<PAGE> 1
TABLE OF CONTENTS
<TABLE>
<S> <C>
Letter to Shareholders........................... 1
Performance Results.............................. 4
Portfolio of Investments......................... 5
Statement of Assets and Liabilities.............. 7
Statement of Operations.......................... 8
Statement of Changes in Net Assets............... 9
Financial Highlights............................. 10
Notes to Financial Statements.................... 11
</TABLE>
VOF SAR 6/96
<PAGE> 2
LETTER TO SHAREHOLDERS
May 15, 1996
Dear Shareholder,
While interest rates drifted
downward during the fourth quarter of
last year, such was not the case in the
first quarter of 1996. Early in the
quarter, municipal bond prices [PHOTO]
demonstrated increased volatility in
conjunction with February's economic
announcements, which revealed a revival
in economic growth, impressive
employment levels, and moderate
inflation. This positive economic DENNIS J. MCDONNELL AND DON G. POWELL
environment, however, did not translate
into positive movement for the bond markets. Instead, the markets became wary,
because inflation often accompanies economic growth.
Other factors influencing the municipal bond market early in the year
included:
- Intense weather conditions, which hindered distribution and manufacturing,
were experienced by much of the United States and affected certain
municipal bond sectors.
- The expectation that a federal budget agreement was forthcoming helped
bolster municipal bonds, especially at the longer end of the spectrum.
- The proposal of tax reform--and the threat of municipal bonds having
diminished tax-exempt status--continued to dampen demand for municipals,
resulting in lower bond prices.
We believe the beginning of 1996 reflected the market's reaction to the
possibility of a return to long-term economic growth. This, coupled with
continued low inflationary conditions, has served to put the Federal Reserve
Board in a neutral policy mode, bringing relative calm to the market--although
currently at higher interest rate levels.
PERFORMANCE SUMMARY
The Van Kampen American Capital Florida Municipal Opportunity Trust's
(ticker symbol VOF) common stock price was up 3 percent during the six-month
period, closing at $12.375, while the general municipal bond market was down 4
percent for the same period, according to the Bond Buyer's 40 Municipal Bond
Index.
For the six months ended April 30, 1996, the Trust achieved a total return
of 6.17 percent(1), based on market price. Longer term, the Trust achieved a
one-year total return of 16.81 percent(1), based on market price for the period
ended April 30, 1996, including reinvestment of dividends.
Continued on page two
1
<PAGE> 3
Many closed-end municipal bond funds are currently offering higher after-tax
yields than taxable income alternatives, and your Trust is no exception. Based
on the closing common stock price on April 30, 1996, the Florida Municipal
Opportunity Trust had a tax-exempt distribution rate of 5.92 percent (3). In
other words, Florida residents in the 36 percent combined marginal income tax
bracket would have to earn a yield of 9.25 percent(4) on a taxable investment to
equal your Trust's tax-exempt distribution rate.
MARKET OUTLOOK
The economy rebounded in the first quarter of 1996, despite poor weather in
the East and the remnants of a slow fourth quarter of 1995, which was hindered
by weak construction activity, two government shutdowns, and a strike at Boeing.
We believe the momentum of the first quarter can carry into the second, due in
part to renewed auto production in the aftermath of the General Motors strike
and an end to the budget stalemate between the White House and Congress. We
expect a modest slowdown in the summer months, as higher interest rates could
slow activity in interest-sensitive sectors of the economy, such as housing.
TOP 5 PORTFOLIO HOLDINGS BY INDUSTRY AS OF APRIL 30, 1996
Public Education........................................... 24.6%
Health Care................................................ 21.7%
Industrial Revenue......................................... 8.8%
Water & Sewer.............................................. 7.5%
Airport.................................................... 6.9%
The Fed's protracted period of easing, and relatively neutral stance, favors
the growth we are currently experiencing. Given the strong employment situation
and commodity price increases, we think the Fed will await further economic
evidence before adjusting interest rates again--probably summertime at the
earliest. So far, guides such as the Consumer Price Index continue to indicate
modest levels of inflation. More importantly, we continue to see few signs of
emerging inflation in either unit labor costs, hourly earnings or the employment
cost index.
