MUNIVEST
FLORIDA FUND
[GRAPHIC OMITTED]
STRATEGIC
Performance
Annual Report
October 31, 1998
<PAGE>
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 Share holders 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.
As a part of its investment strategy, the Fund may invest in certain securities
whose potential income return is inversely related to changes in a floating
interest rate ("inverse floaters"). In general, interest rates on inverse
floaters will decrease when short-term interest rates increase and increase when
short-term interest rates decrease. Investments in inverse floaters may be
characterized as derivative securities and may subject the Fund to the risks of
reduced or eliminated interest payments and losses of invested principal. In
addition, inverse floaters have the effect of providing investment leverage and,
as a result, the market value of such securities will generally be more volatile
than that of fixed-rate, tax-exempt securities. To the extent the Fund invests
in inverse floaters, the market value of the Fund's portfolio and the net asset
value of the Fund's shares may also be more volatile than if the Fund did not
invest in such securities.
<PAGE>
MuniVest Florida Fund, October 31, 1998
DEAR SHAREHOLDER
For the year ended October 31, 1998, the Common Shares of MuniVest Florida Fund
earned $0.763 per share income dividends, which included earned and unpaid
dividends of $0.066. This represents a net annualized yield of 5.38%, based on a
month-end net asset value of $14.20 per share. Over the same period, the total
investment return on the Fund's Common Shares was +8.16%, based on a change in
per share net asset value from $13.87 to $14.20, and assuming reinvestment of
$0.762 per share income dividends.
For the six months ended October 31, 1998, the total investment return on the
Fund's Common Shares was +5.96%, based on a change in per share net asset value
from $13.77 to $14.20, and assuming reinvestment of $0.378 per share income
dividends.
For the six-month period ended October 31, 1998, the Fund's Auction Market
Preferred Shares had an average yield of 3.15%.
The Municipal Market Environment
During the six months ended October 31, 1998, long-term bond yields declined
significantly. The near absence of any inflationary pressures in the United
States continued to support historic low interest rates. Additionally, foreign
economic factors have continued to outweigh US domestic fundamentals, as they
have for much of 1998. The economic crisis that began in Asia over a year ago
has spread both to Russia and South America. However, economic factors in these
countries have begun to negatively impact US growth. For example, employment in
the US manufacturing sector declined in recent months as a result of reduced
demand for export goods. Concern that the modest decline in US economic growth
seen thus far would spread and intensify led the Federal Reserve Board to lower
short-term interest rates in late September, in mid-October and in mid-November.
These actions were taken to offset the drag of foreign economies on future US
growth.
US Treasury bond yields continued to benefit from a strong "flight to quality"
as foreign investors were drawn to the relative safe haven of US Government
securities. Additionally, the sharp equity market correction, which began at the
end of August, triggered a further flight into US Treasury securities. Long-term
US Treasury bond yields fell over 90 basis points (0.90%) to approximately 5% by
the end of September. This is the lowest level since the US Treasury
reintroduced 30-year maturity bond auctions in 1977.
By early October, worldwide investor confidence began to rise, reducing the
demand for the safety and liquidity of US Treasury securities. Investor
confidence was restored by the belief that major world governments, as well as
the International Monetary Fund, would take the necessary action to support weak
domestic economies in Asia and Latin America. Additionally, rapid recovery in US
and world equity markets caused some investors to reallocate funds from US debt
instruments back to various world equity markets. US Treasury security yields
rose for the remainder of the month to end October at 5.15%. During the
six-month period ended October 31, 1998, long-term Treasury security yields
declined approximately 80 basis points.
During the past 12 months, the tax-exempt bond market has contended with
significant new-issue supply pressures. Over the past year, more than $277
billion in new long-term tax-exempt bonds were underwritten, an increase of
almost 30% compared to the same period a year ago. During the most recent
six-month period, approximately $140 billion in new long-term municipal bonds
were underwritten, representing an increase of more than 15% over the same
six-month period last year. This increased supply, coupled with the high returns
the US equity market generated for much of 1998, was one of the major reasons
municipal bond yields declined less than their taxable counterparts during the
period.
