<PAGE>
===============================================================================
W.P. STEWART & CO. GROWTH FUND, INC.
===============================================================================
Annual Report
December 31, 1997
<PAGE>
- -------------------------------------------------------------------------------
W.P. Stewart & Co. Growth Fund, Inc.
Annual Report as of December 31, 1997
- -------------------------------------------------------------------------------
Management Comments
Review of the Year
During the past year, the Fund's net asset value per share increased from
$152.65 on December 31, 1996 to $168.71 on December 31, 1997, after giving
effect to a distribution of $20.60 per share. This represents a total investment
return of 25%.
The Fund's shares benefited from continuing good earnings from our companies in
a positive economic environment. Our portfolio's earnings grew at a rate of over
20% during the year, which made these shares very attractive to investors in an
interest rate environment of below 6%. Further, our companies met or exceeded
their earnings targets in almost all cases. Consequently we saw upward movement
in the P/E ratios of these holdings.
The Fund was minimally exposed to the Asian crisis. Fund holdings are either
companies who sell only in the U.S. and Europe, or who have only a moderate
amount of their sales and earnings exposed to demand from Asian markets. The
strength of the dollar was a factor for a number of our companies, but the
effect was somewhat mitigated by their currency management programs.
Long-term View
The U.S. economic environment we have been experiencing for the past three years
has been extraordinarily favorable to investments in equities. However, in 1998
we expect this environment to selectively favor certain equity investments. The
U.S. economy is finally slowing and, as a result, it will become more difficult
for cyclical businesses to deliver impressive returns. Further, inflation in the
U.S. and globally is being kept to very low levels, and therefore a lack of
pricing power will make it difficult for companies who do not have strong unit
growth at the top line to continue to deliver strong earnings per share.
Companies in industrial America have been cost-cutting for years, and those
without strong top line growth will find it ever more difficult to deliver
productivity improvements to the bottom line, again jeopardizing strong eps
performance.
It is in this kind of more challenging environment that the companies in the
Fund's portfolio will be especially appreciated. Unaffected by swings in the
economic climate because the demand for their goods and services is relatively
constant, modestly affected by low inflation because their top line growth is so
strong, dominant in their market areas so that upstart competitors or low priced
imports cannot affect their business success easily, having global opportunity
so that currency issues can be balanced, our Fund's companies are expected to
continue to deliver good mid-teens earning growth to shareholders. In fact these
Fund investments have an anticipated average earnings per share growth rate for
the next five years of +17% which means that shareholder profits should more
than double in that time period. We believe that there will be significant
upward reevaluation of the Fund's very carefully selected growth shares as a
result of their ability to deliver such predictable, substantial earnings in an
environment of slowing corporate profits.
There also continues to be substantial money available globally for investment.
Investors from around the world have been disappointed in emerging market
performance and they continue to see a substantial and persisting economic cloud
over Asia. More recently, concerns over European social and economic problems,
such as unemployment, have raised concerns over the strength of growth prospects
in the major European countries. If you add in the low interest rates
1
<PAGE>
- -------------------------------------------------------------------------------
W.P. Stewart & Co. Growth Fund, Inc.
Annual Report as of December 31, 1997
- -------------------------------------------------------------------------------
Management Comments (Continued)
around the world, investing in the U.S. in stocks such as those in the Fund's
portfolio has become a very attractive option for investors.
We therefore continue to be quite optimistic about the Fund's relative and
absolute performance in the year ahead. We look forward to reporting to you
again in July.
New York, N.Y.
February 9, 1998
Marilyn G. Breslow
W. P. Stewart & Co., Inc.
Investment Manager
2
<PAGE>
W.P. Stewart & Co. Growth Fund, Inc.
Comparison of a Hypothetical $100,000 Investment
W.P. Stewart & Co. Growth Fund vs. S&P 500*
[GRAPHIC OMITTED]
* For the period from February 28, 1994,
(commencement of investment operations) through
December 31, 1997.
<TABLE>
<CAPTION>
Total Investment Return*
February 28, 1994 - December 31, 1997
=============================================
<S> <C>
W.P. Stewart & Co. Growth Fund 110.38%
W.P. Stewart & Co. Growth Fund, Net 108.28%
S&P 500 127.25%
</TABLE>
* Total investment return is calculated assuming reinvestment of all
dividends and distributions at net asset value during the period. The W.P.
