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 | 811-06247 | |||||||||||||||||||
AMERICAN CENTURY WORLD MUTUAL FUNDS, INC. | ||||||||||||||||||||
(Exact name of registrant as specified in charter) | ||||||||||||||||||||
4500 MAIN STREET, KANSAS CITY, MISSOURI | 64111 | |||||||||||||||||||
(Address of principal executive offices) | (Zip Code) | |||||||||||||||||||
JOHN PAK 4500 MAIN STREET, KANSAS CITY, MISSOURI 64111 | ||||||||||||||||||||
(Name and address of agent for service) | ||||||||||||||||||||
Registrant’s telephone number, including area code: | 816-531-5575 | |||||||||||||||||||
Date of fiscal year end: | 11-30 | |||||||||||||||||||
Date of reporting period: | 11-30-2021 |
ITEM 1. REPORTS TO STOCKHOLDERS.
(a) Provided under separate cover.
![image37.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image37.jpg)
Annual Report | |||||
November 30, 2021 | |||||
Emerging Markets Fund | |||||
Investor Class (TWMIX) | |||||
I Class (AMKIX) | |||||
Y Class (AEYMX) | |||||
A Class (AEMMX) | |||||
C Class (ACECX) | |||||
R Class (AEMRX) | |||||
R5 Class (AEGMX) | |||||
R6 Class (AEDMX) |
Table of Contents |
President’s Letter | |||||
Performance | |||||
Portfolio Commentary | |||||
Fund Characteristics | |||||
Shareholder Fee Example | |||||
Schedule of Investments | |||||
Statement of Assets and Liabilities | |||||
Statement of Operations | |||||
Statement of Changes in Net Assets | |||||
Notes to Financial Statements | |||||
Financial Highlights | |||||
Report of Independent Registered Public Accounting Firm | |||||
Management | |||||
Approval of Management Agreement | |||||
Additional Information |
Any opinions expressed in this report reflect those of the author as of the date of the report, and do not necessarily represent the opinions of American Century Investments® or any other person in the American Century Investments organization. Any such opinions are subject to change at any time based upon market or other conditions and American Century Investments disclaims any responsibility to update such opinions. These opinions may not be relied upon as investment advice and, because investment decisions made by American Century Investments funds are based on numerous factors, may not be relied upon as an indication of trading intent on behalf of any American Century Investments fund. Security examples are used for representational purposes only and are not intended as recommendations to purchase or sell securities. Performance information for comparative indices and securities is provided to American Century Investments by third party vendors. To the best of American Century Investments’ knowledge, such information is accurate at the time of printing.
President’s Letter |
![image30a.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image30a.jpg)
Dear Investor:
Thank you for reviewing this annual report for the period ended November 30, 2021. Annual reports help convey important information about fund returns, including market factors that affected performance. For additional investment insights, please visit americancentury.com.
Global Stocks Advanced Despite Lingering and New Challenges
Global stocks broadly delivered solid gains for the 12-month period, even as pandemic-related challenges persisted. Improving economic data, along with central bank and government support and positive vaccine developments, helped boost corporate earnings and promote investor optimism. The U.S. generally outpaced other nations. Virus outbreaks and slower vaccine rollouts, particularly in emerging markets, led to lingering lockdowns in some regions.
As the period progressed, steady economic gains combined with ongoing monetary and fiscal support, rising energy prices and severe supply chain disruptions pushed global interest rates and inflation higher. In the U.S., year-over-year headline inflation climbed to 6.8% in November 2021, the largest 12-month increase in nearly 40 years. Similarly, inflation in the eurozone hit a 30-year high, while prices in the U.K. climbed to their highest level in 10 years.
Late in the period, the Federal Reserve began tapering its bond buying while adopting a more hawkish rate-tightening outlook amid surging inflation. However, central banks in Europe and the U.K. maintained their supportive programs, expressing concerns about slowing global growth outlooks. Meanwhile, the emergence of a new COVID-19 variant in late November triggered a steep sell-off among global stocks to end the reporting period.
Despite mounting inflation worries and late-period volatility, global stocks delivered solid performance for the full 12 months, highlighted by strong gains in developed markets. Emerging markets stocks generally delivered more modest returns.
Several Factors Shaping Market Dynamics
The return to pre-pandemic life is progressing, albeit somewhat cautiously due to COVID-19’s lingering effects. As the economy and markets respond to this fluid backdrop, investors will face opportunities and ongoing challenges. Economic growth, inflation, the virus’s trajectory, supply chain normalization and fiscal and monetary policy likely will sway market dynamics.
We appreciate your confidence in us during these extraordinary times. Our firm has a long history of helping clients weather unpredictable markets, and we’re confident we will continue to meet today’s challenges.
Sincerely,
![image23.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image23.jpg)
Jonathan Thomas
President and Chief Executive Officer
American Century Investments
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Performance |
Total Returns as of November 30, 2021 | ||||||||||||||||||||
Average Annual Returns | ||||||||||||||||||||
Ticker Symbol | 1 year | 5 years | 10 years | Since Inception | Inception Date | |||||||||||||||
Investor Class | TWMIX | 0.91% | 10.53% | 6.82% | — | 9/30/97 | ||||||||||||||
MSCI Emerging Markets Index | — | 2.70% | 9.51% | 5.16% | — | — | ||||||||||||||
I Class | AMKIX | 1.09% | 10.76% | 7.02% | — | 1/28/99 | ||||||||||||||
Y Class | AEYMX | 1.24% | — | — | 9.14% | 4/10/17 | ||||||||||||||
A Class | AEMMX | 5/12/99 | ||||||||||||||||||
No sales charge | 0.60% | 10.25% | 6.55% | — | ||||||||||||||||
With sales charge | -5.17% | 8.96% | 5.92% | — | ||||||||||||||||
C Class | ACECX | -0.17% | 9.42% | 5.76% | — | 12/18/01 | ||||||||||||||
R Class | AEMRX | 0.41% | 9.98% | 6.28% | — | 9/28/07 | ||||||||||||||
R5 Class | AEGMX | 1.09% | — | — | 8.98% | 4/10/17 | ||||||||||||||
R6 Class | AEDMX | 1.24% | 10.91% | — | 7.09% | 7/26/13 |
Average annual returns since inception are presented when ten years of performance history is not available. Fund returns would have been lower if a portion of the fees had not been waived.
C Class shares will automatically convert to A Class shares after being held for approximately eight years. C Class average annual returns do not reflect this conversion.
Sales charges include initial sales charges and contingent deferred sales charges (CDSCs), as applicable. A Class shares have a 5.75% maximum initial sales charge and may be subject to a maximum CDSC of 1.00%. C Class shares redeemed within 12 months of purchase are subject to a maximum CDSC of 1.00%. The SEC requires that mutual funds provide performance information net of maximum sales charges in all cases where charges could be applied.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
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Growth of $10,000 Over 10 Years | ||
$10,000 investment made November 30, 2011 | ||
Performance for other share classes will vary due to differences in fee structure. |
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Value on November 30, 2021 | |||||
Investor Class — $19,345 | |||||
MSCI Emerging Markets Index — $16,546 | |||||
Ending value of Investor Class would have been lower if a portion of the fees had not been waived.
Total Annual Fund Operating Expenses | |||||||||||||||||||||||
Investor Class | I Class | Y Class | A Class | C Class | R Class | R5 Class | R6 Class | ||||||||||||||||
1.26% | 1.06% | 0.91% | 1.51% | 2.26% | 1.76% | 1.06% | 0.91% |
The total annual fund operating expenses shown is as stated in the fund’s prospectus current as of the date of this report. The prospectus may vary from the expense ratio shown elsewhere in this report because it is based on a different time period, includes acquired fund fees and expenses, and, if applicable, does not include fee waivers or expense reimbursements.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
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Portfolio Commentary |
Portfolio Managers: Patricia Ribeiro and Sherwin Soo
Performance Summary
Emerging Markets returned 0.91%* for the 12 months ended November 30, 2021. The fund’s benchmark, the MSCI Emerging Markets Index, returned 2.70% for the same period.
The fund underperformed its benchmark during the period, during which emerging markets faced several significant challenges, including regulatory pressure on Chinese growth stocks, the damage from COVID-19 variants and persistent inflationary pressures. The shifting inflation narrative, which supported cyclical sectors and drove value stocks to outperform growth, weighed on our positioning. The sharp (and continuous) rise in value was challenging for our investment approach as a growth manager. From a sector perspective, a combination of an underweight, relative to the benchmark, for most of the year in energy was a key driver of underperformance following the spike in energy prices. Stock selection in consumer staples also detracted, along with selection and an underweight in utilities. Conversely, stock selection in financials and health care added value during the period, along with an overweight to and stock choices in materials. Regionally, stock selection in India and Brazil were key drivers of relative underperformance, while stock choices in Taiwan and an underweight to China aided relative returns.
Energy and Consumer Staples Drive Underperformance
Lack of exposure to several index constituents in the oil, gas and consumable fuels industry was a key driver of the fund’s underperformance over the 12-month period, as the shares rose along with energy and oil prices. An off-benchmark position within the industry, independent oil and gas company Petro Rio, also weighed on relative performance.
In the consumer staples sector, food and staples retailing holdings drove relative detraction, including Turkish retailer BIM Birlesik Magazalar and Brazil-based drugstore chain Raia Drogasil. Food products company Nestle India also detracted. Birlesik Magazalar’s shares declined amid a combination of headlines regarding draft legislation on retail chains and increased country and currency risks. Increasing competition from well-capitalized peers weighed on Raia Drogasil, and we exited the position on concerns surrounding margin pressure. We also sold Nestle India as margin expansion was constrained by increased staffing costs.
Notable individual detractors included electronic components supplier Luxshare Precision Industry, Chinese education providers New Oriental Education & Technology Group and TAL Education Group, data center operator GDS Holdings and developer CIFI Holdings Group. Luxshare, the primary assembler of Apple’s AirPods, declined as sales growth of iPhones and AirPods slowed, and we exited the position as the new AirPods launch remained uncertain and shipment forecasts were lowered to factor in weaker-than-expected demand. New Oriental and TAL Education’s weakness was triggered by a regulatory crackdown on the after-school tutoring industry, which forced a nonprofit conversion and banned foreign capital for academic tutoring, and we sold off both positions. GDS’ shares weakened due to increasing concerns about the changing regulatory environment in China and the potential disruption to the company’s ability to grow earnings.
Financials and Health Care Led Contributors
Leasing firm Chailease Holding was responsible for the majority of contribution from the financials sector. The leasing firm’s recent results highlighted better operating efficiency, higher loan growth and lower credit costs. The rapid expansion in Chailease’s China leasing business has helped the
company diversify its earnings streams. Given strong momentum, we believe Chailease will likely see continued portfolio growth in mainland China and Taiwan. Furthermore, vaccination progress continued to support growth momentum in other key markets, such as Thailand and Malaysia.
*All fund returns referenced in this commentary are for Investor Class shares. Performance for other share classes will vary due to differences in fee structure; when Investor Class performance exceeds that of the fund’s benchmark, other share classes may not. See page 3 for returns for all share classes.
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Bank stocks also supported relative returns, particularly OTP Bank and Al Rajhi Bank. Hungary-based OTP’s shares rose with better-than-expected results that highlighted positive catalysts such as upside to consensus on stronger loan growth and better-than-expected cost of risk. Al Rajhi, the world’s largest Islamic bank, benefited from steady growth in its mortgage portfolio, which drove loan book growth.
In health care, a lack of exposure to several index constituents in the biotechnology and health care equipment and supplies industries bolstered returns, but the strongest individual contributor was Wuxi Biologics Cayman. The biologics research and development services provider benefited from strong business momentum and higher growth guidance, reflecting global outsourcing trends. Wuxi raised revenue forecasts based on stronger-than-expected growth for COVID-19 antibody and vaccine projects and non-COVID-19 projects. Demand for biological drugs in China is growing much faster than the global market, and Wuxi’s ability to serve multiple COVID-19 players adopting different technologies will likely drive recurring demand growth.
Elsewhere, key individual contributors included Contemporary Amperex Technology Co. (CATL), ASPEED Technology and Ganfeng Lithium. CATL, the world’s largest electric vehicle (EV) battery maker, is supported by technology and cost advantages. CATL’s June agreement to supply EV battery packs to Tesla provides longer order visibility. We believe CATL will likely continue to see global market share growth, driven by overseas expansion. Shares of integrated circuit design firm ASPEED were supported by its exposure to cloud servers amid continuing growth in cloud services and data center demand. The company’s capital spending expansion will likely drive sustainable future growth, in our view. Ganfeng’s shares advanced along with rising lithium prices, driven by a persistent rise in demand, the key driver of the company’s growth prospects. The lithium market has tightened as EV adoption and battery installation accelerates, supported by global commitments to decarbonization, and Ganfeng plans to further ramp up its production capacity and output.
Outlook
We remain constructive on emerging markets (EM) equities based on consistent progress against COVID-19. EM continues to lag behind developed markets on vaccinations; however, repeat waves and variants will likely be less economically disruptive with increased access to vaccinations and therapeutics. In addition, China will likely prioritize growth and stability in 2022 rather than regulatory tightening. Additional catalysts for 2022 include the restoration of EM’s growth premium to developed markets. These points, coupled with attractive valuations, support our constructive view.
Improving vaccination and caseload data continues to boost the outlook for EM, despite variants, in our view. Vaccine rates have improved across EM, notably in major markets such as Brazil and India. Increased vaccine supply and faster rollout should continue to reduce new case and hospitalization levels, spurring economic activity as economies more fully reopen.
Secular trends and the ongoing economic recovery continue to support information technology, consumer positioning and cyclicals. Digitalization, cloud-based computing and the shift to online continue to support technology, while the removal of mobility restrictions and economic reopening are benefiting select consumer-facing names and cyclicals.
China remains a prominent position in the portfolio. Chinese equity indices were among the worst performing in EM in 2021, owing to the normalization of pandemic policy and government crackdowns, including property developer leverage limits, antitrust regulation over leading internet platforms and a directional change for the after-school education sector. Nonetheless, signs of policy easing have begun to appear, and while further policy changes are possible as China pursues its long-term development and modernization agenda, we believe the most stringent changes may be behind us. Given an improving earnings outlook and improved valuations, consensus expectations for China have improved, significantly in some cases. We continue to invest in sectors with policy tailwinds, including green initiatives such as electric vehicles and renewable energy and their respective value chains, as well as the increasing reliance on technology.
Regional and sector differences continue. Recovery rates remain staggered across EM, depending upon each region’s success in dealing with COVID-19. We believe growth momentum will likely improve in those economies that continue to emerge from the pandemic. In our view, China will likely perform better in 2022 as the regulatory environment improves. Meanwhile, EM countries outside of North Asia, such as Europe, the Middle East and Africa (EMEA) and Latin America, where recovery data is not fully factored in, may have more room to recover.
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Fund Characteristics |
NOVEMBER 30, 2021 | |||||
Types of Investments in Portfolio | % of net assets | ||||
Common Stocks | 97.6% | ||||
Rights | —* | ||||
Temporary Cash Investments | 2.7% | ||||
Other Assets and Liabilities | (0.3)% | ||||
*Category is less than 0.05% of total net assets. | |||||
Top Five Countries | % of net assets | ||||
China | 29.7% | ||||
Taiwan | 16.7% | ||||
South Korea | 14.9% | ||||
India | 10.6% | ||||
Russia | 6.4% |
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Shareholder Fee Example |
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption/exchange fees; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in your fund and to compare these costs with the ongoing cost of investing in other mutual funds.
The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period from May 29, 2021 to November 30, 2021.
Actual Expenses
The table provides information about actual account values and actual expenses for each class. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. First, identify the share class you own. Then simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
If you hold Investor Class shares of any American Century Investments fund, or I Class shares of the American Century Diversified Bond Fund, in an American Century Investments account (i.e., not through a financial intermediary or employer-sponsored retirement plan account), American Century Investments may charge you a $25.00 annual account maintenance fee if the value of those shares is less than $10,000. We will redeem shares automatically in one of your accounts to pay the $25.00 fee. In determining your total eligible investment amount, we will include your investments in all personal accounts (including American Century Investments brokerage accounts) registered under your Social Security number. Personal accounts include individual accounts, joint accounts, UGMA/UTMA accounts, personal trusts, Coverdell Education Savings Accounts and IRAs (including traditional, Roth, Rollover, SEP-, SARSEP- and SIMPLE-IRAs), and certain other retirement accounts. If you have only business, business retirement, employer-sponsored or American Century Investments brokerage accounts, you are currently not subject to this fee. If you are subject to the account maintenance fee, your account value could be reduced by the fee amount.
Hypothetical Example for Comparison Purposes
The table also provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each class of your fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of a fund’s share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption/exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
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Beginning Account Value 5/29/21 | Ending Account Value 11/30/21 | Expenses Paid During Period(1) 5/29/21 - 11/30/21 | Annualized Expense Ratio(1) | |||||||||||
Actual | ||||||||||||||
Investor Class | $1,000 | $898.20 | $6.05 | 1.25% | ||||||||||
I Class | $1,000 | $898.70 | $5.08 | 1.05% | ||||||||||
Y Class | $1,000 | $899.50 | $4.36 | 0.90% | ||||||||||
A Class | $1,000 | $896.50 | $7.25 | 1.50% | ||||||||||
C Class | $1,000 | $893.10 | $10.85 | 2.25% | ||||||||||
R Class | $1,000 | $895.70 | $8.45 | 1.75% | ||||||||||
R5 Class | $1,000 | $898.80 | $5.08 | 1.05% | ||||||||||
R6 Class | $1,000 | $899.40 | $4.36 | 0.90% | ||||||||||
Hypothetical | ||||||||||||||
Investor Class | $1,000 | $1,019.11 | $6.43 | 1.25% | ||||||||||
I Class | $1,000 | $1,020.13 | $5.40 | 1.05% | ||||||||||
Y Class | $1,000 | $1,020.89 | $4.63 | 0.90% | ||||||||||
A Class | $1,000 | $1,017.84 | $7.71 | 1.50% | ||||||||||
C Class | $1,000 | $1,014.01 | $11.55 | 2.25% | ||||||||||
R Class | $1,000 | $1,016.56 | $8.99 | 1.75% | ||||||||||
R5 Class | $1,000 | $1,020.13 | $5.40 | 1.05% | ||||||||||
R6 Class | $1,000 | $1,020.89 | $4.63 | 0.90% |
(1)Expenses are equal to the class's annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 186, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. Annualized expense ratio reflects actual expenses, including any applicable fee waivers or expense reimbursements and excluding any acquired fund fees and expenses.
9
Schedule of Investments |
NOVEMBER 30, 2021
Shares | Value | |||||||
COMMON STOCKS — 97.6% | ||||||||
Brazil — 3.4% | ||||||||
Banco BTG Pactual SA | 4,470,700 | $ | 16,612,489 | |||||
Embraer SA, ADR(1) | 1,975,684 | 27,126,141 | ||||||
Petro Rio SA(1) | 5,662,100 | 20,233,836 | ||||||
Suzano SA(1) | 1,790,000 | 17,954,606 | ||||||
Vibra Energia SA | 3,069,400 | 11,874,997 | ||||||
WEG SA | 2,871,300 | 16,440,699 | ||||||
110,242,768 | ||||||||
China — 29.7% | ||||||||
Alibaba Group Holding Ltd., ADR(1) | 689,126 | 87,884,239 | ||||||
BYD Co. Ltd., H Shares | 1,678,000 | 66,001,746 | ||||||
China Construction Bank Corp., H Shares | 54,801,000 | 35,708,663 | ||||||
China Education Group Holdings Ltd. | 9,550,000 | 17,567,482 | ||||||
China Tourism Group Duty Free Corp. Ltd., A Shares | 1,000,917 | 32,342,190 | ||||||
Chinasoft International Ltd.(1) | 17,092,000 | 28,418,433 | ||||||
CIFI Holdings Group Co. Ltd. | 39,800,888 | 21,637,800 | ||||||
Contemporary Amperex Technology Co. Ltd., A Shares | 700,913 | 74,818,879 | ||||||
Country Garden Services Holdings Co. Ltd. | 4,599,000 | 27,882,158 | ||||||
ENN Energy Holdings Ltd. | 522,300 | 9,779,100 | ||||||
Ganfeng Lithium Co. Ltd., H Shares | 2,951,000 | 57,034,894 | ||||||
GDS Holdings Ltd., ADR(1) | 338,741 | 18,983,046 | ||||||
Huazhu Group Ltd., ADR(1) | 180,898 | 7,149,089 | ||||||
Industrial & Commercial Bank of China Ltd., H Shares | 25,397,645 | 13,420,955 | ||||||
Kweichow Moutai Co. Ltd., A Shares | 106,310 | 32,242,884 | ||||||
Li Ning Co. Ltd. | 3,989,000 | 45,117,939 | ||||||
Meituan, Class B(1) | 1,347,300 | 40,950,228 | ||||||
Nine Dragons Paper Holdings Ltd. | 12,024,000 | 13,412,058 | ||||||
NIO, Inc., ADR(1) | 785,458 | 30,734,972 | ||||||
Ping An Insurance Group Co. of China Ltd., H Shares | 2,538,000 | 17,594,030 | ||||||
Shenzhou International Group Holdings Ltd. | 2,119,200 | 39,794,010 | ||||||
Tencent Holdings Ltd. | 2,698,900 | 157,397,302 | ||||||
Wuxi Biologics Cayman, Inc.(1) | 4,299,000 | 57,992,578 | ||||||
Yantai Jereh Oilfield Services Group Co. Ltd., A Shares | 5,015,344 | 30,633,123 | ||||||
964,497,798 | ||||||||
Hungary — 1.5% | ||||||||
OTP Bank Nyrt(1) | 877,810 | 48,469,347 | ||||||
India — 10.6% | ||||||||
Asian Paints Ltd. | 498,803 | 20,873,081 | ||||||
Bajaj Finance Ltd. | 343,555 | 32,001,378 | ||||||
Bata India Ltd. | 643,473 | 16,093,095 | ||||||
HDFC Bank Ltd. | 3,576,662 | 70,856,641 | ||||||
ICICI Bank Ltd., ADR | 2,993,038 | 55,251,481 | ||||||
Infosys Ltd., ADR | 2,179,194 | 49,206,201 | ||||||
Jubilant Foodworks Ltd. | 730,692 | 35,576,961 | ||||||
Tata Consultancy Services Ltd. | 684,706 | 32,179,284 | ||||||
UltraTech Cement Ltd. | 332,054 | 32,792,058 | ||||||
344,830,180 |
10
Shares | Value | |||||||
Indonesia — 1.7% | ||||||||
Bank Rakyat Indonesia Persero Tbk PT | 179,901,500 | $ | 51,260,594 | |||||
Bukalapak.com Tbk PT(1) | 130,944,900 | 4,982,702 | ||||||
56,243,296 | ||||||||
Luxembourg — 0.7% | ||||||||
Ternium SA, ADR | 604,868 | 23,099,909 | ||||||
Malaysia — 0.4% | ||||||||
CIMB Group Holdings Bhd | 9,544,000 | 11,726,710 | ||||||
Mexico — 2.5% | ||||||||
Cemex SAB de CV, ADR(1) | 4,057,426 | 24,953,170 | ||||||
Grupo Financiero Banorte SAB de CV | 5,979,044 | 35,619,124 | ||||||
Wal-Mart de Mexico SAB de CV | 6,544,675 | 20,571,813 | ||||||
81,144,107 | ||||||||
Netherlands — 0.7% | ||||||||
Prosus NV(1) | 285,022 | 22,982,026 | ||||||
Philippines — 0.9% | ||||||||
Ayala Land, Inc. | 40,133,700 | 27,423,135 | ||||||
Russia — 6.4% | ||||||||
Magnit PJSC | 208,381 | 16,313,111 | ||||||
Novatek PJSC, GDR | 221,629 | 48,348,411 | ||||||
Sberbank of Russia PJSC, ADR (London) | 2,500,452 | 42,136,514 | ||||||
TCS Group Holding plc, GDR | 541,963 | 51,690,313 | ||||||
Yandex NV, A Shares(1) | 687,615 | 49,467,023 | ||||||
207,955,372 | ||||||||
Saudi Arabia — 1.6% | ||||||||
Al Rajhi Bank | 1,508,326 | 52,996,598 | ||||||
Singapore — 0.8% | ||||||||
Sea Ltd., ADR(1) | 90,732 | 26,137,167 | ||||||
South Africa — 1.6% | ||||||||
Capitec Bank Holdings Ltd. | 267,034 | 30,642,113 | ||||||
Naspers Ltd., N Shares | 141,314 | 21,644,551 | ||||||
52,286,664 | ||||||||
South Korea — 14.9% | ||||||||
CJ Logistics Corp.(1) | 129,431 | 13,503,448 | ||||||
Cosmax, Inc.(1) | 143,570 | 10,917,735 | ||||||
Ecopro BM Co. Ltd. | 98,424 | 44,995,562 | ||||||
Hyundai Motor Co. | 130,147 | 21,381,072 | ||||||
Iljin Materials Co. Ltd. | 88,624 | 9,552,538 | ||||||
Mando Corp.(1) | 368,944 | 16,960,818 | ||||||
NAVER Corp. | 146,086 | 46,638,241 | ||||||
Samsung Biologics Co. Ltd.(1) | 58,381 | 43,766,423 | ||||||
Samsung Electro-Mechanics Co. Ltd. | 265,891 | 37,234,436 | ||||||
Samsung Electronics Co. Ltd. | 2,505,813 | 150,414,455 | ||||||
Samsung SDI Co. Ltd. | 75,726 | 43,754,623 | ||||||
SK Hynix, Inc. | 446,199 | 42,657,105 | ||||||
481,776,456 | ||||||||
Taiwan — 16.7% | ||||||||
ASPEED Technology, Inc. | 324,000 | 39,074,633 | ||||||
Chailease Holding Co. Ltd. | 10,036,254 | 88,790,793 | ||||||
Formosa Plastics Corp. | 7,956,000 | 29,180,373 | ||||||
MediaTek, Inc. | 1,366,000 | 49,518,354 | ||||||
Merida Industry Co. Ltd. | 1,979,000 | 21,252,835 |
11
Shares | Value | |||||||
President Chain Store Corp. | 1,338,000 | $ | 12,947,522 | |||||
Taiwan Semiconductor Manufacturing Co. Ltd. | 13,314,939 | 283,191,127 | ||||||
Win Semiconductors Corp. | 1,322,000 | 17,196,722 | ||||||
541,152,359 | ||||||||
Thailand — 2.9% | ||||||||
CP ALL PCL | 10,543,100 | 18,491,575 | ||||||
Kasikornbank PCL | 9,303,900 | 36,409,559 | ||||||
PTT Exploration & Production PCL | 11,921,300 | 39,918,775 | ||||||
94,819,909 | ||||||||
Turkey — 0.3% | ||||||||
BIM Birlesik Magazalar AS | 2,106,988 | 10,725,717 | ||||||
United States — 0.3% | ||||||||
MercadoLibre, Inc.(1) | 8,925 | 10,606,559 | ||||||
TOTAL COMMON STOCKS (Cost $2,399,321,693) | 3,169,116,077 | |||||||
RIGHTS† | ||||||||
China† | ||||||||
CIFI Holdings Group Co. Ltd.(1) | 1,990,044 | 63,800 | ||||||
Thailand† | ||||||||
CP ALL PCL(1) | 702,873 | 7,092 | ||||||
TOTAL RIGHTS (Cost $—) | 70,892 | |||||||
TEMPORARY CASH INVESTMENTS — 2.7% | ||||||||
Repurchase Agreement, BMO Capital Markets Corp., (collateralized by various U.S. Treasury obligations, 0.125% - 2.625%, 6/30/22 - 5/15/51, valued at $19,437,140), in a joint trading account at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $19,029,540) | 19,029,529 | |||||||
Repurchase Agreement, Fixed Income Clearing Corp., (collateralized by various U.S. Treasury obligations, 1.00%, 7/31/28, valued at $64,748,708), at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $63,479,035) | 63,479,000 | |||||||
State Street Institutional U.S. Government Money Market Fund, Premier Class | 4,444,825 | 4,444,825 | ||||||
TOTAL TEMPORARY CASH INVESTMENTS (Cost $86,953,354) | 86,953,354 | |||||||
TOTAL INVESTMENT SECURITIES — 100.3% (Cost $2,486,275,047) | 3,256,140,323 | |||||||
OTHER ASSETS AND LIABILITIES — (0.3)% | (10,306,104) | |||||||
TOTAL NET ASSETS — 100.0% | $ | 3,245,834,219 |
MARKET SECTOR DIVERSIFICATION | |||||
(as a % of net assets) | |||||
Information Technology | 24.7% | ||||
Financials | 21.3% | ||||
Consumer Discretionary | 16.9% | ||||
Communication Services | 8.6% | ||||
Materials | 6.8% | ||||
Industrials | 5.4% | ||||
Energy | 4.2% | ||||
Consumer Staples | 3.7% | ||||
Health Care | 3.2% | ||||
Real Estate | 2.5% | ||||
Utilities | 0.3% | ||||
Temporary Cash Investments | 2.7% | ||||
Other Assets and Liabilities | (0.3)% |
12
NOTES TO SCHEDULE OF INVESTMENTS | ||||||||
ADR | - | American Depositary Receipt | ||||||
GDR | - | Global Depositary Receipt |
†Category is less than 0.05% of total net assets.
(1)Non-income producing.
See Notes to Financial Statements.
13
Statement of Assets and Liabilities |
NOVEMBER 30, 2021 | |||||
Assets | |||||
Investment securities, at value (cost of $2,486,275,047) | $ | 3,256,140,323 | |||
Receivable for investments sold | 24,624,548 | ||||
Receivable for capital shares sold | 5,046,433 | ||||
Dividends and interest receivable | 1,151,930 | ||||
Securities lending receivable | 6,929 | ||||
Other assets | 48,280 | ||||
3,287,018,443 | |||||
Liabilities | |||||
Payable for investments purchased | 28,627,186 | ||||
Payable for capital shares redeemed | 4,092,058 | ||||
Accrued management fees | 2,907,999 | ||||
Distribution and service fees payable | 45,911 | ||||
Accrued foreign taxes | 5,511,070 | ||||
41,184,224 | |||||
Net Assets | $ | 3,245,834,219 | |||
Net Assets Consist of: | |||||
Capital (par value and paid-in surplus) | $ | 2,716,802,844 | |||
Distributable earnings | 529,031,375 | ||||
$ | 3,245,834,219 |
Net Assets | Shares Outstanding | Net Asset Value Per Share | |||||||||
Investor Class, $0.01 Par Value | $554,001,244 | 40,534,360 | $13.67 | ||||||||
I Class, $0.01 Par Value | $1,661,545,279 | 118,484,726 | $14.02 | ||||||||
Y Class, $0.01 Par Value | $39,376,912 | 2,801,757 | $14.05 | ||||||||
A Class, $0.01 Par Value | $94,362,833 | 7,163,219 | $13.17* | ||||||||
C Class, $0.01 Par Value | $25,448,362 | 2,144,648 | $11.87 | ||||||||
R Class, $0.01 Par Value | $7,687,152 | 581,521 | $13.22 | ||||||||
R5 Class, $0.01 Par Value | $12,172,186 | 867,266 | $14.04 | ||||||||
R6 Class, $0.01 Par Value | $851,240,251 | 60,665,582 | $14.03 |
*Maximum offering price $13.97 (net asset value divided by 0.9425).
