UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File Number: 811-21219
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Eaton Vance Insured Municipal Bond Fund II
------------------------------------------
(Exact Name of registrant as Specified in Charter)
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109
-----------------------------------------------------------------------
(Address of Principal Executive Offices)
Alan R. Dynner
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109
-----------------------------------------------------------------------
(Name and Address of Agent for Services)
(617) 482-8260
--------------
(registrant's Telephone Number)
September 30
------------
Date of Fiscal Year End
March 31, 2004
--------------
Date of Reporting Period
ITEM 1. REPORTS TO STOCKHOLDERS
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File Number: 811-21217
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Eaton Vance Insured California II Municipal Bond Fund
-----------------------------------------------------
(Exact Name of registrant as Specified in Charter)
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109
-----------------------------------------------------------------------
(Address of Principal Executive Offices)
Alan R. Dynner
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109
-----------------------------------------------------------------------
(Name and Address of Agent for Services)
(617) 482-8260
--------------
(registrant's Telephone Number)
September 30
------------
Date of Fiscal Year End
March 31, 2004
--------------
Date of Reporting Period
ITEM 1. REPORTS TO STOCKHOLDERS
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File Number: 811-21222
---------
Eaton Vance Insured Florida Municipal Bond Fund
-----------------------------------------------
(Exact Name of registrant as Specified in Charter)
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109
-----------------------------------------------------------------------
(Address of Principal Executive Offices)
Alan R. Dynner
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109
-----------------------------------------------------------------------
(Name and Address of Agent for Services)
(617) 482-8260
--------------
(registrant's Telephone Number)
September 30
------------
Date of Fiscal Year End
March 31, 2004
--------------
Date of Reporting Period
ITEM 1. REPORTS TO STOCKHOLDERS
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File Number: 811-21225
---------
Eaton Vance Insured Massachusetts Municipal Bond Fund
-----------------------------------------------------
(Exact Name of registrant as Specified in Charter)
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109
-----------------------------------------------------------------------
(Address of Principal Executive Offices)
Alan R. Dynner
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109
-----------------------------------------------------------------------
(Name and Address of Agent for Services)
(617) 482-8260
--------------
(registrant's Telephone Number)
September 30
------------
Date of Fiscal Year End
March 31, 2004
--------------
Date of Reporting Period
ITEM 1. REPORTS TO STOCKHOLDERS
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File Number: 811-21224
---------
Eaton Vance Insured Michigan Municipal Bond Fund
------------------------------------------------
(Exact Name of registrant as Specified in Charter)
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109
-----------------------------------------------------------------------
(Address of Principal Executive Offices)
Alan R. Dynner
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109
-----------------------------------------------------------------------
(Name and Address of Agent for Services)
(617) 482-8260
--------------
(registrant's Telephone Number)
September 30
------------
Date of Fiscal Year End
March 31, 2004
--------------
Date of Reporting Period
ITEM 1. REPORTS TO STOCKHOLDERS
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File Number: 811-21229
---------
Eaton Vance Insured New Jersey Municipal Bond Fund
--------------------------------------------------
(Exact Name of registrant as Specified in Charter)
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109
-----------------------------------------------------------------------
(Address of Principal Executive Offices)
Alan R. Dynner
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109
-----------------------------------------------------------------------
(Name and Address of Agent for Services)
(617) 482-8260
--------------
(registrant's Telephone Number)
September 30
------------
Date of Fiscal Year End
March 31, 2004
--------------
Date of Reporting Period
ITEM 1. REPORTS TO STOCKHOLDERS
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File Number: 811-21218
---------
Eaton Vance Insured New York Municipal Bond Fund II
---------------------------------------------------
(Exact Name of registrant as Specified in Charter)
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109
-----------------------------------------------------------------------
(Address of Principal Executive Offices)
Alan R. Dynner
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109
-----------------------------------------------------------------------
(Name and Address of Agent for Services)
(617) 482-8260
--------------
(registrant's Telephone Number)
September 30
------------
Date of Fiscal Year End
March 31, 2004
--------------
Date of Reporting Period
ITEM 1. REPORTS TO STOCKHOLDERS
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File Number: 811-21226
---------
Eaton Vance Insured Ohio Municipal Bond Fund
--------------------------------------------
(Exact Name of registrant as Specified in Charter)
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109
-----------------------------------------------------------------------
(Address of Principal Executive Offices)
Alan R. Dynner
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109
-----------------------------------------------------------------------
(Name and Address of Agent for Services)
(617) 482-8260
--------------
(registrant's Telephone Number)
September 30
------------
Date of Fiscal Year End
March 31, 2004
--------------
Date of Reporting Period
ITEM 1. REPORTS TO STOCKHOLDERS
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File Number: 811-21227
---------
Eaton Vance Insured Pennsylvania Municipal Bond Fund
----------------------------------------------------
(Exact Name of registrant as Specified in Charter)
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109
-----------------------------------------------------------------------
(Address of Principal Executive Offices)
Alan R. Dynner
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109
-----------------------------------------------------------------------
(Name and Address of Agent for Services)
(617) 482-8260
--------------
(registrant's Telephone Number)
September 30
------------
Date of Fiscal Year End
March 31, 2004
--------------
Date of Reporting Period
ITEM 1. REPORTS TO STOCKHOLDERS
[EV LOGO]
[GRAPHIC IMAGE]
SEMIANNUAL REPORT MARCH 31, 2004
EATON VANCE INSURED MUNICIPAL BOND FUNDS
CLOSED-END FUNDS:
INSURED MUNICIPAL II
INSURED CALIFORNIA II
INSURED FLORIDA
INSURED MASSACHUSETTS
INSURED MICHIGAN
INSURED NEW JERSEY
INSURED NEW YORK II
INSURED OHIO
INSURED PENNSYLVANIA
EATON VANCE FUNDS
EATON VANCE MANAGEMENT
BOSTON MANAGEMENT AND RESEARCH
EATON VANCE DISTRIBUTORS, INC.
PRIVACY NOTICE
The Eaton Vance organization is committed to ensuring your financial privacy.
This notice is being sent to comply with privacy regulations of the Securities
and Exchange Commission. Each of the above financial institutions has in effect
the following policy with respect to nonpublic personal information about its
customers:
- Only such information received from you, through application forms or
otherwise, and information about your Eaton Vance fund transactions will be
collected.
- None of such information about you (or former customers) will be disclosed to
anyone, except as permitted by law (which includes disclosure to employees
necessary to service your account).
- Policies and procedures (including physical, electronic and procedural
safeguards) are in place that are designed to protect the confidentiality of
such information.
For more information about Eaton Vance's privacy policies, call: 1-800-262-1122.
IMPORTANT NOTICE
REGARDING DELIVERY OF
SHAREHOLDER DOCUMENTS
The Securities and Exchange Commission permits funds to deliver only one copy of
shareholder documents, including prospectuses, proxy statements and shareholder
reports, to fund investors with multiple accounts at the same residential or
post office box address. This practice is often called "householding" and it
helps eliminate duplicate mailings to shareholders.
EATON VANCE, OR YOUR FINANCIAL ADVISER, MAY HOUSEHOLD THE MAILING OF YOUR
DOCUMENTS INDEFINITELY UNLESS YOU INSTRUCT EATON VANCE, OR YOUR FINANCIAL
ADVISER, OTHERWISE.
If you would prefer that your Eaton Vance documents not be householded, please
contact Eaton Vance at 1-800-262-1122, or contact your financial adviser.
Your instructions that householding not apply to delivery of your Eaton Vance
documents will be effective within 30 days of receipt by Eaton Vance or your
financial adviser.
From time to time, funds are required to vote proxies related to the securities
held by the funds. The Eaton Vance Funds or their underlying Portfolios vote
proxies according to a set of policies and procedures approved by the Funds' and
Portfolios' Boards. You may obtain a description of these policies and
procedures without charge, upon request, by calling 1-800-262-1122. This
description is also available on the Securities and Exchange Commission's
website at http://www.sec.gov.
EATON VANCE INSURED MUNICIPAL BOND FUNDS as of March 31, 2004
LETTER TO SHAREHOLDERS
[PHOTO OF THOMAS J. FETTER]
Thomas J. Fetter
President
Amid the market volatility of recent years, many investors have become more
concerned with risk management. That trend has been especially true in the
municipal bond market, where the use of bond insurance has become increasingly
common. Today, roughly half of all municipal bond issuance is composed of
insured bonds. As part of our continuing educational series, we thought it might
be helpful to discuss bond insurance and its impact on the municipal market.
THE USE OF BOND INSURANCE HAS GROWN DRAMATICALLY OVER THE YEARS...
Municipal bond insurance was initially developed in 1971, when AMBAC Assurance
Corp., the nation's first municipal insurer, offered insurance as a way to
guarantee principal and interest payments on bond issues in the event of a bond
default. Over the following three decades, the municipal market has witnessed a
surge in the use of insurance. For example, in 1980, just 3% of all municipal
issuance was insured. However, by late 2003, that figure had risen to roughly
50%. Insurance has clear benefits for purchasers: the elimination of default
risk of the underlying issuer, AAA quality ratings and an enhancement of an
issue's liquidity. (It's important to note that, while insured bonds are insured
as to principal and interest payments, they still remain subject to interest
rate and market risks.)
THE MECHANICS OF MUNICIPAL BOND INSURANCE...
We start with the underlying reality that an issuer with a AAA credit rating
will pay less in interest expense than an issuer with a lower credit rating.
Thus, an issuer must first determine whether purchasing insurance is financially
feasible. That is, will the interest savings offset the cost of insurance? If
so, the issuer must then qualify for insurance. Just as an individual must
qualify for insurance, so must a bond issuer meet certain criteria. The issuer
provides key financial data and documents to potential insurers that are then
used to assess the issuer's financial strength and underlying fundamentals. If
the issuer qualifies, insurance is then effected by "direct purchase," with the
payment of a one-time premium by the issuer. The premium fee is calculated as a
percentage of the value of the bond issue - typically, around 50 basis points
(0.50%), but more if the credit entails higher risk. (An alternative method of
purchase involves "elective bidding," in which the insurance is purchased by
bond dealers, who determine at the time the bond is sold whether it is more
attractive as an insured or uninsured bond.)
IN-DEPTH CREDIT ANALYSIS INCLUDES INSURERS AS WELL AS BOND ISSUERS...
When analyzing municipal bonds, an investor naturally researches the
issuer's fundamentals. However, if the bond is insured, the analyst is concerned
with the soundness of the insurer as well. At Eaton Vance, analysis of the
insured segment is an integral part of our total municipal research effort.
Research includes, among other areas, analysis of an insurer's claims-paying
ability, its capital structure and the overall quality of its portfolio of
policies. Based on claims-paying ability, there are currently six bond insurers
rated AAA by Moody's Investors Service, Standard & Poor's and Fitch Ratings -
the nation's leading rating agencies.
INSURERS CAN PLAY A VALUABLE ROLE IN STRUCTURING BOND DEALS AND IMPROVING CREDIT
QUALITY...
Insurers play an important role in capital formation for municipal borrowers,
working closely with municipal officials to forge deals that raise capital for
vital projects at affordable interest rates. In so doing, the insurers can help
states and municipalities achieve more efficient fiscal management. Insurers
often re-structure bond deals by insisting on provisions that are intended to
make the deal more secure. That has proved a major benefit to investors in
recent years. In a more risk-conscious climate, we believe that an ongoing
analysis of the insured market is a necessary discipline to invest successfully
in today's municipal market.
Sincerely,
/s/ Thomas J. Fetter
Thomas J. Fetter
President
May 10, 2004
SHARES OF THE FUNDS ARE NOT INSURED BY THE FDIC AND ARE NOT DEPOSITS OR OTHER
OBLIGATIONS OF, OR GUARANTEED BY, ANY DEPOSITORY INSTITUTION. SHARES ARE SUBJECT
TO INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL INVESTED. YIELDS WILL
VARY.
2
EATON VANCE INSURED MUNICIPAL BOND FUNDS as of March 31, 2004
MARKET RECAP
U.S. economic activity continued to make progress in the six months ended March
31, 2004, although the pace of the recovery was a topic of strong debate.
Businesses increased capital spending, reinvesting in plants and equipment.
Meanwhile, consumer spending remained very resilient, despite deepening concerns
over the continuing conflict in Iraq, slow job growth and sharply rising
gasoline prices. However, the investment climate remained generally positive
and, against this backdrop, the bond market generated solid returns during the
period.
THE CONSTRUCTION AND BUSINESS SERVICE SECTORS WERE AMONG THE LEADERS IN JOB
GROWTH...
Construction employment, while subject to seasonal fluctuations, contributed
strongly to the economy. Gains were also seen in the service sector, where
business services, health care, education, retailing and leisure showed
strength. Interestingly, temporary employment agencies reported some weakness,
suggesting that employers may be increasingly inclined to begin hiring permanent
employees. The manufacturing sector remained lackluster. However, hopes rose
that recent trends showing less deterioration might mark an end to the
relentless job losses dating to 2000.
WHILE KEEPING INTEREST RATES AT A RECORD LOW, THE FEDERAL RESERVE CONTINUED TO
MONITOR THE ECONOMY CLOSELY FOR INFLATION...
The nation's Gross Domestic Product grew by 4.2% in the first quarter of 2004,
following a 4.1% rise in the fourth quarter of 2003. While the data suggested a
sound overall economy, the the slow pace of job creation remained a concern. The
nation's unemployment rate was 5.7% in March 2004, down just 0.1% from 5.8% a
year earlier. Recent labor market data have been unusually volatile. The Federal
Reserve is likely to keep a close eye on future jobs reports - as well as prices
of key commodities and consumer goods - for signs of a return of inflation. Late
in the period, inflation appeared to be edging somewhat higher, especially
energy, transportation and clothing costs. Nevertheless, through March, the
Federal Reserve held its Federal Funds rate - a key short-term interest rate
barometer - at 1.00%, where it has stood since June 2003.
MUNICIPAL BOND YIELDS NEARLY EQUALLED TREASURY YIELDS
[CHART]
30-Year AAA-rated
General Obligation (GO) Bonds* 4.75%
Taxable equivalent yield
in 35.0% tax bracket 7.31%
30-Year Treasury Bond 4.77%
Principal and interest payments of Treasury securities are guaranteed by the
U.S. government.
*GO yields are a compilation of a representative variety of general obligations
and are not necessarily representative of the Funds' yield. Statistics as of
March 31, 2004.
Past performance is no guarantee of future results.
Source: Bloomberg, L.P.
The municipal bond market performed generally in line with the Treasury market
during the six-month period ended March 31, 2004. Ten-year Treasury bond yields
- which were around 3.93% at September 30, 2003 - declined to 3.83% by March 31,
2004, while 10-year municipal yields fell from 3.76% to 3.64%. The Lehman
Brothers Municipal Bond Index posted a total return of 3.12% for the six months
ended March 31, 2004.*
STATE TAX RATES ROSE AGAIN IN 2003, INCREASING THE BURDEN ON STATE TAXPAYERS...
While federal taxes declined, state taxes rose significantly in 2002 and 2003,
according to the Tax Foundation. Over the past decade, the fastest growing
category of state tax collections was individual income taxes, which rose at an
average annual rate of 7.7%. That trend has left taxpayers with a larger state
tax bill and made a strong case for municipal bonds as one of the few remaining
ways to pare one's tax burden. Thus, we continue to believe that municipal bonds
remain a worthwhile consideration for tax-conscious investors.
* It is not possible to invest directly in an Index.
THE VIEWS EXPRESSED THROUGHOUT THIS REPORT ARE THOSE OF THE VARIOUS PORTFOLIO
MANAGERS AND ARE CURRENT ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS
STATED ON THE COVER. THESE VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED UPON
MARKET OR OTHER CONDITIONS, AND EATON VANCE DISCLAIMS ANY RESPONSIBILITY TO
UPDATE SUCH VIEWS. THESE VIEWS MAY NOT BE RELIED ON AS INVESTMENT ADVICE AND,
BECAUSE INVESTMENT DECISIONS FOR AN EATON VANCE FUND ARE BASED ON MANY FACTORS,
MAY NOT BE RELIED ON AS AN INDICATION OF TRADING INTENT ON BEHALF OF ANY EATON
VANCE FUND.
3
EATON VANCE INSURED MUNICIPAL BOND FUND II as of March 31, 2004
INVESTMENT UPDATE
[PHOTO OF THOMAS J. FETTER]
Thomas J. Fetter
Portfolio Manager
MANAGEMENT UPDATE
- While some measures suggested the U.S. economy was slowly recovering, job
growth remained sluggish. The nation's manufacturing sector continued to
shed jobs, while global outsourcing took an increasing toll on the
technology and service sectors. The nation's jobless rate was 5.7% in March
2004, down from 5.8% a year ago.
- Insured* transportation bonds constituted the Fund's largest sector
weighting at March 31, 2004. The Fund's holdings were well diversified by
geographic region and by project type. Investments included projects for
rapid transit, toll bridges, highways, a monorail and an urban skywalk.
- Insured* general obligation bonds (GOs) were notable investments for the
Fund. These issues represented high quality at a time when revenues for
industrial and economically-sensitive issuers were less certain.
- Insured* water and sewer issuers were large investments. Large population
growth in selected areas, such as Atlanta, has escalated the pace of
residential building, increasing the need for water and wastewater
improvements. That trend has resulted in additional opportunities within
this sector.
- The Fund made structural changes, as necessary, to adjust to changing
market conditions. Management maintained a well-diversified investment mix,
emphasizing diversification according to sector, issuer and coupon.
FUND STATISTICS(1)
- Number of Issues: 55
- Effective Maturity: 11.1 years
- Average Rating: AAA
- Average Call: 10.8 years
- Average Dollar Price: $94.94
THE FUND
PERFORMANCE FOR THE PAST SIX MONTHS
- Based on share price (traded on the American Stock Exchange), the Fund had
a total return of 15.34% for the six months ended March 31, 2004. That
return was the result of an increase in share price to $15.45 on March 31,
2004 from $14.00 on September 30, 2003, and the reinvestment of $0.500 in
regular monthly dividends and $0.158 in capital gain distributions.(3)
- Based on net asset value, the Fund had a total return of 4.02% for the six
months ended March 31, 2004. That return was the result of a decrease in
net asset value to $14.72 on March 31, 2004 from $14.79 on September 30,
2003, and the reinvestment of all distributions.(3)
- Based on the most recent dividend and a share price of $15.45, the Fund had
a market yield of 6.48% at March 31, 2004.(4) The Fund's market yield is
equivalent to a taxable yield of 9.97%.(5)
[CHART]
RATING DISTRIBUTION(1),(2)
By total investments
Non-Rated 1.0%
A 3.0%
A 4.7%
AA 5.8%
AAA 85.5%
FUND INFORMATION
AS OF MARCH 31, 2004
PERFORMANCE(6)
Average Annual Total Returns (by share price, American Stock Exchange)
One year 16.70%
Life of Fund (11/29/02) 13.45
Average Annual Total Returns (by net asset value)
One year 7.79%
Life of Fund (11/29/02) 9.42
(1) FUND STATISTICS AND RATING DISTRIBUTION ARE SUBJECT TO CHANGE.
(2) RATING DISTRIBUTION IS DETERMINED BY DIVIDING THE TOTAL MARKET VALUE OF THE
ISSUES BY THE TOTAL INVESTMENTS OF THE FUND.
(3) A PORTION OF THE FUND'S INCOME MAY BE SUBJECT TO FEDERAL AND STATE INCOME
TAX.
(4) THE FUND'S MARKET YIELD IS CALCULATED BY DIVIDING THE MOST RECENT DIVIDEND
PER SHARE BY THE SHARE PRICE AT THE END OF THE PERIOD AND ANNUALIZING THE
RESULT.
(5) TAXABLE-EQUIVALENT YIELD ASSUMES MAXIMUM 35.00% FEDERAL INCOME TAX RATE. A
LOWER RATE WOULD RESULT IN A LOWER TAX-EQUIVALENT FIGURE.
(6) RETURNS ARE HISTORICAL AND ARE CALCULATED BY DETERMINING THE PERCENTAGE
CHANGE IN SHARE PRICE OR NET ASSET VALUE WITH ALL DISTRIBUTIONS REINVESTED.
PERFORMANCE RESULTS REFLECT THE EFFECT OF LEVERAGE RESULTING FROM THE
FUND'S ISSUANCE OF AUCTION PREFERRED SHARES.
* PRIVATE INSURANCE DOES NOT REMOVE THE RISK OF LOSS OF PRINCIPAL ASSOCIATED
WITH INSURED INVESTMENTS DUE TO CHANGES IN MARKET CONDITIONS.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. INVESTMENT RETURN AND
SHARE PRICE WILL FLUCTUATE SO THAT SHARES, WHEN SOLD, MAY BE WORTH MORE OR
LESS THAN THEIR ORIGINAL COST. PERFORMANCE IS FOR THE STATED TIME PERIOD
ONLY; DUE TO MARKET VOLATILITY, THE FUND'S CURRENT PERFORMANCE MAY BE LOWER
OR HIGHER THAN QUOTED RETURN.
4
EATON VANCE INSURED CALIFORNIA MUNICIPAL BOND FUND II as of March 31, 2004
INVESTMENT UPDATE
[PHOTO OF CYNTHIA J. CLEMSON]
Cynthia J. Clemson
Portfolio Manager
MANAGEMENT UPDATE
- The California economy saw stagnant job growth in 2003, as the
manufacturing, government, information and entertainment sectors struggled.
Construction, financial services, leisure, tourism and selected service
sectors led the way in job creation. The state's March 2004 jobless rate
was 6.5%, down from 6.8% a year ago.
- Against the backdrop of a slow-to-recover state economy, insured* general
obligation bonds were the Fund's largest sector weightings at March 31,
2004. In a slow economy, insured* bonds provided an extra measure of
security against the possibility of declining municipal or state revenues.
- Insured* lease revenue/certificates of participation (COPs) were large
investments for the Fund. Through COPs, communities are able to finance
their needs in a flexible and cost-effective manner.
- Insured* special assessment revenue bonds provided an attractive income
stream. These issues provide California communities flexibility in
financing a wide variety of public initiatives and infrastructure-related
projects.
- With continued low interest rates, management continued to emphasize coupon
structure and call features, as market conditions dictated. Coupon
structure and call features can have a significant influence on the Fund's
performance.
FUND STATISTICS(1)
- Number of Issues: 42
- Effective Maturity: 8.7 years
- Average Rating: AAA
- Average Call: 8.2 years
- Average Dollar Price: $98.12
THE FUND
PERFORMANCE FOR THE PAST SIX MONTHS
- Based on share price (traded on the American Stock Exchange), the Fund had
a total return of 12.37% for the six months ended March 31, 2004. That
return was the result of an increase in share price to $14.96 on March 31,
2004 from $13.80 on September 30, 2003, and the reinvestment of $0.474 in
regular monthly dividends and $0.060 in capital gain distributions.(3)
- Based on net asset value, the Fund had a total return of 6.86% for the six
months ended March 31, 2004. That return was the result of an increase in
net asset value to $15.01 on March 31, 2004 from $14.56 on September 30,
2003, and the reinvestment of all distributions.(3)
- Based on the most recent dividend and a share price of $14.96, the Fund had
a market yield of 6.34% at March 31, 2004.(4) The Fund's market yield is
equivalent to a taxable yield of 10.75%.(5)
[CHART]
RATING DISTRIBUTION(1),(2)
By total investments
BBB 1.9%
A 1.7%
AA 2.8%
AAA 93.6%
FUND INFORMATION
AS OF MARCH 31, 2004
PERFORMANCE(6)
Average Annual Total Returns (by share price, American Stock Exchange)
One year 14.76%
Life of Fund (11/29/02) 9.95
Average Annual Total Returns (by net asset value)
One year 9.86%
Life of Fund (11/29/02) 10.23
(1) FUND STATISTICS AND RATING DISTRIBUTION ARE SUBJECT TO CHANGE.
(2) RATING DISTRIBUTION IS DETERMINED BY DIVIDING THE TOTAL MARKET VALUE OF THE
ISSUES BY THE TOTAL INVESTMENTS OF THE FUND.
(3) A PORTION OF THE FUND'S INCOME MAY BE SUBJECT TO FEDERAL AND STATE INCOME
TAX.
(4) THE FUND'S MARKET YIELD IS CALCULATED BY DIVIDING THE MOST RECENT DIVIDEND
PER SHARE BY THE SHARE PRICE AT THE END OF THE PERIOD AND ANNUALIZING THE
RESULT.
(5) TAXABLE-EQUIVALENT YIELD ASSUMES MAXIMUM 41.05% FEDERAL AND STATE INCOME
TAX RATE. A LOWER RATE WOULD RESULT IN A LOWER TAX-EQUIVALENT FIGURE.
(6) RETURNS ARE HISTORICAL AND ARE CALCULATED BY DETERMINING THE PERCENTAGE
CHANGE IN SHARE PRICE OR NET ASSET VALUE WITH ALL DISTRIBUTIONS REINVESTED.
PERFORMANCE RESULTS REFLECT THE EFFECT OF LEVERAGE RESULTING FROM THE
FUND'S ISSUANCE OF AUCTION PREFERRED SHARES.
* PRIVATE INSURANCE DOES NOT REMOVE THE RISK OF LOSS OF PRINCIPAL ASSOCIATED
WITH INSURED INVESTMENTS DUE TO CHANGES IN MARKET CONDITIONS.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. INVESTMENT RETURN AND
SHARE PRICE WILL FLUCTUATE SO THAT SHARES, WHEN SOLD, MAY BE WORTH MORE OR
LESS THAN THEIR ORIGINAL COST. PERFORMANCE IS FOR THE STATED TIME PERIOD
ONLY; DUE TO MARKET VOLATILITY, THE FUND'S CURRENT PERFORMANCE MAY BE LOWER
OR HIGHER THAN QUOTED RETURN.
5
EATON VANCE INSURED FLORIDA MUNICIPAL BOND FUND as of March 31, 2004
INVESTMENT UPDATE
[PHOTO OF CYNTHIA J. CLEMSON]
Cynthia J. Clemson
Portfolio Manager
MANAGEMENT UPDATE
- While Florida's economy registered only modest job growth in late 2003 and
early 2004, it nonetheless managed to outpace the nation as a whole. The
state's key tourism sector and its construction sector - fueled by a
surging housing market - have been the primary drivers of job growth. The
state's jobless rate was 4.8% in March 2004, down from 5.3% a year ago.
- Insured* special tax revenue bonds were the Fund's largest sector weighting
at March 31, 2004. These bonds are secured by the levy of special
assessments by local governments, and helped defray costs on improvements
or infrastructures that benefited local property owners.
- Management also found opportunities in non-sector-specific bonds. These
insured* miscellaneous bonds included issues for a variety of tourism,
housing, transportation and entertainment-related projects for communities
throughout Florida.
- The Fund remained selective within the hospital sector. With the industry
facing the pressure of strict Medicare reimbursement, the Fund focused on
insured* issues of institutions management believes have superior
management and a solid market share.
- Management emphasized diversification by issuer, sector and coupon.
Selected insured* Puerto Rico bonds added further flexibility in this
regard and included general obligations, electric utilities, lease revenue,
transportation and special tax revenue bonds.
FUND STATISTICS(1)
- Number of Issues: 44
- Effective Maturity: 10.7 years
- Average Rating: AAA
- Average Call: 10.0 years
- Average Dollar Price: $102.08
THE FUND
PERFORMANCE FOR THE PAST SIX MONTHS
- Based on share price (traded on the American Stock Exchange), the Fund had
a total return of 11.20% for the six months ended March 31, 2004. That
return was the result of an increase in share price to $15.11 on March 31,
2004 from $14.10 on September 30, 2003, and the reinvestment of $0.465 in
regular monthly dividends and $0.080 in capital gain distributions.(3)
- Based on net asset value, the Fund had a total return of 6.83% for the six
months ended March 31, 2004. That return was the result of an increase in
net asset value to $14.98 on March 31, 2004 from $14.55 on September 30,
2003, and the reinvestment of all distributions.(3)
- Based on the most recent dividend and a share price of $15.11, the Fund had
a market yield of 6.15% at March 31, 2004.(4) The Fund's market yield is
equivalent to a taxable yield of 9.46%.(5)
[CHART]
RATING DISTRIBUTION(1),(2)
By total investments
A 1.8%
AA 5.2%
AAA 93.0%
FUND INFORMATION
AS OF MARCH 31, 2004
PERFORMANCE(6)
Average Annual Total Returns (by share price, American Stock Exchange)
One year 10.37%
Life of Fund (11/29/02) 10.72
Average Annual Total Returns (by net asset value)
One year 9.50%
Life of Fund (11/29/02) 10.01
(1) FUND STATISTICS AND RATING DISTRIBUTION ARE SUBJECT TO CHANGE.
(2) RATING DISTRIBUTION IS DETERMINED BY DIVIDING THE TOTAL MARKET VALUE OF THE
ISSUES BY THE TOTAL INVESTMENTS OF THE FUND.
(3) A PORTION OF THE FUND'S INCOME MAY BE SUBJECT TO FEDERAL INCOME AND STATE
INTANGIBLES TAX.
(4) THE FUND'S MARKET YIELD IS CALCULATED BY DIVIDING THE MOST RECENT DIVIDEND
PER SHARE BY THE SHARE PRICE AT THE END OF THE PERIOD AND ANNUALIZING THE
RESULT.
(5) TAXABLE-EQUIVALENT YIELD ASSUMES MAXIMUM 35.00% FEDERAL INCOME AND STATE
INTANGIBLES TAX RATE. A LOWER RATE WOULD RESULT IN A LOWER TAX-EQUIVALENT
FIGURE.
(6) RETURNS ARE HISTORICAL AND ARE CALCULATED BY DETERMINING THE PERCENTAGE
CHANGE IN SHARE PRICE OR NET ASSET VALUE WITH ALL DISTRIBUTIONS REINVESTED.
PERFORMANCE RESULTS REFLECT THE EFFECT OF LEVERAGE RESULTING FROM THE
FUND'S ISSUANCE OF AUCTION PREFERRED SHARES.
* PRIVATE INSURANCE DOES NOT REMOVE THE RISK OF LOSS OF PRINCIPAL ASSOCIATED
WITH INSURED INVESTMENTS DUE TO CHANGES IN MARKET CONDITIONS.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. INVESTMENT RETURN AND
SHARE PRICE WILL FLUCTUATE SO THAT SHARES, WHEN SOLD, MAY BE WORTH MORE OR
LESS THAN THEIR ORIGINAL COST. PERFORMANCE IS FOR THE STATED TIME PERIOD
ONLY; DUE TO MARKET VOLATILITY, THE FUND'S CURRENT PERFORMANCE MAY BE LOWER
OR HIGHER THAN QUOTED RETURN.
6
EATON VANCE INSURED MASSACHUSETTS MUNICIPAL BOND FUND as of March 31, 2004
INVESTMENT UPDATE
[PHOTO OF ROBERT B. MACINTOSH]
Robert B. MacIntosh
Portfolio Manager
MANAGEMENT UPDATE
- The Massachusetts economy has bounced back somewhat from the severe job
declines suffered following the 2001 recession. However, employment in the
technology and finance sectors, which drove the Commonwealth's economy in
the previous decade, remained well below its pre-recession peak. The
state's March 2004 jobless rate was 5.1%, down from 5.9% a year ago.
- Insured* private education bonds remained the Fund's largest weighting at
March 31, 2004. Management was able to take advantage of fairly active new
issuance of education issues. The Fund's investments included some of the
Commonwealth's most renowned colleges and universities.
- Insured* general obligation bonds (GOs) were a significant investment. With
some communities facing revenue shortfalls, the risk of downgrades has
risen commensurately. Insured* GOs represented high quality and a partial
refuge from those pressures.
- Insured* lease revenue/certificates of participation remained large
investments for the Fund. These agreements provide combined financing for
communities, affording them a flexible and cost-effective funding source
for joint borrowers.
- The Fund took advantage of strong retail demand as an opportunity to sell
premium coupon bonds in favor of current coupon issues. Management
continued to emphasize diversification according to issuer, sector and
insurer.
FUND STATISTICS(1)
- Number of Issues: 34
- Effective Maturity: 9.8 years
- Average Rating: AAA
- Average Call: 9.5 years
- Average Dollar Price: $101.14
THE FUND
PERFORMANCE FOR THE PAST SIX MONTHS
- Based on share price (traded on the American Stock Exchange), the Fund had
a total return of 16.24% for the six months ended March 31, 2004. That
return was the result of an increase in share price to $16.03 on March 31,
2004 from $14.45 on September 30, 2003, and the reinvestment of $0.474 in
regular monthly dividends and $0.225 in capital gain distributions.(3)
- Based on net asset value, the Fund had a total return of 6.56% for the six
months ended March 31, 2004. That return was the result of an increase in
net asset value to $14.92 on March 31, 2004 from $14.67 on September 30,
2003, and the reinvestment of all distributions.(3)
- Based on the most recent dividend and a share price of $16.03, the Fund had
a market yield of 5.91% at March 31, 2004.(4) The Fund's market yield is
equivalent to a taxable yield of 9.60%.(5)
[CHART]
RATING DISTRIBUTION(1)
By total investments
BBB 2.7%
A 1.9%
AA 7.7%
AAA 87.7%
FUND INFORMATION
AS OF MARCH 31, 2004
PERFORMANCE(6)
Average Annual Total Returns (by share price, American Stock Exchange)
One year 13.92%
Life of Fund (11/29/02) 16.53
Average Annual Total Returns (by net asset value)
One year 10.23%
Life of Fund (11/29/02) 10.46
(1) FUND STATISTICS AND RATING DISTRIBUTION ARE SUBJECT TO CHANGE.
(2) RATING DISTRIBUTION IS DETERMINED BY DIVIDING THE TOTAL MARKET VALUE OF THE
ISSUES BY THE TOTAL INVESTMENTS OF THE FUND.
(3) A PORTION OF THE FUND'S INCOME MAY BE SUBJECT TO FEDERAL AND STATE INCOME
TAX.
(4) THE FUND'S MARKET YIELD IS CALCULATED BY DIVIDING THE MOST RECENT DIVIDEND
PER SHARE BY THE SHARE PRICE AT THE END OF THE PERIOD AND ANNUALIZING THE
RESULT.
(5) TAXABLE-EQUIVALENT YIELD ASSUMES MAXIMUM 38.45% FEDERAL AND STATE INCOME
TAX RATE. A LOWER RATE WOULD RESULT IN A LOWER TAX-EQUIVALENT FIGURE.
(6) RETURNS ARE HISTORICAL AND ARE CALCULATED BY DETERMINING THE PERCENTAGE
CHANGE IN SHARE PRICE OR NET ASSET VALUE WITH ALL DISTRIBUTIONS REINVESTED.
PERFORMANCE RESULTS REFLECT THE EFFECT OF LEVERAGE RESULTING FROM THE
FUND'S ISSUANCE OF AUCTION PREFERRED SHARES.
* PRIVATE INSURANCE DOES NOT REMOVE THE RISK OF LOSS OF PRINCIPAL ASSOCIATED
WITH INSURED INVESTMENTS DUE TO CHANGES IN MARKET CONDITIONS.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. INVESTMENT RETURN AND
SHARE PRICE WILL FLUCTUATE SO THAT SHARES, WHEN SOLD, MAY BE WORTH MORE OR
LESS THAN THEIR ORIGINAL COST. PERFORMANCE IS FOR THE STATED TIME PERIOD
ONLY; DUE TO MARKET VOLATILITY, THE FUND'S CURRENT PERFORMANCE MAY BE LOWER
OR HIGHER THAN QUOTED RETURN.
7
EATON VANCE INSURED MICHIGAN MUNICIPAL BOND FUND as of March 31, 2004
INVESTMENT UPDATE
[PHOTO OF WILLIAM H. AHERN]
William H. Ahern
Portfolio Manager
MANAGEMENT UPDATE
- The Michigan economy continued to see signs of weakness in early 2004, as
manufacturing remained in a slump. Major automakers reported that
automobile production levels in early 2004 were below those of 2003. The
construction sector was mixed, with residential much stronger than the
commercial segment. The state's March 2004 jobless rate was 6.9%, down from
7.0% a year ago.
- Insured* general obligation bonds (GOs) were the Fund's largest sector
weighting at March 31, 2004. The Fund's holdings were represented by larger
urban issuers and small towns alike, and included issues for school
districts and building authorities.
- As elsewhere in the nation, the Michigan hospital industry remains under
the pressure of strict Medicare reimbursement. Hospital issues constituted
a significant investment, with the focus on hospital finance authority
issues that funded the acquisition, construction and improvement of
well-situated acute care facilities.
- The Fund took advantage of opportunities in insured* special tax revenue
bonds. The Fund's investments included projects for building development
programs, as well as an issue supporting hotel construction at Detroit's
Metropolitan Airport.
- Amid continued low interest rates, management continued to adjust coupon
structure and monitor call characteristics. Coupons and call features can
impact the Fund's performance as interest rates change.
FUND STATISTICS(1)
- Number of Issues: 33
- Effective Maturity: 9.9 years
- Average Rating: AAA
- Average Call: 9.4 years
- Average Dollar Price: $96.74
THE FUND
PERFORMANCE FOR THE PAST SIX MONTHS
- Based on share price (traded on the American Stock Exchange), the Fund had
a total return of 17.06% for the six months ended March 31, 2004. That
return was the result of an increase in share price to $16.35 on March 31,
2004 from $14.41 on September 30, 2003, and the reinvestment of $0.474 in
regular monthly dividends.(3)
- Based on net asset value, the Fund had a total return of 6.16% for the six
months ended March 31, 2004. That return was the result of an increase in
net asset value to $14.94 on March 31, 2004 from $14.52 on September 30,
2003, and the reinvestment of all distributions.(3)
- Based on the most recent dividend and a share price of $16.35, the Fund had
a market yield of 5.80% at March 31, 2004.(4) The Fund's market yield is
equivalent to a taxable yield of 9.29%.(5)
[CHART]
RATING DISTRIBUTION(1),(2)
By total investments
A 13.7%
AA 4.4%
AAA 81.9%
FUND INFORMATION
AS OF MARCH 31, 2004
PERFORMANCE(6)
Average Annual Total Returns (by share price, American Stock Exchange)
One year 15.32%
Life of Fund (11/29/02) 16.91
Average Annual Total Returns (by net asset value)
One year 8.62%
Life of Fund (11/29/02) 9.30
(1) FUND STATISTICS AND RATING DISTRIBUTION ARE SUBJECT TO CHANGE.
