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: 811-10045
CALVERT IMPACT FUND
(Exact name of registrant as specified in charter)
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
(Address of Principal Executive Offices)
William M. Tartikoff, Esq.
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
(Name and Address of Agent for Service)
Registrant's telephone number, including area code: (301) 951-4800
Date of fiscal year end: September 30
Date of reporting period: Twelve months ended September 30, 2003
<PAGE>
Item 1. Report to Stockholders.
Calvert
Investments that make a difference(registered trademark)
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September 30, 2003
Annual Report
Calvert Large Cap
Growth Fund
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Table of Contents
President's Letter
1
Social Update
3
Portfolio Management Discussion
4
Independent Auditors' Report
8
Schedule of Investments
9
Statement of Assets and Liabilities
13
Statement of Operations
14
Statements of Changes in Net Assets
15
Notes to Financial Statements
16
Financial Highlights
20
Explanation of Financial Tables
24
Director and Officer Information Table
26
Dear Shareholders:
The markets have improved dramatically over the past year, with stocks showing substantial gains and bonds continuing to profit from an historically low interest-rate environment.
We believe that this year's broad-based market turnaround illustrates once again the value of diversification, asset allocation and long-term investing. Many investors who pursued an appropriate asset allocation, with investments in stocks, bonds and cash, were able to benefit from the rally in securities prices. Those who paid too much attention to short-term past performance and substantially reduced their stock holdings early in the year may well have missed the sharp rallies in the second quarter. At Calvert, we encourage all our shareholders to review their portfolios with their financial advisors to ensure that their investments remain in line with their specific risk tolerance, return expectations and financial goals.
A cloud on the otherwise bright performance of the markets and economy was the distressing news concerning recent market timing and illegal after-hours trading on the part of certain mutual funds. We want to assure Calvert shareholders that we have a long-standing policy of not accepting trades from market timers, which is strictly enforced. And, of course, we do not accept or execute trades after the market closes, which would be in violation of securities industry regulations.
Markets like the ones that we have seen over the past several years demonstrate that understanding risk -- at the security, fund, and asset-class level -- is an integral part of successful investing. This year, we have taken a number of steps to improve our ability to monitor and manage risk, and to prepare for further growth in our investor base. We have reorganized Calvert's investment activities into two departments, Equities and Fixed Income, each headed by Chief Investment Officers who will work closely with our Social Research Department. We believe that these changes will enhance our ability to deliver top-tier investment performance to our shareholders, while keeping investment risk at appropriate levels.
Thank you for your continued business, and we look forward to serving you in the year ahead.
Sincerely,
/s/Barbara J. Krumsiek
President and CEO
Calvert Asset Management Company, Inc.
November 2003
Social Update
from the Calvert Social Research Department
Shareholder Activism
Calvert shareholder activism seeks to move companies already performing in a more socially responsible manner than their industry peers to a higher level of corporate responsibility. We've secured the agreement of two major pharmaceutical companies to amend and post their ethical policies for clinical research in developing countries, where people are often not provided adequate information about the risks of clinical research or are promised but not given health care in exchange for their participation in trials for new drugs.
In addition, our shareholder resolution effectiveness for our various Calvert Funds has increased as we've become more effective in positioning our point of view in the context of shareholders' financial interests. For example, we received 12% support on a resolution seeking inclusive diversity policies at Alltel Corporation and a remarkable 63% on a resolution for staggered board tenures at Gillette.
Corporate "dialogues" continue, including a current effort with Weyerhaeuser to establish a policy prohibiting the harvest of and trade in products from primary and old-growth forests.
Board Diversity Initiative Successes
Two companies held in Calvert Funds have agreed to adopt key language from Calvert's model board diversity charter, which reflects our belief that boards of directors should look like America, not just a small slice of it.
Social Policy Leadership Announced
Calvert has named Joe Keefe Senior Advisor for Strategic Social Policy. Mr. Keefe, who has worked for and consulted with several socially responsible mutual fund groups, will provide focused, proactive direction for our social vision.
Portfolio Management Discussion
John Montgomery
of Bridgeway Capital Management
Performance
Calvert Large Cap Growth Fund Class A shares returned 29.78% in fiscal year 2003, leading both the S&P 500 Index at 24.37%, and other multi-cap growth funds (Lipper category average, 28.65%). Last year at this time we were reporting healthy relative-market-beating performance, as our fund was down only 15.32% for fiscal year 2002 compared to the S&P 500 Index, which was down 20.47%.
The following table presents Calvert Large Cap Growth Fund Class A shares' performance (total return at NAV) for various time horizons through September 30, 2003.**
| Calvert Large Cap | Lipper Multi-Cap | S&P 500 | |||||||||
Growth Fund | Growth Funds Avg. | Index | ||||||||||
1 quarter | 5.66% | 4.84% | 2.65% | |||||||||
1 year | 29.78% | 28.65% | 24.37% | |||||||||
3 years | -12.94% | -20.05% | -10.13% | |||||||||
5 years | 4.68% | 1.65% | 1.00% | |||||||||
Since inception | ||||||||||||
(8/31/94)*** | 10.71% | 8.65% | 10.37% |
**Pursuant to the Agreement and Plan of Reorganization, the Social Responsibility Portfolio of Bridgeway Fund, Inc. ("Bridgeway") was reorganized into the Class I Shares of the Calvert Large Cap Growth Fund, which commenced operations on 10/31/00. The performance results prior to 10/31/00 for Class A Shares and Class I Shares of the Calvert Large Cap Growth Fund reflect the performance of Bridgeway. Past performance is no guarantee of future results.
*** The month-end date of 8/31/94 is used for comparison purposes only; actual Fund inception is 8/5/94.
Portfolio Statistics
September 30, 2003
Investment Performance
(total return at NAV)
6 Months | 12 Months | |||||||
ended | ended | |||||||
9/30/03 | 9/30/03 | |||||||
Class A | 21.98% | 29.78% | ||||||
Class B | 21.37% | 28.45% | ||||||
Class C | 21.40% | 28.53% | ||||||
Class I | 22.35% | 30.54% | ||||||
S&P 500 Index* | 18.44% | 24.37% | ||||||
Lipper Multi-Cap Growth Funds Avg.* | 22.64% | 28.65% |
Asset Allocation
Stocks | 95% | |||
Cash or Cash Equivalents | 5% | |||
Total | 100% |
Past performance is no guarantee of future results.
Investment performance does not reflect the deduction of any front-end or deferred sales charge.
* Source: Lipper Analytical Services, Inc.
Investment Climate
After three-years of relative poor performance, the broader market as represented by the S&P 500 Index returned 24.4% for the Fund's fiscal year, more than double the long-term historical average. What started out as a continuation of one of the worst ongoing bear markets since the Great Depression turned into a year of positive up-ticks and renewed investor confidence.
Starting in the fourth quarter 2002, investment dollars began moving back into equities. In this environment, Technology, Health Care, and Financial Services resurfaced as some of the top-performing industries for the year.
Portfolio Strategy
What Worked in 2003
Our focus on growth stocks and large stocks helped our performance relative to the overall market, as did simply being fully invested before and during this new bull market. Likewise, our overweighting in Communications, Health Care, and Financial Services helped. In spite of the Internet rout of 2000-2002, much of which we sidestepped, our top three performers for the year were from this industry, including Amazon.com and eBay.