- --------------------------------------------------------------------------------
INVESTMENT TERM: REVENUE BONDS
Revenue bonds are one of the three most common types of municipal bonds--the
other two are general obligation bonds and municipal notes. Revenue bonds
are issued to finance income-generating projects such as turnpikes, toll
bridges and airports. The revenues these projects bring in are used to pay
interest and principal to bondholders.
- --------------------------------------------------------------------------------
Continued on page three
2
<PAGE> 4
Finally, as the November elections approach, the debate on tax reform
may grow. We believe the outcome in the long run will be positive, or at worst
neutral, for municipal bonds. That's good news for the market, which was
concerned that flat tax proposals could threaten the tax-exempt status of
municipal bonds. While the debate may not be over and legislation may be
forthcoming, the market should be more confident.
Indeed, we expect investor demand for municipal securities to exceed supply,
which should add price stability to the general market. And with municipal bond
yields currently at attractive levels relative to Treasuries, investor demand
for tax-exempt securities should increase.
In summary, our view of the general municipal market is positive. From the
decreasing likelihood of tax reform in the near term to specific market
conditions, we believe the market is on solid ground. With our dedication to
comprehensive research and long-term investment perspective, we believe your
Trust is in a position to benefit in the coming months.
[CREDIT QUALITY GRAPH]
PORTFOLIO COMPOSITION BY CREDIT QUALITY
AS OF APRIL 30, 1996
<TABLE>
<S> <C>
AAA........... 86.1%
AA............ 6.8%
A............. 1.4%
BBB........... 5.7%
</TABLE>
BASED UPON CREDIT QUALITY RATINGS ISSUED BY STANDARD & POOR'S.
FOR SECURITIES NOT RATED BY STANDARD & POOR'S, THE MOODY'S RATING IS USED.
Sincerely,
[SIG]
Don G. Powell
Chairman
Van Kampen American Capital
Investment Advisory Corp.
[SIG]
Dennis J. McDonnell
President
Van Kampen American Capital
Investment Advisory Corp.
3
<PAGE> 5
PERFORMANCE RESULTS FOR THE PERIOD ENDED APRIL 30, 1996
VAN KAMPEN AMERICAN CAPITAL FLORIDA MUNICIPAL OPPORTUNITY TRUST
(AMEX TICKER SYMBOL--VOF)
<TABLE>
<S> <C>
COMMON SHARE TOTAL RETURNS
Six-month total return based on market price(1)........... 6.17%
Six-month total return based on NAV(2).................... (.19%)
DISTRIBUTION RATES
Distribution rate as a % of closing common stock
price(3)................................................ 5.92%
Taxable-equivalent distribution rate as a % of closing
common stock price(4)................................... 9.25%
SHARE VALUATIONS
Net asset value........................................... $ 13.64
Closing common stock price................................ $12.375
Six-month high common stock price (02/06/96).............. $13.125
Six-month low common stock price (11/03/95)............... $11.750
Preferred share rate(5)................................... 3.850%
</TABLE>
(1) Total return based on market price assumes an investment at the market price
at the beginning of the period indicated, reinvestment of all distributions for
the period in accordance with the Trust's dividend reinvestment plan, and sale
of all shares at the closing common stock price at the end of the period
indicated.
(2) Total return based on net asset value (NAV) assumes an investment at the
beginning of the period indicated, reinvestment of all distributions for the
period, and sale of all shares at the end of the period, all at NAV.
(3) Distribution rate represents the monthly annualized distributions of the
Trust at the end of the period and not the earnings of the Trust.
(4) The taxable-equivalent distribution rate is calculated assuming a 36%
federal income tax bracket.
(5) See "Notes to Financial Statements" footnote #4, for more information
concerning Preferred Share reset periods.
A portion of the interest income may be taxable for those investors subject to
the federal alternative minimum tax (AMT).
Past performance does not guarantee future results. Investment return, stock
price and net asset value will fluctuate with market conditions. Trust shares,
when sold, may be worth more or less than their original cost.