The continued increase in new bond issuance has required ever-lower tax-exempt
bond yields to generate the economic savings necessary for additional municipal
bond financings. Consequently, the pace of new bond issuance has slowed in
recent months. In fact, the trend may be reversing. During the three months
ended October 31, 1998, just over $60 billion in new long-term municipal bonds
were underwritten, a decline of 4% compared to the same quarter a year ago.
During the month of October, there were less than $20 billion in new municipal
bond securities issued, a decline of over 10% compared to October 1997. We will
monitor this trend closely in the coming months to determine if the supply
pressures exerted thus far in 1998 are abating and fostering a more balanced
supply/demand environment.
Throughout the six-month period ended October 31, 1998, municipal bond yields
followed a pattern that was similar to US Treasury securities, although the
yield declines were more muted. As measured by the unmanaged Bond Buyer Revenue
Bond Index, long-term, uninsured tax-exempt revenue bond yields declined over 40
basis points to 5.09% by the end of September, their lowest level since the
early 1970s. Municipal bond yields rose during October to end the period at
5.24%. Over the past six months, long-term tax-exempt bond yields declined
almost 30 basis points.
Although municipal bond yields declined during the six-month period, recent
supply pressures and the absence of the safe haven status enjoyed by US
securities caused municipal bond yields to rise relative to US Treasury bond
yields. At October 31, 1998, long-term tax-exempt bond yield spreads were
attractive relative to US Treasury securities of comparable maturities (over
100%), well in excess of their historic range of 85%-88%. Tax-exempt bond yield
ratios have rarely exceeded 90% in the 1980s and 1990s. Historically, yield
spreads have been wider than these levels when there have been potential changes
in Federal tax codes that would have adversely affected the tax-favored status
of municipal bonds.
Currently, municipal bond investors find themselves in a unique investment
environment. Previous opportunities to purchase tax-exempt bonds with yields
exceeding that of comparable US Treasury issues have been limited to relatively
brief episodes and then further limited to a few municipal credits undergoing
specific financial pressures. At present, almost the entire municipal bond
universe, across nearly all maturity and credit sectors, can be purchased at
yields greater than their taxable counterparts. However, the current opportunity
may quickly disappear should tax-exempt bond supply pressures diminish or the
safe-haven status of US Treasury securities become less desirable. Under these
conditions, municipal bond ratios should quickly revert to more normal historic
per centages, certainly well below their presently attractive levels.
Portfolio Strategy
During the six-month period ended October 31, 1998, we maintained our
constructive investment strategy. The Asian equity market turmoil created an
increase in demand for US Treasury securities, sending both taxable and
tax-exempt bond yields lower. We believed a continuation of equity market
declines would have a negative impact on economic growth, further constraining
global inflation and allowing for further declines in long-term interest rates.
This proved to be true as the increase in financial market volatility caused a
flight to quality into US Treasury bonds, pushing interest rates to historic
lows. Our constructive strategy enabled the Fund to fully participate in the
bond market rally and realize an attractive total return.
We believe that interest rates are likely to continue to trend lower in the
months ahead. Global economic growth appears to be slowing substantially.
Central banks throughout the world, including the US Federal Reserve Board, are
trying to stimulate economic growth by easing monetary policy. However, these
actions are likely to have a delayed impact. Consequently, our investment
outlook will remain constructive until there are signs that the economy has
started responding to the monetary stimulus.
During the six-month period ended October 31, 1998, the yield on the Fund's
Auction Market Preferred Shares traded between 2.35% and 4.00%. Leverage
continues to benefit the Common Shareholders by significantly augmenting their
yield. However, should the spread between short-term and long-term tax-exempt
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 thank you for your support of MuniVest Florida Fund, and we look forward to
serving your investment needs in the months and years ahead.
Sincerely,
/s/ Arthur Zeikel
Arthur Zeikel
President
/s/ Vincent R. Giordano
Vincent R. Giordano
Senior Vice President
/s/ William R. Bock
William R. Bock
Vice President and Portfolio Manager
December 2, 1998
- --------------------------------------------------------------------------------
We are pleased to announce that William R. Bock is responsible for the
day-to-day management of MuniVest Florida Fund. Mr. Bock has been employed by
Merrill Lynch Asset Management, L.P. (an affiliate of the Fund's investment
adviser) since 1989 as Vice President.
