MUNIVEST
FLORIDA FUND
[FUND LOGO]
STRATEGIC
Performance
Annual Report
October 31, 1997
This report, including the financial information herein, is transmitted to
the shareholders of MuniVest Florida Fund for their information. It is not
a prospectus, circular or representation intended for use in the purchase
of shares of the Fund or any securities mentioned in the report. Past
performance results shown in this report should not be considered a
representation of future performance. The Fund has leveraged its Common
Shares by issuing Preferred Shares to provide the Common Shareholders with
a potentially higher rate of return. Leverage creates risks for Common
Shareholders, including the likelihood of greater volatility of net asset
value and market price of shares of the Common Shares, and the risk that
fluctuations in the short-term dividend rates of the Preferred Shares may
affect the yield to Common Shareholders. Statements and other information
herein are as dated and are subject to change.
MuniVest
Florida Fund
Box 9011
Princeton, NJ
08543-9011 #16636 -- 10/97
[RECYCLE LOGO] Printed on post-consumer recycled paper
MUNIVEST FLORIDA FUND
The Benefits and
Risks of
Leveraging
MuniVest Florida Fund utilizes leveraging to seek to enhance the yield and
net asset value of its Common Shares. However, these objectives cannot be
achieved in all interest rate environments. To leverage, the Fund issues
Preferred Shares, which pay dividends at prevailing short-term interest
rates, and invests the proceeds in long-term municipal bonds. The interest
earned on these investments is paid to Common Shareholders in the form of
dividends, and the value of these portfolio holdings is reflected in the
per share net asset value of the Fund's Common Shares. However, in order
to benefit Common Shareholders, the yield curve must be positively sloped;
that is, short-term interest rates must be lower than long-term interest
rates. At the same time, a period of generally declining interest rates
will benefit Common Shareholders. If either of these conditions change,
then the risks of leveraging will begin to outweigh the benefits.
To illustrate these concepts, assume a fund's Common Share capitalization
of $100 million and the issuance of Preferred Shares for an additional $50
million, creating a total value of $150 million available for investment
in long-term municipal bonds. If prevailing short-term interest rates are
approximately 3% and long-term interest rates are approximately 6%, the
yield curve has a strongly positive slope. The fund pays dividends on the
$50 million of Preferred Shares based on the lower short-term interest
rates. At the same time, the fund's total portfolio of $150 million earns
the income based on long-term interest rates. Of course, increases in
short-term interest rates would reduce (and even eliminate) the dividends
on the Common Shares.
In this case, the dividends paid to Preferred Shareholders are
significantly lower than the income earned on the fund's long-term
investments, and therefore the Common Shareholders are the beneficiaries
of the incremental yield. However, if short-term interest rates rise,
narrowing the differential between short-term and long-term interest
rates, the incremental yield pickup on the Common Shares will be reduced
or eliminated completely. At the same time, the market value of the fund's
Common Shares (that is, its price as listed on the New York Stock
Exchange) may, as a result, decline. Furthermore, if long-term interest
rates rise, the Common Shares' net asset value will reflect the full
decline in the price of the portfolio's investments, since the value of
the fund's Preferred Shares does not fluctuate. In addition to the decline
in net asset value, the market value of the fund's Common Shares may also
decline.
MuniVest Florida Fund, October 31, 1997
DEAR SHAREHOLDER
For the year ended October 31, 1997, the Common Shares of MuniVest Florida
Fund earned $0.774 per share income dividends, which included earned and
unpaid dividends of $0.065. This represents a net annualized yield of
5.58%, based on a month-end per share net asset value of $13.87. Over the
same period, the total investment return on the Fund's Common Shares was
+9.93%, based on a change in per share net asset value from $13.39 to
$13.87, and assuming reinvestment of $0.775 per share income dividends.
For the six-month period ended October 31, 1997, the total investment
return on the Fund's Common Shares was +8.80%, based on a change in per
share net asset value from $13.12 to $13.87, and assuming reinvestment of
$0.379 per share income dividends.
For the six-month period ended October 31, 1997, the Fund's Auction Market
Preferred Shares had an average yield of 3.53%.
The Municipal Market Environment
Long-term interest rates generally declined during the six-month period
ended October 31, 1997. The general financial environment has remained one
of solid economic growth tempered by few or no inflationary pressures.