See Notes to Financial Statements.
14
Statement of Operations |
YEAR ENDED NOVEMBER 30, 2021 | |||||
Investment Income (Loss) | |||||
Income: | |||||
Dividends (net of foreign taxes withheld of $6,711,214) | $ | 53,309,714 | |||
Securities lending, net | 243,924 | ||||
Interest | 8,056 | ||||
53,561,694 | |||||
Expenses: | |||||
Management fees | 35,317,035 | ||||
Distribution and service fees: | |||||
A Class | 253,292 | ||||
C Class | 291,701 | ||||
R Class | 44,568 | ||||
Directors' fees and expenses | 84,199 | ||||
Other expenses | 27,707 | ||||
36,018,502 | |||||
Net investment income (loss) | 17,543,192 | ||||
Realized and Unrealized Gain (Loss) | |||||
Net realized gain (loss) on: | |||||
Investment transactions (net of foreign tax expenses paid (refunded) of $(310)) | 145,739,118 | ||||
Foreign currency translation transactions | (2,050,328) | ||||
143,688,790 | |||||
Change in net unrealized appreciation (depreciation) on: | |||||
Investments (includes (increase) decrease in accrued foreign taxes of $(4,445,534)) | (167,545,874) | ||||
Translation of assets and liabilities in foreign currencies | (85,236) | ||||
(167,631,110) | |||||
Net realized and unrealized gain (loss) | (23,942,320) | ||||
Net Increase (Decrease) in Net Assets Resulting from Operations | $ | (6,399,128) |
See Notes to Financial Statements.
15
Statement of Changes in Net Assets |
YEARS ENDED NOVEMBER 30, 2021 AND NOVEMBER 30, 2020 | ||||||||
Increase (Decrease) in Net Assets | November 30, 2021 | November 30, 2020 | ||||||
Operations | ||||||||
Net investment income (loss) | $ | 17,543,192 | $ | 11,919,347 | ||||
Net realized gain (loss) | 143,688,790 | (75,677,072) | ||||||
Change in net unrealized appreciation (depreciation) | (167,631,110) | 587,035,980 | ||||||
Net increase (decrease) in net assets resulting from operations | (6,399,128) | 523,278,255 | ||||||
Distributions to Shareholders | ||||||||
From earnings: | ||||||||
Investor Class | (3,436,076) | (8,013,736) | ||||||
I Class | (12,395,337) | (21,862,436) | ||||||
Y Class | (317,596) | (310,424) | ||||||
A Class | (298,238) | (874,154) | ||||||
C Class | — | (114,160) | ||||||
R Class | (3,177) | (57,761) | ||||||
R5 Class | (30,070) | (44,744) | ||||||
R6 Class | (6,236,864) | (8,006,334) | ||||||
Decrease in net assets from distributions | (22,717,358) | (39,283,749) | ||||||
Capital Share Transactions | ||||||||
Net increase (decrease) in net assets from capital share transactions (Note 5) | 430,517,881 | (110,421,098) | ||||||
Net increase (decrease) in net assets | 401,401,395 | 373,573,408 | ||||||
Net Assets | ||||||||
Beginning of period | 2,844,432,824 | 2,470,859,416 | ||||||
End of period | $ | 3,245,834,219 | $ | 2,844,432,824 |
See Notes to Financial Statements.
16
Notes to Financial Statements |
NOVEMBER 30, 2021
1. Organization
American Century World Mutual Funds, Inc. (the corporation) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company and is organized as a Maryland corporation. Emerging Markets Fund (the fund) is one fund in a series issued by the corporation. The fund’s investment objective is to seek capital growth.
The fund offers the Investor Class, I Class, Y Class, A Class, C Class, R Class, R5 Class and R6 Class. The A Class may incur an initial sales charge. The A Class and C Class may be subject to a contingent deferred sales charge.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently followed by the fund in preparation of its financial statements. The fund is an investment company and follows accounting and reporting guidance in accordance with accounting principles generally accepted in the United States of America. This may require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from these estimates. Management evaluated the impact of events or transactions occurring through the date the financial statements were issued that would merit recognition or disclosure.
Investment Valuations — The fund determines the fair value of its investments and computes its net asset value (NAV) per share at the close of regular trading (usually 4 p.m. Eastern time) on the New York Stock Exchange (NYSE) on each day the NYSE is open. The Board of Directors has adopted valuation policies and procedures to guide the investment advisor in the fund’s investment valuation process and to provide methodologies for the oversight of the fund’s pricing function.
Equity securities that are listed or traded on a domestic securities exchange are valued at the last reported sales price or at the official closing price as provided by the exchange. Equity securities traded on foreign securities exchanges are generally valued at the closing price of such securities on the exchange where primarily traded or at the close of the NYSE, if that is earlier. If no last sales price is reported, or if local convention or regulation so provides, the mean of the latest bid and asked prices may be used. Securities traded over-the-counter are valued at the mean of the latest bid and asked prices, the last sales price, or the official closing price. Equity securities initially expressed in local currencies are translated into U.S. dollars at the mean of the appropriate currency exchange rate at the close of the NYSE as provided by an independent pricing service.
Open-end management investment companies are valued at the reported NAV per share. Repurchase agreements are valued at cost, which approximates fair value.
If the fund determines that the market price for an investment is not readily available or the valuation methods mentioned above do not reflect an investment’s fair value, such investment is valued as determined in good faith by the Board of Directors or its delegate, in accordance with policies and procedures adopted by the Board of Directors. In its determination of fair value, the fund may review several factors including, but not limited to, market information regarding the specific investment or comparable investments and correlation with other investment types, futures indices or general market indicators. Circumstances that may cause the fund to use these procedures to value an investment include, but are not limited to: an investment has been declared in default or is distressed; trading in a security has been suspended during the trading day or a security is not actively trading on its principal exchange; prices received from a regular pricing source are deemed unreliable; or there is a foreign market holiday and no trading occurred.
The fund monitors for significant events occurring after the close of an investment’s primary exchange but before the fund’s NAV per share is determined. Significant events may include, but are not limited to: corporate announcements and transactions; governmental action and political unrest that could impact a specific investment or an investment sector; or armed conflicts, natural disasters and similar events that could affect investments in a specific country or region. The fund also monitors for significant fluctuations between domestic and foreign markets, as evidenced by the U.S. market or such other indicators that the Board of
17
Directors, or its delegate, deems appropriate. The fund may apply a model-derived factor to the closing price of equity securities traded on foreign securities exchanges. The factor is based on observable market data as provided by an independent pricing service.
Security Transactions — Security transactions are accounted for as of the trade date. Net realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes. Certain countries impose taxes on realized gains on the sale of securities registered in their country. The fund records the foreign tax expense, if any, on an accrual basis. The foreign tax expense on realized gains and unrealized appreciation reduces the net realized gain (loss) on investment transactions and net unrealized appreciation (depreciation) on investments, respectively.
Investment Income — Dividend income less foreign taxes withheld, if any, is recorded as of the ex-dividend date. Distributions received on securities that represent a return of capital or long-term capital gain are recorded as a reduction of cost of investments and/or as a realized gain. The fund may estimate the components of distributions received that may be considered nontaxable distributions or long-term capital gain distributions for income tax purposes. Interest income is recorded on the accrual basis and includes accretion of discounts and amortization of premiums. Securities lending income is net of fees and rebates earned by the lending agent for its services.
Foreign Currency Translations — All assets and liabilities initially expressed in foreign currencies are translated into U.S. dollars at prevailing exchange rates at period end. The fund may enter into spot foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of investment securities, dividend and interest income, spot foreign currency exchange contracts, and expenses are translated at the rates of exchange prevailing on the respective dates of such transactions. Net realized and unrealized foreign currency exchange gains or losses related to investment securities are a component of net realized gain (loss) on investment transactions and change in net unrealized appreciation (depreciation) on investments, respectively.
Repurchase Agreements — The fund may enter into repurchase agreements with institutions that American Century Investment Management, Inc. (ACIM) (the investment advisor) has determined are creditworthy pursuant to criteria adopted by the Board of Directors. The fund requires that the collateral, represented by securities, received in a repurchase transaction be transferred to the custodian in a manner sufficient to enable the fund to obtain those securities in the event of a default under the repurchase agreement. ACIM monitors, on a daily basis, the securities transferred to ensure the value, including accrued interest, of the securities under each repurchase agreement is equal to or greater than amounts owed to the fund under each repurchase agreement.
Joint Trading Account — Pursuant to an Exemptive Order issued by the Securities and Exchange Commission, the fund, along with certain other funds in the American Century Investments family of funds, may transfer uninvested cash balances into a joint trading account. These balances are invested in one or more repurchase agreements that are collateralized by U.S. Treasury or Agency obligations.
Segregated Assets — In accordance with the 1940 Act, the fund segregates assets on its books and records to cover certain types of investment securities and other financial instruments. ACIM monitors, on a daily basis, the securities segregated to ensure the fund designates a sufficient amount of liquid assets, marked-to-market daily. The fund may also receive assets or be required to pledge assets at the custodian bank or with a broker for collateral requirements.
Income Tax Status — It is the fund’s policy to distribute substantially all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code. Accordingly, no provision has been made for income taxes. The fund files U.S. federal, state, local and non-U.S. tax returns as applicable. The fund's tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years from the date of filing but can be longer in certain jurisdictions. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Multiple Class — All shares of the fund represent an equal pro rata interest in the net assets of the class to which such shares belong, and have identical voting, dividend, liquidation and other rights and the same terms and conditions, except for class specific expenses and exclusive rights to vote on matters affecting only individual classes. Income, non-class specific expenses, and realized and unrealized capital gains and losses of the fund are allocated to each class of shares based on their relative net assets.
18
Distributions to Shareholders — Distributions from net investment income and net realized gains, if any, are generally declared and paid annually. The fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code, in all events in a manner consistent with provisions of the 1940 Act.
Indemnifications — Under the corporation’s organizational documents, its officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business, the fund enters into contracts that provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against a fund. The risk of material loss from such claims is considered by management to be remote.
Securities Lending — Securities are lent to qualified financial institutions and brokers. State Street Bank & Trust Co. serves as securities lending agent to the fund pursuant to a Securities Lending Agreement. The lending of securities exposes the fund to risks such as: the borrowers may fail to return the loaned securities, the borrowers may not be able to provide additional collateral, the fund may experience delays in recovery of the loaned securities or delays in access to collateral, or the fund may experience losses related to the investment collateral. To minimize certain risks, loan counterparties pledge collateral in the form of cash and/or securities. The lending agent has agreed to indemnify the fund in the case of default of any securities borrowed. Cash collateral received is invested in the State Street Navigator Securities Lending Government Money Market Portfolio, a money market mutual fund registered under the 1940 Act. The loans may also be secured by U.S. government securities in an amount at least equal to the market value of the securities loaned, plus accrued interest and dividends, determined on a daily basis and adjusted accordingly. By lending securities, the fund seeks to increase its net investment income through the receipt of interest and fees. Such income is reflected separately within the Statement of Operations. The value of loaned securities and related collateral outstanding at period end, if any, are shown on a gross basis within the Schedule of Investments and Statement of Assets and Liabilities.
3. Fees and Transactions with Related Parties
Certain officers and directors of the corporation are also officers and/or directors of American Century Companies, Inc. (ACC). The corporation’s investment advisor, ACIM, the corporation's distributor, American Century Investment Services, Inc. (ACIS), and the corporation’s transfer agent, American Century Services, LLC, are wholly owned, directly or indirectly, by ACC.
Management Fees — The corporation has entered into a management agreement with ACIM, under which ACIM provides the fund with investment advisory and management services in exchange for a single, unified management fee (the fee) per class. The agreement provides that ACIM will pay all expenses of managing and operating the fund, except brokerage expenses, taxes, interest, fees and expenses of the independent directors (including legal counsel fees), extraordinary expenses, and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the 1940 Act. The fee is computed and accrued daily based on each class's daily net assets and paid monthly in arrears. The difference in the fee among the classes is a result of their separate arrangements for non-Rule 12b-1 shareholder services. It is not the result of any difference in advisory or custodial fees or other expenses related to the management of the fund’s assets, which do not vary by class.
The annual management fee for each class is as follows:
Investor Class | I Class | Y Class | A Class | C Class | R Class | R5 Class | R6 Class | ||||||||||||||||
1.25% | 1.05% | 0.90% | 1.25% | 1.25% | 1.25% | 1.05% | 0.90% |
Distribution and Service Fees — The Board of Directors has adopted a separate Master Distribution and Individual Shareholder Services Plan for each of the A Class, C Class and R Class (collectively the plans), pursuant to Rule 12b-1 of the 1940 Act. The plans provide that the A Class will pay ACIS an annual distribution and service fee of 0.25%. The plans provide that the C Class will pay ACIS an annual distribution and service fee of 1.00%, of which 0.25% is paid for individual shareholder services and 0.75% is paid for distribution services. The plans provide that the R Class will pay ACIS an annual distribution and service fee of 0.50%. The fees are computed and accrued daily based on each class’s daily net assets and paid monthly in arrears. The fees are used to pay financial intermediaries for distribution and individual shareholder services. Fees incurred under the plans during the period ended November 30, 2021 are detailed in the Statement of Operations.
19
Directors' Fees and Expenses — The Board of Directors is responsible for overseeing the investment advisor’s management and operations of the fund. The directors receive detailed information about the fund and its investment advisor regularly throughout the year, and meet at least quarterly with management of the investment advisor to review reports about fund operations. The fund’s officers do not receive compensation from the fund.
Interfund Transactions — The fund may enter into security transactions with other American Century Investments funds and other client accounts of the investment advisor, in accordance with the 1940 Act rules and procedures adopted by the Board of Directors. The rules and procedures require, among other things, that these transactions be effected at the independent current market price of the security. There were no interfund transactions during the period.
4. Investment Transactions
Purchases and sales of investment securities, excluding short-term investments, for the period ended November 30, 2021 were $1,498,497,048 and $1,117,748,279, respectively.
20
5. Capital Share Transactions
Transactions in shares of the fund were as follows:
Year ended November 30, 2021 | Year ended November 30, 2020 | |||||||||||||
Shares | Amount | Shares | Amount | |||||||||||
Investor Class/Shares Authorized | 1,100,000,000 | 1,100,000,000 | ||||||||||||
Sold | 10,257,205 | $ | 154,967,241 | 12,495,933 | $ | 134,906,888 | ||||||||
Issued in reinvestment of distributions | 222,670 | 3,290,668 | 722,447 | 7,801,863 | ||||||||||
Redeemed | (12,682,038) | (189,334,522) | (24,386,669) | (277,708,979) | ||||||||||
(2,202,163) | (31,076,613) | (11,168,289) | (135,000,228) | |||||||||||
I Class/Shares Authorized | 1,520,000,000 | 1,520,000,000 | ||||||||||||
Sold | 37,994,838 | 585,982,225 | 49,164,195 | 563,271,691 | ||||||||||
Issued in reinvestment of distributions | 763,688 | 11,554,604 | 1,776,798 | 19,811,353 | ||||||||||
Redeemed | (30,097,172) | (462,700,286) | (55,821,848) | (622,419,153) | ||||||||||
8,661,354 | 134,836,543 | (4,880,855) | (39,336,109) | |||||||||||
Y Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 1,671,573 | 25,772,225 | 1,038,304 | 11,973,089 | ||||||||||
Issued in reinvestment of distributions | 19,691 | 298,311 | 27,351 | 306,119 | ||||||||||
Redeemed | (1,043,781) | (16,151,806) | (173,558) | (1,986,251) | ||||||||||
647,483 | 9,918,730 | 892,097 | 10,292,957 | |||||||||||
A Class/Shares Authorized | 100,000,000 | 100,000,000 | ||||||||||||
Sold | 2,330,248 | 33,680,130 | 2,676,295 | 29,022,024 | ||||||||||
Issued in reinvestment of distributions | 12,777 | 182,204 | 53,746 | 556,804 | ||||||||||
Redeemed | (1,919,955) | (27,758,871) | (3,247,159) | (34,383,970) | ||||||||||
423,070 | 6,103,463 | (517,118) | (4,805,142) | |||||||||||
C Class/Shares Authorized | 45,000,000 | 45,000,000 | ||||||||||||
Sold | 372,548 | 4,958,377 | 192,283 | 2,004,278 | ||||||||||
Issued in reinvestment of distributions | — | — | 10,261 | 96,660 | ||||||||||
Redeemed | (509,367) | (6,661,355) | (977,404) | (9,501,689) | ||||||||||
(136,819) | (1,702,978) | (774,860) | (7,400,751) | |||||||||||
R Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 316,845 | 4,636,023 | 257,538 | 2,908,336 | ||||||||||
Issued in reinvestment of distributions | — | — | 5,549 | 57,761 | ||||||||||
Redeemed | (302,174) | (4,388,338) | (323,560) | (3,545,976) | ||||||||||
14,671 | 247,685 | (60,473) | (579,879) | |||||||||||
R5 Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 685,046 | 10,352,533 | 181,608 | 2,248,341 | ||||||||||
Issued in reinvestment of distributions | 1,934 | 29,285 | 4,015 | 44,739 | ||||||||||
Redeemed | (95,988) | (1,453,583) | (120,565) | (1,477,816) | ||||||||||
590,992 | 8,928,235 | 65,058 | 815,264 | |||||||||||
R6 Class/Shares Authorized | 450,000,000 | 450,000,000 | ||||||||||||
Sold | 32,070,850 | 490,325,641 | 17,846,785 | 207,338,285 | ||||||||||
Issued in reinvestment of distributions | 399,613 | 6,042,152 | 690,876 | 7,733,183 | ||||||||||
Redeemed | (12,638,202) | (193,104,977) | (12,752,599) | (149,478,678) | ||||||||||
19,832,261 | 303,262,816 | 5,785,062 | 65,592,790 | |||||||||||
Net increase (decrease) | 27,830,849 | $ | 430,517,881 | (10,659,378) | $ | (110,421,098) |
21
6. Fair Value Measurements
The fund’s investments valuation process is based on several considerations and may use multiple inputs to determine the fair value of the investments held by the fund. In conformity with accounting principles generally accepted in the United States of America, the inputs used to determine a valuation are classified into three broad levels.
•Level 1 valuation inputs consist of unadjusted quoted prices in an active market for identical investments.
•Level 2 valuation inputs consist of direct or indirect observable market data (including quoted prices for comparable investments, evaluations of subsequent market events, interest rates, prepayment speeds, credit risk, etc.). These inputs also consist of quoted prices for identical investments initially expressed in local currencies that are adjusted through translation into U.S. dollars.
•Level 3 valuation inputs consist of unobservable data (including a fund’s own assumptions).
The level classification is based on the lowest level input that is significant to the fair valuation measurement. The valuation inputs are not necessarily an indication of the risks associated with investing in these securities or other financial instruments.
The following is a summary of the level classifications as of period end. The Schedule of Investments provides additional information on the fund’s portfolio holdings.
Level 1 | Level 2 | Level 3 | |||||||||
Assets | |||||||||||
Investment Securities | |||||||||||
Common Stocks | |||||||||||
Brazil | $ | 27,126,141 | $ | 83,116,627 | — | ||||||
China | 144,751,346 | 819,746,452 | — | ||||||||
India | 104,457,682 | 240,372,498 | — | ||||||||
Luxembourg | 23,099,909 | — | — | ||||||||
Mexico | 24,953,170 | 56,190,937 | — | ||||||||
Russia | 49,467,023 | 158,488,349 | — | ||||||||
Singapore | 26,137,167 | — | — | ||||||||
United States | 10,606,559 | — | — | ||||||||
Other Countries | — | 1,400,602,217 | — | ||||||||
Rights | — | 70,892 | — | ||||||||
Temporary Cash Investments | 4,444,825 | 82,508,529 | — | ||||||||
$ | 415,043,822 | $ | 2,841,096,501 | — |
7. Risk Factors
The value of the fund’s shares will go up and down, sometimes rapidly or unpredictably, based on the performance of the securities owned by the fund and other factors generally affecting the securities market. Market risks, including political, regulatory, economic and social developments, can affect the value of the fund’s investments. Natural disasters, public health emergencies, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse long-term effects on world economies and markets generally.
There are certain risks involved in investing in foreign securities. These risks include those resulting from political events (such as civil unrest, national elections and imposition of exchange controls), social and economic events (such as labor strikes and rising inflation), and natural disasters. Securities of foreign issuers may be less liquid and more volatile. Investing in emerging markets or a significant portion of assets in one country or region may accentuate these risks.
22
8. Federal Tax Information
The tax character of distributions paid during the years ended November 30, 2021 and November 30, 2020 were as follows:
2021 | 2020 | |||||||
Distributions Paid From | ||||||||
Ordinary income | $ | 22,717,358 | $ | 39,283,749 | ||||
Long-term capital gains | — | — |
The book-basis character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements.
As of period end, the federal tax cost of investments and the components of distributable earnings on a tax-basis were as follows:
Federal tax cost of investments | $ | 2,501,330,276 | |||
Gross tax appreciation of investments | $ | 931,665,482 | |||
Gross tax depreciation of investments | (176,855,435) | ||||
Net tax appreciation (depreciation) of investments | 754,810,047 | ||||
Net tax appreciation (depreciation) on translation of assets and liabilities in foreign currencies | (5,599,193) | ||||
Net tax appreciation (depreciation) | $ | 749,210,854 | |||
Undistributed ordinary income | $ | 28,170,446 | |||
Accumulated short-term capital losses | $ | (248,349,925) |
The difference between book-basis and tax-basis unrealized appreciation (depreciation) is attributable primarily to the realization to ordinary income for tax purposes of unrealized gains on investments in passive foreign investment companies.
Accumulated capital losses represent net capital loss carryovers that may be used to offset future realized capital gains for federal income tax purposes. The capital loss carryovers may be carried forward for an unlimited period. Future capital loss carryover utilization in any given year may be subject to Internal Revenue Code limitations.
23
Financial Highlights |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Operating Expenses (before expense waiver) | Net Investment Income (Loss) | Net Investment Income (Loss) (before expense waiver) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||||||
Investor Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $13.62 | 0.05 | 0.08 | 0.13 | (0.08) | — | (0.08) | $13.67 | 0.91% | 1.25% | 1.25% | 0.36% | 0.36% | 35% | $554,001 | ||||||||||||||||||||||||||||||||
2020 | $11.25 | 0.04 | 2.48 | 2.52 | (0.15) | — | (0.15) | $13.62 | 22.79% | 1.26% | 1.26% | 0.33% | 0.33% | 30% | $582,036 | ||||||||||||||||||||||||||||||||
2019 | $10.19 | 0.17 | 0.94 | 1.11 | (0.05) | — | (0.05) | $11.25 | 10.99% | 1.25% | 1.25% | 1.59% | 1.59% | 39% | $606,668 | ||||||||||||||||||||||||||||||||
2018 | $12.00 | 0.08 | (1.80) | (1.72) | (0.03) | (0.06) | (0.09) | $10.19 | (14.57)% | 1.18% | 1.29% | 0.71% | 0.60% | 36% | $980,765 | ||||||||||||||||||||||||||||||||
2017 | $8.57 | 0.02 | 3.44 | 3.46 | (0.03) | — | (0.03) | $12.00 | 40.46% | 1.18% | 1.50% | 0.19% | (0.13)% | 47% | $883,436 | ||||||||||||||||||||||||||||||||
I Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $13.97 | 0.09 | 0.07 | 0.16 | (0.11) | — | (0.11) | $14.02 | 1.09% | 1.05% | 1.05% | 0.56% | 0.56% | 35% | $1,661,545 | ||||||||||||||||||||||||||||||||
2020 | $11.56 | 0.06 | 2.54 | 2.60 | (0.19) | — | (0.19) | $13.97 | 22.94% | 1.06% | 1.06% | 0.53% | 0.53% | 30% | $1,534,445 | ||||||||||||||||||||||||||||||||
2019 | $10.46 | 0.20 | 0.97 | 1.17 | (0.07) | — | (0.07) | $11.56 | 11.20% | 1.05% | 1.05% | 1.79% | 1.79% | 39% | $1,325,801 | ||||||||||||||||||||||||||||||||
2018 | $12.32 | 0.11 | (1.85) | (1.74) | (0.06) | (0.06) | (0.12) | $10.46 | (14.35)% | 0.98% | 1.09% | 0.91% | 0.80% | 36% | $897,336 | ||||||||||||||||||||||||||||||||
2017 | $8.79 | 0.04 | 3.54 | 3.58 | (0.05) | — | (0.05) | $12.32 | 40.86% | 0.94% | 1.26% | 0.43% | 0.11% | 47% | $505,000 | ||||||||||||||||||||||||||||||||
Y Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $14.00 | 0.10 | 0.08 | 0.18 | (0.13) | — | (0.13) | $14.05 | 1.24% | 0.90% | 0.90% | 0.71% | 0.71% | 35% | $39,377 | ||||||||||||||||||||||||||||||||
2020 | $11.60 | 0.08 | 2.54 | 2.62 | (0.22) | — | (0.22) | $14.00 | 23.09% | 0.91% | 0.91% | 0.68% | 0.68% | 30% | $30,169 | ||||||||||||||||||||||||||||||||
2019 | $10.49 | 0.26 | 0.94 | 1.20 | (0.09) | — | (0.09) | $11.60 | 11.43% | 0.90% | 0.90% | 1.94% | 1.94% | 39% | $14,638 | ||||||||||||||||||||||||||||||||
2018 | $12.34 | 0.08 | (1.81) | (1.73) | (0.06) | (0.06) | (0.12) | $10.49 | (14.23)% | 0.83% | 0.94% | 1.06% | 0.95% | 36% | $4,724 | ||||||||||||||||||||||||||||||||
2017(3) | $9.79 | 0.07 | 2.48 | 2.55 | — | — | — | $12.34 | 26.05% | 0.77%(4) | 1.12%(4) | 0.91%(4) | 0.56%(4) | 47%(5) | $6 |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Operating Expenses (before expense waiver) | Net Investment Income (Loss) | Net Investment Income (Loss) (before expense waiver) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||||||
A Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $13.13 | 0.01 | 0.07 | 0.08 | (0.04) | — | (0.04) | $13.17 | 0.60% | 1.50% | 1.50% | 0.11% | 0.11% | 35% | $94,363 | ||||||||||||||||||||||||||||||||
2020 | $10.84 | 0.01 | 2.40 | 2.41 | (0.12) | — | (0.12) | $13.13 | 22.50% | 1.51% | 1.51% | 0.08% | 0.08% | 30% | $88,485 | ||||||||||||||||||||||||||||||||
2019 | $9.81 | 0.14 | 0.91 | 1.05 | (0.02) | — | (0.02) | $10.84 | 10.71% | 1.50% | 1.50% | 1.34% | 1.34% | 39% | $78,704 | ||||||||||||||||||||||||||||||||
2018 | $11.57 | 0.05 | (1.75) | (1.70) | — | (0.06) | (0.06) | $9.81 | (14.80)% | 1.43% | 1.54% | 0.46% | 0.35% | 36% | $72,711 | ||||||||||||||||||||||||||||||||
2017 | $8.26 | —(6) | 3.32 | 3.32 | (0.01) | — | (0.01) | $11.57 | 40.16% | 1.43% | 1.75% | (0.06)% | (0.38)% | 47% | $61,586 | ||||||||||||||||||||||||||||||||
C Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $11.88 | (0.08) | 0.07 | (0.01) | — | — | — | $11.87 | (0.17)% | 2.25% | 2.25% | (0.64)% | (0.64)% | 35% | $25,448 | ||||||||||||||||||||||||||||||||
2020 | $9.82 | (0.07) | 2.17 | 2.10 | (0.04) | — | (0.04) | $11.88 | 21.48% | 2.26% | 2.26% | (0.67)% | (0.67)% | 30% | $27,101 | ||||||||||||||||||||||||||||||||
2019 | $8.93 | 0.05 | 0.84 | 0.89 | — | — | — | $9.82 | 9.97% | 2.25% | 2.25% | 0.59% | 0.59% | 39% | $30,004 | ||||||||||||||||||||||||||||||||
2018 | $10.61 | (0.03) | (1.59) | (1.62) | — | (0.06) | (0.06) | $8.93 | (15.39)% | 2.18% | 2.29% | (0.29)% | (0.40)% | 36% | $31,871 | ||||||||||||||||||||||||||||||||
2017 | $7.63 | (0.08) | 3.06 | 2.98 | — | — | — | $10.61 | 39.06% | 2.16% | 2.48% | (0.79)% | (1.11)% | 47% | $24,972 | ||||||||||||||||||||||||||||||||
R Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $13.17 | (0.02) | 0.08 | 0.06 | (0.01) | — | (0.01) | $13.22 | 0.41% | 1.75% | 1.75% | (0.14)% | (0.14)% | 35% | $7,687 | ||||||||||||||||||||||||||||||||
2020 | $10.88 | (0.02) | 2.40 | 2.38 | (0.09) | — | (0.09) | $13.17 | 22.11% | 1.76% | 1.76% | (0.17)% | (0.17)% | 30% | $7,466 | ||||||||||||||||||||||||||||||||
2019 | $9.85 | 0.12 | 0.91 | 1.03 | — | — | — | $10.88 | 10.46% | 1.75% | 1.75% | 1.09% | 1.09% | 39% | $6,825 | ||||||||||||||||||||||||||||||||
2018 | $11.64 | 0.02 | (1.75) | (1.73) | — | (0.06) | (0.06) | $9.85 | (14.97)% | 1.68% | 1.79% | 0.21% | 0.10% | 36% | $5,825 | ||||||||||||||||||||||||||||||||
2017 | $8.33 | (0.02) | 3.33 | 3.31 | — | — | — | $11.64 | 39.74% | 1.68% | 2.00% | (0.31)% | (0.63)% | 47% | $4,811 |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Operating Expenses (before expense waiver) | Net Investment Income (Loss) | Net Investment Income (Loss) (before expense waiver) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||||||
R5 Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $13.98 | 0.06 | 0.11 | 0.17 | (0.11) | — | (0.11) | $14.04 | 1.09% | 1.05% | 1.05% | 0.56% | 0.56% | 35% | $12,172 | ||||||||||||||||||||||||||||||||
2020 | $11.57 | 0.06 | 2.54 | 2.60 | (0.19) | — | (0.19) | $13.98 | 22.92% | 1.06% | 1.06% | 0.53% | 0.53% | 30% | $3,863 | ||||||||||||||||||||||||||||||||
2019 | $10.47 | 0.20 | 0.97 | 1.17 | (0.07) | — | (0.07) | $11.57 | 11.19% | 1.05% | 1.05% | 1.79% | 1.79% | 39% | $2,444 | ||||||||||||||||||||||||||||||||
2018 | $12.32 | 0.12 | (1.86) | (1.74) | (0.05) | (0.06) | (0.11) | $10.47 | (14.33)% | 0.98% | 1.09% | 0.91% | 0.80% | 36% | $4,521 | ||||||||||||||||||||||||||||||||
2017(3) | $9.78 | 0.03 | 2.51 | 2.54 | — | — | — | $12.32 | 25.97% | 0.92%(4) | 1.27%(4) | 0.78%(4) | 0.43%(4) | 47%(5) | $46 | ||||||||||||||||||||||||||||||||
R6 Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $13.98 | 0.11 | 0.07 | 0.18 | (0.13) | — | (0.13) | $14.03 | 1.24% | 0.90% | 0.90% | 0.71% | 0.71% | 35% | $851,240 | ||||||||||||||||||||||||||||||||
2020 | $11.58 | 0.08 | 2.54 | 2.62 | (0.22) | — | (0.22) | $13.98 | 23.13% | 0.91% | 0.91% | 0.68% | 0.68% | 30% | $570,868 | ||||||||||||||||||||||||||||||||
2019 | $10.48 | 0.23 | 0.96 | 1.19 | (0.09) | — | (0.09) | $11.58 | 11.45% | 0.90% | 0.90% | 1.94% | 1.94% | 39% | $405,776 | ||||||||||||||||||||||||||||||||
2018 | $12.34 | 0.12 | (1.84) | (1.72) | (0.08) | (0.06) | (0.14) | $10.48 | (14.28)% | 0.83% | 0.94% | 1.06% | 0.95% | 36% | $239,031 | ||||||||||||||||||||||||||||||||
2017 | $8.81 | 0.06 | 3.53 | 3.59 | (0.06) | — | (0.06) | $12.34 | 40.98% | 0.83% | 1.15% | 0.54% | 0.22% | 47% | $92,470 |
Notes to Financial Highlights |
(1)Computed using average shares outstanding throughout the period.