- --------------------------------------------------------------------------------
2 & 3
<PAGE>
MuniVest Florida Fund, October 31, 1998
PROXY RESULTS
During the six-month period ended October 31, 1998, MuniVest Florida Fund Common
Shareholders voted on the following proposals. The proposals were approved at a
shareholders' meeting on September 14, 1998. The description of each proposal
and number of shares voted are as follows:
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
Shares Voted Shares Withheld
For From Voting
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. To elect the Fund's Board of Trustees: Edward H. Meyer 5,711,241 97,170
Jack B. Sunderland 5,711,241 97,170
J. Thomas Touchton 5,711,241 97,170
Fred G. Weiss 5,711,241 97,170
Arthur Zeikel 5,711,241 97,170
</TABLE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
Shares Voted Shares Voted Shares Voted
For Against Abstain
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
2. To select Deloitte & Touche LLP as the Fund's independent auditors. 5,711,075 12,954 91,502
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>
During the six-month period ended October 31, 1998, MuniVest Florida Fund
Preferred Shareholders voted on the following proposals. The proposals were
approved at a shareholders' meeting on September 14, 1998. The description of
each proposal and number of shares voted are as follows:
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
Shares Voted Shares Withheld
For From Voting
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. To elect the Fund's Board of Trustees: Donald Cecil 1,342 18
M. Colyer Crum 1,342 18
Edward H. Meyer 1,342 18
Jack B. Sunderland 1,342 18
J. Thomas Touchton 1,342 18
Fred G. Weiss 1,342 18
Arthur Zeikel 1,342 18
</TABLE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
Shares Voted Shares Voted Shares Voted
For Against Abstain
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
2. To select Deloitte & Touche LLP as the Fund's independent auditors. 1,361 0 0
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>
SCHEDULE OF INVESTMENTS (in Thousands)
<TABLE>
<CAPTION>
S&P Moody's Face Value
STATE Ratings Ratings Amount Issue (Note 1a)
==================================================================================================================================
<S> <C> <C> <C> <C> <C>
Alaska--1.6% A1+ P1 $ 2,000 Valdez, Alaska, Marine Terminal Revenue Refunding Bonds (Exxon Pipeline
Co. Project), VRDN, Series C, 3.70% due 12/01/2033 (a) $ 2,000
==================================================================================================================================
Colorado--2.7% A1+ VMIG1+ 3,350 Moffat County, Colorado, PCR, Refunding (Pacificorp Projects), VRDN,
3.75% due 5/01/2013 (a)(b) 3,350
==================================================================================================================================
Florida--97.2% AAA Aaa 1,000 Bay Medical Center, Florida, Hospital Revenue Bonds (Bay Medical Center
Project), 5% due 10/01/2027 (b) 984
AAA Aaa 5,000 Brevard County, Florida, IDR (NUI Corporation Project), AMT, 6.40% due
10/01/2024 (b) 5,568
AAA NR* 1,195 Broward County, Florida, HFA, Revenue Bonds, AMT, Series A, 7.35% due
3/01/2023 (e)(f) 1,261
AAA Aaa 8,200 Citrus County, Florida, PCR, Refunding (Florida Power Corp.--Crystal
River), Series B, 6.35% due 2/01/2022 (c) 8,991
