----------
Ireland--2.3% Independent Newspapers............................... 160,000 820,816
Irish Continental Group.............................. 70,000 512,169
Jurys Hotel Group.................................... 205,000 955,124
-----------
2,288,109
-----------
Italy--4.1% Fiat................................................. 300,000 882,772
Istituto Nazionale delle Assicurazioni............... 950,000 1,309,934
Parmalat Finanziaria................................. 1,140,000 1,769,822
-----------
3,962,528
-----------
<PAGE>
Dreyfus International Growth Fund
(formerly Dreyfus International Equity Fund, Inc.)--See Note 1
- ------------------------------------------------------------------------
Statement of Investments (continued) November 30, 1996 (Unaudited)
Common Stocks (continued) Shares Value
- -------------------------------------------------------------------------------------------------- ---------- -----------
Japan--34.2% Bank of Tokyo-Mitsubishi............................. 54,000 $ 1,104,653
DDI.................................................. 180 1,287,972
Daikin Industries.................................... 107,000 995,786
Dainippon Ink & Chemicals............................ 190,000 752,327
Daiwa Securities..................................... 40,000 431,958
Eisai................................................ 30,000 589,991
Fuji Photo Film...................................... 46,000 1,441,791
Industrial Bank of Japan............................. 50,000 987,708
Ishikawajima-Harima Heavy Industries................. 194,000 902,722
Kato Denki........................................... 22,600 287,709
Komatsu Forklift..................................... 32,000 202,564
Laox................................................. 36,500 560,799
Maruzen.............................................. 30,000 316,067
Matsushita-Kotobuki Electron......................... 25,000 640,913
Matsushita Communication............................. 48,000 1,247,410
Matsushita Electric Industrial....................... 100,000 1,729,587
Minebea.............................................. 120,000 1,024,056
Mitsui & Co.......................................... 88,000 747,884
NKK...............................................(a) 175,000 430,202
Namco................................................ 20,000 626,866
Nichiei.............................................. 12,000 835,470
Nintendo............................................. 20,000 1,406,497
Nippon Steel......................................... 167,000 504,372
Nippon Telegraph & Telephone......................... 200 1,425,812
Nitto Electric Works................................. 75,000 1,376,207
P.S.................................................. 400 6,427
Rohm................................................. 25,000 1,536,435
Sankyo............................................... 45,000 1,205,004
Sekisui House........................................ 70,000 749,781
Shiseido............................................. 99,000 1,190,781
Sony................................................. 26,000 1,664,091
Sumitomo Bank........................................ 60,000 1,043,020
TDK.................................................. 22,000 1,417,735
Tokyo Style.......................................... 60,000 884,987
Toyota Motor......................................... 71,000 1,938,630
-----------
33,494,214
-----------
Malaysia--5.3% Commerce Asset Holdings.............................. 40,000 305,500
DCB Holdings......................................... 75,000 256,727
Edaran Otomobil Nasional............................. 75,000 739,019
Kentucky Fried Chicken Holdings...................... 225,000 997,230
Renong............................................... 490,000 903,601
Road Builder (M) Holdings............................ 130,000 673,922
Tenaga Nasional...................................... 275,000 1,251,484
-----------
5,127,483
-----------
<PAGE>
Dreyfus International Growth Fund
(formerly Dreyfus International Equity Fund, Inc.)--See Note 1
- -----------------------------------------------------------------------------
Statement of Investments (continued) November 30, 1996 (Unaudited)
Common Stocks (continued) Shares Value
- -------------------------------------------------------------------------------------------------- ---------- -----------
Mexico--.8% Grupo Casa Autrey, A.D.R............................. 20,000 $ 387,500
Grupo Financiero Bancomer, Cl.B...................(a) 1,075,000 433,407
Grupo Financiero Inbursa, Cl.B....................... 2,338 7,440
-----------
828,347
-----------
Netherlands--6.1% ABN Amro Holding..................................... 15,000 971,868
Goudsmit............................................. 12,000 1,064,965
Philips Electronics.................................. 43,000 1,738,457
PolyGram............................................. 20,000 964,037
Verenigde Nederlandse Uitgeversbedrijven
Verenigd Bezit..................................... 60,000 1,225,058
-----------
5,964,385
-----------
New Zealand--1.9% Fletcher Challenge Building.......................... 275,000 772,867
Lion Nathan.......................................... 400,000 1,027,406
-----------
1,800,273
-----------
Norway--1.5% Schibsted............................................ 80,000 1,457,944
-----------
Philippines--1.0% Ayala Land, Cl.B..................................... 262,500 284,675
Filinvest Land....................................(a) 500,000 176,941
Manila Electric, Cl.B................................ 45,500 337,614
Pilipino Telephone................................(a) 200,000 175,038
-----------
974,268
-----------
Portugal--.8% Cimpor-Cimentos de Portugal.......................... 38,000 794,011
-----------
Sweden--2.7% Skandia Forsakrings.................................. 59,000 1,681,324
Sparbanken Sverige, Cl.A............................. 60,000 991,072
-----------
2,672,396
-----------
Switzerland--1.6% Elektrowatt, Cl.B.................................... 1,400 561,934
Sandoz............................................... 900 1,047,122
-----------
1,609,056
-----------
Thailand--1.4% Finance One Public (Foreign Registered).............. 57,000 162,921
Industrial Finance Corporation of Thailand........... 47,000 149,060
Industrial Finance Corporation of Thailand
(Foreign Registered)............................... 74,000 233,242
Krung Thai Bank Public
(Foreign Registered)............................... 82,000 234,378
PTT Exploration & Production Public
(Foreign Registered)............................... 40,000 588,880
-----------
1,368,481
-----------
<PAGE>
Dreyfus International Growth Fund
(formerly Dreyfus International Equity Fund, Inc.)--See Note 1
- -----------------------------------------------------------------------------
Statement of Investments (continued) November 30, 1996 (Unaudited)
Common Stocks (continued) Shares Value
- -------------------------------------------------------------------------------------------------- ---------- -----------
United Kingdom--8.5% British Sky Broadcasting Group....................... 190,000 $ 1,649,033
Grand Metropolitan................................... 135,000 1,054,740
Great Universal Stores............................... 100,000 1,153,852
TeleWest Communications...........................(a) 450,000 915,849
Viatel............................................... 108,000 1,080,000
Vodafone Group....................................... 580,000 2,512,067
-----------
8,365,541
-----------
TOTAL COMMON STOCKS
(cost $89,441,197)................................. $94,346,770
-----------
-----------
Preferred Stocks--2.3%
- --------------------------------------------------------------------------------------------------
Brazil--1.5% Banco Bradesco....................................... 43,500 $ 315,828
Companhia Energetica de Minas Gerais................. 12,900 412,100
Petroleo Brasileiro.................................. 2,800 382,215
Telecomunicacoes do Rio de Janeiro................(a) 3,500 362,537
-----------
1,472,680
-----------
Germany--.8% Henkel KGaA Vorzug................................... 16,300 811,820
-----------
TOTAL PREFERRED STOCKS
(cost $ 2,014,729)................................. $ 2,284,500
-----------
-----------
Principal
Short-Term Investments--.4% Amount
- -------------------------------------------------------------------------------------------------- -------------
United States; U.S. Treasury Bills;
5.10%, 12/19/96
(cost $437,881).................................... $ 439,000 $ 437,810
-----------
-----------
TOTAL INVESTMENTS (cost $ 91,893,807)............................................................. 99.2% $97,069,080
------ -----------
------ -----------
CASH AND RECEIVABLES (NET)........................................................................ .8% $ 753,720
------ -----------
------ -----------
NET ASSETS........................................................................................ 100.0% $97,822,800
------ -----------
------ -----------
<FN>
Notes to Statement of Investments:
(a) Non-income producing.
</TABLE>
See notes to financial statements.
<PAGE>
Dreyfus International Growth Fund
(formerly Dreyfus International Equity Fund, Inc.)--See Note 1
- -------------------------------------------------------------------------------
Statement of Assets and Liabilities November 30, 1996 (Unaudited)
<TABLE>
<CAPTION>
Cost Value
----------- ------------
<S> <C> <C> <C>
ASSETS: Investments in securities--See Statement of Investments............ $91,893,807 $ 97,069,080
Cash............................................................... 4,134,192
Receivable for investment securities sold and
forward currency exchange contracts.............................. 598,478
Dividends and interest receivable.................................. 244,337
Prepaid expenses................................................... 52,942
------------
102,099,029
------------
LIABILITIES: Due to The Dreyfus Corporation and affiliates...................... 69,089
Due to Distributor................................................. 60,807
Payable for investment securities purchased and
forward currency exchange contracts.............................. 4,023,733
Accrued expenses................................................... 122,600
------------
4,276,229
------------
NET ASSETS.............................................................................. $ 97,822,800
------------
------------
REPRESENTED BY: Paid-in capital.................................................... $ 88,343,913
Accumulated undistributed investment income--net................... 371,603
Accumulated net realized gain (loss) on investments,
foreign currency transactions and forward currency
exchange contracts............................................... 3,935,334
Accumulated net unrealized appreciation (depreciation)
on investments and foreign currency transactions................. 5,171,950
------------
NET ASSETS.............................................................................. $ 97,822,800
------------
------------
SHARES OUTSTANDING
(300 million shares of $.001 par value Common Stock authorized)......................... 6,227,038
NET ASSET VALUE, offering and redemption price per share................................ $15.71
------
------
See notes to financial statements.