(2) RATING DISTRIBUTION IS DETERMINED BY DIVIDING THE TOTAL MARKET VALUE OF THE
ISSUES BY THE TOTAL INVESTMENTS OF THE FUND.
(3) A PORTION OF THE FUND'S INCOME MAY BE SUBJECT TO FEDERAL AND STATE INCOME
TAX.
(4) THE FUND'S MARKET YIELD IS CALCULATED BY DIVIDING THE MOST RECENT DIVIDEND
PER SHARE BY THE SHARE PRICE AT THE END OF THE PERIOD AND ANNUALIZING THE
RESULT.
(5) TAXABLE-EQUIVALENT YIELD ASSUMES MAXIMUM 37.60% FEDERAL AND STATE INCOME
TAX RATE. A LOWER RATE WOULD RESULT IN A LOWER TAX-EQUIVALENT FIGURE.
(6) RETURNS ARE HISTORICAL AND ARE CALCULATED BY DETERMINING THE PERCENTAGE
CHANGE IN SHARE PRICE OR NET ASSET VALUE WITH ALL DISTRIBUTIONS REINVESTED.
PERFORMANCE RESULTS REFLECT THE EFFECT OF LEVERAGE RESULTING FROM THE
FUND'S ISSUANCE OF AUCTION PREFERRED SHARES.
* PRIVATE INSURANCE DOES NOT REMOVE THE RISK OF LOSS OF PRINCIPAL ASSOCIATED
WITH INSURED INVESTMENTS DUE TO CHANGES IN MARKET CONDITIONS.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. INVESTMENT RETURN AND
SHARE PRICE WILL FLUCTUATE SO THAT SHARES, WHEN SOLD, MAY BE WORTH MORE OR
LESS THAN THEIR ORIGINAL COST. PERFORMANCE IS FOR THE STATED TIME PERIOD
ONLY; DUE TO MARKET VOLATILITY, THE FUND'S CURRENT PERFORMANCE MAY BE LOWER
OR HIGHER THAN QUOTED RETURN.
8
EATON VANCE INSURED NEW JERSEY MUNICIPAL BOND FUND as of March 31, 2004
INVESTMENT UPDATE
[PHOTO OF ROBERT B. MACINTOSH]
Robert B. MacIntosh
Portfolio Manager
MANAGEMENT UPDATE
- New Jersey's economy continued to produce jobs faster than the nation as a
whole. Among the state's stronger sectors were education, health care,
retail, government, and professional and business services, while
information, utilities and transportation lagged. The state's March 2004
jobless rate was 5.2%, down from 6.1% a year ago.
- Insured* public education bonds were the Fund's largest sector weighting at
March 31, 2004. The Fund's investments included an issue for the state's
University of Medicine and Dentistry, which trains students for careers in
internal and osteopathic medicine, dentistry and a range of allied health
professions.
- Insured* general obligation bonds (GOs) were in ample supply. The Fund's
investments represented a geographical mix consisting of urban areas and
smaller communities, with a main focus on board of education bonds.
- The Fund identified some opportunities in insured* transportation bonds.
The Fund's investments included issues for the massive Port Authority in
the metropolitan New York area, as well as transportation authorities in
the southern portion of the state.
- The Fund took advantage of strong retail demand as an opportunity to sell
premium coupon bonds in favor of current coupon issues. Management
continued to emphasize diversification according to issuer, sector and
insurer.
FUND STATISTICS(1)
- Number of Issues: 39
- Effective Maturity: 11.8 years
- Average Rating: AAA
- Average Call: 10.9 years
- Average Dollar Price: $94.61
THE FUND
PERFORMANCE FOR THE PAST SIX MONTHS
- Based on share price (traded on the American Stock Exchange), the Fund had
a total return of 14.64% for the six months ended March 31, 2004. That
return was the result of an increase in share price to $15.91 on March 31,
2004 from $14.52 on September 30, 2003, and the reinvestment of $0.480 in
regular monthly dividends and $0.206 in capital gain distributions.(3)
- Based on net asset value, the Fund had a total return of 8.24% for the six
months ended March 31, 2004. That return was the result of an increase in
net asset value to $15.27 on March 31, 2004 from $14.76 on September 30,
2003, and the reinvestment of all distributions.(3)
- Based on the most recent dividend and a share price of $15.91, the Fund had
a market yield of 6.03% at March 31, 2004.(4) The Fund's market yield is
equivalent to a taxable yield of 9.91%.(5)
[CHART]
RATING DISTRIBUTION(1),(2)
By total investments
BBB 2.0%
A 6.9%
AA 6.4%
AAA 84.7%
FUND INFORMATION
AS OF MARCH 31, 2004
PERFORMANCE(6)
Average Annual Total Returns (by share price, American Stock Exchange)
One year 19.19%
Life of Fund (11/29/02) 15.77
Average Annual Total Returns (by net asset value)
One year 11.23%
Life of Fund (11/29/02) 12.28
(1) FUND STATISTICS AND RATING DISTRIBUTION ARE SUBJECT TO CHANGE.
(2) RATING DISTRIBUTION IS DETERMINED BY DIVIDING THE TOTAL MARKET VALUE OF THE
ISSUES BY THE TOTAL INVESTMENTS OF THE FUND.
(3) A PORTION OF THE FUND'S INCOME MAY BE SUBJECT TO FEDERAL AND STATE INCOME
TAX.
(4) THE FUND'S MARKET YIELD IS CALCULATED BY DIVIDING THE MOST RECENT DIVIDEND
PER SHARE BY THE SHARE PRICE AT THE END OF THE PERIOD AND ANNUALIZING THE
RESULT.
(5) TAXABLE-EQUIVALENT YIELD ASSUMES MAXIMUM 39.14% FEDERAL AND STATE INCOME
TAX RATE. A LOWER RATE WOULD RESULT IN A LOWER TAX-EQUIVALENT FIGURE.
(6) RETURNS ARE HISTORICAL AND ARE CALCULATED BY DETERMINING THE PERCENTAGE
CHANGE IN SHARE PRICE OR NET ASSET VALUE WITH ALL DISTRIBUTIONS REINVESTED.
PERFORMANCE RESULTS REFLECT THE EFFECT OF LEVERAGE RESULTING FROM THE
FUND'S ISSUANCE OF AUCTION PREFERRED SHARES.
* PRIVATE INSURANCE DOES NOT REMOVE THE RISK OF LOSS OF PRINCIPAL ASSOCIATED
WITH INSURED INVESTMENTS DUE TO CHANGES IN MARKET CONDITIONS.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. INVESTMENT RETURN AND
SHARE PRICE WILL FLUCTUATE SO THAT SHARES, WHEN SOLD, MAY BE WORTH MORE OR
LESS THAN THEIR ORIGINAL COST. PERFORMANCE IS FOR THE STATED TIME PERIOD
ONLY; DUE TO MARKET VOLATILITY, THE FUND'S CURRENT PERFORMANCE MAY BE LOWER
OR HIGHER THAN QUOTED RETURN.
9
EATON VANCE INSURED NEW YORK MUNICIPAL BOND FUND II as of March 31, 2004
INVESTMENT UPDATE
[PHOTO OF THOMAS J. FETTER]
Thomas J. Fetter
Portfolio Manager
MANAGEMENT UPDATE
- The New York economy improved in 2003 and early 2004, although job creation
was sporadic. The pace of hiring in the key financial services and
manufacturing sectors remained central to the still-evolving recovery of
the New York economy. The state's March 2004 jobless rate was 6.5%, up
slightly from 6.3% a year ago.
- Insured* transportation bonds, which are among New York's largest issuers,
remained the Fund's largest sector weighting at March 31, 2004. The Fund's
investments included issues for rapid transit, port authorities, bridges
and tunnels and highway projects.
- Insured* private education bonds remained a significant focus of the Fund.
The Fund's investments focused on Dormitory Authority bonds that financed
facilities for some of the state's most renowned universities.
- Insured* lease revenue/certificates of participation bonds were large
holdings. Providing lease financing for various municipal projects, these
issues afford economies of scale and low fixed-rate interest costs, an
attractive feature for municipal borrowers.
- Management continued to adjust the Fund's coupon structure. Selected Puerto
Rico bonds gave the Fund additional flexibility in this respect, as well as
further diversification through insured* general obligations, lease revenue
and transportation bonds.
FUND STATISTICS(1)
- Number of Issues: 38
- Effective Maturity: 9.4 years
- Average Rating: AA+
- Average Call: 9.1 years
- Average Dollar Price: $98.85
THE FUND
PERFORMANCE FOR THE PAST SIX MONTHS
- Based on share price (traded on the American Stock Exchange), the Fund had
a total return of 16.75% for the six months ended March 31, 2004. That
return was the result of an increase in share price to $15.27 on March 31,
2004 from $13.71 on September 30, 2003, and the reinvestment of $0.482 in
regular monthly dividends and $0.221 in capital gain distributions.(3)
- Based on net asset value, the Fund had a total return of 6.30% for the six
months ended March 31, 2004. That return was the result of an increase in
net asset value to $15.08 on March 31, 2004 from $14.87 on September 30,
2003, and the reinvestment of all distributions.(3)
- Based on the most recent dividend and a share price of $15.27, the Fund had
a market yield of 6.31% at March 31, 2004.(4) The Fund's market yield is
equivalent to a taxable yield of 10.52%.(5)
[CHART]
RATING DISTRIBUTION(1),(2)
By total investments
Non-Rated 1.8%
BBB 3.0%
A 4.7%
AA 7.0%
AAA 83.5%
FUND INFORMATION as of March 31, 2004
PERFORMANCE(6)
Average Annual Total Returns (by share price, American Stock Exchange)
One year 14.13%
Life of Fund (11/29/02) 12.57
Average Annual Total Returns (by net asset value)
One year 11.25%
Life of Fund (11/29/02) 11.52
(1) FUND STATISTICS AND RATING DISTRIBUTION ARE SUBJECT TO CHANGE.
(2) RATING DISTRIBUTION IS DETERMINED BY DIVIDING THE TOTAL MARKET VALUE OF THE
ISSUES BY THE TOTAL INVESTMENTS OF THE FUND.
(3) A PORTION OF THE FUND'S INCOME MAY BE SUBJECT TO FEDERAL AND STATE INCOME
TAX.
(4) THE FUND'S MARKET YIELD IS CALCULATED BY DIVIDING THE MOST RECENT DIVIDEND
PER SHARE BY THE SHARE PRICE AT THE END OF THE PERIOD AND ANNUALIZING THE
RESULT.
(5) TAXABLE-EQUIVALENT YIELD ASSUMES MAXIMUM 40.01% FEDERAL AND STATE INCOME
TAX RATE. A LOWER RATE WOULD RESULT IN A LOWER TAX-EQUIVALENT FIGURE.
(6) RETURNS ARE HISTORICAL AND ARE CALCULATED BY DETERMINING THE PERCENTAGE
CHANGE IN SHARE PRICE OR NET ASSET VALUE WITH ALL DISTRIBUTIONS REINVESTED.
PERFORMANCE RESULTS REFLECT THE EFFECT OF LEVERAGE RESULTING FROM THE
FUND'S ISSUANCE OF AUCTION PREFERRED SHARES.
* PRIVATE INSURANCE DOES NOT REMOVE THE RISK OF LOSS OF PRINCIPAL ASSOCIATED
WITH INSURED INVESTMENTS DUE TO CHANGES IN MARKET CONDITIONS.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. INVESTMENT RETURN AND
SHARE PRICE WILL FLUCTUATE SO THAT SHARES, WHEN SOLD, MAY BE WORTH MORE OR
LESS THAN THEIR ORIGINAL COST. PERFORMANCE IS FOR THE STATED TIME PERIOD
ONLY; DUE TO MARKET VOLATILITY, THE FUND'S CURRENT PERFORMANCE MAY BE LOWER
OR HIGHER THAN QUOTED RETURN.
10
EATON VANCE INSURED OHIO MUNICIPAL BOND FUND as of March 31, 2004
INVESTMENT UPDATE
[PHOTO OF THOMAS J. FETTER]
Thomas J. Fetter
Portfolio Manager
MANAGEMENT UPDATE
- Ohio's economy continued to shed jobs in the manufacturing sector, which
accounts for 16% of the state's workforce, with especially severe losses in
the steel and auto areas. Meanwhile, education, health care and financial
services continued to generate some job momentum. The state's March 2004
jobless rate was 5.7%, down from 6.3% a year ago.
- Insured* general obligation bonds (GOs) were the Fund's largest sector
weighting at March 31, 2004. Insured* school district GOs have been valued
by investors in an uncertain economy that has continued to pressure
industrial and economically sensitive issuers.
- Insured* public education bonds constituted another major investment. The
Fund's investments included some of the prominent institutions within the
state university system, including those offering advanced degree,
technical and vocational programs.
- Insured* transportation bonds remained a significant investment for the
Fund. The Fund's largest holding was an issue for Cleveland Airport, which
has undertaken a $1.4 billion expansion program that will address the
demands of traffic growth and contribute to the midwest region's economy.
- Puerto Rico bonds played a role in management's efforts to maintain a broad
diversification. The Fund's insured* Puerto Rico holdings included lease
revenue, special tax revenue and transportation bonds.
FUND STATISTICS(1)
- Number of Issues: 37
- Effective Maturity: 10.2 years
- Average Rating: AA+
- Average Call: 10.0 years
- Average Dollar Price: $96.08
THE FUND
PERFORMANCE FOR THE PAST SIX MONTHS
- Based on share price (traded on the American Stock Exchange), the Fund had
a total return of 12.88% for the six months ended March 31, 2004. That
return was the result of an increase in share price to $15.76 on March 31,
2004 from $14.43 on September 30, 2003, and the reinvestment of $0.465 in
regular monthly dividends and $0.033 in capital gain distributions.(3)
- Based on net asset value, the Fund had a total return of 3.57% for the six
months ended March 31, 2004. That return was the result of an increase in
net asset value to $14.65 on March 31, 2004 from $14.62 on September 30,
2003, and the reinvestment of all distributions.(3)
- Based on the most recent dividend and a share price of $15.76, the Fund had
a market yield of 5.90% at March 31, 2004.(4) The Fund's market yield is
equivalent to a taxable yield of 9.81%.(5)
[CHART]
RATING DISTRIBUTION(1),(2)
By total investments
Non-Rated 3.3%
A 3.5%
AA 11.5%
AAA 81.7%
FUND INFORMATION
AS OF MARCH 31, 2004
PERFORMANCE(6)
Average Annual Total Returns (by share price, American Stock Exchange)
One year 11.09%
Life of Fund (11/29/02) 13.89
Average Annual Total Returns (by net asset value)
One year 7.09%
Life of Fund (11/29/02) 7.85
(1) FUND STATISTICS AND RATING DISTRIBUTION ARE SUBJECT TO CHANGE.
(2) RATING DISTRIBUTION IS DETERMINED BY DIVIDING THE TOTAL MARKET VALUE OF THE
ISSUES BY THE TOTAL INVESTMENTS OF THE FUND.
(3) A PORTION OF THE FUND'S INCOME MAY BE SUBJECT TO FEDERAL AND STATE INCOME
TAX.
(4) THE FUND'S MARKET YIELD IS CALCULATED BY DIVIDING THE MOST RECENT DIVIDEND
PER SHARE BY THE SHARE PRICE AT THE END OF THE PERIOD AND ANNUALIZING THE
RESULT.
(5) TAXABLE-EQUIVALENT YIELD ASSUMES MAXIMUM 39.88% FEDERAL AND STATE INCOME
TAX RATE. A LOWER RATE WOULD RESULT IN A LOWER TAX-EQUIVALENT FIGURE.
(6) RETURNS ARE HISTORICAL AND ARE CALCULATED BY DETERMINING THE PERCENTAGE
CHANGE IN SHARE PRICE OR NET ASSET VALUE WITH ALL DISTRIBUTIONS REINVESTED.
PERFORMANCE RESULTS REFLECT THE EFFECT OF LEVERAGE RESULTING FROM THE
FUND'S ISSUANCE OF AUCTION PREFERRED SHARES.
* PRIVATE INSURANCE DOES NOT REMOVE THE RISK OF LOSS OF PRINCIPAL ASSOCIATED
WITH INSURED INVESTMENTS DUE TO CHANGES IN MARKET CONDITIONS.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. INVESTMENT RETURN AND
SHARE PRICE WILL FLUCTUATE SO THAT SHARES, WHEN SOLD, MAY BE WORTH MORE OR
LESS THAN THEIR ORIGINAL COST. PERFORMANCE IS FOR THE STATED TIME PERIOD
ONLY; DUE TO MARKET VOLATILITY, THE FUND'S CURRENT PERFORMANCE MAY BE LOWER
OR HIGHER THAN QUOTED RETURN.
11
EATON VANCE INSURED PENNSYLVANIA MUNICIPAL BOND FUND as of March 31, 2004
INVESTMENT UPDATE
[PHOTO OF CYNTHIA J. CLEMSON]
Cynthia J. Clemson
Portfolio Manager
MANAGEMENT UPDATE
- Pennsylvania's recovery from recession has been hindered by continued
weakness in its manufacturing sector, especially in the western part of the
state, which offset service sector gains elsewhere. Sectors showing
strength included education, health care, information and government. The
state's March 2004 jobless rate was 5.3%, down from 5.8% a year ago.
- Insured* general obligation bonds (GOs) were the Fund's largest sector
weighting at March 31, 2004. With the weak recovery, many Pennsylvania
communities, cities and towns have faced revenue shortfalls. Insured* GOs
represented high quality and a partial refuge from those revenue pressures.
- Insured* transportation bonds played a major role in the fund. Investments
included turnpike authority bonds, some of which were used to finance
maintenance and construction of highways.
- Insured* private education bonds were significant investments for the Fund.
The Fund found investment opportunities in issues for schools at the
university, college preparatory and vocational levels.
- In an uncertain economy, essential services bonds stand out for their
stable revenues. The Fund had investments in a variety of insured* water
and sewer bonds, including issues for Erie and major urban centers
Pittsburgh and Philadelphia.
FUND STATISTICS(1)
- Number of Issues: 49
- Effective Maturity: 8.5 years
- Average Rating: AAA
- Average Call: 8.1 years
- Average Dollar Price: $100.58
THE FUND
PERFORMANCE FOR THE PAST SIX MONTHS
- Based on share price (traded on the American Stock Exchange), the Fund had
a total return of 16.69% for the six months ended March 31, 2004. That
return was the result of an increase in share price to $16.06 on March 31,
2004 from $14.33 on September 30, 2003, and the reinvestment of $0.469 in
regular monthly dividends and $0.140 in capital gain distributions.(3)
- Based on net asset value, the Fund had a total return of 6.55% for the six
months ended March 31, 2004. That return was the result of an increase in
net asset value to $14.92 on March 31, 2004 from $14.58 on September 30,
2003, and the reinvestment of all distributions.(3)
- Based on the most recent dividend and a share price of $16.06, the Fund had
a market yield of 5.84% at March 31, 2004.(4) The Fund's market yield is
equivalent to a taxable yield of 9.27%.(5)
[CHART]
RATING DISTRIBUTION(1),(2)
By total investments
BBB 0.5%
A 7.2%
AAA 92.3%
FUND INFORMATION
AS OF MARCH 31, 2004
PERFORMANCE(6)
Average Annual Total Returns (by share price, American Stock Exchange)
One year 13.26%
Life of Fund (11/29/02) 16.21
Average Annual Total Returns (by net asset value)
One year 9.91%
Life of Fund (11/29/02) 10.00
(1) FUND STATISTICS AND RATING DISTRIBUTION ARE SUBJECT TO CHANGE.
(2) RATING DISTRIBUTION IS DETERMINED BY DIVIDING THE TOTAL MARKET VALUE OF THE
ISSUES BY THE TOTAL INVESTMENTS OF THE FUND.
(3) A PORTION OF THE FUND'S INCOME MAY BE SUBJECT TO FEDERAL AND STATE INCOME
TAX.
(4) THE FUND'S MARKET YIELD IS CALCULATED BY DIVIDING THE MOST RECENT DIVIDEND
PER SHARE BY THE SHARE PRICE AT THE END OF THE PERIOD AND ANNUALIZING THE
RESULT.
(5) TAXABLE-EQUIVALENT YIELD ASSUMES MAXIMUM 37.00% FEDERAL AND STATE INCOME
TAX RATE. A LOWER RATE WOULD RESULT IN A LOWER TAX-EQUIVALENT FIGURE.
(6) RETURNS ARE HISTORICAL AND ARE CALCULATED BY DETERMINING THE PERCENTAGE
CHANGE IN SHARE PRICE OR NET ASSET VALUE WITH ALL DISTRIBUTIONS REINVESTED.
PERFORMANCE RESULTS REFLECT THE EFFECT OF LEVERAGE RESULTING FROM THE
FUND'S ISSUANCE OF AUCTION PREFERRED SHARES.
* PRIVATE INSURANCE DOES NOT REMOVE THE RISK OF LOSS OF PRINCIPAL ASSOCIATED
WITH INSURED INVESTMENTS DUE TO CHANGES IN MARKET CONDITIONS.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. INVESTMENT RETURN AND
SHARE PRICE WILL FLUCTUATE SO THAT SHARES, WHEN SOLD, MAY BE WORTH MORE OR
LESS THAN THEIR ORIGINAL COST. PERFORMANCE IS FOR THE STATED TIME PERIOD
ONLY; DUE TO MARKET VOLATILITY, THE FUND'S CURRENT PERFORMANCE MAY BE LOWER
OR HIGHER THAN QUOTED RETURN.
12
INSURED MUNICIPAL BOND FUND II as of March 31, 2004
PORTFOLIO OF INVESTMENTS (Unaudited)
TAX-EXEMPT INVESTMENTS -- 158.7%
PRINCIPAL AMOUNT
(000'S OMITTED) SECURITY VALUE
-----------------------------------------------------------------------------------------------
GENERAL OBLIGATIONS -- 9.7%
$ 5,750 California, 5.25%, 4/1/30 $ 5,876,155
2,215 California, 5.50%, 11/1/33 2,321,608
5,000 New York City, NY, 5.25%, 1/15/33 5,245,350
1,500 North Carolina, Variable Rate, 3/1/28(1)(2) 800,100
-----------------------------------------------------------------------------------------------
$ 14,243,213
-----------------------------------------------------------------------------------------------
HOSPITAL -- 6.2%
$ 750 Cuyahoga County, OH, (Cleveland Clinic Health
System), 5.50%, 1/1/29 $ 785,078
1,000 Hawaii Pacific Health, 5.60%, 7/1/33 1,017,600
1,000 Highlands County, FL, Health Facilities Authority,
(Adventist Health System), 5.375%, 11/15/35 1,031,390
1,500 Lehigh County, PA, General Purpose Authority,
(Lehigh Valley Health Network), 5.25%, 7/1/32 1,543,560
4,500 South Miami, FL, Health Facility Authority,
(Baptist Health), 5.25%, 11/15/33 4,616,370
-----------------------------------------------------------------------------------------------
$ 8,993,998
-----------------------------------------------------------------------------------------------
INSURED-ELECTRIC UTILITIES -- 8.3%
$ 22,685 Chelan County, WA, Public Utility District No. 1,
(Columbia River), (MBIA), 0.00%, 6/1/23 $ 8,480,560
2,000 Forsyth, MT, PCR, (Puget Sound Energy), (AMBAC),
5.00%, 3/1/31 2,091,440
1,500 Municipal Energy Agency, NE, (Power Supply System),
(FSA), 5.00%, 4/1/36 1,558,725
-----------------------------------------------------------------------------------------------
$ 12,130,725
-----------------------------------------------------------------------------------------------
INSURED-GENERAL OBLIGATIONS -- 23.8%
$ 1,600 Alvin, TX, Independent School District, (MBIA),
3.25%, 2/15/27 $ 1,275,376
1,640 California, (XLCA), Variable Rate, 10/1/28(2)(3) 1,806,886
10,000 Chicago, IL, Board of Education, (FGIC),
0.00%, 12/1/23 3,740,600
5,700 Chicago, IL, Board of Education, (FSA),
5.00%, 12/1/31 5,877,156
8,330 King County, WA, (MBIA), 5.25%, 1/1/34 8,695,687
5,000 Massachusetts, (AMBAC), 5.50%, 8/1/30 5,779,300
2,080 Philadelphia, PA, (FSA), Variable Rate, 9/15/31(2)(3) 2,285,150
2,000 Phoenix, AZ, (AMBAC), 3.00%, 7/1/28 1,527,380
10,000 Washington, (Motor Vehicle Fuel), (MBIA),
0.00%, 12/1/23 3,719,200
-----------------------------------------------------------------------------------------------
$ 34,706,735
-----------------------------------------------------------------------------------------------
INSURED-HOSPITAL -- 2.7%
$ 3,000 Maryland HEFA, (Medlantic/Helix Issue), (FSA),
Variable Rate, 8/15/38(2)(3) $ 3,929,880
-----------------------------------------------------------------------------------------------
$ 3,929,880
-----------------------------------------------------------------------------------------------
INSURED-LEASE REVENUE / CERTIFICATES OF PARTICIPATION -- 3.0%
$ 4,250 Massachusetts Development Finance Agency,
(MBIA), 5.125%, 2/1/34 $ 4,422,040
-----------------------------------------------------------------------------------------------
$ 4,422,040
-----------------------------------------------------------------------------------------------
INSURED-PRIVATE EDUCATION -- 3.8%
$ 2,500 Massachusetts Development Finance Agency,
(Boston University), (XLCA), 6.00%, 5/15/59 $ 2,950,200
2,500 Massachusetts Development Finance Agency,
(Franklin W. Olin College), (XLCA), 5.25%, 7/1/33 2,618,250
-----------------------------------------------------------------------------------------------
$ 5,568,450
-----------------------------------------------------------------------------------------------
INSURED-PUBLIC EDUCATION -- 3.8%
$ 5,335 University of California, (AMBAC), 5.00%, 9/1/27 $ 5,525,833
-----------------------------------------------------------------------------------------------
$ 5,525,833
-----------------------------------------------------------------------------------------------
INSURED-SEWER REVENUE -- 1.8%
$ 2,575 Tacoma, WA, Sewer Revenue, (FGIC), 5.00%,
12/1/31 $ 2,656,705
-----------------------------------------------------------------------------------------------
$ 2,656,705
-----------------------------------------------------------------------------------------------
INSURED-SPECIAL TAX REVENUE -- 10.8%
$ 11,000 Metropolitan Pier and Exposition Authority,
(McCormick Place Expansion), IL, (MBIA),
0.00%, 12/15/25 $ 3,668,280
4,000 Metropolitan Pier and Exposition Authority,
(McCormick Place Expansion), IL, (MBIA),
5.25%, 6/15/42 4,219,160
2,165 San Jose, CA, Redevelopment Agency Tax,
(MBIA), Variable Rate, 8/1/32(2)(3) 2,369,246
5,325 Utah Transportation Authority Sales Tax, (FSA),
5.00%, 6/15/32 5,522,451
-----------------------------------------------------------------------------------------------
$ 15,779,137
-----------------------------------------------------------------------------------------------
INSURED-TRANSPORTATION -- 35.0%
$ 4,000 Chicago, IL, Transportation, (Skywalk),
(AMBAC), 5.25%, 1/1/31 $ 4,206,200
1,250 Dallas, TX, Area Rapid Transportation Sales Tax,
(AMBAC), 5.00%, 12/1/31 1,289,663
See notes to financial statements
13
PRINCIPAL AMOUNT
(000'S OMITTED) SECURITY VALUE
-----------------------------------------------------------------------------------------------
INSURED-TRANSPORTATION (CONTINUED)
$ 11,900 E-470 Public Highway Authority, CO, (MBIA),
0.00%, 9/1/22 $ 4,766,664
12,390 E-470 Public Highway Authority, CO, (MBIA),
0.00%, 9/1/24 4,380,485
3,835 Massachusetts Turnpike Authority, Metropolitan
Highway System, (MBIA), Variable Rate, 1/1/37(2)(3) 4,013,826
13,885 Nevada Department of Business and Industry,
(Las Vegas Monorail-1st Tier), (AMBAC),
0.00%, 1/1/20 6,457,775
5,000 South Carolina Transportation Infrastructure, (AMBAC),
5.25%, 10/1/31 5,270,650
10,000 Texas Turnpike Authority, (AMBAC), 5.00%, 8/15/42 10,264,300
10,000 Triborough Bridge and Tunnel Authority, NY, (MBIA),
5.00%, 11/15/32 10,408,000
-----------------------------------------------------------------------------------------------
$ 51,057,563
-----------------------------------------------------------------------------------------------
INSURED-UTILITIES -- 9.9%
$ 6,500 Los Angeles, CA, Department of Water and Power,
(FGIC), 5.00%, 7/1/43 $ 6,672,770
1,500 Los Angeles, CA, Department of Water and Power,
(MBIA), 5.125%, 7/1/41 1,551,150
6,000 Philadelphia, PA, Gas Works Revenue, (FSA),
5.00%, 8/1/32 6,249,000
-----------------------------------------------------------------------------------------------
$ 14,472,920
-----------------------------------------------------------------------------------------------
INSURED-WATER AND SEWER -- 22.0%
$ 3,240 Atlanta, GA, Water and Sewer, (FGIC),
5.00%, 11/1/38(4) $ 3,338,204
4,895 Atlanta, GA, Water and Wastewater, (MBIA),
5.00%, 11/1/39 5,056,780
10,705 Birmingham, AL, Waterworks and Sewer Board,
(MBIA), 5.00%, 1/1/37 11,068,328
10,750 Houston, TX, Water & Sewer System, (FSA),
5.00%, 12/1/30 11,135,495
1,275 Pittsburgh, PA, Water and Sewer Authority,
(AMBAC), Variable Rate, 12/1/27(2)(3) 1,467,053
-----------------------------------------------------------------------------------------------
$ 32,065,860
-----------------------------------------------------------------------------------------------
INSURED-WATER REVENUE -- 10.2%
$ 2,330 Contra Costa, CA, Water District, (FSA), Variable Rate,
10/1/32(2)(3) $ 2,608,668
3,450 Detroit, MI, Water Supply System, (MBIA),
Variable Rate, 7/1/34(2)(3) 3,867,588
3,500 Metropolitan Water District, CA, (FGIC),
5.00%, 10/1/36 3,649,205
4,610 Texas Southmost Regional Water Authority, (MBIA),
5.00%, 9/1/32 4,765,910
-----------------------------------------------------------------------------------------------
$ 14,891,371
-----------------------------------------------------------------------------------------------
OTHER REVENUE -- 1.6%
$ 1,500 Capital Trust Agency, FL, (Seminole Tribe Convention),
8.95%, 10/1/33 $ 1,764,270
430 Capital Trust Agency, FL, (Seminole Tribe Convention),
10.00%, 10/1/33 534,352
-----------------------------------------------------------------------------------------------
$ 2,298,622
-----------------------------------------------------------------------------------------------
TRANSPORTATION -- 6.1%
$ 8,500 Metropolitan Transportation Authority of New York,
5.125%, 1/1/29 $ 8,853,260
-----------------------------------------------------------------------------------------------
$ 8,853,260
-----------------------------------------------------------------------------------------------
TOTAL TAX-EXEMPT INVESTMENTS -- 158.7%
(IDENTIFIED COST $221,850,294) $ 231,596,312
-----------------------------------------------------------------------------------------------
OTHER ASSETS, LESS LIABILITIES -- 1.3% $ 1,847,410
-----------------------------------------------------------------------------------------------
AUCTION PREFERRED SHARES PLUS CUMULATIVE UNPAID DIVIDENDS -- (60.0)% $ (87,539,392)
-----------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO COMMON SHARES -- 100.0% $ 145,904,330
-----------------------------------------------------------------------------------------------
AMBAC - AMBAC Financial Group, Inc.
FGIC - Financial Guaranty Insurance Company
FSA - Financial Security Assurance, Inc.
MBIA - Municipal Bond Insurance Association
XLCA - XL Capital Assurance, Inc.
The Fund invests primarily in debt securities issued by municipalities. The
ability of the issuers of the debt securities to meet their obligations may be
affected by economic developments in a specific industry or municipality. In
order to reduce the risk associated with such economic developments, at March
31, 2004, 85.2% of the securities in the portfolio of investments are backed by
bond insurance of various financial institutions and financial guaranty
assurance agencies. The aggregate percentage insured by an individual financial
institution ranged from 3.2% to 37.4% of total investments.
(1) Security has been issued as an inverse floater bond.
(2) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
(3) Security has been issued as a leveraged inverse floater bond.
(4) Security (or a portion thereof) has been segregated to cover margin
requirements on open financial futures contracts.
See notes to financial statements
14
INSURED CALIFORNIA MUNICIPAL BOND FUND II as of March 31, 2004
PORTFOLIO OF INVESTMENTS (Unaudited)
TAX-EXEMPT INVESTMENTS -- 155.7%
PRINCIPAL
AMOUNT
(000'S OMITTED) SECURITY VALUE
-----------------------------------------------------------------------------------------------
GENERAL OBLIGATIONS -- 5.6%
$ 750 California, 5.00%, 2/1/21 $ 767,430
900 California, 5.25%, 4/1/30 919,746
1,465 California, 5.50%, 11/1/33 1,535,510
-----------------------------------------------------------------------------------------------
$ 3,222,686
-----------------------------------------------------------------------------------------------
INSURED-ELECTRIC UTILITIES -- 10.4%
$ 3,475 Glendale Electric, (MBIA), 5.00%, 2/1/32 $ 3,603,888
1,650 Puerto Rico Electric Power Authority, (FSA),
Variable Rate, 7/1/29(1)(2) 1,884,630
455 Sacramento Municipal Electric Utility District,
(FSA), Variable Rate, 8/15/28(2)(3) 503,553
-----------------------------------------------------------------------------------------------
$ 5,992,071
-----------------------------------------------------------------------------------------------
INSURED-ESCROWED/PREREFUNDED -- 5.1%
$ 800 Metropolitan Water District, (Southern California
Waterworks), (MBIA), Prerefunded to 1/1/07,
Variable Rate, 7/1/27(2)(3) $ 1,016,576
1,750 Metropolitan Water District, (Southern California
Waterworks), (MBIA), Prerefunded to 1/1/08,
5.00%, 7/1/30 1,962,047
-----------------------------------------------------------------------------------------------
$ 2,978,623
-----------------------------------------------------------------------------------------------
INSURED-GENERAL OBLIGATIONS -- 31.3%
$ 1,250 California, (AMBAC), 5.00%, 4/1/27 $ 1,291,175
415 California, (XLCA), Variable Rate, 10/1/28(2)(3) 457,230
5,000 Clovis Unified School District, (FGIC), 0.00%, 8/1/20 2,276,700
2,000 Laguna Salada Union School District, (FGIC),
0.00%, 8/1/22 805,160
2,350 Long Beach Unified School District, (Election of 1999),
(FSA), 5.00%, 8/1/31 2,433,707
1,710 Los Angeles Unified School District, (FGIC),
5.375%, 7/1/25 1,839,567
1,945 Los Osos Community Services, Wastewater Assessment
District, (MBIA), 5.00%, 9/2/33 2,025,153
1,000 Mount Diablo Unified School District, (FSA),
5.00%, 8/1/25 1,045,330
4,300 San Mateo County Community College District,
(Election of 2001), (FGIC), 0.00%, 9/1/21 1,836,444
1,750 Santa Ana Unified School District, (MBIA),
5.00%, 8/1/32 1,818,652
3,200 Union Elementary School District, (FGIC),
0.00%, 9/1/22 1,284,320
$ 2,600 Union Elementary School District, (FGIC),
0.00%, 9/1/23 $ 980,148
-----------------------------------------------------------------------------------------------
$ 18,093,586
-----------------------------------------------------------------------------------------------
INSURED-LEASE REVENUE / CERTIFICATES OF PARTICIPATION -- 20.7%
$ 4,000 Anaheim, Public Financing Authority Lease Revenue,
(FSA), 5.00%, 3/1/37 $ 4,092,920
4,250 California Public Works Board Lease Revenue, (Department
of General Services), (AMBAC), 5.00%, 12/1/27(4) 4,408,568
2,250 Orange County Water District Certificates of Participation,
(MBIA), 5.00%, 8/15/34 2,334,960
1,075 San Jose Financing Authority, (Civic Center), (AMBAC),
5.00%, 6/1/32 1,112,152
-----------------------------------------------------------------------------------------------
$ 11,948,600
-----------------------------------------------------------------------------------------------
INSURED-PUBLIC EDUCATION -- 14.0%
$ 4,000 California University, (AMBAC), 5.00%, 11/1/33 $ 4,153,920
3,790 University of California, (FGIC), 5.125%, 9/1/31 3,965,288
-----------------------------------------------------------------------------------------------
$ 8,119,208
-----------------------------------------------------------------------------------------------
INSURED-SEWER REVENUE -- 16.3%
$ 5,700 East Bay Municipal Utility District Water System, (MBIA),
5.00%, 6/1/38 $ 5,856,294
3,425 Los Angeles Wastewater Treatment System, (FGIC),
5.00%, 6/1/28 3,558,541
-----------------------------------------------------------------------------------------------
$ 9,414,835
-----------------------------------------------------------------------------------------------
INSURED-SPECIAL ASSESSMENT REVENUE -- 15.7%
$ 2,500 Cathedral City Public Financing Authority, (Housing
Redevelopment), (MBIA), 5.00%, 8/1/33 $ 2,603,300
2,500 Cathedral City Public Financing Authority, (Tax Allocation
Redevelopment), (MBIA), 5.00%, 8/1/33 2,603,300
1,750 Irvine Public Facility and Infrastructure Authority
Assessment, (AMBAC), 5.00%, 9/2/26 1,805,335
2,000 Murrieta Redevelopment Agency Tax, (MBIA),
5.00%, 8/1/32 2,083,300
-----------------------------------------------------------------------------------------------
$ 9,095,235
-----------------------------------------------------------------------------------------------
INSURED-SPECIAL TAX REVENUE -- 9.3%
$ 3,750 San Francisco Bay Area Rapid Transportation District,
(AMBAC), 5.125%, 7/1/36 $ 3,892,200
1,335 San Jose Redevelopment Agency Tax, (MBIA),
Variable Rate, 8/1/32(2)(3) 1,460,944
-----------------------------------------------------------------------------------------------
$ 5,353,144
-----------------------------------------------------------------------------------------------
See notes to financial statements
15
PRINCIPAL AMOUNT
(000'S OMITTED) SECURITY VALUE
-----------------------------------------------------------------------------------------------
INSURED-TRANSPORTATION -- 15.7%
$ 4,000 California Infrastructure and Economic Development,
(Bay Area Toll Bridges), (AMBAC), 5.00%, 7/1/36 $ 4,166,600
2,250 Los Angeles County Metropolitan Transportation
Authority, (FGIC), 5.25%, 7/1/30 2,378,610
500 San Francisco City and County Airports Commission
International, (FGIC), 5.00%, 5/1/29 513,290
6,670 San Joaquin Hills Transportation Corridor Agency,
(MBIA), 0.00%, 1/15/27 2,036,218
-----------------------------------------------------------------------------------------------
$ 9,094,718
-----------------------------------------------------------------------------------------------
INSURED-UTILITIES -- 5.6%
$ 1,400 Los Angeles Department of Water and Power, (FGIC),
5.00%, 7/1/38 $ 1,443,316
1,750 Los Angeles Department of Water and Power, (FGIC),
5.125%, 7/1/41 1,809,675
-----------------------------------------------------------------------------------------------
$ 3,252,991
-----------------------------------------------------------------------------------------------
INSURED-WATER REVENUE -- 1.6%
$ 835 Contra Costa Water District, (FSA),
Variable Rate, 10/1/32(2)(3) $ 934,866
-----------------------------------------------------------------------------------------------
$ 934,866
-----------------------------------------------------------------------------------------------
WATER REVENUE -- 4.4%
$ 2,500 California Water Resource, (Central Valley),
5.00%, 12/1/29 $ 2,562,400
-----------------------------------------------------------------------------------------------
$ 2,562,400
-----------------------------------------------------------------------------------------------
TOTAL TAX-EXEMPT INVESTMENTS -- 155.7%
(IDENTIFIED COST $86,337,097) $ 90,062,963
-----------------------------------------------------------------------------------------------
OTHER ASSETS, LESS LIABILITIES -- 2.6% $ 1,521,240
-----------------------------------------------------------------------------------------------
AUCTION PREFERRED SHARES PLUS CUMULATIVE UNPAID DIVIDENDS -- (58.3)% $ (33,750,000)
-----------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO COMMON SHARES -- 100.0% $ 57,834,203
-----------------------------------------------------------------------------------------------
AMBAC - AMBAC Financial Group, Inc.
