<PAGE>
TEMPLETON LATIN
AMERICA FUND
YOUR FUND'S OBJECTIVE:
The Templeton Latin America Fund seeks long-term capital appreciation through
investing at least 65% of its total assets in equity and debt securities of
issuers in Latin America.
May 16, 1996
Dear Shareholder:
We are pleased to bring you the first annual report of the Templeton Latin
America Fund, which covers the period from the inception of the Fund on May 8,
1995, through March 31, 1996. As shown in the Performance Summary on page 5,
the Fund's Class I shares delivered a total return of 6.37%, underperforming the
benchmark International Finance Corporation (IFC) Latin America Index, which
rose 8.65% during this time. Much of this under-performance was due to the
large amount of cash held during the first several months of the Fund's
existence, as we sought to take advantage of future market opportunities.
Because of the volatile nature of Latin American markets, such opportunities
usually occur more frequently than is the case in mature markets like that of
the United States.
1
<PAGE>
During the first half of the reporting period, the stock markets in Mexico and
Brazil benefited from governmental programs designed to restructure and improve
their economies. Mexico's Emergency Economic Stabilization Plan (EESP), which
had been greeted skeptically by investors in the early part of 1995, began
controlling the country's balance of payments problem and stabilizing its
currency. Meanwhile, in Brazil, President Cardoso's ambitious reform program
passed quickly through the legislature.
The second half of the period, however, presented a different picture. As is
often the case in Latin America, market enthusiasm was short-lived, and
confidence in the afore-mentioned reform programs waned. Fears developed that
Mexico's EESP would be undermined by President Zedillo's political rivals, and
in Brazil, Cardoso's apparently flawless leadership seemed to be under scrutiny,
causing delays in his legislative agenda. These concerns resulted in the Latin
American "mini-crisis" of November 1995, and security prices in the region
plummeted to levels not seen since the Mexican devaluation crisis of December
1994.
<TABLE>
<CAPTION>
- -----------------------------------------------
TEMPLETON LATIN AMERICA FUND
Geographic Distribution on 3/31/96
Based on Total Net Assets
[PIE CHART APPEARS HERE]
<S> <C>
Brazil 31.7%
Mexico 18.0%
Argentina 16.9%
Peru 4.6%
Colombia 4.5%
Chile 3.1%
Panama 3.0%
Bolivia 1.7%
Short Term Obligations
& Other Net Assets 16.5%
</TABLE>
This mini-crisis provided us with the opportunity to purchase stocks at what we
believed were attractive valuations, and the Fund's Short-Term Obligations &
Other Net Assets position declined from 82.2% on September 30, 1995 to 16.5% at
the end of the period. Much of this cash was invested in Argentina, whose stock
market had declined sharply due to a rumored political disagreement between
President Menen and Finance Minister Cavallo. In particular, we added to the
Fund's telecommunications and utility sectors, both of which we believe have
solid earnings potential.
2
<PAGE>
For example, we initiated positions in Perez Companc, a multi-industry
conglomerate with a history of shrewd investments in the region, and Telefonica
de Argentina, a rapidly growing telecommunications company with an impressive
balance sheet.
In the months following the mini-crisis, we continued to invest in what we felt
were high-quality firms, including Telefonos de Mexico (Telmex), one of the
world's largest telecommunications companies, and Companhia Siderurgica Nacional
(CSN), the Brazilian steel manufacturer. In our opinion, Telmex has an
excellent management team, and CSN has the potential to reap further gains in a
country with a growing demand for steel.
Looking forward, we are optimistic about the potential long-term investment
opportunities in Latin America. In our opinion, the remainder of the year may
see the confluence of a number of favorable trends. Due to declining interest
rates and low inflation, Mexico could experience positive economic growth after
a dismal 1995. Argentina's economy could regain financial strength, as investor
confidence returns to that country. And Brazil's economy has the potential to
expand by year end, as real interest rates fall and economic programs proceed
under
Templeton Latin America Fund
Top 10 Holdings on 3/31/96
Based on Total Net Assets
<TABLE>
<CAPTION>
[BAR CHART APPEARS HERE]
% of Total
Company, Industry, Country Net Assets
- ----------------------------------------------------
<S> <C>
Companhia Siderurgica Nacional
Metals & Mining, Brazil 4.4%
- ----------------------------------------------------
Telefonos de Mexico SA, L, ADR
Telecommunications, Mexico 3.9%
- ----------------------------------------------------
Perez Companc SA, B
Energy Sources, Argentina 3.6%
- ----------------------------------------------------
Banco Bradesco SA, pfd.
Banking, Brazil 3.6%
- ----------------------------------------------------
Telebras-Telecomunicacoes Brasileiras SA,
Telecommunications, Brazil 3.2%
- ----------------------------------------------------
Coteminas Cia Tecidos Notre de Minas
Textiles & Apparel, Brazil 3.1%
- ----------------------------------------------------
Telecomunicacoes de Minas Gerais SA
Telecommunications, Brazil 3.0%
- ----------------------------------------------------
Panamerican Berverages, Inc., A
Food & Household Products, Panama 3.0%
- ----------------------------------------------------
Cia Energetica de Minas Gerais, pfd., ADR
Utilities -- Electrical & Gas, Brazil 2.8%
- ----------------------------------------------------
Vale do Rio Doce, ADR
Metals & Mining, Brazil 2.7%
- ----------------------------------------------------
</TABLE>
For a detailed listing of portfolio holdings, please see page 9 of this
report.