(2)Total returns are calculated based on the net asset value of the last business day and do not reflect applicable sales charges, if any. Total returns for periods less than one year are not annualized.
(3)April 10, 2017 (commencement of sale) through November 30, 2017.
(4)Annualized.
(5)Portfolio turnover is calculated at the fund level. Percentage indicated was calculated for the year ended November 30, 2017.
(6)Per-share amount was less than $0.005.
See Notes to Financial Statements.
Report of Independent Registered Public Accounting Firm |
To the Shareholders and the Board of Directors of American Century World Mutual Funds, Inc.:
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Emerging Markets Fund (the “Fund”), one of the funds constituting the American Century World Mutual Funds, Inc., as of November 30, 2021, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of Emerging Markets Fund of the American Century World Mutual Funds, Inc. as of November 30, 2021, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund’s financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. 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, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of November 30, 2021, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
/s/ Deloitte & Touche LLP
Kansas City, Missouri
January 19, 2022
We have served as the auditor of one or more American Century investment companies since 1997.
28
Management |
The Board of Directors
The individuals listed below serve as directors of the funds. Each director will continue to serve in this capacity until death, retirement, resignation or removal from office. The board has adopted a mandatory retirement age for directors who are not “interested persons,” as that term is defined in the Investment Company Act (independent directors). Independent directors shall retire by December 31 of the year in which they reach their 75th birthday.
Jonathan S. Thomas is an “interested person” because he currently serves as President and Chief Executive Officer of American Century Companies, Inc. (ACC), the parent company of American Century Investment Management, Inc. (ACIM or the advisor). The other directors (more than three-fourths of the total number) are independent. They are not employees, directors or officers of, and have no financial interest in, ACC or any of its wholly owned, direct or indirect, subsidiaries, including ACIM, American Century Investment Services, Inc. (ACIS) and American Century Services, LLC (ACS), and they do not have any other affiliations, positions or relationships that would cause them to be considered “interested persons” under the Investment Company Act. The directors serve in this capacity for seven (in the case of Jonathan S. Thomas, 16; and Stephen E. Yates, 8) registered investment companies in the American Century Investments family of funds.
The following table presents additional information about the directors. The mailing address for each director is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Thomas W. Bunn (1953) | Director | Since 2017 | Retired | 72 | SquareTwo Financial; Barings (formerly Babson Capital Funds Trust) (2013 to 2016) | ||||||||||||
Chris H. Cheesman (1962) | Director | Since 2019 | Retired. Senior Vice President & Chief Audit Executive, AllianceBernstein (1999 to 2018) | 72 | Alleghany Corporation | ||||||||||||
Barry Fink (1955) | Director | Since 2012 (independent since 2016) | Retired | 72 | None | ||||||||||||
Rajesh K. Gupta (1960) | Director | Since 2019 | Partner Emeritus, SeaCrest Investment Management and SeaCrest Wealth Management (2019 to Present); Chief Executive Officer and Chief Investment Officer, SeaCrest Investment Management (2006 to 2019); Chief Executive Officer and Chief Investment Officer, SeaCrest Wealth Management (2008 to 2019) | 72 | None |
29
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Lynn Jenkins (1963) | Director | Since 2019 | Consultant, LJ Strategies (2019 to present); United States Representative, U.S. House of Representatives (2009 to 2018) | 72 | MGP Ingredients, Inc. (2019 to 2021) | ||||||||||||
Jan M. Lewis (1957) | Director | Since 2011 | Retired | 72 | None | ||||||||||||
John R. Whitten(1) (1946) | Director | Since 2008 | Retired | 72 | Onto Innovation Inc. (2019 to 2020); Rudolph Technologies, Inc. (2006 to 2019) | ||||||||||||
Stephen E. Yates (1948) | Director and Chairman of the Board | Since 2012 (Chairman since 2018) | Retired | 108 | None | ||||||||||||
Interested Director | |||||||||||||||||
Jonathan S. Thomas (1963) | Director | Since 2007 | President and Chief Executive Officer, ACC (2007 to present). Also serves as Chief Executive Officer, ACS; Director, ACC and other ACC subsidiaries | 146 | None |
(1) Effective December 31, 2021, John R. Whitten retired from the Board of Directors.
The Statement of Additional Information has additional information about the fund's directors and is available without charge, upon request, by calling 1-800-345-2021.
30
Officers
The following table presents certain information about the executive officers of the funds. Each officer serves as an officer for each of the 16 (in the case of Robert J. Leach, 15) investment companies in the American Century family of funds. No officer is compensated for his or her service as an officer of the funds. The listed officers are interested persons of the funds and are appointed or re-appointed on an annual basis. The mailing address for each officer listed below is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Offices with the Funds | Principal Occupation(s) During the Past Five Years | ||||||
Patrick Bannigan (1965) | President since 2019 | Executive Vice President and Director, ACC (2012 to present); Chief Financial Officer, Chief Accounting Officer and Treasurer, ACC (2015 to present). Also serves as President, ACS; Vice President, ACIM; Chief Financial Officer, Chief Accounting Officer and/or Director, ACIM, ACS and other ACC subsidiaries | ||||||
R. Wes Campbell (1974) | Chief Financial Officer and Treasurer since 2018 | Vice President, ACS, (2020 to present); Investment Operations and Investment Accounting, ACS (2000 to present) | ||||||
Amy D. Shelton (1964) | Chief Compliance Officer and Vice President since 2014 | Chief Compliance Officer, American Century funds, (2014 to present); Chief Compliance Officer, ACIM (2014 to present); Chief Compliance Officer, ACIS (2009 to present). Also serves as Vice President, ACIS | ||||||
John Pak (1968) | General Counsel and Senior Vice President since 2021 | General Counsel and Senior Vice President, ACC (2021 to present). Also serves as General Counsel and Senior Vice President, ACIM, ACS and ACIS. Chief Legal Officer of Investment and Wealth Management, The Bank of New York Mellon (2014 to 2021) | ||||||
C. Jean Wade (1964) | Vice President since 2012 | Senior Vice President, ACS (2017 to present); Vice President, ACS (2000 to 2017) | ||||||
Robert J. Leach (1966) | Vice President since 2006 | Vice President, ACS (2000 to present) | ||||||
David H. Reinmiller (1963) | Vice President since 2000 | Attorney, ACC (1994 to present). Also serves as Vice President, ACIM and ACS | ||||||
Ward D. Stauffer (1960) | Secretary since 2005 | Attorney, ACC (2003 to present) |
31
Approval of Management Agreement |
At a meeting held on June 30, 2021, the Fund’s Board of Directors (the "Board") unanimously approved the renewal of the management agreement pursuant to which American Century Investment Management, Inc. (the “Advisor”) acts as the investment advisor for the Fund. Under Section 15(c) of the Investment Company Act, contracts for investment advisory services are required to be reviewed, evaluated, and approved by a majority of a fund’s directors (the “Directors”), including a majority of the independent Directors, each year.
Prior to its consideration of the renewal of the management agreement, the Directors requested and reviewed extensive data and information compiled by the Advisor and certain independent providers of evaluation data concerning the Fund and the services provided to the Fund by the Advisor. This review was in addition to the oversight and evaluation undertaken by the Board and its committees on a continual basis and the information received was supplemental to the extensive information that the Board and its committees receive and consider throughout the year.
In connection with its consideration of the renewal of the management agreement, the Board’s review and evaluation of the services provided by the Advisor and its affiliates included, but was not limited to, the following:
•the nature, extent, and quality of investment management, shareholder services, and other services provided and to be provided to the Fund including without limitation portfolio management and trading services, shareholder and intermediary services, compliance and legal services, fund accounting and financial reporting, and fund share distribution;
•the wide range of other programs and services provided and to be provided to the Fund and its shareholders on a routine and non-routine basis;
•the Fund’s investment performance, including data comparing the Fund's performance to appropriate benchmarks and/or a peer group of other mutual funds with similar investment objectives and strategies;
•the cost of owning the Fund compared to the cost of owning similar funds;
•the compliance policies, procedures, and regulatory experience of the Advisor and the Fund's service providers;
•the Advisor’s strategic plans, COVID-19 pandemic response, vendor management practices, and social justice initiatives;
•the Advisor’s business continuity plans and cyber security practices;
•financial data showing the cost of services provided to the Fund, the profitability of the Fund to the Advisor, and the overall profitability of the Advisor;
•possible economies of scale associated with the Advisor’s management of the Fund and other accounts;
•services provided and charges to the Advisor's other investment management clients;
•acquired fund fees and expenses;
•payments and practices in connection with financial intermediaries holding shares of the Fund and the services provided by intermediaries in connection therewith; and
•possible collateral benefits to the Advisor from the management of the Fund.
The Board held two meetings to consider the renewal. The independent Directors also met in private session three times to review and discuss the information provided in response to their request. The independent Directors held active discussions with the Advisor regarding the renewal of the management agreement, requesting supplemental information, and reviewing information provided by the Advisor in response thereto. The independent Directors had the benefit of the advice of their independent counsel throughout the process.
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Factors Considered
The Directors considered all of the information provided by the Advisor, the independent data providers, and independent counsel in connection with the approval. They determined that the information was sufficient for them to evaluate the management agreement for the Fund. In connection with their review, the Directors did not identify any single factor as being all-important or controlling, and each Director may have attributed different levels of importance to different factors. In deciding to renew the management agreement, the Board based its decision on a number of factors, including without limitation the following:
Nature, Extent and Quality of Services — Generally. Under the management agreement, the Advisor is responsible for providing or arranging for all services necessary for the operation of the Fund. The Board noted that the Advisor provides or arranges at its own expense a wide variety of services which include the following:
•constructing and designing the Fund
•portfolio research and security selection
•initial capitalization/funding
•securities trading
•Fund administration
•custody of Fund assets
•daily valuation of the Fund’s portfolio
•liquidity monitoring and management
•risk management, including cyber security
•shareholder servicing and transfer agency, including shareholder confirmations, recordkeeping, and communications
•legal services (except the independent Directors’ counsel)
•regulatory and portfolio compliance
•financial reporting
•marketing and distribution (except amounts paid by the Fund under Rule 12b-1 plans)
The Board noted that many of these services have expanded over time in terms of both quantity and complexity in response to shareholder demands, competition in the industry, changing distribution channels, and the changing regulatory environment.
Investment Management Services. The nature of the investment management services provided to the Fund is quite complex and allows Fund shareholders access to professional money management, instant diversification of their investments within an asset class, the opportunity to easily diversify among asset classes by investing in or exchanging among various American Century Investments funds, and liquidity. In evaluating investment performance, the Board expects the Advisor to manage the Fund in accordance with its investment objectives and approved strategies. Further, the Directors recognize that the Advisor has an obligation to monitor trading activities, and in particular to seek the best execution of fund trades, and to evaluate the use of and payment for research. In providing these services, the Advisor utilizes teams of investment professionals (portfolio managers, analysts, research assistants, and securities traders) who require extensive information technology, research, training, compliance, and other systems to conduct their business. The Board, directly and through its Fund Performance Review Committee, provides oversight of the investment performance process. It regularly reviews investment performance information for the Fund, together with comparative information for appropriate benchmarks and/or peer groups of similarly-managed funds, over different time horizons. The Directors also review investment performance information during the management agreement renewal process. If performance concerns are identified, the Fund receives special reviews until performance improves, during which the Board discusses with the Advisor the reasons for such results (e.g., market conditions, security selection) and any efforts being undertaken to improve performance. The Fund’s performance was above its benchmark for the one-, three-, five-, and ten-year periods reviewed by the Board. The Board found the investment management services provided by the Advisor to the Fund to be satisfactory and consistent with the management agreement.
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Shareholder and Other Services. Under the management agreement, the Advisor provides the Fund with a comprehensive package of transfer agency, shareholder, and other services. The Board, directly and through its various committees, regularly reviews reports and evaluations of such services at its regular meetings. These reports include, but are not limited to, information regarding the operational efficiency and accuracy of the shareholder and transfer agency services provided, staffing levels, shareholder satisfaction, technology support (including cyber security), new products and services offered to Fund shareholders, securities trading activities, portfolio valuation services, auditing services, and legal and operational compliance activities. The Board found the services provided by the Advisor to the Fund under the management agreement to be competitive and of high quality.
Costs of Services and Profitability. The Advisor provides detailed information concerning its cost of providing various services to the Fund, its profitability in managing the Fund (pre- and post-distribution), its overall profitability, and its financial condition. The Directors have reviewed with the Advisor the methodology used to prepare this financial information. This information is considered in evaluating the Advisor’s financial condition, its ability to continue to provide services under the management agreement, and the reasonableness of the current management fee. The Board concluded that the Advisor’s profits were reasonable in light of the services provided to the Fund.
Ethics. The Board generally considers the Advisor’s commitment to providing quality services to shareholders and to conducting its business ethically. They noted that the Advisor’s practices generally meet or exceed industry best practices.
Economies of Scale. The Board also reviewed information provided by the Advisor regarding the possible existence of economies of scale in connection with the management of the Fund. The Board concluded that economies of scale are difficult to measure and predict with precision, especially on a fund-by-fund basis. The Board concluded that the Advisor is sharing economies of scale, to the extent they exist, through its competitive fee structure, offering competitive fees from fund inception, and through reinvestment in its business, infrastructure, investment capabilities and initiatives to provide shareholders additional content and services.
Comparison to Other Funds’ Fees. The management agreement provides that the Fund pays the Advisor a single, all-inclusive (or unified) management fee for providing all services necessary for the management and operation of the Fund, other than brokerage expenses, expenses attributable to short sales, taxes, interest, extraordinary expenses, fees and expenses of the Fund’s independent Directors (including their independent legal counsel), and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the Investment Company Act. Under the unified fee structure, the Advisor is responsible for providing all investment advisory, custody, audit, administrative, compliance, recordkeeping, marketing and shareholder services, or arranging and supervising third parties to provide such services. By contrast, most other funds are charged a variety of fees, including an investment advisory fee, a transfer agency fee, an administrative fee, distribution charges, and other expenses. Other than their investment advisory fees and any applicable Rule 12b-1 distribution fees, all other components of the total fees charged by these other funds may be increased without shareholder approval. The Board believes the unified fee structure is a benefit to Fund shareholders because it clearly discloses to shareholders the cost of owning Fund shares, and, since the unified fee cannot be increased without a vote of Fund shareholders, it shifts to the Advisor the risk of increased costs of operating the Fund and provides a direct incentive to minimize administrative inefficiencies. Part of the Board’s analysis of fee levels involves reviewing certain evaluative data compiled by an independent provider comparing the Fund’s unified fee to the total expense ratios of its peers. The unified fee charged to shareholders of the Fund was below the median of the total expense ratios of the Fund’s peer expense universe. In addition, the Board reviewed the Fund’s position relative to the narrower set of its expense group peers. The Board concluded that the management fee paid by the Fund to the Advisor under the management agreement is reasonable in light of the services provided to the Fund.
Comparison to Fees and Services Provided to Other Clients of the Advisor. The Board also requested and received information from the Advisor concerning the nature of the services, fees, costs, and profitability of its advisory services to advisory clients other than the Fund. They observed that these varying types of client accounts require different services and involve different
34
regulatory and entrepreneurial risks than the management of the Fund. The Board analyzed this information and concluded that the fees charged and services provided to the Fund were reasonable by comparison.
Payments to Intermediaries. The Directors also requested and received a description of payments made to intermediaries by the Fund and the Advisor and services provided in response thereto. These payments include various payments made by the Fund or the Advisor to different types of intermediaries and recordkeepers for distribution and service activities provided for the Fund. The Directors reviewed such information and received representations from the Advisor that all such payments by the Fund were made pursuant to the Fund's Rule 12b-1 Plan and that all such payments by the Advisor were made from the Advisor’s resources and reasonable profits. The Board found such payments to be reasonable in scope and purpose.
Collateral or “Fall-Out” Benefits Derived by the Advisor. The Board considered the possible existence of collateral benefits the Advisor may receive as a result of its relationship with the Fund. They concluded that the Advisor’s primary business is managing funds and it generally does not use fund or shareholder information to generate profits in other lines of business, and therefore does not derive any significant collateral benefits from them. To the extent there are potential collateral benefits, the Board has been advised and has taken this into consideration in its review of the management contract with the Fund. The Board noted that additional assets from other clients may offer the Advisor some benefit from increased leverage with service providers and counterparties. Additionally, the Advisor may receive proprietary research from broker-dealers that execute fund portfolio transactions, which the Board concluded is likely to benefit other clients of the Advisor, as well as Fund shareholders. The Board also determined that the Advisor is able to provide investment management services to certain clients other than the Fund, at least in part, due to its existing infrastructure built to serve the fund complex. The Board concluded that appropriate allocation methodologies had been employed to assign resources and the cost of those resources to these other clients.
Existing Relationship. The Board also considered whether there was any reason for not continuing the existing arrangement with the Advisor. In this regard, the Board was mindful of the potential disruptions of the Fund’s operations and various risks, uncertainties, and other effects that could occur as a result of a decision not to continue such relationship. In particular, the Board recognized that most shareholders have invested in the Fund on the strength of the Advisor’s industry standing and reputation and in the expectation that the Advisor will have a continuing role in providing advisory services to the Fund.
Conclusion of the Directors. As a result of this process, the Board, including all of the independent Directors, taking into account all of the factors discussed above and the information provided by the Advisor and others in connection with its review and throughout the year, determined that the management fee is fair and reasonable in light of the services provided and that the investment management agreement between the Fund and the Advisor should be renewed.
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Additional Information |
Retirement Account Information
As required by law, distributions you receive from certain retirement accounts are subject to federal income tax withholding, unless you elect not to have withholding apply*. Tax will be withheld on the total amount withdrawn even though you may be receiving amounts that are not subject to withholding, such as nondeductible contributions. In such case, excess amounts of withholding could occur. You may adjust your withholding election so that a greater or lesser amount will be withheld.
If you don’t want us to withhold on this amount, you must notify us to not withhold the federal income tax. You may notify us in writing or in certain situations by telephone or through other electronic means. For systematic withdrawals, your withholding election will remain in effect until revoked or changed by filing a new election. You have the right to revoke your election at any time and change your withholding percentage for future distributions.
Remember, even if you elect not to have income tax withheld, you are liable for paying income tax on the taxable portion of your withdrawal. If you elect not to have income tax withheld or you don’t have enough income tax withheld, you may be responsible for payment of estimated tax. You may incur penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. You can reduce or defer the income tax on a distribution by directly or indirectly rolling such distribution over to another IRA or eligible plan. You should consult your tax advisor for additional information.
State tax will be withheld if, at the time of your distribution, your address is within one of the mandatory withholding states and you have federal income tax withheld (or as otherwise required by state law). State taxes will be withheld from your distribution in accordance with the respective state rules.
*Some 403(b), 457 and qualified retirement plan distributions may be subject to 20% mandatory withholding, as they are subject to special tax and withholding rules. Your plan administrator or plan sponsor is required to provide you with a special tax notice explaining those rules at the time you request a distribution. If applicable, federal and/or state taxes may be withheld from your distribution amount.
Proxy Voting Policies
A description of the policies that the fund's investment advisor uses in exercising the voting rights associated with the securities purchased and/or held by the fund is available without charge, upon request, by calling 1-800-345-2021. It is also available on American Century Investments’ website at americancentury.com/proxy and on the Securities and Exchange Commission’s website at sec.gov. Information regarding how the investment advisor voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on americancentury.com/proxy. It is also available at sec.gov.
Quarterly Portfolio Disclosure
The fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. These portfolio holdings are available on the fund's website at americancentury.com and, upon request, by calling 1-800-345-2021. The fund’s Form N-PORT reports are available on the SEC’s website at sec.gov.
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Other Tax Information
The following information is provided pursuant to provisions of the Internal Revenue Code.
The fund hereby designates up to the maximum amount allowable as qualified dividend income for
the fiscal year ended November 30, 2021.
For the fiscal year ended November 30, 2021, the fund intends to pass through to shareholders
foreign source income of $59,934,700 and foreign taxes paid of $5,820,733, or up to the maximum
amount allowable, as a foreign tax credit. Foreign source income and foreign tax expense per
outstanding share on November 30, 2021 are $0.2570 and $0.0250, respectively.
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Notes |
38
Notes |
39
Notes |
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Contact Us | americancentury.com | |||||||
Automated Information Line | 1-800-345-8765 | |||||||
Investor Services Representative | 1-800-345-2021 or 816-531-5575 | |||||||
Investors Using Advisors | 1-800-378-9878 | |||||||
Business, Not-For-Profit, Employer-Sponsored Retirement Plans | 1-800-345-3533 | |||||||
Banks and Trust Companies, Broker-Dealers, Financial Professionals, Insurance Companies | 1-800-345-6488 | |||||||
Telecommunications Relay Service for the Deaf | 711 | |||||||
American Century World Mutual Funds, Inc. | ||||||||
Investment Advisor: American Century Investment Management, Inc. Kansas City, Missouri | ||||||||
This report and the statements it contains are submitted for the general information of our shareholders. The report is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. | ||||||||
©2022 American Century Proprietary Holdings, Inc. All rights reserved. CL-ANN-91030 2201 |
![image37.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image37.jpg)
Annual Report | |||||
November 30, 2021 | |||||
Emerging Markets Small Cap Fund | |||||
Investor Class (AECVX) | |||||
I Class (AECSX) | |||||
A Class (AECLX) | |||||
C Class (AECHX) | |||||
R Class (AECMX) | |||||
R6 Class (AECTX) |
Table of Contents |
President’s Letter | |||||
Performance | |||||
Portfolio Commentary | |||||
Fund Characteristics | |||||
Shareholder Fee Example | |||||
Schedule of Investments | |||||
Statement of Assets and Liabilities | |||||
Statement of Operations | |||||
Statement of Changes in Net Assets | |||||
Notes to Financial Statements | |||||
Financial Highlights | |||||
Report of Independent Registered Public Accounting Firm | |||||
Management | |||||
Approval of Management Agreement | |||||
Additional Information |
Any opinions expressed in this report reflect those of the author as of the date of the report, and do not necessarily represent the opinions of American Century Investments® or any other person in the American Century Investments organization. Any such opinions are subject to change at any time based upon market or other conditions and American Century Investments disclaims any responsibility to update such opinions. These opinions may not be relied upon as investment advice and, because investment decisions made by American Century Investments funds are based on numerous factors, may not be relied upon as an indication of trading intent on behalf of any American Century Investments fund. Security examples are used for representational purposes only and are not intended as recommendations to purchase or sell securities. Performance information for comparative indices and securities is provided to American Century Investments by third party vendors. To the best of American Century Investments’ knowledge, such information is accurate at the time of printing.
President’s Letter |
![image30a.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image30a.jpg)
Dear Investor:
Thank you for reviewing this annual report for the period ended November 30, 2021. Annual reports help convey important information about fund returns, including market factors that affected performance. For additional investment insights, please visit americancentury.com.
Global Stocks Advanced Despite Lingering and New Challenges
Global stocks broadly delivered solid gains for the 12-month period, even as pandemic-related challenges persisted. Improving economic data, along with central bank and government support and positive vaccine developments, helped boost corporate earnings and promote investor optimism. The U.S. generally outpaced other nations. Virus outbreaks and slower vaccine rollouts, particularly in emerging markets, led to lingering lockdowns in some regions.
As the period progressed, steady economic gains combined with ongoing monetary and fiscal support, rising energy prices and severe supply chain disruptions pushed global interest rates and inflation higher. In the U.S., year-over-year headline inflation climbed to 6.8% in November 2021, the largest 12-month increase in nearly 40 years. Similarly, inflation in the eurozone hit a 30-year high, while prices in the U.K. climbed to their highest level in 10 years.
Late in the period, the Federal Reserve began tapering its bond buying while adopting a more hawkish rate-tightening outlook amid surging inflation. However, central banks in Europe and the U.K. maintained their supportive programs, expressing concerns about slowing global growth outlooks. Meanwhile, the emergence of a new COVID-19 variant in late November triggered a steep sell-off among global stocks to end the reporting period.
Despite mounting inflation worries and late-period volatility, global stocks delivered solid performance for the full 12 months, highlighted by strong gains in developed markets. Emerging markets stocks generally delivered more modest returns.
Several Factors Shaping Market Dynamics
The return to pre-pandemic life is progressing, albeit somewhat cautiously due to COVID-19’s lingering effects. As the economy and markets respond to this fluid backdrop, investors will face opportunities and ongoing challenges. Economic growth, inflation, the virus’s trajectory, supply chain normalization and fiscal and monetary policy likely will sway market dynamics.
We appreciate your confidence in us during these extraordinary times. Our firm has a long history of helping clients weather unpredictable markets, and we’re confident we will continue to meet today’s challenges.
Sincerely,
![image23.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image23.jpg)
Jonathan Thomas
President and Chief Executive Officer
American Century Investments
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Performance |
Total Returns as of November 30, 2021 | |||||||||||||||||
Average Annual Returns | |||||||||||||||||
Ticker Symbol | 1 year | 5 years | Since Inception | Inception Date | |||||||||||||
Investor Class | AECVX | 20.69% | 11.79% | 11.23% | 4/7/16 | ||||||||||||
MSCI Emerging Markets Small Cap Index | — | 22.75% | 10.51% | 9.71% | — | ||||||||||||
I Class | AECSX | 21.06% | 12.04% | 11.47% | 4/7/16 | ||||||||||||
A Class | AECLX | 4/7/16 | |||||||||||||||
No sales charge | 20.41% | 11.52% | 10.96% | ||||||||||||||
With sales charge | 13.52% | 10.20% | 9.80% | ||||||||||||||
C Class | AECHX | 19.58% | 10.70% | 10.14% | 4/7/16 | ||||||||||||
R Class | AECMX | 20.16% | 11.26% | 10.69% | 4/7/16 | ||||||||||||
R6 Class | AECTX | 21.15% | 12.19% | 11.62% | 4/7/16 |
Sales charges include initial sales charges and contingent deferred sales charges (CDSCs), as applicable. A Class shares have a 5.75% maximum initial sales charge and may be subject to a maximum CDSC of 1.00%. C Class shares redeemed within 12 months of purchase are subject to a maximum CDSC of 1.00%. The SEC requires that mutual funds provide performance information net of maximum sales charges in all cases where charges could be applied.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
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Growth of $10,000 Over Life of Class | ||
$10,000 investment made April 7, 2016 | ||
Performance for other share classes will vary due to differences in fee structure. |
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Value on November 30, 2021 | |||||
Investor Class — $18,252 | |||||
MSCI Emerging Markets Small Cap Index — $16,882 | |||||
Total Annual Fund Operating Expenses | |||||||||||||||||
Investor Class | I Class | A Class | C Class | R Class | R6 Class | ||||||||||||
1.40% | 1.20% | 1.65% | 2.40% | 1.90% | 1.05% |
The total annual fund operating expenses shown is as stated in the fund’s prospectus current as of the date of this report. The prospectus may vary from the expense ratio shown elsewhere in this report because it is based on a different time period, includes acquired fund fees and expenses, and, if applicable, does not include fee waivers or expense reimbursements.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
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Portfolio Commentary |
Portfolio Managers: Patricia Ribeiro and Sherwin Soo
Performance Summary
Emerging Markets Small Cap returned 20.69%* for the 12 months ended November 30, 2021. The fund’s benchmark, the MSCI Emerging Markets Small Cap Index, returned 22.75% for the same period.
The fund underperformed its benchmark during the period, during which emerging markets faced several significant challenges, including regulatory pressure on Chinese growth stocks, the damage from COVID-19 variants and persistent inflationary pressures. The shifting inflation narrative, which supported cyclical sectors and drove value stocks to outperform growth, weighed on our positioning. The sharp (and continuous) rise in value was challenging for our investment approach as a growth manager. From a sector perspective, stock selection and an underweight, relative to the benchmark, for most of the year in the materials sector was a key driver of underperformance. An overweight to, and stock selection in, consumer discretionary also detracted from relative results, along with security selection in utilities. Conversely, stock choices in financials bolstered relative performance. Underweights and stock selection in health care and real estate also contributed significantly. Regionally, China was the primary detractor, due to a combination of stock choices and an overweight to the market. Security selection drove detraction in Taiwan and Indonesia. Those relative losses were partially offset by stock selection in South Korea, Russia and the Philippines.
Materials and Consumer Discretionary Drive Underperformance
Holdings in the materials sector were the primary drivers of the fund’s underperformance over the 12-month period. Selection in the chemicals and metals and mining industries weighed on returns. An underweight to chemicals and an off-benchmark position in composite materials manufacturer Han Kuk Carbon were key drivers. Han Kuk Carbon declined amid weaker guidance and expectations for weaker earnings due to slower new-build demand for liquefied natural gas carriers, which has been weaker than expected and led to slower orders. In metals and mining, global resources company MMG was a notable detractor. Its flagship copper operation, Las Bambas, is to cease production after failed last-minute attempts to resolve issues with local residents who are blocking the road used by the mine. Earnings estimates were lowered to reflect lower production and higher costs at Las Bambas, as well as uncertainty as to how long the mine could be down. We exited the position.
Automotive retailer China Yongda Automobiles Services Holdings was a notable detractor in consumer discretionary. The stock faced headwinds due to signs of slowing economic growth and broader equity market volatility. Despite increased near-term uncertainty, we believe it remains well positioned for long-term growth. Brazil-based travel platform CVC Brasil Operadora e Agencia de Viagens declined as visibility on international travel remained fairly low as the risk of pandemic-related restrictions will likely linger into 2022. As government crackdowns pressured the Chinese education sector, investors grew concerned that China East Education Holdings’ enrollment could be negatively impacted, and the stock weighed on relative performance.
Utilities also detracted, largely due to index constituents we did not own. Natural gas distributor Indraprastha Gas, an off-benchmark holding, weighed on returns amid concerns over near-term margin risk. We exited the position. Elsewhere, notable detractors included Alchip Technologies, HMM (lack of exposure), Bank BTPN Syariah and Vnet Group. Alchip, the semiconductor foundry company, was a strong contributor in early 2021, but gave back some gains after a major customer was blacklisted by the U.S. Department of Commerce for national security reasons. BTPN Syariah’s shares declined as loan growth remained weak. Vnet, China’s leading carrier-neutral
*All fund returns referenced in this commentary are for Investor Class shares. Performance for other share classes will vary due to differences in fee structure; when Investor Class performance exceeds that of the fund’s benchmark, other share classes may not. See page 3 for returns for all share classes.