FGIC - Financial Guaranty Insurance Company
FSA - Financial Security Assurance, Inc.
MBIA - Municipal Bond Insurance Association
XLCA - XL Capital Assurance, Inc.
The Fund invests primarily in debt securities issued by California
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at March 31, 2004, 93.6% of the securities in the portfolio of
investments are backed by bond insurance of various financial institutions and
financial guaranty assurance agencies. The aggregate percentage insured by an
individual financial institution ranged from 0.5% to 32.6% of total investments.
(1) Security has been issued as an inverse floater bond.
(2) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
(3) Security has been issued as a leveraged inverse floater bond.
(4) Security (or a portion thereof) has been segregated to cover margin
requirements on open financial futures contracts.
See notes to financial statements
16
INSURED FLORIDA MUNICIPAL BOND FUND as of March 31, 2004
PORTFOLIO OF INVESTMENTS (Unaudited)
TAX-EXEMPT INVESTMENTS -- 155.9%
PRINCIPAL
AMOUNT
(000'S OMITTED) SECURITY VALUE
-----------------------------------------------------------------------------------------------
ELECTRIC UTILITIES -- 5.4%
$ 2,000 Jacksonville Electric Authority, (Electric System),
5.25%, 10/1/31 $ 2,069,000
-----------------------------------------------------------------------------------------------
$ 2,069,000
-----------------------------------------------------------------------------------------------
HOSPITAL -- 5.5%
$ 1,050 Highlands County, Health Facility Authority, (Adventist
Health), 5.25%, 11/15/23 $ 1,081,857
1,000 South Miami Health Facility Authority, (Baptist Health),
5.25%, 11/15/33 1,025,860
-----------------------------------------------------------------------------------------------
$ 2,107,717
-----------------------------------------------------------------------------------------------
INSURED-ELECTRIC UTILITIES -- 1.5%
$ 500 Puerto Rico Electric Power Authority, (FSA), Variable
Rate, 7/1/29(1)(2) $ 571,100
-----------------------------------------------------------------------------------------------
$ 571,100
-----------------------------------------------------------------------------------------------
INSURED-ESCROWED / PREREFUNDED -- 2.9%
$ 1,025 Dade County, Professional Sports Franchise Facility,
(MBIA), Escrowed to Maturity, 5.25%, 10/1/30 $ 1,133,988
-----------------------------------------------------------------------------------------------
$ 1,133,988
-----------------------------------------------------------------------------------------------
INSURED-GENERAL OBLIGATIONS -- 16.8%
$ 1,345 Florida Board of Education Capital Outlay,
(Public Education), (MBIA), 5.00%, 6/1/32 $ 1,403,292
2,000 Florida Board of Education Capital Outlay,
(Public Education), (MBIA), 5.00%, 6/1/32 2,086,680
1,520 Florida Municipal Loan Council Revenue, (MBIA),
0.00%, 4/1/23 601,525
1,520 Florida Municipal Loan Council Revenue, (MBIA),
0.00%, 4/1/24 565,106
1,700 Puerto Rico, (FSA), 5.125%, 7/1/30 1,795,999
-----------------------------------------------------------------------------------------------
$ 6,452,602
-----------------------------------------------------------------------------------------------
INSURED-HOSPITAL -- 18.4%
$ 1,500 Jacksonville Economic Development Commission,
(Mayo Clinic), (MBIA), 5.50%, 11/15/36 $ 1,625,580
1,000 Jacksonville Economic Development Commission,
(Mayo Clinic), (MBIA), 5.50%, 11/15/36 1,083,720
1,500 Miami-Dade County, Health Facilities Authority, (Miami
Children's Hospital), (AMBAC), 5.125%, 8/15/26 1,568,445
$ 1,510 Sarasota County, Public Hospital Board, (Sarasota
Memorial Hospital), (MBIA), 5.25%, 7/1/24(3) $ 1,651,940
1,000 Sarasota County, Public Hospital Board, (Sarasota
Memorial Hospital), (MBIA), 5.50%, 7/1/28 1,137,790
-----------------------------------------------------------------------------------------------
$ 7,067,475
-----------------------------------------------------------------------------------------------
INSURED-LEASE REVENUE / CERTIFICATES OF PARTICIPATION -- 7.7%
$ 1,605 Port Palm Beach District, (Improvements), (XLCA),
0.00%, 9/1/24 $ 578,041
1,950 Port Palm Beach District, (Improvements), (XLCA),
0.00%, 9/1/25 662,473
1,700 Port Palm Beach District, (Improvements), (XLCA),
0.00%, 9/1/26 544,374
1,000 Puerto Rico Public Building Authority, (XLCA),
5.50%, 7/1/21 1,164,390
-----------------------------------------------------------------------------------------------
$ 2,949,278
-----------------------------------------------------------------------------------------------
INSURED-MISCELLANEOUS -- 22.7%
$ 1,500 Miami-Dade County, (Professional Sports Franchise),
(MBIA), 4.75%, 10/1/30 $ 1,513,770
1,740 Orange County Tourist Development, (AMBAC),
5.125%, 10/1/25 1,832,098
750 Orange County Tourist Development, (AMBAC),
Variable Rate, 10/1/30(2)(4) 859,778
1,500 Polk County, Transportation Improvements, (FSA),
5.375%, 12/1/25 1,610,580
2,750 Village Center Community Development District, (MBIA),
5.00%, 11/1/32 2,877,875
-----------------------------------------------------------------------------------------------
$ 8,694,101
-----------------------------------------------------------------------------------------------
INSURED-SEWER REVENUE -- 6.8%
$ 2,500 Pinellas County, Sewer, (FSA), 5.00%, 10/1/32 $ 2,610,900
-----------------------------------------------------------------------------------------------
$ 2,610,900
-----------------------------------------------------------------------------------------------
INSURED-SPECIAL ASSESSMENT REVENUE -- 7.5%
$ 2,780 Julington Creek, Plantation Community Development
District, (MBIA), 5.00%, 5/1/29 $ 2,892,062
-----------------------------------------------------------------------------------------------
$ 2,892,062
-----------------------------------------------------------------------------------------------
INSURED-SPECIAL TAX REVENUE -- 34.5%
$ 1,000 Bay County, Sales Tax, (AMBAC), 5.125%, 9/1/27 $ 1,052,510
1,250 Bay County, Sales Tax, (AMBAC), 5.125%, 9/1/32 1,312,413
1,000 Dade County, Special Obligation Residual Certificates,
(AMBAC), Variable Rate, 10/1/35(2)(4) 1,045,840
See notes to financial statements
17
PRINCIPAL AMOUNT
(000'S OMITTED) SECURITY VALUE
-----------------------------------------------------------------------------------------------
INSURED-SPECIAL TAX REVENUE (CONTINUED)
$ 1,500 Jacksonville Capital Improvements, (AMBAC),
5.00%, 10/1/30 $ 1,561,635
4,000 Jacksonville Transportation, (MBIA), 5.00%, 10/1/31 4,148,040
1,275 Jacksonville, Excise Tax, (FGIC), 5.125%, 10/1/27 1,342,550
225 Miami-Dade County, Special Obligation, (MBIA),
5.00%, 10/1/37 231,131
1,420 Orange County, Sales Tax, (FGIC), 5.125%, 1/1/23 1,512,584
440 Puerto Rico Infrastructure Financing Authority, (AMBAC),
Variable Rate, 7/1/28(4) 486,103
1,120 Sunrise Public Facility, (MBIA), 0.00%, 10/1/20 525,011
-----------------------------------------------------------------------------------------------
$ 13,217,817
-----------------------------------------------------------------------------------------------
INSURED-TRANSPORTATION -- 7.8%
$ 1,500 Florida Turnpike Authority, (Department of Transportation),
(FGIC), 4.50%, 7/1/27 $ 1,489,215
330 Puerto Rico Highway and Transportation Authority, (FSA),
Variable Rate, 7/1/32(2)(4) 380,097
940 Puerto Rico Highway and Transportation Authority, (MBIA),
Variable Rate, 7/1/36(2)(4) 1,126,562
-----------------------------------------------------------------------------------------------
$ 2,995,874
-----------------------------------------------------------------------------------------------
INSURED-WATER AND SEWER -- 12.6%
$ 2,000 Marco Island Utility System, (MBIA), 5.00%, 10/1/27 $ 2,093,620
1,500 Marion County Utility System, (MBIA), 5.00%, 12/1/33 1,567,155
1,000 Sunrise Utility System, (AMBAC), 5.50%, 10/1/18 1,158,440
-----------------------------------------------------------------------------------------------
$ 4,819,215
-----------------------------------------------------------------------------------------------
INSURED-WATER REVENUE -- 5.8%
$ 1,640 Tampa Bay Water Utility System, (FGIC),
5.00%, 10/1/31 $ 1,700,696
500 Tampa Bay Water Utility System, (FGIC),
Variable Rate, 10/1/27(1)(2) 510,470
-----------------------------------------------------------------------------------------------
$ 2,211,166
-----------------------------------------------------------------------------------------------
TOTAL TAX-EXEMPT INVESTMENTS -- 155.9%
(IDENTIFIED COST $57,237,651) $ 59,792,295
-----------------------------------------------------------------------------------------------
OTHER ASSETS, LESS LIABILITIES -- 2.8% $ 1,056,833
-----------------------------------------------------------------------------------------------
AUCTION PREFERRED SHARES PLUS CUMULATIVE UNPAID DIVIDENDS --(58.7)% $ (22,501,114)
NET ASSETS APPLICABLE TO COMMON SHARES -- 100.0% $ 38,348,014
AMBAC - AMBAC Financial Group, Inc.
FGIC - Financial Guaranty Insurance Company
FSA - Financial Security Assurance, Inc.
MBIA - Municipal Bond Insurance Association
XLCA - XL Capital Assurance, Inc.
The Fund invests primarily in debt securities issued by Florida municipalities.
The ability of the issuers of the debt securities to meet their obligations may
be affected by economic developments in a specific industry or municipality. In
order to reduce the risk associated with such economic developments, at March
31, 2004, 93.0% of the securities in the portfolio of investments are backed by
bond insurance of various financial institutions and financial guaranty
assurance agencies. The aggregate percentage insured by an individual financial
institution ranged from 4.9% to 47.3% of total investments.
(1) Security has been issued as an inverse floater bond.
(2) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
(3) Security (or a portion thereof) has been segregated to cover margin
requirements on open financial futures contracts.
(4) Security has been issued as a leveraged inverse floater bond.
See notes to financial statements
18
INSURED MASSACHUSETTS MUNICIPAL BOND FUND as of March 31, 2004
PORTFOLIO OF INVESTMENTS (Unaudited)
TAX-EXEMPT INVESTMENTS -- 157.5%
PRINCIPAL
AMOUNT
(000'S OMITTED) SECURITY VALUE
-----------------------------------------------------------------------------------------------
HOSPITAL -- 6.2%
$ 1,500 Massachusetts HEFA, (Partners Healthcare System),
5.75%, 7/1/32 $ 1,618,395
-----------------------------------------------------------------------------------------------
$ 1,618,395
-----------------------------------------------------------------------------------------------
INSURED-ELECTRIC UTILITIES -- 4.1%
$ 1,000 Puerto Rico Electric Power Authority, (FSA),
5.125%, 7/1/26 $ 1,072,450
-----------------------------------------------------------------------------------------------
$ 1,072,450
-----------------------------------------------------------------------------------------------
INSURED-ESCROWED / PREREFUNDED -- 3.8%
$ 3,000 Massachusetts College Building Authority, (MBIA),
Escrowed to Maturity, 0.00%, 5/1/26 $ 982,320
-----------------------------------------------------------------------------------------------
$ 982,320
-----------------------------------------------------------------------------------------------
INSURED-GENERAL OBLIGATIONS -- 15.7%
$ 1,220 Martha's Vineyard, (AMBAC), 5.00%, 5/1/32(1) $ 1,268,898
500 Massachusetts, (MBIA), 5.00%, 8/1/27 520,110
1,020 Maynard, (MBIA), 5.50%, 2/1/22 1,152,651
1,000 Puerto Rico, (FGIC), Variable Rate, 7/1/32(2)(3) 1,151,810
-----------------------------------------------------------------------------------------------
$ 4,093,469
-----------------------------------------------------------------------------------------------
INSURED-HOSPITAL -- 11.6%
$ 1,750 Massachusetts HEFA, (Harvard Pilgrim Health), (FSA),
5.00%, 7/1/28 $ 1,775,463
1,210 Massachusetts HEFA, (New England Medical Center ),
(FGIC), 5.00%, 5/15/25 1,250,305
-----------------------------------------------------------------------------------------------
$ 3,025,768
-----------------------------------------------------------------------------------------------
INSURED-LEASE REVENUE / CERTIFICATES OF PARTICIPATION -- 15.5%
$ 1,750 Massachusetts Development Finance Agency, (MBIA),
5.125%, 2/1/34 $ 1,820,840
1,000 Plymouth County Correctional Facility, (AMBAC),
5.00%, 4/1/22 1,038,250
1,000 Puerto Rico Public Building Authority, (CIFG),
Variable Rate, 7/1/36(2)(3) 1,173,130
-----------------------------------------------------------------------------------------------
$ 4,032,220
-----------------------------------------------------------------------------------------------
INSURED-MISCELLANEOUS -- 15.7%
$ 2,000 Boston Convention Center, (AMBAC), 5.00%, 5/1/27 $ 2,082,060
$ 1,000 Massachusetts Development Finance Agency, (WGBH
Educational Foundation), (AMBAC), 5.375%, 1/1/42 $ 1,066,090
800 Puerto Rico Municipal Finance Agency, (FSA), Variable
Rate, 8/1/27(2)(3) 930,072
-----------------------------------------------------------------------------------------------
$ 4,078,222
-----------------------------------------------------------------------------------------------
INSURED-PRIVATE EDUCATION -- 32.3%
$ 1,000 Massachusetts Development Finance Agency,
(Boston University), (XLCA), 6.00%, 5/15/59 $ 1,180,080
2,000 Massachusetts Development Finance Agency,
(Franklin W. Olin College), (XLCA), 5.25%, 7/1/33 2,094,600
2,500 Massachusetts HEFA, (Brandeis University),
(MBIA), 5.00%, 10/1/26 2,592,875
1,000 Massachusetts IFA, (College of the Holy Cross),
(MBIA), 5.00%, 9/1/23 1,032,060
1,500 Massachusetts IFA, (Tufts University), (MBIA),
4.75%, 2/15/28 1,508,145
-----------------------------------------------------------------------------------------------
$ 8,407,760
-----------------------------------------------------------------------------------------------
INSURED-PUBLIC EDUCATION -- 11.1%
$ 700 Massachusetts College Building Authority, (XLCA),
5.50%, 5/1/39 $ 807,121
1,000 Massachusetts HEFA, (University of Massachusetts),
(FGIC), 5.125%, 10/1/34 1,047,270
1,000 Massachusetts HEFA, (Worcester State College),
(AMBAC), 5.00%, 11/1/32 1,042,470
-----------------------------------------------------------------------------------------------
$ 2,896,861
-----------------------------------------------------------------------------------------------
INSURED-TRANSPORTATION -- 11.8%
$ 500 Massachusetts Turnpike Authority, (AMBAC),
5.00%, 1/1/39 $ 511,365
5,700 Massachusetts Turnpike Authority, (MBIA),
0.00%, 1/1/28 1,717,182
415 Massachusetts Turnpike Authority, Metropolitan
Highway System, (MBIA), Variable Rate, 1/1/37(2)(3) 434,351
335 Puerto Rico Highway and Transportation Authority,
(MBIA), Variable Rate, 7/1/36(2)(3) 401,487
-----------------------------------------------------------------------------------------------
$ 3,064,385
-----------------------------------------------------------------------------------------------
INSURED-WATER AND SEWER -- 9.9%
$ 2,500 Massachusetts Water Resource Authority, (FSA),
5.00%, 8/1/32 $ 2,591,025
-----------------------------------------------------------------------------------------------
$ 2,591,025
-----------------------------------------------------------------------------------------------
See notes to financial statements
19
PRINCIPAL AMOUNT
(000'S OMITTED) SECURITY VALUE
-----------------------------------------------------------------------------------------------
PRIVATE EDUCATION -- 13.2%
$ 500 Massachusetts Development Finance Agency,
(Massachusetts College of Pharmacy), 5.75%, 7/1/33 $ 508,980
750 Massachusetts Development Finance Agency,
(Middlesex School), 5.00%, 9/1/33 767,220
600 Massachusetts Development Finance Agency,
(Western New England College), 6.125%, 12/1/32 618,468
500 Massachusetts HEFA, (Boston College), 5.125%, 6/1/24 527,730
1,000 Massachusetts IFA, (Groton School), 5.00%, 3/1/28 1,026,830
-----------------------------------------------------------------------------------------------
$ 3,449,228
-----------------------------------------------------------------------------------------------
SPECIAL TAX REVENUE -- 6.6%
$ 1,650 Massachusetts Bay Transportation Authority,
Sales Tax, 5.00%, 7/1/32 $ 1,709,681
-----------------------------------------------------------------------------------------------
$ 1,709,681
-----------------------------------------------------------------------------------------------
TOTAL TAX-EXEMPT INVESTMENTS -- 157.5%
(IDENTIFIED COST $39,456,799) $ 41,021,784
-----------------------------------------------------------------------------------------------
OTHER ASSETS, LESS LIABILITIES -- 2.0% $ 529,953
-----------------------------------------------------------------------------------------------
AUCTION PREFERRED SHARES PLUS
CUMULATIVE UNPAID DIVIDENDS -- (59.5)% $ (15,501,860)
-----------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO
COMMON SHARES -- 100.0% $ 26,049,877
-----------------------------------------------------------------------------------------------
AMBAC - AMBAC Financial Group, Inc.
CIFG - CDC IXIS Financial Guaranty North America, Inc.
FGIC - Financial Guaranty Insurance Company
FSA - Financial Security Assurance, Inc.
MBIA - Municipal Bond Insurance Association
XLCA - XL Capital Assurance, Inc.
The Fund invests primarily in debt securities issued by Massachusetts
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at March 31, 2004, 83.5% of the securities in the portfolio of
investments are backed by bond insurance of various financial institutions and
financial guaranty assurance agencies. The aggregate percentage insured by an
individual financial institution ranged from 2.9% to 29.6% of total investments.
(1) Security (or a portion thereof) has been segregated to cover margin
requirements on open financial futures contracts.
(2) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
(3) Security has been issued as a leveraged inverse floater bond.
See notes to financial statements
20
INSURED MICHIGAN MUNICIPAL BOND FUND as of March 31, 2004
PORTFOLIO OF INVESTMENTS (Unaudited)
TAX-EXEMPT INVESTMENTS -- 157.2%
PRINCIPAL AMOUNT
(000'S OMITTED) SECURITY VALUE
-----------------------------------------------------------------------------------------------
ELECTRIC UTILITIES -- 5.8%
$ 1,250 Michigan Strategic Fund, (Detroit Edison
Pollution Control), 5.45%, 9/1/29 $ 1,306,725
-----------------------------------------------------------------------------------------------
$ 1,306,725
-----------------------------------------------------------------------------------------------
HOSPITAL -- 22.7%
$ 1,000 Michigan Hospital Finance Authority, (McLaren
Obligated Group), 4.50%, 10/15/21 $ 958,380
1,000 Michigan Hospital Finance Authority,
(Oakwood Hospital), 5.75%, 4/1/32 1,055,530
1,500 Michigan Hospital Finance Authority, (Sparrow
Obligation Group), 5.625%, 11/15/36 1,542,480
1,500 Michigan Hospital Finance Authority, (Trinity
Health), 5.375%, 12/1/30 1,567,500
-----------------------------------------------------------------------------------------------
$ 5,123,890
-----------------------------------------------------------------------------------------------
INSURED-ELECTRIC UTILITIES -- 2.3%
$ 500 Michigan Strategic Fund Resource Recovery,
(Detroit Edison Co.), (XLCA), 5.25%, 12/15/32 $ 522,185
-----------------------------------------------------------------------------------------------
$ 522,185
-----------------------------------------------------------------------------------------------
INSURED-ESCROWED / PREREFUNDED -- 4.8%
$ 1,000 Michigan Hospital Finance Authority,
(St. John Health System), (AMBAC),
Escrowed to Maturity, 5.00%, 5/15/28 $ 1,074,640
-----------------------------------------------------------------------------------------------
$ 1,074,640
-----------------------------------------------------------------------------------------------
INSURED-GENERAL OBLIGATIONS -- 40.6%
$ 1,000 Avondale School District, (FSA), 5.00%, 5/1/29 $ 1,042,589
1,550 Detroit School District, (School Bond Loan Fund),
(FSA), 5.125%, 5/1/31 1,623,222
1,960 Grand Rapids and Kent County Joint Building Authority,
(Devos Place), (MBIA), 0.00%, 12/1/27 588,333
4,000 Grand Rapids and Kent County Joint Building Authority,
(MBIA), 0.00%, 12/1/30 1,020,160
750 Greenville Public Schools, (MBIA), 5.00%, 5/1/25 778,260
1,000 Melvindle-Northern Allen Park School District,
(Building and Site), (FSA), 5.00%, 5/1/28 1,041,670
2,130 Okemos Public School District, (MBIA), 0.00%, 5/1/19 1,069,516
700 Portland Public Schools, (School Bond Loan Fund),
(MBIA), 5.00%, 5/1/29 725,662
1,095 Puerto Rico, (FGIC), Variable Rate, 7/1/32(1)(2) 1,261,232
-----------------------------------------------------------------------------------------------
$ 9,150,644
-----------------------------------------------------------------------------------------------
INSURED-HOSPITAL -- 9.6%
$ 500 Michigan Hospital Finance Authority, Mid-Michigan
Obligation Group, (AMBAC), 5.00%, 4/15/32 $ 512,930
1,590 Royal Oak Hospital Finance Authority Revenue, (William
Beaumont Hospital), (MBIA), 5.25%, 11/15/35 1,647,049
-----------------------------------------------------------------------------------------------
$ 2,159,979
-----------------------------------------------------------------------------------------------
INSURED-LEASE REVENUE / CERTIFICATES OF PARTICIPATION -- 12.9%
$ 1,750 Michigan House of Representatives, (AMBAC),
0.00%, 8/15/22 $ 719,092
2,615 Michigan House of Representatives, (AMBAC),
0.00%, 8/15/23 1,008,370
1,000 Puerto Rico Public Building Authority, (CIFG),
Variable Rate, 7/1/36(1)(2) 1,173,130
-----------------------------------------------------------------------------------------------
$ 2,900,592
-----------------------------------------------------------------------------------------------
INSURED-PUBLIC EDUCATION -- 10.5%
$ 1,500 Central Michigan University, (AMBAC), 5.05%,
10/1/32(3) $ 1,569,825
750 Lake Superior University, (AMBAC),
5.125%, 11/15/26 786,683
-----------------------------------------------------------------------------------------------
$ 2,356,508
-----------------------------------------------------------------------------------------------
INSURED-SEWER REVENUE -- 5.8%
$ 1,250 Detroit Sewer Disposal, (FGIC), 5.125%, 7/1/31 $ 1,303,838
-----------------------------------------------------------------------------------------------
$ 1,303,838
-----------------------------------------------------------------------------------------------
INSURED-SPECIAL TAX -- 4.6%
$ 1,000 Ypsilanti Community Utilities Authority, (San Sewer
System), (FGIC), 5.00%, 5/1/32 $ 1,037,100
-----------------------------------------------------------------------------------------------
$ 1,037,100
-----------------------------------------------------------------------------------------------
INSURED-SPECIAL TAX REVENUE -- 16.1%
$ 500 Detroit Downtown Development, (MBIA),
4.75%, 7/1/25 $ 503,310
1,500 Lansing Building Authority, (MBIA), 5.00%, 6/1/29 1,564,320
1,500 Wayne Charter County, (Airport Hotel-Detroit
Metropolitan Airport), (MBIA), 5.00%, 12/1/30 1,560,345
-----------------------------------------------------------------------------------------------
$ 3,627,975
-----------------------------------------------------------------------------------------------
INSURED-TRANSPORTATION -- 4.6%
$ 1,000 Michigan Trunk Line, (FSA), 5.00%, 11/1/25 $ 1,039,930
-----------------------------------------------------------------------------------------------
$ 1,039,930
-----------------------------------------------------------------------------------------------
See notes to financial statements
21
PRINCIPAL AMOUNT
(000'S OMITTED) SECURITY VALUE
-----------------------------------------------------------------------------------------------
INSURED-UTILITY -- 7.0%
$ 1,000 Lansing Board Water Supply, Steam and Eletctric
Utility, (FSA), 5.00%, 7/1/25 $ 1,047,060
510 Lansing Board Water Supply, Steam and Eletctric
Utility, (FSA), 5.00%, 7/1/26 533,608
-----------------------------------------------------------------------------------------------
$ 1,580,668
-----------------------------------------------------------------------------------------------
INSURED-WATER REVENUE -- 9.9%
$ 1,300 Detroit Water Supply System, (FGIC), 5.00%, 7/1/30 $ 1,345,032
800 Detroit Water Supply System, (MBIA),
Variable Rate, 7/1/34(1)(2) 896,832
-----------------------------------------------------------------------------------------------
$ 2,241,864
-----------------------------------------------------------------------------------------------
TOTAL TAX-EXEMPT INVESTMENTS -- 157.2%
(IDENTIFIED COST $33,818,087) $ 35,426,538
-----------------------------------------------------------------------------------------------
OTHER ASSETS, LESS LIABILITIES -- 2.7% $ 611,962
-----------------------------------------------------------------------------------------------
AUCTION PREFERRED SHARES PLUS CUMULATIVE
UNPAID DIVIDENDS -- (59.9)% $ (13,500,336)
-----------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO
COMMON SHARES -- 100.0% $ 22,538,164
-----------------------------------------------------------------------------------------------
AMBAC - AMBAC Financial Group, Inc.
CIFG - CDC IXIS Financial Guaranty North America, Inc.
FGIC - Financial Guaranty Insurance Company
FSA - Financial Security Assurance, Inc.
MBIA - Municipal Bond Insurance Association
XLCA - XL Capital Assurance, Inc.
The Fund invests primarily in debt securities issued by Michigan municipalities.
The ability of the issuers of the debt securities to meet their obligations may
be affected by economic developments in a specific industry or municipality. In
order to reduce the risk associated with such economic developments, at March
31, 2004, 81.8% of the securities in the portfolio of investments are backed by
bond insurance of various financial institutions and financial guaranty
assurance agencies. The aggregate percentage insured by an individual financial
institution ranged from 1.5% to 29.2% of total investments.
(1) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
(2) Security has been issued as a leveraged inverse floater bond.
(3) Security (or a portion thereof) has been segregated to cover margin
requirements on open financial futures contracts.
See notes to financial statements
22
INSURED NEW JERSEY MUNICIPAL BOND FUND as of March 31, 2004
PORTFOLIO OF INVESTMENTS (Unaudited)
TAX-EXEMPT INVESTMENTS -- 155.9%
PRINCIPAL AMOUNT
(000'S OMITTED) SECURITY VALUE
-----------------------------------------------------------------------------------------------
EDUCATION -- 3.3%
$ 1,250 New Jersey Educational Facilities Authority,
(Stevens Institute of Technology), 5.25%, 7/1/32 $ 1,298,625
-----------------------------------------------------------------------------------------------
$ 1,298,625
-----------------------------------------------------------------------------------------------
HOSPITAL -- 1.6%
$ 610 New Jersey Health Care Facilities Financing Authority,
(Capital Health System), 5.375%, 7/1/33 $ 616,594
-----------------------------------------------------------------------------------------------
$ 616,594
-----------------------------------------------------------------------------------------------
INSURED-GENERAL OBLIGATIONS -- 28.0%
$ 2,260 Bayonne, (FSA), 0.00%, 7/1/22 $ 948,409
2,415 Bayonne, (FSA), 0.00%, 7/1/23 955,543
1,500 Bordentown Regional School District
Board of Education, (FGIC), 5.00%, 1/15/30(1) 1,574,970
5,500 Irvington Township, (FSA), 0.00%, 7/15/26 1,843,435
1,500 Jersey City, (FSA), 5.25%, 9/1/23 1,627,980
1,550 Puerto Rico, (FGIC), Variable Rate, 7/1/32(2)(3) 1,785,305
1,130 Rutherford Board of Education, (FGIC), 4.75%, 1/15/27 1,154,521
1,000 Washington Township and Mercer County
Board of Education, (FGIC), 5.00%, 1/1/27 1,045,320
-----------------------------------------------------------------------------------------------
$ 10,935,483
-----------------------------------------------------------------------------------------------
INSURED-HOSPITAL -- 11.3%
$ 2,750 New Jersey Health Care Facilities, (Englewood
Hospital), (MBIA), 5.00%, 8/1/31 $ 2,857,112
1,500 New Jersey Health Care Facilities, (Jersey City
Medical Center), (FSA), 5.00%, 8/1/41 1,545,270
-----------------------------------------------------------------------------------------------
$ 4,402,382
-----------------------------------------------------------------------------------------------
INSURED-INDUSTRIAL DEVELOPMENT REVENUE -- 8.4%
$ 3,170 Lafayette Yard, Community Development Corporation,
(Hotel and Conference Center), (FGIC), 5.00%, 4/1/35 $ 3,267,351
-----------------------------------------------------------------------------------------------
$ 3,267,351
-----------------------------------------------------------------------------------------------
INSURED-LEASE REVENUE / CERTIFICATES OF PARTICIPATION -- 14.0%
$ 10,000 Garden State New Jersey Preservation Trust, (FSA),
0.00%, 11/1/28 $ 2,968,500
1,250 Middlesex County, (MBIA), 5.00%, 8/1/31 1,304,062
1,000 Puerto Rico Public Building Authority, (CIFG),
Variable Rate, 7/1/36(2)(3) 1,173,130
-----------------------------------------------------------------------------------------------
$ 5,445,692
-----------------------------------------------------------------------------------------------
INSURED-MISCELLANEOUS -- 2.8%
$ 950 Puerto Rico Municipal Finance Agency, (FSA),
Variable Rate, 8/1/27(2)(3) $ 1,104,460
-----------------------------------------------------------------------------------------------
$ 1,104,460
-----------------------------------------------------------------------------------------------
INSURED-PRIVATE EDUCATION -- 5.4%
$ 2,000 New Jersey Educational Facilities Authority,
(Kean University), (FGIC), 5.00%, 7/1/28 $ 2,100,340
-----------------------------------------------------------------------------------------------
$ 2,100,340
-----------------------------------------------------------------------------------------------
INSURED-PUBLIC EDUCATION -- 30.2%
$ 1,400 Monmouth, (Brookdale Community College),
(AMBAC), 5.00%, 8/1/29 $ 1,450,218
1,000 New Jersey Educational Facilities Authority,
(Rowan University), (FGIC), 5.00%, 7/1/27 1,047,060
1,600 New Jersey Educational Facilities Authority,
(Rowan University), (FGIC), 5.00%, 7/1/33 1,669,648
1,500 New Jersey Educational Facilities Authority,
(Rowan University), (FGIC), 5.125%, 7/1/30 1,589,415
775 Rutgers University, (FGIC), 4.75%, 5/1/27 789,981
500 University of New Jersey Medicine and Dentistry,
(AMBAC), 5.00%, 12/1/31 523,045
4,490 University of New Jersey Medicine and Dentistry,
(AMBAC), 5.00%, 4/15/32 4,703,365
-----------------------------------------------------------------------------------------------
$ 11,772,732
-----------------------------------------------------------------------------------------------
INSURED-SEWER REVENUE -- 6.5%
$ 900 Long Branch Sewer Authority, (FGIC), 4.75%, 6/1/23 $ 941,049
2,350 Passaic Valley Sewer Commissioners, (FGIC),
2.50%, 12/1/32 1,591,608
-----------------------------------------------------------------------------------------------
$ 2,532,657
-----------------------------------------------------------------------------------------------
INSURED-TRANSPORTATION -- 17.1%
$ 4,000 Delaware River and Bay Authority, (MBIA),
5.00%, 1/1/33 $ 4,191,720
1,290 Port Authority of New York and New Jersey,
(FSA), Variable Rate, 11/1/27(2)(3) 1,488,957
950 South Jersey Transportation Authority,
(AMBAC), 5.00%, 11/1/29 987,991
-----------------------------------------------------------------------------------------------
$ 6,668,668
-----------------------------------------------------------------------------------------------
INSURED-WATER AND SEWER -- 4.3%
$ 4,500 Middlesex County Improvements Authority Utilities
System, (Perth Amboy), (AMBAC), 0.00%, 9/1/24 $ 1,676,520
-----------------------------------------------------------------------------------------------
$ 1,676,520
-----------------------------------------------------------------------------------------------
See notes to financial statements
23
PRINCIPAL AMOUNT
(000'S OMITTED) SECURITY VALUE
-----------------------------------------------------------------------------------------------
INSURED-WATER REVENUE -- 1.5%
$ 600 Bayonne Municipal Utilities Authority, Water and
Sewer Revenue, (XLCA), Variable Rate, 4/1/28(2)(3) $ 594,228
-----------------------------------------------------------------------------------------------
$ 594,228
-----------------------------------------------------------------------------------------------
LEASE REVENUE / CERTIFICATES OF PARTICIPATION -- 4.0%
$ 1,500 New Jersey EDA, (School Facilities), 5.00%, 6/15/26 $ 1,566,855
-----------------------------------------------------------------------------------------------
$ 1,566,855
-----------------------------------------------------------------------------------------------
OTHER REVENUE -- 2.6%
$ 1,000 New Jersey Environmental Infrastructure Trust,
4.75%, 9/1/23 $ 1,025,420
-----------------------------------------------------------------------------------------------
$ 1,025,420
-----------------------------------------------------------------------------------------------
SENIOR LIVING / LIFE CARE -- 1.5%
$ 600 New Jersey EDA, (Fellowship Village), 5.50%, 1/1/25 $ 599,574
-----------------------------------------------------------------------------------------------
$ 599,574
-----------------------------------------------------------------------------------------------
TRANSPORTATION -- 13.4%
$ 300 Delaware River Joint Toll Bridge Commission,
5.00%, 7/1/24 $ 311,112
700 Delaware River Joint Toll Bridge Commission,
5.00%, 7/1/28 723,142
2,250 Port Authority of New York and New Jersey,
5.00%, 9/1/38 2,328,143
1,825 South Jersey Port Authority, (Marine Terminal),
5.10%, 1/1/33 1,875,553
-----------------------------------------------------------------------------------------------
$ 5,237,950
-----------------------------------------------------------------------------------------------
TOTAL TAX-EXEMPT INVESTMENTS -- 155.9%
(IDENTIFIED COST $57,887,515) $ 60,845,531
-----------------------------------------------------------------------------------------------
OTHER ASSETS, LESS LIABILITIES -- 1.7% $ 687,581
-----------------------------------------------------------------------------------------------
AUCTION PREFERRED SHARES PLUS CUMULATIVE
UNPAID DIVIDENDS -- (57.6)% $ (22,501,114)
-----------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO
COMMON SHARES -- 100.0% $ 39,031,998
-----------------------------------------------------------------------------------------------
AMBAC - AMBAC Financial Group, Inc.
CIFG - CDC IXIS Financial Guaranty North America, Inc.
FGIC - Financial Guaranty Insurance Company
FSA - Financial Security Assurance, Inc.
MBIA - Municipal Bond Insurance Association
XLCA - XL Capital Assurance, Inc.
The Fund invests primarily in debt securities issued by New Jersey
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at March 31, 2004, 83.0% of the securities in the portfolio of
investments are backed by bond insurance of various financial institutions and
financial guaranty assurance agencies. The aggregate percentage insured by an
individual financial institution ranged from 1.0% to 30.5% of total investments.
(1) Security (or a portion thereof) has been segregated to cover margin
requirements on open financial futures contracts.
(2) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
(3) Security has been issued as a leveraged inverse floater bond.