Cardoso's watch. Given the possibility of market-friendly reforms and continued
rises in standards of living, we feel few regions in the world have the long-
term potential growth prospects of Latin America.
This discussion reflects the strategies we employed for the Fund during the
period under review, and includes our opinions as of the close of the period.
Since
3
<PAGE>
economic and market conditions are constantly changing, our strategies, and our
evaluations, conclusions and decisions regarding portfolio holdings, may change
as new circumstances arise. Although past performance of a specific investment
or sector cannot guarantee future performance, such information can be useful in
analyzing securities we purchase or sell for the Fund.
It should be remembered, of course, that investing in emerging markets
concentrated in a single region involves special considerations, which may
include risks related to market and currency volatility, adverse social and
political developments, and the relatively small size and lesser liquidity of
these markets. While short-term volatility can be disconcerting, declines of as
much as 30% to 40% are not unusual in emerging markets. For example, the Mexican
stock market has increased more than 282% in the last five years, but has
suffered three declines of more than 15% during that time.*
We thank you for investing in the Templeton Latin America Fund and look forward
to serving your investment needs in the months and years to come.
Sincerely,
[SIGNATURE APPEARS HERE]
Mark Holowesko, CFA
President
Templeton Global Investment Trust
*Source: Bloomberg. Based on quarterly percentage price change over the five-
year period ended March 31, 1996.
4
<PAGE>
PERFORMANCE SUMMARY
CLASS I
The Templeton Latin America Fund Class I shares reported a cumulative total
return of 6.37% for the abbreviated period ended March 31, 1996. Total return
measures the change in value of an investment, assuming reinvestment of
dividends, and does not include sales charges. We maintain a long-term
perspective when managing the Fund, and encourage our shareholders to view their
investments in a similar manner.
The price of the Fund's Class I shares, as measured by net asset value,
increased from $10.00 on May 8, 1995 to $10.53 on March 31, 1996. During the
reporting period, the Fund's Class I shares distributed 10 cents ($0.10) per
share in income dividends. Of course, past performance is not indicative of
future results, and dividends will vary depending on income earned by the Fund.
The graph to the right compares the Templeton Latin America Class I shares'
performance since inception on May 8, 1995, with that of the unmanaged
International Finance Corporation (IFC) Latin America Index. This index
measures the total return of equities in six Latin American countries
(Argentina, Brazil, Chile, Colombia, Mexico, and Venezuela) as if they were in
one market, and includes reinvested dividends. Please remember that the Fund's
performance differs from that of the index because the index does not contain
cash (the Fund generally carries a certain percentage of cash at any given time)
and includes no sales charges or management expenses. Of course, one cannot
invest directly in an index, and past performance is not predictive of future
results.
TEMPELTON LATIN AMERICA FUND
CLASS I
Total Return Index Comparison
$10.000 Investment (5/8/95-3/31/96)
[GRAPH APPEARS HERE SHOWING COMPARISON BETWEEN TEMPLETON LATIN AMERICA
FUND-CLASS I* AND IFC LATIN AMERICA INDEX]
<TABLE>
<CAPTION>
- ------------------------------------------------
<S> <C> <C>
Templeton Latin America 5/95 3/96
Fund-Class I $10,000 $10,026
IFC Latin America
Index $10,000 $10,369
- ------------------------------------------------
</TABLE>
*Includes all sales charges and represents the change in value of an investment
over the indicated period. Total return assumes reinvestment of dividends.
Past performance is not indicative of future results.
- ---------------------------------------------
TEMPLETON LATIN AMERICA FUND
Period ended March 31, 1996
Class I
<TABLE>
<CAPTION>
<S> <C>
Since
Inception
(5/8/95)
Aggregate Total Return/1/ 0.26%
Cumulative Total Return/2/ 6.37%
- ---------------------------------------------
</TABLE>
1. Aggregate total return represents the change in value of an investment over
the indicated period. The figure reflects the maximum 5.75% initial sales
charge. Since the Fund has existed for less than one year, average annual total
returns are not provided.
2. Cumulative total return represents the change in value of an investment over
the indicated period, and does not include the maximum 5.75% initial sales
charge.
All total return calculations reflect the deduction of a proportional share of
Fund expenses on an annual basis, and assume that all dividends were reinvested
when paid. The Fund's investment manager and business manager have agreed in
advance to waive a portion of their respective fees, which increases total
return to shareholders. If the managers had not taken this action, total returns
would have been lower. The fee waiver may be discontinued at any time, upon
notice to the Fund's Board of Trustees.