</TABLE>
See notes to financial statements.
<PAGE>
Dreyfus International Growth Fund
(formerly Dreyfus International Equity Fund, Inc.)--See Note 1
- -------------------------------------------------------------------------------
Statement of Operations Six Months Ended November 30, 1996 (Unaudited)
<TABLE>
<CAPTION>
INVESTMENT INCOME
<S> <C> <C> <C>
INCOME: Cash dividends
(net of $94,774 foreign taxes withheld at source).............. $ 840,255
Interest......................................................... 93,444
----------
Total Income............................................... $ 933,699
EXPENSES: Management fee--Note 2(a)........................................ 375,073
Shareholder servicing costs--Note 2(b,c)......................... 486,944
Custodian fees................................................... 56,148
Professional fees................................................ 28,495
Directors' fees and expenses--Note 2(d).......................... 21,084
Registration fees................................................ 17,998
Prospectus and shareholders' reports--Note 2(b).................. 8,991
Miscellaneous.................................................... 12,160
----------
Total Expenses............................................. 1,006,893
----------
INVESTMENT (LOSS)--NET............................................................. (73,194)
----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--Note 3:
Net realized gain (loss) on investments and
foreign currency transactions.................................. $2,700,147
Net realized gain (loss) on forward currency
exchange contracts:
Short transactions............................................. 1,130,389
----------
Net Realized Gain (Loss)....................................... 3,830,536
Net unrealized appreciation (depreciation) on investments
and foreign currency transactions.............................. (1,741,954)
----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS............................. 2,088,582
----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS............................... $2,015,388
----------
----------
</TABLE>
See notes to financial statements.
<PAGE>
Dreyfus International Growth Fund
(formerly Dreyfus International Equity Fund, Inc.)--See Note 1
- ----------------------------------------------------------------------------
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Six Months Ended
November 30, 1996 Year Ended
(Unaudited) May 31, 1996
----------------- ------------
<S> <C> <C>
OPERATIONS:
Investment income (loss)--net................................................. $ (73,194) $ 709,200
Net realized gain (loss) on investments....................................... 3,830,536 10,297,222
Net unrealized appreciation (depreciation) on investments..................... (1,741,954) 3,566,028
------------- ------------
Net Increase (Decrease) in Net Assets Resulting from Operations............. 2,015,388 14,572,450
------------- ------------
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold................................................. 214,353,261 418,554,429
Cost of shares redeemed....................................................... (221,256,231) (468,325,648)
------------- ------------
Increase (Decrease) in Net Assets from Capital Stock Transactions........... (6,902,970) (49,771,219)
------------- ------------
Total Increase (Decrease) in Net Assets................................... (4,887,582) (35,198,769)
------------- ------------
NET ASSETS:
Beginning of Period........................................................... 102,710,382 137,909,151
------------- ------------
End of Period................................................................. $ 97,822,800 $102,710,382
------------- ------------
------------- ------------
Undistributed investment income--net............................................ $ 371,603 $ 444,797
------------- ------------
Shares Shares
------------- ------------
CAPITAL SHARE TRANSACTIONS:
Shares sold................................................................... 14,043,560 29,117,194
Shares redeemed............................................................... (14,446,554) (32,523,537)
------------- ------------
Net Increase (Decrease) in Shares Outstanding............................... (402,994) (3,406,343)
------------- ------------
------------- ------------
</TABLE>
See notes to financial statements.
<PAGE>
Dreyfus International Growth Fund
(formerly Dreyfus International Equity Fund, Inc.)--See Note 1
- ----------------------------------------------------------------------------
Financial Highlights
Contained below is per share operating performance data for a share
of Common Stock outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This information
has been derived from the Fund's financial statements.
<TABLE>
<CAPTION>
Year Ended May 31,
Six Months Ended ----------------------------
November 30, 1996
PER SHARE DATA: (Unaudited) 1996 1995 1994(1)
----------------- ------ ------ --------
<S> <C> <C> <C> <C>
Net asset value, beginning of period..................... $15.49 $13.74 $15.20 $12.50
------ ------ ------ ------
Investment Operations:
Investment income (loss)--net............................ (.01) .09 .01 .05
Net realized and unrealized gain (loss)
on investments......................................... .23 1.66 (1.19) 2.74
------ ------ ------ ------
Total from Investment Operations......................... .22 1.75 (1.18) 2.79
------ ------ ------ ------
Distributions:
Dividends from investment income--net.................... -- -- (.01) (.02)
Dividends in excess of investment income--net............ -- -- (.02) (.04)
Dividends from net realized gain on investments.......... -- -- (.25) (.03)
------ ------ ------ ------
Total Distributions...................................... -- -- (.28) (.09)
------ ------ ------ ------
Net asset value, end of period........................... $15.71 $15.49 $13.74 $15.20
------ ------ ------ ------
------ ------ ------ ------
TOTAL INVESTMENT RETURN.................................... 1.42%(2) 12.74% (7.81%) 22.32%(2)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets.................. 1.01%(2) 2.04% 1.92% 1.71%(2)
Ratio of net investment income
to average net assets.................................. (.07%)(2) .62% .09% .11%(2)
Decrease reflected in above expense ratios
due to undertakings by the Manager..................... -- -- -- .16%(2)
Portfolio Turnover Rate.................................. 71.65%(2) 96.45% 40.15% 51.32%(2)
Average commission rate paid(3).......................... $.0183 -- -- --
Net Assets, end of period (000's Omitted)................ $97,823 $102,710 $137,909 $179,907
<FN>
- -----------------
(1) From June 29, 1993 (commencement of operations) to May 31, 1994.
(2) Not annualized.
(3) For fiscal years beginning December 1, 1995, the Fund is required
to disclose its average commission rate paid per share for purchases
and sales of investment securities.
</TABLE>
See notes to financial statements.
<PAGE>
Dreyfus International Growth Fund
(formerly Dreyfus International Equity Fund, Inc.)--See Note 1
- -----------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (Unaudited)
NOTE 1--Significant Accounting Policies:
Dreyfus International Funds, Inc. (the "Company") is registered under the
Investment Company Act of 1940 ("Act") as a non-diversified open-end
management investment company and operates as a series company currently
offering two series, including the Dreyfus International Growth Fund (the
"Fund"). The Fund's investment objective is to provide investors with capital
growth. The Dreyfus Corporation ("Manager") serves as the Fund's investment
adviser. The Manager is a direct subsidiary of Mellon Bank, N.A. Premier Mutual
Fund Services, Inc. (the "Distributor") acts as the distributor of the Fund's
shares, which are sold to the public without a sales load.
Effective June 24, 1996, the Fund changed its name from "Dreyfus
International Equity Fund, Inc." to "Dreyfus International Growth Fund."
The Company accounts separately for the assets, liabilities and operations
of each fund. Expenses directly attributable to each fund are charged to that
fund's operation; expenses which are applicable to all funds are allocated
among them on a pro rata basis.
The Fund's financial statements are prepared in accordance with generally
accepted accounting principles which may require the use of management
estimates and assumptions. Actual results could differ from those estimates.
(a) Portfolio valuation: The Fund's investments in securities (including
options and financial futures) are valued at the last sales price on the
securities exchange on which such securities are primarily traded or at the
last sales price on the national securities market. Securities not listed on
an exchange or the national securities market, or securities for which there
were no transactions, are valued at the average of the most recent bid and
asked prices, except for open short positions, where the asked price is used
for valuation purposes. Bid price is used when no asked price is available.
Investments denominated in foreign currencies are translated to U.S. dollars at
the prevailing rates of exchange. Forward currency exchange contracts are
valued at the forward rate.
(b) Foreign currency transactions: The Fund does not isolate that portion
of the results of operations resulting from changes in foreign exchange rates
on investments from the fluctuations arising from changes in the market prices
of securities held. Such fluctuations are included with the net realized and
unrealized gain or loss from investments.