See notes to financial statements
24
INSURED NEW YORK MUNICIPAL BOND FUND II as of March 31, 2004
PORTFOLIO OF INVESTMENTS (Unaudited)
TAX-EXEMPT INVESTMENTS -- 154.9%
PRINCIPAL AMOUNT
(000'S OMITTED) SECURITY VALUE
-----------------------------------------------------------------------------------------------
GENERAL OBLIGATIONS -- 7.2%
$ 2,650 New York, NY, 5.25%, 1/15/28 $ 2,779,055
-----------------------------------------------------------------------------------------------
$ 2,779,055
-----------------------------------------------------------------------------------------------
HOSPITAL -- 2.0%
$ 750 Suffolk County Industrial Development Agency,
(Huntington Hospital), 5.875%, 11/1/32 $ 787,140
-----------------------------------------------------------------------------------------------
$ 787,140
-----------------------------------------------------------------------------------------------
INSURED-ELECTRIC UTILITIES -- 7.6%
$ 6,800 Long Island Power Authority Electric Systems Revenue,
(FSA), 0.00%, 6/1/22 $ 2,942,292
-----------------------------------------------------------------------------------------------
$ 2,942,292
-----------------------------------------------------------------------------------------------
INSURED-ESCROWED / PREREFUNDED -- 4.4%
$ 1,500 New York University Dormitory Authority, (State University),
(XLCA), Prerefunded to 7/1/12, 5.00%, 7/1/25 $ 1,695,510
-----------------------------------------------------------------------------------------------
$ 1,695,510
-----------------------------------------------------------------------------------------------
INSURED-GENERAL OBLIGATIONS -- 10.2%
$ 500 Puerto Rico, (FGIC), Variable Rate, 7/1/32(1)(2) $ 575,905
1,500 Sachem School District, (MBIA), 5.00%, 6/15/27 1,581,945
1,700 Spencerport Central School District, (MBIA),
5.00%, 6/15/22 1,785,323
-----------------------------------------------------------------------------------------------
$ 3,943,173
-----------------------------------------------------------------------------------------------
INSURED-HOSPITAL -- 14.5%
$ 2,250 New York City Health and Hospital Corp.,
(Health Systems), (AMBAC), 5.00%, 2/15/23 $ 2,362,500
6,125 New York Dormitory Authority, (Memorial
Sloan-Kettering Cancer Center), (MBIA), 0.00%, 7/1/26 2,111,104
3,365 New York Dormitory Authority, (Memorial
Sloan-Kettering Cancer Center), (MBIA), 0.00%, 7/1/27 1,103,114
-----------------------------------------------------------------------------------------------
$ 5,576,718
-----------------------------------------------------------------------------------------------
INSURED-LEASE REVENUE / CERTIFICATES OF PARTICIPATION -- 16.6%
$ 1,000 New York City Industrial Development Agency,
(New York University), (AMBAC), 5.00%, 7/1/31 $ 1,035,890
4,005 New York Urban Development Corp.,
(Personal Income Tax), (FGIC), 5.00%, 3/15/33 4,173,651
$ 1,000 Puerto Rico Public Building Authority, (CIFG),
Variable Rate, 7/1/36(1)(2) $ 1,173,130
-----------------------------------------------------------------------------------------------
$ 6,382,671
-----------------------------------------------------------------------------------------------
INSURED-MISCELLANEOUS -- 4.6%
$ 1,000 New York City Cultural Resource Trust, (Museum of
Modern Art), (AMBAC), 5.125%, 7/1/31 $ 1,054,240
580 New York City Trust Cultural Resources, (Museum of
History), (AMBAC), Variable Rate, 7/1/29(1)(2) 728,497
-----------------------------------------------------------------------------------------------
$ 1,782,737
-----------------------------------------------------------------------------------------------
INSURED-PRIVATE EDUCATION -- 18.6%
$ 2,500 New York Dormitory Authority, (Brooklyn Law School),
(XLCA), 5.125%, 7/1/30 $ 2,625,675
1,500 New York Dormitory Authority, (Fordham University),
(FGIC), 5.00%, 7/1/32 1,558,965
1,000 New York Dormitory Authority, (New York University),
(AMBAC), 5.00%, 7/1/31 1,035,890
750 New York Dormitory Authority, (New York University),
(AMBAC), 5.00%, 7/1/41 772,695
1,125 New York Dormitory Authority, (University of Rochester),
(MBIA), 5.00%, 7/1/27 1,161,281
-----------------------------------------------------------------------------------------------
$ 7,154,506
-----------------------------------------------------------------------------------------------
INSURED-PUBLIC EDUCATION -- 6.6%
$ 2,245 New York Dormitory Authority, (School Districts
Financing Program), (MBIA), 5.00%, 10/1/30 $ 2,338,863
200 New York Dormitory Authority, (Upstate
Community College), (MBIA), 5.00%, 7/1/27 208,284
-----------------------------------------------------------------------------------------------
$ 2,547,147
-----------------------------------------------------------------------------------------------
INSURED-SPECIAL TAX REVENUE -- 6.6%
$ 2,500 New York City Transitional Finance Authority,
(MBIA), 4.75%, 5/1/23 $ 2,538,825
-----------------------------------------------------------------------------------------------
$ 2,538,825
-----------------------------------------------------------------------------------------------
INSURED-TRANSPORTATION -- 21.1%
$ 1,000 Metropolitan Transportation Authority, (FGIC),
5.00%, 11/15/31 $ 1,036,150
2,000 Metropolitan Transportation Authority, (FGIC),
5.25%, 11/15/31 2,133,360
750 Metropolitan Transportation Authority, (FSA),
5.00%, 11/15/30 781,688
See notes to financial statements
25
PRINCIPAL AMOUNT
(000'S OMITTED) SECURITY VALUE
-----------------------------------------------------------------------------------------------
INSURED-TRANSPORTATION (CONTINUED)
$ 835 Port Authority of New York and New Jersey,
(FSA), Variable Rate, 11/1/27(1)(2) $ 963,782
1,000 Puerto Rico Highway and Transportation Authority,
(AMBAC), Variable Rate, 7/1/28(1)(2) 1,113,920
$ 2,000 Triborough Bridge and Tunnel Authority, (MBIA),
5.00%, 11/15/32 $ 2,081,600
-----------------------------------------------------------------------------------------------
$ 8,110,500
-----------------------------------------------------------------------------------------------
INSURED-WATER AND SEWER -- 13.6%
$ 2,700 New York City Municipal Water Finance Authority,
(Water and Sewer System), (FGIC), 4.75%, 6/15/31(3) $ 2,719,008
2,400 Niagara Falls, Public Water Authority and Sewer
System, (MBIA), 5.00%, 7/15/34 2,503,080
-----------------------------------------------------------------------------------------------
$ 5,222,088
-----------------------------------------------------------------------------------------------
INSURED-WATER REVENUE -- 4.7%
$ 750 Buffalo Municipal Water Finance Authority, (FSA),
5.00%, 7/1/27 $ 782,123
1,000 Buffalo Municipal Water Finance Authority, (FSA),
5.125%, 7/1/32 1,049,990
-----------------------------------------------------------------------------------------------
$ 1,832,113
-----------------------------------------------------------------------------------------------
MISCELLANEOUS -- 1.8%
$ 500 Puerto Rico Infrastructure Financing Authority,
Variable Rate, 10/1/32(1)(2) $ 677,150
-----------------------------------------------------------------------------------------------
$ 677,150
-----------------------------------------------------------------------------------------------
PRIVATE EDUCATION -- 4.0%
$ 1,000 Dutchess County, Industrial Development Agency,
(Marist College), 5.00%, 7/1/22 $ 1,027,130
500 Rensselaer County Industrial Development Agency,
(Rensselaer Polytech Institute), 5.125%, 8/1/27 514,645
-----------------------------------------------------------------------------------------------
$ 1,541,775
-----------------------------------------------------------------------------------------------
TRANSPORTATION -- 10.8%
$ 1,500 Port Authority of New York and New Jersey,
5.00%, 9/1/38 $ 1,552,095
2,500 Triborough Bridge and Tunnel Authority,
5.125%, 1/1/31 2,606,925
-----------------------------------------------------------------------------------------------
$ 4,159,020
-----------------------------------------------------------------------------------------------
TOTAL TAX-EXEMPT INVESTMENTS -- 154.9%
(IDENTIFIED COST $56,799,311) $ 59,672,420
-----------------------------------------------------------------------------------------------
OTHER ASSETS, LESS LIABILITIES -- 3.5% $ 1,340,983
-----------------------------------------------------------------------------------------------
AUCTION PREFERRED SHARES PLUS CUMULATIVE
UNPAID DIVIDENDS -- (58.4)% $ (22,500,574)
-----------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO
COMMON SHARES -- 100.0% $ 38,512,829
-----------------------------------------------------------------------------------------------
AMBAC - AMBAC Financial Group, Inc.
CIFG - CDC IXIS Financial Guaranty North America, Inc.
FGIC - Financial Guaranty Insurance Company
FSA - Financial Security Assurance, Inc.
MBIA - Municipal Bond Insurance Association
XLCA - XL Capital Assurance, Inc.
The Fund invests primarily in debt securities issued by New York municipalities.
The ability of the issuers of the debt securities to meet their obligations may
be affected by economic developments in a specific industry or municipality. In
order to reduce the risk associated with such economic developments, at March
31, 2004, 83.3% of the securities in the portfolio of investments are backed by
bond insurance of various financial institutions and financial guaranty
assurance agencies. The aggregate percentage insured by an individual financial
institution ranged from 2.0% to 29.2% of total investments.
(1) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
(2) Security has been issued as a leveraged inverse floater bond.
(3) Security (or a portion thereof) has been segregated to cover margin
requirements on open financial futures contracts.
See notes to financial statements
26
INSURED OHIO MUNICIPAL BOND FUND as of March 31, 2004
PORTFOLIO OF INVESTMENTS (Unaudited)
TAX-EXEMPT INVESTMENTS -- 158.3%
PRINCIPAL AMOUNT
(000'S OMITTED) SECURITY VALUE
-----------------------------------------------------------------------------------------------
ESCROWED / PREREFUNDED -- 2.8%
$ 925 Ohio, (Infrastructure Improvements),
Prerefunded to 3/01/12, 4.875%, 3/1/23 $ 1,030,866
-----------------------------------------------------------------------------------------------
$ 1,030,866
-----------------------------------------------------------------------------------------------
GENERAL OBLIGATIONS -- 9.6%
$ 3,415 Granville School District, 5.00%, 12/1/24 $ 3,531,178
-----------------------------------------------------------------------------------------------
$ 3,531,178
-----------------------------------------------------------------------------------------------
HOSPITAL -- 2.6%
$ 900 Cuyahoga County, (Cleveland Clinic Health System),
5.50%, 1/1/29 $ 942,093
-----------------------------------------------------------------------------------------------
$ 942,093
-----------------------------------------------------------------------------------------------
INSURED-ELECTRIC UTILITIES -- 9.6%
$ 4,000 Ohio Municipal Electric Generation Agency, (MBIA),
0.00%, 2/15/25 $ 1,389,920
1,775 Ohio Municipal Electric Generation Agency, (MBIA),
0.00%, 2/15/26 581,472
5,000 Ohio Municipal Electric Generation Agency, (MBIA),
0.00%, 2/15/27 1,549,900
-----------------------------------------------------------------------------------------------
$ 3,521,292
-----------------------------------------------------------------------------------------------
INSURED-GENERAL OBLIGATIONS -- 46.8%
$ 1,500 Ashtabula School District, (Construction Improvements),
(FGIC), 5.00%, 12/1/30(1) $ 1,560,345
2,000 Cincinnati School District, (School Improvements),
(FSA), 5.00%, 12/1/22 2,112,880
2,500 Cuyahoga Community College District, (AMBAC),
5.00%, 12/1/32 2,606,125
2,500 Olentangy School District, (School Facility Construction
and Improvements), (MBIA), 5.00%, 12/1/30 2,600,575
1,400 Plain School District, (FGIC), 0.00%, 12/1/27 427,966
2,500 Plain School District, (FGIC), 5.00%, 12/1/30 2,605,300
1,400 Powell, (FGIC), 5.50%, 12/1/32 1,526,308
2,600 Trotwood-Madison School District, (School
Improvements), (FGIC), 5.00%, 12/1/30 2,704,598
1,000 Zanesville School District, (School Improvements),
(MBIA), 5.05%, 12/1/29 1,051,660
-----------------------------------------------------------------------------------------------
$ 17,195,757
-----------------------------------------------------------------------------------------------
INSURED-HOSPITAL -- 5.6%
$ 2,000 Franklin County, (Ohio Health Corp.), (MBIA),
5.00%, 5/15/33 $ 2,061,200
-----------------------------------------------------------------------------------------------
$ 2,061,200
-----------------------------------------------------------------------------------------------
INSURED-LEASE REVENUE / CERTIFICATES OF PARTICIPATION -- 12.7%
$ 1,400 Cleveland, (Cleveland Stadium), (AMBAC),
5.25%, 11/15/27 $ 1,481,144
1,000 Puerto Rico Public Building Authority, (CIFG),
Variable Rate, 7/1/36(2)(3) 1,173,130
900 Puerto Rico Public Buildings Authority, Government
Facility Revenue, (XLCA), 5.25%, 7/1/36 962,856
1,000 Summit County, (Civic Theater Project), (AMBAC),
5.00%, 12/1/33 1,035,010
-----------------------------------------------------------------------------------------------
$ 4,652,140
-----------------------------------------------------------------------------------------------
INSURED-MISCELLANEOUS -- 0.9%
$ 280 Puerto Rico Municipal Finance Agency, (FSA),
Variable Rate, 8/1/27(2)(3) $ 325,525
-----------------------------------------------------------------------------------------------
$ 325,525
-----------------------------------------------------------------------------------------------
INSURED-PUBLIC EDUCATION -- 16.6%
$ 3,000 Cincinnati Technical and Community College,
(AMBAC), 5.00%, 10/1/28 $ 3,131,430
1,170 Ohio University, (FSA), 5.25%, 12/1/23 1,268,163
500 University of Akron, (FGIC), Variable
Rate, 1/1/29(2)(4) 669,665
1,000 University of Cincinnati, (AMBAC), 5.00%, 6/1/31 1,040,960
-----------------------------------------------------------------------------------------------
$ 6,110,218
-----------------------------------------------------------------------------------------------
INSURED-SPECIAL TAX REVENUE -- 15.5%
$ 4,315 Hamilton County, Sales Tax, (AMBAC),
0.00%, 12/1/22 $ 1,784,339
5,000 Hamilton County, Sales Tax, (AMBAC), 0.00%, 12/1/23 1,942,750
1,000 Hamilton County, Sales Tax, (AMBAC), 0.00%, 12/1/24 362,990
875 Puerto Rico Infrastructure Financing Authority,
(AMBAC), Variable Rate, 7/1/28(2)(4) 936,119
615 Puerto Rico Infrastructure Financing Authority,
(AMBAC), Variable Rate, 7/1/28(3) 679,440
-----------------------------------------------------------------------------------------------
$ 5,705,638
-----------------------------------------------------------------------------------------------
See notes to financial statements
27
PRINCIPAL AMOUNT
(000'S OMITTED) SECURITY VALUE
-----------------------------------------------------------------------------------------------
INSURED-TRANSPORTATION -- 16.0%
$ 4,750 Cleveland Airport System, (FSA), 5.00%, 1/1/31 $ 4,901,953
885 Puerto Rico Highway and Transportation Authority,
(AMBAC), Variable Rate, 7/1/28(2)(3) 985,819
-----------------------------------------------------------------------------------------------
$ 5,887,772
-----------------------------------------------------------------------------------------------
INSURED-WATER AND SEWER -- 10.8%
$ 3,800 Cleveland Waterworks, (FGIC), 5.00%, 1/1/25 $ 3,954,432
-----------------------------------------------------------------------------------------------
$ 3,954,432
-----------------------------------------------------------------------------------------------
POOLED LOANS -- 0.6%
$ 190 Rickenbacker Port Authority Capital Funding
(Oasbo), 5.375%, 1/1/32 $ 205,417
-----------------------------------------------------------------------------------------------
$ 205,417
-----------------------------------------------------------------------------------------------
PRIVATE EDUCATION -- 8.2%
$ 1,000 Ohio Higher Educational Facilities Authority,
(Oberlin College), 5.00%, 10/1/33 $ 1,039,480
1,000 Ohio Higher Educational Facilities Authority,
(Oberlin College), Variable Rate, 10/1/29(2)(4) 1,064,350
850 Ohio Higher Educational Facilities Commission,
(John Carroll University), 5.25%, 11/15/33 895,560
-----------------------------------------------------------------------------------------------
$ 2,999,390
-----------------------------------------------------------------------------------------------
TOTAL TAX-EXEMPT INVESTMENTS -- 158.3%
(IDENTIFIED COST $55,865,133) $ 58,122,918
-----------------------------------------------------------------------------------------------
OTHER ASSETS, LESS LIABILITIES -- 1.3% $ 468,500
-----------------------------------------------------------------------------------------------
AUCTION PREFERRED SHARES PLUS CUMULATIVE
UNPAID DIVIDENDS -- (59.6)% $ (21,876,704)
-----------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO
COMMON SHARES -- 100.0% $ 36,714,714
-----------------------------------------------------------------------------------------------
AMBAC - AMBAC Financial Group, Inc.
CIFG - CDC IXIS Financial Guaranty North America, Inc.
FGIC - Financial Guaranty Insurance Company
FSA - Financial Security Assurance, Inc.
MBIA - Municipal Bond Insurance Association
XLCA - XL Capital Assurance, Inc.
The Fund invests primarily in debt securities issued by Ohio municipalities. The
ability of the issuers of the debt securities to meet their obligations may be
affected by economic developments in a specific industry or municipality. In
order to reduce the risk associated with such economic developments, at March
31, 2004, 85.0% of the securities in the portfolio of investments are backed by
bond insurance of various financial institutions and financial guaranty
assurance agencies. The aggregate percentage insured by an individual financial
institution ranged from 1.7% to 27.5% of total investments.
(1) Security (or a portion thereof) has been segregated to cover margin
requirements on open financial futures contracts.
(2) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
(3) Security has been issued as a leveraged inverse floater bond.
(4) Security has been issued as an inverse floater bond.
See notes to financial statements
28
INSURED PENNSYLVANIA MUNICIPAL BOND FUND as of March 31, 2004
PORTFOLIO OF INVESTMENTS (Unaudited)
TAX-EXEMPT INVESTMENTS -- 157.1%
PRINCIPAL AMOUNT
(000'S OMITTED) SECURITY VALUE
-----------------------------------------------------------------------------------------------
ELECTRIC UTILITIES -- 0.8%
$ 325 Puerto Rico Electric Power Authority,
Variable Rate, 7/1/29(1)(2) $ 354,165
-----------------------------------------------------------------------------------------------
$ 354,165
-----------------------------------------------------------------------------------------------
HOSPITAL -- 8.0%
$ 750 Lancaster County Hospital Authority, 5.50%, 3/15/26 $ 777,105
350 Lebanon County Health Facility Authority, (Good
Samaritan Hospital), 6.00%, 11/15/35 362,120
1,500 Lehigh County General Purpose Authority, (Lehigh Valley
Health Network), 5.25%, 7/1/32 1,543,560
750 Pennsylvania HEFA, (UPMC Health System),
6.00%, 1/15/31 805,867
-----------------------------------------------------------------------------------------------
$ 3,488,652
-----------------------------------------------------------------------------------------------
INSURED-ELECTRIC UTILITIES -- 4.5%
$ 400 Puerto Rico Electric Power Authority, (FSA), Variable
Rate, 7/1/29(2)(3) $ 485,320
1,400 Puerto Rico Electric Power Authority, (FSA),
5.125%, 7/1/26 1,501,430
-----------------------------------------------------------------------------------------------
$ 1,986,750
-----------------------------------------------------------------------------------------------
INSURED-ESCROWED / PREREFUNDED -- 2.3%
$ 1,000 Pennsylvania Turnpike Commision, Oil Franchise Tax,
(AMBAC), Escrowed to Maturity, 4.75%, 12/1/27 $ 1,022,740
-----------------------------------------------------------------------------------------------
$ 1,022,740
-----------------------------------------------------------------------------------------------
INSURED-GAS UTILITIES -- 5.3%
$ 1,355 Philadelphia Natural Gas Works, (FSA),
5.125%, 8/1/31 $ 1,413,942
875 Philadelphia Natural Gas Works, (FSA),
Variable Rate, 7/1/28(1) 914,156
-----------------------------------------------------------------------------------------------
$ 2,328,098
-----------------------------------------------------------------------------------------------
INSURED-GENERAL OBLIGATIONS -- 46.2%
$ 250 Allegheny County, (FGIC), 5.25%, 11/1/21 $ 269,438
1,650 Armstrong County, (MBIA), 5.40%, 6/1/31 1,759,676
4,845 Canon McMillan School District, (FGIC), 0.00%, 12/1/33 1,062,654
500 Canon McMillan School District, (FGIC), 5.25%, 12/1/34 530,320
1,000 Cranberry Township, (FGIC), 5.00%, 12/1/25 1,040,280
4,500 East Allegheny School District, (FGIC), 5.00%, 4/1/32 4,665,690
1,080 Fairview School District, (FGIC), 5.125%, 2/1/29 1,128,352
$ 1,000 Gateway, School District Alleghany County, (FGIC),
5.00%, 10/15/32 $ 1,042,120
2,555 McKeesport School District, (MBIA), 0.00%, 10/1/21 1,108,691
2,000 Pennridge School District, (MBIA), 5.00%, 2/15/29 2,082,180
500 Philadelphia, (FSA), 5.00%, 9/15/31 516,435
300 Philadelphia, (FSA), 5.25%, 9/15/25 317,064
585 Philadelphia, (FSA), Variable Rate, 9/15/31(2)(3) 642,699
1,000 Pine-Richland School District, (FSA), 5.00%, 9/1/29 1,035,980
400 Puerto Rico, (FGIC), Variable Rate, 7/1/32(2)(3) 460,724
2,500 Upper Clair Township School District, (FSA),
5.00%, 7/15/32 2,594,275
-----------------------------------------------------------------------------------------------
$ 20,256,578
-----------------------------------------------------------------------------------------------
INSURED-HOSPITAL -- 5.9%
$ 2,500 Washington County Hospital Authority, (Washington
Hospital), (AMBAC), 5.125%, 7/1/28 $ 2,579,650
-----------------------------------------------------------------------------------------------
$ 2,579,650
-----------------------------------------------------------------------------------------------
INSURED-INDUSTRIAL DEVELOPMENT REVENUE -- 4.0%
$ 1,700 Allegheny County IDA, (MBIA), 5.00%, 11/1/29 $ 1,768,867
-----------------------------------------------------------------------------------------------
$ 1,768,867
-----------------------------------------------------------------------------------------------
INSURED-LEASE REVENUE / CERTIFICATES OF PARTICIPATION -- 7.2%
$ 1,300 Philadelphia Authority for Industrial Development
Lease Revenue, (FSA), 5.125%, 10/1/26 $ 1,363,141
1,700 Philadelphia Authority for Industrial Development
Lease Revenue, (FSA), 5.25%, 10/1/30 1,804,652
-----------------------------------------------------------------------------------------------
$ 3,167,793
-----------------------------------------------------------------------------------------------
INSURED-PRIVATE EDUCATION -- 18.5%
$ 1,000 Chester County IDA Educational Facility, (Westtown
School), (AMBAC), 5.00%, 1/1/31 $ 1,035,980
3,365 Delaware County, (Villanova University), (MBIA),
5.00%, 12/1/28 3,461,172
3,000 Pennsylvania HEFA, (Temple University), (MBIA),
5.00%, 4/1/29(4) 3,087,780
500 Pennsylvania Public School Building Authority,
(Lehigh Career and Technical Institute), (MBIA),
5.00%, 10/1/31 517,535
-----------------------------------------------------------------------------------------------
$ 8,102,467
-----------------------------------------------------------------------------------------------
See notes to financial statements
29
PRINCIPAL AMOUNT
(000'S OMITTED) SECURITY VALUE
-----------------------------------------------------------------------------------------------
INSURED-PUBLIC EDUCATION -- 4.8%
$ 1,000 Lycoming County Authority, (Pennsylvania College of
Technology), (AMBAC), 5.25%, 5/1/32 $ 1,058,090
1,000 Pennsylvania HEFA, (Clarion University Foundation),
(XLCA), 5.00%, 7/1/33 1,035,510
-----------------------------------------------------------------------------------------------
$ 2,093,600
-----------------------------------------------------------------------------------------------
INSURED-SPECIAL TAX REVENUE -- 10.2%
$ 4,350 Pittsburgh and Allegheny County Public Auditorium,
(AMBAC), 5.00%, 2/1/29 $ 4,486,590
-----------------------------------------------------------------------------------------------
$ 4,486,590
-----------------------------------------------------------------------------------------------
INSURED-TRANSPORTATION -- 21.8%
$ 2,000 Allegheny County Port Authority, (FGIC),
5.00%, 3/1/25 $ 2,082,800
1,000 Allegheny County Port Authority, (FGIC),
5.00%, 3/1/29 1,038,010
1,500 Pennsylvania Turnpike Commission Registration Fee,
(AMBAC), 5.00%, 7/15/31 1,562,130
3,750 Pennsylvania Turnpike Commission, (AMBAC),
5.00%, 7/15/41 3,880,725
815 Puerto Rico Highway and Transportation Authority,
(MBIA), Variable Rate, 7/1/36(2)(3) 976,753
-----------------------------------------------------------------------------------------------
$ 9,540,418
-----------------------------------------------------------------------------------------------
INSURED-WATER AND SEWER -- 14.3%
$ 1,555 Erie Sewer Authority, (AMBAC), 0.00%, 12/1/25 $ 522,667
2,155 Erie Sewer Authority, (AMBAC), 0.00%, 12/1/25 724,339
1,920 Erie Sewer Authority, (AMBAC), 0.00%, 12/1/26 610,963
2,500 Pennsylvania University Sewer Authority, (MBIA),
5.00%, 11/1/26 2,598,200
1,000 Philadelphia Water & Wastewater, (FGIC),
Variable Rate, 11/1/31(2)(3) 1,117,620
580 Pittsburgh Water and Sewer Authority, (AMBAC),
Variable Rate, 12/1/27(2)(3) 667,365
-----------------------------------------------------------------------------------------------
$ 6,241,154
-----------------------------------------------------------------------------------------------
TRANSPORTATION -- 3.3%
$ 1,400 Delaware River Joint Toll Bridge Commission,
5.00%, 7/1/28 $ 1,446,284
-----------------------------------------------------------------------------------------------
$ 1,446,284
-----------------------------------------------------------------------------------------------
TOTAL TAX-EXEMPT INVESTMENTS -- 157.1%
(IDENTIFIED COST $66,214,453) $ 68,863,806
-----------------------------------------------------------------------------------------------
OTHER ASSETS, LESS LIABILITIES -- 2.2% $ 981,328
-----------------------------------------------------------------------------------------------
AUCTION PREFERRED SHARES PLUS CUMULATIVE
UNPAID DIVIDENDS -- (59.3)% $ (26,003,852)
-----------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO
COMMON SHARES -- 100.0% $ 43,841,282
-----------------------------------------------------------------------------------------------
AMBAC - AMBAC Financial Group, Inc.
FGIC - Financial Guaranty Insurance Company
FSA - Financial Security Assurance, Inc.
MBIA - Municipal Bond Insurance Association
XLCA - XL Capital Assurance, Inc.
The Fund invests primarily in debt securities issued by Pennsylvania
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at March 31, 2004, 92.3% of the securities in the portfolio of
investments are backed by bond insurance of various financial institutions and
financial guaranty assurance agencies. The aggregate percentage insured by an
individual financial institution ranged from 1.5% to 26.4% of total investments.
(1) Security has been issued as an inverse floater bond.
(2) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
(3) Security has been issued as a leveraged inverse floater bond.
(4) Security (or a portion thereof) has been segregated to cover margin
requirements on open financial futures contracts.