While economic growth has been conducive to declining bond yields, it has
remained strong enough to suggest that the Federal Reserve Board (FRB)
might find it necessary to raise short-term interest rates. This would be
intended to slow economic growth and ensure that any incipient
inflationary pressures would be curtailed. There were investor concerns
that the FRB would be forced to raise interest rates prior to year-end,
thus preventing an even more dramatic decline in interest rates. Long-term
tax-exempt revenue bonds, as measured by the Bond Buyer Revenue Bond
Index, declined over 50 basis points (0.50%) to end the six-month period
ended October 31, 1997 at 5.60%.
Similarly, long-term US Treasury bond yields generally moved lower during
most of the six-month period ended October 31, 1997. However, the turmoil
in the world's equity markets during the last week in October has resulted
in a significant rally in the Treasury bond market. The US Treasury bond
market was the beneficiary of a flight to quality mainly by foreign
investors whose own domestic markets have continued to be very volatile.
Prior to the initial decline in Asian equity markets, long-term US
Treasury bond yields were essentially unchanged. By the end of October, US
Treasury bond yields declined 80 basis points to 6.15%, their lowest level
of 1997.
The tax-exempt bond market's continued underperformance as compared to its
taxable counterpart has been largely in response to its ongoing weakening
technical position. As municipal bond yields have declined, municipalities
have hurriedly rushed to refinance outstanding higher-couponed debt with
new issues financed at present low rates. During the last six months, over
$118 billion in new long-term tax-exempt issues were underwritten, an
increase of over 25% versus the comparable period a year ago. As interest
rates have continued to decline, these refinancings have intensified
municipal bond issuance. During the past three months, approximately $60
billion in new long-term municipal securities were underwritten, an
increase of over 34% as compared to the October 31, 1996 quarter.
The recent trend toward larger and larger bond issues has also continued.
However, issues of such magnitude usually must be attractively priced to
ensure adequate investor interest. Obviously, the yields of other
municipal bond issues are impacted by the yield premiums such large
issuers have been required to pay. Much of the municipal bond market's
recent underperformance can be traced to market pressures that these large
bond issuances have exerted.
In our opinion, the recent correction in world equity markets has enhanced
the near-term prospects for continued low, if not declining, interest
rates in the United States. It is likely that the recent correction will
result in slower US domestic growth in the coming months. This decline is
likely to be generated in part by reduced US export growth. Additionally,
some decline in consumer spending also can be expected in response to
reduced consumer confidence. Perhaps more importantly, it is likely that
barring a dramatic and unexpected resurgence in domestic growth, the FRB
may be unwilling to raise interest rates until the full impact of the
equity market's corrections can be established.
All of these factors suggest that for at least the near term, interest
rates, including tax-exempt bond yields, are unlikely to rise by any
appreciable amount. It is probable that municipal bond yields will remain
under some pressure as a result of continued strong new-issue supply.
However, the recent pace of municipal bond issuance is likely to be
unsustainable. Continued increases in bond issuance will require lower
tax-exempt bond yields to generate the economic savings necessary for
additional municipal bond refinancing. With tax-exempt bond yields at
already attractive yield ratios relative to US Treasury bonds
(approximately 90% at the end of October), any further pressure on the
municipal market may represent an attractive investment opportunity.
Portfolio Strategy
At the beginning of 1997, our outlook was for higher interest rates. Since
the bond market had rallied in anticipation of a weakening economy with no
possibility of a FRB tightening, we perceived a risk of sudden change in
investor expectations. At this time, the Fund remained fully invested as
we purchased bonds less sensitive to interest rate volatility, such as
shorter-duration bonds. This strategy proved beneficial as economic data
released during the fourth quarter of 1996 and the first quarter of 1997
showed significant signs of strength. As a result, the FRB increased
short-term interest rates 25 basis points and pushed tax-exempt interest
rates to 6% by the middle of April. Anticipating further tightening, we
remained cautious on the bond market and concentrated on protecting the
Fund's net asset value and maintaining as high a level as possible of
tax-exempt income.
Surprisingly, the bond market staged a significant rally during the summer
months, and long-term tax-exempt yields declined nearly 75 basis points.
In our opinion, this occurred as a result of the economy turning decidedly
weaker in the second quarter of 1997. Fortunately, higher-coupon bonds,
which we purchased for defensive measures, outperformed aggressively
structured bonds since they were now advance refunding candidates. We
maintained a defensive, fully invested posture for the Fund for the
remainder of the 12-month period ended October 31, 1997 as the bond market
remained in a narrow 25 basis point trading range.