AAA Aaa 1,125 Dade County, Florida, Educational Facilities Authority, Exchangeable
Revenue Bonds (University of Miami), 7.65% due 4/01/2010 (c) 1,208
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 2,436
A1+ VMIG1+ 200 Dade County, Florida, Water and Sewer System Revenue Bonds, VRDN, 3.05%
due 10/05/2022 (a)(d) 200
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) 3,312
NR* Aaa 2,075 Series A, 7.40% due 10/01/2023 2,185
BBB Baa1 4,045 Escambia County, Florida, PCR (Champion International Corporation
Project), AMT, 6.90% due 8/01/2022 4,444
NR* Aaa 1,355 Florida HFA, Home Ownership Revenue Bonds, AMT, Series G-1, 7.90% due
3/01/2022 (f) 1,428
AAA Aaa 1,155 Florida Ports Financing Commission Revenue Bonds (State Transportation
Trust Fund), AMT, 5.375% due 6/01/2027 (c) 1,178
AAA Aaa 5,000 Florida State Board of Education, Public Education Revenue Bonds
(Capital Outlay), Series B, 4.50% due 6/01/2028 (c) 4,623
AAA Aaa 2,075 Florida State Department of General Services, Division of Facilities
Management Revenue Bonds (Florida Facilities Pool), Series B, 4.50%
due 9/01/2023 (i) 1,931
AAA Aaa 4,700 Florida State Mid-Bay Bridge Authority, Crossover Revenue Refunding
Bonds, Series A, 5.95% due 10/01/2022 (b) 5,150
AAA Aaa 2,775 Florida State Turnpike Authority, Turnpike Revenue Bonds (Department of
Transportation), Series B, 5% due 7/01/2016 (c) 2,809
AAA Aaa 5,000 Fort Myers, Florida, Improvement Revenue Refunding Bonds, Series A, 5%
due 12/01/2022 (b) 4,986
AA Aa3 1,900 Gainesville, Florida, Utilities System Revenue Bonds, Series A, 6.50%
due 10/01/2002 (h) 2,127
A A3 5,400 Hillsborough County, Florida, Capital Improvement Revenue Bonds (County
Center Project), Second Series, 6.75% due 7/01/2002 (h) 6,053
AAA Aaa 2,000 Hillsborough County, Florida, Utility Revenue Refunding Bonds, Series
B, 6.50% due 8/01/2016 (c) 2,171
==================================================================================================================================
</TABLE>
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 below and at right.
AMT Alternative Minimum Tax (subject to)
DATES Daily Adjustable Tax-Exempt Securities
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
4 & 5
<PAGE>
MuniVest Florida Fund, October 31, 1998
SCHEDULE OF INVESTMENTS (concluded) (in Thousands)
<TABLE>
<CAPTION>
S&P Moody's Face Value
STATE Ratings Ratings Amount Issue (Note 1a)
==================================================================================================================================
<S> <C> <C> <C> <C> <C>
Florida AAA Aaa $ 5,065 Jacksonville, Florida, Capital Improvement Revenue Refunding Bonds
(concluded) (Stadium Project), 4.75% due 10/01/2025 (b) $ 4,857
AA Aa2 4,000 Jacksonville, Florida, Electric Authority Revenue Bonds (Electric
System), Series 3-A, 5.10% due 10/01/2032 3,987
Jacksonville, Florida, Health Facilities Authority, Hospital Revenue
Refunding Bonds:
NR* VMIG1+ 100 (Genesis Rehabilitation Hospital), VRDN, 3.75% due 5/01/2021 (a) 100
AA+ NR* 2,000 (Saint Luke's Hospital Association Project), 7.125% due 11/15/2020 2,190
NR* Baa1 345 Jacksonville, Florida, Health Facilities Authority, IDR (National
Benevolent Cypress Village), Series A, 6.125% due 12/01/2016 368
NR* Aaa 3,030 Manatee County, Florida, HFA, S/F Mortgage Revenue Bonds, AMT,
Sub-Series 2, 7.75% due 5/01/2026 (f) 3,544
A1+ VMIG1+ 2,500 Martin County, Florida, PCR, Refunding (Florida Power & Light Co.