Investment return and principal value will fluctuate with market conditions,
currencies, and the economic and political climates of the countries where
investments are made. Developing markets involve heightened risks related to the
same factors, in addition to those associated with the relatively small size and
lesser liquidity of those markets. Because of these factors, your shares, when
redeemed, may be worth more or less than their original cost. Past performance
is not predictive of future results.
5
<PAGE>
PERFORMANCE SUMMARY
Class II
The Templeton Latin America Fund Class II shares reported a cumulative total
return of 5.67% since inception on May 8, 1995. Cumulative total return shows
the change in value of an investment and does not include the initial sales
charge. We maintain a long-term perspective when managing the Fund, and
encourage our shareholders to view their investments in a similar manner.
The price of the Fund's Class II shares, as measured by net asset value,
increased from $10.00 on May 8, 1995 to $10.49 on March 31, 1996. During the
reporting period, the Fund's Class II Shares distributed 7.15 cents ($0.0715)
per share in income dividends. Of course, past performance is not indicative of
future results, and dividends will vary depending on income earned by the Fund.
The graph to the right compares the Templeton Latin America Fund Class II
shares' performance since inception on May 8, 1995, with the unmanaged
International Finance Corporation (IFC) Latin America Index. This index
measures the total return of equities in six Latin American countries
(Argentina, Brazil, Chile, Colombia, Mexico, and Venezuela) as if they were in
one market, and includes reinvested dividends. Please remember that the Fund's
performance differs from that of the index because the index does not contain
cash (the Fund generally carries a certain percentage of cash at any given time)
and includes no sales charges or management expenses. Of course, one cannot
invest directly in an index, and past performance is not predictive of future
results.
TEMPELTON LATIN AMERICA FUND
CLASS II
Total Return Index Comparison
$10,000 Investment (5/8/95 - 3/31/96)
[GRAPH APPEARS HERE SHOWING COMPARISON BETWEEN TEMPLETON LATIN AMERICA
FUND-CLASS II* AND IFC LATIN AMERICA INDEX]
<TABLE>
<CAPTION>
- ------------------------------------------------
<S> <C> <C>
5/95 3/96
Templeton Latin America
Fund-Class II $10,000 $10,363
IFC Latin America Index $10,000 $10,369
- ------------------------------------------------
</TABLE>
*Includes all sales charges and represents the change in value of an investment
over the indicated period. Total return assumes reinvestment of dividends.
Past performance is not indicative of future results.
TEMPLETON LATIN AMERICA FUND
Period ended March 31, 1996
Class II
<TABLE>
<CAPTION>
- -------------------------------------------
<S> <C>
Since
Inception
(5/8/95)
Aggregate Total Return/1/ 3.63%
Cumulative Total Return/2/ 5.67%
- -------------------------------------------
</TABLE>
1. Aggregate total return represents the change in value of an investment over
the indicated period. The figure includes the deduction of the 1.0% initial
sales charge and the 1.0% contingent deferred sales charge (CDSC), applicable to
shares redeemed within the first 18 months of investment. Since the Fund has
existed for less than one year, average annual total returns are not provided.
2. Cumulative total return represents the change in value of an investment over
the indicated period. This calculation does not include the deduction of the
1.0% initial sales charge or the 1.0% CDSC, applicable to shares redeemed within
the first 18 months of investment.
All total return calculations reflect the deduction of a proportional share of
Fund expenses on an annual basis, and assume that all dividends were reinvested
when paid. The Fund's investment manager and business manager have agreed in
advance to waive a portion of their respective fees, which increases total
return to shareholders. If the managers had not taken this action, total returns
would have been lower. The fee waiver may be discontinued at any time, upon
notice to the Fund's Board of Trustees.
Investment return and principal value will fluctuate with market conditions,
currencies, and the economic and political climates of the countries where
investments are made. Developing markets involve heightened risks related to the
same factors, in addition to those associated with the relatively small size and
lesser liquidity of those markets. Because of these factors, your shares, when
redeemed, may be worth more or less than their original cost. Past performance
is not predictive of future results.
6
<PAGE>
Templeton Latin America Fund
Financial Highlights
- --------------------------------------------------------------------------------
PER SHARE OPERATING PERFORMANCE--CLASS I(For a share outstanding throughout the
period)
<TABLE>
<CAPTION>
MAY 8, 1995
(COMMENCEMENT
OF OPERATIONS) TO
MARCH 31, 1996
-----------------
<S> <C>
Net asset value, beginning of period $10.00
------
Income from investment operations:
Net investment income .12
Net realized and unrealized gain .51
------
Total from investment operations .63
Distributions from net investment income (.10)
------
Change in net asset value .53
------
Net asset value, end of period $10.53
======
TOTAL RETURN* 6.37%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000) $5,150
Ratio of expenses to average net assets 4.02%**
Ratio of expenses, net of reimbursement, to average net as-
sets 2.35%**
Ratio of net investment income to average net assets 1.71%**
Average commission rate paid (per share) $.0004
</TABLE>
* TOTAL RETURN DOES NOT REFLECT SALES COMMISSIONS. NOT ANNUALIZED FOR PERIODS
OF LESS THAN ONE YEAR.