Looking ahead, our outlook is for lower interest rates. The economic
expansion is now entering its seventh year with benign inflation. Equity
markets throughout the world have entered into a very volatile stage
triggered by the currency crisis in the Southeast Asia. We believe a
continuation of equity market declines may have a negative impact on
economic growth, thereby constraining global inflation.
The yield on the Fund's Auction Market Preferred Shares has been trading
between 3.0% -- 3.7% during the past year. Leverage continues to benefit
the Fund's Common Shareholders by significantly augmenting their yield.
However, should the spread between short-term and long-term tax-exempt
interest rates narrow, the benefits of leverage will decline and, as a
result, reduce the yield to the Fund's Common Shares. (For a complete
explanation of the benefits and risks of leveraging, see page 1 of
this report to shareholders.)
In Conclusion
We appreciate your ongoing interest in MuniVest Florida Fund, and we look
forward to serving your investment needs in the months and years to come.
Sincerely,
/S/ARTHUR ZEIKEL
Arthur Zeikel
President
/S/VINCENT R. GIORDANO
Vincent R. Giordano
Senior Vice President
/S/ROBERT A. DIMELLAZ
Robert A. DiMella
Vice President and Portfolio Manager
December 9, 1997
<TABLE>
<CAPTION>
PROXY RESULTS
During the six-month period ended October 31, 1997, MuniVest Florida Fund Common Shareholders voted
on the following proposals. The proposals were approved at a shareholders' meeting on October 20,
1997. The description of each proposal and number of shares voted are as follows:
Shares Voted Shares Withheld
For From Voting
<S> <C> <C> <C>
1. To elect the Fund's Board of Trustees: Edward H. Meyer 5,698,366 123,999
Jack B. Sunderland 5,710,832 111,533
J. Thomas Touchton 5,716,629 105,736
Arthur Zeikel 5,716,399 105,966
Shares Voted Shares Voted Shares Voted
For Against Abstain
2. To select Deloitte & Touche LLP as the
Fund's independent auditors. 5,657,766 68,919 95,680
During the six-month period ended October 31, 1997, MuniVest Florida Fund Preferred Shareholders
voted on the following proposals. The proposals were approved at a special shareholders' meeting on
October 20, 1997. The description of each proposal and number of shares voted are as follows:
Shares Voted Shares Withheld
For From Voting
1. To elect the Fund's Board of Trustees: Donald Cecil 938 8
M. Colyer Crum 938 8
Edward H. Meyer 938 8
Jack B. Sunderland 938 8
J. Thomas Touchton 938 8
Arthur Zeikel 938 8
Shares Voted Shares Voted Shares Voted
For Against Abstain
2. To select Deloitte & Touche LLP as the
Fund's independent auditors. 934 8 4
</TABLE>
<TABLE>
<CAPTION>
SCHEDULE OF INVESTMENTS (in Thousands)
S&P Moody's Face Value
STATE Ratings Ratings Amount Issue (Note 1a)
<S> <C> <C> <C> <C> <C>
Florida --
98.6 AAA Aaa $5,000 Brevard County, Florida, IDR (NUI Corporation Project), AMT, 6.40% due 10/01/2024 (b) 5,460
AAA NR* 1,355 Broward County, Florida, HFA, Revenue Bonds, AMT, Series A, 7.35% due 3/01/2023 (e)(f) 1,436
AAA Aaa 8,200 Citrus County, Florida, PCR, Refunding (Florida Power Corp. -- Crystal River),
Series B, 6.35% due 2/01/2022 (c) 8,908
AAA Aaa 5,000 Dade County, Florida, Aviation Revenue Bonds (Miami International Airport),
Series C, 5.125% due 10/01/2027 (i) 4,847
AAA Aaa 1,125 Dade County, Florida, Educational Facilities Authority, Exchangeable Revenue Bonds
(University of Miami), 7.65% due 4/01/2010 (c) 1,229
A1+ VMIG1+ 600 Dade County, Florida, IDA, PCR, Refunding (Florida Power & Light Co. Project),
VRDN, AMT, 3.65% due 4/01/2020 (a) 600
AA- Aa3 2,250 Dade County, Florida, IDA, Solid Waste Disposal Revenue Bonds (Florida Power