Stewart & Co. Growth Fund, Net, reflects the effect of a redemption fee on the
total return. S&P 500 return assumes no transaction costs.
3
<PAGE>
W.P. Stewart & Co. Growth Fund, Inc.
Schedule Of Investments
December 31, 1997
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Name of Issuer Market
and Title of Issue Shares Value
- --------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS--98.4%
Banks--2.3%
Northern Trust Corporation ................. 12,000 $ 837,000
---------
Chemicals--2.7%
Monsanto Company ........................... 23,000 966,000
---------
Commercial Services--7.7%
Cendant Corporation (a) .................... 81,000 2,784,375
---------
Data Processing Services--14.4%
Automatic Data Processing, Incorporated .... 57,000 3,498,375
First Data Corporation ..................... 59,000 1,725,750
---------
5,224,125
---------
Drugs & Health Care--12.1%
Johnson & Johnson .......................... 18,500 1,218,687
Pfizer Incorporated ........................ 29,200 2,177,225
Stryker Corporation ........................ 26,000 968,500
---------
4,364,412
---------
Electrical Equipment--4.5%
General Electric Company ................... 22,000 1,614,250
---------
Electronics--8.2%
Intel Corporation .......................... 42,000 2,950,500
---------
Environmental Services--5.O%
Rentokil Group PLC, ADR .................... 40,800 1,805,857
---------
Finance & Banking--2.O%
State Street Corporation ................... 12,500 727,344
---------
Food & Beverage--4.3%
Coca Cola Company .......................... 23,500 1,565,688
---------
Household Products--10.0%
Gillette Company ........................... 24,000 2,410,500
Procter & Gamble Company ................... 15,000 1,197,187
---------
3,607,687
Leisure Time--4.8%
Walt Disney Company ........................ 17,700 1,753,406
---------
Network Software--3.1 %
Cisco Systems, Incorporated (a) ............ 20,250 1,128,938
---------
Retail--12.6%
Autozone Incorporated (a) .................. 42,000 1,218,000
CVS Corporation ............................ 10,500 672,656
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
W.P. Stewart & Co. Growth Fund, Inc.
Schedule of Investments
December 31, 1997 (Continued)
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Name of Issuer Market
and Title of Issue Shares Value
- --------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS (Continued)
Retail--12.6% (Continued)
Dollar General Corporation ................. 52,900 $ 1,917,625
Walgreen Corporation ....................... 24,400 765,550
-----------
4,573,831
-----------
Software--4.7%
Microsoft Corporation (a) .................. 13,200 1,706,100
-----------
TOTAL COMMON STOCKS-(Cost $29,172,869) 35,609,513
-----------
SHORT TERM INVESTMENTS--O.9%
Repurchase Agreement--O.9%
State Street Bank & Trust Company, 2.00%,
01/02/98 dated 12/31/97 to be
repurchased at $ 326,036 on 01/02/98,
(collateralized by $290,000 par value U.S.
Treasury Notes, 7.125%, due 02/15/23, with a
value of $337,080) ......................... 326,000 326,000
-----------
TOTAL SHORT TERM INVESTMENTS-(Cost $326,000) 326,000
-----------
Total Investments--(Cost $29,498,869)--99.3% 35,935,513
Other Assets Less Liabilities--0.7% 265,893
-----------
Net Assets--100.00% $36,201,406
===========
</TABLE>
(a) No dividends paid on security.
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
W.P. Stewart & Co. Growth Fund, Inc.
Statement of Assets and Liabilities
December 31, 1997
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
Assets:
Investments in securities, at market value
(identified cost $29,498,869) ............................... $35,935,513
Receivable for securities sold ................................. 379,258
Cash ........................................................... 139
Dividends and interest receivable .............................. 22,230
Receivable due from Adviser .................................... 4,267
Receivable for Fund shares sold ................................ 25,902
Other assets ................................................... 1,675
-----------
Total Assets ................................................ 36,368,984
-----------
Liabilities:
Advisory fee payable ........................................... 118,143
Other accrued expenses ......................................... 49,435
-----------
Total Liabilities ........................................... 167,578
-----------
Net Assets ..................................................... $36,201,406
===========
Net assets consist of:
Capital stock, $0.001 par value; 100,000,000 shares
authorized, 214,581 shares issued and outstanding ........... $ 215
Capital paid in excess of par .................................. 29,579,482
Accumulated realized gain on investments - net ................. 185,065
Unrealized appreciation on investments - net ................... 6,436,644
-----------
Net Assets ..................................................... $36,201,406
===========
Net asset value per share ...................................... $ 168.71
===========
Redemption price per share ..................................... $ 167.86
===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
6
<PAGE>
W.P. Stewart & Co. Growth Fund, Inc.