** ANNUALIZED.
7
<PAGE>
Templeton Latin America Fund
Financial Highlights (cont.)
- --------------------------------------------------------------------------------
PER SHARE OPERATING PERFORMANCE--CLASS II (For a share outstanding throughout
the period)
<TABLE>
<CAPTION>
MAY 8, 1995
(COMMENCEMENT
OF OPERATIONS) TO
MARCH 31, 1996
-----------------
<S> <C>
Net asset value, beginning of period $10.00
------
Income from investment operations:
Net investment income .08
Net realized and unrealized gain .48
------
Total from investment operations .56
Distributions from net investment income (.07)
------
Change in net asset value .49
------
Net asset value, end of period $10.49
======
TOTAL RETURN* 5.67%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000) $1,351
Ratio of expenses to average net assets 4.67%**
Ratio of expenses, net of reimbursement, to average net as-
sets 3.00%**
Ratio of net investment income to average net assets 1.14%**
Average commission rate paid (per share) $.0004
</TABLE>
* TOTAL RETURN DOES NOT REFLECT SALES COMMISSIONS OR THE CONTINGENT DEFERRED
SALES CHARGE. NOT ANNUALIZED FOR PERIODS OF LESS THAN ONE YEAR.
** ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
8
<PAGE>
Templeton Latin America Fund
Investment Portfolio, March 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INDUSTRY ISSUE COUNTRY SHARES VALUE
<C> <S> <C> <C> <C>
- -------------------------------------------------------------------------------
COMMON STOCKS: 61.5%
- -------------------------------------------------------------------------------
Banking: 4.1%
Banco de Galicia y Buenos Aires SA,
B Arg. 16,000 $ 95,840
Banco Ganadero SA, ADR Col. 4,800 94,800
Corporacion Financiera del Valle,
GDR, 144A Col. 8,104 76,987
-----------
267,627
- -------------------------------------------------------------------------------
Beverages & Tobacco: 0.7%
Cristalerias de Chile SA, ADR Chil. 2,000 45,500
- -------------------------------------------------------------------------------
Building Materials & Components: 5.2%
Cementos Diamante, ADR, 144A Col. 7,800 121,875
*Corcemar Corp. Arg. 10,400 41,600
*Internacional de Ceramica SA de CV Mex. 57,000 75,647
Mirgor SA Comercial Industrial
Financiera Inmobiliari
Agropecuaria, ADR, 144A Arg. 34,000 97,750
-----------
336,872
- -------------------------------------------------------------------------------
Construction & Housing: 1.3%
Empresas ICA Sociedad Controladora
SA, ADR Mex. 6,700 87,100
- -------------------------------------------------------------------------------
Energy Sources: 6.5%
Perez Companc SA, B Arg. 41,210 233,249
Transportadora de Gas del Sur SA,
ADR B Arg. 9,200 110,400
YPF Sociedad Anonima, ADR Arg. 4,000 80,500
-----------
424,149
- -------------------------------------------------------------------------------
Food & Household Products: 8.9%
*Grupo Embotellador de Mexico SA, B Mex. 43,500 62,349
*Grupo Industrial Maseca SA de CV,
ADR B Mex. 9,700 122,463
*Herdez SA de CV, A Mex. 300,000 83,212
Panamerican Beverages Inc., A Pan. 4,800 193,800
*Tablex SA de CV Mex. 61,000 113,662
-----------
575,486
- -------------------------------------------------------------------------------
Forest Products & Paper: 3.9%
Aracruz Celulose SA, ADR Braz. 15,700 125,600
Empaques Ponderosa SA, B Mex. 60,000 124,857
-----------
250,457
- -------------------------------------------------------------------------------
Industrial Components: 2.4%
Madeco Manufacturera de Cobre SA,
ADR Chil. 6,300 157,500
- -------------------------------------------------------------------------------
Merchandising: 1.9%
Cifra SA, C Mex. 95,000 124,565
- -------------------------------------------------------------------------------
</TABLE>
9
<PAGE>
Templeton Latin America Fund
Investment Portfolio, March 31, 1996 (cont.)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INDUSTRY ISSUE COUNTRY SHARES VALUE
<C> <S> <C> <C> <C>
- -------------------------------------------------------------------------------
COMMON STOCKS: (CONT.)