& Light Co. Project), AMT, 7.15% due 2/01/2023 2,446
Escambia County, Florida, HFA, S/F Mortgage Revenue Bonds, AMT (f):
AAA Aaa 3,000 Refunding (Multi-County Program), 7% due 4/01/2028 (e) 3,292
NR* Aaa 2,230 Series A, 7.40% due 10/01/2023 2,356
BBB Baa1 1,920 Escambia County, Florida, PCR (Champion International Corporation Project), AMT,
6.90% due 8/01/2022 2,130
Florida HFA, Home Ownership Revenue Bonds, AMT:
AAA Aaa 5,000 Series 2, 5.90% due 7/01/2029 (c) 5,140
NR* Aaa 1,645 Series G-1, 7.90% due 3/01/2022 (f) 1,749
Florida State Board of Education, Public Education Revenue Bonds (Capital Outlay) (h):
AAA Aaa 6,430 Series A, 6.75% due 6/01/2001 7,041
AAA Aaa 3,500 Series B, 6.70% due 6/01/2001 3,827
AAA Aaa 2,000 Florida State Division Board Finance, Department of General Services Revenue Bonds
(Department of Natural Resourse Preservation), Series 2000-A, 6.75% due 7/01/2001 (b)(h) 2,211
NR* NR* 4,700 Florida State Mid-Bay Bridge Authority, Crossover Revenue Refunding Bonds,
Series A, 6.10% due 10/01/2022 4,863
AAA Aaa 1,900 Florida State Turnpike Authority, Turnpike Revenue Refunding Bonds,
Series A, 5% due 7/01/2019 (d) 1,822
AAA Aaa 5,000 Fort Myers, Florida, Improvement Revenue Refunding Bonds, Series A, 5% due 12/01/2022 (b) 4,800
AA Aa 6,925 Gainesville, Florida, Utilities System Revenue Bonds, Series A, 6.50% due 10/01/2002 (h) 7,719
A A3 5,400 Hillsborough County, Florida, Capital Improvement Revenue Bonds (County Center Project),
Second Series, 6.75% due 7/01/2002 (h) 6,047
AAA Aaa 2,000 Hillsborough County, Florida, Utility Revenue Refunding Bonds, Series B,
6.50% due 8/01/2016 (c) 2,171
AAA Aaa 5,000 Jacksonville, Florida, District Water and Sewer Revenue Bonds, 5% due 10/01/2008 (c)(h) 5,192
Jacksonville, Florida, Health Facilities Authority, Hospital Revenue Bonds:
AAA Aaa 1,000 (Charity Obligation Group), Series A, 5.125% due 8/15/2027 (c) 964
AA+ NR* 2,000 Refunding (Saint Luke's Hospital Association Project), 7.125% due 11/15/2020 2,207
NR* Baa1 345 Jacksonville, Florida, Health Facilities Authority, IDR (National Benevolent
Cypress Village), Series A, 6.125% due 12/01/2016 361
AAA Aaa 1,000 Lakeland, Florida, Electric & Water Revenue Refunding and Improvement Bonds
(Junior Sub Lien), Series B, 6% due 10/01/2007 (d) 1,113
NR* Aaa 3,250 Manatee County, Florida, HFA, S/F Mortgage Revenue Bonds, AMT, Sub-Series 2,
7.75% due 5/01/2026 (f) 3,687
BBB+ Baa 2,890 Nassau County, Florida, PCR, Refunding (ITT Rayonier, Inc. Project), 6.20% due 7/01/2015 3,009
AAA Aaa 1,150 Okaloosa County, Florida, Gas District Revenue Bonds (Gas System),
Series A, 5.125% due 10/01/2016 (c) 1,139
AAA Aaa 9,000 Orange County, Florida, Tourist Development, Tax Revenue Refunding Bonds,
5% due 10/01/2019 (c) 8,743
AAA Aaa 1,890 Palm Beach County, Florida, Criminal Justice Facilities Revenue Bonds,
7.20% due 6/01/2015 (d) 2,352
AAA Aaa 1,200 Port Everglades Authority, Florida, Port Improvement Revenue Bonds,
7.125% due 11/01/2016 (g) 1,450
AAA Aaa 5,000 Port Saint Lucie, Florida, Utility Revenue Refunding & Improvement Bonds,
Series A, 5.125% due 9/01/2027 (c) 4,884
AA- Aa3 1,000 Saint Lucie County, Florida, Solid Waste Disposal Revenue Bonds
(Florida Power & Light Co. Project), AMT, 6.70% due 5/01/2027 1,081
AAA Aaa 5,000 South Broward Hospital District, Florida, Hospital Revenue Refunding Bonds,
5.25% due 5/01/2021 (c) 4,888
Total Investments (Cost -- $114,158) -- 98.6% 121,164
Other Assets Less Liabilities -- 1.4% 1,754
----------
Net Assets -- 100.0% $122,918
==========
(a) The interest rate is subject to change periodically based upon prevailing market rates. The interest
rate shown is the rate in effect at October 31, 1997.