See notes to financial statements
30
EATON VANCE INSURED MUNICIPAL BOND FUNDS as of March 31, 2004
FINANCIAL STATEMENTS (Unaudited)
STATEMENTS OF ASSETS AND LIABILITIES
AS OF MARCH 31, 2004
INSURED INSURED INSURED
MUNICIPAL FUND II CALIFORNIA FUND II FLORIDA FUND
---------------------------------------------------------------------------------------------------------------------------------
ASSETS
Investments --
Identified cost $ 221,850,294 $ 86,337,097 $ 57,237,651
Unrealized appreciation 9,746,018 3,725,866 2,554,644
---------------------------------------------------------------------------------------------------------------------------------
INVESTMENTS, AT VALUE $ 231,596,312 $ 90,062,963 $ 59,792,295
---------------------------------------------------------------------------------------------------------------------------------
Cash 965,399 577,614 --
Interest receivable 3,084,804 1,050,086 1,148,687
Prepaid expenses 85,404 5,946 5,946
---------------------------------------------------------------------------------------------------------------------------------
TOTAL ASSETS $ 235,731,919 $ 91,696,609 $ 60,946,928
---------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Payable for investments purchased $ 1,542,600 $ -- $ --
Payable for daily variation margin on open financial futures contracts 687,500 85,937 58,437
Due to bank -- -- 16,316
Accrued expenses 58,097 26,469 23,047
---------------------------------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES $ 2,288,197 $ 112,406 $ 97,800
---------------------------------------------------------------------------------------------------------------------------------
Auction preferred shares at liquidation value plus cumulative unpaid
dividends 87,539,392 33,750,000 22,501,114
---------------------------------------------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO COMMON SHARES $ 145,904,330 $ 57,834,203 $ 38,348,014
---------------------------------------------------------------------------------------------------------------------------------
SOURCES OF NET ASSETS
Common Shares, $0.01 par value, unlimited number of shares authorized $ 99,147 $ 38,522 $ 25,596
Additional paid-in capital 140,587,855 54,601,713 36,279,545
Accumulated net realized loss (computed on the basis of identified cost) (3,463,631) (658,172) (507,545)
Accumulated undistributed net investment income 1,243,878 413,915 191,370
Net unrealized appreciation (computed on the basis of identified cost) 7,437,081 3,438,225 2,359,048
---------------------------------------------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO COMMON SHARES $ 145,904,330 $ 57,834,203 $ 38,348,014
---------------------------------------------------------------------------------------------------------------------------------
AUCTION PREFERRED SHARES ISSUED AND OUTSTANDING
(LIQUIDATION PREFERENCE OF $25,000 PER SHARE)
3,500 1,350 900
---------------------------------------------------------------------------------------------------------------------------------
COMMON SHARES OUTSTANDING
9,914,712 3,852,199 2,559,594
---------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE PER COMMON SHARE
NET ASSETS APPLICABLE TO COMMON SHARES DIVIDED BY COMMON SHARES ISSUED
AND OUTSTANDING $ 14.72 $ 15.01 $ 14.98
---------------------------------------------------------------------------------------------------------------------------------
See notes to financial statements
31
AS OF MARCH 31, 2004
INSURED INSURED INSURED
MASSACHUSETTS FUND MICHIGAN FUND NEW JERSEY FUND
---------------------------------------------------------------------------------------------------------------------------------
ASSETS
Investments --
Identified cost $ 39,456,799 $ 33,818,087 $ 57,887,515
Unrealized appreciation 1,564,985 1,608,451 2,958,016
---------------------------------------------------------------------------------------------------------------------------------
INVESTMENTS, AT VALUE $ 41,021,784 $ 35,426,538 $ 60,845,531
---------------------------------------------------------------------------------------------------------------------------------
Cash $ 12,483 $ 89,350 $ --
Interest receivable 585,697 583,281 808,373
Receivable from the Transfer Agent -- 951 4,003
Prepaid expenses 5,946 -- --
---------------------------------------------------------------------------------------------------------------------------------
TOTAL ASSETS $ 41,625,910 $ 36,100,120 $ 61,657,907
---------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Payable for daily variation margin on open financial futures contracts $ 55,000 $ 48,194 $ 68,750
Due to bank -- -- 41,496
Payable to affiliate for Trustees' fees -- 179 49
Accrued expenses 19,173 13,247 14,500
---------------------------------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES $ 74,173 $ 61,620 $ 124,795
---------------------------------------------------------------------------------------------------------------------------------
Auction preferred shares at liquidation value plus cumulative unpaid
dividends 15,501,860 13,500,336 22,501,114
---------------------------------------------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO COMMON SHARES $ 26,049,877 $ 22,538,164 $ 39,031,998
---------------------------------------------------------------------------------------------------------------------------------
SOURCES OF NET ASSETS
Common Shares, $0.01 par value, unlimited number of shares authorized $ 17,454 $ 15,083 $ 25,563
Additional paid-in capital 24,721,550 21,359,971 36,226,665
Accumulated net realized loss (computed on the basis of identified cost) (302,128) (452,751) (302,647)
Accumulated undistributed net investment income 231,794 173,909 354,123
Net unrealized appreciation (computed on the basis of identified cost) 1,381,207 1,441,952 2,728,294
---------------------------------------------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO COMMON SHARES $ 26,049,877 $ 22,538,164 $ 39,031,998
---------------------------------------------------------------------------------------------------------------------------------
AUCTION PREFERRED SHARES ISSUED AND OUTSTANDING
(LIQUIDATION PREFERENCE OF $25,000 PER SHARE)
620 540 900
---------------------------------------------------------------------------------------------------------------------------------
COMMON SHARES OUTSTANDING
1,745,386 1,508,282 2,556,260
---------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE PER COMMON SHARE
NET ASSETS APPLICABLE TO COMMON SHARES DIVIDED BY COMMON SHARES ISSUED
AND OUTSTANDING $ 14.92 $ 14.94 $ 15.27
---------------------------------------------------------------------------------------------------------------------------------
See notes to financial statements
32
AS OF MARCH 31, 2004
INSURED INSURED INSURED
NEW YORK FUND II OHIO FUND PENNSYLVANIA FUND
----------------------------------------------------------------------------------------------------------------------------------
ASSETS
Investments --
Identified cost $ 56,799,311 $ 55,865,133 $ 66,214,453
Unrealized appreciation 2,873,109 2,257,785 2,649,353
----------------------------------------------------------------------------------------------------------------------------------
INVESTMENTS, AT VALUE $ 59,672,420 $ 58,122,918 $ 68,863,806
----------------------------------------------------------------------------------------------------------------------------------
Cash $ 662,732 $ -- $ 63,894
Interest receivable 786,336 863,107 1,000,438
Receivable from the Transfer Agent -- 6,089 2,409
Prepaid expenses -- 5,945 --
----------------------------------------------------------------------------------------------------------------------------------
TOTAL ASSETS $ 61,121,488 $ 58,998,059 $ 69,930,547
----------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Payable for daily variation margin on open financial futures contracts $ 85,937 $ 113,437 $ 66,000
Due to bank -- 268,665 --
Payable to affiliate for Trustees' fees -- -- 844
Accrued expenses 22,148 24,539 18,569
----------------------------------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES $ 108,085 $ 406,641 $ 85,413
----------------------------------------------------------------------------------------------------------------------------------
Auction preferred shares at liquidation value plus cumulative unpaid
dividends 22,500,574 21,876,704 26,003,852
----------------------------------------------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO COMMON SHARES $ 38,512,829 $ 36,714,714 $ 43,841,282
----------------------------------------------------------------------------------------------------------------------------------
SOURCES OF NET ASSETS
Common Shares, $0.01 par value, unlimited number of shares authorized $ 25,536 $ 25,066 $ 29,392
Additional paid-in capital 36,186,792 35,520,838 41,656,893
Accumulated net realized loss (computed on the basis of identified cost) (540,664) (834,965) (523,220)
Accumulated undistributed net investment income 256,673 126,965 249,772
Net unrealized appreciation (computed on the basis of identified cost) 2,584,492 1,876,810 2,428,445
----------------------------------------------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO COMMON SHARES $ 38,512,829 $ 36,714,714 $ 43,841,282
----------------------------------------------------------------------------------------------------------------------------------
AUCTION PREFERRED SHARES ISSUED AND OUTSTANDING
(LIQUIDATION PREFERENCE OF $25,000 PER SHARE)
900 875 1,040
----------------------------------------------------------------------------------------------------------------------------------
COMMON SHARES OUTSTANDING
2,553,603 2,506,586 2,939,188
----------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE PER COMMON SHARE
NET ASSETS APPLICABLE TO COMMON SHARES DIVIDED BY COMMON SHARES ISSUED
AND OUTSTANDING $ 15.08 $ 14.65 $ 14.92
----------------------------------------------------------------------------------------------------------------------------------
See notes to financial statements
33
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED MARCH 31, 2004
INSURED INSURED INSURED
MUNICIPAL FUND II CALIFORNIA FUND II FLORIDA FUND
---------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
Interest $ 6,467,470 $ 2,343,646 $ 1,567,699
---------------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT INCOME $ 6,467,470 $ 2,343,646 $ 1,567,699
---------------------------------------------------------------------------------------------------------------------------------
EXPENSES
Investment adviser fee $ 646,256 $ 250,523 $ 166,535
Trustees fees and expenses 4,398 3,354 870
Legal and accounting services 22,836 18,635 16,974
Printing and postage 15,005 5,772 4,720
Custodian fee 53,851 22,600 15,310
Transfer and dividend disbursing agent 68,317 25,220 18,165
Preferred shares remarketing agent fee 54,838 42,302 28,202
Miscellaneous 45,433 11,563 9,345
---------------------------------------------------------------------------------------------------------------------------------
TOTAL EXPENSES $ 910,934 $ 379,969 $ 260,121
---------------------------------------------------------------------------------------------------------------------------------
Deduct --
Reduction of custodian fee $ -- $ 3,363 $ 2,087
Reduction of investment adviser fee 176,252 68,325 45,419
---------------------------------------------------------------------------------------------------------------------------------
TOTAL EXPENSE REDUCTIONS $ 176,252 $ 71,688 $ 47,506
---------------------------------------------------------------------------------------------------------------------------------
NET EXPENSES $ 734,682 $ 308,281 $ 212,615
---------------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME $ 5,732,788 $ 2,035,365 $ 1,355,084
---------------------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) --
Investment transactions (identified cost basis) $ 2,559,788 $ 55,714 $ 33,648
Financial futures contracts (7,026,823) (957,749) (696,600)
---------------------------------------------------------------------------------------------------------------------------------
NET REALIZED LOSS $ (4,467,035) $ (902,035) $ (662,952)
---------------------------------------------------------------------------------------------------------------------------------
Change in unrealized appreciation (depreciation) --
Investments (identified cost basis) $ 5,126,876 $ 2,442,101 $ 1,660,414
Financial futures contracts (129,540) 363,828 248,502
---------------------------------------------------------------------------------------------------------------------------------
NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) $ 4,997,336 $ 2,805,929 $ 1,908,916
---------------------------------------------------------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN $ 530,301 $ 1,903,894 $ 1,245,964
---------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS
From net investment income $ (343,034) $ (129,935) $ (82,725)
From net realized gain (171,657) (14,985) (16,866)
---------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO PREFERRED SHAREHOLDERS $ (514,691) $ (144,920) $ (99,591)
---------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 5,748,398 $ 3,794,339 $ 2,501,457
---------------------------------------------------------------------------------------------------------------------------------
See notes to financial statements
34
FOR THE SIX MONTHS ENDED MARCH 31, 2004
INSURED INSURED INSURED
MASSACHUSETTS FUND MICHIGAN FUND NEW JERSEY FUND
---------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
Interest $ 1,127,855 $ 975,248 $ 1,641,719
---------------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT INCOME $ 1,127,855 $ 975,248 $ 1,641,719
---------------------------------------------------------------------------------------------------------------------------------
EXPENSES
Investment adviser fee $ 114,120 $ 98,628 $ 168,107
Trustees fees and expenses 870 266 919
Legal and accounting services 15,660 13,701 14,231
Printing and postage 3,354 745 205
Custodian fee 13,775 10,699 13,480
Transfer and dividend disbursing agent 14,074 12,687 17,416
Preferred shares remarketing agent fee 19,952 16,922 28,202
Miscellaneous 8,634 15,145 16,886
---------------------------------------------------------------------------------------------------------------------------------
TOTAL EXPENSES $ 190,439 $ 168,793 $ 259,446
---------------------------------------------------------------------------------------------------------------------------------
Deduct --
Reduction of investment adviser fee $ 31,123 $ 26,899 $ 45,847
---------------------------------------------------------------------------------------------------------------------------------
TOTAL EXPENSE REDUCTIONS $ 31,123 $ 26,899 $ 45,847
---------------------------------------------------------------------------------------------------------------------------------
NET EXPENSES $ 159,316 $ 141,894 $ 213,599
---------------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME $ 968,539 $ 833,354 $ 1,428,120
---------------------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) --
Investment transactions (identified cost basis) $ 39,490 $ 26,633 $ 143,305
Financial futures contracts (504,956) (404,563) (631,195)
---------------------------------------------------------------------------------------------------------------------------------
NET REALIZED LOSS $ (465,466) $ (377,930) $ (487,890)
---------------------------------------------------------------------------------------------------------------------------------
Change in unrealized appreciation (depreciation) --
Investments (identified cost basis) $ 1,062,571 $ 938,755 $ 2,008,179
Financial futures contracts 174,133 21,470 217,667
---------------------------------------------------------------------------------------------------------------------------------
NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) $ 1,236,704 $ 960,225 $ 2,225,846
---------------------------------------------------------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN $ 771,238 $ 582,295 $ 1,737,956
---------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS
From net investment income $ (47,140) $ (61,258) $ (66,260)
From net realized gain (28,935) -- (38,781)
---------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO PREFERRED SHAREHOLDERS $ (76,075) $ (61,258) $ (105,041)
---------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 1,663,702 $ 1,354,391 $ 3,061,035
---------------------------------------------------------------------------------------------------------------------------------
See notes to financial statements
35
FOR THE SIX MONTHS ENDED MARCH 31, 2004
INSURED INSURED INSURED
NEW YORK FUND II OHIO FUND PENNSYLVANIA FUND
----------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
Interest $ 1,594,983 $ 1,530,929 $ 1,796,945
----------------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT INCOME $ 1,594,983 $ 1,530,929 $ 1,796,945
----------------------------------------------------------------------------------------------------------------------------------
EXPENSES
Investment adviser fee $ 167,735 $ 161,392 $ 191,348
Trustees fees and expenses 870 870 1,714
Legal and accounting services 16,803 17,173 14,518
Printing and postage 4,138 5,842 1,025
Custodian fee 18,113 14,907 13,164
Transfer and dividend disbursing agent 21,177 19,176 21,218
Preferred shares remarketing agent fee 28,202 27,419 32,589
Miscellaneous 14,664 8,613 17,915
----------------------------------------------------------------------------------------------------------------------------------
TOTAL EXPENSES $ 271,702 $ 255,392 $ 293,491
----------------------------------------------------------------------------------------------------------------------------------
Deduct --
Reduction of investment adviser fee $ 45,746 $ 44,016 $ 52,186
----------------------------------------------------------------------------------------------------------------------------------
TOTAL EXPENSE REDUCTIONS $ 45,746 $ 44,016 $ 52,186
----------------------------------------------------------------------------------------------------------------------------------
NET EXPENSES $ 225,956 $ 211,376 $ 241,305
----------------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME $ 1,369,027 $ 1,319,553 $ 1,555,640
----------------------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) --
Investment transactions (identified cost basis) $ 289,348 $ 11,473 $ (15,420)
Increase from payment by affiliate 10,000 -- --
Net loss realized on the disposal of an investment in violation of
restrictions (10,000) -- --
Financial futures contracts (852,294) (1,084,874) (735,661)
----------------------------------------------------------------------------------------------------------------------------------
NET REALIZED LOSS $ (562,946) $ (1,073,401) $ (751,081)
----------------------------------------------------------------------------------------------------------------------------------
Change in unrealized appreciation (depreciation) --
Investments (identified cost basis) $ 1,649,104 $ 1,332,858 $ 1,834,683
Financial futures contracts (35,312) (159,333) 279,529
----------------------------------------------------------------------------------------------------------------------------------
NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) $ 1,613,792 $ 1,173,525 $ 2,114,212
----------------------------------------------------------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN $ 1,050,846 $ 100,124 $ 1,363,131
----------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS
From net investment income $ (56,887) $ (95,912) $ (100,084)
From net realized gain (40,869) (6,904) (32,614)
----------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO PREFERRED SHAREHOLDERS $ (97,756) $ (102,816) $ (132,698)
----------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 2,322,117 $ 1,316,861 $ 2,786,073
----------------------------------------------------------------------------------------------------------------------------------
See notes to financial statements
36
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE SIX MONTHS ENDED MARCH 31, 2004
INSURED INSURED INSURED
INCREASE (DECREASE) IN NET ASSETS MUNICIPAL FUND II CALIFORNIA FUND II FLORIDA FUND
---------------------------------------------------------------------------------------------------------------------------------
From operations --
Net investment income $ 5,732,788 $ 2,035,365 $ 1,355,084
Net realized loss (4,467,035) (902,035) (662,952)
Net change in unrealized appreciation (depreciation) 4,997,336 2,805,929 1,908,916
Distributions to preferred shareholders
From net investment income (343,034) (129,935) (82,725)
From net realized gain (171,657) (14,985) (16,866)
---------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 5,748,398 $ 3,794,339 $ 2,501,457
---------------------------------------------------------------------------------------------------------------------------------
Distributions to common shareholders --
From net investment income $ (4,957,445) $ (1,825,794) $ (1,189,548)
From net realized gain (1,566,389) (231,517) (203,870)
---------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO COMMON SHAREHOLDERS $ (6,523,834) $ (2,057,311) $ (1,393,418)
---------------------------------------------------------------------------------------------------------------------------------
Capital share transactions --
Reinvestment of distributions to common shareholders $ 106,173 $ 13,781 $ 53,868
---------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM CAPITAL SHARE TRANSACTIONS $ 106,173 $ 13,781 $ 53,868
---------------------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS $ (669,263) $ 1,750,809 $ 1,161,907
---------------------------------------------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO COMMON SHARES
At beginning of period $ 146,573,593 $ 56,083,394 $ 37,186,107
---------------------------------------------------------------------------------------------------------------------------------
AT END OF PERIOD $ 145,904,330 $ 57,834,203 $ 38,348,014
---------------------------------------------------------------------------------------------------------------------------------
ACCUMULATED UNDISTRIBUTED
NET INVESTMENT INCOME INCLUDED
IN NET ASSETS APPLICABLE TO COMMON SHARES
AT END OF PERIOD $ 1,243,878 $ 413,915 $ 191,370
---------------------------------------------------------------------------------------------------------------------------------
See notes to financial statements
37
FOR THE SIX MONTHS ENDED MARCH 31, 2004
INSURED INSURED INSURED
INCREASE (DECREASE) IN NET ASSETS MASSACHUSETTS FUND MICHIGAN FUND NEW JERSEY FUND
---------------------------------------------------------------------------------------------------------------------------------
From operations --
Net investment income $ 968,539 $ 833,354 $ 1,428,120
Net realized loss (465,466) (377,930) (487,890)
Net change in unrealized appreciation (depreciation) 1,236,704 960,225 2,225,846
Distributions to preferred shareholders
From net investment income (47,140) (61,258) (66,260)
From net realized gain (28,935) -- (38,781)
---------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 1,663,702 $ 1,354,391 $ 3,061,035
---------------------------------------------------------------------------------------------------------------------------------
Distributions to common shareholders --
From net investment income $ (826,991) $ (714,826) $ (1,226,372)
From net realized gain (392,319) -- (525,716)
---------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO COMMON SHAREHOLDERS $ (1,219,310) $ (714,826) $ (1,752,088)
---------------------------------------------------------------------------------------------------------------------------------
Capital share transactions --
Reinvestment of distributions to common shareholders $ 19,973 $ 5,342 $ 36,263
---------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM CAPITAL SHARE TRANSACTIONS $ 19,973 $ 5,342 $ 36,263
---------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS $ 464,365 $ 644,907 $ 1,345,210
---------------------------------------------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO COMMON SHARES
At beginning of period $ 25,585,512 $ 21,893,257 $ 37,686,788
---------------------------------------------------------------------------------------------------------------------------------
AT END OF PERIOD $ 26,049,877 $ 22,538,164 $ 39,031,998
---------------------------------------------------------------------------------------------------------------------------------
ACCUMULATED UNDISTRIBUTED
NET INVESTMENT INCOME INCLUDED
IN NET ASSETS APPLICABLE TO COMMON SHARES
AT END OF PERIOD $ 231,794 $ 173,909 $ 354,123
---------------------------------------------------------------------------------------------------------------------------------
See notes to financial statements
38
FOR THE SIX MONTHS ENDED MARCH 31, 2004
INSURED INSURED INSURED
INCREASE (DECREASE) IN NET ASSETS NEW YORK FUND II OHIO FUND PENNSYLVANIA FUND
----------------------------------------------------------------------------------------------------------------------------------
From operations --
Net investment income $ 1,369,027 $ 1,319,553 $ 1,555,640
Net realized loss (562,946) (1,073,401) (751,081)
Net change in unrealized appreciation (depreciation) 1,613,792 1,173,525 2,114,212
Distributions to preferred shareholders
From net investment income (56,887) (95,912) (100,084)
From net realized gain (40,869) (6,904) (32,614)
----------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 2,322,117 $ 1,316,861 $ 2,786,073
----------------------------------------------------------------------------------------------------------------------------------
Distributions to common shareholders --
From net investment income $ (1,229,560) $ (1,164,903) $ (1,377,346)
From net realized gain (563,836) (82,913) (412,505)
----------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO COMMON SHAREHOLDERS $ (1,793,396) $ (1,247,816) $ (1,789,851)
----------------------------------------------------------------------------------------------------------------------------------
Capital share transactions --
Reinvestment of distributions to common shareholders $ -- $ 36,126 $ 23,451
----------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM CAPITAL SHARE TRANSACTIONS $ -- $ 36,126 $ 23,451
----------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS $ 528,721 $ 105,171 $ 1,019,673
----------------------------------------------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO COMMON SHARES
At beginning of period $ 37,984,108 $ 36,609,543 $ 42,821,609
----------------------------------------------------------------------------------------------------------------------------------
AT END OF PERIOD $ 38,512,829 $ 36,714,714 $ 43,841,282
----------------------------------------------------------------------------------------------------------------------------------
ACCUMULATED UNDISTRIBUTED
NET INVESTMENT INCOME INCLUDED
IN NET ASSETS APPLICABLE TO COMMON SHARES
AT END OF PERIOD $ 256,673 $ 126,965 $ 249,772
----------------------------------------------------------------------------------------------------------------------------------
See notes to financial statements
39
FOR THE PERIOD ENDED SEPTEMBER 30, 2003(1)
INSURED INSURED INSURED
INCREASE (DECREASE) IN NET ASSETS MUNICIPAL FUND II CALIFORNIA FUND II FLORIDA FUND
---------------------------------------------------------------------------------------------------------------------------------
From operations --
Net investment income $ 8,636,479 $ 3,140,922 $ 1,987,583
Net realized gain 2,695,195 475,791 369,619
Net change in unrealized appreciation (depreciation) 2,439,745 632,296 450,132
Distributions to preferred shareholders from net investment income (701,821) (192,472) (152,002)
---------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 13,069,598 $ 4,056,537 $ 2,655,332
---------------------------------------------------------------------------------------------------------------------------------
Distributions to common shareholders --
From net investment income $ (7,076,834) $ (2,599,597) $ (1,720,498)
---------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO COMMON SHAREHOLDERS $ (7,076,834) $ (2,599,597) $ (1,720,498)
---------------------------------------------------------------------------------------------------------------------------------
Capital share transactions --
Proceeds from sale of common shares(2) $ 141,787,289 $ 55,073,394 $ 36,321,367
Reinvestment of distributions to common shareholders 43,049 363 200,519
Offering costs and preferred shares underwriting discounts (1,349,509) (547,303) (370,613)
---------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM CAPITAL TRANSACTIONS $ 140,480,829 $ 54,526,454 $ 36,151,273
---------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS $ 146,473,593 $ 55,983,394 $ 37,086,107
---------------------------------------------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO COMMON SHARES
At beginning of period $ 100,000 $ 100,000 $ 100,000
---------------------------------------------------------------------------------------------------------------------------------
AT END OF PERIOD $ 146,573,593 $ 56,083,394 $ 37,186,107
---------------------------------------------------------------------------------------------------------------------------------
ACCUMULATED UNDISTRIBUTED
NET INVESTMENT INCOME INCLUDED
IN NET ASSETS APPLICABLE TO COMMON SHARES
AT END OF PERIOD $ 811,569 $ 334,279 $ 108,559
---------------------------------------------------------------------------------------------------------------------------------
(1) For the period from the start of business, November 29, 2002, to September
30, 2003.
(2) Proceeds from the sale of shares net of sales load paid of $6,681,076,
$2,595,081 and $1,711,478 for Insured Municipal Fund II, Insured California
Fund II and Insured Florida Fund, respectively.
See notes to financial statements
40
FOR THE PERIOD ENDED SEPTEMBER 30, 2003(1)
INSURED INSURED INSURED
INCREASE (DECREASE) IN NET ASSETS MASSACHUSETTS FUND MICHIGAN FUND NEW JERSEY FUND
---------------------------------------------------------------------------------------------------------------------------------
From operations --
Net investment income $ 1,418,804 $ 1,230,007 $ 2,087,813
Net realized gain (loss) 579,251 (83,806) 748,013
Net change in unrealized appreciation (depreciation) 144,503 481,727 502,448
Distributions to preferred shareholders from net investment income (99,094) (86,751) (143,861)
---------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 2,043,464 $ 1,541,177 $ 3,194,413
---------------------------------------------------------------------------------------------------------------------------------
Distributions to common shareholders --
From net investment income $ (1,176,983) $ (1,017,632) $ (1,723,590)
---------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO COMMON SHAREHOLDERS $ (1,176,983) $ (1,017,632) $ (1,723,590)
---------------------------------------------------------------------------------------------------------------------------------
Capital share transactions --
Proceeds from sale of common shares(2) $ 24,879,202 $ 21,497,628 $ 36,480,532
Reinvestment of distributions to common shareholders 8,903 8,225 8,074
Offering costs and preferred shares underwriting discounts (269,074) (236,141) (372,641)
---------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM CAPITAL TRANSACTIONS $ 24,619,031 $ 21,269,712 $ 36,115,965
---------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS $ 25,485,512 $ 21,793,257 $ 37,586,788
---------------------------------------------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO COMMON SHARES
At beginning of period $ 100,000 $ 100,000 $ 100,000
---------------------------------------------------------------------------------------------------------------------------------
AT END OF PERIOD $ 25,585,512 $ 21,893,257 $ 37,686,788
---------------------------------------------------------------------------------------------------------------------------------
ACCUMULATED UNDISTRIBUTED
NET INVESTMENT INCOME INCLUDED
IN NET ASSETS APPLICABLE TO COMMON SHARES
AT END OF PERIOD $ 137,386 $ 116,639 $ 218,635
---------------------------------------------------------------------------------------------------------------------------------
(1) For the period from the start of business, November 29, 2002, to September
30, 2003.
(2) Proceeds from sale of shares net of sales load paid of $1,172,318,
$1,012,977 and $1,718,978 for Insured Massachusetts Fund, Insured Michigan
Fund and Insured New Jersey Fund, respectively.
See notes to financial statements
41
FOR THE PERIOD ENDED SEPTEMBER 30, 2003(1)
INSURED INSURED INSURED
INCREASE (DECREASE) IN NET ASSETS NEW YORK FUND II OHIO FUND PENNSYLVANIA FUND
----------------------------------------------------------------------------------------------------------------------------------
From operations --
Net investment income $ 2,077,120 $ 1,922,881 $ 2,350,395
Net realized gain 619,801 311,341 668,618
Net change in unrealized appreciation (depreciation) 970,700 703,285 314,233
Distributions to preferred shareholders from net investment income (143,577) (147,817) (175,228)
----------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 3,524,044 $ 2,789,690 $ 3,158,018
----------------------------------------------------------------------------------------------------------------------------------
Distributions to common shareholders --
From net investment income $ (1,752,264) $ (1,689,925) $ (1,999,243)
----------------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO COMMON SHAREHOLDERS $ (1,752,264) $ (1,689,925) $ (1,999,243)
----------------------------------------------------------------------------------------------------------------------------------
Capital share transactions --
Proceeds from sale of common shares(2) $ 36,480,718 $ 35,761,589 $ 41,979,857
Reinvestment of distributions to common shareholders 4,010 15,937 6,307
Offering costs and preferred shares underwriting discounts (372,400) (367,748) (423,330)
----------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM CAPITAL TRANSACTIONS $ 36,112,328 $ 35,409,778 $ 41,562,834
----------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS $ 37,884,108 $ 36,509,543 $ 42,721,609
----------------------------------------------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO COMMON SHARES
At beginning of period $ 100,000 $ 100,000 $ 100,000
----------------------------------------------------------------------------------------------------------------------------------
AT END OF PERIOD $ 37,984,108 $ 36,609,543 $ 42,821,609
----------------------------------------------------------------------------------------------------------------------------------
ACCUMULATED UNDISTRIBUTED
NET INVESTMENT INCOME INCLUDED
IN NET ASSETS APPLICABLE TO COMMON SHARES
AT END OF PERIOD $ 174,093 $ 68,227 $ 171,562
----------------------------------------------------------------------------------------------------------------------------------
(1) For the period from the start of business, November 29, 2002, to September
30, 2003.
(2) Proceeds from the sale of shares net of sales load paid of $1,718,987,
$1,685,101 and $1,978,108 for Insured New York Fund II, Insured Ohio Fund
and Insured Pennsylvania Fund, respectively.
See notes to financial statements
42
EATON VANCE INSURED MUNICIPAL BOND FUNDS as of March 31, 2004
FINANCIAL STATEMENTS
FINANCIAL HIGHLIGHTS
SELECTED DATA FOR A COMMON SHARE OUTSTANDING DURING THE PERIODS STATED
INSURED MUNICIPAL FUND II
-----------------------------------------------
SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30,
MARCH 31, 2004 ------------------------
(UNAUDITED)(1) 2003(1)(2)
-------------------------------------------------------------------------------------------------------------------------
Net asset value -- Beginning of period (Common shares) $ 14.790 $ 14.325(3)
-------------------------------------------------------------------------------------------------------------------------
INCOME (LOSS) FROM OPERATIONS
Net investment income $ 0.578 $ 0.879
Net realized and unrealized gain 0.062 0.508
Distributions to preferred shareholders
From net investment income (0.035) (0.071)
From net realized gain (0.017) --
-------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME FROM OPERATIONS $ 0.588 $ 1.316
-------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income $ (0.500) $ (0.714)
From net realized gain (0.158) --
-------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO COMMON SHAREHOLDERS $ (0.658) $ (0.714)
-------------------------------------------------------------------------------------------------------------------------
PREFERRED AND COMMON SHARES OFFERING COSTS CHARGED TO PAID-IN CAPITAL $ -- $ (0.048)
-------------------------------------------------------------------------------------------------------------------------
PREFERRED SHARES UNDERWRITING DISCOUNTS $ -- $ (0.089)
-------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE -- END OF PERIOD (COMMON SHARES) $ 14.720 $ 14.790
-------------------------------------------------------------------------------------------------------------------------
MARKET VALUE -- END OF PERIOD (COMMON SHARES) $ 15.450 $ 14.000
-------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT RETURN ON NET ASSET VALUE 4.02%(4) 8.46%(5)
-------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT RETURN ON MARKET VALUE 15.34%(4) 2.67%(5)
-------------------------------------------------------------------------------------------------------------------------
See notes to financial statements
43
SELECTED DATA FOR A COMMON SHARE OUTSTANDING DURING THE PERIODS STATED
INSURED MUNICIPAL FUND II
-----------------------------------------------
SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30,
MARCH 31, 2004 ------------------------
(UNAUDITED)(1) 2003(1)(2)
-------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA+ ++
Net assets applicable to common shares, end of period (000's omitted) $ 145,904 $ 146,574
Ratios (As a percentage of average net assets applicable to common
shares):
Net expenses(6) 1.00%(7) 0.86%(7)
Net expenses after custodian fee reduction(6) 1.00%(7) 0.84%(7)
Net investment income(6) 7.77%(7) 7.14%(7)
Portfolio Turnover 10% 79%
+ The operating expenses of the Fund may reflect a reduction of the
investment adviser fee and/or a reimbursement of expenses by the
Adviser. Had such actions not been taken, the ratios and net
investment income per share would have been as follows:
Ratios (As a percentage of average net assets applicable to common
shares):
Expenses(6) 1.24%(7) 1.09%(7)
Expenses after custodian fee reduction(6) 1.24%(7) 1.07%(7)
Net investment income(6) 7.53%(7) 6.91%(7)
Net investment income per share $ 0.560 $ 0.851
-------------------------------------------------------------------------------------------------------------------------
++ The ratios reported above are based on net assets applicable solely to
common shares. The ratios based on net assets, including amounts
related to preferred shares, are as follows:
Ratios (As a percentage of average total net assets):
Net expenses 0.63%(7) 0.57%(7)
Net expenses after custodian fee reduction 0.63%(7) 0.56%(7)
Net investment income 4.88%(7) 4.72%(7)
+ The operating expenses of the Fund may reflect a reduction of the
investment adviser fee and/or a reimbursement of expenses by the
Adviser. Had such actions not been taken, the ratios would have been
as follows:
Ratios (As a percentage of average total net assets):
Expenses 0.78%(7) 0.72%(7)
Expenses after custodian fee reduction 0.78%(7) 0.71%(7)
Net investment income 4.73%(7) 4.57%(7)
-------------------------------------------------------------------------------------------------------------------------
Senior Securities:
Total preferred shares outstanding 3,500 3,500
Asset coverage per preferred share(8) $ 66,698 $ 66,893
Involuntary liquidation preference per preferred share(9) $ 25,000 $ 25,000
Approximate market value per preferred share(9) $ 25,000 $ 25,000
(1) Computed using average common shares outstanding.
(2) For the period from the start of business, November 29, 2002, to September
30, 2003.
(3) Net asset value at beginning of period reflects the deduction of the sales
load of $0.675 per share paid by the shareholder from the $15.000 offering
price.
(4) Returns are historical and are calculated by determining the percentage
change in net asset value or market value with all distributions
reinvested. Total return is not computed on an annualized basis.
(5) Total investment return on net asset value is calculated assuming a
purchase at the offering price of $15.000 less the sales load of $0.675 per
share paid by the shareholder on the first day and a sale at the net asset
value on the last day of the period reported. Total investment return on
market value is calculated assuming a purchase at the offering price of
$15.000 less the sales load of $0.675 per share paid by the shareholder on
the first day and a sale at the current market price on the last day of the
period reported. Total investment return on net asset value and total
investment return on market value are not computed on an annualized basis.
(6) Ratios do not reflect the effect of dividend payments to preferred
shareholders. Ratios to average net assets applicable to common shares
reflect the Fund's leveraged capital structure.
(7) Annualized.
(8) Calculated by subtracting the Fund's total liabilities (not including the
preferred shares) from the Fund's total assets, and dividing this by the
number of preferred shares outstanding.
(9) Plus accumulated and unpaid dividends.
See notes to financial statements
44
SELECTED DATA FOR A COMMON SHARE OUTSTANDING DURING THE PERIODS STATED
INSURED CALIFORNIA FUND II
-----------------------------------------------
SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30,
MARCH 31, 2004 ------------------------
(UNAUDITED)(1) 2003(1)(2)
-------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE -- BEGINNING OF PERIOD (COMMON SHARES) $ 14.560 $ 14.325(3)
-------------------------------------------------------------------------------------------------------------------------
INCOME (LOSS) FROM OPERATIONS
Net investment income $ 0.528 $ 0.822
Net realized and unrealized gain 0.494 0.281
Distributions to preferred shareholders
From net investment income (0.034) (0.050)
From net realized gain (0.004) --
-------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME FROM OPERATIONS $ 0.984 $ 1.053
-------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income $ (0.474) $ (0.675)
From net realized gain (0.060) --
-------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO COMMON SHAREHOLDERS $ (0.534) $ (0.675)
-------------------------------------------------------------------------------------------------------------------------
PREFERRED AND COMMON SHARES OFFERING COSTS CHARGED TO PAID-IN CAPITAL $ -- $ (0.054)
-------------------------------------------------------------------------------------------------------------------------
PREFERRED SHARES UNDERWRITING DISCOUNTS $ -- $ (0.089)
-------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE -- END OF PERIOD (COMMON SHARES) $ 15.010 $ 14.560
-------------------------------------------------------------------------------------------------------------------------
MARKET VALUE -- END OF PERIOD (COMMON SHARES) $ 14.960 $ 13.800
-------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT RETURN ON NET ASSET VALUE 6.86%(4) 6.62%(5)
-------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT RETURN ON MARKET VALUE 12.37%(4) 1.06%(5)
-------------------------------------------------------------------------------------------------------------------------
See notes to financial statements
45
SELECTED DATA FOR A COMMON SHARE OUTSTANDING DURING THE PERIODS STATED
INSURED CALIFORNIA FUND II
-----------------------------------------------
SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30,
MARCH 31, 2004 ------------------------
(UNAUDITED)(1) 2003(1)(2)
-------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA+ ++
Net assets applicable to common shares, end of period (000's omitted) $ 57,834 $ 56,083
Ratios (As a percentage of average net assets applicable to common
shares):
Net expenses(6) 1.08%(7) 0.98%(7)
Net expenses after custodian fee reduction(6) 1.07%(7) 0.96%(7)
Net investment income(6) 7.09%(7) 6.75%(7)
Portfolio Turnover 4% 36%
+ The operating expenses of the Fund may reflect a reduction of the
investment adviser fee and/or a reimbursement of expenses by the
Adviser. Had such actions not been taken, the ratios and net
investment income per share would have been as follows:
Ratios (As a percentage of average net assets applicable to common
shares):
Expenses(6) 1.32%(7) 1.22%(7)
Expenses after custodian fee reduction(6) 1.31%(7) 1.20%(7)
Net investment income(6) 6.85%(7) 6.51%(7)
Net investment income per share $ 0.510 $ 0.793
-------------------------------------------------------------------------------------------------------------------------
++ The ratios reported are based on net assets applicable solely to
common shares. The ratios based on net assets, including amounts
related to preferred shares, are as follows:
Ratios (As a percentage of average total net assets):
Net expenses 0.69%(7) 0.64%(7)
Net expenses after custodian fee reduction 0.68%(7) 0.63%(7)
Net investment income 4.47%(7) 4.46%(7)
+ The operating expenses of the Fund may reflect a reduction of the
investment adviser fee and/or a reimbursement of expenses by the
Adviser. Had such actions not been taken, the ratios would have been
as follows:
Ratios (As a percentage of average total net assets):
Expenses 0.84%(7) 0.80%(7)
Expenses after custodian fee reduction 0.83%(7) 0.79%(7)
Net investment income 4.32%(7) 4.30%(7)
-------------------------------------------------------------------------------------------------------------------------
Senior Securities:
Total preferred shares outstanding 1,350 1,350
Asset coverage per preferred share(8) $ 67,840 $ 66,545
Involuntary liquidation preference per preferred share(9) $ 25,000 $ 25,000
Approximate market value per preferred share(9) $ 25,000 $ 25,000
(1) Computed using average shares outstanding.
(2) For the period from the start of business, November 29, 2002, to September
30, 2003.
(3) Net asset value at beginning of period reflects the deduction of the sales
load of $0.675 per share paid by the shareholder from the $15.000 offering
price.
(4) Returns are historical and are calculated by determining the percentage
change in net asset value or maket value with all distributions reinvested.
Total return is not computed on an annualized basis.
(5) Total investment return on net asset value is calculated assuming a
purchase at the offering price of $15.000 less the sales load of $0.675 per
share paid by the shareholder on the first day and a sale at the net asset
value on the last day of the period reported. Total investment return on
market value is calculated assuming a purchase at the offering price of
$15.000 less the sales load of $0.675 per share paid by the shareholder on
the first day and a sale at the current market price on the last day of the
period reported. Total investment return on net asset value and total
investment return on market value are not computed on an annualized basis.
(6) Ratios do not reflect the effect of dividend payments to preferred
shareholders. Ratios to average net assets applicable to common shares
reflect the Fund's leveraged capital structure.
(7) Annualized.
(8) Calculated by subtracting the Fund's total liabilities (not including the
preferred shares) from the Fund's total assets, and dividing this by the
number of preferred shares outstanding.
(9) Plus accumulated and unpaid dividends.
See notes to financial statements
46
SELECTED DATA FOR A COMMON SHARE OUTSTANDING DURING THE PERIODS STATED
INSURED FLORIDA FUND
-----------------------------------------------
SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30,
MARCH 31, 2004 ------------------------
(UNAUDITED)(1) 2003(1)(2)
-------------------------------------------------------------------------------------------------------------------------
Net asset value -- Beginning of period (Common shares) $ 14.550 $ 14.325(3)
-------------------------------------------------------------------------------------------------------------------------
INCOME (LOSS) FROM OPERATIONS
Net investment income $ 0.530 $ 0.788
Net realized and unrealized gain 0.484 0.319
Distributions to preferred shareholders
From net investment income (0.032) (0.060)
From net realized gain (0.007) --
-------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME FROM OPERATIONS $ 0.975 $ 1.047
-------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income $ (0.465) $ (0.675)
From net realized gain (0.080) --
-------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO COMMON SHAREHOLDERS $ (0.545) $ (0.675)
-------------------------------------------------------------------------------------------------------------------------
PREFERRED AND COMMON SHARES OFFERING COSTS CHARGED TO PAID-IN CAPITAL $ -- $ (0.058)
-------------------------------------------------------------------------------------------------------------------------
PREFERRED SHARES UNDERWRITING DISCOUNTS $ -- $ (0.089)
-------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE -- END OF PERIOD (COMMON SHARES) $ 14.980 $ 14.550
-------------------------------------------------------------------------------------------------------------------------
MARKET VALUE -- END OF PERIOD (COMMON SHARES) $ 15.110 $ 14.100
-------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT RETURN ON NET ASSET VALUE 6.83%(4) 6.37%(5)
-------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT RETURN ON MARKET VALUE 11.20%(4) 3.08%(5)
-------------------------------------------------------------------------------------------------------------------------
See notes to financial statements
47
SELECTED DATA FOR A COMMON SHARE OUTSTANDING DURING THE PERIODS STATED
INSURED FLORIDA FUND
-----------------------------------------------
SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30,
MARCH 31, 2004 ------------------------
(UNAUDITED)(1) 2003(1)(2)
-------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA+ ++
Net assets applicable to common shares, end of period (000's omitted) $ 38,348 $ 37,186
Ratios (As a percentage of average net assets applicable to common
shares):
Net expenses(6) 1.13%(7) 1.04%(7)
Net expenses after custodian fee reduction(6) 1.12%(7) 0.98%(7)
Net investment income(6) 7.12%(7) 6.45%(7)
Portfolio Turnover 6% 29%
+ The operating expenses of the Fund may reflect a reduction of the
investment adviser fee and/or a reimbursement of expenses by the
Adviser. Had such actions not been taken, the ratios and net
investment income per share would have been as follows:
Ratios (As a percentage of average net assets applicable to common
shares):
Expenses(6) 1.37%(7) 1.29%(7)
Expenses after custodian fee reduction(6) 1.36%(7) 1.23%(7)
Net investment income(6) 6.88%(7) 6.20%(7)
Net investment income per share $ 0.512 $ 0.757
-------------------------------------------------------------------------------------------------------------------------
++ The ratios reported are based on net assets applicable solely to
common shares. The ratios based on net assets, including amounts
related to preferred shares, are as follows:
Ratios (As a percentage of average total net assets):
Net expenses 0.71%(7) 0.69%(7)
Net expenses after custodian fee reduction 0.70%(7) 0.65%(7)
Net investment income 4.47%(7) 4.25%(7)
+ The operating expenses of the Fund may reflect a reduction of the
investment adviser fee and/or a reimbursement of expenses by the
Adviser. Had such actions not been taken, the ratios would be as
follows:
Ratios (As a percentage of average total net assets):
Expenses 0.86%(7) 0.86%(7)
Expenses after custodian fee reduction 0.85%(7) 0.82%(7)
Net investment income 4.32%(7) 4.08%(7)
-------------------------------------------------------------------------------------------------------------------------
Senior Securities:
Total preferred shares outstanding 900 900
Asset coverage per preferred share(8) $ 67,610 $ 66,319
Involuntary liquidation preference per preferred share(9) $ 25,000 $ 25,000
Approximate market value per preferred share(9) $ 25,000 $ 25,000
(1) Computed using average common shares outstanding.
(2) For the period from the start of business, November 29, 2002, to September
30, 2003.
(3) Net asset value at beginning of period reflects the deduction of the sales
load of $0.675 per share paid by the shareholder from the $15.000 offering
price.
(4) Returns are historical and are calculated by determining the percentage
change in net asset value or market value with all distributions
reinvested. Total return is not computed on an annualized basis.
(5) Total investment return on net asset value is calculated assuming a
purchase at the offering price of $15.000 less the sales load of $0.675 per
share paid by the shareholder on the first day and a sale at the net asset
value on the last day of the period reported. Total investment return on
market value is calculated assuming a purchase at the offering price of
$15.000 less the sales load of $0.675 per share paid by the shareholder on
the first day and a sale at the current market price on the last day of the
period reported. Total investment return on net asset value and total
investment return on market value are not computed on an annualized basis.
(6) Ratios do not reflect the effect of dividend payments to preferred
shareholders. Ratios to average net assets applicable to common shares
reflect the Fund's leveraged capital structure.
(7) Annualized.
(8) Calculated by subtracting the Fund's total liabilities (not including the
preferred shares) from the Fund's total assets, and dividing this by the
number of preferred shares outstanding.
(9) Plus accumulated and unpaid dividends.
See notes to financial statements
48
SELECTED DATA FOR A COMMON SHARE OUTSTANDING DURING THE PERIODS STATED
INSURED MASSACHUSETTS FUND
-----------------------------------------------
SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30,
MARCH 31, 2004 ------------------------
(UNAUDITED)(1) 2003(1)(2)
-------------------------------------------------------------------------------------------------------------------------
Net asset value -- Beginning of period (Common shares) $ 14.670 $ 14.325(3)
-------------------------------------------------------------------------------------------------------------------------
INCOME (LOSS) FROM OPERATIONS
Net investment income $ 0.555 $ 0.823
Net realized and unrealized gain 0.438 0.411
Distributions to preferred shareholders
From net investment income (0.027) (0.058)
From net realized gain (0.017) --
-------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME FROM OPERATIONS $ 0.949 $ 1.176
-------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income $ (0.474) $ (0.675)
From net realized gain (0.225) --
-------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO COMMON SHAREHOLDERS $ (0.699) $ (0.675)
-------------------------------------------------------------------------------------------------------------------------
PREFERRED AND COMMON SHARES OFFERING COSTS CHARGED TO PAID-IN CAPITAL $ -- $ (0.066)
-------------------------------------------------------------------------------------------------------------------------
PREFERRED SHARES UNDERWRITING DISCOUNTS $ -- $ (0.090)
-------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE -- END OF PERIOD (COMMON SHARES) $ 14.920 $ 14.670
-------------------------------------------------------------------------------------------------------------------------
MARKET VALUE -- END OF PERIOD (COMMON SHARES) $ 16.030 $ 14.450
-------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT RETURN ON NET ASSET VALUE 6.56%(4) 7.22%(5)
-------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT RETURN ON MARKET VALUE 16.24%(4) 5.61%(5)
-------------------------------------------------------------------------------------------------------------------------
See notes to financial statements
49
SELECTED DATA FOR A COMMON SHARE OUTSTANDING DURING THE PERIODS STATED
INSURED MASSACHUSETTS FUND
-----------------------------------------------
SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30,
MARCH 31, 2004 ------------------------
(UNAUDITED)(1) 2003(1)(2)
-------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA+ ++
Net assets applicable to common shares, end of period (000's omitted) $ 26,050 $ 25,586
Ratios (As a percentage of average net assets applicable to common
shares):
Net expenses(6) 1.23%(7) 1.10%(7)
Net expenses after custodian fee reduction(6) 1.23%(7) 1.06%(7)
Net investment income(6) 7.45%(7) 6.73%(7)
Portfolio Turnover 14% 81%
+ The operating expenses of the Fund may reflect a reduction of the
investment adviser fee and/or a reimbursement of expenses by the
Adviser. Had such actions not been taken, the ratios and net
investment income per share would have been as follows:
Ratios (As a percentage of average net assets applicable to common
shares):
Expenses(6) 1.47%(7) 1.36%(7)
Expenses after custodian fee reduction(6) 1.47%(7) 1.32%(7)
Net investment income(6) 7.21%(7) 6.47%(7)
Net investment income per share $ 0.537 $ 0.791
-------------------------------------------------------------------------------------------------------------------------
++ The ratios reported are based on net assets applicable solely to
common shares. The ratios based on net assets, including amounts
related to preferred shares, are as follows:
Ratios (As a percentage of average total net assets):
Net expenses 0.77%(7) 0.73%(7)
Net expenses after custodian fee reduction 0.77%(7) 0.70%(7)
Net investment income 4.67%(7) 4.42%(7)
+ The operating expenses of the Fund may reflect a reduction of the
investment adviser fee and/or a reimbursement of expenses by the
Adviser. Had such actions not been taken, the ratios would have been
as follows:
Ratios (As a percentage of average total net assets):
Expenses 0.92%(7) 0.90%(7)
Expenses after custodian fee reduction 0.92%(7) 0.87%(7)
Net investment income 4.52%(7) 4.25%(7)
-------------------------------------------------------------------------------------------------------------------------
Senior Securities:
Total preferred shares outstanding 620 620
Asset coverage per preferred share(8) $ 67,019 $ 66,270
Involuntary liquidation preference per preferred share(9) $ 25,000 $ 25,000
Approximate market value per preferred share(9) $ 25,000 $ 25,000
(1) Computed using average common shares outstanding.