Statement of Operations
Year Ended December 31, 1997
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
Investment Income:
Dividends (net of foreign withholding tax of $3,998) .......... $ 208,073
Interest ...................................................... 25,240
-----------
233,313
-----------
Expenses:
Investment advisory fees ...................................... 450,518
Administrative fees ........................................... 77,353
Custodian fees ................................................ 49,198
Transfer agent fees ........................................... 36,478
Registration fees ............................................. 21,998
Miscellaneous fees ............................................ 4,201
-----------
Total expenses before reimbursement ........................ 639,746
-----------
Expenses reimbursed by the Adviser ......................... (4,636)
-----------
Expenses, net of reimbursement ............................. 635,110
-----------
Net investment loss ........................................... (401,797)
-----------
Realized and Unrealized Gain on Investments:
Net realized gain on investments .............................. 4,077,134
Net change in unrealized appreciation on investments .......... 2,831,731
-----------
Net gain on investments ....................................... 6,908,865
-----------
Net Increase in Net Assets Resulting from Operations .......... $ 6,507,068
===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
7
<PAGE>
W.P. Stewart & Co. Growth Fund, Inc.
Statement of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the Year For the Year
Ended Ended
December 31, 1997 December 31, 1996
<S> <C> <C>
Increase (Decrease) in Net Assets:
From Operations:
Net investment loss .................................. $ (401,797) $ (235,124)
Net realized gain on investments ..................... 4,077,134 2,016,510
Net change in unrealized appreciation on investments . 2,831,731 2,384,634
------------ ------------
Net increase in net assets resulting
from operations .................................. 6,507,068 4,166,020
------------ ------------
Distributions to Shareholders from:
Net realized gain on investments ..................... (3,973,159) (1,480,720)
------------ ------------
From Fund Share Transactions:
Proceeds from shares sold ............................ 11,638,859 6,755,344
Shares issued to shareholders
in reinvestment of distributions .................. 4,849,063 439,506
Cost of redemptions .................................. (2,649,257) (840,805)
------------ ------------
Net increase in net assets from Fund
share transactions ............................... 13,838,665 6,354,045
------------ ------------
Net increase in net assets ........................ 16,372,574 9,039,345
Net Assets:
Beginning of year .................................... 19,828,832 10,789,487
------------ ------------
End of year .......................................... $ 36,201,406 $ 19,828,832
============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
8
<PAGE>
W.P. Stewart & Co. Growth Fund, Inc.
Financial Highlights
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the For the For the For the Period
Year Year Year February 29, 1994*
Ended Ended Ended Through
December 31, 1997 December 31, 1996 December 31, 1995 December 31, 1994
<S> <C> <C> <C> <C>
Income From Investment Operations:
Per Share Operating Performance:
Net asset value, beginning of period ....... $152.65 $125.94 $101.06 $100.00
------- ------- ------- -------
Net investment loss ...................... (1.87) (1.81) (1.15) (0.48)
Net realized and unrealized gain on
investments ........................... 38.53 40.17 29.19 1.54
------- ------- ------- -------
Net increase from investment operations .... 36.66 38.36 28.04 1.06
Distributions to shareholders from net
realized gain on investments ............. (20.60) (11.65) (3.16) 0.00
------- ------- ------- -------
Net asset value, end of period ............. $168.71 $152.65 $125.94 $101.06
======= ======= ======= =======
Total Investment Return (a) ................ 24.69% 30.64% 27.73% 1.06%
Ratios and Supplemental Data:
Ratio of expenses to average net assets .... 2.13% 2.50% 2.50% 2.50%(b)
Ratio of fees and expenses waived and
reimbursed by the Adviser and
Administrator to average net assets ...... .02% 0.28% 1.32% 10.20%(b)(c)
Ratio of net investment loss to
average net assets ....................... (1.35)% (1.51)% (1.36)% (1.25)%(b)
Portfolio turnover ......................... 79% 76% 76% 9%
Average commission rate (d) ................ $0.0800 $0.1000 N/A N/A
Net assets, end of period (in thousands) ... $36,201 $19,829 $10,789 $ 3,109
</TABLE>
* Commencement of investment operations.