Net realized foreign exchange gains or losses arise from sales and
maturities of short-term securities, sales of foreign currencies, currency
gains or losses realized on securities transactions, the difference between the
amount of dividends, interest and foreign withholding taxes recorded on the
Fund's books, and the U.S. dollar equivalent of the amounts actually received
or paid. Net unrealized foreign exchange gains and losses arise from changes
in the value of assets and liabilities other than investments in securities,
resulting from changes in exchange rates. Such gains and losses are included
with net realized and unrealized gain or loss on investments.
(c) Securities transactions and investment income: Securities transactions
are recorded on a trade date basis. Realized gain and loss from securities
transactions are recorded on the identified cost basis. Dividend income is
recognized on the ex-dividend date and interest income, including, where
applicable, amortization of discount on investments, is recognized on the
accrual basis.
<PAGE>
Dreyfus International Growth Fund
(formerly Dreyfus International Equity Fund, Inc.)--See Note 1
- -----------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (Unaudited) (continued)
(d) Dividends to shareholders: Dividends are recorded on the ex-dividend
date. Dividends from investment income-net and dividends from net realized
capital gain are normally declared and paid annually, but the Fund may make
distributions on a more frequent basis to comply with the distribution
requirements of the Internal Revenue Code. To the extent that net realized
capital gain can be offset by capital loss carryovers, if any, it is the policy
of the Fund not to distribute such gain.
(e) Federal income taxes: It is the policy of the Fund to continue to
qualify as a regulated investment company, if such qualification is in the best
interests of its shareholders, by complying with the applicable provisions of
the Internal Revenue Code, and to make distributions of taxable income
sufficient to relieve it from substantially all Federal income and excise
taxes.
NOTE 2--Management Fee and Other Transactions with Affiliates:
(a) Pursuant to a management agreement ("Agreement") with the Manager, the
management fee is computed at the annual rate of .75 of 1% of the value of the
Fund's average daily net assets and is payable monthly.
(b) Under the Distribution Plan (the "Plan") pursuant to Rule 12b-1 under
the Act, the Fund (a) reimburses the Distributor for payments to certain
Service Agents (a securities dealer, financial institution or other industry
professional) for distributing the Fund's shares and (b) pays the Manager,
Dreyfus Service Corporation, a wholly-owned subsidiary of Dreyfus, and any
affiliate of either of them for advertising and marketing relating to the Fund,
at an aggregate annual rate of .50 of 1% of the value of the Fund's average
daily net assets. The Distributor may pay one or more Service Agents in
respect of distribution services. The Distributor determines the amounts, if
any, to be paid to Service Agents under the Plan and the basis on which such
payments are made. The fees payable under the Plan are payable without regard
to actual expenses incurred. The Plan also separately provides for the Fund to
bear the costs of preparing, printing and distributing certain of the Fund's
prospectuses and statements of additional information and costs associated with
implementing and operating the Plan, not to exceed the greater of $100,000 or
.005 of 1% of the Fund's average daily net assets for any full fiscal year.
During the period ended November 30, 1996, $250,791 was charged to the Fund
pursuant to the Plan.
(c) Under the Shareholder Services Plan, the Fund pays the Distributor an
annual rate of .25 of 1% of the value of the Fund's average daily net assets
for the provision of certain expenses. The services provided may include
personal services relating to shareholder accounts, such as answering
shareholder inquiries regarding the Fund and providing reports and other
information, and services related to the maintenance of shareholder accounts.
The Distributor may make payments to Service Agents in respect of these
services. The Distributor determines the amounts to be paid to Service Agents.
During the period ended November 30, 1996, the Fund was charged an aggregate of
$125,024 pursuant to the Shareholder Services Plan.
The Fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of
the Manager, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency services for the Fund. Such compensation
amounted to $56,558 during the period ended November 30, 1996.
(d) Each director who is not an "affiliated person" as defined in the Act
receives from the Company an annual fee of $2,500 and an attendance fee of $500
per meeting. The Chairman of the Board receives an additional 25% of such
compensation.
<PAGE>
Dreyfus International Growth Fund
(formerly Dreyfus International Equity Fund, Inc.)--See Note 1
- ---------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (Unaudited) (continued)
NOTE 3--Securities Transactions:
(a) The aggregate amount of purchases and sales of investment securities,
excluding short-term securities and forward currency exchange contracts, during
the period ended November 30, 1996 amounted to $68,345,921 and $77,115,905,
respectively.
The Fund enters into forward currency exchange contracts in order to hedge
its exposure to changes in foreign currency exchange rates on its foreign
portfolio holdings. When executing forward currency exchange contracts, the
Fund is obligated to buy or sell a foreign currency at a specified rate on a
certain date in the future. With respect to sales of forward currency exchange
contracts, the Fund would incur a loss if the value of the contract increases
between the date the forward contract is opened and the date the forward
contract is closed. The Fund realizes a gain if the value of the contract
decreases between those dates. With respect to purchases of forward currency
exchange contracts, the Fund would incur a loss if the value of the contract
decreases between the date the forward contract is opened and the date the
forward contract is closed. The Fund realizes a gain if the value of the
contract increases between those dates. The Fund is also exposed to credit
risk associated with counter party nonperformance on these forward currency
exchange contracts which is typically limited to the unrealized gains on such
contracts that are recognized in the Statement of Assets and Liabilities. At
November 30, 1996, there were no open forward currency exchange contracts.
(b) At November 30, 1996, accumulated net unrealized appreciation on
investments was $5,175,273, consisting of $9,115,026 gross unrealized
appreciation and $3,939,753 gross unrealized depreciation.
At November 30, 1996, the cost of investments for Federal income tax
purposes was substantially the same as the cost for financial reporting
purposes (see the Statement of Investments).
<PAGE>
Dreyfus International
Growth Fund
200 Park Avenue
New York, NY 10166
Investment Adviser
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
Custodian
The Bank of New York
90 Washington Street
New York, NY 10286
Transfer Agent &
Dividend Disbursing Agent
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Printed in U.S.A. 095SA9611
<TABLE>
<CAPTION>
DREYFUS EMERGING MARKETS FUND
STATEMENT OF INVESTMENTS NOVEMBER 30, 1996 (UNAUDITED)
Common Stocks-80.4% Shares Value
______ ______
<S> <C> <C>
Argentina-5.5% Central Costanera, Cl. B............... 61,000 $ 195,298
Disco, ADR............................. 4,000 (a) 100,500
Telefonica de Argentina, ADR........... 6,500 165,750
YPF Sociedad Anonima, ADR.............. 11,400 265,050
______
726,598
______
Brazil-7.0% Aracruz Celulose, ADR.................. 18,100 140,275
Companhia Brasileira de Distribuicao Grupo
Pao de Acucar........................ 4,800 80,400
Companhia Energentina De Minas Gerais, ADR 9,200 293,250
Companhia Vale do Rio Doce............. 7,100 148,213
Telecomunicacoes Brasileiras, ADR...... 3,500 265,125
______
927,263
______
Chile-4.3% Banco BHIF, ADR........................ 13,300 (a) 224,438
Compania De Telecomunicaciones, ADR.... 1,500 142,687
Cristalerias De Chile, ADR............. 10,400 201,500
______
568,625
______
China-.9% Ek Chor China Motorcycle, ADR.......... 5,600 41,300
Jilin Chemicals Industrial, ADR........ 6,000 76,500
______
117,800
______
Hong Kong-3.5% Dah Sing Financial..................... 15,000 60,333
HSBC Holdings.......................... 4,488 93,452
Harbour Centre Development............. 132,000 192,913
Yue Yuen Industrial.................... 344,000 115,675
______
462,373
______
Hungary-1.1% Pick Szeged, ADR....................... 2,800 (a,b) 140,000
______
India-2.8% Reliance Industries, GDR............... 12,000 138,360
State Bank of India, GDR............... 8,300 (b) 135,124
Steel Authority, GDR................... 12,000 (b) 102,000
______
375,484
______
Indonesia-2.9% PT Bank Bali........................... 106,000 246,354
PT Indosat, ADR........................ 3,400 93,925
PT Sari Husada......................... 10,000 46,908
______
387,187
______
Israel-1.3% Super sol.............................. 7,050 172,511
______
Luxembourg-1.3% Espirito Santo Financial, ADR.......... 13,500 177,188
______
Malaysia-10.8% AMMB Holdings Berhad................... 28,000 222,715
Affin Holdings Berhad.................. 50,000 146,419