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internet data center operator, lost ground amid consensus downgrades due to stagnant wholesale customer progress as the data center industry entered a period of slowing customer demand. We exited BTPN Syariah and Vnet.
Financials a Key Contributor
Financials holdings substantially bolstered relative results, driven by stock selection across the capital markets and banking industries. Central Depository Services India was a key contributor in capital markets, as growth in many segments, especially new account openings, drove higher revenues, net profits and market share gains. Among bank stocks, overweight positions in TCS Group Holding and Banco Inter drove relative gains. TCS, the parent company of online-only Tinkoff Bank, advanced amid increased earnings expectations, factoring in faster growth of small and medium-sized business customers and loans. TCS’ guidance implied strong loan growth through 2021, with room for momentum to continue into 2022. Banco Inter, another online lender, posted strong results that helped raise earnings estimates as its operating momentum continued to build, with a larger client base and greater engagement.
Contribution from health care centered on underweight positioning and lack of exposure to numerous index constituents. The real estate sector’s largest individual contributor was Prestige Estates Projects. The property developer advanced amid reduced cost of capital for residential and office projects due to its improved balance sheet. The demand and pricing environment has improved, together with a recovery in office leasing.
Other notable contributors included battery materials supplier Ecopro BM, engineering services company L&T Technology Services and copper foil maker Iljin Materials. Ecopro benefited from a strong growth path supported by increasing revenue contribution from high-margin nickel products and continuing capacity expansion. Ecopro gained as key customers, including SK Innovation and Ford Motor Co., announced plans for new battery plants. L&T reported strong sets of numbers and raised revenue guidance. The company’s margins improved as a result of a shift toward more digital engineering as well as operational efficiency initiatives. Iljin Materials was a major beneficiary of the rapid increase in global electric vehicle penetration, and we believe it is positioned for earnings growth due to strong downstream demand from battery makers.
Outlook
We remain constructive on emerging markets (EM) equities based on consistent progress against COVID-19. EM continues to lag behind developed markets on vaccinations; however, repeat waves and variants will likely be less economically disruptive with increased access to vaccinations and therapeutics. In addition, China will likely prioritize growth and stability in 2022 rather than regulatory tightening. Additional catalysts for 2022 include the restoration of EM’s growth premium to developed markets. These points, coupled with attractive valuations, support our constructive view.
Improving vaccination and caseload data continues to boost the outlook for EM, despite variants, in our view. Vaccine rates have improved across EM, notably in major markets such as Brazil and India. Increased vaccine supply and faster rollout should continue to reduce new case and hospitalization levels, spurring economic activity as economies more fully reopen.
Secular trends and the ongoing economic recovery continue to support information technology, consumer positioning and cyclicals. Digitalization, cloud-based computing and the shift to online continue to support technology, while the removal of mobility restrictions and economic reopening are benefiting select consumer-facing names and cyclicals.
Regional and sector differences continue. Recovery rates remain staggered across EM, depending upon each region’s success in dealing with COVID-19. We believe growth momentum will likely improve in those economies that continue to emerge from the pandemic. In our view, China will likely perform better in 2022 as the regulatory environment improves. Meanwhile, EM countries outside of North Asia, such as Europe, the Middle East and Africa (EMEA) and Latin America, where recovery data are not fully factored in, may have more room to recover.
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Fund Characteristics |
NOVEMBER 30, 2021 | |||||
Types of Investments in Portfolio | % of net assets | ||||
Common Stocks | 97.2% | ||||
Exchange-Traded Funds | 2.3% | ||||
Warrants | 0.1% | ||||
Rights | —* | ||||
Temporary Cash Investments | 0.6% | ||||
Other Assets and Liabilities | (0.2)% | ||||
*Category is less than 0.05% of total net assets. | |||||
Top Five Countries* | % of net assets | ||||
India | 22.7% | ||||
Taiwan | 18.6% | ||||
South Korea | 16.7% | ||||
China | 8.2% | ||||
Russia | 5.7% |
*Exposure indicated excludes Exchange-Traded Funds. The Schedule of Investments provides additional information on the fund's portfolio holdings.
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Shareholder Fee Example |
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption/exchange fees; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in your fund and to compare these costs with the ongoing cost of investing in other mutual funds.
The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period from May 29, 2021 to November 30, 2021.
Actual Expenses
The table provides information about actual account values and actual expenses for each class. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. First, identify the share class you own. Then simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
If you hold Investor Class shares of any American Century Investments fund, or I Class shares of the American Century Diversified Bond Fund, in an American Century Investments account (i.e., not through a financial intermediary or employer-sponsored retirement plan account), American Century Investments may charge you a $25.00 annual account maintenance fee if the value of those shares is less than $10,000. We will redeem shares automatically in one of your accounts to pay the $25.00 fee. In determining your total eligible investment amount, we will include your investments in all personal accounts (including American Century Investments brokerage accounts) registered under your Social Security number. Personal accounts include individual accounts, joint accounts, UGMA/UTMA accounts, personal trusts, Coverdell Education Savings Accounts and IRAs (including traditional, Roth, Rollover, SEP-, SARSEP- and SIMPLE-IRAs), and certain other retirement accounts. If you have only business, business retirement, employer-sponsored or American Century Investments brokerage accounts, you are currently not subject to this fee. If you are subject to the account maintenance fee, your account value could be reduced by the fee amount.
Hypothetical Example for Comparison Purposes
The table also provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each class of your fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of a fund’s share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption/exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
8
Beginning Account Value 5/29/21 | Ending Account Value 11/30/21 | Expenses Paid During Period(1) 5/29/21 - 11/30/21 | Annualized Expense Ratio(1) | |||||||||||
Actual | ||||||||||||||
Investor Class | $1,000 | $1,023.00 | $7.16 | 1.39% | ||||||||||
I Class | $1,000 | $1,024.70 | $6.14 | 1.19% | ||||||||||
A Class | $1,000 | $1,022.50 | $8.45 | 1.64% | ||||||||||
C Class | $1,000 | $1,018.60 | $12.29 | 2.39% | ||||||||||
R Class | $1,000 | $1,021.40 | $9.73 | 1.89% | ||||||||||
R6 Class | $1,000 | $1,025.30 | $5.37 | 1.04% | ||||||||||
Hypothetical | ||||||||||||||
Investor Class | $1,000 | $1,018.40 | $7.15 | 1.39% | ||||||||||
I Class | $1,000 | $1,019.42 | $6.12 | 1.19% | ||||||||||
A Class | $1,000 | $1,017.12 | $8.43 | 1.64% | ||||||||||
C Class | $1,000 | $1,013.30 | $12.26 | 2.39% | ||||||||||
R Class | $1,000 | $1,015.85 | $9.71 | 1.89% | ||||||||||
R6 Class | $1,000 | $1,020.18 | $5.35 | 1.04% |
(1)Expenses are equal to the class's annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 186, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. Annualized expense ratio reflects actual expenses, including any applicable fee waivers or expense reimbursements and excluding any acquired fund fees and expenses.
9
Schedule of Investments |
NOVEMBER 30, 2021
Shares | Value | |||||||
COMMON STOCKS — 97.2% | ||||||||
Brazil — 5.3% | ||||||||
Banco Inter SA | 19,482 | $ | 126,072 | |||||
CVC Brasil Operadora e Agencia de Viagens SA(1) | 34,800 | 83,876 | ||||||
Embraer SA, ADR(1) | 9,933 | 136,380 | ||||||
Petro Rio SA(1) | 40,600 | 145,086 | ||||||
Santos Brasil Participacoes SA(1) | 52,600 | 55,483 | ||||||
546,897 | ||||||||
China — 8.2% | ||||||||
China East Education Holdings Ltd.(1) | 30,000 | 31,351 | ||||||
China Education Group Holdings Ltd. | 44,000 | 80,939 | ||||||
China Lesso Group Holdings Ltd. | 33,000 | 47,924 | ||||||
China Suntien Green Energy Corp. Ltd., H Shares(2) | 79,000 | 55,274 | ||||||
China Yongda Automobiles Services Holdings Ltd. | 69,500 | 105,157 | ||||||
Chinasoft International Ltd.(1) | 98,000 | 162,942 | ||||||
CIFI Holdings Group Co. Ltd. | 88,570 | 48,151 | ||||||
Far East Horizon Ltd.(2) | 79,000 | 68,639 | ||||||
Li Ning Co. Ltd. | 12,500 | 141,382 | ||||||
Minth Group Ltd. | 12,000 | 55,732 | ||||||
Xinte Energy Co. Ltd., H Shares | 23,200 | 52,870 | ||||||
850,361 | ||||||||
Greece — 1.3% | ||||||||
JUMBO SA | 4,150 | 58,096 | ||||||
OPAP SA | 5,867 | 81,398 | ||||||
139,494 | ||||||||
India — 22.7% | ||||||||
AU Small Finance Bank Ltd.(1) | 5,543 | 80,878 | ||||||
Bata India Ltd. | 4,098 | 102,490 | ||||||
Berger Paints India Ltd. | 5,729 | 57,303 | ||||||
Central Depository Services India Ltd. | 12,095 | 233,643 | ||||||
Crompton Greaves Consumer Electricals Ltd. | 24,050 | 143,589 | ||||||
JK Cement Ltd. | 4,279 | 184,678 | ||||||
Jubilant Foodworks Ltd. | 2,612 | 127,177 | ||||||
L&T Technology Services Ltd. | 4,385 | 307,470 | ||||||
Larsen & Toubro Infotech Ltd. | 1,321 | 119,480 | ||||||
MakeMyTrip Ltd.(1) | 4,784 | 116,490 | ||||||
Persistent Systems Ltd. | 1,452 | 79,941 | ||||||
Prestige Estates Projects Ltd. | 34,509 | 193,539 | ||||||
Shriram Transport Finance Co. Ltd. | 6,110 | 114,479 | ||||||
Torrent Pharmaceuticals Ltd. | 1,345 | 54,385 | ||||||
Varun Beverages Ltd. | 10,296 | 122,053 | ||||||
VIP Industries Ltd.(1) | 18,250 | 135,958 | ||||||
WNS Holdings Ltd., ADR(1) | 1,598 | 134,344 | ||||||
Zydus Wellness Ltd. | 1,995 | 52,057 | ||||||
2,359,954 | ||||||||
Indonesia — 2.6% | ||||||||
Ace Hardware Indonesia Tbk PT | 1,096,000 | 99,772 | ||||||
Jasa Marga Persero Tbk PT(1) | 229,800 | 65,158 |
10
Shares | Value | |||||||
Tower Bersama Infrastructure Tbk PT | 478,900 | $ | 101,095 | |||||
266,025 | ||||||||
Malaysia — 3.0% | ||||||||
Carlsberg Brewery Malaysia Bhd | 12,300 | 58,017 | ||||||
Inari Amertron Bhd | 168,500 | 167,362 | ||||||
VS Industry Bhd | 250,200 | 85,568 | ||||||
310,947 | ||||||||
Mexico — 2.7% | ||||||||
Cemex SAB de CV, ADR(1) | 23,352 | 143,615 | ||||||
Gentera SAB de CV(1) | 259,686 | 132,492 | ||||||
276,107 | ||||||||
Peru — 1.1% | ||||||||
Intercorp Financial Services, Inc. | 4,039 | 117,131 | ||||||
Philippines — 3.4% | ||||||||
International Container Terminal Services, Inc. | 29,600 | 116,369 | ||||||
Wilcon Depot, Inc. | 370,200 | 234,114 | ||||||
350,483 | ||||||||
Russia — 5.7% | ||||||||
Detsky Mir PJSC | 64,543 | 120,593 | ||||||
HeadHunter Group plc, ADR | 2,943 | 161,718 | ||||||
TCS Group Holding plc, GDR | 3,236 | 308,637 | ||||||
590,948 | ||||||||
Saudi Arabia — 2.0% | ||||||||
Leejam Sports Co. JSC | 7,542 | 210,116 | ||||||
South Africa — 1.2% | ||||||||
Capitec Bank Holdings Ltd. | 630 | 72,292 | ||||||
Clicks Group Ltd. | 2,904 | 51,680 | ||||||
123,972 | ||||||||
South Korea — 16.7% | ||||||||
BNK Financial Group, Inc. | 29,438 | 198,049 | ||||||
Chunbo Co. Ltd. | 345 | 100,588 | ||||||
CJ Logistics Corp.(1) | 688 | 71,779 | ||||||
Cosmax, Inc.(1) | 723 | 54,980 | ||||||
Doosan Bobcat, Inc.(1) | 3,691 | 112,360 | ||||||
Ecopro BM Co. Ltd. | 928 | 424,245 | ||||||
GS Retail Co. Ltd. | 1,882 | 44,661 | ||||||
Han Kuk Carbon Co. Ltd. | 4,582 | 35,986 | ||||||
Iljin Materials Co. Ltd. | 2,955 | 318,511 | ||||||
Koh Young Technology, Inc. | 3,343 | 55,295 | ||||||
LG Innotek Co. Ltd. | 907 | 231,502 | ||||||
Mando Corp.(1) | 1,174 | 53,970 | ||||||
PI Advanced Materials Co. Ltd. | 986 | 38,310 | ||||||
1,740,236 | ||||||||
Taiwan — 18.6% | ||||||||
Accton Technology Corp. | 8,000 | 83,095 | ||||||
Airtac International Group | 2,000 | 61,209 | ||||||
Alchip Technologies Ltd. | 2,000 | 73,469 | ||||||
ASPEED Technology, Inc. | 2,000 | 241,201 | ||||||
Chailease Holding Co. Ltd. | 36,452 | 322,491 | ||||||
Gourmet Master Co. Ltd. | 22,000 | 93,467 | ||||||
ITEQ Corp. | 14,000 | 63,661 | ||||||
Merida Industry Co. Ltd. | 7,000 | 75,174 |
11
Shares | Value | |||||||
Nien Made Enterprise Co. Ltd. | 4,000 | $ | 54,490 | |||||
Powertech Technology, Inc. | 32,000 | 113,700 | ||||||
Realtek Semiconductor Corp. | 12,000 | 238,069 | ||||||
Sercomm Corp. | 22,000 | 51,904 | ||||||
Simplo Technology Co. Ltd. | 4,000 | 47,106 | ||||||
Taiwan Union Technology Corp. | 15,000 | 54,584 | ||||||
Vanguard International Semiconductor Corp. | 36,000 | 200,564 | ||||||
Wafer Works Corp. | 55,000 | 161,826 | ||||||
1,936,010 | ||||||||
Thailand — 2.3% | ||||||||
Minor International PCL(1) | 161,500 | 130,324 | ||||||
Muangthai Capital PCL | 25,900 | 42,945 | ||||||
Srisawad Corp. PCL | 35,560 | 63,149 | ||||||
236,418 | ||||||||
Turkey — 0.4% | ||||||||
Sok Marketler Ticaret AS | 44,768 | 46,620 | ||||||
TOTAL COMMON STOCKS (Cost $7,333,428) | 10,101,719 | |||||||
EXCHANGE-TRADED FUNDS — 2.3% | ||||||||
Fubon Taiwan Small-Mid Cap Alpha Momentum 50 ETF (Cost $251,189) | 165,000 | 242,136 | ||||||
WARRANT — 0.1% | ||||||||
Malaysia — 0.1% | ||||||||
VS Industry Bhd(1) (Cost $—) | 50,040 | 5,406 | ||||||
RIGHTS† | ||||||||
China† | ||||||||
CIFI Holdings Group Co. Ltd.(1) (Cost $—) | 4,428 | 142 | ||||||
TEMPORARY CASH INVESTMENTS — 0.6% | ||||||||
Repurchase Agreement, BMO Capital Markets Corp., (collateralized by various U.S. Treasury obligations, 0.125% - 2.625%, 6/30/22 - 5/15/51, valued at $70,056), in a joint trading account at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $68,587) | 68,587 | |||||||
State Street Institutional U.S. Government Money Market Fund, Premier Class | 1,063 | 1,063 | ||||||
TOTAL TEMPORARY CASH INVESTMENTS (Cost $69,650) | 69,650 | |||||||
TOTAL INVESTMENT SECURITIES — 100.2% (Cost $7,654,267) | 10,419,053 | |||||||
OTHER ASSETS AND LIABILITIES — (0.2)% | (24,877) | |||||||
TOTAL NET ASSETS — 100.0% | $ | 10,394,176 |
12
MARKET SECTOR DIVERSIFICATION | |||||
(as a % of net assets) | |||||
Information Technology | 25.9% | ||||
Consumer Discretionary | 22.4% | ||||
Financials | 18.1% | ||||
Industrials | 15.6% | ||||
Materials | 5.4% | ||||
Consumer Staples | 4.1% | ||||
Real Estate | 2.4% | ||||
Energy | 1.9% | ||||
Communication Services | 1.0% | ||||
Health Care | 0.5% | ||||
Exchange-Traded Funds | 2.3% | ||||
Temporary Cash Investments | 0.6% | ||||
Other Assets and Liabilities | (0.2)% |
NOTES TO SCHEDULE OF INVESTMENTS | ||||||||
ADR | - | American Depositary Receipt | ||||||
GDR | - | Global Depositary Receipt |
†Category is less than 0.05% of total net assets.
(1)Non-income producing.
(2)Security, or a portion thereof, is on loan. At the period end, the aggregate value of securities on loan was $117,717. The amount of securities on loan indicated may not correspond with the securities on loan identified because securities with pending sales are in the process of recall from the brokers. At the period end, the aggregate value of the collateral held by the fund was $123,993, all of which is securities collateral.
See Notes to Financial Statements.
13
Statement of Assets and Liabilities |
NOVEMBER 30, 2021 | |||||
Assets | |||||
Investment securities, at value (cost of $7,654,267) — including $117,717 of securities on loan | $ | 10,419,053 | |||
Foreign currency holdings, at value (cost of $219,766) | 219,766 | ||||
Receivable for investments sold | 75,323 | ||||
Receivable for capital shares sold | 2,199 | ||||
Dividends and interest receivable | 2,670 | ||||
Securities lending receivable | 90 | ||||
Other assets | 574 | ||||
10,719,675 | |||||
Liabilities | |||||
Payable for investments purchased | 105,662 | ||||
Payable for capital shares redeemed | 120,093 | ||||
Accrued management fees | 11,206 | ||||
Distribution and service fees payable | 303 | ||||
Accrued foreign taxes | 88,235 | ||||
325,499 | |||||
Net Assets | $ | 10,394,176 | |||
Net Assets Consist of: | |||||
Capital (par value and paid-in surplus) | $ | 6,990,621 | |||
Distributable earnings | 3,403,555 | ||||
$ | 10,394,176 |
Net Assets | Shares Outstanding | Net Asset Value Per Share | |||||||||
Investor Class, $0.01 Par Value | $3,450,626 | 209,397 | $16.48 | ||||||||
I Class, $0.01 Par Value | $6,090,255 | 367,531 | $16.57 | ||||||||
A Class, $0.01 Par Value | $304,503 | 18,608 | $16.36* | ||||||||
C Class, $0.01 Par Value | $9,956 | 626 | $15.90 | ||||||||
R Class, $0.01 Par Value | $520,632 | 32,076 | $16.23 | ||||||||
R6 Class, $0.01 Par Value | $18,204 | 1,094 | $16.64 |
*Maximum offering price $17.36 (net asset value divided by 0.9425).
See Notes to Financial Statements.
14
Statement of Operations |
YEAR ENDED NOVEMBER 30, 2021 | |||||
Investment Income (Loss) | |||||
Income: | |||||
Dividends (net of foreign taxes withheld of $18,590) | $ | 156,223 | |||
Securities lending, net | 434 | ||||
Interest | 25 | ||||
156,682 | |||||
Expenses: | |||||
Management fees | 121,987 | ||||
Distribution and service fees: | |||||
A Class | 641 | ||||
C Class | 99 | ||||
R Class | 2,069 | ||||
Directors' fees and expenses | 223 | ||||
Other expenses | 195 | ||||
125,214 | |||||
Net investment income (loss) | 31,468 | ||||
Realized and Unrealized Gain (Loss) | |||||
Net realized gain (loss) on: | |||||
Investment transactions (net of foreign tax expenses paid (refunded) of $21,260) | 816,955 | ||||
Foreign currency translation transactions | (9,407) | ||||
807,548 | |||||
Change in net unrealized appreciation (depreciation) on: | |||||
Investments (includes (increase) decrease in accrued foreign taxes of $(68,893)) | 744,696 | ||||
Translation of assets and liabilities in foreign currencies | 69 | ||||
744,765 | |||||
Net realized and unrealized gain (loss) | 1,552,313 | ||||
Net Increase (Decrease) in Net Assets Resulting from Operations | $ | 1,583,781 |
See Notes to Financial Statements.
15
Statement of Changes in Net Assets |
YEARS ENDED NOVEMBER 30, 2021 AND NOVEMBER 30, 2020 | ||||||||
Increase (Decrease) in Net Assets | November 30, 2021 | November 30, 2020 | ||||||
Operations | ||||||||
Net investment income (loss) | $ | 31,468 | $ | 31,274 | ||||
Net realized gain (loss) | 807,548 | 625,468 | ||||||
Change in net unrealized appreciation (depreciation) | 744,765 | 511,074 | ||||||
Net increase (decrease) in net assets resulting from operations | 1,583,781 | 1,167,816 | ||||||
Distributions to Shareholders | ||||||||
From earnings: | ||||||||
Investor Class | (125,868) | (18,004) | ||||||
I Class | (175,627) | (14,053) | ||||||
A Class | (8,853) | (971) | ||||||
C Class | (365) | — | ||||||
R Class | (11,882) | — | ||||||
R6 Class | (638) | (1,053) | ||||||
Decrease in net assets from distributions | (323,233) | (34,081) | ||||||
Capital Share Transactions | ||||||||
Net increase (decrease) in net assets from capital share transactions (Note 5) | 1,720,240 | (2,886,183) | ||||||
Net increase (decrease) in net assets | 2,980,788 | (1,752,448) | ||||||
Net Assets | ||||||||
Beginning of period | 7,413,388 | 9,165,836 | ||||||
End of period | $ | 10,394,176 | $ | 7,413,388 |
See Notes to Financial Statements.
16
Notes to Financial Statements |
NOVEMBER 30, 2021
1. Organization
American Century World Mutual Funds, Inc. (the corporation) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company and is organized as a Maryland corporation. Emerging Markets Small Cap Fund (the fund) is one fund in a series issued by the corporation. The fund’s investment objective is to seek capital growth.
The fund offers the Investor Class, I Class, A Class, C Class, R Class and R6 Class. The A Class may incur an initial sales charge. The A Class and C Class may be subject to a contingent deferred sales charge.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently followed by the fund in preparation of its financial statements. The fund is an investment company and follows accounting and reporting guidance in accordance with accounting principles generally accepted in the United States of America. This may require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from these estimates. Management evaluated the impact of events or transactions occurring through the date the financial statements were issued that would merit recognition or disclosure.
Investment Valuations — The fund determines the fair value of its investments and computes its net asset value (NAV) per share at the close of regular trading (usually 4 p.m. Eastern time) on the New York Stock Exchange (NYSE) on each day the NYSE is open. The Board of Directors has adopted valuation policies and procedures to guide the investment advisor in the fund’s investment valuation process and to provide methodologies for the oversight of the fund’s pricing function.
Equity securities that are listed or traded on a domestic securities exchange are valued at the last reported sales price or at the official closing price as provided by the exchange. Equity securities traded on foreign securities exchanges are generally valued at the closing price of such securities on the exchange where primarily traded or at the close of the NYSE, if that is earlier. If no last sales price is reported, or if local convention or regulation so provides, the mean of the latest bid and asked prices may be used. Securities traded over-the-counter are valued at the mean of the latest bid and asked prices, the last sales price, or the official closing price. Equity securities initially expressed in local currencies are translated into U.S. dollars at the mean of the appropriate currency exchange rate at the close of the NYSE as provided by an independent pricing service.
Open-end management investment companies are valued at the reported NAV per share. Repurchase agreements are valued at cost, which approximates fair value.
If the fund determines that the market price for an investment is not readily available or the valuation methods mentioned above do not reflect an investment’s fair value, such investment is valued as determined in good faith by the Board of Directors or its delegate, in accordance with policies and procedures adopted by the Board of Directors. In its determination of fair value, the fund may review several factors including, but not limited to, market information regarding the specific investment or comparable investments and correlation with other investment types, futures indices or general market indicators. Circumstances that may cause the fund to use these procedures to value an investment include, but are not limited to: an investment has been declared in default or is distressed; trading in a security has been suspended during the trading day or a security is not actively trading on its principal exchange; prices received from a regular pricing source are deemed unreliable; or there is a foreign market holiday and no trading occurred.
17
The fund monitors for significant events occurring after the close of an investment’s primary exchange but before the fund’s NAV per share is determined. Significant events may include, but are not limited to: corporate announcements and transactions; governmental action and political unrest that could impact a specific investment or an investment sector; or armed conflicts, natural disasters and similar events that could affect investments in a specific country or region. The fund also monitors for significant fluctuations between domestic and foreign markets, as evidenced by the U.S. market or such other indicators that the Board of Directors, or its delegate, deems appropriate. The fund may apply a model-derived factor to the closing price of equity securities traded on foreign securities exchanges. The factor is based on observable market data as provided by an independent pricing service.
Security Transactions — Security transactions are accounted for as of the trade date. Net realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes. Certain countries impose taxes on realized gains on the sale of securities registered in their country. The fund records the foreign tax expense, if any, on an accrual basis. The foreign tax expense on realized gains and unrealized appreciation reduces the net realized gain (loss) on investment transactions and net unrealized appreciation (depreciation) on investments, respectively.
Investment Income — Dividend income less foreign taxes withheld, if any, is recorded as of the ex-dividend date. Distributions received on securities that represent a return of capital or long-term capital gain are recorded as a reduction of cost of investments and/or as a realized gain. The fund may estimate the components of distributions received that may be considered nontaxable distributions or long-term capital gain distributions for income tax purposes. Interest income is recorded on the accrual basis and includes accretion of discounts and amortization of premiums. Securities lending income is net of fees and rebates earned by the lending agent for its services.
Foreign Currency Translations — All assets and liabilities initially expressed in foreign currencies are translated into U.S. dollars at prevailing exchange rates at period end. The fund may enter into spot foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of investment securities, dividend and interest income, spot foreign currency exchange contracts, and expenses are translated at the rates of exchange prevailing on the respective dates of such transactions. Net realized and unrealized foreign currency exchange gains or losses related to investment securities are a component of net realized gain (loss) on investment transactions and change in net unrealized appreciation (depreciation) on investments, respectively.
Repurchase Agreements — The fund may enter into repurchase agreements with institutions that American Century Investment Management, Inc. (ACIM) (the investment advisor) has determined are creditworthy pursuant to criteria adopted by the Board of Directors. The fund requires that the collateral, represented by securities, received in a repurchase transaction be transferred to the custodian in a manner sufficient to enable the fund to obtain those securities in the event of a default under the repurchase agreement. ACIM monitors, on a daily basis, the securities transferred to ensure the value, including accrued interest, of the securities under each repurchase agreement is equal to or greater than amounts owed to the fund under each repurchase agreement.
Joint Trading Account — Pursuant to an Exemptive Order issued by the Securities and Exchange Commission, the fund, along with certain other funds in the American Century Investments family of funds, may transfer uninvested cash balances into a joint trading account. These balances are invested in one or more repurchase agreements that are collateralized by U.S. Treasury or Agency obligations.
Segregated Assets — In accordance with the 1940 Act, the fund segregates assets on its books and records to cover certain types of investment securities and other financial instruments. ACIM monitors, on a daily basis, the securities segregated to ensure the fund designates a sufficient amount of liquid assets, marked-to-market daily. The fund may also receive assets or be required to pledge assets at the custodian bank or with a broker for collateral requirements.
Income Tax Status — It is the fund’s policy to distribute substantially all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code. Accordingly, no provision has been made for income taxes. The fund files U.S. federal, state, local and non-U.S. tax returns as applicable. The fund's tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years from the date of filing but can be longer in certain jurisdictions. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
18
Multiple Class — All shares of the fund represent an equal pro rata interest in the net assets of the class to which such shares belong, and have identical voting, dividend, liquidation and other rights and the same terms and conditions, except for class specific expenses and exclusive rights to vote on matters affecting only individual classes. Income, non-class specific expenses, and realized and unrealized capital gains and losses of the fund are allocated to each class of shares based on their relative net assets.
Distributions to Shareholders — Distributions from net investment income and net realized gains, if any, are generally declared and paid annually. The fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code, in all events in a manner consistent with provisions of the 1940 Act. The fund may elect to treat a portion of its payment to a redeeming shareholder, which represents the pro rata share of undistributed net investment income and net realized gains, as a distribution for federal income tax purposes (tax equalization).
Indemnifications — Under the corporation’s organizational documents, its officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business, the fund enters into contracts that provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against a fund. The risk of material loss from such claims is considered by management to be remote.
Securities Lending — Securities are lent to qualified financial institutions and brokers. State Street Bank & Trust Co. serves as securities lending agent to the fund pursuant to a Securities Lending Agreement. The lending of securities exposes the fund to risks such as: the borrowers may fail to return the loaned securities, the borrowers may not be able to provide additional collateral, the fund may experience delays in recovery of the loaned securities or delays in access to collateral, or the fund may experience losses related to the investment collateral. To minimize certain risks, loan counterparties pledge collateral in the form of cash and/or securities. The lending agent has agreed to indemnify the fund in the case of default of any securities borrowed. Cash collateral received is invested in the State Street Navigator Securities Lending Government Money Market Portfolio, a money market mutual fund registered under the 1940 Act. The loans may also be secured by U.S. government securities in an amount at least equal to the market value of the securities loaned, plus accrued interest and dividends, determined on a daily basis and adjusted accordingly. By lending securities, the fund seeks to increase its net investment income through the receipt of interest and fees. Such income is reflected separately within the Statement of Operations. The value of loaned securities and related collateral outstanding at period end, if any, are shown on a gross basis within the Schedule of Investments and Statement of Assets and Liabilities.
3. Fees and Transactions with Related Parties
Certain officers and directors of the corporation are also officers and/or directors of American Century Companies, Inc. (ACC). The corporation’s investment advisor, ACIM, the corporation's distributor, American Century Investment Services, Inc. (ACIS), and the corporation’s transfer agent, American Century Services, LLC, are wholly owned, directly or indirectly, by ACC.
Management Fees — The corporation has entered into a management agreement with ACIM, under which ACIM provides the fund with investment advisory and management services in exchange for a single, unified management fee (the fee) per class. The agreement provides that ACIM will pay all expenses of managing and operating the fund, except brokerage expenses, taxes, interest, fees and expenses of the independent directors (including legal counsel fees), extraordinary expenses, and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the 1940 Act. The fee is computed and accrued daily based on each class's daily net assets and paid monthly in arrears. The difference in the fee among the classes is a result of their separate arrangements for non-Rule 12b-1 shareholder services. It is not the result of any difference in advisory or custodial fees or other expenses related to the management of the fund’s assets, which do not vary by class.