(a) Total investment return is calculated assuming a purchase of common stock
at net asset value at the beginning of the period, a sale at net asset
value at the end of the period, reinvestment of all dividends and
distributions at net asset value during the period and no redemption fee.
Total investment return would be reduced if a redemption fee were taken
into account. Total investment return for a period of less than one year
is not annualized. Past performance results shown in this report should
not be considered a representation of future performance. Investment
return and net asset value of shares, when redeemed, may be worth more or
less than their original cost.
(b) Annualized.
(c) Includes organization expenses paid by Adviser.
(d) For fiscal years beginning on or after September 1, 1995, a fund is
required to disclose its average commission rate per share for trades on
which commissions are charged.
Contained above is the audited operating performance, based on a share of common
stock outstanding, total investment return, ratios to average net assets and
other supplemental data for the periods indicated. This information has been
determined based upon financial information provided in the financial
statements.
The accompanying notes are an integral part of these financial statements.
9
<PAGE>
W.P. Stewart & Co. Growth Fund, Inc.
Notes to Financial Statements
- --------------------------------------------------------------------------------
1. Organization and Fund Description
W.P. Stewart & Co. Growth Fund, Inc. (Fund) is an open-end, non-diversified,
management investment company registered under the Investment Company Act of
1940 (Act). It was incorporated under the laws of the State of Maryland in
September 1993. The Fund had no operations prior to October 25, 1993, other than
those relating to organizational matters. The initial capital contribution of
$100,000 was provided on October 25, 1993 by W.P. Stewart & Co., N.V. in
exchange for 1,000 shares of the Fund. The Fund invests primarily in common
stocks listed on the New York Stock Exchange. W.P. Stewart & Co., Inc., a
registered investment adviser, is the Fund's investment adviser (Adviser).
Shares of the Fund are available for subscription by eligible investors. There
is no sales charge. The redemption fee is .50%.
2. Significant Accounting Policies
The following is a summary of significant accounting policies followed by the
Fund.
Use of Estimates: The process of preparing 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 disclosures of contingent assets and liabilities at the date of
the financial statements, as well as the reported amounts of revenue and
expenses during the reporting period. Actual results could differ from those
estimates.
Investment Valuation: In general, the Fund values portfolio securities as of
their last available public sale price on the valuation date, in the case of
securities listed on any established securities exchanges or included in the
NASDAQ National Market System or any comparable foreign over-the-counter
quotation system providing last sale data or, if no sales of such securities are
reported on such date and in the case of over-the-counter securities not
described above in this paragraph, at the last reported bid price. All other
securities and assets are valued at fair value as determined in good faith by or
under the direction of the Board of Directors.
Investment Transactions: All securities transactions are recorded on a trade
date basis. Dividend income is recorded on the ex-dividend date and interest
income is recorded on the accrual basis. Realized gains and losses on sales of
securities are determined on the basis of identified cost.
Securities Lending: The Fund may lend its portfolio securities to brokers,
dealers and financial institutions when secured by collateral maintained on a
daily mark-to-market basis in an amount equal to at least 100% of the market
value, determined daily, of the loaned securities, The Fund at any time may call
the loan and obtain the return of the securities loaned, The Fund will continue
to receive the income on loaned securities and, at the same time, will earn
interest on the loan collateral, a portion of which generally will be rebated to
the borrower. Any cash collateral received under these loans will be invested in
short-term money market instruments. Where voting or consent rights with respect
to the loaned securities pass to the borrower, the Fund will follow the policy
of calling the loan, in whole or in part as may be appropriate, to permit the
exercise of such voting or consent rights if the matters involved will have a
material effect on the Fund's investment in the securities loaned. The Fund did
not engage in securities lending during the year ended December 31, 1997.