IOI Properties Berhad.................. 60,000 197,072
Leader Universal Holdings Berhad....... 57,000 128,571
MBF Capital Berhad..................... 80,000 125,366
Malayawata Steel Berhad................ 60,000 117,293
DREYFUS EMERGING MARKETS FUND
STATEMENT OF INVESTMENTS (CONTINUED) NOVEMBER 30, 1996 (UNAUDITED)
Common Stocks (continued) Shares Value
______ ______
Malaysia (continued) Pacific & Orient Berhad................ 50,000 $ 127,622
Perusahaan Otomobil Nasional Berhad.... 25,600 162,089
Petronas Dagangan Berhad............... 43,000 114,009
United Engineers....................... 10,000 90,621
______
1,431,777
______
Mexico-10.8% ALFA................................... 43,100 192,618
ARA.................................... 65,000 (a) 145,040
Controladora Comercial Mexicana, ADR... 9,500 171,594
Empaques Ponderosa..................... 294,000 152,824
Grupo Financiero Inbursa............... 59,700 189,980
Tablex................................. 31,000 80,570
Telefonos de Mexico, Series L, ADR..... 6,800 206,550
Transportacion Maritima, ADR........... 29,000 199,375
Tubes de Acero de Mexico, ADR.......... 6,700 (a) 91,288
______
1,429,839
______
Peru-2.3% Telefonica del Peru, ADR............... 16,000 310,000
______
Philippines-5.0% Empire East Land Holdings.............. 225,000 (a) 109,161
First Philippine Holdings.............. 45,000 95,034
Philippine Long Distance Telephone..... 3,500 201,250
Philippine National Bank............... 12,000 (a) 150,045
Universal Robina....................... 230,000 113,775
______
669,265
______
Portugal-3.0% Banco Comercial Portugues, ADR......... 10,000 132,500
Cimpor-Cimentos de Portugal............ 5,500 114,923
Portugal Telecom, ADR.................. 5,800 153,700
______
401,123
______
Singapore-5.1% Development Bank of Singapore.......... 18,000 232,300
Far East Levingston Shipbuilding....... 45,000 239,037
Singapore Airlines..................... 20,000 204,235
______
675,572
______
South Africa-4.6% Barlow, ADR............................ 11,000 99,688
Barlow................................. 11,800 108,273
Malbak................................. 32,000 151,697
Polifin................................ 80,000 137,093
Sasol.................................. 9,000 111,279
______
608,030
______
South Korea-5.5% Kookmin Bank, GDR...................... 6,500 (a,b) 119,860
Korea Electric Power................... 5,000 160,024
Korea Mobile Telecommunications........ 17,400 226,200
Pohang Iron & Steel, ADR............... 11,000 221,375
______
727,459
______
Thailand-2.7% Bangkok Bank Public.................... 16,500 188,645
DREYFUS EMERGING MARKETS FUND
STATEMENT OF INVESTMENTS (CONTINUED) NOVEMBER 30, 1996 (UNAUDITED)
Common Stocks (continued) Shares Value
______ ______
Thailand (continued) Srithai Superware...................... 36,000 $ 176,194
______
364,839
______
TOTAL COMMON STOCKS
(cost $10,848,472)................... $10,672,933
======
Preferred Stocks-7.2%
Brazil: Banco Itau............................. 500 $ 197,483
Brasmotor.............................. 700 197,193
Companhia Cimento Portland Itau........ 600 175,992
Ericsson Telecomunicacoes.............. 11,800 183,911
Petroleo Brasileiro.................... 1,500 204,758
______
TOTAL PREFERRED STOCKS
(cost $978,146)...................... $ 959,337
======
Principal
Short-Term Investments-18.2% Amount
______
U.S. Treasury Bills: 5%, 12/5/96............................ $ 141,000 $ 140,902
5.02%, 12/12/96........................ 386,000 385,348
5.13%, 12/19/96........................ 562,000 560,477
4.92%, 1/2/97.......................... 92,000 91,587
4.98%, 1/16/97......................... 212,000 210,633
5.12%, 1/23/97......................... 187,000 185,614
4.98%, 2/27/97......................... 856,000 845,651
______
TOTAL SHORT-TERM INVESTMENTS
(cost $2,420,359).................... $ 2,420,212
======
TOTAL INVESTMENTS (cost $14,246,977)........................................ 105.8% $14,052,482
==== ======
LIABILITIES, LESS CASH AND RECEIVABLES...................................... (5.8%) $ (764,412)
==== ======
NET ASSETS.................................................................. 100.0% $13,288,070
==== ======
Notes to Statement of Investments:
(a) Non-income producing.
(b) Securities exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers. At
November 30, 1996, these securities amounted to $496,984 or approximately
3.7% of net assets.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS EMERGING MARKETS FUND
STATEMENT OF ASSETS AND LIABILITIES NOVEMBER 30, 1996 (UNAUDITED)
Cost Value
______ ______
<S> <C> <C> <C>
ASSETS: Investments in securities-See Statement of Investments $14,246,977 $14,052,482
Cash....................................... 77,175
Cash denominated in foreign currencies..... 365,118 364,133
Dividends receivable....................... 13,530
Receivable for subscriptions to Common Stock 12,000
Prepaid expenses........................... 5,064
Due from The Dreyfus Corporation and affiliates 2,514
______
14,526,898
______
LIABILITIES: Due to Distributor......................... 8,139
Net unrealized (depreciation) on forward
....... currency exchange contracts-Note 3(a) 683
Payable for investment securities purchased 1,201,433
Accrued expenses........................... 28,573
______
1,238,828
______
NET ASSETS.................................................................. $13,288,070
======
REPRESENTED BY: Paid-in capital............................ $13,383,789
Accumulated undistributed investment income-net4,959
Accumulated net realized gain (loss) on investments 94,741
Accumulated net unrealized appreciation (depreciation)
on investments and foreign currency transactions (195,419)
______
NET ASSETS.................................................................. $13,288,070
======
SHARES OUTSTANDING
(100 million shares of $.001 par value Common Stock authorized)............. 1,086,938
NET ASSET VALUE per share................................................... $12.23
======
See notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS EMERGING MARKETS FUND
STATEMENT OF OPERATIONS
FROM JUNE 28, 1996 (COMMENCEMENT OF OPERATIONS) TO NOVEMBER 30, 1996
(UNAUDITED)
INVESTMENT INCOME
<S> <C> <C> <C>
INCOME: Cash dividends
(net of $3,506 foreign taxes withheld at source) $ 36,252
Interest................................... 33,822
_____
Total Income......................... $ 70,074
EXPENSES: Management fee-Note 2(a)................... 40,697
Custodian fees............................. 15,656
Legal fees................................. 14,648
Shareholder servicing costs-Note 2(b)...... 10,722
Audit fees................................. 10,359
Registration fees.......................... 7,337
Directors' fees and expenses-Note 2(c)..... 5,966
Prospectus and shareholders' reports....... 1,560
Miscellaneous.............................. 927
_____
Total Expenses....................... 107,872
Less-expense reimbursement from the Manager due to
undertaking-Note 2(a).................. (42,757)
_____
Net Expenses......................... 65,115
_____
INVESTMENT INCOME-NET....................................................... 4,959
_____
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS-Note 3:
Net realized gain (loss) on investments and
foreign currency transactions.......... $105,559
Net realized gain (loss) on forward currency
exchange contracts..................... (10,818)
_____
Net Realized Gain (Loss)............... 94,741
Net unrealized appreciation (depreciation) on investments
and foreign currency transactions...... (195,419)
_____
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS...................... (100,678)
_____
NET (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS...................... $ (95,719)
=====
See notes to financial statements.
DREYFUS EMERGING MARKETS FUND
STATEMENT OF CHANGES IN NET ASSETS
FROM JUNE 28, 1996 (COMMENCEMENT OF OPERATIONS) TO NOVEMBER 30, 1996 (UNAUDITE
D)
OPERATIONS:
Investment income-net................................................................... $ 4,959
Net realized gain (loss) on investments................................................. 94,741
Net unrealized appreciation (depreciation) on investments............................... (195,419)
______
Net Increase (Decrease) in Net Assets Resulting from Operations....................... (95,719)
______
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold........................................................... 13,526,522
Cost of shares redeemed................................................................. (142,733)
______
Increase (Decrease) in Net Assets from Capital Stock Transactions..................... 13,383,789
______
Total Increase (Decrease) in Net Assets............................................. 13,288,070
NET ASSETS:
Beginning of Period..................................................................... -
______
End of Period........................................................................... $13,288,070
======
Undistributed investment income-net....................................................... $ 4,959
______
Shares
______
CAPITAL SHARE TRANSACTIONS:
Shares sold............................................................................. 1,098,719
Shares redeemed......................................................................... (11,781)
______
Net Increase (Decrease) in Shares Outstanding......................................... 1,086,938
======
See notes to financial statements.