Project), VRDN, 3.70% due 9/01/2024 (a) 2,500
Miami-Dade County, Florida, Special Obligation Revenue Bonds (c):
AAA Aaa 2,000 Refunding, Series A, 5.10%** due 10/01/2015 856
AAA Aaa 5,685 Refunding, Series A, 5.461%** due 10/01/2018 2,025
AAA Aaa 5,000 Series B, 5.66%** due 10/01/2032 807
BBB+ Baa 2,890 Nassau County, Florida, PCR, Refunding (ITT Rayonier, Inc. Project),
6.20% due 7/01/2015 3,049
AAA Aaa 1,000 Ocoee, Florida, Revenue Refunding and Improvement Bonds
(Transportation), 4.50% due 10/01/2028 (c) 924
AAA Aaa 1,150 Okaloosa County, Florida, Gas District Revenue Bonds (Gas System),
Series A, 5.125% due 10/01/2016 (c) 1,181
AAA Aaa 5,000 Orlando & Orange County, Florida, Expressway Authority, Revenue
Refunding Bonds (Junior Lien), 5% due 7/01/2021 (d) 4,986
AAA Aaa 1,890 Palm Beach County, Florida, Criminal Justice Facilities Revenue Bonds,
7.20% due 6/01/2015 (d) 2,424
AAA Aaa 2,000 Palm Beach County, Florida, Solid Waste Authority, Revenue Refunding
Bonds, Series A, 4.60%** due 10/01/2012 (b) 1,039
AAA Aaa 2,500 Peace River/Manasota, Florida, Regional Water Supply Authority Revenue
Bonds (Peace River Option Project), Series A, 5% due 10/01/2028 (c) 2,492
A1+ VMIG1+ 300 Pinellas County, Florida, Health Facilities Authority, Revenue
Refunding Bonds (Pooled Hospital Loan Program), DATES, 3.70% due
12/01/2015 (a) 300
AAA Aaa 1,200 Port Everglades Authority, Florida, Port Improvement Revenue Bonds,
7.125% due 11/01/2016 (g) 1,508
A1+ VMIG1+ 100 Saint Lucie County, Florida, PCR, Refunding (Florida Power & Light Co.
Project), VRDN, 3.30% due 3/01/2027 (a) 100
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 1,091
AAA Aaa 5,000 Sarasota County, Florida, Public Hospital Board, Hospital Revenue
Refunding Bonds (Sarasota Memorial Hospital), Series B, 5.50% due
7/01/2028(c) 5,392
AAA Aaa 3,000 Tallahassee, Florida, Energy System Revenue Refunding Bonds, Series A,
4.75% due 10/01/2026 (i) 2,875
AAA Aaa 6,000 Tampa Bay, Florida, Water Utility System, Revenue Refunding Bonds,
Series A, 4.75% due 10/01/2027 (d) 5,745
Tampa, Florida, Sports Authority Revenue Bonds:
AAA Aaa 1,500 Refunding (County Interlocal Payments), 5% due 10/01/2028 (b) 1,495
AAA Aaa 2,500 (Sales Tax Payments--Stadium Project), 5.25% due 1/01/2027 (c) 2,559
==================================================================================================================================
Texas--1.8% A1+ NR* 2,200 Harris County, Texas, Health Facilities Development Corporation,
Hospital Revenue Bonds (Methodist Hospital), VRDN, 3.70% due
12/01/2025 (a) 2,200
==================================================================================================================================
Puerto Rico--3.1% A Baa1 4,000 Puerto Rico Commonwealth Highway and Transportation Authority,
Transportation Revenue Bonds, Series A, 5% due 7/01/2038 3,905
==================================================================================================================================
Total Investments (Cost--$127,554)--106.4% 132,894
Liabilities in Excess of Other Assets--(6.4%) (7,945)
--------
Net Assets--100.0% $124,949
========
==================================================================================================================================
</TABLE>
(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, 1998.
(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.
** Represents a zero coupon bond; the interest rate shown is the
effective yield at the time of purchase by the Fund.
+ Highest short-term rating by Moody's Investors Service, Inc.
Ratings of issues shown have not been audited by Deloitte & Touche LLP.
See Notes to Financial Statements.
Quality Profile
The quality ratings of securities in the Fund as of October 31, 1998 were as
follows:
- --------------------------------------------------------------------------------
Percent of
S&P Rating/Moody's Rating Net Assets
- --------------------------------------------------------------------------------
AAA/Aaa.............................................................. 70.3%
AA/Aa ............................................................... 13.2
A/A.................................................................. 8.0
BBB/Baa.............................................................. 6.3
Other+............................................................... 8.6
- --------------------------------------------------------------------------------
+ Temporary investments in short-term municipal securities.