Our ten best-performing stocks for the year were:
Rank | Company | Industry | % Appreciation | |||||||||
1 | J2 Global Com Inc. | Internet | 198.4% | |||||||||
2 | Amazon.com Inc. | Internet | 153.5% | |||||||||
3 | eBay Inc. | Internet | 95.3% | |||||||||
4 | Nextel Communications Inc. | Telecommunications | 94.0% | |||||||||
5 | E*Trade Group Inc. | Financial Services | 54.3% | |||||||||
6 | Family Dollar Stores | Retail | 52.5% | |||||||||
7 | Western Digital Corp. | Computers | 51.6% | |||||||||
8 | Nortel Networks Corp. | Telecommunications | 47.9% | |||||||||
9 | Utstarcom Inc. | Telecommunications | 45.4% | |||||||||
10 | Gilead Science Inc. | Pharmaceuticals | 44.6% |
What Didn't Work in 2003
Our worst-performing stock for the year was PEC Solutions, a stock that unfortunately plummeted 61% during the March quarter. PEC Solutions helps government agencies utilize the Internet for improved efficiency and public access. During the shaky wartime environment at the start of this calendar year, the stock price quickly dropped, impacting our overall March quarter performance by - -1.3%. By fiscal-year end, we had divested each of our worst performers for 2003. By sector, the biggest annual declines belonged to the duo of Technology and Consumer Cyclicals.
Our ten worst-performing stocks for the year were:
Rank | Company | Industry | % Decline | |||||||||
1 | PEC Solutions Inc. | Computers | 62.0% | |||||||||
2 | Laboratory Corp. of America Holdings | Healthcare-Products | 60.4% | |||||||||
3 | Sony Corporation ADR | Home Furnishings | 47.0% | |||||||||
4 | Qualcomm Inc. | Telecommunications | 46.2% | |||||||||
5 | MBNA Corp. | Diversified Financial Services | 38.8% | |||||||||
6 | Intuit Inc. | Software | 34.9% | |||||||||
7 | Movie Gallery Inc. | Retail | 27.5% | |||||||||
8 | Patterson Dental Co. | Healthcare-Products | 27.5% | |||||||||
9 | Kohl's Corp. | Retail | 26.8% | |||||||||
10 | The Bombay Co. Inc. | Retail | 26.2% |
Outlook
Over this last year, our nation's economy has withstood the impact of war, recession, and corporate greed. Bridgeway's investment process, guided by emotion-free decision making, held strong as we remained fully invested. While I remain concerned about problems and crises nationally and internationally, I am optimistic about our nation's ability to move in a positive direction. This last year has also seen a wave of industry changes which we hope will lead to improved investor wealth and justice. Socially screened funds and shareholder activism continue to play an important role.
The stock market rebounded out of the three-year-long bear market from 1939-1941, and we seem to be on the same track after the worst bear market since that time (2000-2002). Following three years of negative annual returns, 1942 resulted in a greater than 20% total return, just as our fiscal year 2003 resulted in a 24.4% total market (S&P 500) return. I continue to believe that the best investment strategy includes diversification, a long-term plan, and the discipline to carry it out. I'm honored to be a part of that strategy in your overall plan.
November 2003
Portfolio Statistics
September 30, 2003
Average Annual Total Returns
(with max. load)
Class A Shares | ||||
One year | 23.62% | |||
Five year | 3.67% | |||
Since inception | 10.84% | |||
(8/5/94) | ||||
Class B Shares | ||||
One year | 23.45% | |||
Since inception | (13.32%) | |||
(10/31/00) | ||||
Class C Shares | ||||
One year | 27.53% | |||
Since inception | (11.97%) | |||
(10/31/00) | ||||
Class I Shares | ||||
One year | 30.54% | |||
Five year | 5.05% | |||
Since inception | 11.64% | |||
(8/5/94) |
Ten Largest Stock Holdings
% of Net Assets | ||||
Nextel Communications, Inc. | 4.4% | |||
SanDisk Corp. | 4.2% | |||
j2 Global Communications, Inc. | 2.6% | |||
SLM Corp. | 2.5% | |||
Progressive Corp. | 2.4% | |||
Foundry Networks, Inc. | 2.2% | |||
Best Buy Co., Inc. | 2.2% | |||
Career Education Corp. | 2.1% | |||
E*trade Financial Corp. | 2.1% | |||
Gilead Sciences, Inc. | 2.1% | |||
Total | 26.8% |
Pursuant to the Agreement and Plan of Reorganization, the Social Responsibility Portfolio of Bridgeway Fund, Inc. ("Bridgeway") was reorganized into the Class I Shares of the Calvert Large Cap Growth Fund, which commenced operations on 10/31/00. The performance results prior to 10/31/00 for Class A Shares and Class I Shares of the Calvert Large Cap Growth Fund reflect the performance of Bridgeway. Past performance is no guarantee of future results.
Performance Comparison
Comparison of change in value of $10,000 investment. (Source: Lipper Analytical Services, Inc.)
[INSERT LARGE CAP LINE GRAPH HERE]
Average annual total returns in the Portfolio Statistics above and the Performance Comparison line graph are with maximum load deducted -- they assume reinvestment of dividends and reflect the deduction of the Fund's maximum front-end or deferred sales charge. No sales charge has been applied to the index used for comparison. The value of an investment in Class A & Class I shares is plotted in the line graph. The value of an investment in another class of shares would be different depending on sales charges and expenses. The graph and table do not reflect the deduction of taxes that a shareholder would pay on the Fund's distributions or the redemption of Fund shares. The month-end date of 8/31/94 is used for comparison purposes only; actual Fund inception is 8/5/94. Past performance is no guarantee of future results.
Independent Auditors' Report
To the Board of Directors of Calvert Impact Fund, Inc. and
Shareholders of Calvert Large Cap Growth Fund:
We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Calvert Large Cap Growth Fund (the "Fund"), a series of Calvert Impact Fund, Inc., as of September 30, 2003, and the related statement of operations for the year then ended, the statements of changes in net assets and the financial highlights for each of the two years in the period then ended. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The financial highlights for the periods ended September 30, 2001 and June 30, 2001, were audited by other auditors who have ceased operations. Those auditors expressed an unqualified opinion on those financial statements in their report dated November 16, 2001. The financial highlights for the periods presented prior to June 30, 2001, were audited by other auditors, whose report dated August 16, 2000, expressed an unqualified opinion on those statements.
We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of September 30, 2003, by correspondence with the custodian and brokers or by other appropriate auditing procedures where replies from brokers were not received. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Calvert Large Cap Growth Fund as of September 30, 2003, the results of its operations for the year then ended, the changes in its net assets and the financial highlights for each of the two years in the period then ended, in conformity with accounting principles generally accepted in the United States America.