4
<PAGE> 6
PORTFOLIO OF INVESTMENTS
April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par
Amount
(000) Description Coupon Maturity Market Value
- -----------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS
FLORIDA 94.1%
$ 1,000 Altamonte Springs, FL Hlth Fac Auth Hosp Rev
Adventist Hlth Sunbelt Ser B (AMBAC Insd)....... 5.375% 11/15/23 $ 913,120
1,000 Bay Cnty, FL Sch Brd Ctfs Partn (AMBAC Insd).... 6.750 07/01/12 1,084,110
1,750 Broward Cnty, FL Edl Fac Auth Rev Nova
Southeastn Univ Proj (Connie Lee Insd).......... 5.875 04/01/07 1,794,853
750 Clay Cnty, FL Hsg Fin Auth Rev Single Family Mtg
(GNMA Collateralized)........................... 6.500 09/01/21 752,805
1,600 Dade Cnty, FL Aviation Rev Ser B (MBIA Insd).... 5.750 10/01/13 1,592,080
1,000 Dade Cnty, FL Aviation Rev Ser C (MBIA Insd).... 5.500 10/01/04 1,035,710
1,750 Dade Cnty, FL Sch Brd Ctfs Partn Ser A (MBIA
Insd)........................................... 5.750 05/01/08 1,796,182
1,000 Escambia Cnty, FL Pollutn Ctl Rev Champion Intl
Corp Proj....................................... 6.900 08/01/22 1,046,990
235 Florida Hsg Fin Agy Hsg Brittany Rosemont Ser G1
(AMBAC Insd).................................... 6.150 07/01/25 235,364
350 Florida Hsg Fin Agy Hsg Brittany Rosemont Ser G1
(AMBAC Insd).................................... 6.250 07/01/35 350,536
1,235 Florida St Brd Edl Cap Outlay Pub Edl Ser C
(MBIA Insd)..................................... 5.600 06/01/25 1,184,526
1,300 Florida St Brd Edl Cap Outlay Pub Edl Ser C
(Prerefunded @ 06/01/02)........................ 6.625 06/01/22 1,441,219
500 Gainesville, FL Utils Sys Rev................... 8.125 10/01/14 595,715
2,000 Hillsborough Cnty, FL Cap Impt Pgm Rev Criminal
Justice Fac Rfdg (FGIC Insd).................... 5.250 08/01/16 1,857,360
1,650 Hillsborough Cnty, FL Hosp Auth Hosp Rev Tampa
Genl Hosp Proj Rfdg (FSA Insd).................. 6.375 10/01/13 1,709,615
1,750 Hillsborough Cnty, FL Indl Dev Auth Indl Dev Rev
Univ Cmnty Hosp (MBIA Insd)..................... 5.750 08/15/14 1,725,500
1,500 Hillsborough Cnty, FL Indl Dev Auth Pollutn Ctl
Rev Tampa Elec Co Proj Rfdg (MBIA Insd)......... 6.250 12/01/34 1,542,585
1,000 Hillsborough Cnty, FL Indl Dev Auth Pollutn Ctl
Rev Tampa Elec Co Proj Ser 92 Rfdg.............. 8.000 05/01/22 1,170,970
1,750 Hillsborough Cnty, FL Indl Dev Auth Rev Allegany
Hlth Sys J Knox Village (MBIA Insd)............. 6.000 12/01/06 1,837,307
1,740 Hillsborough Cnty, FL Sch Brd Ctfs Partn (MBIA
Insd)........................................... 6.000 07/01/12 1,769,632
1,000 Jacksonville, FL Hosp Rev Univ Med Cent Inc Proj
(Connie Lee Insd)............................... 6.500 02/01/11 1,057,480
1,000 Martin Cnty, FL Indl Dev Auth Indl Dev Rev
Indiantown Cogeneration Proj A Rfdg............. 7.875 12/15/25 1,121,800
1,000 Okeechobee, FL Wtr & Swr Rev Ser A (Prerefunded
@ 01/01/03) (MBIA Insd)......................... 6.500 01/01/17 1,110,840
995 Orange Cnty, FL Hlth Fac Auth Rev Pooled Hosp Ln
Ser B Rfdg (BIGI Insd).......................... 7.875 12/01/25 1,045,456
</TABLE>
See Notes to Financial Statements
5
<PAGE> 7
PORTFOLIO OF INVESTMENTS (CONTINUED)
April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par
Amount
(000) Description Coupon Maturity Market Value
- -----------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
FLORIDA (CONTINUED)
$ 1,000 Orange Cnty, FL Hsg Fin Auth Single Family Mtg
Rev (GNMA Collateralized)....................... 6.550% 10/01/21 $ 1,016,300
1,000 Orange Cnty, FL Tourist Dev Tax Rev Ser B (AMBAC
Insd)........................................... 6.500 10/01/19 1,055,240
1,000 Palm Beach Cnty, FL Sch Brd Ctfs Partn Ser A
(AMBAC Insd).................................... 6.000 08/01/06 1,062,980
1,200 Polk Cnty, FL Sch Brd Ctfs Partn (FSA Insd)..... 5.000 01/01/14 1,078,116
1,000 Saint Petersburg, FL Excise Tax Rev Rfdg (FGIC
Insd)........................................... 5.000 10/01/16 898,870
705 Titusville, FL Wtr & Swr Rev (MBIA Insd)........ 5.800 10/01/08 733,658
1,000 Village Cent Cmnty Dev Dist FL Util Rev (FGIC