- -------------------------------------------------------------------------------
Metals & Mining: 7.1%
Companhia Siderurgica Nacional Braz. 9,700,000 $ 283,459
Vale do Rio Doce, ADR Braz. 4,500 176,520
-----------
459,979
- -------------------------------------------------------------------------------
Multi-Industry: 2.6%
*Banco de Credito del Peru Per. 51,000 84,566
Banco Wiese, ADR Per. 12,500 84,375
-----------
168,941
- -------------------------------------------------------------------------------
Telecommunications: 10.6%
Telebras-Telecomunicacoes
Brasileiras SA Braz. 600,000 23,749
Telecom Argentina Stet France SA,
ADR Arg. 1,900 78,850
Telecomunicacoes de Minas Gerais SA Braz. 1,600,000 115,100
Telefonica de Argentina SA, B, ADR Arg. 3,400 87,125
Telefonica de Peru, B Per. 62,000 127,849
Telefonos de Mexico SA, L, ADR Mex. 7,700 253,138
-----------
685,811
- -------------------------------------------------------------------------------
Textiles & Apparel: 0.4%
*Coteminas Cia Tecidos Norte de
Minas Braz. 70,000 28,362
- -------------------------------------------------------------------------------
Transportation: 1.9%
Transportacion Maritima Mexicana
SA, L, ADR Mex. 15,000 123,750
- -------------------------------------------------------------------------------
Utilities--Electrical & Gas: 4.0%
Central Costanera SA, ADR, 144A Arg. 2,600 75,400
Central Puerto SA, ADR Arg. 4,700 75,200
Compania Boliviana de Energia
Electricas SA Bol. 3,000 110,250
-----------
260,850
-----------
TOTAL COMMON STOCKS (cost $3,860,929) 3,996,949
- -------------------------------------------------------------------------------
PREFERRED STOCKS: 22.0%
- -------------------------------------------------------------------------------
Banco Bradesco SA, pfd. Braz. 22,033,820 230,995
Ceval Alimentos SA, pfd. Braz. 13,700,000 173,323
Cia de Inversiones en
Telecomunicaciones SA 7.00%,
conv., 3/03/98, pfd. Arg. 2,350 123,963
*Cia Energetica de Minas Gerais,
pfd., ADR Braz. 6,400 179,460
Coteminas Cia Tecidos Norte de
Minas, pfd. Braz. 416,000 172,658
*Lojas Americanas SA, pfd. Braz. 6,800,000 163,831
Petrobras-Petroleo Brasileiro SA,
pfd. Braz. 480,000 57,337
Telebras-Telecomunicacoes
Brasileiras SA, pfd., ADR Braz. 3,700 184,075
Telecomunicacoes de Minas Gerais
SA, pfd. Braz. 1,000,000 81,000
Telesp-Telecomunicacoes de Sao
Paulo SA, pfd. Braz. 387,057 65,825
-----------
TOTAL PREFERRED STOCKS (cost $1,375,851) 1,432,467
- -------------------------------------------------------------------------------
</TABLE>
10
<PAGE>
Templeton Latin America Fund
Investment Portfolio, March 31, 1996 (cont.)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL IN
INDUSTRY ISSUE COUNTRY LOCAL CURRENCY** VALUE
<C> <S> <C> <C> <C>
- -------------------------------------------------------------------------------
SHORT TERM OBLIGATIONS: 50.2% (cost
$3,262,397)
- -------------------------------------------------------------------------------
U.S. Treasury Bills, 4.53% to
5.08%, with
maturities to 6/06/96 U.S. 3,281,000 $ 3,262,304
- -------------------------------------------------------------------------------
TOTAL INVESTMENTS: 133.7% (cost
$8,499,177) 8,691,720
OTHER ASSETS, LESS LIABILITIES: (33.7)% (2,190,263)
-----------
TOTAL NET ASSETS: 100.0% $ 6,501,457
===========
</TABLE>
*NON-INCOME PRODUCING.
**CURRENCY OF COUNTRY INDICATED.
SEE NOTES TO FINANCIAL STATEMENTS.
11
<PAGE>
Templeton Latin America Fund
Financial Statements
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
March 31, 1996
<TABLE>
<S> <C>
Assets:
Investments in securities, at value (identified cost $8,499,177) $8,691,720
Cash 243
Receivables:
Fund shares sold 57,769
Dividends 8,666
Unamortized organization costs 72,532
----------
Total assets 8,830,930
----------
Liabilities:
Payables:
Investment securities purchased 2,270,973
Fund shares redeemed 14,854
Accrued expenses 43,646
----------
Total liabilities 2,329,473
----------
Net assets, at value $6,501,457
==========
Net assets consist of:
Undistributed net investment income $ 13,836
Net unrealized appreciation 192,543
Accumulated net realized gain 512
Net capital paid in on shares of beneficial interest 6,294,566
----------
Net assets, at value $6,501,457
==========
Class I
Net asset value per share ($5,150,203 / 489,226 shares outstanding) $ 10.53
==========
Maximum offering price
($10.53 / 94.25%) $ 11.17
==========
Class II
Net asset value per share ($1,351,254 / 128,824 shares outstanding) $ 10.49
==========
Maximum offering price
($10.49 / 99.00%) $ 10.60
==========
</TABLE>
STATEMENT OF OPERATIONS
for the period May 8, 1995 (commencement of operations) to March 31, 1996
<TABLE>
<S> <C> <C>
Investment income: (net of $1,289 foreign taxes withheld)
Dividends $ 26,791
Interest 118,866
--------
Total income $145,657
Expenses:
Management fees (Note 3) 44,350
Administrative fees (Note 3) 5,322
Distribution fees (Note 3)
Class I 9,725
Class II 6,926
Transfer agent fees (Note 3) 8,000
Custodian fees 1,500
Reports to shareholders 27,050
Audit fees 9,500
Legal fees (Note 3) 8,700
Registration and filing fees 6,083
Trustees' fees and expenses 4,350
Amortization of organization costs 16,247
Other 980
--------
Total expenses 148,733
Less expenses reimbursed (Note 3) (59,675)
--------
Total expenses less reimbursement 89,058
--------
Net investment income 56,599
Realized and unrealized gain:
Net realized gain on:
Investments 213
Foreign currency transactions 299
--------
512
Net unrealized appreciation on investments 192,543
--------
Net realized and unrealized gain 193,055
--------
Net increase in net assets resulting from operations $249,654
========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
12
<PAGE>
Templeton Latin America Fund
Financial Statements (cont.)