DREYFUS EMERGING MARKETS FUND
FINANCIAL HIGHLIGHTS (UNAUDITED)
Contained below is per share operating performance data for a share of
Common Stock outstanding, total investment return, ratios to average net
assets and other supplemental data for the period June 28, 1996 (commencement
of operations) to November 30, 1996. This information has been derived from
the Fund's financial statements.
PER SHARE DATA:
Net asset value, beginning of period.................................................... $12.50
____
Investment Operations:
Investment income-net................................................................... -
Net realized and unrealized gain (loss)
on investments........................................................................ (.27)
____
Total from Investment Operations........................................................ (.27)
____
Net asset value, end of period.......................................................... $12.23
====
TOTAL INVESTMENT RETURN..................................................................... (2.16%)(1)(2)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets................................................. .85%(2)
Ratio of net investment income
to average net assets................................................................. .07%(2)
Decrease reflected in above expense ratio
due to undertaking by the Manager..................................................... .56%(2)
Portfolio Turnover Rate................................................................. 19.86%(2)
Average commission rate paid (3)........................................................ $.0212
Net Assets, end of period (000's Omitted)............................................... $13,288
(1) Exclusive of redemption fee.
(2) Not annualized.
(3) The Fund is required to disclose its average commission rate paid per share for purchases and sales of investment
securities.
See notes to financial statements.
</TABLE>
DREYFUS EMERGING MARKETS FUND
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
Dreyfus International Funds, Inc. (the "Company") is registered under the
Investment Company Act of 1940 ("Act") as a non-diversified open-end
management investment company and operates as a series company currently
offering two series, including the Dreyfus Emerging Markets Fund (the "Fund")
which commenced operations on June 28, 1996. The Fund's investment objective
is long-term capital appreciation. The Dreyfus Corporation ("Manager") serves
as the Fund's investment adviser. The Manager is a direct subsidiary of
Mellon Bank, N.A., which is a wholly-owned subsidiary of Mellon Bank
Corporation. Premier Mutual Fund Services, Inc. (the "Distributor") acts as
the distributor of the Fund's shares, which are sold to the public without a
sales charge. The Fund's fiscal year end is May 31.
As of November 30, 1996, APT Holdings Corporation, an indirect subsidiary
of Mellon Bank Corporation, held 400,000 shares of the Fund.
The Company accounts separately for the assets, liabilities and
operations of each fund. Expenses directly attributable to each fund are
charged to that fund's operations; expenses which are applicable to all funds
are allocated among them on a pro rata basis.
The Fund's financial statements are prepared in accordance with generally
accepted accounting principles which may require the use of management
estimates and assumptions. Actual results could differ from those estimates.
(A) PORTFOLIO VALUATION: The Fund's investments in securities (including
options and financial futures) are valued at the last sales price on the
securities exchange on which such securities are primarily traded or at the
last sales price on the national securities market. Securities not listed on
an exchange or the national securities market, or securities for which there
were no transactions, are valued at the average of the most recent bid and
asked prices, except for open short positions, where the asked price is used
for valuation purposes. Bid price is used when no asked price is available.
Investments denominated in foreign currencies are translated to U.S. dollars
at the prevailing rates of exchange. Forward currency exchange contracts are
valued at the forward rate.
(B) FOREIGN CURRENCY TRANSACTIONS: The Fund does not isolate that portion
of the results of operations resulting from changes in foreign exchange rates
on investments from the fluctuations arising from changes in the market
prices of securities held. Such fluctuations are included with the net
realized and unrealized gain or loss from investments.
Net realized foreign exchange gains or losses arise from sales and
maturities of short-term securities, sales of foreign currencies, currency
gains or losses realized on securities transactions, the difference between
the amount of dividends, interest and foreign withholding taxes recorded on
the Fund's books, and the U.S. dollar equivalent of the amounts actually
received or paid. Net unrealized foreign exchange gains and losses arise from
changes in the value of assets and liabilities other than investments in
securities, resulting from changes in exchange rates. Such gains and losses
are included with net realized and unrealized gain or loss on investments.
(C) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities
transactions are recorded on a trade date basis. Realized gain and loss from
securities transactions are recorded on the identified cost basis. Dividend
income is recognized on the ex-dividend date and interest income, including,
where applicable, amortization of discount on investments, is recognized on
the accrual basis.
(D) DIVIDENDS TO SHAREHOLDERS: Dividends are recorded on the ex-dividend
date. Dividends from investment income-net and dividends from net realized
capital gain are normally declared and paid annually, but the Fund may make
distributions on a more frequent basis to comply with the distribution
requirements of the Internal Revenue Code. To the extent that net realized
capital gain can be offset by capital loss carryovers, if any, it is the
policy
DREYFUS EMERGING MARKETS FUND
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
of the Fund not to distribute such gain.
(E) FEDERAL INCOME TAXES: It is the policy of the Fund to qualify as a
regulated investment company, if such qualification is in the best interests
of its shareholders, by complying with the applicable provisions of the
Internal Revenue Code, and to make distributions of taxable income sufficient
to relieve it from substantially all Federal income and excise taxes.
NOTE 2-MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement ("Agreement") with the Manager,
the management fee is computed at the annual rate of 1.25% of the value of
the Fund's average daily net assets and is payable monthly. The Manager has
undertaken from June 28, 1996 through May 31, 1997 to reduce the management
fee paid by or reimburse such excess expenses of the Fund, to the extent that
the Fund's aggregate annual expenses, exclusive of taxes, brokerage, interest
on borrowings and extraordinary expenses, exceed an annual rate of 2% of the
value of the Fund's average daily net assets. The expense reimbursement,
pursuant to the undertaking, amounted to $42,757 during the period ended
November 30, 1996.
(B) Under the Shareholder Services Plan, the Fund pays the Distributor at
an annual rate of .25 of 1% of the value of the Fund's average daily net
assets for the provision of certain services. The services provided may
include personal services relating to shareholder accounts, such as answering
shareholder inquiries regarding the Fund and providing reports and other
information, and services related to the maintenance of shareholder accounts.
The Distributor may make payments to Service Agents (a securities dealer,
financial institution or other industry professional) in respect of these
services. The Distributor determines the amounts to be paid to Service
Agents. During the period ended November 30, 1996, the Fund was charged an
aggregate of $8,139 pursuant to the Shareholder Services Plan.
The Fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of
the Manager, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency services for the Fund. Such
compensation amounted to $938 during the period ended November 30, 1996.
(C) Each director who is not an "affiliated person" as defined in the Act
receives from the Company an annual fee of $2,500 and an attendance fee of
$500 per meeting. The Chairman of the Board receives an additional 25% of
such compensation.
NOTE 3-SECURITIES TRANSACTIONS:
(A) The aggregate amount of purchases and sales of investment securities,
excluding short-term securities and forward currency exchange contracts,
during the period ended November 30, 1996 amounted to $12,927,164 and
$1,201,667, respectively.
In addition, the following summarizes open forward currency exchange
contracts at November 30, 1996:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Foreign
Currency Unrealized
Forward Currency Buy Contracts Amounts Cost Value (Depreciation)
_______________ _____ _____ _____ _______
Malaysian Ringgit, expiring 12/6/96..... 300,723 $119,065 $119,004 $ (61)
Philippines Peso, expiring 12/2/96...... 708,935 27,048 26,976 (72)
Philippines Peso, expiring 12/3/96...... 827,925 31,588 31,504 (84)
South African Rand, expiring 12/6/96.... 158,790 34,910 34,444 (466)
___
$(683)
===
</TABLE>
DREYFUS EMERGING MARKETS FUND
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
The Fund enters into forward currency exchange contracts in order to
hedge its exposure to changes in foreign currency exchange rates on its
foreign portfolio holdings. When executing forward currency exchange
contracts, the Fund is obligated to buy or sell a foreign currency at a
specified rate on a certain date in the future. With respect to sales of
forward currency exchange contracts, the Fund would incur a loss if the value
of the contract increases between the date the forward contract is opened and
the date the forward contract is closed. The Fund realizes a gain if the
value of the contract decreases between those dates. With respect to
purchases of forward currency exchange contracts, the Fund would incur a loss
if the value of the contract decreases between the date the forward contract
is opened and the date the forward contract is closed. The Fund realizes a
gain if the value of the contract increases between those dates. The Fund is
also exposed to credit risk associated with counter party nonperformance on
these forward currency exchange contracts which is typically limited to the
unrealized gains on such contracts that are recognized in the Statement of
Assets and Liabilities.
(B) At November 30, 1996, accumulated net unrealized depreciation on
investments and forward currency exchange contracts was $195,178, consisting
of $400,877 gross unrealized appreciation and $596,055 gross unrealized
depreciation.
At November 30, 1996, the cost of investments for Federal income tax
purposes was substantially the same as the cost for financial reporting
purposes (see the Statement of Investments).