Insd)........................................... 6.000 11/01/18 1,031,980
-----------
36,648,899
-----------
PUERTO RICO 4.0%
500 Puerto Rico Comwlth Hwy & Tran Auth Hwy Rev Ser
V Rfdg.......................................... 6.375 07/01/08 524,575
1,000 Puerto Rico Comwlth Hwy & Tran Ser Y (Embedded
Cap) (FSA Insd) (b)............................. 5.730 07/01/21 1,057,260
-----------
1,581,835
-----------
TOTAL LONG-TERM INVESTMENTS 98.1%
(Cost $37,079,346) (a)........................................................... 38,230,734
OTHER ASSETS IN EXCESS OF LIABILITIES 1.9%....................................... 723,580
-----------
NET ASSETS 100%.................................................................. $38,954,314
==========
</TABLE>
(a) At April 30, 1996, cost for federal income tax purposes is $37,079,346; the
aggregate gross unrealized appreciation is $1,243,047 and the aggregate
gross unrealized depreciation is $91,659, resulting in net unrealized
appreciation of $1,151,388.
(b) An Embedded Cap security includes a cap strike level such that the coupon
payment may be supplemented by cap payments if the floating rate index upon
which the cap is based rises above the strike level. The price of these
securities may be more volatile than the price of a comparable fixed rate
security. The Trust invests in these instruments as a hedge against a rise
in the short term interest rates which it pays on its preferred shares.
See Notes to Financial Statements
6
<PAGE> 8
STATEMENT OF ASSETS AND LIABILITIES
April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments, at Market Value (Cost $37,079,346) (Note 1)................ $38,230,734
Cash.................................................................... 222,348
Interest Receivable..................................................... 652,255
Unamortized Organizational Expenses (Note 1)............................ 11,228
Other................................................................... 1,099
-----------
Total Assets...................................................... 39,117,664
-----------
LIABILITIES:
Payables:
Income Distributions -- Common and Preferred Shares................... 16,598
Administrative Fee (Note 2)........................................... 6,386
Accrued Expenses........................................................ 102,297
Deferred Compensation and Retirement Plans (Note 2)..................... 38,069
-----------
Total Liabilities................................................. 163,350
-----------
NET ASSETS.............................................................. $38,954,314
===========
NET ASSETS CONSIST OF:
Preferred Shares ($.01 par value, authorized 100,000,000 shares, 320
issued with liquidation preference of $50,000 per share) (Note 4)..... $16,000,000
-----------
Common Shares ($.01 par value with an unlimited number of shares
authorized, 1,683,270 shares issued and outstanding).................. 16,833
Paid in Surplus......................................................... 24,681,474
Net Unrealized Appreciation on Investments.............................. 1,151,388
Accumulated Undistributed Net Investment Income......................... 281,461
Accumulated Net Realized Loss on Investments............................ (3,176,842)
-----------
Net Assets Applicable to Common Shares............................ 22,954,314
-----------
NET ASSETS.............................................................. $38,954,314
===========
NET ASSET VALUE PER COMMON SHARE ($22,954,314 divided
by 1,683,270 shares outstanding)...................................... $ 13.64
===========
</TABLE>
See Notes to Financial Statements
7
<PAGE> 9
STATEMENT OF OPERATIONS
For the Six Months Ended April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest................................................................ $ 1,143,779
-----------
EXPENSES:
Investment Advisory Fee (Note 2)........................................ 129,140
Administrative Fee (Note 2)............................................. 39,735
Preferred Share Maintenance (Note 4).................................... 32,525