KPMG LLP
Philadelphia, Pennsylvania
November 18, 2003
Schedule of Investments
September 30, 2003
Equity Securities - 99.2% | Shares | Value | |||
Banks - Major Regional - 3.7% | |||||
FleetBoston Financial Corp. | 16,000 | $482,400 | |||
SouthTrust Corp. | 10,700 | 314,473 | |||
US Bancorp | 12,400 | 297,476 | |||
| 1,094,349 | ||||
Biotechnology - 5.3% | |||||
Amgen, Inc.* | 8,500 | 548,845 | |||
Gilead Sciences, Inc.* | 10,800 | 604,044 | |||
Medimmune, Inc.* | 12,400 | 409,324 | |||
| 1,562,213 | ||||
Chemicals - Specialty - 0.7% | |||||
Ecolab, Inc. | 8,000 | 202,000 | |||
Communications Equipment - 8.0% | |||||
j2 Global Communications, Inc.* | 20,000 | 756,600 | |||
Nortel Networks Corp.* | 104,300 | 427,630 | |||
Scientific-Atlanta, Inc. | 9,000 | 280,350 | |||
Telefonaktiebolaget LM Ericsson* | 39,500 | 579,860 | |||
UTStarcom, Inc.* | 9,000 | 286,290 | |||
| 2,330,730 | ||||
Computers - Hardware - 1.4% | |||||
Dell, Inc.* |
| 6,800 | 227,052 | ||
Hewlett-Packard Co. | 9,900 | 191,664 | |||
| 418,716 | ||||
Computers - Peripherals - 5.2% | |||||
SanDisk Corp.* | 19,200 | 1,223,808 | |||
Western Digital Corp.* | 22,300 | 287,447 | |||
| 1,511,255 | ||||
Computers - Software & Services - 11.3% | |||||
Affiliated Computer Services, Inc.* | 8,000 | 389,520 | |||
Avid Technology, Inc.* | 11,000 | 581,240 | |||
eBay, Inc.* |
| 4,600 | 246,146 | ||
Electronic Arts, Inc.* | 5,200 | 479,596 | |||
Foundry Networks, Inc.* | 29,600 | 636,696 | |||
RSA Security, Inc.* | 21,800 | 311,304 | |||
Synopsys, Inc.* |
| 10,600 | 326,162 | ||
Veritas Software Corp.* | 11,300 | 354,820 | |||
| 3,325,484 | ||||
Distributors - Food & Health - 0.6% | |||||
Sysco Corp. | 5,400 | 176,634 | |||
Electronics - Instrument - 2.0% | |||||
Agilent Technologies, Inc.* | 26,100 | 577,071 | |||
Financial - Diversified - 6.4% | |||||
Fannie Mae | 1,371 | $96,244 | |||
J.P. Morgan Chase & Co. | 17,200 | 590,476 | |||
Moody's Corp. | 8,600 | 472,742 | |||
SLM Corp. |
| 18,600 | 724,656 | ||
| 1,884,118 | ||||
Healthcare - Diversified - 0.5% | |||||
Johnson & Johnson | 2,744 | 135,883 | |||
Healthcare - Drug - Major Pharmaceutical - 3.7% | |||||
Eon Labs, Inc.* | 13,900 | 533,065 | |||
Teva Pharmaceutical Industries | 9,800 | 560,070 | |||
| 1,093,135 | ||||
Healthcare - Managed Care - 4.8% | |||||
Express Scripts, Inc.* | 4,600 | 281,290 | |||
Mid Atlantic Medical Services* | 5,300 | 272,579 | |||
Oxford Health Plans* | 8,100 | 334,611 | |||
Wellpoint Health Networks, Inc.* | 6,600 | 508,728 | |||
| 1,397,208 | ||||
Healthcare - Medical Products & Supplies - 4.0% | |||||
Biomet, Inc. | 5,700 | 191,577 | |||
Medtronic, Inc. | 8,100 | 380,052 | |||
St. Jude Medical, Inc.* | 2,600 | 139,802 | |||
Stryker Corp.* | 5,900 | 444,329 | |||
| 1,155,760 | ||||
Insurance - Life & Health - 1.3% | |||||
Aflac, Inc. | 11,500 | 371,450 | |||
Insurance - Property & Casualty - 3.5% | |||||
Progressive Corp. | 10,200 | 704,922 | |||
Safeco Corp. | 8,800 | 310,288 | |||
| 1,015,210 | ||||
Investment Banking / Brokerage - 4.1% | |||||
Ameritrade Holding Corp.* | 53,000 | 596,250 | |||
E*trade Financial Corp.* | 66,600 | 616,716 | |||
| 1,212,966 | ||||
Leisure Time - Products - 1.3% | |||||
Harley-Davidson, Inc. | 7,700 | 371,140 | |||
Manufacturing - Diversified - 1.4% | |||||
Danaher Corp. | 5,600 | 413,616 | |||
Natural Gas - 1.4% | |||||
Kinder Morgan, Inc. | 7,800 | 421,278 | |||
Photography / Imaging - 2.2% | |||||
Canon, Inc. | 6,900 | $336,168 | |||
Xerox Corp.* | 30,900 | 317,034 | |||
| 653,202 | ||||
Restaurants - 1.1% | |||||
Starbucks Corp.* | 10,700 | 308,160 | |||
Retail - Building Supplies - 3.2% | |||||
Home Depot, Inc. | 14,100 | 449,085 | |||
Lowe's Co.'s, Inc. | 9,500 | 493,050 | |||
| 942,135 | ||||
Retail - Computers & Electronics - 2.2% | |||||
Best Buy Co., Inc.* | 13,300 | 632,016 | |||
Retail - Discounters - 1.5% | |||||
Family Dollar Stores, Inc. | 11,000 | 438,790 | |||
Retail - Home Shopping - 2.0% | |||||
Amazon.Com, Inc.* | 12,300 | 594,828 | |||
Retail - Specialty - 3.0% | |||||
Bed Bath & Beyond, Inc.* | 10,400 | 397,072 | |||
Staples, Inc.* | 20,300 | 482,125 | |||
| 879,197 | ||||
Services - Commercial & Consumer - 5.5% | |||||
Apollo Group, Inc.* | 4,150 | 274,024 | |||
Career Education Corp.* | 13,800 | 625,140 | |||
H & R Block, Inc. | 6,500 | 280,475 | |||
Reuters Group plc | 20,600 | 446,608 | |||
| 1,626,247 | ||||
Services - Data Processing - 1.5% | |||||
First Data Corp. | 10,854 | 433,726 | |||
Telecommunications - Cell / Wireless - 4.4% | |||||
Nextel Communications, Inc.* | 65,500 | 1,289,695 | |||
Telecommunications - Long Distance - 1.0% | |||||
Deutsche Telekom AG* | 20,700 | 298,908 | |||
Telephone - 1.0% | |||||
SBC Communications, Inc. | 13,600 | 302,600 | |||
Total Equity Securities (Cost $23,800,235) | 29,069,720 |
Principal | |||||
Certificates of Deposit - 0.3% | Amount | Value | |||
ShoreBank & Trust Co., 1.31%, 2/09/04(b)(k) | $100,000 | $99,980 | |||
Total Certificates of Deposit (Cost $100,000) | 99,980 | ||||
Total Investments (Cost $23,900,235) - 99.5% | 29,169,700 | ||||
Other assets and liabilities, net - 0.5% | 136,902 | ||||
Net Assets - 100% | $29,306,602 |
* Non-income producing security.
(b) This security was valued by the Board of Directors. See Note A.
(k) These certificates of deposit are fully insured by agencies of the federal government.
See notes to financial statements.
Statement of Assets and Liabilities
September 30, 2003
Assets | Value | |
Investments in securities, at value (Cost $23,900,235) - | ||
see accompanying schedule | $29,169,700 | |
Cash | 1,376,322 | |
Receivable for securities sold | 114,763 | |
Receivable for shares sold | 194,075 | |
Interest and dividends receivable | 14,443 | |
Other assets | 16,418 | |
Total assets | 30,885,721 | |
Liabilities | ||
Payable for securities purchased | 1,224,993 | |
Payable for shares redeemed | 261,272 | |
Payable to Calvert Asset Management Co., Inc. | 41,597 | |
Payable to Calvert Administrative Services Company | 4,519 | |
Payable to Calvert Shareholder Services, Inc. | 2,614 | |
Payable to Calvert Distributors, Inc. | 9,784 | |
Accrued expenses and other liabilities | 34,340 | |
Total liabilities | 1,579,119 | |
Net Assets | $29,306,602 | |
Net Assets Consist of: | ||
Paid-in capital applicable to the following shares of common stock, | ||
250,000,000 shares of $0.01 par value authorized for Class A, | ||
Class B, Class C and Class I combined: | ||
Class A: 860,218 shares outstanding | $18,260,618 | |
Class B: 229,501 shares outstanding | 4,624,909 | |
Class C: 127,978 shares outstanding | 2,686,298 | |
Class I: 178,343 shares outstanding | 6,094,621 | |
Accumulated net realized gain (loss) on investments | (7,629,309) | |
Net unrealized appreciation (depreciation) on investments | 5,269,465 | |
Net Assets | $29,306,602 | |
Net Asset Value Per Share | ||
Class A (based on net assets of $18,139,205) | $21.09 | |
Class B (based on net assets of $4,705,126) | $20.50 | |
Class C (based on net assets of $2,634,592) | $20.59 | |
Class I (based on net assets of $3,827,679) | $21.46 |
See notes to financial statements.