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
MAY 8, 1995
(COMMENCEMENT OF
OPERATIONS) TO
MARCH 31, 1996
----------------
<S> <C>
Increase (decrease) in net assets:
Operations:
Net investment income $ 56,599
Net realized gain on investment and foreign currency
transactions 512
Net unrealized appreciation 192,543
----------
Net increase in net assets resulting from operations 249,654
Distributions to shareholders:
From net investment income:
Class I (35,519)
Class II (7,244)
Fund share transactions (Note 2)
Class I 4,989,263
Class II 1,305,303
----------
Net increase in net assets 6,501,457
Net assets:
Beginning of period --
----------
End of period $6,501,457
==========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
13
<PAGE>
Templeton Latin America Fund
Notes to Financial Statements
- --------------------------------------------------------------------------------
1. SUMMARY OF ACCOUNTING POLICIES
Templeton Latin America Fund (the Fund) is a separate series of Templeton
Global Investment Trust (the Trust), a Delaware business trust, which is an
open-end diversified management investment company registered under the Invest-
ment Company Act of 1940. The Fund seeks to achieve long-term capital apprecia-
tion by investing primarily in equity securities and debt obligations of is-
suers in Latin American countries. The following summarizes the Fund's signifi-
cant accounting policies.
a. Securities Valuations:
Securities listed or traded on a recognized national or foreign exchange or
NASDAQ are valued at the last reported sales prices on the principal exchange
on which the securities are traded. Over-the-counter securities and listed se-
curities for which no sale is reported are valued at the mean between the last
current bid and asked prices. Securities for which market quotations are not
readily available are valued at fair value as determined by management and ap-
proved in good faith by the Board of Trustees.
b. Foreign Currency Transactions:
Portfolio securities and other assets and liabilities denominated in foreign
currencies are translated into U.S. dollars based on the rate of exchange of
such currencies against U.S. dollars on the date of valuation. Purchases and
sales of portfolio securities and income items denominated in foreign curren-
cies are translated into U.S. dollar amounts on the respective dates of such
transactions. When the Fund purchases or sells foreign securities it customar-
ily enters into a foreign exchange contract to minimize foreign exchange risk
between the trade date and the settlement date of such transactions.
The Fund does not isolate that portion of the results of operations resulting
from changes in foreign exchange rates on investments from the fluctuations
arising from changes in market prices of securities held. Such fluctuations are
included with the net realized and unrealized gain or loss from investments.
Reported net realized foreign exchange gains or losses arise from sales of for-
eign currencies, currency gains or losses realized between the trade and set-
tlement dates on securities transactions, the differences between the amounts
of dividends, interest, and foreign withholding taxes recorded on the Fund's
books, and the U.S. dollar equivalent of the amounts actually received or paid.
Net unrealized foreign exchange gains and losses arise from changes in the
value of assets and liabilities other than investments in securities at the end
of the fiscal period, resulting from changes in the exchange rates.
c. Income Taxes:
It is the Fund's policy to comply with the requirements of the Internal Revenue
Code applicable to regulated investment companies and to distribute all of its
taxable income to its shareholders. Therefore, no provision has been made for
income taxes.
d. Unamortized Organization Costs:
Organization costs are being amortized on a straight line basis over five
years.
e. Security Transactions, Investment Income, Distributions, and Expenses:
Security transactions are accounted for on a trade date basis. Dividend income
is recorded on the ex-dividend date. Certain dividend income on foreign securi-
ties is recorded as soon as information is available to the Fund. Interest in-
come and estimated expenses are accrued daily. Distributions to shareholders,
which are determined in accordance with income tax regulations, are recorded on
the ex-dividend date.
f. Accounting Estimates:
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities at the date of the
financial statements and the amounts of income and expense during the reporting
period. Actual results could differ from those estimates.
14
<PAGE>
Templeton Latin America Fund
Notes to Financial Statements (cont.)
- --------------------------------------------------------------------------------
2. TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST
The Fund offers two classes of shares: Class I shares and Class II shares.
Shares of each class are identical except for their initial sales load, a con-
tingent deferred sales charge on Class II shares, distribution fees, and voting
rights on matters affecting a single class. At March 31, 1996, there was an un-
limited number of shares of beneficial interest authorized ($.01 par value).