6 & 7
<PAGE>
MuniVest Florida Fund, October 31, 1998
STATEMENT OF ASSETS, LIABILITIES AND CAPITAL
<TABLE>
<CAPTION>
As of October 31, 1998
==============================================================================================================================
<S> <C> <C> <C>
Assets: Investments, at value (identified cost--$127,553,548) (Note 1a) ............. $132,894,252
Cash ........................................................................ 39,957
Receivables:
Interest .................................................................. $ 1,610,500
Securities sold ........................................................... 45,000 1,655,500
------------
Prepaid expenses and other assets ........................................... 6,657
------------
Total assets ................................................................ 134,596,366
------------
==============================================================================================================================
Liabilities: Payables:
Securities purchased ...................................................... 9,485,909
Investment adviser (Note 2) ............................................... 55,103
Dividends to shareholders (Note 1f) ....................................... 46,767 9,587,779
------------
Accrued expenses and other liabilities ...................................... 59,774
------------
Total liabilities ........................................................... 9,647,553
------------
==============================================================================================================================
Net Assets: Net assets .................................................................. $124,948,813
============
==============================================================================================================================
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 (5,982,149 shares issued and
outstanding) .............................................................. $ 598,215
Paid-in capital in excess of par ............................................ 83,246,930
Undistributed investment income--net ........................................ 544,924
Accumulated realized capital losses on investments--net (Note 5) ............ (4,781,960)
Unrealized appreciation on investments--net ................................. 5,340,704
------------
Total--Equivalent to $14.20 net asset value per Common Share (market
price--$14.125) ............................................................. 84,948,813
------------
Total capital ............................................................... $124,948,813
============
==============================================================================================================================
</TABLE>
* Auction Market Preferred Shares.
See Notes to Financial Statements.
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
For the Year Ended October 31, 1998
==============================================================================================================================
<S> <C> <C> <C>
Investment Interest and amortization of premium and discount earned .................... $ 6,895,752
Income (Note 1d):
==============================================================================================================================
Expenses: Investment advisory fees (Note 2) ........................................... $ 618,817
Commission fees (Note 4) .................................................... 101,472
Professional fees ........................................................... 72,660
Accounting services (Note 2) ................................................ 39,393
Trustees' fees and expenses ................................................. 26,147
Transfer agent fees ......................................................... 24,641
Printing and shareholder reports ............................................ 20,353
Listing fees ................................................................ 15,856
Custodian fees .............................................................. 10,288
Pricing fees ................................................................ 7,090
Amortization of organization expenses (Note 1e) ............................. 2,642
Other ....................................................................... 12,728
------------
Total expenses .............................................................. 952,087
------------
Investment income--net ...................................................... 5,943,665
------------
==============================================================================================================================
Realized & Realized gain on investments--net ........................................... 3,590,397
Unrealized Gain Change in unrealized appreciation on investments--net ....................... (1,665,313)
(Loss) on ------------
Investments--Net Net Increase in Net Assets Resulting from Operations ........................ $ 7,868,749
(Notes 1b, 1d & 3): ============
==============================================================================================================================
</TABLE>
See Notes to Financial Statements.
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
For the Year Ended October 31,
------------------------------
Increase (Decrease) in Net Assets: 1998 1997
==============================================================================================================================
<S> <C> <C> <C>
Operations: Investment income--net ...................................................... $ 5,943,665 $ 6,012,077
Realized gain on investments--net ........................................... 3,590,397 1,216,839
Change in unrealized appreciation/depreciation on investments--net .......... (1,665,313) 1,616,148
------------ ------------
Net increase in net assets resulting from operations ........................ 7,868,749 8,845,064
------------ ------------
==============================================================================================================================
Dividends to Investment income--net:
Shareholders Common Shares ............................................................. (4,560,158) (4,635,108)
(Note 1f): Preferred Shares .......................................................... (1,326,560) (1,349,984)
------------ ------------
Net decrease in net assets resulting from dividends to shareholders ......... (5,886,718) (5,985,092)
------------ ------------
==============================================================================================================================
Beneficial Interest Value of shares issued to Common Shareholders in reinvestment of dividends .. 49,203 --
Transactions ------------ ------------
(Note 4):
==============================================================================================================================
Net Assets: Total increase in net assets ................................................ 2,031,234 2,859,972
Beginning of year ........................................................... 122,917,579 120,057,607
------------ ------------
End of year* ................................................................ $124,948,813 $122,917,579
============ ============
==============================================================================================================================
*Undistributed investment income--net ........................................ $ 544,924 $ 487,977
============ ============
==============================================================================================================================
</TABLE>
See Notes to Financial Statements.