The annual management fee for each class is as follows:
Investor Class | I Class | A Class | C Class | R Class | R6 Class | ||||||||||||
1.39% | 1.19% | 1.39% | 1.39% | 1.39% | 1.04% |
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Distribution and Service Fees — The Board of Directors has adopted a separate Master Distribution and Individual Shareholder Services Plan for each of the A Class, C Class and R Class (collectively the plans), pursuant to Rule 12b-1 of the 1940 Act. The plans provide that the A Class will pay ACIS an annual distribution and service fee of 0.25%. The plans provide that the C Class will pay ACIS an annual distribution and service fee of 1.00%, of which 0.25% is paid for individual shareholder services and 0.75% is paid for distribution services. The plans provide that the R Class will pay ACIS an annual distribution and service fee of 0.50%. The fees are computed and accrued daily based on each class’s daily net assets and paid monthly in arrears. The fees are used to pay financial intermediaries for distribution and individual shareholder services. Fees incurred under the plans during the period ended November 30, 2021 are detailed in the Statement of Operations.
Directors' Fees and Expenses — The Board of Directors is responsible for overseeing the investment advisor’s management and operations of the fund. The directors receive detailed information about the fund and its investment advisor regularly throughout the year, and meet at least quarterly with management of the investment advisor to review reports about fund operations. The fund’s officers do not receive compensation from the fund.
Interfund Transactions — The fund may enter into security transactions with other American Century Investments funds and other client accounts of the investment advisor, in accordance with the 1940 Act rules and procedures adopted by the Board of Directors. The rules and procedures require, among other things, that these transactions be effected at the independent current market price of the security. There were no interfund transactions during the period.
4. Investment Transactions
Purchases and sales of investment securities, excluding short-term investments, for the period ended November 30, 2021 were $6,172,832 and $4,872,434, respectively.
20
5. Capital Share Transactions
Transactions in shares of the fund were as follows:
Year ended November 30, 2021 | Year ended November 30, 2020 | |||||||||||||
Shares | Amount | Shares | Amount | |||||||||||
Investor Class/Shares Authorized | 40,000,000 | 40,000,000 | ||||||||||||
Sold | 54,500 | $ | 873,126 | 120,640 | $ | 1,518,746 | ||||||||
Issued in reinvestment of distributions | 8,815 | 125,349 | 1,277 | 16,531 | ||||||||||
Redeemed | (63,653) | (992,701) | (292,724) | (3,710,859) | ||||||||||
(338) | 5,774 | (170,807) | (2,175,582) | |||||||||||
I Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 125,816 | 2,006,203 | 146,395 | 1,806,093 | ||||||||||
Issued in reinvestment of distributions | 12,299 | 175,627 | 1,084 | 14,053 | ||||||||||
Redeemed | (46,058) | (742,943) | (61,929) | (811,084) | ||||||||||
92,057 | 1,438,887 | 85,550 | 1,009,062 | |||||||||||
A Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 3,415 | 57,000 | 2,814 | 32,167 | ||||||||||
Issued in reinvestment of distributions | 626 | 8,853 | 75 | 971 | ||||||||||
Redeemed | — | — | (56,705) | (766,988) | ||||||||||
4,041 | 65,853 | (53,816) | (733,850) | |||||||||||
C Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 235 | 3,788 | 747 | 10,204 | ||||||||||
Issued in reinvestment of distributions | 26 | 365 | — | — | ||||||||||
Redeemed | (235) | (3,812) | (55,780) | (740,656) | ||||||||||
26 | 341 | (55,033) | (730,452) | |||||||||||
R Class/Shares Authorized | 20,000,000 | 20,000,000 | ||||||||||||
Sold | 28,321 | 453,888 | 12,202 | 145,359 | ||||||||||
Issued in reinvestment of distributions | 845 | 11,882 | — | — | ||||||||||
Redeemed | (16,093) | (257,023) | (20,231) | (261,806) | ||||||||||
13,073 | 208,747 | (8,029) | (116,447) | |||||||||||
R6 Class/Shares Authorized | 20,000,000 | 20,000,000 | ||||||||||||
Issued in reinvestment of distributions | 44 | 638 | 81 | 1,053 | ||||||||||
Redeemed | — | — | (10,463) | (139,967) | ||||||||||
44 | 638 | (10,382) | (138,914) | |||||||||||
Net increase (decrease) | 108,903 | $ | 1,720,240 | (212,517) | $ | (2,886,183) |
6. Fair Value Measurements
The fund’s investments valuation process is based on several considerations and may use multiple inputs to determine the fair value of the investments held by the fund. In conformity with accounting principles generally accepted in the United States of America, the inputs used to determine a valuation are classified into three broad levels.
•Level 1 valuation inputs consist of unadjusted quoted prices in an active market for identical investments.
•Level 2 valuation inputs consist of direct or indirect observable market data (including quoted prices for comparable investments, evaluations of subsequent market events, interest rates, prepayment speeds, credit risk, etc.). These inputs also consist of quoted prices for identical investments initially expressed in local currencies that are adjusted through translation into U.S. dollars.
•Level 3 valuation inputs consist of unobservable data (including a fund’s own assumptions).
The level classification is based on the lowest level input that is significant to the fair valuation measurement. The valuation inputs are not necessarily an indication of the risks associated with investing in these securities or other financial instruments.
21
The following is a summary of the level classifications as of period end. The Schedule of Investments provides additional information on the fund’s portfolio holdings.
Level 1 | Level 2 | Level 3 | |||||||||
Assets | |||||||||||
Investment Securities | |||||||||||
Common Stocks | |||||||||||
Brazil | $ | 136,380 | $ | 410,517 | — | ||||||
India | 250,834 | 2,109,120 | — | ||||||||
Mexico | 143,615 | 132,492 | — | ||||||||
Peru | 117,131 | — | — | ||||||||
Russia | 161,718 | 429,230 | — | ||||||||
Other Countries | — | 6,210,682 | — | ||||||||
Exchange-Traded Funds | — | 242,136 | — | ||||||||
Warrants | — | 5,406 | — | ||||||||
Rights | — | 142 | — | ||||||||
Temporary Cash Investments | 1,063 | 68,587 | — | ||||||||
$ | 810,741 | $ | 9,608,312 | — |
7. Risk Factors
The value of the fund’s shares will go up and down, sometimes rapidly or unpredictably, based on the performance of the securities owned by the fund and other factors generally affecting the securities market. Market risks, including political, regulatory, economic and social developments, can affect the value of the fund’s investments. Natural disasters, public health emergencies, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse long-term effects on world economies and markets generally.
There are certain risks involved in investing in foreign securities. These risks include those resulting from political events (such as civil unrest, national elections and imposition of exchange controls), social and economic events (such as labor strikes and rising inflation), and natural disasters. Securities of foreign issuers may be less liquid and more volatile. Investing in emerging markets or a significant portion of assets in one country or region may accentuate these risks.
The fund invests in common stocks of small companies. Because of this, the fund may be subject to greater risk and market fluctuations than a fund investing in larger, more established companies.
8. Federal Tax Information
On December 21, 2021, the fund declared and paid a per-share distribution from net realized gains to
shareholders of record on December 20, 2021 of $1.2039 for the Investor Class, I Class, A Class, C
Class, R Class and R6 Class.
On December 21, 2021, the fund declared and paid the following per-share distributions from net investment income to shareholders of record on December 20, 2021:
Investor Class | I Class | A Class | C Class | R Class | R6 Class | ||||||||||||
$0.0152 | $0.0474 | — | — | — | $0.0715 |
22
The tax character of distributions paid during the years ended November 30, 2021 and November 30, 2020 were as follows:
2021 | 2020 | |||||||
Distributions Paid From | ||||||||
Ordinary income | — | $ | 20,197 | |||||
Long-term capital gains | $ | 323,233 | $ | 13,884 |
The book-basis character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements.
As of period end, the federal tax cost of investments and the components of distributable earnings on a tax-basis were as follows:
Federal tax cost of investments | $ | 7,689,997 | |||
Gross tax appreciation of investments | $ | 3,229,785 | |||
Gross tax depreciation of investments | (500,729) | ||||
Net tax appreciation (depreciation) of investments | 2,729,056 | ||||
Net tax appreciation (depreciation) on translation of assets and liabilities in foreign currencies | (88,558) | ||||
Net tax appreciation (depreciation) | $ | 2,640,498 | |||
Undistributed ordinary income | $ | 20,336 | |||
Accumulated long-term gains | $ | 742,721 |
The difference between book-basis and tax-basis unrealized appreciation (depreciation) is attributable primarily to the realization to ordinary income for tax purposes of unrealized gains on investments in passive foreign investment companies.
23
Financial Highlights |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Net Investment Income (Loss) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||
Investor Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $14.23 | 0.04 | 2.82 | 2.86 | — | (0.61) | (0.61) | $16.48 | 20.69% | 1.39% | 0.25% | 52% | $3,451 | ||||||||||||||||||||||||||||
2020 | $12.52 | 0.04 | 1.72 | 1.76 | (0.05) | — | (0.05) | $14.23 | 14.07% | 1.54% | 0.37% | 60% | $2,984 | ||||||||||||||||||||||||||||
2019 | $11.68 | 0.05 | 1.20 | 1.25 | — | (0.41) | (0.41) | $12.52 | 11.36% | 1.61% | 0.43% | 67% | $4,764 | ||||||||||||||||||||||||||||
2018 | $13.66 | 0.04 | (1.86) | (1.82) | (0.14) | (0.02) | (0.16) | $11.68 | (13.59)% | 1.60% | 0.31% | 75% | $5,924 | ||||||||||||||||||||||||||||
2017 | $10.45 | (0.03) | 3.33 | 3.30 | (0.09) | — | (0.09) | $13.66 | 31.85% | 1.61% | (0.16)% | 49% | $6,884 | ||||||||||||||||||||||||||||
I Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $14.27 | 0.07 | 2.84 | 2.91 | — | (0.61) | (0.61) | $16.57 | 21.06% | 1.19% | 0.45% | 52% | $6,090 | ||||||||||||||||||||||||||||
2020 | $12.56 | 0.07 | 1.71 | 1.78 | (0.07) | — | (0.07) | $14.27 | 14.25% | 1.34% | 0.57% | 60% | $3,932 | ||||||||||||||||||||||||||||
2019 | $11.69 | 0.07 | 1.21 | 1.28 | — | (0.41) | (0.41) | $12.56 | 11.52% | 1.41% | 0.63% | 67% | $2,386 | ||||||||||||||||||||||||||||
2018 | $13.68 | 0.06 | (1.86) | (1.80) | (0.17) | (0.02) | (0.19) | $11.69 | (13.39)% | 1.40% | 0.51% | 75% | $1,304 | ||||||||||||||||||||||||||||
2017 | $10.46 | 0.01 | 3.32 | 3.33 | (0.11) | — | (0.11) | $13.68 | 32.18% | 1.41% | 0.04% | 49% | $829 | ||||||||||||||||||||||||||||
A Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $14.17 | (0.01) | 2.81 | 2.80 | — | (0.61) | (0.61) | $16.36 | 20.41% | 1.64% | 0.00%(3) | 52% | $305 | ||||||||||||||||||||||||||||
2020 | $12.47 | 0.02 | 1.69 | 1.71 | (0.01) | — | (0.01) | $14.17 | 13.76% | 1.79% | 0.12% | 60% | $206 | ||||||||||||||||||||||||||||
2019 | $11.66 | 0.02 | 1.20 | 1.22 | — | (0.41) | (0.41) | $12.47 | 11.11% | 1.86% | 0.18% | 67% | $853 | ||||||||||||||||||||||||||||
2018 | $13.64 | 0.01 | (1.86) | (1.85) | (0.11) | (0.02) | (0.13) | $11.66 | (13.82)% | 1.85% | 0.06% | 75% | $1,209 | ||||||||||||||||||||||||||||
2017 | $10.43 | (0.04) | 3.31 | 3.27 | (0.06) | — | (0.06) | $13.64 | 31.57% | 1.86% | (0.41)% | 49% | $1,956 |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Net Investment Income (Loss) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||
C Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $13.88 | (0.12) | 2.75 | 2.63 | — | (0.61) | (0.61) | $15.90 | 19.58% | 2.39% | (0.75)% | 52% | $10 | ||||||||||||||||||||||||||||
2020 | $12.29 | (0.07) | 1.66 | 1.59 | — | — | — | $13.88 | 12.94% | 2.54% | (0.63)% | 60% | $8 | ||||||||||||||||||||||||||||
2019 | $11.58 | (0.07) | 1.19 | 1.12 | — | (0.41) | (0.41) | $12.29 | 10.20% | 2.61% | (0.57)% | 67% | $684 | ||||||||||||||||||||||||||||
2018 | $13.55 | (0.10) | (1.85) | (1.95) | —(4) | (0.02) | (0.02) | $11.58 | (14.41)% | 2.60% | (0.69)% | 75% | $1,160 | ||||||||||||||||||||||||||||
2017 | $10.38 | (0.13) | 3.30 | 3.17 | — | — | — | $13.55 | 30.54% | 2.61% | (1.16)% | 49% | $1,355 | ||||||||||||||||||||||||||||
R Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $14.09 | (0.04) | 2.79 | 2.75 | — | (0.61) | (0.61) | $16.23 | 20.16% | 1.89% | (0.25)% | 52% | $521 | ||||||||||||||||||||||||||||
2020 | $12.42 | (0.01) | 1.68 | 1.67 | — | — | — | $14.09 | 13.54% | 2.04% | (0.13)% | 60% | $268 | ||||||||||||||||||||||||||||
2019 | $11.64 | (0.01) | 1.20 | 1.19 | — | (0.41) | (0.41) | $12.42 | 10.68% | 2.11% | (0.07)% | 67% | $336 | ||||||||||||||||||||||||||||
2018 | $13.62 | (0.03) | (1.86) | (1.89) | (0.07) | (0.02) | (0.09) | $11.64 | (13.98)% | 2.10% | (0.19)% | 75% | $375 | ||||||||||||||||||||||||||||
2017 | $10.41 | (0.07) | 3.32 | 3.25 | (0.04) | — | (0.04) | $13.62 | 31.30% | 2.11% | (0.66)% | 49% | $331 | ||||||||||||||||||||||||||||
R6 Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $14.31 | 0.10 | 2.84 | 2.94 | — | (0.61) | (0.61) | $16.64 | 21.15% | 1.04% | 0.60% | 52% | $18 | ||||||||||||||||||||||||||||
2020 | $12.59 | 0.10 | 1.71 | 1.81 | (0.09) | — | (0.09) | $14.31 | 14.47% | 1.19% | 0.72% | 60% | $15 | ||||||||||||||||||||||||||||
2019 | $11.70 | 0.09 | 1.21 | 1.30 | — | (0.41) | (0.41) | $12.59 | 11.68% | 1.26% | 0.78% | 67% | $144 | ||||||||||||||||||||||||||||
2018 | $13.69 | 0.08 | (1.86) | (1.78) | (0.19) | (0.02) | (0.21) | $11.70 | (13.25)% | 1.25% | 0.66% | 75% | $240 | ||||||||||||||||||||||||||||
2017 | $10.47 | 0.03 | 3.31 | 3.34 | (0.12) | — | (0.12) | $13.69 | 32.35% | 1.26% | 0.19% | 49% | $277 |
Notes to Financial Highlights |
(1)Computed using average shares outstanding throughout the period.
(2)Total returns are calculated based on the net asset value of the last business day and do not reflect applicable sales charges, if any. Total returns for periods less than one year are not annualized.
(3)Ratio was less than 0.005%.
(4)Per-share amount was less than $0.005.
See Notes to Financial Statements.
Report of Independent Registered Public Accounting Firm |
To the Shareholders and the Board of Directors of American Century World Mutual Funds, Inc.:
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Emerging Markets Small Cap Fund (the “Fund”), one of the funds constituting the American Century World Mutual Funds, Inc., as of November 30, 2021, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of Emerging Markets Small Cap Fund of the American Century World Mutual Funds, Inc. as of November 30, 2021, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund’s financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. 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, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of November 30, 2021, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
/s/ Deloitte & Touche LLP
Kansas City, Missouri
January 19, 2022
We have served as the auditor of one or more American Century investment companies since 1997.
27
Management |
The Board of Directors
The individuals listed below serve as directors of the funds. Each director will continue to serve in this capacity until death, retirement, resignation or removal from office. The board has adopted a mandatory retirement age for directors who are not “interested persons,” as that term is defined in the Investment Company Act (independent directors). Independent directors shall retire by December 31 of the year in which they reach their 75th birthday.
Jonathan S. Thomas is an “interested person” because he currently serves as President and Chief Executive Officer of American Century Companies, Inc. (ACC), the parent company of American Century Investment Management, Inc. (ACIM or the advisor). The other directors (more than three-fourths of the total number) are independent. They are not employees, directors or officers of, and have no financial interest in, ACC or any of its wholly owned, direct or indirect, subsidiaries, including ACIM, American Century Investment Services, Inc. (ACIS) and American Century Services, LLC (ACS), and they do not have any other affiliations, positions or relationships that would cause them to be considered “interested persons” under the Investment Company Act. The directors serve in this capacity for seven (in the case of Jonathan S. Thomas, 16; and Stephen E. Yates, 8) registered investment companies in the American Century Investments family of funds.
The following table presents additional information about the directors. The mailing address for each director is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Thomas W. Bunn (1953) | Director | Since 2017 | Retired | 72 | SquareTwo Financial; Barings (formerly Babson Capital Funds Trust) (2013 to 2016) | ||||||||||||
Chris H. Cheesman (1962) | Director | Since 2019 | Retired. Senior Vice President & Chief Audit Executive, AllianceBernstein (1999 to 2018) | 72 | Alleghany Corporation | ||||||||||||
Barry Fink (1955) | Director | Since 2012 (independent since 2016) | Retired | 72 | None | ||||||||||||
Rajesh K. Gupta (1960) | Director | Since 2019 | Partner Emeritus, SeaCrest Investment Management and SeaCrest Wealth Management (2019 to Present); Chief Executive Officer and Chief Investment Officer, SeaCrest Investment Management (2006 to 2019); Chief Executive Officer and Chief Investment Officer, SeaCrest Wealth Management (2008 to 2019) | 72 | None |
28
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Lynn Jenkins (1963) | Director | Since 2019 | Consultant, LJ Strategies (2019 to present); United States Representative, U.S. House of Representatives (2009 to 2018) | 72 | MGP Ingredients, Inc. (2019 to 2021) | ||||||||||||
Jan M. Lewis (1957) | Director | Since 2011 | Retired | 72 | None | ||||||||||||
John R. Whitten(1) (1946) | Director | Since 2008 | Retired | 72 | Onto Innovation Inc. (2019 to 2020); Rudolph Technologies, Inc. (2006 to 2019) | ||||||||||||
Stephen E. Yates (1948) | Director and Chairman of the Board | Since 2012 (Chairman since 2018) | Retired | 108 | None | ||||||||||||
Interested Director | |||||||||||||||||
Jonathan S. Thomas (1963) | Director | Since 2007 | President and Chief Executive Officer, ACC (2007 to present). Also serves as Chief Executive Officer, ACS; Director, ACC and other ACC subsidiaries | 146 | None |
(1) Effective December 31, 2021, John R. Whitten retired from the Board of Directors.
The Statement of Additional Information has additional information about the fund's directors and is available without charge, upon request, by calling 1-800-345-2021.
29
Officers
The following table presents certain information about the executive officers of the funds. Each officer serves as an officer for each of the 16 (in the case of Robert J. Leach, 15) investment companies in the American Century family of funds. No officer is compensated for his or her service as an officer of the funds. The listed officers are interested persons of the funds and are appointed or re-appointed on an annual basis. The mailing address for each officer listed below is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Offices with the Funds | Principal Occupation(s) During the Past Five Years | ||||||
Patrick Bannigan (1965) | President since 2019 | Executive Vice President and Director, ACC (2012 to present); Chief Financial Officer, Chief Accounting Officer and Treasurer, ACC (2015 to present). Also serves as President, ACS; Vice President, ACIM; Chief Financial Officer, Chief Accounting Officer and/or Director, ACIM, ACS and other ACC subsidiaries | ||||||
R. Wes Campbell (1974) | Chief Financial Officer and Treasurer since 2018 | Vice President, ACS, (2020 to present); Investment Operations and Investment Accounting, ACS (2000 to present) | ||||||
Amy D. Shelton (1964) | Chief Compliance Officer and Vice President since 2014 | Chief Compliance Officer, American Century funds, (2014 to present); Chief Compliance Officer, ACIM (2014 to present); Chief Compliance Officer, ACIS (2009 to present). Also serves as Vice President, ACIS | ||||||
John Pak (1968) | General Counsel and Senior Vice President since 2021 | General Counsel and Senior Vice President, ACC (2021 to present). Also serves as General Counsel and Senior Vice President, ACIM, ACS and ACIS. Chief Legal Officer of Investment and Wealth Management, The Bank of New York Mellon (2014 to 2021) | ||||||
C. Jean Wade (1964) | Vice President since 2012 | Senior Vice President, ACS (2017 to present); Vice President, ACS (2000 to 2017) | ||||||
Robert J. Leach (1966) | Vice President since 2006 | Vice President, ACS (2000 to present) | ||||||
David H. Reinmiller (1963) | Vice President since 2000 | Attorney, ACC (1994 to present). Also serves as Vice President, ACIM and ACS | ||||||
Ward D. Stauffer (1960) | Secretary since 2005 | Attorney, ACC (2003 to present) |
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Approval of Management Agreement |
At a meeting held on June 30, 2021, the Fund’s Board of Directors (the "Board") unanimously approved the renewal of the management agreement pursuant to which American Century Investment Management, Inc. (the “Advisor”) acts as the investment advisor for the Fund. Under Section 15(c) of the Investment Company Act, contracts for investment advisory services are required to be reviewed, evaluated, and approved by a majority of a fund’s directors (the “Directors”), including a majority of the independent Directors, each year.
Prior to its consideration of the renewal of the management agreement, the Directors requested and reviewed extensive data and information compiled by the Advisor and certain independent providers of evaluation data concerning the Fund and the services provided to the Fund by the Advisor. This review was in addition to the oversight and evaluation undertaken by the Board and its committees on a continual basis and the information received was supplemental to the extensive information that the Board and its committees receive and consider throughout the year.
In connection with its consideration of the renewal of the management agreement, the Board’s review and evaluation of the services provided by the Advisor and its affiliates included, but was not limited to, the following:
•the nature, extent, and quality of investment management, shareholder services, and other services provided and to be provided to the Fund including without limitation portfolio management and trading services, shareholder and intermediary services, compliance and legal services, fund accounting and financial reporting, and fund share distribution;
•the wide range of other programs and services provided and to be provided to the Fund and its shareholders on a routine and non-routine basis;
•the Fund’s investment performance, including data comparing the Fund's performance to appropriate benchmarks and/or a peer group of other mutual funds with similar investment objectives and strategies;
•the cost of owning the Fund compared to the cost of owning similar funds;
•the compliance policies, procedures, and regulatory experience of the Advisor and the Fund's service providers;
•the Advisor’s strategic plans, COVID-19 pandemic response, vendor management practices, and social justice initiatives;
•the Advisor’s business continuity plans and cyber security practices;
•financial data showing the cost of services provided to the Fund, the profitability of the Fund to the Advisor, and the overall profitability of the Advisor;
•possible economies of scale associated with the Advisor’s management of the Fund and other accounts;
•services provided and charges to the Advisor's other investment management clients;
•acquired fund fees and expenses;
•payments and practices in connection with financial intermediaries holding shares of the Fund and the services provided by intermediaries in connection therewith; and
•possible collateral benefits to the Advisor from the management of the Fund.
The Board held two meetings to consider the renewal. The independent Directors also met in private session three times to review and discuss the information provided in response to their request. The independent Directors held active discussions with the Advisor regarding the renewal of the management agreement, requesting supplemental information, and reviewing information provided by the Advisor in response thereto. The independent Directors had the benefit of the advice of their independent counsel throughout the process.
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Factors Considered
The Directors considered all of the information provided by the Advisor, the independent data providers, and independent counsel in connection with the approval. They determined that the information was sufficient for them to evaluate the management agreement for the Fund. In connection with their review, the Directors did not identify any single factor as being all-important or controlling, and each Director may have attributed different levels of importance to different factors. In deciding to renew the management agreement, the Board based its decision on a number of factors, including without limitation the following:
Nature, Extent and Quality of Services — Generally. Under the management agreement, the Advisor is responsible for providing or arranging for all services necessary for the operation of the Fund. The Board noted that the Advisor provides or arranges at its own expense a wide variety of services which include the following:
•constructing and designing the Fund
•portfolio research and security selection
•initial capitalization/funding
•securities trading
•Fund administration
•custody of Fund assets
•daily valuation of the Fund’s portfolio
•liquidity monitoring and management
•risk management, including cyber security
•shareholder servicing and transfer agency, including shareholder confirmations, recordkeeping, and communications
•legal services (except the independent Directors’ counsel)
•regulatory and portfolio compliance
•financial reporting
•marketing and distribution (except amounts paid by the Fund under Rule 12b-1 plans)
The Board noted that many of these services have expanded over time in terms of both quantity and complexity in response to shareholder demands, competition in the industry, changing distribution channels, and the changing regulatory environment.
Investment Management Services. The nature of the investment management services provided to the Fund is quite complex and allows Fund shareholders access to professional money management, instant diversification of their investments within an asset class, the opportunity to easily diversify among asset classes by investing in or exchanging among various American Century Investments funds, and liquidity. In evaluating investment performance, the Board expects the Advisor to manage the Fund in accordance with its investment objectives and approved strategies. Further, the Directors recognize that the Advisor has an obligation to monitor trading activities, and in particular to seek the best execution of fund trades, and to evaluate the use of and payment for research. In providing these services, the Advisor utilizes teams of investment professionals (portfolio managers, analysts, research assistants, and securities traders) who require extensive information technology, research, training, compliance, and other systems to conduct their business. The Board, directly and through its Fund Performance Review Committee, provides oversight of the investment performance process. It regularly reviews investment performance information for the Fund, together with comparative information for appropriate benchmarks and/or peer groups of similarly-managed funds, over different time horizons. The Directors also review investment performance information during the management agreement renewal process. If performance concerns are identified, the Fund receives special reviews until performance improves, during which the Board discusses with the Advisor the reasons for such results (e.g., market conditions, security selection) and any efforts being undertaken to improve performance. The Fund’s performance was above its benchmark for the three-year period, and below its benchmark for the one-year period reviewed by the Board. The Board found the investment management services provided by the Advisor to the Fund to be satisfactory and consistent with the management agreement.
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Shareholder and Other Services. Under the management agreement, the Advisor provides the Fund with a comprehensive package of transfer agency, shareholder, and other services. The Board, directly and through its various committees, regularly reviews reports and evaluations of such services at its regular meetings. These reports include, but are not limited to, information regarding the operational efficiency and accuracy of the shareholder and transfer agency services provided, staffing levels, shareholder satisfaction, technology support (including cyber security), new products and services offered to Fund shareholders, securities trading activities, portfolio valuation services, auditing services, and legal and operational compliance activities. The Board found the services provided by the Advisor to the Fund under the management agreement to be competitive and of high quality.
Costs of Services and Profitability. The Advisor provides detailed information concerning its cost of providing various services to the Fund, its profitability in managing the Fund (pre- and post-distribution), its overall profitability, and its financial condition. The Directors have reviewed with the Advisor the methodology used to prepare this financial information. This information is considered in evaluating the Advisor’s financial condition, its ability to continue to provide services under the management agreement, and the reasonableness of the current management fee. The Board concluded that the Advisor’s profits were reasonable in light of the services provided to the Fund.
Ethics. The Board generally considers the Advisor’s commitment to providing quality services to shareholders and to conducting its business ethically. They noted that the Advisor’s practices generally meet or exceed industry best practices.
Economies of Scale. The Board also reviewed information provided by the Advisor regarding the possible existence of economies of scale in connection with the management of the Fund. The Board concluded that economies of scale are difficult to measure and predict with precision, especially on a fund-by-fund basis. The Board concluded that the Advisor is sharing economies of scale, to the extent they exist, through its competitive fee structure, offering competitive fees from fund inception, and through reinvestment in its business, infrastructure, investment capabilities and initiatives to provide shareholders additional content and services.
Comparison to Other Funds’ Fees. The management agreement provides that the Fund pays the Advisor a single, all-inclusive (or unified) management fee for providing all services necessary for the management and operation of the Fund, other than brokerage expenses, expenses attributable to short sales, taxes, interest, extraordinary expenses, fees and expenses of the Fund’s independent Directors (including their independent legal counsel), and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the Investment Company Act. Under the unified fee structure, the Advisor is responsible for providing all investment advisory, custody, audit, administrative, compliance, recordkeeping, marketing and shareholder services, or arranging and supervising third parties to provide such services. By contrast, most other funds are charged a variety of fees, including an investment advisory fee, a transfer agency fee, an administrative fee, distribution charges, and other expenses. Other than their investment advisory fees and any applicable Rule 12b-1 distribution fees, all other components of the total fees charged by these other funds may be increased without shareholder approval. The Board believes the unified fee structure is a benefit to Fund shareholders because it clearly discloses to shareholders the cost of owning Fund shares, and, since the unified fee cannot be increased without a vote of Fund shareholders, it shifts to the Advisor the risk of increased costs of operating the Fund and provides a direct incentive to minimize administrative inefficiencies. Part of the Board’s analysis of fee levels involves reviewing certain evaluative data compiled by an independent provider comparing the Fund’s unified fee to the total expense ratios of its peers. The unified fee charged to shareholders of the Fund was above the median of the total expense ratios of the Fund’s peer expense universe. In addition, the Board reviewed the Fund’s position relative to the narrower set of its expense group peers. The Board concluded that the management fee paid by the Fund to the Advisor under the management agreement is reasonable in light of the services provided to the Fund.
Comparison to Fees and Services Provided to Other Clients of the Advisor. The Board also requested and received information from the Advisor concerning the nature of the services, fees, costs, and profitability of its advisory services to advisory clients other than the Fund. They
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observed that these varying types of client accounts require different services and involve different regulatory and entrepreneurial risks than the management of the Fund. The Board analyzed this information and concluded that the fees charged and services provided to the Fund were reasonable by comparison.
Payments to Intermediaries. The Directors also requested and received a description of payments made to intermediaries by the Fund and the Advisor and services provided in response thereto. These payments include various payments made by the Fund or the Advisor to different types of intermediaries and recordkeepers for distribution and service activities provided for the Fund. The Directors reviewed such information and received representations from the Advisor that all such payments by the Fund were made pursuant to the Fund's Rule 12b-1 Plan and that all such payments by the Advisor were made from the Advisor’s resources and reasonable profits. The Board found such payments to be reasonable in scope and purpose.
Collateral or “Fall-Out” Benefits Derived by the Advisor. The Board considered the possible existence of collateral benefits the Advisor may receive as a result of its relationship with the Fund. They concluded that the Advisor’s primary business is managing funds and it generally does not use fund or shareholder information to generate profits in other lines of business, and therefore does not derive any significant collateral benefits from them. To the extent there are potential collateral benefits, the Board has been advised and has taken this into consideration in its review of the management contract with the Fund. The Board noted that additional assets from other clients may offer the Advisor some benefit from increased leverage with service providers and counterparties. Additionally, the Advisor may receive proprietary research from broker-dealers that execute fund portfolio transactions, which the Board concluded is likely to benefit other clients of the Advisor, as well as Fund shareholders. The Board also determined that the Advisor is able to provide investment management services to certain clients other than the Fund, at least in part, due to its existing infrastructure built to serve the fund complex. The Board concluded that appropriate allocation methodologies had been employed to assign resources and the cost of those resources to these other clients.