Statement of Operations
Year Ended September 30, 2003
Net Investment Income | ||||||||
Investment Income: | ||||||||
Dividend income (net of foreign taxes withheld of $319) | $125,661 | |||||||
Interest income | 2,544 | |||||||
Total investment income | 128,205 | |||||||
Expenses: | ||||||||
Investment advisory fee | 52,387 | |||||||
Investment subadvisory fee: | ||||||||
Base fee | 94,297 | |||||||
Performance adjustment | 37,910 | |||||||
Transfer agency fees and expenses | 105,634 | |||||||
Distribution Plan expenses: | ||||||||
Class A | 31,228 | |||||||
Class B | 30,842 | |||||||
Class C | 16,150 | |||||||
Directors' fees and expenses | 25,812 | |||||||
Administrative fees | 38,145 | |||||||
Accounting fees | 34,115 | |||||||
Custodian fees | 15,499 | |||||||
Registration fees | 44,283 | |||||||
Reports to shareholders | 12,712 | |||||||
Professional fees | 21,079 | |||||||
Miscellaneous | 3,453 | |||||||
Total expenses | 563,546 | |||||||
Reimbursement from Advisor: | ||||||||
Class A | (103,942) | |||||||
Class B | (24,974) | |||||||
Class C | (17,390) | |||||||
Class I | (36,346) | |||||||
Fees paid indirectly | (4,256) | |||||||
Net expenses | 376,638 | |||||||
Net Investment Income (Loss) | (248,433) | |||||||
Realized and Unrealized Gain (Loss) on Investments | ||||||||
Net realized gain (loss) | (446,097) | |||||||
Change in unrealized appreciation or (depreciation) | 6,028,949 | |||||||
Net Realized and Unrealized Gain | ||||||||
(Loss) on Investments | 5,582,852 | |||||||
Increase (Decrease) in Net Assets | ||||||||
Resulting From Operations | $5,334,419 |
See notes to financial statements.
Statements of Changes in Net Assets
Year Ended | Year Ended | |||||
September 30, | September 30, | |||||
Increase (Decrease) in Net Assets | 2003 | 2002 | ||||
Operations: | ||||||
Net investment income (loss) | ($248,433) | ($109,211) | ||||
Net realized gain (loss) | (446,097) | (2,725,770) | ||||
Change in unrealized appreciation | ||||||
or (depreciation) | 6,028,949 | (140,640) | ||||
Increase (Decrease) in Net Assets | ||||||
Resulting From Operations | 5,334,419 | (2,975,621) | ||||
Capital share transactions: | ||||||
Shares sold: | ||||||
Class A Shares | 9,561,406 | 5,050,676 | ||||
Class B Shares | 2,600,469 | 1,297,634 | ||||
Class C Shares | 1,471,287 | 909,768 | ||||
Class I Shares | 342,204 | 224,775 | ||||
Shares redeemed: | ||||||
Class A Shares | (3,387,990) | (1,535,278) | ||||
Class B Shares | (719,225) | (247,449) | ||||
Class C Shares | (457,594) | (100,710) | ||||
Class I Shares | (1,078,809) | (1,077,091) | ||||
Total capital share transactions | 8,331,748 | 4,522,325 | ||||
Total Increase (Decrease) in Net Assets | 13,666,167 | 1,546,704 | ||||
Net Assets | ||||||
Beginning of year | 15,640,435 | 14,093,731 | ||||
End of year | $29,306,602 | $15,640,435 | ||||
Capital Share Activity | ||||||
Shares sold: | ||||||
Class A Shares | 507,070 | 259,568 | ||||
Class B Shares | 139,719 | 66,950 | ||||
Class C Shares | 77,448 | 46,206 | ||||
Class I Shares | 19,053 | 11,501 | ||||
Shares redeemed: | ||||||
Class A Shares | (185,866) | (80,851) | ||||
Class B Shares | (40,176) | (12,902) | ||||
Class C Shares | (26,517) | (5,278) | ||||
Class I Shares | (58,172) | (55,277) | ||||
Total capital share activity | 432,559 | 229,917 |
See notes to financial statements.
Notes to Financial Statements
Note A -- Significant Accounting Policies
General:The Calvert Large Cap Growth Fund (the "Fund"), a series of Calvert Impact Fund, Inc., is registered under the Investment Company Act of 1940 as a diversified, open-end management investment company. The Calvert Impact Fund, Inc. was organized as a Maryland corporation on August 10, 2000. On October 19, 2000, the Fund sold 6,667 shares ("initial shares") valued at $100,000, to Calvert Asset Management Company, Inc., the Fund's investment advisor. The Fund began operations on October 31, 2000 and offers four separate classes of shares. Class A shares are sold with a maximum front-end sales charge of 4.75%. Class B shares are sold without a front-end sales charge. With certain exceptions, the Fund will impose a deferred sales charge at the time of redemption, depending on how long the shares have been owned by the investor. Class C shares are sold without a front-end sales charge. With certain exceptions, the Fund will impose a deferred sales charge on shares sold within one year of purchase. Class B and Class C shares have higher levels of expenses than Class A shares. Class I shares have no front-end or deferred sales charge. Class I shares require a minimum account balance of $1,000,000. The $1 million minimum investment may be waived for certain institutional accounts, where it is believed to be in the best interest of the Fund and its shareholders. Each class has different: (a) dividend rates, due to differences in Distribution Plan expenses and other class-specific expenses, (b) exchange privileges, and (c) class-specific voting rights.
Security Valuation:Net asset value per share is determined every business day as of the close of the regular session of the New York Stock Exchange (generally 4:00 p.m. Eastern time), and at such other times as may be necessary or appropriate. Securities for which market quotations are available are valued at last sale price or official closing price on the primary market or exchange in which they trade. Unlisted securities and listed securities for which a market quotation is not available are valued at the most recent bid price or based on a yield equivalent obtained from the securities' market maker. Short-term notes are stated at amortized cost, which approximates fair value. Other securities for which market quotations are not available or deemed inappropriate are valued in good faith under the direction of the Board of Directors.
In determining fair value, the Board considers all relevant qualitative and quantitative information available. These factors are subject to change over time and are reviewed periodically. The values assigned to fair value investments are based on available information and do not necessarily represent amounts that might ultimately be realized. Further, because of the inherent uncertainty of valuation, those estimated values may differ significantly from the values that would have been used had a ready market for the investments existed, and the differences could be material.
At September 30, 2003, $99,980 or 0.3% of net assets were valued in good faith by the Board of Directors.
Repurchase Agreements:The Fund may enter into repurchase agreements with recognized financial institutions or registered broker/dealers and, in all instances, holds underlying securities with a value exceeding the total repurchase price, including accrued interest. Although risk is mitigated by the collateral, the Fund could experience a delay in recovering its value and a possible loss of income or value if the counterparty fails to perform in accordance with the terms of the agreement.
Security Transactions and Net Investment Income:Security transactions are accounted for on trade date. Realized gains and losses are recorded on an identified cost basis. Dividend income is recorded on the ex-dividend date. Interest income, which includes amortization of premium and accretion of discount on debt securities, is accrued as earned. Investment income and realized and unrealized gains and losses are allocated to separate classes of shares based upon the relative net assets of each class. Expenses arising in connection with a class are charged directly to that class. Expenses common to the classes are allocated to each class in proportion to their relative net assets.