Transactions in the Fund's shares were as follows:
<TABLE>
<CAPTION>
CLASS I
---------------------
FOR THE PERIOD
MAY 8, 1995
(COMMENCEMENT OF
OPERATIONS) THROUGH
MARCH 31, 1996
---------------------
SHARES AMOUNT
-------- -----------
<S> <C> <C>
Shares sold 601,968 $ 6,143,719
Shares issued on reinvestment of distributions 3,013 29,565
Shares redeemed (115,755) (1,184,021)
-------- -----------
Net increase 489,226 $ 4,989,263
======== ===========
<CAPTION>
CLASS II
---------------------
FOR THE PERIOD
MAY 8, 1995
(COMMENCEMENT OF
OPERATIONS) THROUGH
MARCH 31, 1996
---------------------
SHARES AMOUNT
-------- -----------
<S> <C> <C>
Shares sold 131,412 $ 1,332,030
Shares issued on reinvestment of distributions 738 7,232
Shares redeemed (3,326) (33,959)
-------- -----------
Net increase 128,824 $ 1,305,303
======== ===========
</TABLE>
Templeton Global Investors, Inc., the Fund's administrative manager, is the
record owner of 50,464 Class I shares and 50,365 Class II shares as of March
31, 1996.
15
<PAGE>
Templeton Latin America Fund
Notes to Financial Statements (cont.)
- --------------------------------------------------------------------------------
3. INVESTMENT MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Certain officers of the Fund are also directors or officers of Templeton Global
Advisors Ltd. (TGAL), Templeton Global Investors, Inc. (TGII), Franklin Temple-
ton Distributors, Inc. (FTD), and Franklin Templeton Investor Services, Inc.
(FTIS), the Fund's investment manager, administrative manager, principal under-
writer, and transfer agent, respectively.
The Fund pays monthly an investment management fee to TGAL equal, on an annual
basis, to 1.25% of the Fund's average daily net assets. The Fund pays TGII
monthly its allocated share of an administrative fee of 0.15% per annum of the
first $200 million of the Trust's aggregate average daily net assets, 0.135% of
the next $500 million, 0.10% of the next $500 million, and 0.075% per annum of
average net assets in excess of $1.2 billion. TGAL and TGII have voluntarily
agreed to reduce their respective fees to the extent necessary to limit total
expenses to an annual rate of 2.35% and 3.00% of average net assets of Class I
and II shares, respectively, through December 31, 1996. The amount of the reim-
bursement for the period ended March 31, 1996 is set forth in the Statement of
Operations. For the period ended March 31, 1996, FTD received net commissions
of $9,226 from the sale of the Fund's shares and FTIS received fees of $8,000.
Under the distribution plans for Class I and Class II shares, the Fund reim-
burses FTD quarterly for FTD's costs and expenses in connection with any activ-
ity that is primarily intended to result in a sale of Fund shares, subject to a
maximum of 0.35% and 1.00% per annum of the average daily net assets of Class I
and Class II shares, respectively. Under the Class I distribution plan, costs
and expenses exceeding the maximum may be reimbursed in subsequent periods. At
March 31, 1996, unreimbursed expenses amounted to $111,748. Class II shares re-
deemed within 18 months are subject to a contingent deferred sales charge. Con-
tingent deferred sales charges of $20 were paid to FTD for the period ended
March 31, 1996.
An officer of the Fund is a partner of Dechert Price & Rhoads, legal counsel
for the Fund, which firm received fees of $8,700 for the period ended March 31,
1996.
4. PURCHASES AND SALES OF SECURITIES
Purchases and sales of securities (excluding short-term securities) for the pe-
riod ended March 31, 1996 aggregated $5,236,839 and $77, respectively. The cost
of securities for federal income tax purposes is the same as that shown in the
Investment Portfolio. Realized gains and losses are reported on an identified
cost basis.
At March 31, 1996, the aggregate gross unrealized appreciation and depreciation
of portfolio securities, based on cost for federal income tax purposes, was as
follows:
<TABLE>
<CAPTION>
Unrealized appreciation $ 301,532
<S> <C>
Unrealized depreciation (108,989)
---------
Net unrealized appreciation $ 192,543
=========
</TABLE>
16
<PAGE>
Templeton Latin America Fund
Independent Auditor's Report
- --------------------------------------------------------------------------------
The Board of Trustees and Shareholders
Templeton Latin America Fund
We have audited the accompanying statement of assets and liabilities, including
the investment portfolio, of Templeton Latin America Fund as of March 31, 1996,
and the related statement of operations, the statement of changes in net assets
and the financial highlights for the period from May 8, 1995 (commencement of
operations) to March 31, 1996. These financial statements and financial high-
lights 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 audit.
We conducted our audit in accordance with generally accepted auditing stan-
dards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial high-
lights 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
March 31, 1996, by correspondence with the custodian and brokers. An audit also
includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement pre-
sentation. We believe that our audit provides a reasonable basis for our opin-
ion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of Tem-
pleton Latin America Fund as of March 31, 1996, the results of its operations,
the changes in its net assets and the financial highlights for the period indi-
cated, in conformity with generally accepted accounting principles.