Existing Relationship. The Board also considered whether there was any reason for not continuing the existing arrangement with the Advisor. In this regard, the Board was mindful of the potential disruptions of the Fund’s operations and various risks, uncertainties, and other effects that could occur as a result of a decision not to continue such relationship. In particular, the Board recognized that most shareholders have invested in the Fund on the strength of the Advisor’s industry standing and reputation and in the expectation that the Advisor will have a continuing role in providing advisory services to the Fund.
Conclusion of the Directors. As a result of this process, the Board, including all of the independent Directors, taking into account all of the factors discussed above and the information provided by the Advisor and others in connection with its review and throughout the year, determined that the management fee is fair and reasonable in light of the services provided and that the investment management agreement between the Fund and the Advisor should be renewed.
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Additional Information |
Retirement Account Information
As required by law, distributions you receive from certain retirement accounts are subject to federal income tax withholding, unless you elect not to have withholding apply*. Tax will be withheld on the total amount withdrawn even though you may be receiving amounts that are not subject to withholding, such as nondeductible contributions. In such case, excess amounts of withholding could occur. You may adjust your withholding election so that a greater or lesser amount will be withheld.
If you don’t want us to withhold on this amount, you must notify us to not withhold the federal income tax. You may notify us in writing or in certain situations by telephone or through other electronic means. For systematic withdrawals, your withholding election will remain in effect until revoked or changed by filing a new election. You have the right to revoke your election at any time and change your withholding percentage for future distributions.
Remember, even if you elect not to have income tax withheld, you are liable for paying income tax on the taxable portion of your withdrawal. If you elect not to have income tax withheld or you don’t have enough income tax withheld, you may be responsible for payment of estimated tax. You may incur penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. You can reduce or defer the income tax on a distribution by directly or indirectly rolling such distribution over to another IRA or eligible plan. You should consult your tax advisor for additional information.
State tax will be withheld if, at the time of your distribution, your address is within one of the mandatory withholding states and you have federal income tax withheld (or as otherwise required by state law). State taxes will be withheld from your distribution in accordance with the respective state rules.
*Some 403(b), 457 and qualified retirement plan distributions may be subject to 20% mandatory withholding, as they are subject to special tax and withholding rules. Your plan administrator or plan sponsor is required to provide you with a special tax notice explaining those rules at the time you request a distribution. If applicable, federal and/or state taxes may be withheld from your distribution amount.
Proxy Voting Policies
A description of the policies that the fund's investment advisor uses in exercising the voting rights associated with the securities purchased and/or held by the fund is available without charge, upon request, by calling 1-800-345-2021. It is also available on American Century Investments’ website at americancentury.com/proxy and on the Securities and Exchange Commission’s website at sec.gov. Information regarding how the investment advisor voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on americancentury.com/proxy. It is also available at sec.gov.
Quarterly Portfolio Disclosure
The fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. These portfolio holdings are available on the fund's website at americancentury.com and, upon request, by calling 1-800-345-2021. The fund’s Form N-PORT reports are available on the SEC’s website at sec.gov.
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Other Tax Information
The following information is provided pursuant to provisions of the Internal Revenue Code.
The fund hereby designates up to the maximum amount allowable as qualified dividend income for
the fiscal year ended November 30, 2021.
The fund hereby designates $391,673, or up to the maximum amount allowable, as long-term
capital gain distributions (20% rate gain distributions) for the fiscal year ended November 30, 2021.
For the fiscal year ended November 30, 2021, the fund intends to pass through to shareholders
foreign source income of $174,813 and foreign taxes paid of $18,387, or up to the maximum
amount allowable, as a foreign tax credit. Foreign source income and foreign tax expense per
outstanding share on November 30, 2021 are $0.2778 and $0.0292, respectively.
The fund utilized earnings and profits of $72,023 distributed to shareholders on redemption of
shares as part of the dividends paid deduction (tax equalization).
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Contact Us | americancentury.com | |||||||
Automated Information Line | 1-800-345-8765 | |||||||
Investor Services Representative | 1-800-345-2021 or 816-531-5575 | |||||||
Investors Using Advisors | 1-800-378-9878 | |||||||
Business, Not-For-Profit, Employer-Sponsored Retirement Plans | 1-800-345-3533 | |||||||
Banks and Trust Companies, Broker-Dealers, Financial Professionals, Insurance Companies | 1-800-345-6488 | |||||||
Telecommunications Relay Service for the Deaf | 711 | |||||||
American Century World Mutual Funds, Inc. | ||||||||
Investment Advisor: American Century Investment Management, Inc. Kansas City, Missouri | ||||||||
This report and the statements it contains are submitted for the general information of our shareholders. The report is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. | ||||||||
©2022 American Century Proprietary Holdings, Inc. All rights reserved. CL-ANN-91033 2201 |
![image37.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image37.jpg)
Annual Report | |||||
November 30, 2021 | |||||
Focused Global Growth Fund | |||||
Investor Class (TWGGX) | |||||
I Class (AGGIX) | |||||
Y Class (AGYGX) | |||||
A Class (AGGRX) | |||||
C Class (AGLCX) | |||||
R Class (AGORX) | |||||
R5 Class (AGFGX) | |||||
R6 Class (AGGDX) |
Table of Contents |
President’s Letter | |||||
Performance | |||||
Portfolio Commentary | |||||
Fund Characteristics | |||||
Shareholder Fee Example | |||||
Schedule of Investments | |||||
Statement of Assets and Liabilities | |||||
Statement of Operations | |||||
Statement of Changes in Net Assets | |||||
Notes to Financial Statements | |||||
Financial Highlights | |||||
Report of Independent Registered Public Accounting Firm | |||||
Management | |||||
Approval of Management Agreement | |||||
Additional Information |
Any opinions expressed in this report reflect those of the author as of the date of the report, and do not necessarily represent the opinions of American Century Investments® or any other person in the American Century Investments organization. Any such opinions are subject to change at any time based upon market or other conditions and American Century Investments disclaims any responsibility to update such opinions. These opinions may not be relied upon as investment advice and, because investment decisions made by American Century Investments funds are based on numerous factors, may not be relied upon as an indication of trading intent on behalf of any American Century Investments fund. Security examples are used for representational purposes only and are not intended as recommendations to purchase or sell securities. Performance information for comparative indices and securities is provided to American Century Investments by third party vendors. To the best of American Century Investments’ knowledge, such information is accurate at the time of printing.
President’s Letter |
![image30a.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image30a.jpg)
Dear Investor:
Thank you for reviewing this annual report for the period ended November 30, 2021. Annual reports help convey important information about fund returns, including market factors that affected performance. For additional investment insights, please visit americancentury.com.
Global Stocks Advanced Despite Lingering and New Challenges
Global stocks broadly delivered solid gains for the 12-month period, even as pandemic-related challenges persisted. Improving economic data, along with central bank and government support and positive vaccine developments, helped boost corporate earnings and promote investor optimism. The U.S. generally outpaced other nations. Virus outbreaks and slower vaccine rollouts, particularly in emerging markets, led to lingering lockdowns in some regions.
As the period progressed, steady economic gains combined with ongoing monetary and fiscal support, rising energy prices and severe supply chain disruptions pushed global interest rates and inflation higher. In the U.S., year-over-year headline inflation climbed to 6.8% in November 2021, the largest 12-month increase in nearly 40 years. Similarly, inflation in the eurozone hit a 30-year high, while prices in the U.K. climbed to their highest level in 10 years.
Late in the period, the Federal Reserve began tapering its bond buying while adopting a more hawkish rate-tightening outlook amid surging inflation. However, central banks in Europe and the U.K. maintained their supportive programs, expressing concerns about slowing global growth outlooks. Meanwhile, the emergence of a new COVID-19 variant in late November triggered a steep sell-off among global stocks to end the reporting period.
Despite mounting inflation worries and late-period volatility, global stocks delivered solid performance for the full 12 months, highlighted by strong gains in developed markets. Emerging markets stocks generally delivered more modest returns.
Several Factors Shaping Market Dynamics
The return to pre-pandemic life is progressing, albeit somewhat cautiously due to COVID-19’s lingering effects. As the economy and markets respond to this fluid backdrop, investors will face opportunities and ongoing challenges. Economic growth, inflation, the virus’s trajectory, supply chain normalization and fiscal and monetary policy likely will sway market dynamics.
We appreciate your confidence in us during these extraordinary times. Our firm has a long history of helping clients weather unpredictable markets, and we’re confident we will continue to meet today’s challenges.
Sincerely,
![image23.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image23.jpg)
Jonathan Thomas
President and Chief Executive Officer
American Century Investments
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Performance |
Total Returns as of November 30, 2021 | ||||||||||||||||||||
Average Annual Returns | ||||||||||||||||||||
Ticker Symbol | 1 year | 5 years | 10 years | Since Inception | Inception Date | |||||||||||||||
Investor Class | TWGGX | 14.18% | 18.01% | 13.45% | — | 12/1/98 | ||||||||||||||
MSCI ACWI Index | — | 19.27% | 13.98% | 11.38% | — | — | ||||||||||||||
I Class | AGGIX | 14.45% | 18.25% | 13.69% | — | 8/1/00 | ||||||||||||||
Y Class | AGYGX | 14.62% | — | — | 17.59% | 4/10/17 | ||||||||||||||
A Class | AGGRX | 2/5/99 | ||||||||||||||||||
No sales charge | 13.99% | 17.73% | 13.18% | — | ||||||||||||||||
With sales charge | 7.44% | 16.34% | 12.51% | — | ||||||||||||||||
C Class | AGLCX | 12.99% | 16.84% | 12.32% | — | 3/1/02 | ||||||||||||||
R Class | AGORX | 13.71% | 17.43% | 12.90% | — | 7/29/05 | ||||||||||||||
R5 Class | AGFGX | 14.45% | — | — | 17.41% | 4/10/17 | ||||||||||||||
R6 Class | AGGDX | 14.57% | 18.42% | — | 12.98% | 7/26/13 |
Average annual returns since inception are presented when ten years of performance history is not available.
C Class shares will automatically convert to A Class shares after being held for approximately eight years. C Class average annual returns do not reflect this conversion.
Sales charges include initial sales charges and contingent deferred sales charges (CDSCs), as applicable. A Class shares have a 5.75% maximum initial sales charge and may be subject to a maximum CDSC of 1.00%. C Class shares redeemed within 12 months of purchase are subject to a maximum CDSC of 1.00%. The SEC requires that mutual funds provide performance information net of maximum sales charges in all cases where charges could be applied.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
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Growth of $10,000 Over 10 Years | ||
$10,000 investment made November 30, 2011 | ||
Performance for other share classes will vary due to differences in fee structure. |
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Value on November 30, 2021 | |||||
Investor Class — $35,363 | |||||
MSCI ACWI Index — $29,411 | |||||
Total Annual Fund Operating Expenses | |||||||||||||||||||||||
Investor Class | I Class | Y Class | A Class | C Class | R Class | R5 Class | R6 Class | ||||||||||||||||
1.07% | 0.87% | 0.72% | 1.32% | 2.07% | 1.57% | 0.87% | 0.72% |
The total annual fund operating expenses shown is as stated in the fund’s prospectus current as of the date of this report. The prospectus may vary from the expense ratio shown elsewhere in this report because it is based on a different time period, includes acquired fund fees and expenses, and, if applicable, does not include fee waivers or expense reimbursements.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
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Portfolio Commentary |
Portfolio Managers: Keith Creveling, Brent Puff and Ted Harlan
Performance Summary
Focused Global Growth returned 14.18%* for the fiscal year ended November 30, 2021, compared with the 19.27% return of its benchmark, the MSCI ACWI Index.
Weak stock selection within the financials and information technology sectors contributed to the fund’s underperformance, while investment selections within the energy and communication services sectors buoyed relative results. Geographically, relative performance was hindered by stock selection in Brazil, where the fund’s exposure was limited to stock exchange operator B3 - Brasil Bolsa Balcao (B3), which declined for the period. Investment selection in China also detracted. Conversely, relative performance was lifted by positive stock selection in Italy and France.
Select Financials Stocks Detracted From Relative Results
Notable individual detractors came from the financials sector, where Ping An Insurance Group Co. of China and B3 pressured results. Although Ping An Insurance, one of the largest financial services companies in the world, benefited from China’s early recovery from the pandemic, a combination of concerns around the company’s exposure to distressed China housing debt, uncertainty resulting from COVID-19 variants and regulatory risk weighed on the share price. We maintained our position in the stock as we believe that the risks on earnings are transitory and that our long-term thesis remains intact. Shares of B3 declined on concern that rising interest rates will negatively impact fixed income issuance and registration. We maintain our conviction in this stock, as we believe the financial markets in Brazil are in the early stages of maturation and that the long-term opportunity for B3 remains sound.
Medical products manufacturer Teleflex also detracted from the fund’s relative results. Procedural volumes continued to be negatively impacted by uncertainty around COVID-19 variants. Teleflex’s key growth driver is its UroLift System, a minimally invasive treatment for lower urinary tract symptoms resulting from benign prostatic hyperplasia. The long-term outlook for the procedures remains attractive, and we believe volumes will recover as COVID-19 risks subside.
The fund’s lack of exposure to software firm Microsoft also limited the fund’s relative gains. The stock rallied amid strong work-from-home trends and positive forecasting for cloud and personal computer usage. We do not own shares of Microsoft due to our assessment that it does not meet our investment criteria.
Energy Holdings Benefited From Economic Recovery
A recovering economy and higher crude oil prices buoyed the energy sector, where oil producer Pioneer Natural Resources and liquefied natural gas (LNG) company Cheniere Energy were standout performers. Our conviction in Pioneer strengthened during the period as a result of the company’s decision to divest some of its assets to generate significant cash and focus on the upstream aspects of its operations. Cheniere enjoyed stock gains amid rising demand and prices for LNG. Low industrywide supplies of LNG amid reopening economies ramped up demand. We believe Cheniere may see an acceleration in earnings growth as new liquefaction facilities increase production volumes and capacity.
Financial services company The Charles Schwab Corp. also buoyed the fund’s relative results. Contributing to share strength was Schwab’s acquisition of TD Ameritrade Holding and the
*All fund returns referenced in this commentary are for Investor Class shares. Performance for other share classes will vary due to differences in fee structure; when Investor Class performance exceeds that of the fund’s benchmark, other share classes may not. See page 3 for returns for all share classes.
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resulting cost synergies. Further supporting stock gains was solid annualized growth in net new money and average interest earnings assets. Our research suggests Schwab’s acquisition of TD Ameritrade could provide an additional growth catalyst, potentially resulting in further market share gains.
Another material contributor was home improvement retailer Lowe’s Cos., which enjoyed strong growth and profitability amid the pandemic-driven surge in home improvement projects. Of note was solid revenue growth in Lowe’s professional contractors’ segment, leading to optimism that it is gaining market share in this segment, which accounts for approximately 25% of the company’s total revenue. We maintain a positive outlook for Lowe’s, which recently raised its full-year outlook for 2021.
Portfolio Positioning
The fund continues to invest in companies where we believe business fundamentals are improving and where we have high conviction that improvement is sustainable. Though the outbreak of COVID-19 has been disruptive, major investment themes are structurally unchanged. For example, the fund remains balanced across economic reopening beneficiaries and secular growers. Our approach has led us to invest in companies where we believe fundamentals are in the early stages of inflecting higher, helped by economic normalization. We expect that top-line growth for many of these companies will reaccelerate and potentially revert to pre-COVID-19 levels. In certain cases, we believe earnings may benefit given that many of these companies also have improved their cost structures during the pandemic. We have selectively added to our exposure in certain businesses levered to travel, leisure activity and cyclical economic expansion.
The health crisis reinforced the sustainability of many secular trends, such as digitization, cloud computing, 5G network rollout and data center expansion. Other opportunities, such as the trend toward vehicle electrification and autonomous driving, continue to gain momentum and remain attractive to us, as do select companies exposed to improving physical infrastructure assets and the electric grid, which we believe will benefit from the recently approved U.S. investment plan.
At period-end, the fund maintained exposure to businesses in the financials sector (e.g., lenders and insurers) that we believe will be beneficiaries of higher interest rates. We have assessed the impact of higher rates on other areas, such as real estate investment trusts and housing, and remain confident that those companies will be able to offset inflationary headwinds via sustained revenue and earnings growth. The fund retains a neutral exposure to the leverage factor.
Notably, as the tailwind from COVID-19 fades, growth comparisons may become tougher for some businesses. We further expect marginal expenditure growth to be focused on experiential companies (e.g., restaurants and travel) after last year’s increased spending on home goods and technology.
6
Fund Characteristics |
NOVEMBER 30, 2021 | |||||
Types of Investments in Portfolio | % of net assets | ||||
Common Stocks | 99.8% | ||||
Temporary Cash Investments | 0.1% | ||||
Other Assets and Liabilities | 0.1% | ||||
Top Five Countries | % of net assets | ||||
United States | 63.0% | ||||
Ireland | 5.8% | ||||
France | 5.8% | ||||
Hong Kong | 5.2% | ||||
Switzerland | 2.8% |
7
Shareholder Fee Example |
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption/exchange fees; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in your fund and to compare these costs with the ongoing cost of investing in other mutual funds.
The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period from May 29, 2021 to November 30, 2021.
Actual Expenses
The table provides information about actual account values and actual expenses for each class. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. First, identify the share class you own. Then simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
If you hold Investor Class shares of any American Century Investments fund, or I Class shares of the American Century Diversified Bond Fund, in an American Century Investments account (i.e., not through a financial intermediary or employer-sponsored retirement plan account), American Century Investments may charge you a $25.00 annual account maintenance fee if the value of those shares is less than $10,000. We will redeem shares automatically in one of your accounts to pay the $25.00 fee. In determining your total eligible investment amount, we will include your investments in all personal accounts (including American Century Investments brokerage accounts) registered under your Social Security number. Personal accounts include individual accounts, joint accounts, UGMA/UTMA accounts, personal trusts, Coverdell Education Savings Accounts and IRAs (including traditional, Roth, Rollover, SEP-, SARSEP- and SIMPLE-IRAs), and certain other retirement accounts. If you have only business, business retirement, employer-sponsored or American Century Investments brokerage accounts, you are currently not subject to this fee. If you are subject to the account maintenance fee, your account value could be reduced by the fee amount.
Hypothetical Example for Comparison Purposes
The table also provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each class of your fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of a fund’s share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption/exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
8
Beginning Account Value 5/29/21 | Ending Account Value 11/30/21 | Expenses Paid During Period(1) 5/29/21 - 11/30/21 | Annualized Expense Ratio(1) | |||||||||||
Actual | ||||||||||||||
Investor Class | $1,000 | $992.70 | $5.48 | 1.08% | ||||||||||
I Class | $1,000 | $993.60 | $4.47 | 0.88% | ||||||||||
Y Class | $1,000 | $994.30 | $3.71 | 0.73% | ||||||||||
A Class | $1,000 | $991.70 | $6.75 | 1.33% | ||||||||||
C Class | $1,000 | $987.50 | $10.53 | 2.08% | ||||||||||
R Class | $1,000 | $990.70 | $8.01 | 1.58% | ||||||||||
R5 Class | $1,000 | $993.60 | $4.47 | 0.88% | ||||||||||
R6 Class | $1,000 | $994.30 | $3.71 | 0.73% | ||||||||||
Hypothetical | ||||||||||||||
Investor Class | $1,000 | $1,019.98 | $5.56 | 1.08% | ||||||||||
I Class | $1,000 | $1,021.00 | $4.53 | 0.88% | ||||||||||
Y Class | $1,000 | $1,021.76 | $3.76 | 0.73% | ||||||||||
A Class | $1,000 | $1,018.70 | $6.84 | 1.33% | ||||||||||
C Class | $1,000 | $1,014.88 | $10.68 | 2.08% | ||||||||||
R Class | $1,000 | $1,017.43 | $8.12 | 1.58% | ||||||||||
R5 Class | $1,000 | $1,021.00 | $4.53 | 0.88% | ||||||||||
R6 Class | $1,000 | $1,021.76 | $3.76 | 0.73% |
(1)Expenses are equal to the class's annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 186, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. Annualized expense ratio reflects actual expenses, including any applicable fee waivers or expense reimbursements and excluding any acquired fund fees and expenses.
9
Schedule of Investments |
NOVEMBER 30, 2021
Shares | Value | |||||||
COMMON STOCKS — 99.8% | ||||||||
Australia — 2.0% | ||||||||
CSL Ltd. | 69,440 | $ | 15,098,859 | |||||
Brazil — 1.7% | ||||||||
B3 SA - Brasil Bolsa Balcao | 6,533,600 | 12,935,060 | ||||||
China — 1.8% | ||||||||
Ping An Insurance Group Co. of China Ltd., H Shares | 1,998,000 | 13,850,619 | ||||||
France — 5.8% | ||||||||
Pernod Ricard SA | 92,260 | 21,169,931 | ||||||
Schneider Electric SE | 122,810 | 21,795,573 | ||||||
42,965,504 | ||||||||
Hong Kong — 5.2% | ||||||||
AIA Group Ltd. | 1,898,800 | 19,989,507 | ||||||
Hong Kong Exchanges & Clearing Ltd. | 348,583 | 19,169,074 | ||||||
39,158,581 | ||||||||
Hungary — 1.7% | ||||||||
OTP Bank Nyrt(1) | 224,353 | 12,387,924 | ||||||
India — 2.6% | ||||||||
HDFC Bank Ltd. | 973,500 | 19,285,843 | ||||||
Ireland — 5.8% | ||||||||
CRH plc | 456,710 | 22,202,799 | ||||||
ICON plc(1) | 78,800 | 21,313,036 | ||||||
43,515,835 | ||||||||
Italy — 2.6% | ||||||||
Stellantis NV | 1,116,954 | 19,127,004 | ||||||
Spain — 2.1% | ||||||||
Cellnex Telecom SA | 264,350 | 15,590,285 | ||||||
Switzerland — 2.8% | ||||||||
Zurich Insurance Group AG | 50,730 | 20,855,585 | ||||||
United Kingdom — 2.7% | ||||||||
AstraZeneca plc | 183,800 | 20,150,868 | ||||||
United States — 63.0% | ||||||||
Adobe, Inc.(1) | 34,357 | 23,014,036 | ||||||
Alphabet, Inc., Class A(1) | 14,620 | 41,490,829 | ||||||
Amazon.com, Inc.(1) | 11,868 | 41,621,907 | ||||||
American Express Co. | 125,890 | 19,173,047 | ||||||
AMETEK, Inc. | 156,880 | 21,414,120 | ||||||
Aptiv plc(1) | 131,120 | 21,025,092 | ||||||
Avantor, Inc.(1) | 552,180 | 21,800,066 | ||||||
Booking Holdings, Inc.(1) | 9,340 | 19,631,279 | ||||||
Charles Schwab Corp. (The) | 280,478 | 21,706,192 | ||||||
Cheniere Energy, Inc. | 201,510 | 21,120,263 | ||||||
Equinix, Inc. | 28,046 | 22,778,961 | ||||||
GXO Logistics, Inc.(1) | 108,910 | 10,460,806 | ||||||
HEICO Corp. | 155,620 | 21,556,482 | ||||||
L3Harris Technologies, Inc. | 57,360 | 11,992,829 | ||||||
Lowe's Cos., Inc. | 91,690 | 22,426,457 | ||||||
Mastercard, Inc., Class A | 67,500 | 21,257,100 |
10
Shares | Value | |||||||
NXP Semiconductors NV | 103,650 | $ | 23,151,264 | |||||
Pioneer Natural Resources Co. | 88,808 | 15,836,243 | ||||||
ServiceNow, Inc.(1) | 32,130 | 20,810,601 | ||||||
Teleflex, Inc. | 59,348 | 17,651,282 | ||||||
Texas Instruments, Inc. | 111,180 | 21,387,697 | ||||||
Visa, Inc., Class A | 42,892 | 8,311,183 | ||||||
469,617,736 | ||||||||
TOTAL COMMON STOCKS (Cost $521,049,218) | 744,539,703 | |||||||
TEMPORARY CASH INVESTMENTS — 0.1% | ||||||||
Repurchase Agreement, BMO Capital Markets Corp., (collateralized by various U.S. Treasury obligations, 0.125% - 2.625%, 6/30/22 - 5/15/51, valued at $147,730), in a joint trading account at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $144,632) | 144,632 | |||||||
Repurchase Agreement, Fixed Income Clearing Corp., (collateralized by various U.S. Treasury obligations, 1.00%, 7/31/28, valued at $489,627), at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $480,000) | 480,000 | |||||||
State Street Institutional U.S. Government Money Market Fund, Premier Class | 2,242 | 2,242 | ||||||
TOTAL TEMPORARY CASH INVESTMENTS (Cost $626,874) | 626,874 | |||||||
TOTAL INVESTMENT SECURITIES — 99.9% (Cost $521,676,092) | 745,166,577 | |||||||
OTHER ASSETS AND LIABILITIES — 0.1% | 476,226 | |||||||
TOTAL NET ASSETS — 100.0% | $ | 745,642,803 |
MARKET SECTOR DIVERSIFICATION | |||||
(as a % of net assets) | |||||
Financials | 21.3% | ||||
Consumer Discretionary | 16.6% | ||||
Information Technology | 15.8% | ||||
Health Care | 12.8% | ||||
Industrials | 11.7% | ||||
Communication Services | 7.7% | ||||
Energy | 4.9% | ||||
Real Estate | 3.1% | ||||
Materials | 3.0% | ||||
Consumer Staples | 2.9% | ||||
Temporary Cash Investments | 0.1% | ||||
Other Assets and Liabilities | 0.1% |
NOTES TO SCHEDULE OF INVESTMENTS |
(1)Non-income producing.
See Notes to Financial Statements.
11
Statement of Assets and Liabilities |
NOVEMBER 30, 2021 | |||||
Assets | |||||
Investment securities, at value (cost of $521,676,092) | $ | 745,166,577 | |||
Receivable for investments sold | 2,128,403 | ||||
Receivable for capital shares sold | 555,724 | ||||
Dividends and interest receivable | 1,124,701 | ||||
Other assets | 1,170 | ||||
748,976,575 | |||||
Liabilities | |||||
Payable for investments purchased | 1,496,904 | ||||
Payable for capital shares redeemed | 674,497 | ||||
Accrued management fees | 635,014 | ||||
Distribution and service fees payable | 15,718 | ||||
Accrued foreign taxes | 467,935 | ||||
Accrued other expenses | 43,704 | ||||
3,333,772 | |||||
Net Assets | $ | 745,642,803 | |||
Net Assets Consist of: | |||||
Capital (par value and paid-in surplus) | $ | 436,634,152 | |||
Distributable earnings | 309,008,651 | ||||
$ | 745,642,803 |
Net Assets | Shares Outstanding | Net Asset Value Per Share | |||||||||
Investor Class, $0.01 Par Value | $495,712,106 | 33,043,451 | $15.00 | ||||||||
I Class, $0.01 Par Value | $103,394,339 | 6,688,084 | $15.46 | ||||||||
Y Class, $0.01 Par Value | $311,069 | 19,918 | $15.62 | ||||||||
A Class, $0.01 Par Value | $34,058,965 | 2,387,460 | $14.27* | ||||||||
C Class, $0.01 Par Value | $5,426,493 | 489,587 | $11.08 | ||||||||
R Class, $0.01 Par Value | $8,410,977 | 610,080 | $13.79 | ||||||||
R5 Class, $0.01 Par Value | $10,541 | 682 | $15.46 | ||||||||
R6 Class, $0.01 Par Value | $98,318,313 | 6,305,498 | $15.59 |
*Maximum offering price $15.14 (net asset value divided by 0.9425).
See Notes to Financial Statements.
12
Statement of Operations |
YEAR ENDED NOVEMBER 30, 2021 | |||||
Investment Income (Loss) | |||||
Income: | |||||
Dividends (net of foreign taxes withheld of $406,288) | $ | 10,120,995 | |||
Interest | 3,998 | ||||
10,124,993 | |||||
Expenses: | |||||
Management fees | 7,511,065 | ||||
Distribution and service fees: | |||||
A Class | 86,012 | ||||
C Class | 58,337 | ||||
R Class | 45,186 | ||||
Directors' fees and expenses | 19,240 | ||||
Other expenses | 57,275 | ||||
7,777,115 | |||||
Net investment income (loss) | 2,347,878 | ||||
Realized and Unrealized Gain (Loss) | |||||
Net realized gain (loss) on: | |||||
Investment transactions (net of foreign tax expenses paid (refunded) of $85,421) | 94,560,285 | ||||
Foreign currency translation transactions | (158,075) | ||||
94,402,210 | |||||
Change in net unrealized appreciation (depreciation) on: | |||||
Investments (includes (increase) decrease in accrued foreign taxes of $132,579) | 2,235,117 | ||||
Translation of assets and liabilities in foreign currencies | (6,466) | ||||
2,228,651 | |||||
Net realized and unrealized gain (loss) | 96,630,861 | ||||
Net Increase (Decrease) in Net Assets Resulting from Operations | $ | 98,978,739 |
See Notes to Financial Statements.
13
Statement of Changes in Net Assets |
YEARS ENDED NOVEMBER 30, 2021 AND NOVEMBER 30, 2020 | ||||||||
Increase (Decrease) in Net Assets | November 30, 2021 | November 30, 2020 | ||||||
Operations | ||||||||
Net investment income (loss) | $ | 2,347,878 | $ | (674,587) | ||||
Net realized gain (loss) | 94,402,210 | 81,701,387 | ||||||
Change in net unrealized appreciation (depreciation) | 2,228,651 | 73,995,456 | ||||||
Net increase (decrease) in net assets resulting from operations | 98,978,739 | 155,022,256 | ||||||
Distributions to Shareholders | ||||||||
From earnings: | ||||||||
Investor Class | (45,815,568) | (70,603,884) | ||||||
I Class | (9,140,352) | (4,139,998) | ||||||
Y Class | (16,008) | (46,321) | ||||||
A Class | (3,095,249) | (4,387,898) | ||||||
C Class | (729,583) | (962,993) | ||||||
R Class | (964,647) | (1,212,750) | ||||||
R5 Class | (890) | (1,131) | ||||||
R6 Class | (8,866,888) | (6,775,967) | ||||||
Decrease in net assets from distributions | (68,629,185) | (88,130,942) | ||||||
Capital Share Transactions | ||||||||
Net increase (decrease) in net assets from capital share transactions (Note 5) | 22,244,775 | 42,008,322 | ||||||
Net increase (decrease) in net assets | 52,594,329 | 108,899,636 | ||||||
Net Assets | ||||||||
Beginning of period | 693,048,474 | 584,148,838 | ||||||
End of period | $ | 745,642,803 | $ | 693,048,474 |
See Notes to Financial Statements.
14
Notes to Financial Statements |
NOVEMBER 30, 2021
1. Organization
American Century World Mutual Funds, Inc. (the corporation) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company and is organized as a Maryland corporation. Focused Global Growth Fund (the fund) is one fund in a series issued by the corporation. The fund's investment objective is to seek capital growth.