(b) AMBAC Insured.
(c) MBIA Insured.
(d) FGIC Insured.
(e) FNMA Collateralized.
(f) GNMA Collateralized.
(g) Escrowed to Maturity.
(h) Prerefunded.
(i) FSA Insured.
* Not Rated.
+ Highest short-term rating by Moody's Investors Service, Inc.
Ratings of issues shown have not been audited by Deloitte & Touche LLP.
Portfolio
Abbreviations
To simplify the listings of MuniVest Florida Fund's portfolio holdings in the Schedule of
Investments, we have abbreviated the names of many of the securities according to the list at right.
AMT Alternative Minimum Tax (subject to)
HFA Housing Finance Agency
IDA Industrial Development Authority
IDR Industrial Development Revenue Bonds
PCR Pollution Control Revenue Bonds
S/F Single-Family
VRDN Variable Rate Demand Notes
See Notes to Financial Statements.
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF ASSETS, LIABILITIES AND CAPITAL
As of October 31, 1997
<S> <C> <C> <C>
Assets: Investments, at value (identified cost -- $114,158,386) (Note 1a) $121,164,403
Cash 73,369
Interest receivable 1,856,980
Deferred organization expenses (Note 1e) 2,642
Prepaid expenses and other assets 6,859
------------
Total assets 123,104,253
------------
Liabilities: Payables:
Investment adviser (Note 2) $55,257
Dividends to shareholders (Note 1f) 51,824 107,081
------------
Accrued expenses and other liabilities 79,593
------------
Total liabilities 186,674
------------
Net Assets: Net assets $122,917,579
============
Capital: Capital Shares (unlimited number of shares of beneficial interest authorized) (Note 4):
Preferred Shares, par value $.05 per share (1,600 shares of AMPS* issued and outstanding
at $25,000 per share liquidation preference) $40,000,000
Common Shares, par value $.10 per share (5,978,662 shares issued and outstanding) $597,866
Paid-in capital in excess of par 83,198,076
Undistributed investment income -- net 487,977
Accumulated realized capital losses on investments -- net (Note 5) (8,372,357)
Unrealized appreciation on investments -- net 7,006,017
------------
Total -- Equivalent to $13.87 net asset value per Common Share (market price -- $13.00) 82,917,579
------------
Total capital $122,917,579
============
*Auction Market Preferred Shares.
See Notes to Financial Statements.
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS
For the Year Ended October 31, 1997
<S> <C> <C> <C>
Investment Interest and amortization of premium and discount earned $6,956,995
Income (Note 1d):
Expenses: Investment advisory fees (Note 2) $605,833
Commission fees (Note 4) 103,424
Professional fees 75,080
Accounting services (Note 2) 32,677
Transfer agent fees 30,628
Trustees' fees and expenses 22,625
Printing and shareholder reports 22,146
Listing fees 16,851
Custodian fees 9,847
Pricing fees 6,156
Amortization of organization expenses (Note 1e) 5,357
Other 14,294
------------
Total expenses 944,918
------------
Investment income -- net 6,012,077
------------
Realized & Realized gain on investments -- net 1,216,839
Unrealized Change in unrealized appreciation on investments -- net 1,616,148
Gain on ------------
Investments -- Net Net Increase in Net Assets Resulting from Operations $8,845,064
(Notes 1b, 1d & 3): ============
See Notes to Financial Statements.
</TABLE>
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS
For the Year Ended
October 31,
Increase (Decrease) in Net Assets: 1997 1996
<S> <C> <C> <C>
Operations: Investment income -- net $6,012,077 $5,912,407
Realized gain on investments -- net 1,216,839 2,150,848
Change in unrealized appreciation/depreciation on investments -- net 1,616,148 (779,005)
------------- -------------
Net increase in net assets resulting from operations 8,845,064 7,284,250
------------- -------------
Dividends to Investment income -- net:
Shareholders Common Shares (4,635,108) (4,543,484)
(Note 1f): Preferred Shares (1,349,984) (1,378,160)
------------- -------------
Net decrease in net assets resulting from dividends to shareholders (5,985,092) (5,921,644)
------------- -------------
Net Assets: Total increase in net assets 2,859,972 1,362,606
Beginning of year 120,057,607 118,695,001
------------- -------------
End of year* $122,917,579 $120,057,607
============= =============
* Undistributed investment income -- net $487,977 $460,992
============= =============
See Notes to Financial Statements.