(2) For the period from the start of business, November 29, 2002 to September
30, 2003.
(3) Net asset value at the beginning of period reflects the deduction of the
sales load of $0.675 per share paid by the shareholder from the $15.000
offering price.
(4) Returns are historical and are calculated by determining the percentage
change in net asset value or market value with all distributions
reinvested. Total return is not computed on an annualized basis.
(5) Total investment return on net asset value is calculated assuming a
purchase at the offering price of $15.000 less the sales load of $0.675 per
share paid by the shareholder on the first day and a sale at the net asset
value on the last day of the period reported. Total investment return on
market value is calculated assuming a purchase at the offering price of
$15.000 less the sales load of $0.675 per share paid by the shareholder on
the first day and a sale at the current market price on the last day of the
period reported. Total investment return on net asset value and total
investment return on market value are not computed on an annaulized basis.
(6) Ratios do not reflect the effect of dividend payments to preferred
shareholders. Ratios to average net assets applicable to common shares
reflect the Fund's leveraged capital structure.
(7) Annualized.
(8) Calculated by subtracting the Fund's total liabilities (not including the
preferred shares) from the Fund's total assets, and dividing this by the
number of preferred shares outstanding.
(9) Plus accumulated and unpaid dividends.
See notes to financial statements
50
SELECTED DATA FOR A COMMON SHARE OUTSTANDING DURING THE PERIODS STATED
INSURED MICHIGAN FUND
-----------------------------------------------
SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30,
MARCH 31, 2004 ------------------------
(UNAUDITED)(1) 2003(1)(2)
-------------------------------------------------------------------------------------------------------------------------
Net asset value -- Beginning of period (Common shares) $ 14.520 $ 14.325(3)
-------------------------------------------------------------------------------------------------------------------------
INCOME (LOSS) FROM OPERATIONS
Net investment income $ 0.553 $ 0.824
Net realized and unrealized gain 0.382 0.262
Distribution to preferred shareholders
From net investment income (0.041) (0.058)
-------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME FROM OPERATIONS $ 0.894 $ 1.028
-------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income $ (0.474) $ (0.675)
-------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO COMMON SHAREHOLDERS $ (0.474) $ (0.675)
-------------------------------------------------------------------------------------------------------------------------
PREFERRED AND COMMON SHARES OFFERING COSTS CHARGED TO PAID-IN CAPITAL $ -- $ (0.068)
-------------------------------------------------------------------------------------------------------------------------
PREFERRED SHARES UNDERWRITING DISCOUNTS $ -- $ (0.090)
-------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE -- END OF PERIOD (COMMON SHARES) $ 14.940 $ 14.520
-------------------------------------------------------------------------------------------------------------------------
MARKET VALUE -- END OF PERIOD (COMMON SHARES) $ 16.350 $ 14.410
-------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT RETURN ON NET ASSET VALUE 6.16%(4) 6.12%(5)
-------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT RETURN ON MARKET VALUE 17.06%(4) 5.31%(5)
-------------------------------------------------------------------------------------------------------------------------
See notes to financial statements
51
SELECTED DATA FOR A COMMON SHARE OUTSTANDING DURING THE PERIODS STATED
INSURED MICHIGAN FUND
-----------------------------------------------
SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30,
MARCH 31, 2004 ------------------------
(UNAUDITED)(1) 2003(1)(2)
-------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA+ ++
Net assets applicable to common shares, end of period (000's omitted) $ 22,538 $ 21,893
Ratios (As a percentage of average net assets applicable to common
shares):
Net expenses(6) 1.27%(7) 1.14%(7)
Net expenses after custodian fee reduction(6) 1.27%(7) 1.09%(7)
Net investment income(6) 7.45%(7) 6.75%(7)
Portfolio Turnover 3% 79%
+ The operating expenses of the Fund may reflect a reduction of the
investment adviser fee and/or a reimbursement of expenses by the
Adviser. Had such actions not been taken, the ratios and net
investment income per share would have been as follows:
Ratios (As a percentage of average net assets applicable to common shares):
Expenses(6) 1.51%(7) 1.41%(7)
Expenses after custodian fee reduction(6) 1.51%(7) 1.36%(7)
Net investment income(6) 7.21%(7) 6.48%(7)
Net investment income per share $ 0.535 $ 0.792
-------------------------------------------------------------------------------------------------------------------------
++ The ratios reported are based on net assets applicable solely to
common shares. The ratios based on net assets, including amounts
related to preferred shares, are as follows:
Ratios (As a percentage of average total net assets):
Net expenses 0.79%(7) 0.75%(7)
Net expenses after custodian fee reduction 0.79%(7) 0.71%(7)
Net investment income 4.65%(7) 4.42%(7)
+ The operating expenses of the Fund may reflect a reduction of the
investment adviser fee and/or a reimbursement of expenses by the
Adviser. Had such actions not been taken, the ratios would have been
as follows:
Ratios (As a percentage of average total net assets):
Expenses 0.94%(7) 0.93%(7)
Expenses after custodian fee reduction 0.94%(7) 0.89%(7)
Net investment income 4.50%(7) 4.25%(7)
-------------------------------------------------------------------------------------------------------------------------
Senior Securities:
Total preferred shares outstanding 540 540
Asset coverage per preferred share(8) $ 66,738 $ 65,543
Involuntary liquidation preference per preferred share(9) $ 25,000 $ 25,000
Approximate market value per preferred share(9) $ 25,000 $ 25,000
(1) Computed using average common shares outstanding.
(2) For the period from the start of business, November 29, 2002, to September
30, 2003.
(3) Net asset value at beginning of period reflects the deduction of the sales
load of $0.675 per share paid by the shareholder from the $15.000 offering
price.
(4) Returns are historical and are calculated by determining the percentage
change in net asset value or market value with all distributions
reinvested. Total return is not computed on an annualized basis.
(5) Total investment return on net asset value is calculated assuming a
purchase at the offering of $15.000 less the sales load of $0.675 per share
paid by the shareholder on the first day and a sale at the net asset value
on the last day of the period reported. Total investment return on market
value is calculated assuming a purchase at the offering price of $15.000
less the sales load of $0.675 per share paid by the shareholder on the
first day and a sale at the current market price on the last day of the
period reported. Total investment return on net asset value and total
investment return on market value are not computed on an annualized basis.
(6) Ratios do not reflect the effect of dividend payments to preferred
shareholders. Ratios to average net assets applicable to common shares
reflect the Fund's leveraged capital structure.
(7) Annualized.
(8) Calculated by subtracting the Fund's total liabilities (not including the
preferred shares) from the Fund's total assets, and dividing this number by
the number of preferred shares outstanding.
(9) Plus accumulated and unpaid dividends.
See notes to financial statements
52
SELECTED DATA FOR A COMMON SHARE OUTSTANDING DURING THE PERIODS STATED
INSURED NEW JERSEY FUND
-----------------------------------------------
SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30,
MARCH 31, 2004 ------------------------
(UNAUDITED)(1) 2003(1)(2)
-------------------------------------------------------------------------------------------------------------------------
Net asset value -- Beginning of period (Common shares) $ 14.760 $ 14.325(3)
-------------------------------------------------------------------------------------------------------------------------
INCOME (LOSS) FROM OPERATIONS
Net investment income $ 0.559 $ 0.826
Net realized and unrealized gain 0.678 0.489
Distribution to preferred shareholders
From net investment income (0.026) (0.058)
From net realized gain (0.015)
-------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME FROM OPERATIONS $ 1.196 $ 1.257
-------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income $ (0.480) $ (0.675)
From net realized gain (0.206) --
-------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO COMMON SHAREHOLDERS $ (0.686) $ (0.675)
-------------------------------------------------------------------------------------------------------------------------
PREFERRED AND COMMON SHARES OFFERING COSTS CHARGED TO PAID-IN CAPITAL $ -- $ (0.058)
-------------------------------------------------------------------------------------------------------------------------
PREFERRED SHARES UNDERWRITING DISCOUNTS $ -- $ (0.089)
-------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE -- END OF PERIOD (COMMON SHARES) $ 15.270 $ 14.760
-------------------------------------------------------------------------------------------------------------------------
MARKET VALUE -- END OF PERIOD (COMMON SHARES) $ 15.910 $ 14.520
-------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT RETURN ON NET ASSET VALUE 8.24%(4) 7.89%(5)
-------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT RETURN ON MARKET VALUE 14.64%(4) 6.14%(5)
-------------------------------------------------------------------------------------------------------------------------
See notes to financial statements
53
SELECTED DATA FOR A COMMON SHARE OUTSTANDING DURING THE PERIODS STATED
INSURED NEW JERSEY FUND
-----------------------------------------------
SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30,
MARCH 31, 2004 ------------------------
(UNAUDITED)(1) 2003(1)(2)
-------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA+ ++
Net assets applicable to common shares, end of period (000's omitted) $ 39,032 $ 37,687
Ratios (As a percentage of average net assets applicable to common
shares):
Net expenses(6) 1.10%(7) 1.03%(7)
Net expenses after custodian fee reduction(6) 1.10%(7) 0.99%(7)
Net investment income(6) 7.39%(7) 6.69%(7)
Portfolio Turnover 5% 68%
+ The operating expenses of the Fund may reflect a reduction of the
investment adviser fee and/or a reimbursement of expenses by the
Adviser. Had such actions not been taken, the ratios and net
investment income per share would have been as follows:
Ratios (As a percentage of average net assets applicable to common
shares):
Expenses(6) 1.34%(7) 1.28%(7)
Expenses after custodian fee reduction(6) 1.34%(7) 1.24%(7)
Net investment income(6) 7.15%(7) 6.44%(7)
Net investment income per share $ 0.541 $ 0.795
-------------------------------------------------------------------------------------------------------------------------
++ The ratios reported are based on net assets applicable solely to
common shares. The ratios based on net assets, including amounts
related to preferred shares, are as follows:
Ratios (As a percentage of average total net assets):
Net expenses 0.70%(7) 0.69%(7)
Net expenses after custodian fee reduction 0.70%(7) 0.66%(7)
Net investment income 4.67%(7) 4.43%(7)
+ The operating expenses of the Fund may reflect a reduction of the
investment adviser fee and/or a reimbursement of expenses by the
Adviser. Had such actions not been taken, the ratios would have been
as follows:
Ratios (As a percentage of average total net assets):
Expenses 0.85%(7) 0.85%(7)
Expenses after custodian fee reduction 0.85%(7) 0.82%(7)
Net investment income 4.52%(7) 4.26%(7)
-------------------------------------------------------------------------------------------------------------------------
Senior Securities:
Total preferred shares outstanding 900 900
Asset coverage per preferred share(8) $ 68,370 $ 66,875
Involuntary liquidation preference per preferred share(9) $ 25,000 $ 25,000
Approximate market value per preferred share(9) $ 25,000 $ 25,000
(1) Computed using average common shares outstanding.
(2) For the period from the start of business, November 29, 2002, to September
30, 2003.
(3) Net asset value at beginning of period reflects the deduction of the sales
load of $0.675 per share paid by the shareholder from the $15.000 offering
price.
(4) Returns are historical and are calculated by determining the percentage
change in net asset value or market value with all distributions
reinvested. Total return is not computed on an annualized basis.
(5) Total investment return on net asset value is calculated assuming a
purchase at the offering price of $15.000 less the sales load of $0.675 per
share paid by the shareholder on the first day and a sale at the net asset
value on the last day of the period reported. Total investment return on
market value is calculated assuming a purchase at the offering price of
$15.000 less the sales load of $0.675 per share paid by the shareholder on
the first day and a sale at the current market price on the last day of the
period reported. Total investment return on net asset value and total
investment return on market value are not computed on an annualized basis.
(6) Ratios do not reflect the effect of dividend payments to preferred
shareholders. Ratios to average net assets applicable to common shares
reflect the Fund's leveraged capital structure.
(7) Annualized.
(8) Calculated by subtracting the Fund's total liabilities (not including the
preferred shares) from the Fund's total assets, and dividing this by the
number or preferred shares outstanding.
(9) Plus accumulated and unpaid dividends
See notes to financial statements
54
SELECTED DATA FOR A COMMON SHARE OUTSTANDING DURING THE PERIODS STATED
INSURED NEW YORK FUND II
-----------------------------------------------
SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30,
MARCH 31, 2004 ------------------------
(UNAUDITED)(1) 2003(1)(2)
-------------------------------------------------------------------------------------------------------------------------
Net asset value -- Beginning of period (Common shares) $ 14.870 $ 14.325(3)
-------------------------------------------------------------------------------------------------------------------------
INCOME (LOSS) FROM OPERATIONS
Net investment income $ 0.536 $ 0.818
Net realized and unrealized gain 0.415 0.617
Distributions to preferred shareholders
From net investment income (0.022) (0.057)
From net realized gain (0.016) --
-------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME FROM OPERATIONS $ 0.913 $ 1.378
-------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income $ (0.482) $ (0.686)
From net realized gain (0.221) --
-------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO COMMON SHAREHOLDERS $ (0.703) $ (0.686)
-------------------------------------------------------------------------------------------------------------------------
PREFERRED AND COMMON SHARES OFFERING COSTS CHARGED TO PAID-IN CAPITAL $ -- $ (0.058)
-------------------------------------------------------------------------------------------------------------------------
PREFERRED SHARES UNDERWRITING DISCOUNTS $ -- $ (0.089)
-------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE -- END OF PERIOD (COMMON SHARES) $ 15.080 $ 14.870
-------------------------------------------------------------------------------------------------------------------------
MARKET VALUE -- END OF PERIOD (COMMON SHARES) $ 15.270 $ 13.710
-------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT RETURN ON NET ASSET VALUE 6.30%(4)(10) 8.87%(5)
-------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT RETURN ON MARKET VALUE 16.75%(4)(10) 0.38%(5)
-------------------------------------------------------------------------------------------------------------------------
See notes to financial statements
55
SELECTED DATA FOR A COMMON SHARE OUTSTANDING DURING THE PERIODS STATED
INSURED NEW YORK FUND II
-----------------------------------------------
SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30,
MARCH 31, 2004 ------------------------
(UNAUDITED)(1) 2003(1)(2)
-------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA+ ++
Net assets applicable to common shares, end of period (000's omitted) $ 38,513 $ 37,984
Ratios (As a percentage of average net assets applicable to common
shares):
Net expenses(6) 1.17%(7) 1.03%(7)
Net expenses after custodian fee reduction(6) 1.17%(7) 0.98%(7)
Net investment income(6) 7.11%(7) 6.65%(7)
Portfolio Turnover 7% 66%
+ The operating expenses of the Fund may reflect a reduction of the
investment adviser fee and/or a reimbursement of expenses by the
Adviser. Had such actions not been taken, the ratios and net
investment income per share would have been as follows:
Ratios (As a percentage of average net assets applicable to common
shares):
Expenses(6) 1.41%(7) 1.28%(7)
Expenses after custodian fee reduction(6) 1.41%(7) 1.23%(7)
Net investment income(6) 6.87%(7) 6.40%(7)
Net investment income per share $ 0.518 $ 0.787
-------------------------------------------------------------------------------------------------------------------------
++ The ratios reported are based on net assets applicable solely to
common shares. The ratios based on net assets, including amounts
related to preferred shares, are as follows:
Ratios (As a percentage of average total net assets):
Net expenses 0.74%(7) 0.68%(7)
Net expenses after custodian fee reduction 0.74%(7) 0.65%(7)
Net investment income 4.49%(7) 4.40%(7)
+ The operating expenses of the Fund may reflect a reduction of the
investment adviser fee and/or a reimbursement of expenses by the
Adviser. Had such actions not been taken, the ratios would be as
follows:
Ratios (As a percentage of average total net assets):
Expenses 0.89%(7) 0.85%(7)
Expenses after custodian fee reduction 0.89%(7) 0.82%(7)
Net investment income 4.34%(7) 4.23%(7)
-------------------------------------------------------------------------------------------------------------------------
Senior Securities:
Total preferred shares outstanding 900 900
Asset coverage per preferred share(8) $ 67,793 $ 67,209
Involuntary liquidation preference per preferred share(9) $ 25,000 $ 25,000
Approximate market value per preferred share(9) $ 25,000 $ 25,000
(1) Computed using average common shares outstanding.
(2) For the period from the start of business, November 29, 2002, to September
30, 2003.
(3) Net asset value at beginning of period reflects the deduction of the sales
load of $0.675 per share paid by the shareholder from the $15.000 offering
price.
(4) Returns are historical and are calculated by determining the percentage
change in net asset value or market value with all distributions
reinvested. Total return is not computed on an annualized basis.
(5) Total investment return on net asset value is calculated assuming a
purchase at the offering price of $15.000 less the sales load of $0.675 per
share paid by the shareholder on the first day and a sale at the net asset
value on the last day of the period reported. Total investment return on
market value is calculated assuming a purchase at the offering price of
$15.000 less the sales load of $0.675 per share paid by the shareholder on
the first day and a sale at the current market price on the last day of the
period reported. Total investment return on net asset value and total
investment return on market value are not computed on an annualized basis.
(6) Ratios do not reflect the effect of dividend payments to preferred
shareholders. Ratios to average net assets applicable to common shares
reflect the Fund's leveraged capital structure.
(7) Annualized.
(8) Calculated by subtracting the Fund's total liabilities (not including the
preferred shares) from the Fund's total assets, and dividing this by the
number of preferred shares outstanding.
(9) Plus accumulated and unpaid dividends.
(10) During the six months ended March 31, 2004, the investment adviser
reimbursed the Fund for a net loss realized on the disposal of an
investment in violation of restrictions. This reimbursement was less than
$0.01 per common share and had no effect on total investment return on net
asset value and total investment return on market value for the six months
ended March 31, 2004.
See notes to financial statements
56
SELECTED DATA FOR A COMMON SHARE OUTSTANDING DURING THE PERIODS STATED
INSURED OHIO FUND
-----------------------------------------------
SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30,
MARCH 31, 2004 ------------------------
(UNAUDITED)(1) 2003(1)(2)
-------------------------------------------------------------------------------------------------------------------------
Net asset value -- Beginning of period (Common shares) $ 14.620 $ 14.325(3)
-------------------------------------------------------------------------------------------------------------------------
INCOME (LOSS) FROM OPERATIONS
Net investment income $ 0.527 $ 0.776
Net realized and unrealized gain 0.042 0.402
Distributions to preferred shareholders
From net investment income (0.038) (0.060)
From net realized gain (0.003) --
-------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME FROM OPERATIONS $ 0.528 $ 1.118
-------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income $ (0.465) $ (0.675)
From net realized gain (0.033) --
-------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO COMMON SHAREHOLDERS $ (0.498) $ (0.675)
-------------------------------------------------------------------------------------------------------------------------
PREFERRED AND COMMON SHARES OFFERING COSTS CHARGED TO PAID-IN CAPITAL $ -- $ (0.060)
-------------------------------------------------------------------------------------------------------------------------
PREFERRED SHARES UNDERWRITING DISCOUNTS $ -- $ (0.088)
-------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE -- END OF PERIOD (COMMON SHARES) $ 14.650 $ 14.620
-------------------------------------------------------------------------------------------------------------------------
MARKET VALUE -- END OF PERIOD (COMMON SHARES) $ 15.760 $ 14.430
-------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT RETURN ON NET ASSET VALUE 3.57%(4) 6.85%(5)
-------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT RETURN ON MARKET VALUE 12.88%(4) 5.46%(5)
-------------------------------------------------------------------------------------------------------------------------
See notes to financial statements
57
SELECTED DATA FOR A COMMON SHARE OUTSTANDING DURING THE PERIODS STATED
INSURED OHIO FUND
-----------------------------------------------
SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30,
MARCH 31, 2004 ------------------------
(UNAUDITED)(1) 2003(1)(2)
-------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA+ ++
Net assets applicable to common shares, end of period (000's omitted) $ 36,715 $ 36,610
Ratios (As a percentage of average net assets applicable to common
shares):
Net expenses(6) 1.15%(7) 1.05%(7)
Net expenses after custodian fee reduction(6) 1.15%(7) 0.99%(7)
Net investment income(6) 7.17%(7) 6.38%(7)
Portfolio Turnover 4% 32%
+ The operating expenses of the Fund may reflect a reduction of the
investment adviser fee and/or a reimbursement of expenses by the
Adviser. Had such actions not been taken, the ratios and net
investment income per share would have been as follows:
Ratios (As a percentage of average net assets applicable to common
shares):
Expenses(6) 1.39%(7) 1.30%(7)
Expenses after custodian fee reduction(6) 1.39%(7) 1.24%(7)
Net investment income(6) 6.93%(7) 6.13%(7)
Net investment income per share $ 0.509 $ 0.746
-------------------------------------------------------------------------------------------------------------------------
++ The ratios reported are based on net assets applicable solely to
common shares. The ratios based on net assets, including amounts
related to preferred shares, are as follows:
Ratios (As a percentage of average total net assets):
Net expenses 0.72%(7) 0.69%(7)
Net expenses after custodian fee reduction 0.72%(7) 0.65%(7)
Net investment income 4.50%(7) 4.21%(7)
+ The operating expenses of the Fund may reflect a reduction of the
investment adviser fee and/or a reimbursement of expenses by the
Adviser. Had such actions not been taken, the ratios would have been
as follows:
Ratios (As a percentage of average total net assets):
Expenses 0.87%(7) 0.86%(7)
Expenses after custodian fee reduction 0.87%(7) 0.82%(7)
Net investment income 4.35%(7) 4.04%(7)
-------------------------------------------------------------------------------------------------------------------------
Senior Securities:
Total preferred shares outstanding 875 875
Asset coverage per preferred share(8) $ 66,962 $ 66,841
Involuntary liquidation preference per preferred share(9) $ 25,000 $ 25,000
Approximate market value per preferred share(9) $ 25,000 $ 25,000
(1) Computed using average common shares outstanding.
(2) For the period from the start of business, November 29, 2002, to September
30, 2003.
(3) Net asset value at beginning of period reflects the deduction of the sales
load of $0.675 per share paid by the shareholder from the $15.000 offering
price.
(4) Returns are historical and are calculated by determining the percentage
change in net asset value or maket value with all distributions reinvested.
Total return is not computed on an annualized basis.
(5) Total investment return on net asset value is calculated assuming a
purchase at the offering price of $15.000 less the sales load of $0.675 per
share paid by the shareholder on the first day and a sale at the net asset
value on the last day of the period reported. Total investment return on
net asset value is calculated assuming a purchase at the offering price of
$15.000 less the sales load of $0.675 per share paid by the shareholder on
the first day and a sale at the current maket price on the last day of the
period reported. Total investment return on net asset value and total
investment return on market value are not computed on an annualized basis.
(6) Ratios do not reflect the effect of dividend payments to preferred
shareholders. Ratios to average net assets applicable to common shares
reflect the Fund's leveraged capital structure.
(7) Annualized.
(8) Calculated by subtracting the Fund's total liabilities (not including the
preferred shares) from the Fund's total assets, and dividing this by the
number of preferred shares outstanding.
(9) Plus accumulated and unpaid dividends.
See notes to financial statements
58
SELECTED DATA FOR A COMMON SHARE OUTSTANDING DURING THE PERIODS STATED
INSURED PENNSYLVANIA FUND
-----------------------------------------------
SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30,
MARCH 31, 2004 ------------------------
(UNAUDITED)(1) 2003(1)(2)
-------------------------------------------------------------------------------------------------------------------------
Net asset value -- Beginning of period (Common shares) $ 14.580 $ 14.325(3)
-------------------------------------------------------------------------------------------------------------------------
INCOME (LOSS) FROM OPERATIONS
Net investment income $ 0.529 $ 0.811
Net realized and unrealized gain 0.465 0.331
Distributions to preferred shareholders
From net investment income (0.034) (0.060)
From net realized gain (0.011) --
-------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME FROM OPERATIONS $ 0.949 $ 1.082
-------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income $ (0.469) $ (0.681)
From net realized gain (0.140)
-------------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO COMMON SHAREHOLDERS $ (0.609) $ (0.681)
-------------------------------------------------------------------------------------------------------------------------
PREFERRED AND COMMON SHARES OFFERING COSTS CHARGED TO PAID-IN CAPITAL $ -- $ (0.056)
-------------------------------------------------------------------------------------------------------------------------
PREFERRED SHARES UNDERWRITING DISCOUNTS $ -- $ (0.090)
-------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE -- END OF PERIOD (COMMON SHARES) $ 14.920 $ 14.580
-------------------------------------------------------------------------------------------------------------------------
MARKET VALUE -- END OF PERIOD (COMMON SHARES) $ 16.060 $ 14.330
-------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT RETURN ON NET ASSET VALUE 6.55%(4) 6.63%(5)
-------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT RETURN ON MARKET VALUE 16.69%(4) 4.80%(5)
-------------------------------------------------------------------------------------------------------------------------
See notes to financial statements
59
SELECTED DATA FOR A COMMON SHARE OUTSTANDING DURING THE PERIODS STATED
INSURED PENNSYLVANIA FUND
-----------------------------------------------
SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30,
MARCH 31, 2004 ------------------------
(UNAUDITED)(1) 2003(1)(2)
-------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA+ ++
Net assets applicable to common shares, end of period (000's omitted) $ 43,841 $ 42,822
Ratios (As a percentage of average net assets applicable to common
shares):
Net expenses(6) 1.11%(7) 1.03%(7)
Net expenses after custodian fee reduction(6) 1.11%(7) 0.97%(7)
Net investment income(6) 7.14%(7) 6.64%(7)
Portfolio Turnover 5% 34%
+ The operating expenses of the Fund may reflect a reduction of the
investment adviser fee and/or a reimbursement of expenses by the
Adviser. Had such actions not been taken, the ratios and net
investment income per share would have been as follows:
Ratios (As a percentage of average net assets applicable to common
shares):
Expenses(6) 1.35%(7) 1.28%(7)
Expenses after custodian fee reduction(6) 1.35%(7) 1.22%(7)
Net investment income(6) 6.90%(7) 6.39%(7)
Net investment income per share $ 0.512 $ 0.780
-------------------------------------------------------------------------------------------------------------------------
++ The ratios reported are based on net assets applicable solely to
common shares. The ratios based on net assets, including amounts
related to preferred shares, are as follows:
Ratios (As a percentage of average total net assets):
Net expenses 0.69%(7) 0.68%(7)
Net expenses after custodian fee reduction 0.69%(7) 0.64%(7)
Net investment income 4.47%(7) 4.37%(7)
+ The operating expenses of the Fund may reflect a reduction of the
investment adviser fee and/or a reimbursement of expenses by the
Adviser. Had such actions not been taken, the ratios would have been
as follows:
Ratios (As a percentage of average total net assets):
Expenses 0.84%(7) 0.84%(7)
Expenses after custodian fee reduction 0.84%(7) 0.80%(7)
Net investment income 4.32%(7) 4.20%(7)
-------------------------------------------------------------------------------------------------------------------------
Senior Securities:
Total preferred shares outstanding 1,040 1,040
Asset coverage per preferred share(8) $ 67,159 $ 66,178
Involuntary liquidation preference per preferred share(9) $ 25,000 $ 25,000
Approximate market value per preferred share(9) $ 25,000 $ 25,000
(1) Computed using average common shares outstanding.
(2) For the period from the start of business, November 29, 2002, to
September 30, 2003.
(3) Net asset value at beginning of period reflects the deduction of the
sales load of $0.675 per share paid by the shareholder from the
$15.000 offering price.
(4) Returns are historical and are calculated by determining the
percentage change in net asset value or market value with all
distributions reinvested. Total return is not computed on an
annualized basis.
(5) Total investment return on net asset value is calculated assuming a
purchase at the offering price of $15.000 less the sales load of
$0.675 per share paid by the shareholder on the first day and sale
at the net asset value on the last day of the period reported. Total
investment return on market value is calculated assuming a purchase
at the offering price of $15.000 less the sales load of $0.675 per
share paid by the shareholder on the first day and a sale at the
current market price on the last day of the period reported. Total
investment return on net asset value and total investment return on
market value are not computed on an annualized basis.
(6) Ratios do not reflect the effect of dividend payments to preferred
shareholders. Ratios to average net assets applicable to common
shares reflect the Fund's leveraged capital structure.
(7) Annualized.
(8) Calculated by subtracting the Fund's total liabilities (not
including the preferred shares) from the Fund's total assets, and
dividing this by the number of preferred shares outstanding.
(9) Plus accumulated and unpaid dividends.
See notes to financial statements
60
EATON VANCE INSURED MUNICIPAL BOND FUNDS as of March 31, 2004
NOTES TO FINANCIAL STATEMENTS (Unaudited)
1 SIGNIFICANT ACCOUNTING POLICIES
Eaton Vance Insured Municipal Bond Fund II (Insured Municipal Fund II), Eaton
Vance Insured California Municipal Bond Fund II (Insured California Fund II),
Eaton Vance Insured Florida Municipal Bond Fund (Insured Florida Fund), Eaton
Vance Insured Massachusetts Municipal Bond Fund (Insured Massachusetts Fund),
Eaton Vance Insured Michigan Municipal Bond Fund (Insured Michigan Fund),
Eaton Vance Insured New Jersey Municipal Bond Fund (Insured New Jersey Fund),
Eaton Vance Insured New York Municipal Bond Fund II (Insured New York Fund
II), Eaton Vance Insured Ohio Municipal Bond Fund (Insured Ohio Fund), and
Eaton Vance Insured Pennsylvania Municipal Bond Fund (Insured Pennsylvania
Fund) (individually referred to as the Fund or collectively the Funds) are
registered under the Investment Company Act of 1940, as amended, as
non-diversified, closed-end management investment companies. Each of the
Funds was organized under the laws of the Commonwealth of Massachusetts by an
Agreement and Declaration of Trust dated October 3, 2002. Each Fund's
investment objective is to achieve current income exempt from regular federal
income tax, including alternative minimum tax, and taxes in its specified
state. Each Fund seeks to achieve its objective by investing primarily in
high grade municipal obligations that are insured as to the timely payment of
principal and interest.
The following is a summary of significant accounting policies consistently
followed by each Fund in the preparation of its financial statements. The
policies are in conformity with accounting principles generally accepted in
the United States of America.
A INVESTMENT VALUATION -- Municipal bonds are normally valued on the basis of
valuations furnished by a pricing service. Exchange-traded options are valued
at the last sale price for the day of valuation as quoted on the principal
exchange or board of trade on which the options are traded or, in the absence
of sales on such date, at the mean between the latest bid and asked prices
therefore. Futures contracts listed on the commodity exchanges are valued at
closing settlement prices. Interest rate swaps are normally valued on the
basis of valuations furnished by a broker. Short-term obligations, maturing
in sixty days or less, are valued at amortized cost, which approximates
value. Investments for which valuations or market quotations are unavailable
are valued at fair value using methods determined in good faith by or at the
direction of the Trustees.
B INVESTMENT TRANSACTIONS -- Investment transactions are recorded on a trade
date basis. Realized gains and losses from such transactions are determined
using the specific identification method. Securities purchased or sold on a
when-issued or delayed delivery basis may be settled a month or more after
the transaction date. The securities so purchased are subject to market
fluctuations during this period. To the extent that when-issued or delayed
delivery purchases are outstanding, the Fund instructs the custodian to
segregate assets in a separate account, with a current value at least equal
to the amount of its purchase commitments.
C INCOME -- Interest income is determined on the basis of interest accrued,
adjusted for amortization of premium or discount.
D FEDERAL TAXES -- Each Fund's policy is to comply with the provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute to shareholders each year all of its taxable, if any, and
tax-exempt income, including any net realized gain on investments. Therefore,
no provision for federal income or excise tax is necessary.
In addition, each Fund intends to satisfy conditions which will enable it to
designate distributions from the interest income generated by its investments
in municipal obligations, which are exempt from regular federal income taxes
when received by each Fund, as exempt-interest dividends.
Additionally, at September 30, 2003, Insured Municipal Fund II, Insured
California Fund II, Insured Florida Fund, Insured Michigan Fund and Insured
Pennsylvania Fund had net capital losses of $622,940, $175,668, $74,414,
$271,775, and $61,966 respectively, attributable to security transactions
incurred after October 31, 2002. These are treated as arising on the first
day of each Fund's taxable year ending September 30, 2004.
E ORGANIZATION AND OFFERING COSTS -- Costs incurred by each Fund in
connection with its organization have been expensed. Costs incurred by each
Fund in connection with the offerings of the common shares and preferred
shares were recorded as a reduction of capital paid in excess of par
applicable to common shares.
F FINANCIAL FUTURES CONTRACTS -- Upon the entering of a financial futures
contract, a Fund is required to deposit (initial margin) either in cash or
securities an amount equal to
61
a certain percentage of the purchase price indicated in the financial futures
contract. Subsequent payments are made or received by a Fund (margin
maintenance) each day, dependent on the daily fluctuations in the value of
the underlying security, and are recorded for book purposes as unrealized
gains or losses by a Fund. A Fund's investment in financial futures contracts
is designed for both hedging against anticipated future changes in interest
rates and investment purposes. Should interest rates move unexpectedly, a
Fund may not achieve the anticipated benefits of the financial futures
contracts and may realize a loss.
G OPTIONS ON FINANCIAL FUTURES CONTRACTS -- Upon the purchase of a put option
on a financial futures contract by a Fund, the premium paid is recorded as an
investment, the value of which is marked-to-market daily. When a purchased
option expires, a Fund will realize a loss in the amount of the cost of the
option. When a Fund enters into a closing sale transaction, a Fund will
realize a gain or loss depending on whether the sales proceeds from the
closing sale transaction are greater or less than the cost of the option.
When a Fund exercises a put option, settlement is made in cash. The risk
associated with purchasing put options is limited to the premium originally
paid.
H USE OF ESTIMATES -- The preparation of the financial statements in
conformity with accounting principles generally accepted in the United States
of America 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 reported amounts of income and expense during the
reporting period. Actual results could differ from those estimates.
I INDEMNIFICATIONS -- Under each Fund's organizational documents, its
officers and Trustees may be indemnified against certain liabilities and
expenses arising out of the performance of their duties to each Fund and
shareholders are indemnified against personal liability for the obligations
of each Fund. Additionally, in the normal course of business, each Fund
enters into agreements with service providers that may contain
indemnification clauses. Each Fund's maximum exposure under these
arrangements is unknown as this would involve future claims that may be made
against each Fund that have not yet occurred.
J EXPENSE REDUCTION -- Investors Bank & Trust Company (IBT) serves as
custodian of the Funds. Pursuant to the respective custodian agreements, IBT
receives a fee reduced by credits which are determined based on the average
daily cash balances each Fund maintains with IBT. All significant credit
balances used to reduce the Funds' custodian fees are reported as a reduction
of total expenses in the Statement of Operations.
K INTERIM FINANCIAL STATEMENTS -- The interim financial statements relating
to March 31, 2004 and for the six months then ended have not been audited by
independent certified public accountants, but in the opinion of the Funds'
management reflect all adjustments, consisting only of normal recurring
adjustments, necessary for the fair presentation of the financial statements.
2 AUCTION PREFERRED SHARES (APS)
Each Fund issued Auction Preferred Shares on January 15, 2003 in a public
offering. The underwriting discounts and other offering costs were recorded
as a reduction of capital of the common shares of each Fund. Dividends on the
APS, which accrue daily, are cumulative at a rate which was established at
the offering of each Fund's APS and have been reset every seven days
thereafter by an auction. Initially, the Insured Municipal Fund II elected an
Initial Dividend Period for Series B of 360 days. Series A and Series B are
identical in all respects except for the dates of reset for the dividend
rates. Auction Preferred Shares issued and outstanding as of March 31, 2004
and dividend rate ranges for the six months ended March 31, 2004 are as
indicated below:
PREFERRED SHARES DIVIDENDS RATE
FUND ISSUED AND OUTSTANDING RANGES
---------------------------------------------------------------------------
Insured Municipal II Series A 1,750 0.45% - 1.75%
Insured Municipal II Series B 1,750 1.06% - 1.35%
Insured California II 1,350 0.40% - 1.50%
Insured Florida 900 0.45% - 1.19%
Insured Massachusetts 620 0.45% - 1.75%
Insured Michigan 540 0.60% - 1.20%
Insured New Jersey 900 0.40% - 2.00%
Insured New York II 900 0.45% - 1.25%
Insured Ohio 875 0.75% - 1.75%
Insured Pennsylvania 1,040 0.82% - 1.15%
The APS are redeemable at the option of each Fund at a redemption price equal
to $25,000 per share, plus accumulated and unpaid dividends on any dividend
payment date. The APS are also subject to mandatory redemption at a
redemption price equal to $25,000 per share, plus accumulated and unpaid
dividends, if any Fund is in default for an extended period on its asset
maintenance requirements with respect to the APS. If the dividends on the APS
shall remain unpaid in an amount equal to two full years' dividends, the
holders of the APS as a class have the right to elect a majority of the Board
of Trustees. In general, the holders of the APS and the
62
Common Shares have equal voting rights of one vote per share, except that the
holders of the APS, as a separate class, have the right to elect at least two
members of the Board of Trustees. The APS have a liquidation preference of
$25,000 per share, plus accumulated and unpaid dividends. Each Fund is
required to maintain certain asset coverage with respect to the APS as
defined in each Trust's By-Laws and the Investment Company Act of 1940. Each
Fund pays an annual fee equivalent to 0.25% of the preferred shares
liquidation value for the remarketing efforts associated with the preferred
auction.