Distributions to Shareholders:Distributions to shareholders are recorded by the Fund on ex-dividend date. Dividends from net investment income and distributions from net realized capital gains, if any, are paid at least annually. Distributions are determined in accordance with income tax regulations which may differ from generally accepted accounting principles; accordingly, periodic reclassifications are made within the Fund's capital accounts to reflect income and gains available for distribution under income tax regulations.
Estimates:The preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reported period. Actual results could differ from those estimates.
Expense Offset Arrangements:The Fund has an arrangement with its custodian bank whereby the custodian's and transfer agent's fees may be paid indirectly by credits earned on the Fund's cash on deposit with the bank. Such a deposit arrangement is an alternative to overnight investments.
Federal Income Taxes:No provision for federal income or excise tax is required since the Fund intends to qualify as a regulated investment company under the Internal Revenue Code and to distribute substantially all of its taxable earnings.
Note B -- Related Party Transactions
Calvert Asset Management Company, Inc. (the "Advisor") is wholly-owned by Calvert Group, Ltd. ("Calvert") which is indirectly wholly-owned by Ameritas Acacia Mutual Holding Company. The Advisor provides investment advisory services and pays the salaries and fees of officers and affiliated Directors of the Fund. For its services, the Advisor receives a monthly fee based on an annual rate of .25% of the Fund's average daily net assets.
Bridgeway Capital Management, Inc., is the Fund's Subadvisor. For its services, the Subadvisor receives a monthly fee based on an annual rate of .45% of the Fund's average daily net assets, directly payable from the Fund. The Subadvisor may earn (or have its base fee reduced by) a performance fee adjustment of plus or minus .25%, based on the extent to which performance of the Fund exceeds or trails the Standard & Poor's 500 Index, the Fund's benchmark.
The Advisor has agreed to limit net annual fund operating expenses through January 31, 2004. The contractual expense cap is 1.50% for Class A, 2.50% for Class B, 2.50% for Class C and .90% for Class I. For the purposes of this expense limit, operating expenses do not include interest expense, brokerage commissions, performance fee adjustments, taxes, extraordinary expenses and capital items.
Calvert Administrative Services Company, an affiliate of the Advisor, provides administrative services to the Fund for an annual fee, payable monthly, of .20% for Classes A, B, and C, and .10% for Class I based on their average daily net assets.
Calvert Distributors, Inc. ("CDI"), an affiliate of the Advisor, is the distributor and principal underwriter for the Fund. Pursuant to Rule 12b-1 under the Investment Company Act of 1940, the Fund has adopted Distribution Plans that permit the Fund to pay certain expenses associated with the distribution and servicing of its shares. The expenses paid may not exceed .25%, 1.00% and 1.00% annually of average daily net assets of each Class A, Class B and Class C, respectively. Class I shares do not have Distribution Plan expenses.
The Distributor received $24,340 as its portion of commissions charged on sales of the Fund's Class A shares for the year ended September 30, 2003.
Calvert Shareholder Services, Inc. ("CSSI") is the shareholder servicing agent for the Fund. For its services, CSSI received a fee of $25,817 for the year ended September 30, 2003. Boston Financial Data Services, Inc. is the transfer and dividend disbursing agent.
Each Director of Calvert Impact Fund, Inc., who is not affiliated with the Advisor receives an annual fee of $5,000 that is allocated to each of the funds served.
Note C -- Investment Activity
During the year, purchases and sales of investments, other than short-term securities, were $23,893,078 and $15,970,425, respectively.
The cost of investments owned at September 30, 2003 for federal income tax purposes was $23,930,825. Net unrealized appreciation aggregated $5,238,876 of which $5,569,608 related to appreciated securities and $330,732 related to depreciated securities.
Net realized capital loss carryforward for federal income tax purposes of $404,383, $4,136,661 and $3,057,676 at September 30, 2003 may be utilized to offset future capital gains until expiration in September 2008, September 2010 and September 2011, respectively.
As of September 30, 2003, the components of distributable earnings/(accumulated losses) on a tax basis were as follows:
Capital loss carryforward | ($7,598,720) | |||
Unrealized appreciation (depreciation) | 5,238,876 | |||
($2,359,844) |
Reclassifications have been made to the Fund's components of net assets to reflect income and gains available for distribution (or available capital loss carryovers, as applicable) under income tax law and regulations. The primary differences causing such reclassifications are due to the disallowance of net operating losses.
The differences between the components of distributable earnings on a tax basis and the amounts reflected in the statement of assets and liabilities are primarily due to wash sales.
Note D -- Line of Credit
A financing agreement is in place with all Calvert Group Funds (except for the Calvert Social Investment Fund's Balanced and Enhanced Equity Portfolios, the CVS Calvert Social Balanced Portfolio and the CVS Ameritas Index 500 Portfolio) and State Street Bank and Trust Company ("the Bank"). Under the agreement, the Bank is providing an unsecured line of credit facility, in the aggregate amount of $50 million ($25 million committed and $25 million uncommitted), to be accessed by the Funds for temporary or emergency purposes only. Borrowings under this facility bear interest at the overnight Federal Funds Rate plus .50% per annum. A commitment fee of .10% per annum will be incurred on the unused portion of the committed facility which will be allocated to all participating funds. The Fund had no loans outstanding pursuant to this line of credit at September 30, 2003. For the year ended September 30, 2003, borrowings by the Fund under the Agreement were as follows:
Weighted | Month of | |||||||||||||||
Average | Average | Maximum | Maximum | |||||||||||||
Daily | Interest | Amount | Amount | |||||||||||||
Balance | Rate | Borrowed | Borrowed | |||||||||||||
$2,025 | 1.81% | $197,822 | May 2003 |
Financial Highlights
Years Ended | |||||||
September 30, | September 30, | ||||||
Class A Shares | 2003 | 2002 | |||||
Net asset value, beginning | $16.25 | $19.19 | |||||
Income from investment operations | |||||||
Net investment income | (.16) | (.10) | |||||
Net realized and unrealized gain (loss) | 5.00 | (2.84) | |||||
Total from investment operations | 4.84 | (2.94) | |||||
Total increase (decrease) in net asset value | 4.84 | (2.94) | |||||
Net asset value, ending | $21.09 | $16.25 | |||||
Total return* | 29.78% | (15.32%) | |||||
Ratios to average net assets: | |||||||
Net investment income | (1.07%) | (.64%) | |||||
Total expenses | 2.53% | 2.48% | |||||
Expenses before offsets | 1.70% | 1.42% | |||||
Net expenses | 1.68% | 1.39% | |||||
Portfolio turnover | 78% | 71% | |||||