[Dreyfus lion "d" logo]
DREYFUS EMERGING MARKETS FUND
200 Park Avenue
New York, NY 10166
INVESTMENT ADVISER
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
CUSTODIAN
The Bank of New York
90 Washington Street
New York, NY 10286
TRANSFER AGENT &
DIVIDEND DISBURSING AGENT
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Printed in U.S.A. 327SA9611
[Dreyfus logo]
Emerging Markets
Fund
Semi-Annual
Report
November 30, 1996
DREYFUS INTERNATIONAL FUNDS, INC.
PART C. OTHER INFORMATION
_________________________
Item 24. Financial Statements and Exhibits. - List
_______ _________________________________________
(a) Financial Statements:
Included in Part A of the Registration Statement with
respect to Dreyfus Emerging Markets Fund:
Condensed Financial Information for the period from June 28,
1996 (commencement of operations) to November 30,1996
(unaudited).
Included in Part B of the Registration Statement:
Statement of Investments--May 31, 1996 (audited) and
November 30, 1996 (unaudited) for Dreyfus International
Growth Fund; and November 30, 1996 (unaudited) for
Dreyfus Emerging Markets Fund.
Statement of Assets and Liabilities--May 31, 1996
(audited) and November 30, 1996 (unaudited) for Dreyfus
International Growth Fund; and November 30, 1996
(unaudited) for Dreyfus Emerging Markets Fund.
Statement of Operations--year ended May 31, 1996
(audited) and for the six months ended November 30,
1996, (unaudited) for Dreyfus International Growth
Fund; and for the period from June 28, 1996
(commencement of operations) to November 30, 1996
(unaudited) for Dreyfus Emerging Markets Fund.
Statement of Changes in Net Assets--for each of the two
years in the period ended May 31, 1996 (audited) and
for the six months ended November 30, 1996, (unaudited)
for Dreyfus International Growth Fund; and for the
period from June 28, 1996 (commencement of operations)
to November 30, 1996 (unaudited) for Dreyfus Emerging
Markets Fund.
Notes to Financial Statements
Report of Ernst & Young LLP, Independent Auditors,
dated July 8, 1996 for Dreyfus International Growth
Fund
All Schedules and other financial statement information, for which
provision is made in the applicable accounting regulations of the
Securities and Exchange Commission, are either omitted because they are not
required under the related instructions, they are inapplicable, or the
required information is presented in the financial statements or notes
thereto which are included in Part B of the Registration Statement.
Item 24. Financial Statements and Exhibits. - List (continued)
_______ _____________________________________________________
(b) Exhibits:
(1)(a) Registrant's Articles of Incorporation and Articles of Amendment
are incorporated by reference to Exhibit (1) of Post-Effective
Amendment No. 5 to the Registration Statement on Form N-1A, filed
on September 28, 1995.
(1)(b) Articles of Amendment and Articles Supplementary are incorporated
by reference to Exhibit (1)(b) of Post-Effective Amendment No. 8
to the Registration Statement on Form N-1A, filed on September
26, 1996.
(2) Registrant's By-Laws, as amended, are incorporated by reference
to Exhibit (2) of Post-Effective Amendment No. 8 to the
Registration Statement on Form N-1A, filed on September 26, 1996.
(4) Specimen certificate for the Registrant's securities is
incorporated by reference to Exhibit (4) of Pre-Effective
Amendment No. 2 to the Registration Statement on Form N-1A, filed
on June 28, 1993.
(5) Management Agreement is incorporated by reference to Exhibit
(5)(a) of Post-Effective Amendment No. 7 to the Registration
Statement on Form N-1A, filed on February 2, 1996.
(6)(a) Distribution Agreement is incorporated by reference to Exhibit
(6)(a) of Post-Effective Amendment No. 5 to the Registration
Statement on Form N-1A, filed on September 28, 1995.
(6)(b) Forms of Service Agreements are incorporated by reference to
Exhibit (6)(b) of Post-Effective Amendment No. 5 to the
Registration Statement on Form N-1A, filed on September 28, 1995.
(8) Custody Agreement is incorporated by reference to Exhibit 8 of
Post-Effective Amendment No. 5 to the Registration Statement on
Form N-1A, filed on September 28, 1995.
(9) Shareholder Services Plan is incorporated by reference to Exhibit
(9) of Post-Effective Amendment No. 8 to the Registration
Statement on Form N-1A, filed on September 26, 1996.
(10) Opinion and consent of Registrant's counsel is incorporated by
reference to Exhibit (10) of Post-Effective Amendment No. 5 to
the Registration Statement on Form N-1A, filed on September 28,
1995.
(11) Consent of Independent Auditors.
(14) Model Retirement Plans are incorporated by reference to Exhibit
(14) of Post-Effective Amendment No. 8 to the Registration
Statement on Form N-1A, filed on September 26, 1996.
(15) Distribution Plan is incorporated by reference to Exhibit (15) of
Post-Effective Amendment No. 5 to the Registration Statement on
Form N-1A, filed on September 28, 1995.
(16) Schedules of Computation of Performance Data are incorporated by
reference to Post-Effective Amendment No. 1 to the Registration
Statement on Form N-1A, filed on December 27, 1993.
(17) Financial Data Schedule.
Other Exhibits
______________
(a) Powers of Attorney of the Board members and officers.
(b) Certificate of Secretary.
Item 25. Persons Controlled by or under Common Control with Registrant.
_______ ______________________________________________________________
Not Applicable
Item 26. Number of Holders of Securities.
_______ ________________________________
(1) (2)
Number of Record
Title of Class Holders as of December 10, 1996
______________ ________________________________
Common Stock
(Par value $.001)
Dreyfus International Growth Fund 8,137
Dreyfus Emerging Markets Fund 324
Item 27. Indemnification
_______ _______________
Reference is made to Article SEVENTH of the Registrant's Articles
of Incorporation filed as Exhibit 1 of Post-Effective Amendment
No. 5 to the Registration Statement on Form N-1A, filed on
September 28, 1995 and to Section 2-418 of the Maryland General
Corporation Law. The application of these provisions is limited
by Article VIII of the Registrant's By-Laws filed as Exhibit 2
hereto and by the following undertaking set forth in the rules
promulgated by the Securities and Exchange Commission:
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers
and controlling persons of the registrant pursuant to the
foregoing provisions, or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in such Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the
registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or
controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as
expressed in such Act and will be governed by the final
adjudication of such issue.
Reference is also made to the Distribution Agreement filed as
Exhibit (6)(a) to Post-Effective Amendment No. 5 to the
Registration Statement on Form N-1A, filed on September 28, 1995.
Item 28. Business and Other Connections of Investment Adviser.
_______ ____________________________________________________
The Dreyfus Corporation ("Dreyfus") and subsidiary companies
comprise a financial service organization whose business
consists primarily of providing investment management services
as the investment adviser and manager for sponsored investment
companies registered under the Investment Company Act of 1940
and as an investment adviser to institutional and individual
accounts. Dreyfus also serves as sub-investment adviser to
and/or administrator of other investment companies. Dreyfus
Service Corporation, a wholly-owned subsidiary of Dreyfus, is a
registered broker-dealer. Dreyfus Management, Inc., another
wholly-owned subsidiary, provides investment management
services to various pension plans, institutions and
individuals.
Item 28. Business and Other Connections of Investment Adviser (continued)
________ ________________________________________________________________
Officers and Directors of Investment Adviser
____________________________________________
Name and Position
with Dreyfus Other Businesses
_________________ ________________
MANDELL L. BERMAN Real estate consultant and private investor
Director 29100 Northwestern Highway, Suite 370
Southfield, Michigan 48034;
Past Chairman of the Board of Trustees:
Skillman Foundation;
Member of The Board of Vintners Intl.
FRANK V. CAHOUET Chairman of the Board, President and
Director Chief Executive Officer:
Mellon Bank Corporation****;
Mellon Bank, N.A.****
Director:
Avery Dennison Corporation
150 North Orange Grove Boulevard
Pasadena, California 91103;
Saint-Gobain Corporation
750 East Swedesford Road
Valley Forge, Pennsylvania 19482;
Teledyne, Inc.
1901 Avenue of the Stars
Los Angeles, California 90067
ALVIN E. FRIEDMAN Senior Adviser to Dillon, Read & Co. Inc.
Director 535 Madison Avenue
New York, New York 10022;
Director and Member of the Executive
Committee of Avnet, Inc.**
LAWRENCE M. GREENE None
Director
JULIAN M. SMERLING None
Director
W. KEITH SMITH Chairman and Chief Executive Officer:
Chairman of the Board The Boston Company*****;
Vice Chairman of the Board:
Mellon Bank Corporation****;
Mellon Bank, N.A.****;
Director:
Dentsply International, Inc.