/s/ McGladrey & Pullen, LLP
New York, New York
April 26, 1996
17
<PAGE>
Notes
-----
<PAGE>
The Franklin Templeton Group
Literature Request - Call today for a free descriptive brochure and prospectus
on any of the funds listed below. The prospectus contains more complete
information, including fees, charges and expenses, and should be read carefully
before investing or sending money.
<TABLE>
<S> <C> <C> <C>
Templeton Funds Florida* Franklin Funds Seeking Franklin Templeton Global
American Trust Georgia Growth and Income Currency Funds
Americas Government Hawaii** Balance Sheet German Government
Securities Indiana Investment Fund Bond
Developing Markets Trust Kentucky Convertible Securities Fund Global Currency
Foreign Fund Louisiana Equity Income Fund High Income Currency
Global Infrastructure Fund Maryland Global Utilities Fund Hard Currency
Global Opportunities Trust Massachusetts*** Income Fund Franklin Money
Greater European Fund Michigan*** MicroCap Value Market Funds
Growth Fund Minnesota*** Natural Resources Fund Money Fund
Growth and Income Fund Missouri Premier Return Fund Federal Money Fund
Global Bond Fund New Jersey Real Estate Securities Fund Tax-Exempt Money
Latin America Fund New York* Rising Dividends Fund Fund
Pacific Growth North Carolina Strategic Income Fund California Tax-Exempt
Global Real Estate Fund Ohio*** Utilities Fund Money Fund
Global Smaller Oregon Value New York Tax-Exempt
Company Fund Pennsylvania Money Fund
World Fund Tennessee Franklin Funds Seeking IFT U.S. Treasury Money
Texas High Current Income Market Portfolio
Franklin Funds Seeking Virginia AGE High Income Fund
Tax-Free Income Washington** Global Government Franklin Fund for Corporations
Federal Tax-Free Income Fund Corporate Qualified
Income Fund Franklin Funds Investment Grade Dividend Fund
Federal Intermediate-Term Seeking Capital Growth Income Fund
Tax-Free Income Fund California Growth Fund U.S. Government Franklin Tax-Deferred
High Yield DynaTech Fund Securities Fund Annuity
Insured Tax-Free Equity Fund Franklin Valuemark
Income Fund*** Global Health Care Franklin Funds Seeking Franklin Templeton
Puerto Rico Tax-Free Gold Fund High Current Income and Valuemark Income Plus
Income Fund Growth Fund Stability of Principal (an immediate annuity)
International Adjustable Rate
Franklin State-Specific Equity Fund Securities Fund
Funds Seeking Tax-Free Income Japan Fund Adjustable U.S. Government
Alabama Small Cap Growth Fund Securities Fund
Arizona* Short-Intermediate U.S.
Arkansas** Government
California* Securities Fund
Colorado
Connecticut Franklin Funds for
Non-U.S. Investors
Tax-Advantaged High Yield
Securities Fund
Tax-Advantaged International
Bond Fund
Tax-Advantaged U.S.
Government Securities Fund
</TABLE>
Fund Information: 1-800/342-5236
Shareholder Services: 1-800/632-2301
To ensure the highest quality of service, telephone calls to or from our service
departments may be monitored, recorded and accessed. These calls can be
determined by the presence of a regular beeping tone.
*Two or more fund options available: long-term portfolio, intermediate-term
portfolio, a portfolio of insured municipal securities, and a high yield
portfolio (CA).
**The fund may invest up to 100% of its assets in bonds that pay interest
subject to the federal alternative minimum tax.
***Portfolio of insured municipal securities.
<PAGE>
TEMPLETON LATIN
AMERICA FUND
Auditors
McGladrey & Pullen, LLP
555 Fifth Avenue
New York, New York 10017-2416
PRINCIPAL UNDERWRITER:
Franklin Templeton
Distributors, Inc.
700 Central Avenue
St. Petersburg,
Florida 33701-3628
Shareholder Services
1-800-632-2301
Fund Information
1-800-342-5236
This report must be
preceded or accompanied
by the current
prospectus of the
Templeton Latin America
Fund, which contains
more complete
information including
charges and expenses.
Like any investment in
securities, the value
of the Fund's portfolio
will be subject to the
risk of loss from
market, currency,
economic, political,
and other factors, as
well as investment
decisions by the
investment manager
which will not always
be profitable or wise.
The Fund and its
investors are not
protected from such
losses by the
investment manager.
Therefore, investors
who cannot accept this
risk should not invest
in shares of the Fund.
To ensure the highest
quality of service,
telephone calls to or
from our service
departments may be
monitored, recorded,
and accessed. These
calls can be determined
by the presence of
a regular beeping tone.
[RECYCLING LOGO APPEARS HERE]
TL418 A96 5/96
TEMPLETON
LATIN
AMERICA
FUND
Annual Report
March 31, 1996
[LOGO OF FRANKLIN TEMPLETON APPEARS HERE]