Net assets, ending (in thousands) | $18,139 | $8,758 | |||||
Periods Ended | |||||||
September 30 | June 30, | ||||||
Class A Shares | 2001## | 2001# | |||||
Net asset value, beginning | $23.27 | $29.87 | |||||
Income from investment operations | |||||||
Net investment income | (.02) | (.08) | |||||
Net realized and unrealized gain (loss) | (4.06) | (6.52) | |||||
Total from investment operations | (4.08) | (6.60) | |||||
Total increase (decrease) in net asset value | (4.08) | (6.60) | |||||
Net asset value, ending | $19.19 | $23.27 | |||||
Total return* | (17.53%) | (22.10%) | |||||
Ratios to average net assets: | |||||||
Net investment income | (.61%) (a) | (.54%) (a) | |||||
Total expenses | 2.62% (a) | 3.02% (a) | |||||
Expenses before offsets | 1.39% (a) | 1.42% (a) | |||||
Net expenses | 1.30% (a) | 1.37% (a) | |||||
Portfolio turnover | 31% | 122% | |||||
Net assets, ending (in thousands) | $6,915 | $7,318 | |||||
Years Ended | |||||||
September 30, | September 30, | ||||||
Class B Shares | 2003 | 2002 | |||||
Net asset value, beginning | $15.96 | $19.04 | |||||
Income from investment operations | |||||||
Net investment income (loss) | (.28) | (.25) | |||||
Net realized and unrealized gain (loss) | 4.82 | (2.83) | |||||
Total from investment operations | 4.54 | (3.08) | |||||
Total increase (decrease) in net asset value | 4.54 | (3.08) | |||||
Net asset value, ending | $20.50 | $15.96 | |||||
Total return* | 28.45% | (16.18%) | |||||
Ratios to average net assets: | |||||||
Net investment income (loss) | (2.07%) | (1.64%) | |||||
Total expenses | 3.51% | 3.61% | |||||
Expenses before offsets | 2.70% | 2.42% | |||||
Net expenses | 2.68% | 2.39% | |||||
Portfolio turnover | 78% | 71% | |||||
Net assets, ending (in thousands) | $4,705 | $2,074 | |||||
Periods Ended | |||||||
September 30, | June 30, | ||||||
Class B Shares | 2001## | 2001# | |||||
Net asset value, beginning | $23.15 | $29.87 | |||||
Income from investment operations | |||||||
Net investment income (loss) | (.05) | (.21) | |||||
Net realized and unrealized gain (loss) | (4.06) | (6.51) | |||||
Total from investment operations | (4.11) | (6.72) | |||||
Total increase (decrease) in net asset value | (4.11) | (6.72) | |||||
Net asset value, ending | $19.04 | $23.15 | |||||
Total return* | (17.75%) | (22.50%) | |||||
Ratios to average net assets: | |||||||
Net investment income (loss) | (1.60%) (a) | (1.55%) (a) | |||||
Total expenses | 4.19% (a) | 6.17% (a) | |||||
Expenses before offsets | 2.39% (a) | 2.42% (a) | |||||
Net expenses | 2.30% (a) | 2.37% (a) | |||||
Portfolio turnover | 31% | 122% | |||||
Net assets, ending (in thousands) | $1,445 | $1,372 | |||||
Years Ended | |||||||
September 30, | September 30, | ||||||
Class C Shares | 2003 | 2002 | |||||
Net asset value, beginning | $16.02 | $19.12 | |||||
Income from investment operations | |||||||
Net investment income (loss) | (.26) | (.24) | |||||
Net realized and unrealized gain (loss) | 4.83 | (2.86) | |||||
Total from investment operations | 4.57 | (3.10) | |||||
Total increase (decrease) in net asset value | 4.57 | (3.10) | |||||
Net asset value, ending | $20.59 | $16.02 | |||||
Total return* | 28.53% | (16.21%) | |||||
Ratios to average net assets: | |||||||
Net investment income (loss) | (2.08%) | (1.64%) | |||||
Total expenses | 3.78% | 3.96% | |||||
Expenses before offsets | 2.70% | 2.42% | |||||
Net expenses | 2.68% | 2.39% | |||||
Portfolio turnover | 78% | 71% | |||||
Net assets, ending (in thousands) | $2,635 | $1,234 | |||||
Periods Ended | |||||||
September 30, | June 30, | ||||||
Class C Shares | 2001## | 2001# | |||||
Net asset value, beginning | $23.24 | $29.87 | |||||
Income from investment operations | |||||||
Net investment income (loss) | (.06) | (.21) | |||||
Net realized and unrealized gain (loss) | (4.06) | (6.42) | |||||
Total from investment operations | (4.12) | (6.63) | |||||
Total increase (decrease) in net asset value | (4.12) | (6.63) | |||||
Net asset value, ending | $19.12 | $23.24 | |||||
Total return* | (17.73%) | (22.20%) | |||||
Ratios to average net assets: | |||||||
Net investment income (loss) | (1.62%) (a) | (1.50%) (a) | |||||
Total expenses | 5.14% (a) | 5.75% (a) | |||||
Expenses before offsets | 2.39% (a) | 2.42% (a) | |||||
Net expenses | 2.30% (a) | 2.37% (a) | |||||
Portfolio turnover | 31% | 122% | |||||
Net assets, ending (in thousands) | $691 | $743 | |||||
Periods Ended | ||||||||
September 30, | September 30, | September 30, | ||||||
Class I Shares | 2003 | 2002 | 2001## | |||||
Net asset value, beginning | $16.44 | $19.30 | $23.37 | |||||
Income from investment operations | ||||||||
Net investment income (loss) | (.10) | (.01) | -- | |||||
Net realized and unrealized gain (loss) | 5.12 | (2.85) | (4.07) | |||||
Total from investment operations | 5.02 | (2.86) | (4.07) | |||||
Distributions from | ||||||||
Net realized gain | -- | -- | -- | |||||
Total distributions | -- | -- | -- | |||||
Total increase (decrease) in net asset value | 5.02 | (2.86) | (4.07) | |||||
Net asset value, ending | $21.46 | $16.44 | $19.30 | |||||
Total return* | 30.54% | (14.82%) | (17.42%) | |||||
Ratios to average net assets: | ||||||||
Net investment income (loss) | (.46%) | (.05%) | (.02%) (a) | |||||
Total expenses | 2.07% | 1.81% | 2.13% (a) | |||||
Expenses before offsets | 1.10% | .82% | .79% (a) | |||||
Net expenses | 1.08% | .79% | .70% (a) | |||||
Portfolio turnover | 78% | 71% | 31% | |||||
Net assets, ending (in thousands) | $3,828 | $3,574 | $5,043 |
Years Ended | ||||||||
June 30, | June 30, | June 30, | ||||||
Class I Shares | 2001 | 2000 | 1999 | |||||
Net asset value, beginning | $36.09 | $26.45 | $21.14 | |||||
Income from investment operations | ||||||||
Net investment income | .01 | (.12) | (.14) | |||||
Net realized and unrealized gain (loss) | (9.12) | 10.03 | 5.62 | |||||
Total from investment operations | (9.11) | 9.91 | 5.48 | |||||
Distributions from | ||||||||
Net investment income | -- | -- | -- | |||||
Net realized gain | (3.61) | (.27) | (.17) | |||||
Total distributions | (3.61) | (.27) | (.17) | |||||
Total increase (decrease) in net asset value | (12.72) | 9.64 | 5.31 | |||||
Net asset value, ending | $23.37 | $36.09 | $26.45 | |||||
Total return* | (27.80%) | 37.60% | 26.20% | |||||
Ratios to average net assets: | ||||||||
Net investment income (loss) | .02% | (.37%) | (.60%) | |||||
Total expenses | 2.05% | 2.13% | 2.13% | |||||
Expenses before offsets | 1.10% | 1.50% | 1.50% | |||||
Net expenses | 1.06% | 1.50% | 1.50% | |||||
Portfolio turnover | 122% | 71% | 58% | |||||
Net assets, ending (in thousands) | $6,208 | $7,385 | $2,820 |
(a) Annualized
* Total return does not reflect deduction of any front-end or deferred sales charge.
# From October 31, 2000 inception.
## Three month audited period.
Pursuant to the Agreement and Plan of Reorganization, the Social Responsibility Portfolio of Bridgeway Fund, Inc. was reorganized into the Class I Shares of the Calvert Large Cap Growth Fund on October 31, 2000. For financial reporting purposes, the Bridgeway Social Responsibility Portfolio, which commenced operations on August 5, 1994, has been deemed the accounting survivor. Its operations are combined with that of the Fund since the Fund's inception in presenting the Fund's financial highlights.