570 West College Avenue
York, Pennsylvania 17405
CHRISTOPHER M. CONDRON Vice Chairman:
President, Chief Mellon Bank Corporation****;
Executive Officer, The Boston Company*****;
Chief Operating Deputy Director:
Officer and a Mellon Trust****;
Director Chief Executive Officer:
The Boston Company Asset Management,
Inc.*****;
President:
Boston Safe Deposit and Trust
Company*****
STEPHEN E. CANTER Director:
Vice Chairman and The Dreyfus Trust Company++;
Chief Investment Officer, Formerly, Chairman and Chief Executive
and a Director Officer:
Kleinwort Benson Investment Management
Americas Inc.*
LAWRENCE S. KASH Chairman, President and Chief
Vice Chairman-Distribution Executive Officer:
and a Director The Boston Company Advisors, Inc.
53 State Street
Exchange Place
Boston, Massachusetts 02109
Executive Vice President and Director:
Dreyfus Service Organization, Inc.***;
Director:
Dreyfus America Fund
The Dreyfus Consumer Credit
Corporation*;
The Dreyfus Trust Company++;
Dreyfus Service Corporation*;
President:
The Boston Company*****;
Laurel Capital Advisors****;
Boston Group Holdings, Inc.;
Executive Vice President:
Mellon Bank, N.A.****;
Boston Safe Deposit and Trust
Company*****;
PHILIP L. TOIA Chairman of the Board and Trust Investment
Vice Chairman-Operations Officer:
and Administration The Dreyfus Trust Company++;
and a Director Chairman of the Board and Chief Operating
Officer:
Major Trading Corporation*;
Chairman and Director:
Dreyfus Transfer, Inc.
One American Express Plaza
Providence, Rhode Island 02903
Director:
Dreyfus Precious Metals, Inc.*;
Dreyfus Service Corporation*;
Seven Six Seven Agency, Inc.*;
President and Director:
Dreyfus Acquisition Corporation*;
The Dreyfus Consumer Credit
Corporation*;
Dreyfus-Lincoln, Inc.*;
Dreyfus Management, Inc.*;
Dreyfus Personal Management, Inc.*;
Dreyfus Partnership Management, Inc.+;
Dreyfus Service Organization, Inc.***;
The Truepenny Corporation*;
Formerly, Senior Vice President:
The Chase Manhattan Bank, N.A. and
The Chase Manhattan Capital Markets
Corporation
One Chase Manhattan Plaza
New York, New York 10081
WILLIAM T. SANDALLS, JR. Director:
Senior Vice President and Dreyfus Partnership Management, Inc.*;
Chief Financial Officer Seven Six Seven Agency, Inc.*;
President and Director:
Lion Management, Inc.*;
Executive Vice President and Director:
Dreyfus Service Organization, Inc.*;
Vice President, Chief Financial Officer and
Director:
Dreyfus Acquisition Corporation*;
Dreyfus America Fund
Vice President and Director:
The Dreyfus Consumer Credit
Corporation*;
The Truepenny Corporation*;
Treasurer, Financial Officer and Director:
The Dreyfus Trust Company++;
Treasurer and Director:
Dreyfus Management, Inc.*;
Dreyfus Personal Management, Inc.*;
Dreyfus Service Corporation*;
Major Trading Corporation*;
Formerly, President and Director:
Sandalls & Co., Inc.
WILLIAM F. GLAVIN, JR. Executive Vice President:
Vice President-Corporate Dreyfus Service Corporation*;
Development Senior Vice President:
The Boston Company Advisors, Inc.
53 State Street
Exchange Place
Boston, Massachusetts 02109
MARK N. JACOBS Vice President, Secretary and Director:
Vice President, Lion Management, Inc.*;
General Counsel Secretary:
and Secretary The Dreyfus Consumer Credit
Corporation*;
Dreyfus Management, Inc.*;
Assistant Secretary:
Dreyfus Service Organization, Inc.***;
Major Trading Corporation*;
The Truepenny Corporation*
PATRICE M. KOZLOWSKI None
Vice President-
Corporate Communications
MARY BETH LEIBIG None
Vice President-
Human Resources
JEFFREY N. NACHMAN President and Director:
Vice President-Mutual Fund Dreyfus Transfer, Inc.
Accounting One American Express Plaza
Providence, Rhode Island 02903
ANDREW S. WASSER Vice President:
Vice President-Information Mellon Bank Corporation****
Services
ELVIRA OSLAPAS Assistant Secretary:
Assistant Secretary Dreyfus Service Corporation*;
Dreyfus Management, Inc.*;
Dreyfus Acquisition Corporation, Inc.*;
The Truepenny Corporation+
______________________________________
* The address of the business so indicated is 200 Park Avenue, New
York, New York 10166.
** The address of the business so indicated is 80 Cutter Mill Road,
Great Neck, New York 11021.
*** The address of the business so indicated is 131 Second Street,
Lewes, Delaware 19958.
**** The address of the business so indicated is One Mellon Bank Center,
Pittsburgh, Pennsylvania 15258.
***** The address of the business so indicated is One Boston Place,
Boston, Massachusetts 02108.
+ The address of the business so indicated is Atrium Building,
80 Route 4 East, Paramus, New Jersey 07652.
++ The address of the business so indicated is 144 Glenn Curtiss
Boulevard, Uniondale, New York 11556-0144.
Item 29. Principal Underwriters
________ ______________________
(a) Other investment companies for which Registrant's principal
underwriter (exclusive distributor) acts as principal underwriter or
exclusive distributor:
1) Comstock Partners Funds, Inc.
2) Dreyfus A Bonds Plus, Inc.
3) Dreyfus Appreciation Fund, Inc.
4) Dreyfus Asset Allocation Fund, Inc.
5) Dreyfus Balanced Fund, Inc.
6) Dreyfus BASIC GNMA Fund
7) Dreyfus BASIC Money Market Fund, Inc.
8) Dreyfus BASIC Municipal Fund, Inc.
9) Dreyfus BASIC U.S. Government Money Market Fund
10) Dreyfus California Intermediate Municipal Bond Fund
11) Dreyfus California Tax Exempt Bond Fund, Inc.
12) Dreyfus California Tax Exempt Money Market Fund
13) Dreyfus Cash Management
14) Dreyfus Cash Management Plus, Inc.
15) Dreyfus Connecticut Intermediate Municipal Bond Fund
16) Dreyfus Connecticut Municipal Money Market Fund, Inc.
17) Dreyfus Florida Intermediate Municipal Bond Fund
18) Dreyfus Florida Municipal Money Market Fund
19) The Dreyfus Fund Incorporated
20) Dreyfus Global Bond Fund, Inc.
21) Dreyfus Global Growth Fund
22) Dreyfus GNMA Fund, Inc.
23) Dreyfus Government Cash Management
24) Dreyfus Growth and Income Fund, Inc.
25) Dreyfus Growth and Value Funds, Inc.
26) Dreyfus Growth Opportunity Fund, Inc.
27) Dreyfus Income Funds
28) Dreyfus Institutional Money Market Fund
29) Dreyfus Institutional Short Term Treasury Fund
30) Dreyfus Insured Municipal Bond Fund, Inc.
31) Dreyfus Intermediate Municipal Bond Fund, Inc.
32) Dreyfus International Funds, Inc.
33) Dreyfus Investment Grade Bond Funds, Inc.
34) The Dreyfus/Laurel Funds, Inc.
35) The Dreyfus/Laurel Funds Trust
36) The Dreyfus/Laurel Tax-Free Municipal Funds
37) Dreyfus LifeTime Portfolios, Inc.
38) Dreyfus Liquid Assets, Inc.
39) Dreyfus Massachusetts Intermediate Municipal Bond Fund
40) Dreyfus Massachusetts Municipal Money Market Fund
41) Dreyfus Massachusetts Tax Exempt Bond Fund
42) Dreyfus MidCap Index Fund
43) Dreyfus Money Market Instruments, Inc.
44) Dreyfus Municipal Bond Fund, Inc.
45) Dreyfus Municipal Cash Management Plus
46) Dreyfus Municipal Money Market Fund, Inc.
47) Dreyfus New Jersey Intermediate Municipal Bond Fund
48) Dreyfus New Jersey Municipal Bond Fund, Inc.
49) Dreyfus New Jersey Municipal Money Market Fund, Inc.
50) Dreyfus New Leaders Fund, Inc.
51) Dreyfus New York Insured Tax Exempt Bond Fund
52) Dreyfus New York Municipal Cash Management
53) Dreyfus New York Tax Exempt Bond Fund, Inc.