</TABLE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
For the
Period
The following per share data and ratios have been derived Apr. 30,
from information provided in the financial statements. 1993+ to
For the Year Ended October 31, Oct. 31,
Increase (Decrease) in Net Asset Value: 1997 1996 1995 1994 1993
<S> <C> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $13.39 $13.16 $11.82 $14.99 $14.18
Operating ------- ------- ------- ------- -------
Performance: Investment income -- net 1.01 .99 1.01 1.00 .49
Realized and unrealized gain (loss) on investments -- net .48 .23 1.34 (3.05) .90
------- ------- ------- ------- -------
Total from investment operations 1.49 1.22 2.35 (2.05) 1.39
------- ------- ------- ------- -------
Less dividends and distributions to Common Shareholders:
Investment income -- net (.78) (.76) (.76) (.84) (.35)
Realized gain on investments -- net -- -- -- (.11) --
------- ------- ------- ------- -------
Total dividends and distributions to Common Shareholders (.78) (.76) (.76) (.95) (.35)
------- ------- ------- ------- -------
Capital charge resulting from issuance of Common Shares -- -- -- -- (.04)
------- ------- ------- ------- -------
Effect of Preferred Share activity:++
Dividends and distributions to Preferred Shareholders:
Investment income -- net (.23) (.23) (.25) (.15) (.07)
Realized gain on investments -- net -- -- -- (.02) --
Capital charge resulting from issuance of
Preferred Shares -- -- -- -- (.12)
------- ------- ------- ------- -------
Total effect of Preferred Share activity (.23) (.23) (.25) (.17) (.19)
------- ------- ------- ------- -------
Net asset value, end of period $13.87 $13.39 $13.16 $11.82 $14.99
======= ======= ======= ======= =======
Market price per share, end of period $13.00 $12.75 $11.50 $10.00 $15.00
======= ======= ======= ======= =======
Total Investment Based on market price per share 8.21% 17.87% 22.93% (28.20%) 2.37%++++
Return:** ======= ======= ======= ======= =======
Based on net asset value per share 9.93% 8.17% 19.02% (15.07%) 8.22%++++
======= ======= ======= ======= =======
Ratios to Average Expenses, net of reimbursement .78% .82% .85% .75% .48%*
Net Assets:*** ======= ======= ======= ======= =======
Expenses .78% .82% .85% .78% .83%*
======= ======= ======= ======= =======
Investment income -- net 4.96% 4.96% 5.38% 4.94% 4.85%*
======= ======= ======= ======= =======
Supplemental Net assets, net of Preferred Shares, end
Data: of period (in thousands) $82,918 $80,058 $78,695 $70,674 $89,438
======= ======= ======= ======= =======
Preferred Shares outstanding, end of period
(in thousands) $40,000 $40,000 $40,000 $40,000 $40,000
======= ======= ======= ======= =======
Portfolio turnover 89.21% 116.82% 92.54% 100.98% 23.23%
======= ======= ======= ======= =======
Leverage: Asset coverage per $1,000 $3,073 $3,001 $2,967 $2,767 $3,236
======= ======= ======= ======= =======
Dividends Investment income -- net $844 $861 $940 $569 $245
Per Share on ======= ======= ======= ======= =======
Preferred Shares
Outstanding:+++
* Annualized.
** Total investment returns based on market value, which can be significantly greater or lesser
than the net asset value, may result in substantially different returns. Total investment
returns exclude the effects of sales loads.
*** Do not reflect the effect of dividends to Preferred Shareholders.
+ Commencement of operations.
++ The Fund's Preferred Shares were issued on June 1, 1993.
+++ Dividends per share have been adjusted to reflect a two-for-one stock split that occurred
on December 1, 1994.
++++ Aggregate total investment return.
See Notes to Financial Statements.
</TABLE>
MuniVest Florida Fund, October 31, 1997
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
MuniVest Florida Fund (the "Fund") is registered under the Investment
Company Act of 1940 as a non-diversified, closed-end management investment
company. The Fund determines and makes available for publication the net
asset value of its Common Shares on a weekly basis. The Fund's Common
Shares are listed on the New York Stock Exchange under the symbol MVS. The
following is a summary of significant accounting policies followed by the
Fund.