See notes to financial statements.
Explanation of Financial Tables
Schedule of Investments
The Schedule of Investments is a snapshot of all securities held in the fund at their market value, on the last day of the reporting period. Securities are listed by asset type (e.g., common stock, corporate bonds, U.S. government obligations) and may be further broken down into sub-groups and by industry classification.
Statement of Assets and Liabilities
The Statement of Assets and Liabilities is often referred to as the fund's balance sheet. It lists the value of what the fund owns, is due and owes on the last day of the reporting period. The fund's assets include the market value of securities owned, cash, receivables for securities sold and shareholder subscriptions, and receivables for dividends and interest payments that have been earned, but not yet received. The fund's liabilities include payables for securities purchased and shareholder redemptions, and expenses owed but not yet paid. The statement also reports the fund's net asset value (NAV) per share on the last day of the reporting period. The NAV is calculated by dividing the fund's net assets (assets minus liabilities) by the number of shares outstanding. This statement is accompanied by a Schedule of Investments. Alternatively, if certain conditions are met, a Statement of Net Assets may be presented in lieu of this statement and the Schedule of Investments.
Statement of Net Assets
The Statement of Net Assets provides a detailed list of the fund's holdings, including each security's market value on the last day of the reporting period. The Statement of Net Assets includes a Schedule of Investments. Other assets are added and other liabilities subtracted from the investments total to calculate the fund's net assets. Finally, net assets are divided by the outstanding shares of the fund to arrive at its share price, or Net Asset Value (NAV) per share.
At the end of the Statement of Net Assets is a table displaying the composition of the fund's net assets. Paid in Capital is the money invested by shareholders and represents the bulk of net assets. Undistributed Net Investment Income and Accumulated Net Realized Gains usually approximate the amounts the fund had available to distribute to shareholders as of the statement date. Accumulated Realized Losses will appear as negative balances. Unrealized Appreciation (Depreciation) is the difference between the market value of the fund's investments and their cost, and reflects the gains (losses) that would be realized if the fund were to sell all of its investments at their statement-date values.
Statement of Operations
The Statement of Operations summarizes the fund's investment income earned and expenses incurred in operating the fund. Investment income includes dividends earned from stocks and interest earned from interest-bearing securities in the fund. Expenses incurred in operating the fund include the advisory fee paid to the investment advisor, administrative services fees, distribution plan expenses (if applicable), transfer agent fees, shareholder servicing expenses, custodial, legal, and audit fees, and the printing and postage expenses related to shareholder reports. Expense offsets (fees paid indirectly) are also shown. Credits earned from offset arrangements are used to reduce the fund's expenses. This statement also shows net gains (losses) realized on the sale of investments and the increase or decrease in the unrealized appreciation (depreciation) on investments held during the period.
Statement of Changes in Net Assets
The Statement of Changes in Net Assets shows how the fund's total net assets changed during the two most recent reporting periods. Changes in the fund's net assets are attributable to investment operations, distributions and capital share transactions.
The Operations section of the report summarizes information detailed in the Statement of Operations. The Distribution section shows the dividend and capital gain distributions made to shareholders. The amounts shown as distributions in this section may not match the net investment income and realized gains amounts shown in the Operations section because distributions are determined on a tax basis and certain investments or transactions may be treated differently for financial statement and tax purposes. The Capital Share Transactions section shows the amount shareholders invested in the fund, either by purchasing shares or by reinvesting distributions, and the amounts redeemed. The corresponding numbers of shares issued, reinvested and redeemed are shown at the end of the report.
Financial Highlights
The Financial Highlights table provides a per-share breakdown per class of the components that affect the fund's net asset value for current and past reporting periods. The table provides total return, total distributions, expense ratios, portfolio turnover and net assets for the applicable period. Total return is a measure of a fund's performance that encompasses all elements of return: dividends, capital gain distributions and changes in net asset value. Total return is the change in value of an investment over a given period, assuming reinvestment of any dividends and capital gain distributions, expressed as a percentage of the initial investment. Total distributions include distributions from net investment income and net realized gains. Long-term gains are earned on securities held in the fund more than one year. Short-term gains, on the sale of securities held less than one year, are treated as ordinary dividend income for tax purposes. The expense ratio is a fund's cost of doing business, expressed as a percentage of net assets. These expenses directly reduce returns to shareholders. Portfolio turnover measures the trading activity in a fund's investment portfolio -- how often securities are bought and sold by a fund. Portfolio turnover is affected by market conditions, changes in the size of the fund, the nature of the fund's investments and the investment style of the portfolio manager.
Director and Officer Information Table
# of Calvert | ||||||||
Position | Position | Portfolios | Other | |||||
Name & | with | Start | Principal Occupation | Overseen | Directorships | |||
Date of Birth | Fund | Date | During Last 5 Years | (Not Applicable to Officers) | ||||
REBECCA ADAMSONDOB: 09/10/49 | Director
| 2000 | President of the national non-profit, First Nations Financial Project. Founded by her in 1980, First Nations is the only American Indian alternative development institute in the country. | 7 | Tom's of Maine Calvert Foundation | |||
MILES DOUGLAS HARPER, III DOB: 10/16/62 | Director | 2000 | Partner, Gainer Donnelly & Desroches since January 1999. Prior to that Mr. Harper was Vice President, Wood, Harper, PC. | 1 | Bridgeway Funds | |||
Joy V. JOnes DOB: 07/02/50 | Director
| 2000 | Attorney and entertainment manager in New York City. | 7 | ||||
BARBARA J. KRUMSIEK DOB: 08/09/52 (interested Director) | Director & President | 2000 | President, Chief Executive Officer and Vice Chairman of Calvert Group, Ltd. Prior to joining Calvert in 1997, Ms. Krumsiek had served as a Managing Director of Alliance Fund Distributors, Inc. | 37 | Calvert Foundation | |||
D. Wayne Silby, Esq. DOB: 07/20/48(interested Director) | Director | 2000 | Mr. Silby is Chairman of GroupServe Foundation, a software company focused on collaborative tools for non-profit groups. He is an officer and director of Silby, Guffey and Co., Inc., a private investment company. | 21 | Ameritas Acacia Mutual Life Insurance Company Calvert Foundation Grameen Foundation USA | |||
SUSAN walker Bender, Esq. DOB: 01/29/59 | Officer
| 2000 | Assistant Vice President and Associate General Counsel of Calvert Group, Ltd. | |||||
IVY WAFFORD DUKE, Esq. DOB: 09/07/68 | Officer
| 2000 | Assistant Vice President and Associate General Counsel of Calvert Group, Ltd. | |||||
Daniel K. Hayes DOB: 09/09/50 | Officer
| 2000 | Senior Vice President of Calvert Asset Management Company, Inc. | |||||
HUI PING HO, CPA DOB: 01/06/65 | Officer
| 2000 | Tax Compliance Manager of Calvert Group, Ltd. and Assistant Fund Treasurer. | |||||
Gregory J. Keifer DOB: 08/22/64 | Officer | 2003 | Compliance Officer and Assistant Secretary of the Funds. Prior to working at Calvert Group, Mr. Keifer was Assistant Director of Compliance with Legg Mason Wood Walker, Incorporated and a senior compliance analyst with BISYS Fund Services. | |||||
LANCELOT A. KING, Esq. DOB: 07/19/70 | Officer | 2002 | Assistant Secretary and Assistant General Counsel of Calvert Group, Ltd. Prior to working at Calvert Group, Mr. King was an associate with Mintz, Levin, Cohn, Ferris, Glovsky & Popeo, and also with Kirkpatrick & Lockhart. | |||||
William M. Tartikoff, Esq. DOB: 08/12/47 | Officer
| 2000 | Senior Vice President, Secretary, and General Counsel of Calvert Group, Ltd. | |||||
Ronald M. Wolfsheimer, CPA DOB: 07/24/52 | Officer
| 2000 | Senior Vice President and Chief Financial Officer of Calvert Group, Ltd. and Fund Treasurer. | |||||
MICHAEL V. YUHAS JR., CPA DOB: 08/04/61 | Officer
| 2000 | Director of Fund Administration of Calvert Group, Ltd. and Fund Controller. | |||||
The address of Directors and Officers is 4550 Montgomery Avenue, Suite 1000N, Bethesda, Maryland 20814, except Mr. Silby's address is 1715 18th Street, N.W., Washington, DC 20009. Ms. Krumsiek is an interested person of the Fund since she is an officer and director of the Fund's advisor and its affiliates. Mr. Silby is an interested person of the Fund since he is a director of the parent company of the Fund's advisor.