Audit................................................................... 17,290
Custody................................................................. 12,914
Shareholder Services.................................................... 11,722
Trustees Fees and Expenses (Note 2)..................................... 11,361
Printing................................................................ 10,374
Legal (Note 2).......................................................... 7,462
Amortization of Organizational Expenses (Note 1)........................ 2,492
Other................................................................... 7,265
-----------
Total Expenses...................................................... 282,280
Less Fees Deferred.................................................. 129,140
-----------
Net Expenses........................................................ 153,140
-----------
NET INVESTMENT INCOME................................................... $ 990,639
===========
REALIZED AND UNREALIZED GAIN/LOSS ON INVESTMENTS:
Realized Gain/Loss on Investments:
Proceeds from Sales................................................... $ 3,188,020
Cost of Securities Sold............................................... (3,267,635)
-----------
Net Realized Loss on Investments........................................ (79,615)
-----------
Unrealized Appreciation/Depreciation on Investments:
Beginning of the Period............................................... 1,838,607
End of the Period..................................................... 1,151,388
-----------
Net Unrealized Depreciation on Investments During the Period............ (687,219)
-----------
NET REALIZED AND UNREALIZED LOSS ON INVESTMENTS......................... $ (766,834)
===========
NET INCREASE IN NET ASSETS FROM OPERATIONS.............................. $ 223,805
===========
</TABLE>
See Notes to Financial Statements
8
<PAGE> 10
STATEMENT OF CHANGES IN NET ASSETS
For the Six Months Ended April 30, 1996
and the Year Ended October 31, 1995 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Ended Year Ended
April 30, 1996 October 31, 1995
- ------------------------------------------------------------------------------------------
<S> <C> <C>
FROM INVESTMENT ACTIVITIES:
Operations:
Net Investment Income.............................. $ 990,639 $ 1,958,301
Net Realized Loss on Investments................... (79,615) (193,643)
Net Unrealized Appreciation/Depreciation on
Investments During the Period.................... (687,219) 3,867,027
----------- -----------
Change in Net Assets from Operations............... 223,805 5,631,685
----------- -----------
Distributions from Net Investment Income:
Common Shares.................................... (616,054) (1,232,123)
Preferred Shares................................. (260,943) (619,221)
----------- -----------
Total Distributions................................ (876,997) (1,851,344)
----------- -----------
NET CHANGE IN NET ASSETS FROM INVESTMENT
ACTIVITIES....................................... (653,192) 3,780,341
----------- -----------
FROM CAPITAL TRANSACTIONS:
Recapture of Excess Offering Costs................. -0- 73,188
----------- -----------
NET CHANGE IN NET ASSETS FROM CAPITAL
TRANSACTIONS..................................... -0- 73,188
----------- -----------
TOTAL INCREASE/DECREASE IN NET ASSETS.............. (653,192) 3,853,529
NET ASSETS:
Beginning of the Period............................ 39,607,506 35,753,977
----------- -----------
End of the Period (Including undistributed net
investment income of $281,461 and $167,819,
respectively).................................... $38,954,314 $39,607,506
=========== ===========
</TABLE>
See Notes to Financial Statements
9
<PAGE> 11
FINANCIAL HIGHLIGHTS
The following schedule presents financial highlights for one common share
of the Trust outstanding throughout the periods indicated. (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
July 30, 1993
Six Months Year Year (Commencement
Ended Ended Ended of Investment