8 & 9
<PAGE>
MuniVest Florida Fund, October 31, 1998
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
The following per share data and ratios have been derived
from information provided in the financial statements. For the Year Ended October 31,
-------------------------------------------
Increase (Decrease) in Net Asset Value: 1998 1997 1996 1995 1994
=================================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of year .............................. $ 13.87 $ 13.39 $ 13.16 $ 11.82 $ 14.99
Operating ------- ------- ------- ------- -------
Performance: Investment income--net .......................................... .99 1.01 .99 1.01 1.00
Realized and unrealized gain (loss) on investments--net ......... .32 .48 .23 1.34 (3.05)
------- ------- ------- ------- -------
Total from investment operations ................................ 1.31 1.49 1.22 2.35 (2.05)
------- ------- ------- ------- -------
Less dividends and distributions to Common Shareholders:
Investment income--net ........................................ (.76) (.78) (.76) (.76) (.84)
Realized gain on investments--net ............................. -- -- -- -- (.11)
------- ------- ------- ------- -------
Total dividends and distributions to Common Shareholders ........ (.76) (.78) (.76) (.76) (.95)
------- ------- ------- ------- -------
Effect of Preferred Share activity:
Dividends and distributions to Preferred Shareholders:
Investment income--net ...................................... (.22) (.23) (.23) (.25) (.15)
Realized gain on investments--net ........................... -- -- -- -- (.02)
------- ------- ------- ------- -------
Total effect of Preferred Share activity ........................ (.22) (.23) (.23) (.25) (.17)
------- ------- ------- ------- -------
Net asset value, end of year .................................... $ 14.20 $ 13.87 $ 13.39 $ 13.16 $ 11.82
======= ======= ======= ======= =======
Market price per share, end of year ............................. $14.125 $ 13.00 $ 12.75 $ 11.50 $ 10.00
======= ======= ======= ======= =======
=================================================================================================================================
Total Investment Based on market price per share ................................. 14.78% 8.21% 17.87% 22.93% (28.20%)
Return:* ======= ======= ======= ======= =======
Based on net asset value per share .............................. 8.16% 9.93% 8.17% 19.02% (15.07%)
======= ======= ======= ======= =======
=================================================================================================================================
Ratios to Average Expenses, net of reimbursement .................................. .77% .78% .82% .85% .75%
Net Assets:** ======= ======= ======= ======= =======
Expenses ........................................................ .77% .78% .82% .85% .78%
======= ======= ======= ======= =======
Investment income--net .......................................... 4.80% 4.96% 4.96% 5.38% 4.94%
======= ======= ======= ======= =======
=================================================================================================================================
Supplemental Net assets, net of Preferred Shares, end of year (in thousands).. $84,949 $82,918 $80,058 $78,695 $70,674
Data: ======= ======= ======= ======= =======
Preferred Shares outstanding, end of year (in thousands) ........ $40,000 $40,000 $40,000 $40,000 $40,000
======= ======= ======= ======= =======
Portfolio turnover .............................................. 92.75% 89.21% 116.82% 92.54% 100.98%
======= ======= ======= ======= =======
=================================================================================================================================
Leverage: Asset coverage per $1,000 ....................................... $ 3,124 $ 3,073 $ 3,001 $ 2,967 $ 2,767
======= ======= ======= ======= =======
=================================================================================================================================
Dividends Investment income--net .......................................... $ 829 $ 844 $ 861 $ 940 $ 569
Per Share on ======= ======= ======= ======= =======
Preferred Shares
Outstanding:+
=================================================================================================================================
</TABLE>
* 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.