Additional information about the Fund's Directors can be found in the Statement of Additional Information (SAI). You can get a free copy of the SAI by contacting your broker, or the Fund at 1-800-368-2745.
SUPPLEMENT TO
CLASS I (INSTITUTIONAL) SHARES PROSPECTUS
Calvert Social Investment Fund Portfolios
Calvert Social Index Fund
Calvert Large Cap Growth Fund
Calvert Capital Accumulation Fund
Calvert World Values International Equity Fund
Calvert New Vision Small Cap Fund
Calvert Income Fund
Calvert Short Duration Income Fund
Prospectus dated: January 31, 2003
Date of Supplement: June 9, 2003
The $1 million minimum initial investment may be waived for certain institutional accounts, where it is believed to be in the best interest of the Fund and its shareholders.
Please note this change in the prospectus.
SUPPLEMENT TO
PROSPECTUS
Calvert Social Investment Fund (CSIF) Balanced Portfolio
CSIF Equity Portfolio
CSIF Enhanced Equity Portfolio
CSIF Bond Portfolio
CSIF Money Market Portfolio
Calvert Social Index Fund
Calvert Large Cap Growth Fund
Calvert Capital Accumulation Fund
Calvert World Values International Equity Fund
Calvert New Vision Small Cap Fund
Date of Prospectus: January 31, 2003 as revised June 30, 2003
Class I (Institutional) Shares
(All Portfolios)
Date of Prospectus: January 31, 2003
Calvert Income Fund
Calvert Short Duration Income Fund
Date of Prospectus: January 31, 2003 as revised September 15, 2003
CALVERT VARIABLE SERIES, INC.
PROSPECTUS
Calvert Social Balanced Portfolio
Calvert Income Portfolio
Date of Prospectus: April 30, 2003
Date of This Supplement: October 30, 2003
Please replace the second paragraph under "About Calvert" with the following: (for Calvert Variable Series Social Balanced and Income Portfolios replace the third paragraph under "The Fund and Its Management" with the following:)
Steven Falci serves as Calvert's Chief Investment Officer, Equities and oversees the investment strategy and management of all Calvert equity and balanced portfolios. Calvert uses a team approach to its management of the fixed-income portfolios. Gregory Habeeb heads this team for Calvert's taxable fixed-income portfolios. Mr. Habeeb has over 20 years of experience as an analyst, trader, and portfolio manager. Matt Nottingham is also a member of the fixed-income management team. Mr. Nottingham has 7 1/2 years of experience as an analyst, trader, and portfolio manager.
Calvert Large Cap Growth Fund
To Open an Account
800-368-2748
Yields and Prices
Calvert Information Network
(24 hours, 7 days a week)
800-368-2745
Service for Existing Account
Shareholders: 800-368-2745
Brokers: 800-368-2746
TDD for Hearing Impaired
800-541-1524
Branch Office
4550 Montgomery Avenue
Suite 1000 North
Bethesda, Maryland 20814
Registered, Certified
or Overnight Mail
Calvert Group
c/o BFDS
330 West 9th Street
Kansas City, MO 64105
Web Site
http://www.calvert.com
Principal Underwriter
Calvert Distributors, Inc.
4550 Montgomery Avenue
Suite 1000 North
Bethesda, Maryland 20814
This report is intended to provide fund information to shareholders. It is not authorized for distribution to prospective investors unless preceded or accompanied by a prospectus.
Calvert's
Family of Funds
Tax-Exempt
Money Market Funds
CTFR Money Market Portfolio
CTFR California Money Market Portfolio
Taxable
Money Market Funds
First Government Money Market Fund
CSIF Money Market Portfolio
Balanced Fund
CSIF Balanced Portfolio
Municipal Funds
CTFR Limited-Term Portfolio
CTFR Long-Term Portfolio
CTFR Vermont Municipal Portfolio
National Muni. Intermediate Portfolio
California Muni. Intermediate Portfolio
Taxable Bond Funds
CSIF Bond Portfolio
Income Fund
Short Duration Income Fund
Equity Funds
CSIF Enhanced Equity Portfolio
CSIF Equity Portfolio
Calvert Large Cap Growth Fund
Capital Accumulation Fund
CWV International Equity Fund
New Vision Small Cap Fund
Calvert Social Index Fund
printed on recycled paper using soy-based inks
<PAGE>
Item 2. Code of Ethics.
(a) The registrant has adopted a code of ethics (the "Code of Ethics") that applies to its principal executive officer and principal financial officer (also referred to as "principal accounting officer").
(b) No information need be disclosed under this paragraph.
(c) The registrant has not amended its Code of Ethics during the period covered by the shareholder report presented in Item 1 hereto.
(d) The registrant has not granted a waiver or implicit waiver from a provision of its Code of Ethics during the period covered by the shareholder report presented in Item 1 hereto.
(e) Not applicable.
(f) The registrant's Code of Ethics is attached as an Exhibit hereto.
Item 3. Audit Committee Financial Expert.
The registrant's Board of Trustees has determined that Miles Harper, an "independent" Trustee serving on the registrant's audit committee, is an "audit committee financial expert," as defined in Item 3 of Form N-CSR. Under applicable securities laws, a person who is determined to be an audit committee financial expert will not be deemed an "expert" for any purpose, including without limitation for the purposes of Section 11 of the Securities Act of 1933, as a result of being designated or identified as an audit committee financial expert. The designation or identification of a person as an audit committee financial expert does not impose on such person any duties, obligations, or liabilities that are greater than the duties, obligations, and liabilities imposed on such person as a member of the audit committee and Board of Trustees in the absence of such designation or identification.
Item 4. Principal Accountant Fees and Services.
Applicable only for annual reports covering fiscal years ending on or after December 15, 2003.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. [Reserved]
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable.
Item 8. [Reserved]
Item 9. Controls and Procedures.
(a) The principal executive and financial officers concluded that the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the 1940 Act) are effective, based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rules 13a-15(b) or 15d-15(b) under the Exchange Act, as of a date within 90 days of the filing date of this report.
(b) There was no change in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the registrant's most recent fiscal half-year that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.
Item 10. Exhibits.
(a)(1) Code of Ethics.
(a)(2) Certifications of principal executive officer and principal financial
officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
(b) Certifications of principal executive officer and principal financial
officer pursuant to Section 906 of Sarbanes-Oxley Act of 2002.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
CALVert IMPACT fund
By: /s/ Barbara Krumsiek
Barbara Krumsiek
President -- Principal Executive Officer
Date: November 25, 2003
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment 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.
/s/ Barbara Krumsiek
Barbara Krumsiek
President -- Principal Executive Officer
Date: November 25, 2003
/s/ Ronald Wolfsheimer
Ronald Wolfsheimer
Treasurer -- Principal Financial Officer
Date: November 30, 2003