(a) Valuation of investments -- Municipal bonds are traded primarily in
the over-the-counter markets and are valued at the most recent bid price
or yield equivalent as obtained by the Fund's pricing service from dealers
that make markets in such securities. Financial futures contracts and
options thereon, which are traded on exchanges, are valued at their
closing prices as of the close of such exchanges. Options, which are
traded on exchanges, are valued at their last sale price as of the close
of such exchanges or, lacking any sales, at the last available bid price.
Securities with remaining maturities of sixty days or less are valued at
amortized cost, which approximates market value. Securities for which
market quotations are not readily available are valued at fair value as
determined in good faith by or under the direction of the Board of
Trustees of the Fund, including valuations furnished by a pricing service
retained by the Fund, which may utilize a matrix system for valuations.
The procedures of the pricing service and its valuations are reviewed by
the officers of the Fund under the general supervision of the Board of
Trustees.
(b) Derivative financial instruments -- The Fund may engage in various
portfolio strategies to seek to increase its return by hedging its
portfolio against adverse movements in the debt markets. Losses may arise
due to changes in the value of the contract or if the counterparty does
not perform under the contract.
[bullet] Financial futures contracts -- The Fund may purchase or sell
interest rate futures contracts and options on such futures contracts for
the purpose of hedging the market risk on existing securities or the
intended purchase of securities. Futures contracts are contracts for
delayed delivery of securities at a specific future date and at a specific
price or yield. Upon entering into a contract, the Fund deposits and
maintains as collateral such initial margin as required by the exchange on
which the transaction is effected. Pursuant to the contract, the Fund
agrees to receive from or pay to the broker an amount of cash equal to the
daily fluctuation in value of the contract. Such receipts or payments are
known as variation margin and are recorded by the Fund as unrealized gains
or losses. When the contract is closed, the Fund records a realized gain
or loss equal to the difference between the value of the contract at the
time it was opened and the value at the time it was closed.
[bullet] Options -- The Fund is authorized to write covered call options
and purchase put options. When the Fund writes an option, an amount equal
to the premium received by the Fund is reflected as an asset and an
equivalent liability. The amount of the liability is subsequently marked
to market to reflect the current market value of the option written.
When a security is purchased or sold through an exercise of an option, the
related premium paid (or received) is added to (or deducted from) the
basis of the security acquired, or deducted from (or added to) the
proceeds of the security sold. When an option expires (or the Fund enters
into a closing transaction), the Fund realizes a gain or loss on the
option to the extent of the premiums received or paid (or gain or loss to
the extent the cost of the closing transaction exceeds the premium paid
or received).
Written and purchased options are non-income producing investments.
(c) Income taxes -- It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its taxable
income to its shareholders. Therefore, no Federal income tax provision is
required.
(d) Security transactions and investment income -- Security transactions
are recorded on the dates the transactions are entered into (the trade
dates). Interest income is recognized on the accrual basis. Discounts and
market premiums are amortized into interest income. Realized gains and
losses on security transactions are determined on the identified cost
basis.
(e) Deferred organization expenses -- Deferred organization expenses are
amortized on a straight-line basis over a five-year period.
(f) Dividends and distributions -- Dividends from net investment income
are declared and paid monthly. Distributions of capital gains are recorded
on the ex-dividend dates.
2. Investment Advisory Agreement and Transactions with Affiliates:
The Fund has entered into an Investment Advisory Agreement with Fund Asset
Management, L.P. ("FAM"). The general partner of FAM is Princeton
Services, Inc. ("PSI"), an indirect wholly-owned subsidiary of Merrill
Lynch & Co., Inc. ("ML & Co."), which is the limited partner.
FAM is responsible for the management of the Fund's portfolio and provides
the necessary personnel, facilities, equipment and certain other services
necessary to the operations of the Fund. For such services, the Fund pays
a monthly fee at an annual rate of 0.50% of the Fund's average weekly net
assets.
Accounting services are provided to the Fund by FAM at cost.
Certain officers and/or trustees of the Fund are officers and/or directors
of FAM, PSI, and/or ML & Co.
3. Investments:
Purchases and sales of investments, excluding short-term securities, for
the year ended October 31, 1997 were $106,864,878 and $103,332,237,
respectively.