The fund offers the Investor Class, I Class, Y Class, A Class, C Class, R Class, R5 Class and R6 Class. The A Class may incur an initial sales charge. The A Class and C Class may be subject to a contingent deferred sales charge.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently followed by the fund in preparation of its financial statements. The fund is an investment company and follows accounting and reporting guidance in accordance with accounting principles generally accepted in the United States of America. This may require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from these estimates. Management evaluated the impact of events or transactions occurring through the date the financial statements were issued that would merit recognition or disclosure.
Investment Valuations — The fund determines the fair value of its investments and computes its net asset value (NAV) per share at the close of regular trading (usually 4 p.m. Eastern time) on the New York Stock Exchange (NYSE) on each day the NYSE is open. The Board of Directors has adopted valuation policies and procedures to guide the investment advisor in the fund’s investment valuation process and to provide methodologies for the oversight of the fund’s pricing function.
Equity securities that are listed or traded on a domestic securities exchange are valued at the last reported sales price or at the official closing price as provided by the exchange. Equity securities traded on foreign securities exchanges are generally valued at the closing price of such securities on the exchange where primarily traded or at the close of the NYSE, if that is earlier. If no last sales price is reported, or if local convention or regulation so provides, the mean of the latest bid and asked prices may be used. Securities traded over-the-counter are valued at the mean of the latest bid and asked prices, the last sales price, or the official closing price. Equity securities initially expressed in local currencies are translated into U.S. dollars at the mean of the appropriate currency exchange rate at the close of the NYSE as provided by an independent pricing service.
Open-end management investment companies are valued at the reported NAV per share. Repurchase agreements are valued at cost, which approximates fair value.
If the fund determines that the market price for an investment is not readily available or the valuation methods mentioned above do not reflect an investment’s fair value, such investment is valued as determined in good faith by the Board of Directors or its delegate, in accordance with policies and procedures adopted by the Board of Directors. In its determination of fair value, the fund may review several factors including, but not limited to, market information regarding the specific investment or comparable investments and correlation with other investment types, futures indices or general market indicators. Circumstances that may cause the fund to use these procedures to value an investment include, but are not limited to: an investment has been declared in default or is distressed; trading in a security has been suspended during the trading day or a security is not actively trading on its principal exchange; prices received from a regular pricing source are deemed unreliable; or there is a foreign market holiday and no trading occurred.
The fund monitors for significant events occurring after the close of an investment’s primary exchange but before the fund’s NAV per share is determined. Significant events may include, but are not limited to: corporate announcements and transactions; governmental action and political unrest that could impact a specific investment or an investment sector; or armed conflicts, natural disasters and similar events that could affect investments in a specific country or region. The fund also monitors for significant fluctuations between domestic and foreign markets, as evidenced by the U.S. market or such other indicators that the Board of Directors, or its delegate, deems appropriate. The fund may apply a model-derived factor to the closing price
15
of equity securities traded on foreign securities exchanges. The factor is based on observable market data as provided by an independent pricing service.
Security Transactions — Security transactions are accounted for as of the trade date. Net realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes. Certain countries impose taxes on realized gains on the sale of securities registered in their country. The fund records the foreign tax expense, if any, on an accrual basis. The foreign tax expense on realized gains and unrealized appreciation reduces the net realized gain (loss) on investment transactions and net unrealized appreciation (depreciation) on investments, respectively.
Investment Income — Dividend income less foreign taxes withheld, if any, is recorded as of the ex-dividend date. Distributions received on securities that represent a return of capital or long-term capital gain are recorded as a reduction of cost of investments and/or as a realized gain. The fund may estimate the components of distributions received that may be considered nontaxable distributions or long-term capital gain distributions for income tax purposes. Interest income is recorded on the accrual basis and includes accretion of discounts and amortization of premiums.
Foreign Currency Translations — All assets and liabilities initially expressed in foreign currencies are translated into U.S. dollars at prevailing exchange rates at period end. The fund may enter into spot foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of investment securities, dividend and interest income, spot foreign currency exchange contracts, and expenses are translated at the rates of exchange prevailing on the respective dates of such transactions. Net realized and unrealized foreign currency exchange gains or losses related to investment securities are a component of net realized gain (loss) on investment transactions and change in net unrealized appreciation (depreciation) on investments, respectively.
Repurchase Agreements — The fund may enter into repurchase agreements with institutions that American Century Investment Management, Inc. (ACIM) (the investment advisor) has determined are creditworthy pursuant to criteria adopted by the Board of Directors. The fund requires that the collateral, represented by securities, received in a repurchase transaction be transferred to the custodian in a manner sufficient to enable the fund to obtain those securities in the event of a default under the repurchase agreement. ACIM monitors, on a daily basis, the securities transferred to ensure the value, including accrued interest, of the securities under each repurchase agreement is equal to or greater than amounts owed to the fund under each repurchase agreement.
Joint Trading Account — Pursuant to an Exemptive Order issued by the Securities and Exchange Commission, the fund, along with certain other funds in the American Century Investments family of funds, may transfer uninvested cash balances into a joint trading account. These balances are invested in one or more repurchase agreements that are collateralized by U.S. Treasury or Agency obligations.
Income Tax Status — It is the fund’s policy to distribute substantially all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code. Accordingly, no provision has been made for income taxes. The fund files U.S. federal, state, local and non-U.S. tax returns as applicable. The fund's tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years from the date of filing but can be longer in certain jurisdictions. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Multiple Class — All shares of the fund represent an equal pro rata interest in the net assets of the class to which such shares belong, and have identical voting, dividend, liquidation and other rights and the same terms and conditions, except for class specific expenses and exclusive rights to vote on matters affecting only individual classes. Income, non-class specific expenses, and realized and unrealized capital gains and losses of the fund are allocated to each class of shares based on their relative net assets.
Distributions to Shareholders — Distributions from net investment income and net realized gains, if any, are generally declared and paid annually. The fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code, in all events in a manner consistent with provisions of the 1940 Act. The fund may elect to treat a portion of its payment to a redeeming shareholder, which represents the pro rata share of undistributed net investment income and net realized gains, as a distribution for federal income tax purposes (tax equalization).
16
Indemnifications �� Under the corporation’s organizational documents, its officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business, the fund enters into contracts that provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against a fund. The risk of material loss from such claims is considered by management to be remote.
3. Fees and Transactions with Related Parties
Certain officers and directors of the corporation are also officers and/or directors of American Century Companies, Inc. (ACC). The corporation’s investment advisor, ACIM, the corporation's distributor, American Century Investment Services, Inc. (ACIS), and the corporation’s transfer agent, American Century Services, LLC, are wholly owned, directly or indirectly, by ACC.
Management Fees — The corporation has entered into a management agreement with ACIM, under which ACIM provides the fund with investment advisory and management services in exchange for a single, unified management fee (the fee) per class. The agreement provides that ACIM will pay all expenses of managing and operating the fund, except brokerage expenses, taxes, interest, fees and expenses of the independent directors (including legal counsel fees), extraordinary expenses, and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the 1940 Act. The fee is computed and accrued daily based on each class's daily net assets and paid monthly in arrears. The difference in the fee among the classes is a result of their separate arrangements for non-Rule 12b-1 shareholder services. It is not the result of any difference in advisory or custodial fees or other expenses related to the management of the fund’s assets, which do not vary by class. The rate of the fee is determined by applying a fee rate calculation formula. This formula takes into account the fund’s assets as well as certain assets, if any, of other clients of the investment advisor outside the American Century Investments family of funds (such as subadvised funds and separate accounts) that use very similar investment teams and strategies (strategy assets).
The management fee schedule range and the effective annual management fee for each class for the period ended November 30, 2021 are as follows:
Management Fee Schedule Range | Effective Annual Management Fee | |||||||
Investor Class | 1.050% to 1.300% | 1.06% | ||||||
I Class | 0.850% to 1.100% | 0.86% | ||||||
Y Class | 0.700% to 0.950% | 0.71% | ||||||
A Class | 1.050% to 1.300% | 1.06% | ||||||
C Class | 1.050% to 1.300% | 1.06% | ||||||
R Class | 1.050% to 1.300% | 1.06% | ||||||
R5 Class | 0.850% to 1.100% | 0.86% | ||||||
R6 Class | 0.700% to 0.950% | 0.71% |
Distribution and Service Fees — The Board of Directors has adopted a separate Master Distribution and Individual Shareholder Services Plan for each of the A Class, C Class and R Class (collectively the plans), pursuant to Rule 12b-1 of the 1940 Act. The plans provide that the A Class will pay ACIS an annual distribution and service fee of 0.25%. The plans provide that the C Class will pay ACIS an annual distribution and service fee of 1.00%, of which 0.25% is paid for individual shareholder services and 0.75% is paid for distribution services. The plans provide that the R Class will pay ACIS an annual distribution and service fee of 0.50%. The fees are computed and accrued daily based on each class’s daily net assets and paid monthly in arrears. The fees are used to pay financial intermediaries for distribution and individual shareholder services. Fees incurred under the plans during the period ended November 30, 2021 are detailed in the Statement of Operations.
Directors' Fees and Expenses — The Board of Directors is responsible for overseeing the investment advisor’s management and operations of the fund. The directors receive detailed information about the fund and its investment advisor regularly throughout the year, and meet at least quarterly with management of the investment advisor to review reports about fund operations. The fund’s officers do not receive compensation from the fund.
Interfund Transactions — The fund may enter into security transactions with other American Century Investments funds and other client accounts of the investment advisor, in accordance with the 1940 Act rules and procedures adopted by the Board of Directors. The rules and procedures require, among other things,
17
that these transactions be effected at the independent current market price of the security. There were no interfund transactions during the period.
4. Investment Transactions
Purchases and sales of investment securities, excluding short-term investments, for the period ended November 30, 2021 were $296,179,365 and $338,020,118, respectively.
5. Capital Share Transactions
Transactions in shares of the fund were as follows:
Year ended November 30, 2021 | Year ended November 30, 2020 | |||||||||||||
Shares | Amount | Shares | Amount | |||||||||||
Investor Class/Shares Authorized | 450,000,000 | 450,000,000 | ||||||||||||
Sold | 1,945,842 | $ | 28,544,017 | 4,048,205 | $ | 48,125,859 | ||||||||
Issued in reinvestment of distributions | 3,325,188 | 44,324,787 | 5,805,629 | 68,462,968 | ||||||||||
Redeemed | (4,017,264) | (59,355,560) | (11,332,337) | (135,918,928) | ||||||||||
1,253,766 | 13,513,244 | (1,478,503) | (19,330,101) | |||||||||||
I Class/Shares Authorized | 40,000,000 | 40,000,000 | ||||||||||||
Sold | 1,052,526 | 15,912,069 | 6,520,526 | 78,283,780 | ||||||||||
Issued in reinvestment of distributions | 666,184 | 9,133,407 | 342,162 | 4,129,640 | ||||||||||
Redeemed | (1,385,607) | (21,102,181) | (2,548,314) | (32,311,440) | ||||||||||
333,103 | 3,943,295 | 4,314,374 | 50,101,980 | |||||||||||
Y Class/Shares Authorized | 20,000,000 | 20,000,000 | ||||||||||||
Sold | 10,282 | 163,455 | — | — | ||||||||||
Issued in reinvestment of distributions | 1,158 | 16,008 | 3,811 | 46,321 | ||||||||||
Redeemed | (2,611) | (38,508) | (14,182) | (179,832) | ||||||||||
8,829 | 140,955 | (10,371) | (133,511) | |||||||||||
A Class/Shares Authorized | 40,000,000 | 40,000,000 | ||||||||||||
Sold | 396,873 | 5,527,341 | 510,346 | 6,048,111 | ||||||||||
Issued in reinvestment of distributions | 238,150 | 3,026,909 | 375,963 | 4,257,021 | ||||||||||
Redeemed | (437,494) | (6,205,899) | (755,382) | (8,720,936) | ||||||||||
197,529 | 2,348,351 | 130,927 | 1,584,196 | |||||||||||
C Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 172,859 | 1,883,121 | 109,079 | 1,056,740 | ||||||||||
Issued in reinvestment of distributions | 72,540 | 721,044 | 95,662 | 879,003 | ||||||||||
Redeemed | (228,104) | (2,455,660) | (183,221) | (1,758,641) | ||||||||||
17,295 | 148,505 | 21,520 | 177,102 | |||||||||||
R Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 98,966 | 1,348,277 | 197,690 | 2,324,558 | ||||||||||
Issued in reinvestment of distributions | 78,345 | 964,421 | 109,728 | 1,210,541 | ||||||||||
Redeemed | (226,169) | (3,046,609) | (230,339) | (2,620,957) | ||||||||||
(48,858) | (733,911) | 77,079 | 914,142 | |||||||||||
R5 Class/Shares Authorized | 20,000,000 | 20,000,000 | ||||||||||||
Issued in reinvestment of distributions | 65 | 890 | 94 | 1,131 | ||||||||||
R6 Class/Shares Authorized | 65,000,000 | 65,000,000 | ||||||||||||
Sold | 1,837,852 | 27,779,007 | 3,891,598 | 44,325,196 | ||||||||||
Issued in reinvestment of distributions | 583,293 | 8,055,272 | 463,745 | 5,619,736 | ||||||||||
Redeemed | (2,133,776) | (32,950,833) | (3,069,071) | (41,251,549) | ||||||||||
287,369 | 2,883,446 | 1,286,272 | 8,693,383 | |||||||||||
Net increase (decrease) | 2,049,098 | $ | 22,244,775 | 4,341,392 | $ | 42,008,322 |
18
6. Fair Value Measurements
The fund’s investments valuation process is based on several considerations and may use multiple inputs to determine the fair value of the investments held by the fund. In conformity with accounting principles generally accepted in the United States of America, the inputs used to determine a valuation are classified into three broad levels.
•Level 1 valuation inputs consist of unadjusted quoted prices in an active market for identical investments.
•Level 2 valuation inputs consist of direct or indirect observable market data (including quoted prices for comparable investments, evaluations of subsequent market events, interest rates, prepayment speeds, credit risk, etc.). These inputs also consist of quoted prices for identical investments initially expressed in local currencies that are adjusted through translation into U.S. dollars.
•Level 3 valuation inputs consist of unobservable data (including a fund’s own assumptions).
The level classification is based on the lowest level input that is significant to the fair valuation measurement. The valuation inputs are not necessarily an indication of the risks associated with investing in these securities or other financial instruments.
The following is a summary of the level classifications as of period end. The Schedule of Investments provides additional information on the fund’s portfolio holdings.
Level 1 | Level 2 | Level 3 | |||||||||
Assets | |||||||||||
Investment Securities | |||||||||||
Common Stocks | |||||||||||
Australia | — | $ | 15,098,859 | — | |||||||
Brazil | — | 12,935,060 | — | ||||||||
China | — | 13,850,619 | — | ||||||||
France | — | 42,965,504 | — | ||||||||
Hong Kong | — | 39,158,581 | — | ||||||||
Hungary | — | 12,387,924 | — | ||||||||
India | — | 19,285,843 | — | ||||||||
Ireland | $ | 21,313,036 | 22,202,799 | — | |||||||
Italy | — | 19,127,004 | — | ||||||||
Spain | — | 15,590,285 | — | ||||||||
Switzerland | — | 20,855,585 | — | ||||||||
United Kingdom | — | 20,150,868 | — | ||||||||
Other Countries | 469,617,736 | — | — | ||||||||
Temporary Cash Investments | 2,242 | 624,632 | — | ||||||||
$ | 490,933,014 | $ | 254,233,563 | — |
7. Risk Factors
The value of the fund’s shares will go up and down, sometimes rapidly or unpredictably, based on the performance of the securities owned by the fund and other factors generally affecting the securities market. Market risks, including political, regulatory, economic and social developments, can affect the value of the fund’s investments. Natural disasters, public health emergencies, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse long-term effects on world economies and markets generally.
There are certain risks involved in investing in foreign securities. These risks include those resulting from political events (such as civil unrest, national elections and imposition of exchange controls), social and economic events (such as labor strikes and rising inflation), and natural disasters. Securities of foreign issuers may be less liquid and more volatile. Investing in emerging markets or a significant portion of assets in one country or region may accentuate these risks.
19
8. Federal Tax Information
On December 21, 2021, the fund declared and paid a per-share distribution from net realized gains to shareholders of record on December 20, 2021 of $1.7687 for the Investor Class, I Class, Y Class, A Class, C Class, R Class, R5 Class and R6 Class.
On December 21, 2021, the fund declared and paid the following per-share distributions from net investment income to shareholders of record on December 20, 2021:
Investor Class | I Class | Y Class | A Class | C Class | R Class | R5 Class | R6 Class | ||||||||||||||||
$0.0316 | $0.0614 | $0.0837 | — | — | — | $0.0614 | $0.0837 |
The tax character of distributions paid during the years ended November 30, 2021 and November 30, 2020 were as follows:
2021 | 2020 | |||||||
Distributions Paid From | ||||||||
Ordinary income | $ | 19,030,387 | $ | 310,524 | ||||
Long-term capital gains | $ | 49,598,798 | $ | 87,820,418 |
The book-basis character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements.
As of period end, the federal tax cost of investments and the components of distributable earnings on a tax-basis were as follows:
Federal tax cost of investments | $ | 524,894,424 | |||
Gross tax appreciation of investments | $ | 239,061,238 | |||
Gross tax depreciation of investments | (18,789,085) | ||||
Net tax appreciation (depreciation) of investments | 220,272,153 | ||||
Net tax appreciation (depreciation) on translation of assets and liabilities in foreign currencies | (457,730) | ||||
Net tax appreciation (depreciation) | $ | 219,814,423 | |||
Undistributed ordinary income | $ | 9,637,751 | |||
Accumulated long-term gains | $ | 79,556,477 |
The difference between book-basis and tax-basis unrealized appreciation (depreciation) is attributable primarily to the tax deferral of losses on wash sales.
20
Financial Highlights |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Net Investment Income (Loss) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||
Investor Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $14.56 | 0.04 | 1.84 | 1.88 | — | (1.44) | (1.44) | $15.00 | 14.18% | 1.07% | 0.26% | 40% | $495,712 | ||||||||||||||||||||||||||||
2020 | $13.54 | (0.02) | 3.16 | 3.14 | —(3) | (2.12) | (2.12) | $14.56 | 27.02% | 1.07% | (0.14)% | 73% | $462,781 | ||||||||||||||||||||||||||||
2019 | $12.32 | 0.01 | 2.33 | 2.34 | (0.01) | (1.11) | (1.12) | $13.54 | 21.82% | 1.07% | 0.07% | 68% | $450,413 | ||||||||||||||||||||||||||||
2018 | $13.67 | 0.04 | 0.11 | 0.15 | (0.03) | (1.47) | (1.50) | $12.32 | 1.27% | 1.07% | 0.29% | 42% | $408,562 | ||||||||||||||||||||||||||||
2017 | $10.84 | 0.02 | 2.98 | 3.00 | (0.04) | (0.13) | (0.17) | $13.67 | 27.99% | 1.08% | 0.14% | 54% | $437,822 | ||||||||||||||||||||||||||||
I Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $14.93 | 0.07 | 1.90 | 1.97 | — | (1.44) | (1.44) | $15.46 | 14.45% | 0.87% | 0.46% | 40% | $103,394 | ||||||||||||||||||||||||||||
2020 | $13.84 | —(3) | 3.24 | 3.24 | (0.03) | (2.12) | (2.15) | $14.93 | 27.21% | 0.87% | 0.06% | 73% | $94,888 | ||||||||||||||||||||||||||||
2019 | $12.57 | 0.03 | 2.39 | 2.42 | (0.04) | (1.11) | (1.15) | $13.84 | 22.04% | 0.87% | 0.27% | 68% | $28,238 | ||||||||||||||||||||||||||||
2018 | $13.91 | 0.06 | 0.12 | 0.18 | (0.05) | (1.47) | (1.52) | $12.57 | 1.52% | 0.87% | 0.49% | 42% | $16,210 | ||||||||||||||||||||||||||||
2017 | $11.01 | 0.05 | 3.02 | 3.07 | (0.04) | (0.13) | (0.17) | $13.91 | 28.25% | 0.88% | 0.34% | 54% | $32,498 | ||||||||||||||||||||||||||||
Y Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $15.05 | 0.08 | 1.93 | 2.01 | — | (1.44) | (1.44) | $15.62 | 14.62% | 0.72% | 0.61% | 40% | $311 | ||||||||||||||||||||||||||||
2020 | $13.93 | 0.03 | 3.26 | 3.29 | (0.05) | (2.12) | (2.17) | $15.05 | 27.48% | 0.72% | 0.21% | 73% | $167 | ||||||||||||||||||||||||||||
2019 | $12.65 | 0.01 | 2.43 | 2.44 | (0.05) | (1.11) | (1.16) | $13.93 | 22.18% | 0.72% | 0.42% | 68% | $299 | ||||||||||||||||||||||||||||
2018 | $13.98 | 0.08 | 0.12 | 0.20 | (0.06) | (1.47) | (1.53) | $12.65 | 1.62% | 0.72% | 0.64% | 42% | $7 | ||||||||||||||||||||||||||||
2017(4) | $11.95 | 0.04 | 1.99 | 2.03 | — | — | — | $13.98 | 16.99% | 0.73%(5) | 0.49%(5) | 54%(6) | $6 |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Net Investment Income (Loss) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||
A Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $13.94 | —(3) | 1.77 | 1.77 | — | (1.44) | (1.44) | $14.27 | 13.99% | 1.32% | 0.01% | 40% | $34,059 | ||||||||||||||||||||||||||||
2020 | $13.08 | (0.05) | 3.03 | 2.98 | — | (2.12) | (2.12) | $13.94 | 26.66% | 1.32% | (0.39)% | 73% | $30,537 | ||||||||||||||||||||||||||||
2019 | $11.96 | (0.02) | 2.25 | 2.23 | — | (1.11) | (1.11) | $13.08 | 21.48% | 1.32% | (0.18)% | 68% | $26,932 | ||||||||||||||||||||||||||||
2018 | $13.31 | —(3) | 0.12 | 0.12 | — | (1.47) | (1.47) | $11.96 | 1.08% | 1.32% | 0.04% | 42% | $26,256 | ||||||||||||||||||||||||||||
2017 | $10.58 | (0.01) | 2.90 | 2.89 | (0.03) | (0.13) | (0.16) | $13.31 | 27.65% | 1.33% | (0.11)% | 54% | $30,622 | ||||||||||||||||||||||||||||
C Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $11.23 | (0.08) | 1.37 | 1.29 | — | (1.44) | (1.44) | $11.08 | 12.99% | 2.07% | (0.74)% | 40% | $5,426 | ||||||||||||||||||||||||||||
2020 | $11.00 | (0.11) | 2.46 | 2.35 | — | (2.12) | (2.12) | $11.23 | 25.84% | 2.07% | (1.14)% | 73% | $5,302 | ||||||||||||||||||||||||||||
2019 | $10.32 | (0.09) | 1.88 | 1.79 | — | (1.11) | (1.11) | $11.00 | 20.53% | 2.07% | (0.93)% | 68% | $4,960 | ||||||||||||||||||||||||||||
2018 | $11.77 | (0.08) | 0.10 | 0.02 | — | (1.47) | (1.47) | $10.32 | 0.27% | 2.07% | (0.71)% | 42% | $4,662 | ||||||||||||||||||||||||||||
2017 | $9.42 | (0.09) | 2.58 | 2.49 | (0.01) | (0.13) | (0.14) | $11.77 | 26.77% | 2.08% | (0.86)% | 54% | $5,977 | ||||||||||||||||||||||||||||
R Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $13.55 | (0.03) | 1.71 | 1.68 | — | (1.44) | (1.44) | $13.79 | 13.71% | 1.57% | (0.24)% | 40% | $8,411 | ||||||||||||||||||||||||||||
2020 | $12.80 | (0.07) | 2.94 | 2.87 | — | (2.12) | (2.12) | $13.55 | 26.34% | 1.57% | (0.64)% | 73% | $8,931 | ||||||||||||||||||||||||||||
2019 | $11.75 | (0.05) | 2.21 | 2.16 | — | (1.11) | (1.11) | $12.80 | 21.24% | 1.57% | (0.43)% | 68% | $7,448 | ||||||||||||||||||||||||||||
2018 | $13.14 | (0.03) | 0.11 | 0.08 | — | (1.47) | (1.47) | $11.75 | 0.75% | 1.57% | (0.21)% | 42% | $6,995 | ||||||||||||||||||||||||||||
2017 | $10.47 | (0.04) | 2.86 | 2.82 | (0.02) | (0.13) | (0.15) | $13.14 | 27.29% | 1.58% | (0.36)% | 54% | $7,925 |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Net Investment Income (Loss) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||
R5 Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $14.93 | 0.07 | 1.90 | 1.97 | — | (1.44) | (1.44) | $15.46 | 14.45% | 0.87% | 0.46% | 40% | $11 | ||||||||||||||||||||||||||||
2020 | $13.84 | 0.01 | 3.23 | 3.24 | (0.03) | (2.12) | (2.15) | $14.93 | 27.21% | 0.87% | 0.06% | 73% | $9 | ||||||||||||||||||||||||||||
2019 | $12.57 | 0.03 | 2.39 | 2.42 | (0.04) | (1.11) | (1.15) | $13.84 | 22.04% | 0.87% | 0.27% | 68% | $7 | ||||||||||||||||||||||||||||
2018 | $13.90 | 0.06 | 0.12 | 0.18 | (0.04) | (1.47) | (1.51) | $12.57 | 1.52% | 0.87% | 0.49% | 42% | $6 | ||||||||||||||||||||||||||||
2017(4) | $11.90 | 0.03 | 1.97 | 2.00 | — | — | — | $13.90 | 16.81% | 0.88%(5) | 0.34%(5) | 54%(6) | $6 | ||||||||||||||||||||||||||||
R6 Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $15.03 | 0.09 | 1.91 | 2.00 | — | (1.44) | (1.44) | $15.59 | 14.57% | 0.72% | 0.61% | 40% | $98,318 | ||||||||||||||||||||||||||||
2020 | $13.92 | 0.03 | 3.25 | 3.28 | (0.05) | (2.12) | (2.17) | $15.03 | 27.44% | 0.72% | 0.21% | 73% | $90,433 | ||||||||||||||||||||||||||||
2019 | $12.63 | 0.05 | 2.40 | 2.45 | (0.05) | (1.11) | (1.16) | $13.92 | 22.30% | 0.72% | 0.42% | 68% | $65,850 | ||||||||||||||||||||||||||||
2018 | $13.98 | 0.09 | 0.10 | 0.19 | (0.07) | (1.47) | (1.54) | $12.63 | 1.58% | 0.72% | 0.64% | 42% | $48,147 | ||||||||||||||||||||||||||||
2017 | $11.05 | 0.05 | 3.05 | 3.10 | (0.04) | (0.13) | (0.17) | $13.98 | 28.46% | 0.73% | 0.49% | 54% | $37,248 |
Notes to Financial Highlights |
(1)Computed using average shares outstanding throughout the period.
(2)Total returns are calculated based on the net asset value of the last business day and do not reflect applicable sales charges, if any. Total returns for periods less than one year are not annualized.
(3)Per-share amount was less than $0.005.
(4)April 10, 2017 (commencement of sale) through November 30, 2017.
(5)Annualized.
(6)Portfolio turnover is calculated at the fund level. Percentage indicated was calculated for the year ended November 30, 2017.
See Notes to Financial Statements.
Report of Independent Registered Public Accounting Firm |
To the Shareholders and the Board of Directors of American Century World Mutual Funds, Inc.:
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Focused Global Growth Fund (the “Fund”), one of the funds constituting the American Century World Mutual Funds, Inc., as of November 30, 2021, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of Focused Global Growth Fund of the American Century World Mutual Funds, Inc. as of November 30, 2021, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund’s financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. 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, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of November 30, 2021, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
/s/ Deloitte & Touche LLP
Kansas City, Missouri
January 19, 2022
We have served as the auditor of one or more American Century investment companies since 1997.
25
Management |
The Board of Directors
The individuals listed below serve as directors of the funds. Each director will continue to serve in this capacity until death, retirement, resignation or removal from office. The board has adopted a mandatory retirement age for directors who are not “interested persons,” as that term is defined in the Investment Company Act (independent directors). Independent directors shall retire by December 31 of the year in which they reach their 75th birthday.
Jonathan S. Thomas is an “interested person” because he currently serves as President and Chief Executive Officer of American Century Companies, Inc. (ACC), the parent company of American Century Investment Management, Inc. (ACIM or the advisor). The other directors (more than three-fourths of the total number) are independent. They are not employees, directors or officers of, and have no financial interest in, ACC or any of its wholly owned, direct or indirect, subsidiaries, including ACIM, American Century Investment Services, Inc. (ACIS) and American Century Services, LLC (ACS), and they do not have any other affiliations, positions or relationships that would cause them to be considered “interested persons” under the Investment Company Act. The directors serve in this capacity for seven (in the case of Jonathan S. Thomas, 16; and Stephen E. Yates, 8) registered investment companies in the American Century Investments family of funds.
The following table presents additional information about the directors. The mailing address for each director is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Thomas W. Bunn (1953) | Director | Since 2017 | Retired | 72 | SquareTwo Financial; Barings (formerly Babson Capital Funds Trust) (2013 to 2016) | ||||||||||||
Chris H. Cheesman (1962) | Director | Since 2019 | Retired. Senior Vice President & Chief Audit Executive, AllianceBernstein (1999 to 2018) | 72 | Alleghany Corporation | ||||||||||||
Barry Fink (1955) | Director | Since 2012 (independent since 2016) | Retired | 72 | None | ||||||||||||
Rajesh K. Gupta (1960) | Director | Since 2019 | Partner Emeritus, SeaCrest Investment Management and SeaCrest Wealth Management (2019 to Present); Chief Executive Officer and Chief Investment Officer, SeaCrest Investment Management (2006 to 2019); Chief Executive Officer and Chief Investment Officer, SeaCrest Wealth Management (2008 to 2019) | 72 | None |
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Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Lynn Jenkins (1963) | Director | Since 2019 | Consultant, LJ Strategies (2019 to present); United States Representative, U.S. House of Representatives (2009 to 2018) | 72 | MGP Ingredients, Inc. (2019 to 2021) | ||||||||||||
Jan M. Lewis (1957) | Director | Since 2011 | Retired | 72 | None | ||||||||||||
John R. Whitten(1) (1946) | Director | Since 2008 | Retired | 72 | Onto Innovation Inc. (2019 to 2020); Rudolph Technologies, Inc. (2006 to 2019) | ||||||||||||
Stephen E. Yates (1948) | Director and Chairman of the Board | Since 2012 (Chairman since 2018) | Retired | 108 | None | ||||||||||||
Interested Director | |||||||||||||||||
Jonathan S. Thomas (1963) | Director | Since 2007 | President and Chief Executive Officer, ACC (2007 to present). Also serves as Chief Executive Officer, ACS; Director, ACC and other ACC subsidiaries | 146 | None |
(1) Effective December 31, 2021, John R. Whitten retired from the Board of Directors.
The Statement of Additional Information has additional information about the fund's directors and is available without charge, upon request, by calling 1-800-345-2021.