10
<PAGE>
Repurchase Agreements: A repurchase agreement customarily obligates the seller,
at the time it sells securities to the Fund, to repurchase the securities at a
mutually agreed upon time and price which, in the case of the Fund's
transactions, is within seven days. The total amount received by the Fund on
repurchase would be calculated to exceed the price paid by the Fund, reflecting
an agreed upon market rate of interest for the period of time to the settlement
date, and would not necessarily be related to the interest rate on the
underlying securities. The underlying securities are ordinarily United States
government securities, but may consist of other securities in which the Fund is
permitted to invest. Repurchase agreements will be fully collateralized at all
times. It is the policy of the Company to obtain possession of collateral with a
market value equal to or in excess of the principal amount loaned. Collateral is
valued daily, and the Company may require counterparties to deposit additional
collateral or return collateral pledged when appropriate. However, to the extent
that the proceeds from any sale upon default in the obligation to repurchase is
less than the repurchase price, the Fund would suffer a loss. Also, the Fund
might incur costs and encounter delays in liquidating collateral. The Fund may
enter into repurchase agreements maturing within seven days with domestic
dealers, banks and other financial institutions deemed to be creditworthy by the
Adviser.
Organization Expenses: The Adviser has borne all costs and expenses associated
with the organization and initial registration of the Fund and its shares.
Federal Income Taxes: The Fund's policy is to comply with the requirements of
the Internal Revenue Code that are applicable to regulated investment companies
and to distribute all of its taxable income to its stockholders. Therefore, no
Federal income tax provision is required.
Dividends and Distributions to Shareholders: The Fund intends to pay an annual
dividend to shareholders of record representing its entire net investment income
and to distribute all of its realized net capital gains at least annually.
Distributions are recorded on the ex-dividend date. Income distributions and
capital gain distributions are determined in accordance with income tax
regulations, which may differ from generally accepted accounting principles. For
the year ended December 31, 1997, the Fund distributed $20.60 per share.
Reclassification of Components of Net Assets: During the year ended December 31,
1997, the Fund reclassified certain components of net assets. The
reclassification was the result of permanent book to tax differences pertaining
to the reclassification of the current year's net operating losses. The
reclassification resulted in a net decrease to accumulated realized gain on
investments of $401,797. Net assets were not affected by the change.
3. Related Party Agreements and Other Transactions with Affiliates
Trading activities of the Fund are managed by its investment adviser, W.P.
Stewart & Co., Inc., pursuant to an agreement (Investment Advisory Services
Agreement) between the Adviser and the Fund. The Investment Advisory Services
Agreement has a two-year term and, thereafter, continues in effect from year to
year so long as its continuance is specifically approved at least annually by
the Board of Directors or by a vote by the holders of a majority of the
outstanding shares. The Adviser is entitled to receive quarterly advisory fees
payable in arrears as of the first day of each quarter at an annual rate equal
to 1.5% of the net asset value of the Fund, as determined on the last day of the
preceding quarter (after giving effect to subscriptions and redemptions
effective on such date).
In addition to the quarterly advisory fee, the Fund bears all costs and expenses
directly related to investment transactions effected and positions held for the
Fund's account, including brokerage commissions, custodial fees, interest on
borrowings and administrative fees. The Adviser reimburses the Fund for expenses
that exceed the most restrictive expense limitation imposed by state securities
commissions, which was defined to be 2.5% of the average value of the Fund's net
assets. For the year ended December 31, 1997, the total expenses reimbursed by
the Adviser were $4,636. In addition, the Adviser has borne the cost of
professional services incurred by the Fund, including audit, legal, printing and
insurance expenses. The amount of the expenses for professional services borne
by the Adviser was $45,084 for the year ended December 31, 1997.
Under the terms of the Investment Advisory Services Agreement, the Adviser or an
affiliated company may conduct brokerage services for the Fund. For the year
ended December 31, 1997, the Adviser and an
11
<PAGE>
affiliated company earned an aggregate amount of $83,484 in commissions as
broker on trades of portfolio securities.
Certain directors of the Adviser are also directors of the Fund. Each of the
Fund's directors who is not an officer or employee of the Adviser is entitled to
be paid by the Adviser a fee of $1,250 for each meeting that they attend of the
Fund's Board of Directors and each meeting of any committee of the Board of
Directors on which they serve. Directors may waive such fees. For the year ended
December 31, 1997 there were no directors' fees paid.
4. Administration Agreement
The Fund has entered into an Administration Agreement with State Street Bank and
Trust Company (Administrator) dated January 11, 1994. Under that agreement, the
Administrator receives an annual fee equal to .08% of the Fund's net asset value
up to $125 million, .06% of the next $125 million, and .04% of assets in excess
of $250 million.