April 30, October 31, October 31, Operations) to
1996 1995 1994 October 31, 1993
<S> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------
Net Asset Value, Beginning of the
Period (a)...................... $14.024 $11.735 $14.888 $14.628
------- ------- ------- -------
Net Investment Income........... .588 1.163 1.050 .091
Net Realized and Unrealized
Gain/Loss on Investments...... (.454) 2.226 (3.180) .251
------- ------- ------- -------
Total from Investment
Operations...................... .134 3.389 (2.130) .342
------- ------- ------- -------
Less Distributions from Net
Investment Income:
Paid to Common Shareholders... .366 .732 .787 .066
Common Share Equivalent of
Distributions Paid to
Preferred Shareholders...... .155 .368 .236 .016
------- ------- ------- -------
Total Distributions............... .521 1.100 1.023 .082
------- ------- ------- -------
Net Asset Value, End of the
Period.......................... $13.637 $14.024 $11.735 $14.888
======= ======= ======= =======
Market Price Per Share at End of
the Period...................... $12.375 $12.000 $9.750 $14.875
Total Investment Return at Market
Price (b)....................... 6.17%* 31.16% (30.20%) (.40%)*
Total Return at Net Asset Value
(c)............................. (.19%)* 26.30% (16.27%) (.36%)*
Net Assets at End of the Period
(In millions)................... $39.0 $39.6 $35.8 $41.0
Ratio of Expenses to Average Net
Assets Applicable to Common
Shares**........................ 1.28% 1.37% 1.49% 2.59%
Ratio of Expenses to Average Net
Assets**........................ .77% .79% .87% 2.16%
Ratio of Net Investment Income to
Average Net Assets Applicable to
Common Shares** (d)............. 6.09% 6.13% 6.06% 2.10%
Portfolio Turnover................ 8.36%* 24.03% 100.85% -0-
</TABLE>
* Non-Annualized
** If certain expenses had not been assumed by the Adviser, total return would
have been lower and the ratios would have been as follows:
<TABLE>
<S> <C> <C> <C> <C>
Ratio of Expenses to Average Net
Assets Applicable to Common
Shares.......................... 2.36% 2.49% 2.50% N/A
Ratio of Expenses to Average Net
Assets.......................... 1.41% 1.44% 1.46% N/A
Ratio of Net Investment Income to
Average Net Assets Applicable to
Common Shares (d)............... 5.01% 5.00% 5.05% N/A
</TABLE>
(a) Net asset value at July 30, 1993, is adjusted for common and preferred share
offering costs of $.372 per common share.
(b) Total investment return at market price reflects the change in market value
of the common shares for the period indicated with reinvestment of dividends
in accordance with the Trust's dividend reinvestment plan.
(c) Total return at net asset value (NAV) reflects the change in value of the
Trust's assets with reinvestment of dividends based on NAV.
(d) Net investment income is adjusted for the common share equivalent of
distributions paid to preferred shareholders.
N/A = Not Applicable
See Notes to Financial Statements
10
<PAGE> 12
NOTES TO FINANCIAL STATEMENTS
April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
Van Kampen American Capital Florida Municipal Opportunity Trust (the "Trust") is
registered as a non-diversified closed-end management investment company under
the Investment Company Act of 1940, as amended. The Trust's investment objective
is to provide a high level of current income exempt from federal income taxes
and Florida State intangible taxes, consistent with preservation of capital. The
Trust will invest in a portfolio consisting substantially of Florida municipal
obligations rated investment grade at the time of investment. The Trust
commenced investment operations on July 30, 1993.
The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
A. SECURITY VALUATION--Investments are stated at value using market quotations
or, if such valuations are not available, estimates obtained from yield data
relating to instruments or securities with similar characteristics in accordance
with procedures established in good faith by the Board of Trustees. Short-term
securities with remaining maturities of less than 60 days are valued at
amortized cost.