54) Dreyfus New York Tax Exempt Intermediate Bond Fund
55) Dreyfus New York Tax Exempt Money Market Fund
56) Dreyfus 100% U.S. Treasury Intermediate Term Fund
57) Dreyfus 100% U.S. Treasury Long Term Fund
58) Dreyfus 100% U.S. Treasury Money Market Fund
59) Dreyfus 100% U.S. Treasury Short Term Fund
60) Dreyfus Pennsylvania Intermediate Municipal Bond Fund
61) Dreyfus Pennsylvania Municipal Money Market Fund
62) Dreyfus S&P 500 Index Fund
63) Dreyfus Short-Intermediate Government Fund
64) Dreyfus Short-Intermediate Municipal Bond Fund
65) The Dreyfus Socially Responsible Growth Fund, Inc.
66) Dreyfus Stock Index Fund, Inc.
67) Dreyfus Tax Exempt Cash Management
68) The Dreyfus Third Century Fund, Inc.
69) Dreyfus Treasury Cash Management
70) Dreyfus Treasury Prime Cash Management
71) Dreyfus Variable Investment Fund
72) Dreyfus Worldwide Dollar Money Market Fund, Inc.
73) General California Municipal Bond Fund, Inc.
74) General California Municipal Money Market Fund
75) General Government Securities Money Market Fund, Inc.
76) General Money Market Fund, Inc.
77) General Municipal Bond Fund, Inc.
78) General Municipal Money Market Fund, Inc.
79) General New York Municipal Bond Fund, Inc.
80) General New York Municipal Money Market Fund
81) Premier Insured Municipal Bond Fund
82) Premier California Municipal Bond Fund
83) Premier Equity Funds, Inc.
84) Premier Global Investing, Inc.
85) Premier GNMA Fund
86) Premier Growth Fund, Inc.
87) Premier Municipal Bond Fund
88) Premier New York Municipal Bond Fund
89) Premier State Municipal Bond Fund
90) Premier Strategic Growth Fund
91) Premier Value Fund
(b)
Positions and
Name and principal Positions and offices with offices with
business address the Distributor Registrant
__________________ ___________________________ _____________
Marie E. Connolly+ Director, President, Chief President and
Executive Officer and Compliance Treasurer
Officer
Joseph F. Tower, III+ Senior Vice President, Treasurer Vice President
and Chief Financial Officer and Assistant
Treasurer
John E. Pelletier+ Senior Vice President, General Vice President
Counsel, Secretary and Clerk and Secretary
Roy M. Moura+ First Vice President None
Dale F. Lampe+ Vice President None
Mary A. Nelson+ Vice President Vice President
and Assistant
Treasurer
Paul Prescott+ Vice President None
Elizabeth A. Bachman++ Assistant Vice President Vice President
and Assistant
Secretary
Jean M. O'Leary+ Assistant Secretary and None
Assistant Clerk
John W. Gomez+ Director None
William J. Nutt+ Director None
________________________________
+ Principal business address is One Exchange Place, Boston, Massachusetts
02109.
++ Principal business address is 200 Park Avenue, New York, New York 10166.
Item 30. Location of Accounts and Records
________________________________
1. First Data Investor Services Group, Inc.,
a subsidiary of First Data Corporation
P.O. Box 9671
Providence, Rhode Island 02940-9671
2. The Bank of New York
90 Washington Street
New York, New York 10286
3. Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, Rhode Island 02940-9671
4. The Dreyfus Corporation
200 Park Avenue
New York, New York 10166
Item 31. Management Services
_______ ___________________
Not Applicable
Item 32. Undertakings
________ ____________
(1) To call a meeting of shareholders for the purpose of voting upon
the question of removal of a Board member or Board members when
requested in writing to do so by the holders of at least 10% of
the Registrant's outstanding shares and in connection with such
meeting to comply with the provisions of Section 16(c) of the
Investment Company Act of 1940 relating to shareholder
communications.
(2) To furnish each person to whom a prospectus is delivered with a
copy of the Fund's latest Annual Report to Shareholders, upon
request and without charge.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets all
of the requirements for effectiveness of this Amendment to the Registration
Statement pursuant to Rule 485(b) under the Securities Act of 1933 and has
duly caused this Amendment to the Registration Statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City of
New York, and State of New York on the 24th day of December, 1996.
DREYFUS INTERNATIONAL FUNDS, INC.
BY: /s/ Marie E. Connolly
__________________________________________
MARIE E. CONNOLLY, PRESIDENT
Pursuant to the requirements of the Securities Act of 1933, this
Amendment to the Registration Statement has been signed below by the
following persons in the capacities and on the dates indicated.
Signatures Title Date
________________________ _______________________________ _______
/s/Marie E. Connolly* President and Treasurer (Principal 12/24/96
____________________________ Executive, Financial and Accounting
Marie E. Connolly Officer)
/s/Joseph S. DiMartino* Director 12/24/96
___________________________
Joseph S. DiMartino
/s/David P. Feldman* Director 12/24/96
___________________________
David P. Feldman
/s/John M. Fraser, Jr.* Director 12/24/96
___________________________
John M. Fraser, Jr.
/s/Robert R. Glauber* Director 12/24/96
___________________________
Robert R. Glauber
/s/James F. Henry* Director 12/24/96
___________________________
James F. Henry
/s/Rosalind Gersten Jacobs* Director 12/24/96
___________________________
Rosalind Gersten Jacobs
/s/Irving Kristol* Director 12/24/96
___________________________
Irving Kristol
/s/Paul A. Marks* Director 12/24/96
___________________________
Paul A. Marks
/s/Martin Peretz* Director 12/24/96
___________________________
Martin Peretz
/s/Bert Wasserman* Director 12/24/96
___________________________
Bert Wasserman
*BY: __________________________
Elizabeth Keeley,
Attorney-in-Fact
EXHIBIT INDEX
Exhibits
(11) Consent of Independent Auditors
(17) Financial Data Schedule
Other Exhibits
Powers of Attorney
Assistant Secretary's Certificate
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Transfer and
Dividend Disbursing Agent, Custodian, Counsel and Independent Auditors"
and to the use of our report on Dreyfus International Equity Fund, Inc.
dated July 8, 1996, in this Registration Statement (Form N-1A 33-58248)
of Dreyfus Emerging Market Fund, (a portfolio of Dreyfus International
Funds, Inc.)
ERNST & YOUNG LLP
New York, New York
December 24, 1996
Other Exhibit
DREYFUS INTERNATIONAL FUNDS, INC.
Assistant Secretary's Certificate
The undersigned, Elizabeth Bachman Keeley, Assistant Secretary of
Dreyfus International Funds, Inc. (the "Fund") hereby certifies that set
forth below is a copy of the resolution adopted by the Fund's Board by
Written Consent dated October 21, 1996.
RESOLVED, that the Registration Statement and any and all
amendments and supplements thereto may be signed by any one of
Elizabeth A. Bachman, Marie E. Connolly, Richard W. Ingram, Mark A.
Karpe, and John E. Pelletier, as the attorney-in-fact for the
proper officers of the Fund, a with full power of substitution and
resubstitution; and that the appointment of each of such persons as
such attorney-in-fact hereby is authorized and approved; and that
such attorneys-in-fact, and each of them, shall have full power and
authority to do and perform each and every act and thing requisite
and necessary to be done in connection with such Registration
Statement and any and all amendments and supplements thereto, as
whom he or she is acting as attorney-in-fact, might or could do in
person.
IN WITNESS THEREOF, I have hereunto signed my name and affixed the seal
of the Fund on December 24, 1996.
________________________
Elizabeth Bachman Keeley
Vice President & Assistant Secretary
POWER OF ATTORNEY
The undersigned hereby constitute and appoint Elizabeth A. Bachman,
Marie E. Connolly, Richard W. Ingram, Mark A. Karpe, and John E. Pelletier,
and each of them, with full power to act without the other, his or her true
and lawful attorney-in-fact and agent, with full power of substitution and
resubstitution, for him or her, and in his or her name, place and stead, in
any and all capacities (until revoked in writing) to sign any and all
amendments to the Registration Statement of each Fund enumerated on Exhibit A
hereto (including post-effective amendments and amendments thereto), and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing ratifying and confirming all that
said attorneys-in-fact and agents or any of them, or their or his or her
substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
October 21, 1996
Joseph S. DiMartino
October 21, 1996
David P. Feldman
October 21, 1996
John M. Fraser, Jr.
October 21, 1996
Robert R. Glauber
October 21, 1996
James F. Henry
October 21, 1996
Rosalind Gersten Jacobs
October 21, 1996
Irving Kristol
October 21, 1996
Paul A. Marks
October 21, 1996
Martin Peretz
October 21, 1996
Bert W. Wasserman
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