+ Dividends per share have been adjusted to reflect a two-for-one
stock split that occurred on December 1, 1994.
See Notes to Financial Statements.
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 written or purchased are valued at the last
sale price in the case of exchange-traded options. In the case of options traded
in the over-the-counter market, valuation is the last asked price (options
written) or the last bid price (options purchased). Securities with remaining
maturities of sixty days or less are valued at amortized cost, which
approximates market value. Securities and assets 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.
o Financial futures contracts--The Fund may purchase or sell financial 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.
o 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 reg-
10 & 11
<PAGE>
MuniVest Florida Fund, October 31, 1998
NOTES TO FINANCIAL STATEMENTS (concluded)
ulated 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 period not exceeding five years.
(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, including
proceeds from the issuance of Preferred Shares.
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, 1998 were $111,836,787 and $112,260,791, respectively.
Net realized gains for the year ended October 31, 1998 and net unrealized gains
as of October 31, 1998 were as follows:
- --------------------------------------------------------------------------------
Realized Unrealized
Gains Gains
- --------------------------------------------------------------------------------
Long-term investments ......................... $3,590,397 $5,340,704
---------- ----------
Total ......................................... $3,590,397 $5,340,704
========== ==========
- --------------------------------------------------------------------------------
As of October 31, 1998, net unrealized appreciation for Federal income tax
purposes aggregated $5,339,077, of which $5,602,595 related to appreciated
securities and $263,518 related to depreciated securities. The aggregate cost of
investments at October 31, 1998 for Federal income tax purposes was
$127,555,175.
4. Beneficial Interest 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 beneficial interest without
approval of holders of Common Shares.
Common Shares
Shares issued and outstanding during the year ended October 31, 1998 increased
by 3,487 as a result of dividend reinvestment and during the year ended October
31, 1997 remained constant.
Preferred Shares
Auction Market Preferred Shares ("AMPS") are Preferred Shares of the Fund, with
a par value of $.05 per share and a liquidation preference of $25,000 per share,
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,
1998 was 3.35%.
Shares issued and outstanding during the years ended October 31, 1998 and
October 31, 1997 remained constant.
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, 1998, Merrill Lynch, Pierce, Fenner
& Smith Inc., an affiliate of FAM, earned $73,287 as commissions.
5. Capital Loss Carryforward:
At October 31, 1998, the Fund had a capital loss carryforward of approximately
$2,726,000, of which $472,000 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 5, 1998, the Fund's Board of Trustees declared an ordinary income
dividend to Common Shareholders in the amount of $.065566 per share, payable on
November 27, 1998 to shareholders of record as of November 20, 1998.
INDEPENDENT AUDITORS' 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, 1998, 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 five-year period then
ended. These financial statements and the financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and the financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and the financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned at October
31, 1998 by correspondence with the custodian and brokers. An audit also
includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of MuniVest Florida
Fund as of October 31, 1998, 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 4, 1998
12 & 13
<PAGE>
MuniVest Florida Fund, October 31, 1998
IMPORTANT TAX INFORMATION (unaudited)
All of the net investment income distributions paid by MuniVest Florida Fund
during its taxable year ended October 31, 1998 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.
MANAGED DIVIDEND POLICY
The Fund's dividend policy is to distribute substantially all of its net
investment income to its shareholders on a monthly basis. However, in order to
provide shareholders with a more consistent yield to the current trading price
of Common Shares of the Fund, the Fund may at times pay out less than the entire
amount of net investment income earned in any particular month and may at times
in any particular month pay out such accumulated but undistributed income in
addition to net investment income earned in that month. As a result, the
dividends paid by the Fund for any particular month may be more or less than the
amount of net investment income earned by the Fund during such month. The Fund's
current accumulated but undistributed net investment income, if any, is
disclosed in the Statement of Assets, Liabilities and Capital, which comprises
part of the financial information included in this report.
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
Fred G. Weiss, Trustee
Terry K. Glenn, Executive Vice President
Vincent R. Giordano, Senior Vice President
William R. Bock, Vice President
Donald C. Burke, 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
14 & 15
<PAGE>
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 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 #16636-10/98
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