B. SECURITY TRANSACTIONS--Security transactions are recorded on a trade date
basis. Realized gains and losses are determined on an identified cost basis. The
Trust may purchase and sell securities on a "when issued" or "delayed delivery"
basis with settlement to occur at a later date. The value of the security so
purchased is subject to market fluctuations during this period. The Trust will
maintain, in a segregated account with its custodian, assets having an aggregate
value at least equal to the amount of the when issued or delayed delivery
purchase commitments until payment is made. At April 30, 1996, there were no
when issued or delayed delivery purchase commitments.
C. INVESTMENT INCOME--Interest income is recorded on an accrual basis. Bond
premium and original issue discount are amortized over the expected life of each
applicable security.
11
<PAGE> 13
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
D. ORGANIZATIONAL EXPENSES--The Trust has reimbursed Van Kampen American Capital
Distributors Inc. or its affiliates (collectively "VKAC") for costs incurred in
connection with the Trust's organization in the amount of $25,000. These costs
are being amortized on a straight line basis over the 60 month period ending
July 29, 1998. Van Kampen American Capital Investment Advisory Corp. (the
"Adviser") has agreed that in the event any of the initial shares of the Trust
originally purchased by VKAC are redeemed during the amortization period, the
Trust will be reimbursed for any unamortized organizational expenses in the same
proportion as the number of shares redeemed bears to the number of initial
shares held at the time of redemption.
E. FEDERAL INCOME TAXES--It is the Trust'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 provision for federal income taxes is required.
The Trust intends to utilize provisions of the federal income tax laws which
allow it to carry a realized capital loss forward for eight years following the
year of the loss and offset such losses against any future realized capital
gains. At October 31, 1995, the Trust had an accumulated capital loss
carryforward for tax purposes of $3,097,227, of which $2,903,584 and $193,643
will expire on October 31, 2002 and 2003, respectively.
F. DISTRIBUTION OF INCOME AND GAINS--The Trust declares and pays dividends from
net investment income to common shareholders monthly. Net realized gains, if
any, are distributed annually on a pro rata basis to common and preferred
shareholders. Distributions from net realized gains for book purposes may
include short-term capital gains, which are included as ordinary income for tax
purposes.
2. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES
Under the terms of the Trust's Investment Advisory Agreement, the Adviser will
provide investment advice and facilities to the Trust for an annual fee payable
monthly of .65% of the average net assets of the Trust. In addition, the Trust
will pay a monthly administrative fee to VKAC, the Trust's Administrator, at an
annual rate of .20% of the average net assets of the Trust. The administrative
services provided by the Administrator include record keeping and reporting
responsibilities with respect to the Trust's portfolio and preferred shares and
providing certain services to shareholders.
12
<PAGE> 14
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
Certain legal expenses are paid to Skadden, Arps, Slate, Meagher & Flom,
counsel to the Trust, of which a trustee of the Trust is an affiliated person.
For the six months ended April 30, 1996, the Trust recognized expenses of
approximately $5,500 representing VKAC's cost of providing accounting and legal
services to the Trust.
Certain officers and trustees of the Trust are also officers and directors
of VKAC. The Trust does not compensate its officers or trustees who are officers
of VKAC.
The Trust has implemented deferred compensation and retirement plans for its
Trustees. Under the deferred compensation plan, Trustees may elect to defer all
or a portion of their compensation to a later date. The retirement plan covers
those Trustees who are not officers of VKAC.
At April 30, 1996, VKAC owned 6,700 common shares of the Trust.
3. INVESTMENT TRANSACTIONS
Aggregate purchases and cost of sales of investment securities, excluding
short-term notes, for the six months ended April 30, 1996, were $3,615,047 and
$3,267,635, respectively.
4. PREFERRED SHARES
The Trust has outstanding 320 Auction Preferred Shares ("APS"). Dividends are
cumulative and the dividend rate is currently reset every seven days through an
auction process. The rate in effect on April 30, 1996 was 3.85%. During the six
months ended April 30, 1996, the rates ranged from .10% to 3.90%.
The Trust pays annual fees equivalent to .25% of the preferred share
liquidation value for the remarketing efforts associated with the preferred
auctions. These fees are included as a component of Preferred Share Maintenance
expense.