5. Investment Transactions
Purchases of investments and proceeds from sales of investments, excluding
short-term securities, for the year ended December 31, 1997 were $31,889,361 and
$22,326,451, respectively. As of December 31, 1997, unrealized appreciation and
depreciation for Federal income tax purposes were $6,730,695 and $459,385,
respectively. The aggregate cost of investments at December 31, 1997 for Federal
income tax purposes was $29,664,203.
6. Fund Share Transactions
The Fund is authorized to issue 100,000,000 shares of $.001 par value capital
stock. For the years ended December 31, 1997 and 1996 transactions in shares
were as follows:
<TABLE>
<CAPTION>
Year Ended December 31, 1997 Year Ended December 31, 1996
Shares Amount Shares Amount
------ ------ ------ ------
<S> <C> <C> <C> <C>
Sold ............. 70,106 $11,638,859 46,937 $6,755,344
Reinvested ....... 30,257 4,849,063 3,293 439,506
Redeemed ......... (15,677) (2,649,257) (6,004) (840,805)
------ ----------- ------ ----------
Net increase ..... 84,686 $13,838,665 44,226 $6,354,045
====== =========== ====== ==========
</TABLE>
7. Beneficial Interest
At December 31, 1997, no shareholder owned more than 5% of the Fund's
outstanding shares.
8. Estimated Fair Value of Financial Instruments
Statement of Financial Accounting Standards No. 107, "Disclosures About Fair
Value of Financial Instruments" requires disclosure of fair value information
about financial instruments for which it is practicable to estimate the value,
whether or not recognized on the statement of financial condition. As a
registered investment company, the Fund's investments in securities are already
recorded at market value. The fair value of all other financial assets and
liabilities is considered to approximate the recorded value, due to the
short-term nature of the financial instruments.
12
<PAGE>
[Letterhead of Lopez Edwards Frank & Co., LLP]
Independent Auditors' Report
To the Shareholders and
Board of Directors
W.P. Stewart & Co. Growth Fund, Inc.
We have audited the accompanying statement of assets and liabilities
of W.P. Stewart & Co. Growth Fund, Inc., including the schedule of investments
as of December 31, 1997, and the related statement of operations for the year
then ended, the statement of changes in net assets for each of the two years in
the period then ended, and financial highlights for each of the three years in
the period then ended, and for the period from February 28, 1994 (commencement
of investment operations) through December 31, 1994. These financial statements
and financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of securities
owned as of December 31, 1997, by correspondence with the custodian and brokers.
An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of W.P. Stewart & Co. Growth Fund, Inc. as of December 31, 1997, the
results of its operations for the year then ended, the changes in its net assets
for each of the two years in the period then ended, and financial highlights for
each of the three years in the period then ended, and for the period from
February 28, 1994 (commencement of investment operations) through December 31,
1994, in conformity with generally accepted accounting principles.
/s/ Lopez Edwards Frank & Co., LLP
New York, New York
February 13, 1998
<PAGE>
W.P. Stewart & Co. Growth Fund, Inc.
527 Madison Avenue
New York, NY 10022
===============================================================================
Directors and Officers
William P. Stewart President and Director
Robert L. Schwartz Treasurer, Secretary and Director
Antoine Bernheim Director
June Eichbaum Director
William Talcott May Director
Stephen E. Memishian Vice President
Investment Adviser
W.P. Stewart & Co., Inc.
527 Madison Avenue
New York, NY 10022
(212) 750-8585
Administrator, Custodian, Transfer Agent and Shareholder Servicing Agent
State Street Bank and Trust Company
1776 Heritage Drive
North Quincy, MA 02171
Independent Auditors
Lopez Edwards Frank & Co., LLP
1 Penn Plaza
New York, NY 10119-0141
Legal Counsel
Shereff, Friedman, Hoffman & Goodman, LLP
919 Third Avenue
New York, NY 10022-9998
===============================================================================
This report is not authorized for use as an offer of sale or a solicitation of
an offer to buy shares of the Fund unless accompanied or preceded by the Fund's
current prospectus. Past performance results shown in this report should not be
considered a representation of future performance. Investment return and net
asset value of shares, when redeemed, may be worth more or less than their
original cost.