3 DISTRIBUTIONS TO SHAREHOLDERS
Each Fund intends to make monthly distributions of net investment income,
after payments of any dividends on any outstanding APS. Distributions are
recorded on the ex-dividend date. Distributions of realized capital gains, if
any, are made at least annually. Distributions to preferred shareholders are
recorded daily and are payable at the end of each dividend period. Each
dividend payment period for the APS is generally seven days. Effective
January 9, 2004, the Series B shares of the Insured Municipal Fund II set a
special dividend period of 366 days. The Insured Municipal Fund II Series B
pays accumulated dividends on the first business day of each month. Final
payment will be made on January 10, 2005. The applicable dividend rate for
Auction Preferred Shares on March 31, 2004 are listed below. For the six
months ended March 31, 2004, the amount of dividends each Fund paid to
Auction Preferred shareholders and average APS dividend rates for such period
were as follows:
DIVIDENDS PAID
TO PREFERRED
SHAREHOLDERS
FROM NET
INVESTMENT INCOME AVERAGE APS
APS AND NET REALIZED DIVIDEND RATES
DIVIDEND RATES GAIN FOR THE FOR THE SIX MONTHS
AS OF SIX MONTHS ENDED ENDED
FUND MARCH 31, 2004 MARCH 31, 2004 MARCH 31, 2004
------------------------------------------------------------------------------------
Insured Municipal II
Series A 0.90% 260,452 0.93%
Insured Municipal II
Series B 1.06% 254,239 1.27%
Insured California II 0.45% 144,920 0.85%
Insured Florida 0.90% 99,591 0.88%
Insured Massachusetts 0.73% 76,075 0.98%
Insured Michigan 0.90% 61,258 0.90%
Insured New Jersey 0.90% 105,041 0.93%
Insured New York II 0.94% 97,756 0.87%
Insured Ohio 0.95% 102,816 0.94%
Insured Pennsylvania 0.90% 132,698 0.93%
The Funds distinguish between distributions on a tax basis and a financial
reporting basis. Accounting principles generally accepted in the United
States of America require that only distributions in excess of tax basis
earnings and profits be reported in the financial statements as a return of
capital. Permanent differences between book and tax accounting relating to
distributions are reclassified to paid in capital. These differences relate
primarily to the method for amortizing premiums.
4 INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES
The investment adviser fee, computed at an annual rate of 0.55% of each
Fund's average weekly gross assets, was earned by Eaton Vance Management
(EVM) as compensation for investment advisory services rendered to each Fund.
Except for Trustees of each Fund who are not members of EVM's organization,
officers and Trustees receive remuneration for their services to each Fund
out of such investment adviser fee. For the six months ended March 31, 2004,
the fee was equivalent to 0.55% (annualized) of each Fund's average weekly
gross assets and amounted to $646,256, $250,523, $166,535, $114,120, $98,628,
$168,107, $167,735, $161,392 and $191,348 for Insured Municipal Fund II,
Insured California Fund II, Insured Florida Fund, Insured Massachusetts Fund,
Insured Michigan Fund, Insured New Jersey Fund, Insured New York Fund II,
Insured Ohio Fund and Insured Pennsylvania Fund, respectively. EVM also
serves as the administrator of the Funds, but currently receives no
compensation.
In addition, EVM has contractually agreed to reimburse the Fund for fees and
other expenses in the amount of 0.15% of average weekly total assets of each
Fund during the first five full years of each Fund's operations, 0.10% of
average weekly total assets of each Fund in year six, and 0.05% in year
seven. For the six months ended March 31, 2004, EVM contractually waived
$176,252, $68,325, $45,419, $31,123, $26,899, $45,847, $45,746, $44,016 and
$52,186 for Insured Municipal Fund II, Insured California Fund II, Insured
Florida Fund, Insured Massachusetts Fund, Insured Michigan Fund, Insured New
Jersey Fund, Insured New York Fund II, Insured Ohio Fund and Insured
Pennsylvania Fund, respectively.
Eaton Vance has agreed to pay offering costs (other than sales load) that
exceed $0.03 per common share. Eaton Vance has agreed to reimburse all Fund
organization costs.
EVM made a voluntary reimbursement to the Eaton Vance Insured New York
Municipal Bond Fund II of $10,000 to compensate the Fund for a realized loss
incurred from the sale of an investment security in violation of the Fund's
investment restrictions.
63
Certain officers and one Trustee of each Fund are officers of the above
organization.
During the six months ended March 31, 2004, the Insured Florida Fund engaged
in a sale transaction in the amount of $512,305 with a Portfolio which
utilizes Boston Management and Research, a wholly-owned subsidiary of EVM, as
an investment adviser. The sale transaction complied with Rule 17a-7 under
the Investment Company Act of 1940.
5 INVESTMENTS
Purchases and sales of investments, other than U.S. Government securities and
short-term obligations, for the six months ended March 31, 2004 were as
follows:
INSURED MUNICIPAL FUND II
Purchases $ 23,877,307
Sales 36,285,993
INSURED CALIFORNIA FUND II
Purchases $ 3,496,567
Sales 5,201,220
INSURED FLORIDA FUND
Purchases $ 3,359,230
Sales 3,727,206
INSURED MASSACHUSETTS FUND
Purchases $ 5,756,656
Sales 7,623,894
INSURED MICHIGAN FUND
Purchases $ 1,008,130
Sales 1,788,436
INSURED NEW JERSEY FUND
Purchases $ 3,266,377
Sales 4,788,648
INSURED NEW YORK FUND II
Purchases $ 4,405,160
Sales 6,620,428
INSURED OHIO FUND
Purchases $ 2,202,732
Sales 3,383,109
INSURED PENNSYLVANIA FUND
Purchases $ 3,716,463
Sales 4,624,178
6 FEDERAL INCOME TAX BASIS OF UNREALIZED APPRECIATION (DEPRECIATION)
The cost and unrealized appreciation (depreciation) in value of the
investments owned by each Fund at March 31, 2004, as computed for Federal
income tax purposes, were as follows:
INSURED MUNICIPAL FUND II
AGGREGATE COST $ 221,787,116
------------------------------------------------------------
Gross unrealized appreciation $ 10,709,338
Gross unrealized depreciation (900,142)
------------------------------------------------------------
NET UNREALIZED APPRECIATION $ 9,809,196
------------------------------------------------------------
INSURED CALIFORNIA FUND II
AGGREGATE COST $ 86,314,140
------------------------------------------------------------
Gross unrealized appreciation $ 3,748,823
Gross unrealized depreciation --
------------------------------------------------------------
NET UNREALIZED APPRECIATION $ 3,748,823
------------------------------------------------------------
INSURED FLORIDA FUND
AGGREGATE COST $ 57,227,193
------------------------------------------------------------
Gross unrealized appreciation $ 2,565,102
Gross unrealized depreciation --
------------------------------------------------------------
NET UNREALIZED APPRECIATION $ 2,565,102
------------------------------------------------------------
INSURED MASSACHUSETTS FUND
AGGREGATE COST $ 39,447,810
------------------------------------------------------------
Gross unrealized appreciation $ 1,591,194
Gross unrealized depreciation (17,220)
------------------------------------------------------------
NET UNREALIZED APPRECIATION $ 1,573,974
------------------------------------------------------------
INSURED MICHIGAN FUND
AGGREGATE COST $ 33,805,685
------------------------------------------------------------
Gross unrealized appreciation $ 1,620,853
Gross unrealized depreciation --
------------------------------------------------------------
NET UNREALIZED APPRECIATION $ 1,620,853
------------------------------------------------------------
64
INSURED NEW JERSEY FUND
AGGREGATE COST $ 57,886,572
------------------------------------------------------------
Gross unrealized appreciation $ 2,965,664
Gross unrealized depreciation (6,705)
------------------------------------------------------------
NET UNREALIZED APPRECIATION $ 2,958,959
------------------------------------------------------------
INSURED NEW YORK FUND II
AGGREGATE COST $ 56,787,798
------------------------------------------------------------
Gross unrealized appreciation $ 2,884,622
Gross unrealized depreciation --
------------------------------------------------------------
NET UNREALIZED APPRECIATION $ 2,884,622
------------------------------------------------------------
INSURED OHIO FUND
AGGREGATE COST $ 55,837,218
------------------------------------------------------------
Gross unrealized appreciation $ 2,286,403
Gross unrealized depreciation (703)
------------------------------------------------------------
NET UNREALIZED APPRECIATION $ 2,285,700
------------------------------------------------------------
INSURED PENNSYLVANIA FUND
AGGREGATE COST $ 66,207,343
------------------------------------------------------------
Gross unrealized appreciation $ 2,656,463
Gross unrealized depreciation --
------------------------------------------------------------
NET UNREALIZED APPRECIATION $ 2,656,463
------------------------------------------------------------
7 SHARES OF BENEFICIAL INTEREST
The Declaration of Trust permits the Funds to issue an unlimited number of
full and fractional $0.01 par value common shares. Transactions in common
shares for the six months ended March 31, 2004 were as follows:
INSURED MUNICIPAL FUND II
--------------------------------------------
SIX MONTHS ENDED
MARCH 31, 2004 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 2003(1)
-----------------------------------------------------------------------------------------
Sales -- 9,897,891
Shares issued pursuant to the Fund's
dividend reinvestment plan 7,131 3,023
-----------------------------------------------------------------------------------------
NET INCREASE 7,131 9,900,914
-----------------------------------------------------------------------------------------
INSURED CALIFORNIA FUND II
--------------------------------------------
SIX MONTHS ENDED
MARCH 31, 2004 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 2003(1)
-----------------------------------------------------------------------------------------
Sales -- 3,844,564
Shares issued pursuant to the Fund's
dividend reinvestment plan 942 26
-----------------------------------------------------------------------------------------
NET INCREASE 942 3,844,590
-----------------------------------------------------------------------------------------
INSURED FLORIDA FUND
--------------------------------------------
SIX MONTHS ENDED
MARCH 31, 2004 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 2003(1)
-----------------------------------------------------------------------------------------
Sales -- 2,535,523
Shares issued pursuant to the Fund's
dividend reinvestment plan 3,671 13,733
-----------------------------------------------------------------------------------------
NET INCREASE 3,671 2,549,256
-----------------------------------------------------------------------------------------
INSURED MASSACHUSETTS FUND
--------------------------------------------
SIX MONTHS ENDED
MARCH 31, 2004 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 2003(1)
-----------------------------------------------------------------------------------------
Sales -- 1,736,767
Shares issued pursuant to the Fund's
dividend reinvestment plan 1,346 606
-----------------------------------------------------------------------------------------
NET INCREASE 1,346 1,737,373
-----------------------------------------------------------------------------------------
INSURED MICHIGAN FUND
--------------------------------------------
SIX MONTHS ENDED
MARCH 31, 2004 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 2003(1)
-----------------------------------------------------------------------------------------
Sales -- 1,500,707
Shares issued pursuant to the Fund's
dividend reinvestment plan 352 556
-----------------------------------------------------------------------------------------
NET INCREASE 352 1,501,263
-----------------------------------------------------------------------------------------
INSURED NEW JERSEY FUND
--------------------------------------------
SIX MONTHS ENDED
MARCH 31, 2004 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 2003(1)
-----------------------------------------------------------------------------------------
Sales -- 2,546,634
Shares issued pursuant to the Fund's
dividend reinvestment plan 2,406 553
-----------------------------------------------------------------------------------------
NET INCREASE 2,406 2,547,187
-----------------------------------------------------------------------------------------
65
INSURED NEW YORK FUND II
--------------------------------------------
SIX MONTHS ENDED
MARCH 31, 2004 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 2003(1)
-----------------------------------------------------------------------------------------
Sales -- 2,546,647
Shares issued pursuant to the Fund's
dividend reinvestment plan -- 289
-----------------------------------------------------------------------------------------
NET INCREASE -- 2,546,936
-----------------------------------------------------------------------------------------
INSURED OHIO FUND
--------------------------------------------
SIX MONTHS ENDED
MARCH 31, 2004 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 2003(1)
-----------------------------------------------------------------------------------------
Sales -- 2,496,446
Shares issued pursuant to the Fund's
dividend reinvestment plan 2,400 1,073
-----------------------------------------------------------------------------------------
NET INCREASE 2,400 2,497,519
-----------------------------------------------------------------------------------------
INSURED PENNSYLVANIA FUND
--------------------------------------------
SIX MONTHS ENDED
MARCH 31, 2004 YEAR ENDED
(UNAUDITED) SEPTEMBER 30, 2003(1)
-----------------------------------------------------------------------------------------
Sales -- 2,930,531
Shares issued pursuant to the Fund's
dividend reinvestment plan 1,564 426
-----------------------------------------------------------------------------------------
NET INCREASE 1,564 2,930,957
-----------------------------------------------------------------------------------------
(1) For the period from the start of business, November 29, 2002, to
September 30, 2003.
8 FINANCIAL INSTRUMENTS
Each Fund may trade in financial instruments with off-balance sheet risk in
the normal course of its investing activities to assist in managing exposure
to various market risks. These financial instruments include futures
contracts and may involve, to a varying degree, elements of risk in excess of
the amounts recognized for financial statement purposes. The notional or
contractual amounts of these instruments represent the investment each Fund
has in particular classes of financial instruments and does not necessarily
represent the amounts potentially subject to risk. The measurement of the
risks associated with these instruments is meaningful only when all related
and offsetting transactions are considered.
A summary of obligations under these financial instruments at March 31, 2004
is as follows:
FUTURES CONTRACTS
EXPIRATION NET UNREALIZED
FUND DATE CONTRACTS POSITION DEPRECIATION
-------------------------------------------------------------------------------------------
Insured
Municipal II 6/04 1,000 U.S. Treasury Bond Short $ (2,308,937)
-------------------------------------------------------------------------------------------
Insured
California II 6/04 125 U.S. Treasury Bond Short $ (287,641)
-------------------------------------------------------------------------------------------
Insured Florida 6/04 85 U.S. Treasury Bond Short $ (195,596)
-------------------------------------------------------------------------------------------
Insured
Massachusetts 6/04 80 U.S. Treasury Bond Short $ (183,778)
-------------------------------------------------------------------------------------------
Insured Michigan 6/04 77 U.S. Treasury Bond Short $ (166,499)
-------------------------------------------------------------------------------------------
Insured
New Jersey 6/04 100 U.S. Treasury Bond Short $ (229,722)
-------------------------------------------------------------------------------------------
Insured
New York II 6/04 125 U.S. Treasury Bond Short $ (288,617)
-------------------------------------------------------------------------------------------
Insured Ohio 6/04 165 U.S. Treasury Bond Short $ (380,975)
-------------------------------------------------------------------------------------------
Insured
Pennsylvania 6/04 96 U.S. Treasury Bond Short $ (220,908)
-------------------------------------------------------------------------------------------
At March 31, 2004, each Fund had sufficient cash and/or securities to cover
margin requirements on open future contracts.
66
EATON VANCE INSURED MUNICIPAL BOND FUNDS
DIVIDEND REINVESTMENT PLAN
Each Fund offers a dividend reinvestment plan (the Plan) pursuant to which
shareholders may elect to have dividends and capital gains distributions
automatically reinvested in common shares (the Shares) of the same Fund. You may
elect to participate in the Plan by completing the Dividend Reinvestment Plan
Application Form. If you do not participate, you will receive all distributions
in cash paid by check mailed directly to you by PFPC Inc. as dividend paying
agent. On the distribution payment date, if the net asset value per Share is
equal to or less than the market price per Share plus estimated brokerage
commissions, then new Shares will be issued. The number of Shares shall be
determined by the greater of the net asset value per Share or 95% of the market
price. Otherwise, Shares generally will be purchased on the open market by the
Plan Agent. Distributions subject to income tax (if any) are taxable whether or
not shares are reinvested.
If your shares are in the name of a brokerage firm, bank, or other nominee, you
can ask the firm or nominee to participate in the Plan on your behalf. If the
nominee does not offer the Plan, you will need to request that your shares be
re-registered in your name with each Fund's transfer agent, PFPC Inc., or you
will not be able to participate.
The Plan Agent's service fee for handling distributions will be paid by each
Fund. Each participant will be charged their pro rata share of brokerage
commissions on all open-market purchases.
Plan participants may withdraw from the Plan at any time by writing to the Plan
Agent at the address noted on the following page. If you withdraw, you will
receive shares in your name for all Shares credited to your account under the
Plan. If a participant elects by written notice to the Plan Agent to have the
Plan Agent sell part or all of his or her Shares and remit the proceeds, the
Plan Agent is authorized to deduct a $5.00 fee plus brokerage commissions from
the proceeds.
If you wish to participate in the Plan and your shares are held in your own
name, you may complete the form on the following page and deliver it to the Plan
Agent.
Any inquiries regarding the Plan can be directed to the Plan Agent, PFPC Inc.,
at 1-800-331-1710.
67
EATON VANCE INSURED MUNICIPAL BOND FUNDS
APPLICATION FOR PARTICIPATION IN DIVIDEND REINVESTMENT PLAN
This form is for shareholders who hold their common shares in their own
names. If your common shares are held in the name of a brokerage firm, bank,
or other nominee, you should contact your nominee to see if it will
participate in the Plan on your behalf. If you wish to participate in the
Plan, but your brokerage firm, bank, or nominee is unable to participate on
your behalf, you should request that your common shares be re-registered in
your own name which will enable your participation in the Plan.
The following authorization and appointment is given with the understanding
that I may terminate it at any time by terminating my participation in the
Plan as provided in the terms and conditions of the Plan.
-----------------------------------------------------------
Please print exact name on account
-----------------------------------------------------------
Shareholder signature Date
-----------------------------------------------------------
Shareholder signature Date
Please sign exactly as your common shares are registered.
All persons whose names appear on the share certificate
must sign.
YOU SHOULD NOT RETURN THIS FORM IF YOU WISH TO RECEIVE YOUR DIVIDENDS AND
DISTRIBUTIONS IN CASH. THIS IS NOT A PROXY.
THIS AUTHORIZATION FORM, WHEN SIGNED, SHOULD BE MAILED TO THE FOLLOWING
ADDRESS:
Eaton Vance Insured Municipal Bond Funds
c/o PFPC Inc.
P.O. Box 43027
Providence, RI 02940-3027
800-331-1710
NUMBER OF EMPLOYEES
Each Fund is organized as a Massachusetts business trust and is registered
under the Investment Company Act of 1940, as amended, as a closed-end,
nondiversified, management investment company and has no employees.
NUMBER OF SHAREHOLDERS
As of March 31, 2004, our records indicate that there are 32, 11, 9, 7, 9, 9,
20, 23 and 56 registered shareholders for Insured Municipal Fund II, Insured
California Fund II, Insured Florida Fund, Insured Massachusetts Fund, Insured
Michigan Fund, Insured New Jersey Fund, Insured New York Fund II, Insured
Ohio Fund and Insured Pennsylvania Fund, respectively, and approximately
4,700, 1,500, 1,200, 900, 900, 1,500, 1,300, 1,400 and 1,900 shareholders
owning the Fund shares in street name, such as through brokers, banks, and
financial intermediaries for Insured Municipal Fund II, Insured California
Fund II, Insured Florida Fund, Insured Massachusetts Fund, Insured Michigan
Fund, Insured New Jersey Fund, Insured New York Fund II, Insured Ohio Fund
and Insured Pennsylvania Fund, respectively.
If you are a street name shareholder and wish to receive Fund reports
directly, which contain important information about a Fund, please write or
call:
Eaton Vance Distributors, Inc.
The Eaton Vance Building
255 State Street
Boston, MA 02109
1-800-225-6265
AMERICAN STOCK EXCHANGE SYMBOLS
Insured Municipal Fund II EIV
Insured California Fund II EIA
Insured Florida Fund EIF
Insured Massachusetts Fund MAB
Insured Michigan Fund MIW
Insured New Jersey Fund EMJ
Insured New York Fund II NYH
Insured Ohio Fund EIO
Insured Pennsylvania Fund EIP
68
EATON VANCE INSURED MUNICIPAL BOND FUNDS
INVESTMENT MANAGEMENT
EATON VANCE INSURED MUNICIPAL BOND FUNDS
OFFICERS
Thomas J. Fetter
President and Portfolio Manager of
Insured Municipal Bond Fund II,
Insured New York Municipal Bond
Fund II and Insured Ohio Municipal
Bond Fund
James B. Hawkes
Vice President and Trustee
William H. Ahern, Jr.
Vice President and Portfolio Manager of
Insured Michigan Municipal Bond Fund
Cynthia J. Clemson
Vice President and Portfolio Manager
of Insured California Municipal Bond
Fund II, Insured Florida Municipal
Bond Fund and Insured Pennsylvania
Municipal Bond Fund
Robert B. MacIntosh
Vice President and Portfolio Manager
of Insured Massachusetts Municipal
Bond Fund and Insured New Jersey
Municipal Bond Fund
James L O'Connor
Treasurer
Alan R. Dynner
Secretary
TRUSTEES
Samuel L. Hayes, III
William H. Park
Ronald A. Pearlman
Norton H. Reamer
Lynn A. Stout
69
INVESTMENT ADVISER AND ADMINISTRATOR OF EATON VANCE INSURED MUNICIPAL BOND FUNDS
EATON VANCE MANAGEMENT
The Eaton Vance Building
255 State Street
Boston, MA 02109
CUSTODIAN
INVESTORS BANK & TRUST COMPANY
200 Clarendon Street
Boston, MA 02116
TRANSFER AGENT AND DIVIDEND DISBURSING AGENT
PFPC INC.
Attn: Eaton Vance Insured Municipal Bond Funds
P.O. Box 43027
Providence, RI 02940-3027
(800) 331-1710
EATON VANCE INSURED MUNICIPAL BOND FUNDS
THE EATON VANCE BUILDING
255 STATE STREET
BOSTON, MA 02109
1557-5/04 9IMBIISRC
ITEM 2. CODE OF ETHICS
The registrant has adopted a code of ethics applicable to its Principal
Executive Officer, Principal Financial Officer and Principal Accounting Officer.
The registrant undertakes to provide a copy of such code of ethics to any person
upon request, without charge, by calling 1-800-262-1122.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT
The registrant's Board has designated William H. Park, Samuel L. Hayes, III and
Norton H. Reamer, each an independent trustee, as its audit committee financial
experts. Mr. Park is a certified public accountant who is the President and
Chief Executive Officer of Prizm Capital Management, LLC (investment management
firm). Previously, he served as Executive Vice President and Chief Financial
Officer of United Asset Management Corporation ("UAM") (a holding company owning
institutional investment management firms). Mr. Hayes is the Jacob H. Schiff
Professor of Investment Banking Emeritus of the Harvard University Graduate
School of Business Administration. Mr. Reamer is the President, Chief Executive
Officer and a Director of Asset Management Finance Corp. (a specialty finance
company serving the investment management industry) and is President of Unicorn
Corporation (an investment and financial advisory services company). Formerly,
Mr. Reamer was Chairman of Hellman, Jordan Management Co., Inc. (an investment
management company) and Advisory Director of Berkshire Capital Corporation (an
investment banking firm), Chairman of the Board of UAM and Chairman, President
and Director of the UAM Funds (mutual funds).
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Not required in this filing
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Not required in this filing.
ITEM 6. SCHEDULE OF INVESTMENTS
Please see schedule of investments contained in the Report to Stockholders
included under Item 1 of this Form N-CSR.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES
The Board of Trustees of the Trust has adopted a proxy voting policy and
procedure (the "Fund Policy"), pursuant to which the Trustees have delegated
proxy voting responsibility to the Fund's investment adviser and adopted the
investment adviser's proxy voting policies and procedures (the "Policies") which
are described below. The Trustees will review the Fund's proxy voting records
from time to time and will annually consider approving the Policies for the
upcoming year. In the event that a conflict of interest arises between the
Fund's shareholders and the investment adviser, the administrator, or any of
their affiliates or any affiliate of the Fund, the investment adviser will
generally refrain from voting the proxies related to the companies giving rise
to such conflict until it consults with the Board of the Fund except as
contemplated under the Fund Policy. The Board's Special Committee will instruct
the investment adviser on the appropriate course of action.
The Policies are designed to promote accountability of a company's management to
its shareholders and to align the interests of management with those
shareholders. The investment adviser will generally support company management
on proposals relating to environmental and social policy issues and on matters
regarding the state of organization of the company. On all other matters, the
investment adviser will take management's proposals under advisement but will
consider each matter in light of the guidelines set forth in the Policies.
Except in the instance of routine matters related to corporate administration
which are not expected to have a significant economic impact on the company or
its shareholders (on which the investment adviser will routinely vote with
management), the investment adviser will review each matter on a case-by-case
basis and reserves the right to deviate from the Policies guidelines when it
believes the situation warrants such a deviation. The Policy includes voting
guidelines for matters relating to, among other things, the election of
directors, approval of independent auditors, executive compensation, corporate
structure and anti-takeover defenses. The investment adviser may abstain from
voting from time to time where it determines that the costs associated with
voting a proxy outweighs the benefits derived from exercising the right to vote.
In addition, the investment adviser will monitor situations that may result in a
conflict of interest between the Fund's shareholders and the investment adviser,
the administrator, or any of their affiliates or any affiliate of the Fund by
maintaining a list of significant existing and prospective corporate clients.
The investment adviser's personnel responsible for reviewing and voting proxies
on behalf of the Fund will report any proxy received or expected to be received
from a company included on that list to the investment adviser's general counsel
or chief equity investment officer. The general counsel or chief equity
investment officer will determine if a conflict exists. If a conflict does
exist, the proxy will either be voted strictly in accordance with the Policy or
the investment adviser will seek instruction on how to vote from the Board.
Effective August 31, 2004, information on how the Fund voted proxies relating to
portfolio securities during the 12 month period ended June 30, 2004 [is/will be]
available (1) without charge, upon request, by calling 1-800-262-1122, and (2)
on the Securities and Exchange Commission's website at http://www.sec.gov.
ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not required in this filing.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Effective February 9, 2004, the Governance Committee of the Board of Trustees
formalized the procedures by which a Fund's shareholders may recommend nominees
to the registrant's Board of Trustees. The Governance Committee shall, when
identifying candidates for the position of Independent Trustee, consider any
such candidate recommended by a shareholder of a Fund if such recommendation
contains sufficient background information concerning the candidate, and is
received in a sufficiently timely manner (and in any event no later than the
date specified for receipt of shareholder proposals in any applicable proxy
statement with respect to a Fund). Shareholders shall be directed to address any
such recommendations to the attention of the Governance Committee, c/o the
Secretary of the Fund.
ITEM 10. CONTROLS AND PROCEDURES
(a) It is the conclusion of the registrant's principal executive officer and
principal financial officer that the effectiveness of the registrant's current
disclosure controls and procedures (such disclosure controls and procedures
having been evaluated within 90 days of the date of this filing) provide
reasonable assurance that the information required to be disclosed by the
registrant has been recorded, processed, summarized and reported within the time
period specified in the Commission's rules and forms and that the information
required to be disclosed by the registrant has been accumulated and communicated
to the registrant's principal executive officer and principal financial officer
in order to allow timely decisions regarding required disclosure.
(b) There have been no changes in the registrant's internal controls over
financial reporting during the period that has materially affected, or is
reasonably likely to materially affect the registrant's internal control over
financial reporting.
ITEM 11. EXHIBITS
(a)(1) Registrant's Code of Ethics - Not applicable (please see Item 2).
(a)(2)(i) Treasurer's Section 302 certification.
(a)(2)(ii) President's Section 302 certification.
(b) Combined Section 906 certification.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
EATON VANCE INSURED MUNICIPAL BOND FUND II
By: /s/ Thomas J. Fetter
-----------------------------------------------
Thomas J. Fetter
President
Date: May 20, 2004
------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ James L. O'Connor
-----------------------------------------------
James L. O'Connor
Treasurer
Date: May 20, 2004
------------
By: /s/ Thomas J. Fetter
-----------------------------------------------
Thomas J. Fetter
President
Date: May 20, 2004
------------
ITEM 2. CODE OF ETHICS
The registrant has adopted a code of ethics applicable to its Principal
Executive Officer, Principal Financial Officer and Principal Accounting Officer.
The registrant undertakes to provide a copy of such code of ethics to any person
upon request, without charge, by calling 1-800-262-1122.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT
The registrant's Board has designated William H. Park, Samuel L. Hayes, III and
Norton H. Reamer, each an independent trustee, as its audit committee financial
experts. Mr. Park is a certified public accountant who is the President and
Chief Executive Officer of Prizm Capital Management, LLC (investment management
firm). Previously, he served as Executive Vice President and Chief Financial
Officer of United Asset Management Corporation ("UAM") (a holding company owning
institutional investment management firms). Mr. Hayes is the Jacob H. Schiff
Professor of Investment Banking Emeritus of the Harvard University Graduate
School of Business Administration. Mr. Reamer is the President, Chief Executive
Officer and a Director of Asset Management Finance Corp. (a specialty finance
company serving the investment management industry) and is President of Unicorn
Corporation (an investment and financial advisory services company). Formerly,
Mr. Reamer was Chairman of Hellman, Jordan Management Co., Inc. (an investment
management company) and Advisory Director of Berkshire Capital Corporation (an
investment banking firm), Chairman of the Board of UAM and Chairman, President
and Director of the UAM Funds (mutual funds).
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Not required in this filing
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Not required in this filing.
ITEM 6. SCHEDULE OF INVESTMENTS
Please see schedule of investments contained in the Report to Stockholders
included under Item 1 of this Form N-CSR.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES
The Board of Trustees of the Trust has adopted a proxy voting policy and
procedure (the "Fund Policy"), pursuant to which the Trustees have delegated
proxy voting responsibility to the Fund's investment adviser and adopted the
investment adviser's proxy voting policies and procedures (the "Policies") which
are described below. The Trustees will review the Fund's proxy voting records
from time to time and will annually consider approving the Policies for the
upcoming year. In the event that a conflict of interest arises between the
Fund's shareholders and the investment adviser, the administrator, or any of
their affiliates or any affiliate of the Fund, the investment adviser will
generally refrain from voting the proxies related to the companies giving rise
to such conflict until it consults with the Board of the Fund except as
contemplated under the Fund Policy. The Board's Special Committee will instruct
the investment adviser on the appropriate course of action.
The Policies are designed to promote accountability of a company's management to
its shareholders and to align the interests of management with those
shareholders. The investment adviser will generally support company management
on proposals relating to environmental and social policy issues and on matters
regarding the state of organization of the company. On all other matters, the
investment adviser will take management's proposals under advisement but will
consider each matter in light of the guidelines set forth in the Policies.
Except in the instance of routine matters related to corporate administration
which are not expected to have a significant economic impact on the company or
its shareholders (on which the investment adviser will routinely vote with
management), the investment adviser will review each matter on a case-by-case
basis and reserves the right to deviate from the Policies guidelines when it
believes the situation warrants such a deviation. The Policy includes voting
guidelines for matters relating to, among other things, the election of
directors, approval of independent auditors, executive compensation, corporate
structure and anti-takeover defenses. The investment adviser may abstain from
voting from time to time where it determines that the costs associated with
voting a proxy outweighs the benefits derived from exercising the right to vote.
In addition, the investment adviser will monitor situations that may result in a
conflict of interest between the Fund's shareholders and the investment adviser,
the administrator, or any of their affiliates or any affiliate of the Fund by
maintaining a list of significant existing and prospective corporate clients.
The investment adviser's personnel responsible for reviewing and voting proxies
on behalf of the Fund will report any proxy received or expected to be received
from a company included on that list to the investment adviser's general counsel
or chief equity investment officer. The general counsel or chief equity
investment officer will determine if a conflict exists. If a conflict does
exist, the proxy will either be voted strictly in accordance with the Policy or
the investment adviser will seek instruction on how to vote from the Board.
Effective August 31, 2004, information on how the Fund voted proxies relating to
portfolio securities during the 12 month period ended June 30, 2004 [is/will be]
available (1) without charge, upon request, by calling 1-800-262-1122, and (2)
on the Securities and Exchange Commission's website at http://www.sec.gov.
ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not required in this filing.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Effective February 9, 2004, the Governance Committee of the Board of Trustees
formalized the procedures by which a Fund's shareholders may recommend nominees
to the registrant's Board of Trustees. The Governance Committee shall, when
identifying candidates for the position of Independent Trustee, consider any
such candidate recommended by a shareholder of a Fund if such recommendation
contains sufficient background information concerning the candidate, and is
received in a sufficiently timely manner (and in any event no later than the
date specified for receipt of shareholder proposals in any applicable proxy
statement with respect to a Fund). Shareholders shall be directed to address any
such recommendations to the attention of the Governance Committee, c/o the
Secretary of the Fund.
ITEM 10. CONTROLS AND PROCEDURES
(a) It is the conclusion of the registrant's principal executive officer and
principal financial officer that the effectiveness of the registrant's current
disclosure controls and procedures (such disclosure controls and procedures
having been evaluated within 90 days of the date of this filing) provide
reasonable assurance that the information required to be disclosed by the
registrant has been recorded, processed, summarized and reported within the time
period specified in the Commission's rules and forms and that the information
required to be disclosed by the registrant has been accumulated and communicated
to the registrant's principal executive officer and principal financial officer
in order to allow timely decisions regarding required disclosure.
(b) There have been no changes in the registrant's internal controls over
financial reporting during the period that has materially affected, or is
reasonably likely to materially affect the registrant's internal control over
financial reporting.
ITEM 11. EXHIBITS
(a)(1) Registrant's Code of Ethics - Not applicable (please see Item 2).
(a)(2)(i) Treasurer's Section 302 certification.
(a)(2)(ii) President's Section 302 certification.
(b) Combined Section 906 certification.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
EATON VANCE INSURED CALIFORNIA II MUNICIPAL BOND FUND
By: /S/ Thomas J. Fetter
--------------------
Thomas J. Fetter
President
Date: May 20, 2004
------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /S/ James L. O'Connor
---------------------
James L. O'Connor
Treasurer
Date: May 20, 2004
------------
By: /S/ Thomas J. Fetter
---------------------
Thomas J. Fetter
President
Date: May 20, 2004
------------
ITEM 2. CODE OF ETHICS
The registrant has adopted a code of ethics applicable to its Principal
Executive Officer, Principal Financial Officer and Principal Accounting Officer.
The registrant undertakes to provide a copy of such code of ethics to any person
upon request, without charge, by calling 1-800-262-1122.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT
The registrant's Board has designated William H. Park, Samuel L. Hayes, III and
Norton H. Reamer, each an independent trustee, as its audit committee financial
experts. Mr. Park is a certified public accountant who is the President and
Chief Executive Officer of Prizm Capital Management, LLC (investment management
firm). Previously, he served as Executive Vice President and Chief Financial
Officer of United Asset Management Corporation ("UAM") (a holding company owning
institutional investment management firms). Mr. Hayes is the Jacob H. Schiff
Professor of Investment Banking Emeritus of the Harvard University Graduate
School of Business Administration. Mr. Reamer is the President, Chief Executive
Officer and a Director of Asset Management Finance Corp. (a specialty finance
company serving the investment management industry) and is President of Unicorn
Corporation (an investment and financial advisory services company). Formerly,
Mr. Reamer was Chairman of Hellman, Jordan Management Co., Inc. (an investment
management company) and Advisory Director of Berkshire Capital Corporation (an
investment banking firm), Chairman of the Board of UAM and Chairman, President
and Director of the UAM Funds (mutual funds).
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Not required in this filing
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Not required in this filing.
ITEM 6. SCHEDULE OF INVESTMENTS
Please see schedule of investments contained in the Report to Stockholders
included under Item 1 of this Form N-CSR.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES
The Board of Trustees of the Trust has adopted a proxy voting policy and
procedure (the "Fund Policy"), pursuant to which the Trustees have delegated
proxy voting responsibility to the Fund's investment adviser and adopted the
investment adviser's proxy voting policies and procedures (the "Policies") which
are described below. The Trustees will review the Fund's proxy voting records
from time to time and will annually consider approving the Policies for the
upcoming year. In the event that a conflict of interest arises between the
Fund's shareholders and the investment adviser, the administrator, or any of
their affiliates or any affiliate of the Fund, the investment adviser will
generally refrain from voting the proxies related to the companies giving rise
to such conflict until it consults with the Board of the Fund except as
contemplated under the Fund Policy. The Board's Special Committee will instruct
the investment adviser on the appropriate course of action.
The Policies are designed to promote accountability of a company's management to
its shareholders and to align the interests of management with those
shareholders. The investment adviser will generally support company management
on proposals relating to environmental and social policy issues and on matters
regarding the state of organization of the company. On all other matters, the
investment adviser will take management's proposals under advisement but will
consider each matter in light of the guidelines set forth in the Policies.
Except in the instance of routine matters related to corporate administration
which are not expected to have a significant economic impact on the company or
its shareholders (on which the investment adviser will routinely vote with
management), the investment adviser will review each matter on a case-by-case
basis and reserves the right to deviate from the Policies guidelines when it
believes the situation warrants such a deviation. The Policy includes voting
guidelines for matters relating to, among other things, the election of
directors, approval of independent auditors, executive compensation, corporate
structure and anti-takeover defenses. The investment adviser may abstain from
voting from time to time where it determines that the costs associated with
voting a proxy outweighs the benefits derived from exercising the right to vote.
In addition, the investment adviser will monitor situations that may result in a
conflict of interest between the Fund's shareholders and the investment adviser,
the administrator, or any of their affiliates or any affiliate of the Fund by
maintaining a list of significant existing and prospective corporate clients.
The investment adviser's personnel responsible for reviewing and voting proxies
on behalf of the Fund will report any proxy received or expected to be received
from a company included on that list to the investment adviser's general counsel
or chief equity investment officer. The general counsel or chief equity
investment officer will determine if a conflict exists. If a conflict does
exist, the proxy will either be voted strictly in accordance with the Policy or
the investment adviser will seek instruction on how to vote from the Board.
Effective August 31, 2004, information on how the Fund voted proxies relating to
portfolio securities during the 12 month period ended June 30, 2004 [is/will be]
available (1) without charge, upon request, by calling 1-800-262-1122, and (2)
on the Securities and Exchange Commission's website at http://www.sec.gov.
ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not required in this filing.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Effective February 9, 2004, the Governance Committee of the Board of Trustees
formalized the procedures by which a Fund's shareholders may recommend nominees
to the registrant's Board of Trustees. The Governance Committee shall, when
identifying candidates for the position of Independent Trustee, consider any
such candidate recommended by a shareholder of a Fund if such recommendation
contains sufficient background information concerning the candidate, and is
received in a sufficiently timely manner (and in any event no later than the
date specified for receipt of shareholder proposals in any applicable proxy
statement with respect to a Fund). Shareholders shall be directed to address any
such recommendations to the attention of the Governance Committee, c/o the
Secretary of the Fund.