The APS are redeemable at the option of the Trust in whole or in part at the
liquidation value of $50,000 per share plus accumulated and unpaid dividends.
The Trust is subject to certain asset coverage tests and the APS are subject to
mandatory redemption if the tests are not met.
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FUNDS DISTRIBUTED BY VAN KAMPEN AMERICAN CAPITAL
GLOBAL AND
INTERNATIONAL
Global Equity Fund
Global Government Securities Fund
Global Managed Assets Fund
Short-Term Global Income Fund
Strategic Income Fund
EQUITY
Growth
Aggressive Growth Fund
Emerging Growth Fund
Enterprise Fund
Pace Fund
Growth & Income
Balanced Fund
Comstock Fund
Equity Income Fund
Growth and Income Fund
Harbor Fund
Real Estate Securities Fund
Utility Fund
FIXED INCOME
Corporate Bond Fund
Government Securities Fund
High Income Corporate Bond Fund
High Yield Fund
Limited Maturity Government Fund
Prime Rate Income Trust
Reserve Fund
U.S. Government Fund
U.S. Government Trust for Income
TAX-FREE
California Insured Tax Free Fund
Florida Insured Tax Free
Income Fund
High Yield Municipal Fund
Insured Tax Free Income Fund
Intermediate Term Municipal
Income Fund
Municipal Income Fund
New Jersey Tax Free Income Fund
New York Tax Free Income Fund
Pennsylvania Tax Free Income Fund
Tax Free High Income Fund
Tax Free Money Fund
Texas Tax Free Income Fund
THE GOVETT FUNDS
Emerging Markets Fund
Global Income Fund
International Equity Fund
Latin America Fund
Pacific Strategy Fund
Smaller Companies Fund
Ask your investment representative for a prospectus containing more complete
information, including sales charges and expenses. Please read it carefully
before you invest or send money. Or call us direct at 1-800-341-2911 weekdays
from 7:00 a.m. to 7:00 p.m. Central time.
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VAN KAMPEN AMERICAN CAPITAL FLORIDA MUNICIPAL OPPORTUNITY TRUST
OFFICERS AND TRUSTEES
DON G. POWELL*
Chairman and Trustee
DENNIS J. MCDONNELL*
President and Trustee
DAVID C. ARCH
Trustee
ROD DAMMEYER
Trustee
HOWARD J KERR
Trustee
THEODORE A. MYERS
Trustee
HUGO F. SONNENSCHEIN
Trustee
WAYNE W. WHALEN*
Trustee
PETER W. HEGEL*
Vice President
RONALD A. NYBERG*
Vice President and Secretary
EDWARD C. WOOD, III*
Vice President and Treasurer
SCOTT E. MARTIN*
Assistant Secretary
WESTON B. WETHERELL*
Assistant Secretary
NICHOLAS DALMASO*
Assistant Secretary
JOHN L. SULLIVAN*
Controller
STEVEN M. HILL*
Assistant Treasurer
INVESTMENT ADVISER
VAN KAMPEN AMERICAN CAPITAL
INVESTMENT ADVISORY CORP.
One Parkview Plaza
Oakbrook Terrace, Illinois 60181
CUSTODIAN AND TRANSFER AGENT
STATE STREET BANK
AND TRUST COMPANY
225 Franklin Street
P.O. Box 1713
Boston, Massachusetts 02105
LEGAL COUNSEL
SKADDEN, ARPS, SLATE,
MEAGHER & FLOM
333 West Wacker Drive
Chicago, Illinois 60606
INDEPENDENT AUDITORS
KPMG PEAT MARWICK LLP
Peat Marwick Plaza
303 East Wacker Drive
Chicago, Illinois 60601
* "Interested" persons of the Trust, as defined in the Investment Company
Act of 1940.
(C) Van Kampen American Capital Distributors, Inc., 1996
All rights reserved.
(SM) denotes a service mark of Van Kampen American Capital Distributors, Inc.
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VAN KAMPEN AMERICAN CAPITAL FLORIDA MUNICIPAL OPPORTUNITY TRUST FUND
THIS PAGE INTENTIONALLY LEFT BLANK
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