Net realized and unrealized gains (losses) as of October 31, 1997 were as
follows:
Realized Unrealized
Gains (Losses) Gains
Long-term investments $1,458,399 $7,006,017
Financial future contracts (241,560) --
------------- -------------
Total $1,216,839 $7,006,017
============= =============
As of October 31, 1997, net unrealized appreciation for Federal income tax
purposes aggregated $7,006,017, all of which is related to appreciated
securities. The aggregate cost of investments at October 31, 1997 for
Federal income tax purposes was $114,158,386.
4. Capital Shares Transactions:
The Fund is authorized to issue an unlimited number of shares of
beneficial interest, including Preferred Shares, par value $.10 per share,
all of which were initially classified as Common Shares. The Board of
Trustees is authorized, however, to reclassify any unissued shares of
capital without approval of holders of Common Shares.
Common Shares
Shares issued and outstanding during the years ended October 31, 1997 and
October 31, 1996 remained constant.
Preferred Shares
Auction Market Preferred Shares ("AMPS") are Preferred Shares of the Fund
that entitle their holders to receive cash dividends at an annual rate
that may vary for the successive dividend periods. The yield in effect at
October 31, 1997 was 3.60%.
For the year ended October 31, 1997, there were 1,600 AMPS authorized,
issued and outstanding with a liquidation preference of $25,000 per share.
The Fund pays commissions to certain broker-dealers at the end
of each auction at an annual rate ranging from 0.25% to 0.375%, calculated
on the proceeds of each auction. For the year ended October 31, 1997,
Merrill Lynch, Pierce, Fenner & Smith Inc., an affiliate of FAM, earned
$60,986 as commissions.
5. Capital Loss Carryforward:
At October 31, 1997, the Fund had a capital loss carryforward of
approximately $6,318,000, of which $4,064,000 expires in 2002 and
$2,254,000 expires in 2003. This amount will be available to offset like
amounts of any future taxable gains.
6. Subsequent Event:
On November 6, 1997, the Fund's Board of Trustees declared an ordinary
income dividend to Common shareholders in the amount of $.064555 per
share, payable on November 26, 1997 to shareholders of record as of
November 17, 1997.
INDEPENDENT AUDITOR'S REPORT
The Board of Trustees and Shareholders,
MuniVest Florida Fund:
We have audited the accompanying statement of assets, liabilities and
capital, including the schedule of investments, of MuniVest Florida Fund
as of October 31, 1997, the related statements of operations for the year
then ended and changes in net assets for each of the years in the two-year
period then ended, and the financial highlights for each of the years in
the four-year period then ended and for the period April 30, 1993
(commencement of operations) to October 31, 1993. These financial
statements and the financial highlights are the responsibility of the
Fund's management. Our responsibility is to express an opinion on these
financial statements and the financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and the
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included
confirmation of securities owned as of October 31, 1997 by correspondence
with the custodian. 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 present
fairly, in all material respects, the financial position of MuniVest
Florida Fund as of October 31, 1997, the results of its operations, the
changes in its net assets, and the financial highlights for the respective
stated periods in conformity with generally accepted accounting
principles.
Deloitte & Touche LLP
Princeton, New Jersey
December 9, 1997
IMPORTANT TAX INFORMATION (unaudited)
All of the net investment income distributions paid by MuniVest Florida
Fund during its taxable year ended October 31, 1997 qualify as tax-exempt
interest dividends for Federal income tax purposes. Additionally, there
were no capital gains distributed by the Fund during the year.
Please retain this information for your records.
OFFICERS AND TRUSTEES
Arthur Zeikel, President and Trustee
Donald Cecil, Trustee
M. Colyer Crum, Trustee
Edward H. Meyer, Trustee
Jack B. Sunderland, Trustee
J. Thomas Touchton, Trustee
Terry K. Glenn, Executive Vice President
Vincent R. Giordano, Senior Vice President
Donald C. Burke, Vice President
Robert A. DiMella, Vice President
Kenneth A. Jacob, Vice President
Gerald M. Richard, Treasurer
Patrick D. Sweeney, Secretary
Custodian
The Bank of New York
90 Washington Street
New York, NY 10286
Transfer Agents
Common Shares:
The Bank of New York
101 Barclay Street
New York, NY 10286
Preferred Shares:
IBJ Schroder Bank & Trust Company
One State Street
New York, NY 10004
NYSE Symbol
MVS