ITEM 10. CONTROLS AND PROCEDURES
(a) It is the conclusion of the registrant's principal executive officer and
principal financial officer that the effectiveness of the registrant's current
disclosure controls and procedures (such disclosure controls and procedures
having been evaluated within 90 days of the date of this filing) provide
reasonable assurance that the information required to be disclosed by the
registrant has been recorded, processed, summarized and reported within the time
period specified in the Commission's rules and forms and that the information
required to be disclosed by the registrant has been accumulated and communicated
to the registrant's principal executive officer and principal financial officer
in order to allow timely decisions regarding required disclosure.
(b) There have been no changes in the registrant's internal controls over
financial reporting during the period that has materially affected, or is
reasonably likely to materially affect the registrant's internal control over
financial reporting.
ITEM 11. EXHIBITS
(a)(1) Registrant's Code of Ethics - Not applicable (please see Item 2).
(a)(2)(i) Treasurer's Section 302 certification.
(a)(2)(ii) President's Section 302 certification.
(b) Combined Section 906 certification.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
EATON VANCE INSURED FLORIDA MUNICIPAL BOND FUND
By: /s/ Thomas J. Fetter
--------------------
Thomas J. Fetter
President
Date: May 20, 2004
------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ James L. O'Connor
---------------------
James L. O'Connor
Treasurer
Date: May 20, 2004
------------
By: /s/ Thomas J. Fetter
--------------------
Thomas J. Fetter
President
Date: May 20, 2004
------------
ITEM 2. CODE OF ETHICS
The registrant has adopted a code of ethics applicable to its Principal
Executive Officer, Principal Financial Officer and Principal Accounting Officer.
The registrant undertakes to provide a copy of such code of ethics to any person
upon request, without charge, by calling 1-800-262-1122.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT
The registrant's Board has designated William H. Park, Samuel L. Hayes, III and
Norton H. Reamer, each an independent trustee, as its audit committee financial
experts. Mr. Park is a certified public accountant who is the President and
Chief Executive Officer of Prizm Capital Management, LLC (investment management
firm). Previously, he served as Executive Vice President and Chief Financial
Officer of United Asset Management Corporation ("UAM") (a holding company owning
institutional investment management firms). Mr. Hayes is the Jacob H. Schiff
Professor of Investment Banking Emeritus of the Harvard University Graduate
School of Business Administration. Mr. Reamer is the President, Chief Executive
Officer and a Director of Asset Management Finance Corp. (a specialty finance
company serving the investment management industry) and is President of Unicorn
Corporation (an investment and financial advisory services company). Formerly,
Mr. Reamer was Chairman of Hellman, Jordan Management Co., Inc. (an investment
management company) and Advisory Director of Berkshire Capital Corporation (an
investment banking firm), Chairman of the Board of UAM and Chairman, President
and Director of the UAM Funds (mutual funds).
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Not required in this filing
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Not required in this filing.
ITEM 6. SCHEDULE OF INVESTMENTS
Please see schedule of investments contained in the Report to Stockholders
included under Item 1 of this Form N-CSR.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES
The Board of Trustees of the Trust has adopted a proxy voting policy and
procedure (the "Fund Policy"), pursuant to which the Trustees have delegated
proxy voting responsibility to the Fund's investment adviser and adopted the
investment adviser's proxy voting policies and procedures (the "Policies") which
are described below. The Trustees will review the Fund's proxy voting records
from time to time and will annually consider approving the Policies for the
upcoming year. In the event that a conflict of interest arises between the
Fund's shareholders and the investment adviser, the administrator, or any of
their affiliates or any affiliate of the Fund, the investment adviser will
generally refrain from voting the proxies related to the companies giving rise
to such conflict until it consults with the Board of the Fund except as
contemplated under the Fund Policy. The Board's Special Committee will instruct
the investment adviser on the appropriate course of action.
The Policies are designed to promote accountability of a company's management to
its shareholders and to align the interests of management with those
shareholders. The investment adviser will generally support company management
on proposals relating to environmental and social policy issues and on matters
regarding the state of organization of the company. On all other matters, the
investment adviser will take management's proposals under advisement but will
consider each matter in light of the guidelines set forth in the Policies.
Except in the instance of routine matters related to corporate administration
which are not expected to have a significant economic impact on the company or
its shareholders (on which the investment adviser will routinely vote with
management), the investment adviser will review each matter on a case-by-case
basis and reserves the right to deviate from the Policies guidelines when it
believes the situation warrants such a deviation. The Policy includes voting
guidelines for matters relating to, among other things, the election of
directors, approval of independent auditors, executive compensation, corporate
structure and anti-takeover defenses. The investment adviser may abstain from
voting from time to time where it determines that the costs associated with
voting a proxy outweighs the benefits derived from exercising the right to vote.
In addition, the investment adviser will monitor situations that may result in a
conflict of interest between the Fund's shareholders and the investment adviser,
the administrator, or any of their affiliates or any affiliate of the Fund by
maintaining a list of significant existing and prospective corporate clients.
The investment adviser's personnel responsible for reviewing and voting proxies
on behalf of the Fund will report any proxy received or expected to be received
from a company included on that list to the investment adviser's general counsel
or chief equity investment officer. The general counsel or chief equity
investment officer will determine if a conflict exists. If a conflict does
exist, the proxy will either be voted strictly in accordance with the Policy or
the investment adviser will seek instruction on how to vote from the Board.
Effective August 31, 2004, information on how the Fund voted proxies relating to
portfolio securities during the 12 month period ended June 30, 2004 [is/will be]
available (1) without charge, upon request, by calling 1-800-262-1122, and (2)
on the Securities and Exchange Commission's website at http://www.sec.gov.
ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not required in this filing.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Effective February 9, 2004, the Governance Committee of the Board of Trustees
formalized the procedures by which a Fund's shareholders may recommend nominees
to the registrant's Board of Trustees. The Governance Committee shall, when
identifying candidates for the position of Independent Trustee, consider any
such candidate recommended by a shareholder of a Fund if such recommendation
contains sufficient background information concerning the candidate, and is
received in a sufficiently timely manner (and in any event no later than the
date specified for receipt of shareholder proposals in any applicable proxy
statement with respect to a Fund). Shareholders shall be directed to address any
such recommendations to the attention of the Governance Committee, c/o the
Secretary of the Fund.
ITEM 10. CONTROLS AND PROCEDURES
(a) It is the conclusion of the registrant's principal executive officer and
principal financial officer that the effectiveness of the registrant's current
disclosure controls and procedures (such disclosure controls and procedures
having been evaluated within 90 days of the date of this filing) provide
reasonable assurance that the information required to be disclosed by the
registrant has been recorded, processed, summarized and reported within the time
period specified in the Commission's rules and forms and that the information
required to be disclosed by the registrant has been accumulated and communicated
to the registrant's principal executive officer and principal financial officer
in order to allow timely decisions regarding required disclosure.
(b) There have been no changes in the registrant's internal controls over
financial reporting during the period that has materially affected, or is
reasonably likely to materially affect the registrant's internal control over
financial reporting.
ITEM 11. EXHIBITS
(a)(1) Registrant's Code of Ethics - Not applicable (please see Item 2).
(a)(2)(i) Treasurer's Section 302 certification.
(a)(2)(ii) President's Section 302 certification.
(b) Combined Section 906 certification.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
EATON VANCE INSURED MASSACHUSETTS MUNICIPAL BOND FUND
By: /s/ Thomas J. Fetter
--------------------
Thomas J. Fetter
President
Date: May 20, 2004
------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ James L. O'Connor
---------------------
James L. O'Connor
Treasurer
Date: May 20, 2004
------------
By: /s/ Thomas J. Fetter
--------------------
Thomas J. Fetter
President
Date: May 20, 2004
------------
ITEM 2. CODE OF ETHICS
The registrant has adopted a code of ethics applicable to its Principal
Executive Officer, Principal Financial Officer and Principal Accounting Officer.
The registrant undertakes to provide a copy of such code of ethics to any person
upon request, without charge, by calling 1-800-262-1122.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT
The registrant's Board has designated William H. Park, Samuel L. Hayes, III and
Norton H. Reamer, each an independent trustee, as its audit committee financial
experts. Mr. Park is a certified public accountant who is the President and
Chief Executive Officer of Prizm Capital Management, LLC (investment management
firm). Previously, he served as Executive Vice President and Chief Financial
Officer of United Asset Management Corporation ("UAM") (a holding company owning
institutional investment management firms). Mr. Hayes is the Jacob H. Schiff
Professor of Investment Banking Emeritus of the Harvard University Graduate
School of Business Administration. Mr. Reamer is the President, Chief Executive
Officer and a Director of Asset Management Finance Corp. (a specialty finance
company serving the investment management industry) and is President of Unicorn
Corporation (an investment and financial advisory services company). Formerly,
Mr. Reamer was Chairman of Hellman, Jordan Management Co., Inc. (an investment
management company) and Advisory Director of Berkshire Capital Corporation (an
investment banking firm), Chairman of the Board of UAM and Chairman, President
and Director of the UAM Funds (mutual funds).
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Not required in this filing
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Not required in this filing.
ITEM 6. SCHEDULE OF INVESTMENTS
Please see schedule of investments contained in the Report to Stockholders
included under Item 1 of this Form N-CSR.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES
The Board of Trustees of the Trust has adopted a proxy voting policy and
procedure (the "Fund Policy"), pursuant to which the Trustees have delegated
proxy voting responsibility to the Fund's investment adviser and adopted the
investment adviser's proxy voting policies and procedures (the "Policies") which
are described below. The Trustees will review the Fund's proxy voting records
from time to time and will annually consider approving the Policies for the
upcoming year. In the event that a conflict of interest arises between the
Fund's shareholders and the investment adviser, the administrator, or any of
their affiliates or any affiliate of the Fund, the investment adviser will
generally refrain from voting the proxies related to the companies giving rise
to such conflict until it consults with the Board of the Fund except as
contemplated under the Fund Policy. The Board's Special Committee will instruct
the investment adviser on the appropriate course of action.
The Policies are designed to promote accountability of a company's management to
its shareholders and to align the interests of management with those
shareholders. The investment adviser will generally support company management
on proposals relating to environmental and social policy issues and on matters
regarding the state of organization of the company. On all other matters, the
investment adviser will take management's proposals under advisement but will
consider each matter in light of the guidelines set forth in the Policies.
Except in the instance of routine matters related to corporate administration
which are not expected to have a significant economic impact on the company or
its shareholders (on which the investment adviser will routinely vote with
management), the investment adviser will review each matter on a case-by-case
basis and reserves the right to deviate from the Policies guidelines when it
believes the situation warrants such a deviation. The Policy includes voting
guidelines for matters relating to, among other things, the election of
directors, approval of independent auditors, executive compensation, corporate
structure and anti-takeover defenses. The investment adviser may abstain from
voting from time to time where it determines that the costs associated with
voting a proxy outweighs the benefits derived from exercising the right to vote.
In addition, the investment adviser will monitor situations that may result in a
conflict of interest between the Fund's shareholders and the investment adviser,
the administrator, or any of their affiliates or any affiliate of the Fund by
maintaining a list of significant existing and prospective corporate clients.
The investment adviser's personnel responsible for reviewing and voting proxies
on behalf of the Fund will report any proxy received or expected to be received
from a company included on that list to the investment adviser's general counsel
or chief equity investment officer. The general counsel or chief equity
investment officer will determine if a conflict exists. If a conflict does
exist, the proxy will either be voted strictly in accordance with the Policy or
the investment adviser will seek instruction on how to vote from the Board.
Effective August 31, 2004, information on how the Fund voted proxies relating to
portfolio securities during the 12 month period ended June 30, 2004 [is/will be]
available (1) without charge, upon request, by calling 1-800-262-1122, and (2)
on the Securities and Exchange Commission's website at http://www.sec.gov.
ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not required in this filing.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Effective February 9, 2004, the Governance Committee of the Board of Trustees
formalized the procedures by which a Fund's shareholders may recommend nominees
to the registrant's Board of Trustees. The Governance Committee shall, when
identifying candidates for the position of Independent Trustee, consider any
such candidate recommended by a shareholder of a Fund if such recommendation
contains sufficient background information concerning the candidate, and is
received in a sufficiently timely manner (and in any event no later than the
date specified for receipt of shareholder proposals in any applicable proxy
statement with respect to a Fund). Shareholders shall be directed to address any
such recommendations to the attention of the Governance Committee, c/o the
Secretary of the Fund.
ITEM 10. CONTROLS AND PROCEDURES
(a) It is the conclusion of the registrant's principal executive officer and
principal financial officer that the effectiveness of the registrant's current
disclosure controls and procedures (such disclosure controls and procedures
having been evaluated within 90 days of the date of this filing) provide
reasonable assurance that the information required to be disclosed by the
registrant has been recorded, processed, summarized and reported within the time
period specified in the Commission's rules and forms and that the information
required to be disclosed by the registrant has been accumulated and communicated
to the registrant's principal executive officer and principal financial officer
in order to allow timely decisions regarding required disclosure.
(b) There have been no changes in the registrant's internal controls over
financial reporting during the period that has materially affected, or is
reasonably likely to materially affect the registrant's internal control over
financial reporting.
ITEM 11. EXHIBITS
(a)(1) Registrant's Code of Ethics - Not applicable (please see Item 2).
(a)(2)(i) Treasurer's Section 302 certification.
(a)(2)(ii) President's Section 302 certification.
(b) Combined Section 906 certification.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
EATON VANCE INSURED MICHIGAN MUNICIPAL BOND FUND
By: /S/ Thomas J. Fetter
--------------------
Thomas J. Fetter
President
Date: May 20, 2004
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /S/ James L. O'Connor
---------------------
James L. O'Connor
Treasurer
Date: May 20, 2004
By: /S/ Thomas J. Fetter
--------------------
Thomas J. Fetter
President
Date: May 20, 2004
ITEM 2. CODE OF ETHICS
The registrant has adopted a code of ethics applicable to its Principal
Executive Officer, Principal Financial Officer and Principal Accounting Officer.
The registrant undertakes to provide a copy of such code of ethics to any person
upon request, without charge, by calling 1-800-262-1122.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT
The registrant's Board has designated William H. Park, Samuel L. Hayes, III and
Norton H. Reamer, each an independent trustee, as its audit committee financial
experts. Mr. Park is a certified public accountant who is the President and
Chief Executive Officer of Prizm Capital Management, LLC (investment management
firm). Previously, he served as Executive Vice President and Chief Financial
Officer of United Asset Management Corporation ("UAM") (a holding company owning
institutional investment management firms). Mr. Hayes is the Jacob H. Schiff
Professor of Investment Banking Emeritus of the Harvard University Graduate
School of Business Administration. Mr. Reamer is the President, Chief Executive
Officer and a Director of Asset Management Finance Corp. (a specialty finance
company serving the investment management industry) and is President of Unicorn
Corporation (an investment and financial advisory services company). Formerly,
Mr. Reamer was Chairman of Hellman, Jordan Management Co., Inc. (an investment
management company) and Advisory Director of Berkshire Capital Corporation (an
investment banking firm), Chairman of the Board of UAM and Chairman, President
and Director of the UAM Funds (mutual funds).
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Not required in this filing
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Not required in this filing.
ITEM 6. SCHEDULE OF INVESTMENTS
Please see schedule of investments contained in the Report to Stockholders
included under Item 1 of this Form N-CSR.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES
The Board of Trustees of the Trust has adopted a proxy voting policy and
procedure (the "Fund Policy"), pursuant to which the Trustees have delegated
proxy voting responsibility to the Fund's investment adviser and adopted the
investment adviser's proxy voting policies and procedures (the "Policies") which
are described below. The Trustees will review the Fund's proxy voting records
from time to time and will annually consider approving the Policies for the
upcoming year. In the event that a conflict of interest arises between the
Fund's shareholders and the investment adviser, the administrator, or any of
their affiliates or any affiliate of the Fund, the investment adviser will
generally refrain from voting the proxies related to the companies giving rise
to such conflict until it consults with the Board of the Fund except as
contemplated under the Fund Policy. The Board's Special Committee will instruct
the investment adviser on the appropriate course of action.
The Policies are designed to promote accountability of a company's management to
its shareholders and to align the interests of management with those
shareholders. The investment adviser will generally support company management
on proposals relating to environmental and social policy issues and on matters
regarding the state of organization of the company. On all other matters, the
investment adviser will take management's proposals under advisement but will
consider each matter in light of the guidelines set forth in the Policies.
Except in the instance of routine matters related to corporate administration
which are not expected to have a significant economic impact on the company or
its shareholders (on which the investment adviser will routinely vote with
management), the investment adviser will review each matter on a case-by-case
basis and reserves the right to deviate from the Policies guidelines when it
believes the situation warrants such a deviation. The Policy includes voting
guidelines for matters relating to, among other things, the election of
directors, approval of independent auditors, executive compensation, corporate
structure and anti-takeover defenses. The investment adviser may abstain from
voting from time to time where it determines that the costs associated with
voting a proxy outweighs the benefits derived from exercising the right to vote.
In addition, the investment adviser will monitor situations that may result in a
conflict of interest between the Fund's shareholders and the investment adviser,
the administrator, or any of their affiliates or any affiliate of the Fund by
maintaining a list of significant existing and prospective corporate clients.
The investment adviser's personnel responsible for reviewing and voting proxies
on behalf of the Fund will report any proxy received or expected to be received
from a company included on that list to the investment adviser's general counsel
or chief equity investment officer. The general counsel or chief equity
investment officer will determine if a conflict exists. If a conflict does
exist, the proxy will either be voted strictly in accordance with the Policy or
the investment adviser will seek instruction on how to vote from the Board.
Effective August 31, 2004, information on how the Fund voted proxies relating to
portfolio securities during the 12 month period ended June 30, 2004 [is/will be]
available (1) without charge, upon request, by calling 1-800-262-1122, and (2)
on the Securities and Exchange Commission's website at http://www.sec.gov.
ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not required in this filing.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Effective February 9, 2004, the Governance Committee of the Board of Trustees
formalized the procedures by which a Fund's shareholders may recommend nominees
to the registrant's Board of Trustees. The Governance Committee shall, when
identifying candidates for the position of Independent Trustee, consider any
such candidate recommended by a shareholder of a Fund if such recommendation
contains sufficient background information concerning the candidate, and is
received in a sufficiently timely manner (and in any event no later than the
date specified for receipt of shareholder proposals in any applicable proxy
statement with respect to a Fund). Shareholders shall be directed to address any
such recommendations to the attention of the Governance Committee, c/o the
Secretary of the Fund.
ITEM 10. CONTROLS AND PROCEDURES
(a) It is the conclusion of the registrant's principal executive officer and
principal financial officer that the effectiveness of the registrant's current
disclosure controls and procedures (such disclosure controls and procedures
having been evaluated within 90 days of the date of this filing) provide
reasonable assurance that the information required to be disclosed by the
registrant has been recorded, processed, summarized and reported within the time
period specified in the Commission's rules and forms and that the information
required to be disclosed by the registrant has been accumulated and communicated
to the registrant's principal executive officer and principal financial officer
in order to allow timely decisions regarding required disclosure.
(b) There have been no changes in the registrant's internal controls over
financial reporting during the period that has materially affected, or is
reasonably likely to materially affect the registrant's internal control over
financial reporting.
ITEM 11. EXHIBITS
(a)(1) Registrant's Code of Ethics - Not applicable (please see Item 2).
(a)(2)(i) Treasurer's Section 302 certification.
(a)(2)(ii) President's Section 302 certification.
(b) Combined Section 906 certification.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
EATON VANCE INSURED NEW JERSEY MUNICIPAL BOND FUND
By: S/ Thomas J. Fetter
-------------------
Thomas J. Fetter
President
Date: May 20, 2004
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /S/ James L. O'Connor
---------------------
James L. O'Connor
Treasurer
Date: May 20, 2004
By: /S/ Thomas J. Fetter
--------------------
Thomas J. Fetter
President
Date: May 20, 2004
ITEM 2. CODE OF ETHICS
The registrant has adopted a code of ethics applicable to its Principal
Executive Officer, Principal Financial Officer and Principal Accounting Officer.
The registrant undertakes to provide a copy of such code of ethics to any person
upon request, without charge, by calling 1-800-262-1122.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT
The registrant's Board has designated William H. Park, Samuel L. Hayes, III and
Norton H. Reamer, each an independent trustee, as its audit committee financial
experts. Mr. Park is a certified public accountant who is the President and
Chief Executive Officer of Prizm Capital Management, LLC (investment management
firm). Previously, he served as Executive Vice President and Chief Financial
Officer of United Asset Management Corporation ("UAM") (a holding company owning
institutional investment management firms). Mr. Hayes is the Jacob H. Schiff
Professor of Investment Banking Emeritus of the Harvard University Graduate
School of Business Administration. Mr. Reamer is the President, Chief Executive
Officer and a Director of Asset Management Finance Corp. (a specialty finance
company serving the investment management industry) and is President of Unicorn
Corporation (an investment and financial advisory services company). Formerly,
Mr. Reamer was Chairman of Hellman, Jordan Management Co., Inc. (an investment
management company) and Advisory Director of Berkshire Capital Corporation (an
investment banking firm), Chairman of the Board of UAM and Chairman, President
and Director of the UAM Funds (mutual funds).
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Not required in this filing
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Not required in this filing.
ITEM 6. SCHEDULE OF INVESTMENTS
Please see schedule of investments contained in the Report to Stockholders
included under Item 1 of this Form N-CSR.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES
The Board of Trustees of the Trust has adopted a proxy voting policy and
procedure (the "Fund Policy"), pursuant to which the Trustees have delegated
proxy voting responsibility to the Fund's investment adviser and adopted the
investment adviser's proxy voting policies and procedures (the "Policies") which
are described below. The Trustees will review the Fund's proxy voting records
from time to time and will annually consider approving the Policies for the
upcoming year. In the event that a conflict of interest arises between the
Fund's shareholders and the investment adviser, the administrator, or any of
their affiliates or any affiliate of the Fund, the investment adviser will
generally refrain from voting the proxies related to the companies giving rise
to such conflict until it consults with the Board of the Fund except as
contemplated under the Fund Policy. The Board's Special Committee will instruct
the investment adviser on the appropriate course of action.
The Policies are designed to promote accountability of a company's management to
its shareholders and to align the interests of management with those
shareholders. The investment adviser will generally support company management
on proposals relating to environmental and social policy issues and on matters
regarding the state of organization of the company. On all other matters, the
investment adviser will take management's proposals under advisement but will
consider each matter in light of the guidelines set forth in the Policies.
Except in the instance of routine matters related to corporate administration
which are not expected to have a significant economic impact on the company or
its shareholders (on which the investment adviser will routinely vote with
management), the investment adviser will review each matter on a case-by-case
basis and reserves the right to deviate from the Policies guidelines when it
believes the situation warrants such a deviation. The Policy includes voting
guidelines for matters relating to, among other things, the election of
directors, approval of independent auditors, executive compensation, corporate
structure and anti-takeover defenses. The investment adviser may abstain from
voting from time to time where it determines that the costs associated with
voting a proxy outweighs the benefits derived from exercising the right to vote.
In addition, the investment adviser will monitor situations that may result in a
conflict of interest between the Fund's shareholders and the investment adviser,
the administrator, or any of their affiliates or any affiliate of the Fund by
maintaining a list of significant existing and prospective corporate clients.
The investment adviser's personnel responsible for reviewing and voting proxies
on behalf of the Fund will report any proxy received or expected to be received
from a company included on that list to the investment adviser's general counsel
or chief equity investment officer. The general counsel or chief equity
investment officer will determine if a conflict exists. If a conflict does
exist, the proxy will either be voted strictly in accordance with the Policy or
the investment adviser will seek instruction on how to vote from the Board.
Effective August 31, 2004, information on how the Fund voted proxies relating to
portfolio securities during the 12 month period ended June 30, 2004 [is/will be]
available (1) without charge, upon request, by calling 1-800-262-1122, and (2)
on the Securities and Exchange Commission's website at http://www.sec.gov.
ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not required in this filing.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Effective February 9, 2004, the Governance Committee of the Board of Trustees
formalized the procedures by which a Fund's shareholders may recommend nominees
to the registrant's Board of Trustees. The Governance Committee shall, when
identifying candidates for the position of Independent Trustee, consider any
such candidate recommended by a shareholder of a Fund if such recommendation
contains sufficient background information concerning the candidate, and is
received in a sufficiently timely manner (and in any event no later than the
date specified for receipt of shareholder proposals in any applicable proxy
statement with respect to a Fund). Shareholders shall be directed to address any
such recommendations to the attention of the Governance Committee, c/o the
Secretary of the Fund.
ITEM 10. CONTROLS AND PROCEDURES
(a) It is the conclusion of the registrant's principal executive officer and
principal financial officer that the effectiveness of the registrant's current
disclosure controls and procedures (such disclosure controls and procedures
having been evaluated within 90 days of the date of this filing) provide
reasonable assurance that the information required to be disclosed by the
registrant has been recorded, processed, summarized and reported within the time
period specified in the Commission's rules and forms and that the information
required to be disclosed by the registrant has been accumulated and communicated
to the registrant's principal executive officer and principal financial officer
in order to allow timely decisions regarding required disclosure.
(b) There have been no changes in the registrant's internal controls over
financial reporting during the period that has materially affected, or is
reasonably likely to materially affect the registrant's internal control over
financial reporting.
ITEM 11. EXHIBITS
(a)(1) Registrant's Code of Ethics - Not applicable (please see Item 2).
(a)(2)(i) Treasurer's Section 302 certification.
(a)(2)(ii) President's Section 302 certification.
(b) Combined Section 906 certification.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
EATON VANCE INSURED NEW YORK MUNICIPAL BOND FUND II
By: /s/ Thomas J. Fetter
-------------------------------------------
Thomas J. Fetter
President
Date: May 20, 2004
------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ James L. O'Connor
-------------------------------------------
James L. O'Connor
Treasurer
Date: May 20, 2004
------------
By: /s/ Thomas J. Fetter
--------------------------------------------------
Thomas J. Fetter
President
Date: May 20, 2004
------------
ITEM 2. CODE OF ETHICS
The registrant has adopted a code of ethics applicable to its Principal
Executive Officer, Principal Financial Officer and Principal Accounting Officer.
The registrant undertakes to provide a copy of such code of ethics to any person
upon request, without charge, by calling 1-800-262-1122.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT
The registrant's Board has designated William H. Park, Samuel L. Hayes, III and
Norton H. Reamer, each an independent trustee, as its audit committee financial
experts. Mr. Park is a certified public accountant who is the President and
Chief Executive Officer of Prizm Capital Management, LLC (investment management
firm). Previously, he served as Executive Vice President and Chief Financial
Officer of United Asset Management Corporation ("UAM") (a holding company owning
institutional investment management firms). Mr. Hayes is the Jacob H. Schiff
Professor of Investment Banking Emeritus of the Harvard University Graduate
School of Business Administration. Mr. Reamer is the President, Chief Executive
Officer and a Director of Asset Management Finance Corp. (a specialty finance
company serving the investment management industry) and is President of Unicorn
Corporation (an investment and financial advisory services company). Formerly,
Mr. Reamer was Chairman of Hellman, Jordan Management Co., Inc. (an investment
management company) and Advisory Director of Berkshire Capital Corporation (an
investment banking firm), Chairman of the Board of UAM and Chairman, President
and Director of the UAM Funds (mutual funds).
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Not required in this filing
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Not required in this filing.
ITEM 6. SCHEDULE OF INVESTMENTS
Please see schedule of investments contained in the Report to Stockholders
included under Item 1 of this Form N-CSR.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES
The Board of Trustees of the Trust has adopted a proxy voting policy and
procedure (the "Fund Policy"), pursuant to which the Trustees have delegated
proxy voting responsibility to the Fund's investment adviser and adopted the
investment adviser's proxy voting policies and procedures (the "Policies") which
are described below. The Trustees will review the Fund's proxy voting records
from time to time and will annually consider approving the Policies for the
upcoming year. In the event that a conflict of interest arises between the
Fund's shareholders and the investment adviser, the administrator, or any of
their affiliates or any affiliate of the Fund, the investment adviser will
generally refrain from voting the proxies related to the companies giving rise
to such conflict until it consults with the Board of the Fund except as
contemplated under the Fund Policy. The Board's Special Committee will instruct
the investment adviser on the appropriate course of action.
The Policies are designed to promote accountability of a company's management to
its shareholders and to align the interests of management with those
shareholders. The investment adviser will generally support company management
on proposals relating to environmental and social policy issues and on matters
regarding the state of organization of the company. On all other matters, the
investment adviser will take management's proposals under advisement but will
consider each matter in light of the guidelines set forth in the Policies.
Except in the instance of routine matters related to corporate administration
which are not expected to have a significant economic impact on the company or
its shareholders (on which the investment adviser will routinely vote with
management), the investment adviser will review each matter on a case-by-case
basis and reserves the right to deviate from the Policies guidelines when it
believes the situation warrants such a deviation. The Policy includes voting
guidelines for matters relating to, among other things, the election of
directors, approval of independent auditors, executive compensation, corporate
structure and anti-takeover defenses. The investment adviser may abstain from
voting from time to time where it determines that the costs associated with
voting a proxy outweighs the benefits derived from exercising the right to vote.
In addition, the investment adviser will monitor situations that may result in a
conflict of interest between the Fund's shareholders and the investment adviser,
the administrator, or any of their affiliates or any affiliate of the Fund by
maintaining a list of significant existing and prospective corporate clients.
The investment adviser's personnel responsible for reviewing and voting proxies
on behalf of the Fund will report any proxy received or expected to be received
from a company included on that list to the investment adviser's general counsel
or chief equity investment officer. The general counsel or chief equity
investment officer will determine if a conflict exists. If a conflict does
exist, the proxy will either be voted strictly in accordance with the Policy or
the investment adviser will seek instruction on how to vote from the Board.
Effective August 31, 2004, information on how the Fund voted proxies relating to
portfolio securities during the 12 month period ended June 30, 2004 [is/will be]
available (1) without charge, upon request, by calling 1-800-262-1122, and (2)
on the Securities and Exchange Commission's website at http://www.sec.gov.
ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not required in this filing.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Effective February 9, 2004, the Governance Committee of the Board of Trustees
formalized the procedures by which a Fund's shareholders may recommend nominees
to the registrant's Board of Trustees. The Governance Committee shall, when
identifying candidates for the position of Independent Trustee, consider any
such candidate recommended by a shareholder of a Fund if such recommendation
contains sufficient background information concerning the candidate, and is
received in a sufficiently timely manner (and in any event no later than the
date specified for receipt of shareholder proposals in any applicable proxy
statement with respect to a Fund). Shareholders shall be directed to address any
such recommendations to the attention of the Governance Committee, c/o the
Secretary of the Fund.
ITEM 10. CONTROLS AND PROCEDURES
(a) It is the conclusion of the registrant's principal executive officer and
principal financial officer that the effectiveness of the registrant's current
disclosure controls and procedures (such disclosure controls and procedures
having been evaluated within 90 days of the date of this filing) provide
reasonable assurance that the information required to be disclosed by the
registrant has been recorded, processed, summarized and reported within the time
period specified in the Commission's rules and forms and that the information
required to be disclosed by the registrant has been accumulated and communicated
to the registrant's principal executive officer and principal financial officer
in order to allow timely decisions regarding required disclosure.
(b) There have been no changes in the registrant's internal controls over
financial reporting during the period that has materially affected, or is
reasonably likely to materially affect the registrant's internal control over
financial reporting.
ITEM 11. EXHIBITS
(a)(1) Registrant's Code of Ethics - Not applicable (please see Item 2).
(a)(2)(i) Treasurer's Section 302 certification.
(a)(2)(ii) President's Section 302 certification.
(b) Combined Section 906 certification.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
EATON VANCE INSURED OHIO MUNICIPAL BOND FUND
By: /s/ Thomas J. Fetter
--------------------
Thomas J. Fetter
President
Date: May 20, 2004
------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ James L. O'Connor
---------------------
James L. O'Connor
Treasurer
Date: May 20, 2004
------------
By: /s/ Thomas J. Fetter
--------------------
Thomas J. Fetter
President
Date: May 20, 2004
------------
ITEM 2. CODE OF ETHICS
The registrant has adopted a code of ethics applicable to its Principal
Executive Officer, Principal Financial Officer and Principal Accounting Officer.
The registrant undertakes to provide a copy of such code of ethics to any person
upon request, without charge, by calling 1-800-262-1122.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT
The registrant's Board has designated William H. Park, Samuel L. Hayes, III and
Norton H. Reamer, each an independent trustee, as its audit committee financial
experts. Mr. Park is a certified public accountant who is the President and
Chief Executive Officer of Prizm Capital Management, LLC (investment management
firm). Previously, he served as Executive Vice President and Chief Financial
Officer of United Asset Management Corporation ("UAM") (a holding company owning
institutional investment management firms). Mr. Hayes is the Jacob H. Schiff
Professor of Investment Banking Emeritus of the Harvard University Graduate
School of Business Administration. Mr. Reamer is the President, Chief Executive
Officer and a Director of Asset Management Finance Corp. (a specialty finance
company serving the investment management industry) and is President of Unicorn
Corporation (an investment and financial advisory services company). Formerly,
Mr. Reamer was Chairman of Hellman, Jordan Management Co., Inc. (an investment
management company) and Advisory Director of Berkshire Capital Corporation (an
investment banking firm), Chairman of the Board of UAM and Chairman, President
and Director of the UAM Funds (mutual funds).
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Not required in this filing
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Not required in this filing.
ITEM 6. SCHEDULE OF INVESTMENTS
Please see schedule of investments contained in the Report to Stockholders
included under Item 1 of this Form N-CSR.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES
The Board of Trustees of the Trust has adopted a proxy voting policy and
procedure (the "Fund Policy"), pursuant to which the Trustees have delegated
proxy voting responsibility to the Fund's investment adviser and adopted the
investment adviser's proxy voting policies and procedures (the "Policies") which
are described below. The Trustees will review the Fund's proxy voting records
from time to time and will annually consider approving the Policies for the
upcoming year. In the event that a conflict of interest arises between the
Fund's shareholders and the investment adviser, the administrator, or any of
their affiliates or any affiliate of the Fund, the investment adviser will
generally refrain from voting the proxies related to the companies giving rise
to such conflict until it consults with the Board of the Fund except as
contemplated under the Fund Policy. The Board's Special Committee will instruct
the investment adviser on the appropriate course of action.
The Policies are designed to promote accountability of a company's management to
its shareholders and to align the interests of management with those
shareholders. The investment adviser will generally support company management
on proposals relating to environmental and social policy issues and on matters
regarding the state of organization of the company. On all other matters, the
investment adviser will take management's proposals under advisement but will
consider each matter in light of the guidelines set forth in the Policies.
Except in the instance of routine matters related to corporate administration
which are not expected to have a significant economic impact on the company or
its shareholders (on which the investment adviser will routinely vote with
management), the investment adviser will review each matter on a case-by-case
basis and reserves the right to deviate from the Policies guidelines when it
believes the situation warrants such a deviation. The Policy includes voting
guidelines for matters relating to, among other things, the election of
directors, approval of independent auditors, executive compensation, corporate
structure and anti-takeover defenses. The investment adviser may abstain from
voting from time to time where it determines that the costs associated with
voting a proxy outweighs the benefits derived from exercising the right to vote.
In addition, the investment adviser will monitor situations that may result in a
conflict of interest between the Fund's shareholders and the investment adviser,
the administrator, or any of their affiliates or any affiliate of the Fund by
maintaining a list of significant existing and prospective corporate clients.
The investment adviser's personnel responsible for reviewing and voting proxies
on behalf of the Fund will report any proxy received or expected to be received
from a company included on that list to the investment adviser's general counsel
or chief equity investment officer. The general counsel or chief equity
investment officer will determine if a conflict exists. If a conflict does
exist, the proxy will either be voted strictly in accordance with the Policy or
the investment adviser will seek instruction on how to vote from the Board.
Effective August 31, 2004, information on how the Fund voted proxies relating to
portfolio securities during the 12 month period ended June 30, 2004 [is/will be]
available (1) without charge, upon request, by calling 1-800-262-1122, and (2)
on the Securities and Exchange Commission's website at http://www.sec.gov.
ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not required in this filing.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Effective February 9, 2004, the Governance Committee of the Board of Trustees
formalized the procedures by which a Fund's shareholders may recommend nominees
to the registrant's Board of Trustees. The Governance Committee shall, when
identifying candidates for the position of Independent Trustee, consider any
such candidate recommended by a shareholder of a Fund if such recommendation
contains sufficient background information concerning the candidate, and is
received in a sufficiently timely manner (and in any event no later than the
date specified for receipt of shareholder proposals in any applicable proxy
statement with respect to a Fund). Shareholders shall be directed to address any
such recommendations to the attention of the Governance Committee, c/o the
Secretary of the Fund.
ITEM 10. CONTROLS AND PROCEDURES
(a) It is the conclusion of the registrant's principal executive officer and
principal financial officer that the effectiveness of the registrant's current
disclosure controls and procedures (such disclosure controls and procedures
having been evaluated within 90 days of the date of this filing) provide
reasonable assurance that the information required to be disclosed by the
registrant has been recorded, processed, summarized and reported within the time
period specified in the Commission's rules and forms and that the information
required to be disclosed by the registrant has been accumulated and communicated
to the registrant's principal executive officer and principal financial officer
in order to allow timely decisions regarding required disclosure.
(b) There have been no changes in the registrant's internal controls over
financial reporting during the period that has materially affected, or is
reasonably likely to materially affect the registrant's internal control over
financial reporting.
ITEM 11. EXHIBITS
(a)(1) Registrant's Code of Ethics - Not applicable (please see Item 2).
(a)(2)(i) Treasurer's Section 302 certification.
(a)(2)(ii) President's Section 302 certification.
(b) Combined Section 906 certification.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
EATON VANCE INSURED PENNSYLVANIA MUNICIPAL BOND FUND
By: /S/ Thomas J. Fetter
--------------------
Thomas J. Fetter
President
Date: May 20, 2004
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /S/ James L. O'Connor
---------------------
James L. O'Connor
Treasurer
Date: May 20, 2004
By: /S/ Thomas J. Fetter
--------------------
Thomas J. Fetter
President
Date: May 20, 2004