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Officers
The following table presents certain information about the executive officers of the funds. Each officer serves as an officer for each of the 16 (in the case of Robert J. Leach, 15) investment companies in the American Century family of funds. No officer is compensated for his or her service as an officer of the funds. The listed officers are interested persons of the funds and are appointed or re-appointed on an annual basis. The mailing address for each officer listed below is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Offices with the Funds | Principal Occupation(s) During the Past Five Years | ||||||
Patrick Bannigan (1965) | President since 2019 | Executive Vice President and Director, ACC (2012 to present); Chief Financial Officer, Chief Accounting Officer and Treasurer, ACC (2015 to present). Also serves as President, ACS; Vice President, ACIM; Chief Financial Officer, Chief Accounting Officer and/or Director, ACIM, ACS and other ACC subsidiaries | ||||||
R. Wes Campbell (1974) | Chief Financial Officer and Treasurer since 2018 | Vice President, ACS, (2020 to present); Investment Operations and Investment Accounting, ACS (2000 to present) | ||||||
Amy D. Shelton (1964) | Chief Compliance Officer and Vice President since 2014 | Chief Compliance Officer, American Century funds, (2014 to present); Chief Compliance Officer, ACIM (2014 to present); Chief Compliance Officer, ACIS (2009 to present). Also serves as Vice President, ACIS | ||||||
John Pak (1968) | General Counsel and Senior Vice President since 2021 | General Counsel and Senior Vice President, ACC (2021 to present). Also serves as General Counsel and Senior Vice President, ACIM, ACS and ACIS. Chief Legal Officer of Investment and Wealth Management, The Bank of New York Mellon (2014 to 2021) | ||||||
C. Jean Wade (1964) | Vice President since 2012 | Senior Vice President, ACS (2017 to present); Vice President, ACS (2000 to 2017) | ||||||
Robert J. Leach (1966) | Vice President since 2006 | Vice President, ACS (2000 to present) | ||||||
David H. Reinmiller (1963) | Vice President since 2000 | Attorney, ACC (1994 to present). Also serves as Vice President, ACIM and ACS | ||||||
Ward D. Stauffer (1960) | Secretary since 2005 | Attorney, ACC (2003 to present) |
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Approval of Management Agreement |
At a meeting held on June 30, 2021, the Fund’s Board of Directors (the "Board") unanimously approved the renewal of the management agreement pursuant to which American Century Investment Management, Inc. (the “Advisor”) acts as the investment advisor for the Fund. Under Section 15(c) of the Investment Company Act, contracts for investment advisory services are required to be reviewed, evaluated, and approved by a majority of a fund’s directors (the “Directors”), including a majority of the independent Directors, each year.
Prior to its consideration of the renewal of the management agreement, the Directors requested and reviewed extensive data and information compiled by the Advisor and certain independent providers of evaluation data concerning the Fund and the services provided to the Fund by the Advisor. This review was in addition to the oversight and evaluation undertaken by the Board and its committees on a continual basis and the information received was supplemental to the extensive information that the Board and its committees receive and consider throughout the year.
In connection with its consideration of the renewal of the management agreement, the Board’s review and evaluation of the services provided by the Advisor and its affiliates included, but was not limited to, the following:
•the nature, extent, and quality of investment management, shareholder services, and other services provided and to be provided to the Fund including without limitation portfolio management and trading services, shareholder and intermediary services, compliance and legal services, fund accounting and financial reporting, and fund share distribution;
•the wide range of other programs and services provided and to be provided to the Fund and its shareholders on a routine and non-routine basis;
•the Fund’s investment performance, including data comparing the Fund's performance to appropriate benchmarks and/or a peer group of other mutual funds with similar investment objectives and strategies;
•the cost of owning the Fund compared to the cost of owning similar funds;
•the compliance policies, procedures, and regulatory experience of the Advisor and the Fund's service providers;
•the Advisor’s strategic plans, COVID-19 pandemic response, vendor management practices, and social justice initiatives;
•the Advisor’s business continuity plans and cyber security practices;
•financial data showing the cost of services provided to the Fund, the profitability of the Fund to the Advisor, and the overall profitability of the Advisor;
•possible economies of scale associated with the Advisor’s management of the Fund and other accounts;
•services provided and charges to the Advisor's other investment management clients;
•acquired fund fees and expenses;
•payments and practices in connection with financial intermediaries holding shares of the Fund and the services provided by intermediaries in connection therewith; and
•possible collateral benefits to the Advisor from the management of the Fund.
The Board held two meetings to consider the renewal. The independent Directors also met in private session three times to review and discuss the information provided in response to their request. The independent Directors held active discussions with the Advisor regarding the renewal of the management agreement, requesting supplemental information, and reviewing information provided by the Advisor in response thereto. The independent Directors had the benefit of the advice of their independent counsel throughout the process.
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Factors Considered
The Directors considered all of the information provided by the Advisor, the independent data providers, and independent counsel in connection with the approval. They determined that the information was sufficient for them to evaluate the management agreement for the Fund. In connection with their review, the Directors did not identify any single factor as being all-important or controlling, and each Director may have attributed different levels of importance to different factors. In deciding to renew the management agreement, the Board based its decision on a number of factors, including without limitation the following:
Nature, Extent and Quality of Services — Generally. Under the management agreement, the Advisor is responsible for providing or arranging for all services necessary for the operation of the Fund. The Board noted that the Advisor provides or arranges at its own expense a wide variety of services which include the following:
•constructing and designing the Fund
•portfolio research and security selection
•initial capitalization/funding
•securities trading
•Fund administration
•custody of Fund assets
•daily valuation of the Fund’s portfolio
•liquidity monitoring and management
•risk management, including cyber security
•shareholder servicing and transfer agency, including shareholder confirmations, recordkeeping, and communications
•legal services (except the independent Directors’ counsel)
•regulatory and portfolio compliance
•financial reporting
•marketing and distribution (except amounts paid by the Fund under Rule 12b-1 plans)
The Board noted that many of these services have expanded over time in terms of both quantity and complexity in response to shareholder demands, competition in the industry, changing distribution channels, and the changing regulatory environment.
Investment Management Services. The nature of the investment management services provided to the Fund is quite complex and allows Fund shareholders access to professional money management, instant diversification of their investments within an asset class, the opportunity to easily diversify among asset classes by investing in or exchanging among various American Century Investments funds, and liquidity. In evaluating investment performance, the Board expects the Advisor to manage the Fund in accordance with its investment objectives and approved strategies. Further, the Directors recognize that the Advisor has an obligation to monitor trading activities, and in particular to seek the best execution of fund trades, and to evaluate the use of and payment for research. In providing these services, the Advisor utilizes teams of investment professionals (portfolio managers, analysts, research assistants, and securities traders) who require extensive information technology, research, training, compliance, and other systems to conduct their business. The Board, directly and through its Fund Performance Review Committee, provides oversight of the investment performance process. It regularly reviews investment performance information for the Fund, together with comparative information for appropriate benchmarks and/or peer groups of similarly-managed funds, over different time horizons. The Directors also review investment performance information during the management agreement renewal process. If performance concerns are identified, the Fund receives special reviews until performance improves, during which the Board discusses with the Advisor the reasons for such results (e.g., market conditions, security selection) and any efforts being undertaken to improve performance. The Fund’s performance was above its benchmark for the one-, three-, five-, and ten-year periods reviewed by the Board. The Board found the investment management services provided by the Advisor to the Fund to be satisfactory and consistent with the management agreement.
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Shareholder and Other Services. Under the management agreement, the Advisor provides the Fund with a comprehensive package of transfer agency, shareholder, and other services. The Board, directly and through its various committees, regularly reviews reports and evaluations of such services at its regular meetings. These reports include, but are not limited to, information regarding the operational efficiency and accuracy of the shareholder and transfer agency services provided, staffing levels, shareholder satisfaction, technology support (including cyber security), new products and services offered to Fund shareholders, securities trading activities, portfolio valuation services, auditing services, and legal and operational compliance activities. The Board found the services provided by the Advisor to the Fund under the management agreement to be competitive and of high quality.
Costs of Services and Profitability. The Advisor provides detailed information concerning its cost of providing various services to the Fund, its profitability in managing the Fund (pre- and post-distribution), its overall profitability, and its financial condition. The Directors have reviewed with the Advisor the methodology used to prepare this financial information. This information is considered in evaluating the Advisor’s financial condition, its ability to continue to provide services under the management agreement, and the reasonableness of the current management fee. The Board concluded that the Advisor’s profits were reasonable in light of the services provided to the Fund.
Ethics. The Board generally considers the Advisor’s commitment to providing quality services to shareholders and to conducting its business ethically. They noted that the Advisor’s practices generally meet or exceed industry best practices.
Economies of Scale. The Board also reviewed information provided by the Advisor regarding the possible existence of economies of scale in connection with the management of the Fund. The Board concluded that economies of scale are difficult to measure and predict with precision, especially on a fund-by-fund basis. The Board concluded that the Advisor is sharing economies of scale, to the extent they exist, through its competitive fee structure, offering competitive fees from fund inception, and through reinvestment in its business, infrastructure, investment capabilities and initiatives to provide shareholders additional content and services. The Board also noted that economies of scale are shared with the Fund and its shareholders through management fee breakpoints that serve to reduce the effective management fee as the assets of the Fund grow.
Comparison to Other Funds’ Fees. The management agreement provides that the Fund pays the Advisor a single, all-inclusive (or unified) management fee for providing all services necessary for the management and operation of the Fund, other than brokerage expenses, expenses attributable to short sales, taxes, interest, extraordinary expenses, fees and expenses of the Fund’s independent Directors (including their independent legal counsel), and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the Investment Company Act. Under the unified fee structure, the Advisor is responsible for providing all investment advisory, custody, audit, administrative, compliance, recordkeeping, marketing and shareholder services, or arranging and supervising third parties to provide such services. By contrast, most other funds are charged a variety of fees, including an investment advisory fee, a transfer agency fee, an administrative fee, distribution charges, and other expenses. Other than their investment advisory fees and any applicable Rule 12b-1 distribution fees, all other components of the total fees charged by these other funds may be increased without shareholder approval. The Board believes the unified fee structure is a benefit to Fund shareholders because it clearly discloses to shareholders the cost of owning Fund shares, and, since the unified fee cannot be increased without a vote of Fund shareholders, it shifts to the Advisor the risk of increased costs of operating the Fund and provides a direct incentive to minimize administrative inefficiencies. Part of the Board’s analysis of fee levels involves reviewing certain evaluative data compiled by an independent provider comparing the Fund’s unified fee to the total expense ratios of its peers. The unified fee charged to shareholders of the Fund was below the median of the total expense ratios of the Fund’s peer expense universe. In addition, the Board reviewed the Fund’s position relative to the narrower set of its expense group peers. The Board concluded that the management fee paid by the Fund to the Advisor under the management agreement is reasonable in light of the services provided to the Fund.
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Comparison to Fees and Services Provided to Other Clients of the Advisor. The Board also requested and received information from the Advisor concerning the nature of the services, fees, costs, and profitability of its advisory services to advisory clients other than the Fund. They observed that these varying types of client accounts require different services and involve different regulatory and entrepreneurial risks than the management of the Fund. The Board analyzed this information and concluded that the fees charged and services provided to the Fund were reasonable by comparison.
Payments to Intermediaries. The Directors also requested and received a description of payments made to intermediaries by the Fund and the Advisor and services provided in response thereto. These payments include various payments made by the Fund or the Advisor to different types of intermediaries and recordkeepers for distribution and service activities provided for the Fund. The Directors reviewed such information and received representations from the Advisor that all such payments by the Fund were made pursuant to the Fund's Rule 12b-1 Plan and that all such payments by the Advisor were made from the Advisor’s resources and reasonable profits. The Board found such payments to be reasonable in scope and purpose.
Collateral or “Fall-Out” Benefits Derived by the Advisor. The Board considered the possible existence of collateral benefits the Advisor may receive as a result of its relationship with the Fund. They concluded that the Advisor’s primary business is managing funds and it generally does not use fund or shareholder information to generate profits in other lines of business, and therefore does not derive any significant collateral benefits from them. To the extent there are potential collateral benefits, the Board has been advised and has taken this into consideration in its review of the management contract with the Fund. The Board noted that additional assets from other clients may offer the Advisor some benefit from increased leverage with service providers and counterparties. Additionally, the Advisor may receive proprietary research from broker-dealers that execute fund portfolio transactions, which the Board concluded is likely to benefit other clients of the Advisor, as well as Fund shareholders. The Board also determined that the Advisor is able to provide investment management services to certain clients other than the Fund, at least in part, due to its existing infrastructure built to serve the fund complex. The Board concluded that appropriate allocation methodologies had been employed to assign resources and the cost of those resources to these other clients and, where expressly provided, these other client assets may be included with the assets of the Fund to determine breakpoints in the management fee schedule.
Existing Relationship. The Board also considered whether there was any reason for not continuing the existing arrangement with the Advisor. In this regard, the Board was mindful of the potential disruptions of the Fund’s operations and various risks, uncertainties, and other effects that could occur as a result of a decision not to continue such relationship. In particular, the Board recognized that most shareholders have invested in the Fund on the strength of the Advisor’s industry standing and reputation and in the expectation that the Advisor will have a continuing role in providing advisory services to the Fund.
Conclusion of the Directors. As a result of this process, the Board, including all of the independent Directors, taking into account all of the factors discussed above and the information provided by the Advisor and others in connection with its review and throughout the year, determined that the management fee is fair and reasonable in light of the services provided and that the investment management agreement between the Fund and the Advisor should be renewed.
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Additional Information |
Retirement Account Information
As required by law, distributions you receive from certain retirement accounts are subject to federal income tax withholding, unless you elect not to have withholding apply*. Tax will be withheld on the total amount withdrawn even though you may be receiving amounts that are not subject to withholding, such as nondeductible contributions. In such case, excess amounts of withholding could occur. You may adjust your withholding election so that a greater or lesser amount will be withheld.
If you don’t want us to withhold on this amount, you must notify us to not withhold the federal income tax. You may notify us in writing or in certain situations by telephone or through other electronic means. For systematic withdrawals, your withholding election will remain in effect until revoked or changed by filing a new election. You have the right to revoke your election at any time and change your withholding percentage for future distributions.
Remember, even if you elect not to have income tax withheld, you are liable for paying income tax on the taxable portion of your withdrawal. If you elect not to have income tax withheld or you don’t have enough income tax withheld, you may be responsible for payment of estimated tax. You may incur penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. You can reduce or defer the income tax on a distribution by directly or indirectly rolling such distribution over to another IRA or eligible plan. You should consult your tax advisor for additional information.
State tax will be withheld if, at the time of your distribution, your address is within one of the mandatory withholding states and you have federal income tax withheld (or as otherwise required by state law). State taxes will be withheld from your distribution in accordance with the respective state rules.
*Some 403(b), 457 and qualified retirement plan distributions may be subject to 20% mandatory withholding, as they are subject to special tax and withholding rules. Your plan administrator or plan sponsor is required to provide you with a special tax notice explaining those rules at the time you request a distribution. If applicable, federal and/or state taxes may be withheld from your distribution amount.
Proxy Voting Policies
A description of the policies that the fund's investment advisor uses in exercising the voting rights associated with the securities purchased and/or held by the fund is available without charge, upon request, by calling 1-800-345-2021. It is also available on American Century Investments’ website at americancentury.com/proxy and on the Securities and Exchange Commission’s website at sec.gov. Information regarding how the investment advisor voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on americancentury.com/proxy. It is also available at sec.gov.
Quarterly Portfolio Disclosure
The fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. These portfolio holdings are available on the fund's website at americancentury.com and, upon request, by calling 1-800-345-2021. The fund’s Form N-PORT reports are available on the SEC’s website at sec.gov.
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Other Tax Information
The following information is provided pursuant to provisions of the Internal Revenue Code.
The fund hereby designates up to the maximum amount allowable as qualified dividend income for the fiscal year ended November 30, 2021.
For corporate taxpayers, the fund hereby designates $2,468,557, or up to the maximum amount allowable, of ordinary income distributions paid during the fiscal year ended November 30, 2021 as qualified for the corporate dividends received deduction.
The fund hereby designates $55,057,689, or up to the maximum amount allowable, as long-term capital gain distributions (20% rate gain distributions) for the fiscal year ended November 30, 2021.
The fund hereby designates $19,556,842 as qualified short-term capital gain distributions for purposes of Internal Revenue Code Section 871 for the fiscal year ended November 30, 2021.
The fund utilized earnings and profits of $6,120,468 distributed to shareholders on redemption of shares as part of the dividends paid deduction (tax equalization).
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Notes |
35
Notes |
36
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Contact Us | americancentury.com | |||||||
Automated Information Line | 1-800-345-8765 | |||||||
Investor Services Representative | 1-800-345-2021 or 816-531-5575 | |||||||
Investors Using Advisors | 1-800-378-9878 | |||||||
Business, Not-For-Profit, Employer-Sponsored Retirement Plans | 1-800-345-3533 | |||||||
Banks and Trust Companies, Broker-Dealers, Financial Professionals, Insurance Companies | 1-800-345-6488 | |||||||
Telecommunications Relay Service for the Deaf | 711 | |||||||
American Century World Mutual Funds, Inc. | ||||||||
Investment Advisor: American Century Investment Management, Inc. Kansas City, Missouri | ||||||||
This report and the statements it contains are submitted for the general information of our shareholders. The report is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. | ||||||||
©2022 American Century Proprietary Holdings, Inc. All rights reserved. CL-ANN-91028 2201 |
![image37.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image37.jpg)
Annual Report | |||||
November 30, 2021 | |||||
Focused International Growth Fund | |||||
Investor Class (AFCNX) | |||||
I Class (AFCSX) | |||||
A Class (AFCLX) | |||||
C Class (AFCHX) | |||||
R Class (AFCWX) | |||||
R6 Class (AFCMX) | |||||
G Class (AFCGX) |
Table of Contents |
President’s Letter | |||||
Performance | |||||
Portfolio Commentary | |||||
Fund Characteristics | |||||
Shareholder Fee Example | |||||
Schedule of Investments | |||||
Statement of Assets and Liabilities | |||||
Statement of Operations | |||||
Statement of Changes in Net Assets | |||||
Notes to Financial Statements | |||||
Financial Highlights | |||||
Report of Independent Registered Public Accounting Firm | |||||
Management | |||||
Approval of Management Agreement | |||||
Additional Information |
Any opinions expressed in this report reflect those of the author as of the date of the report, and do not necessarily represent the opinions of American Century Investments® or any other person in the American Century Investments organization. Any such opinions are subject to change at any time based upon market or other conditions and American Century Investments disclaims any responsibility to update such opinions. These opinions may not be relied upon as investment advice and, because investment decisions made by American Century Investments funds are based on numerous factors, may not be relied upon as an indication of trading intent on behalf of any American Century Investments fund. Security examples are used for representational purposes only and are not intended as recommendations to purchase or sell securities. Performance information for comparative indices and securities is provided to American Century Investments by third party vendors. To the best of American Century Investments’ knowledge, such information is accurate at the time of printing.
President’s Letter |
![image30a.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image30a.jpg)
Dear Investor:
Thank you for reviewing this annual report for the period ended November 30, 2021. Annual reports help convey important information about fund returns, including market factors that affected performance. For additional investment insights, please visit americancentury.com.
Global Stocks Advanced Despite Lingering and New Challenges
Global stocks broadly delivered solid gains for the 12-month period, even as pandemic-related challenges persisted. Improving economic data, along with central bank and government support and positive vaccine developments, helped boost corporate earnings and promote investor optimism. The U.S. generally outpaced other nations. Virus outbreaks and slower vaccine rollouts, particularly in emerging markets, led to lingering lockdowns in some regions.
As the period progressed, steady economic gains combined with ongoing monetary and fiscal support, rising energy prices and severe supply chain disruptions pushed global interest rates and inflation higher. In the U.S., year-over-year headline inflation climbed to 6.8% in November 2021, the largest 12-month increase in nearly 40 years. Similarly, inflation in the eurozone hit a 30-year high, while prices in the U.K. climbed to their highest level in 10 years.
Late in the period, the Federal Reserve began tapering its bond buying while adopting a more hawkish rate-tightening outlook amid surging inflation. However, central banks in Europe and the U.K. maintained their supportive programs, expressing concerns about slowing global growth outlooks. Meanwhile, the emergence of a new COVID-19 variant in late November triggered a steep sell-off among global stocks to end the reporting period.
Despite mounting inflation worries and late-period volatility, global stocks delivered solid performance for the full 12 months, highlighted by strong gains in developed markets. Emerging markets stocks generally delivered more modest returns.
Several Factors Shaping Market Dynamics
The return to pre-pandemic life is progressing, albeit somewhat cautiously due to COVID-19’s lingering effects. As the economy and markets respond to this fluid backdrop, investors will face opportunities and ongoing challenges. Economic growth, inflation, the virus’s trajectory, supply chain normalization and fiscal and monetary policy likely will sway market dynamics.
We appreciate your confidence in us during these extraordinary times. Our firm has a long history of helping clients weather unpredictable markets, and we’re confident we will continue to meet today’s challenges.
Sincerely,
![image23.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image23.jpg)
Jonathan Thomas
President and Chief Executive Officer
American Century Investments
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Performance |
Total Returns as of November 30, 2021 | |||||||||||||||||||||||
Average Annual Returns | |||||||||||||||||||||||
Ticker Symbol | 1 year | 5 years | Since Inception | Inception Date | |||||||||||||||||||
Investor Class | AFCNX | 10.11% | 16.55% | 13.94% | 3/29/16 | ||||||||||||||||||
MSCI ACWI ex-U.S. Index | — | 9.14% | 9.27% | 8.89% | — | ||||||||||||||||||
I Class | AFCSX | 10.33% | 16.80% | 14.17% | 3/29/16 | ||||||||||||||||||
A Class | AFCLX | 3/29/16 | |||||||||||||||||||||
No sales charge | 9.85% | 16.27% | 13.66% | ||||||||||||||||||||
With sales charge | 3.55% | 14.91% | 12.48% | ||||||||||||||||||||
C Class | AFCHX | 9.04% | 15.42% | 12.82% | 3/29/16 | ||||||||||||||||||
R Class | AFCWX | 9.58% | 15.97% | 13.38% | 3/29/16 | ||||||||||||||||||
R6 Class | AFCMX | 10.51% | 16.97% | 14.34% | 3/29/16 | ||||||||||||||||||
G Class | AFCGX | 11.28% | — | 20.82% | 4/1/19 |
G Class returns would have been lower if a portion of the fees had not been waived.
Sales charges include initial sales charges and contingent deferred sales charges (CDSCs), as applicable. A Class shares have a 5.75% maximum initial sales charge and may be subject to a maximum CDSC of 1.00%. C Class shares redeemed within 12 months of purchase are subject to a maximum CDSC of 1.00%. The SEC requires that mutual funds provide performance information net of maximum sales charges in all cases where charges could be applied.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
3
Growth of $10,000 Over Life of Class | ||
$10,000 investment made March 29, 2016 | ||
Performance for other share classes will vary due to differences in fee structure. |
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Value on November 30, 2021 | |||||
Investor Class — $20,981 | |||||
MSCI ACWI ex-U.S. Index — $16,213 | |||||
Total Annual Fund Operating Expenses | ||||||||||||||||||||
Investor Class | I Class | A Class | C Class | R Class | R6 Class | G Class | ||||||||||||||
1.09% | 0.89% | 1.34% | 2.09% | 1.59% | 0.74% | 0.74% |
The total annual fund operating expenses shown is as stated in the fund’s prospectus current as of the date of this report. The prospectus may vary from the expense ratio shown elsewhere in this report because it is based on a different time period, includes acquired fund fees and expenses, and, if applicable, does not include fee waivers or expense reimbursements.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
4
Portfolio Commentary |
Portfolio Managers: Raj Gandhi and Jim Zhao
Performance Summary
Focused International Growth returned 10.11%* for the fiscal year ended November 30, 2021, outperforming its benchmark, the MSCI ACWI ex-U.S. Index, which returned 9.14%.
Portfolio holdings across a broad range of sectors, including health care, industrials and communication services, drove the fund’s excess returns, whereas stocks in the financials and energy sectors constrained performance. From a geographic perspective, underweight positioning in China proved beneficial.
The development of effective vaccines against COVID-19 late in 2020 raised hopes for a return to normalized economic activity and spurred strong gains among non-U.S. equities. As vaccine distribution ramped up in early 2021, markets favored stocks exposed to economic expansion. Names that had previously lagged, such as banks, oil producers and automobile manufacturers, rallied. However, as the recovery cycle matured, markets returned to rewarding individual companies demonstrating strong fundamentals and earnings improvement. Increased economic activity led to a strong corporate earnings recovery. In the second half of the year, the emergence of new coronavirus variants coupled with the pressures of supply chain disruptions, rising input costs and labor challenges led to increased market volatility. Although the rate of corporate earnings improvement slowed late in the period, expectations for continued earnings recovery remained upbeat supported by continued demand strength.
Earnings Surpassed Expectations, Fueled Strong Performance
Among health care holdings, pharmaceuticals company Novo Nordisk reported revenue and earnings that exceeded expectations driven by strong demand for its oral diabetes and weight loss drugs. Companies that provide outsourcing services for pharmaceuticals and biotechnology companies advanced notably. Strong earnings results and the acquisition of PRA Health Sciences lifted the stock of clinical research provider ICON. Contract manufacturer Lonza Group’s stock rose on continued strength in earnings and new contract wins supported by increased outsourcing by pharmaceutical and biotechnology companies.
A variety of industrials holdings advanced amid the global economic recovery, including human resources technology company Recruit Holdings. The firm, which owns Indeed and Glassdoor, benefited amid the return of job search activity to pre-pandemic levels and intensified competition to recruit talent. Stock of Ashtead Group, which leases construction equipment, rose sharply. Ashtead’s reported earnings significantly exceeded estimates as the firm benefited from the acceleration in U.S. nonresidential construction, especially public infrastructure, warehouses, data centers and multifamily housing. Stock of Techtronic Industries, the maker of Ryobi and Milwaukee power tools, rose on reported results that significantly exceeded analysts’ estimates as the firm continued to gain market share due to cordless tool product innovation and proprietary battery technology.
Other top individual contributors included information technology services company Capgemini and private equity firm Partners Group Holding. Strength in Capgemini’s digital transformation and cloud-related business drove ahead-of-expectations results and boosted the stock. Partners Group’s assets under management for the first half of 2021 exceeded expectations, which led analysts to raise earnings estimates for the full year. Asset growth and higher performance fees reflected strong demand for private assets, as investors sought higher returns during a period of low interest rates.
*All fund returns referenced in this commentary are for Investor Class shares. Performance for other share classes will vary due to differences in fee structure; when Investor Class performance exceeds that of the fund’s benchmark, other share classes may not. See page 3 for returns for all share classes.
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On the downside, financials detracted. Stock selection and an underweight in banks weighed on relative returns. Bank holdings in emerging markets, such as Bank Central Asia in Indonesia and India-based HDFC Bank, suffered particularly when surging COVID-19 cases and lagging vaccine distribution raised concerns about the potential impact on economic growth. Top individual detractors included Brazil-based retailer Magazine Luiza, which suffered amid economic turmoil in Brazil and increasing competition. We exited the position.
Portfolio Positioning
We remain committed to our disciplined, bottom-up process of identifying companies exhibiting accelerating, sustainable growth. Although the earnings growth that drove the market in the first half of 2021 subsequently stalled amid component and labor shortages, shipping delays and higher energy costs, we believe it should resume in the second half of 2022. In our view, bottlenecks in shipping and supply chains are transitory, and the most recent earnings season suggested that demand remains strong, and companies can pass through costs. We continue to maintain exposure to companies benefiting from strong secular trends, such as green energy and carbon reduction, including firms involved in wind generation, electric vehicle components and emissions testing. We also find opportunities related to shifts in global manufacturing with companies that specialize in factory automation design, components and software benefiting from increased capital investment in digital solutions for a variety of end markets.
As a result of our bottom-up stock selection process, we remain notably overweight to information technology and underweight to financials. Geographically, we retain a large exposure to European stocks. We continue to be underweight to Japan and Asia in general and have reduced our exposure to China.
6
Fund Characteristics |
NOVEMBER 30, 2021 | |||||
Types of Investments in Portfolio | % of net assets | ||||
Common Stocks | 96.5% | ||||
Temporary Cash Investments | 6.2% | ||||
Other Assets and Liabilities | (2.7)% | ||||
Top Five Countries | % of net assets | ||||
France | 19.7% | ||||
United Kingdom | 9.6% | ||||
Switzerland | 9.4% | ||||
Japan | 7.1% | ||||
Germany | 6.8% |
7
Shareholder Fee Example |
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption/exchange fees; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in your fund and to compare these costs with the ongoing cost of investing in other mutual funds.
The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period from May 29, 2021 to November 30, 2021.
Actual Expenses
The table provides information about actual account values and actual expenses for each class. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. First, identify the share class you own. Then simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
If you hold Investor Class shares of any American Century Investments fund, or I Class shares of the American Century Diversified Bond Fund, in an American Century Investments account (i.e., not through a financial intermediary or employer-sponsored retirement plan account), American Century Investments may charge you a $25.00 annual account maintenance fee if the value of those shares is less than $10,000. We will redeem shares automatically in one of your accounts to pay the $25.00 fee. In determining your total eligible investment amount, we will include your investments in all personal accounts (including American Century Investments brokerage accounts) registered under your Social Security number. Personal accounts include individual accounts, joint accounts, UGMA/UTMA accounts, personal trusts, Coverdell Education Savings Accounts and IRAs (including traditional, Roth, Rollover, SEP-, SARSEP- and SIMPLE-IRAs), and certain other retirement accounts. If you have only business, business retirement, employer-sponsored or American Century Investments brokerage accounts, you are currently not subject to this fee. If you are subject to the account maintenance fee, your account value could be reduced by the fee amount.
Hypothetical Example for Comparison Purposes
The table also provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each class of your fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of a fund’s share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption/exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
8
Beginning Account Value 5/29/21 | Ending Account Value 11/30/21 | Expenses Paid During Period(1) 5/29/21 - 11/30/21 | Annualized Expense Ratio(1) | |||||||||||
Actual | ||||||||||||||
Investor Class | $1,000 | $980.90 | $5.55 | 1.10% | ||||||||||
I Class | $1,000 | $982.00 | $4.55 | 0.90% | ||||||||||
A Class | $1,000 | $980.20 | $6.81 | 1.35% | ||||||||||
C Class | $1,000 | $976.60 | $10.58 | 2.10% | ||||||||||
R Class | $1,000 | $979.10 | $8.07 | 1.60% | ||||||||||
R6 Class | $1,000 | $983.10 | $3.79 | 0.75% | ||||||||||
G Class | $1,000 | $986.70 | $0.05 | 0.01% | ||||||||||
Hypothetical | ||||||||||||||
Investor Class | $1,000 | $1,019.87 | $5.66 | 1.10% | ||||||||||
I Class | $1,000 | $1,020.89 | $4.63 | 0.90% | ||||||||||
A Class | $1,000 | $1,018.60 | $6.94 | 1.35% | ||||||||||
C Class | $1,000 | $1,014.78 | $10.78 | 2.10% | ||||||||||
R Class | $1,000 | $1,017.33 | $8.22 | 1.60% | ||||||||||
R6 Class | $1,000 | $1,021.66 | $3.86 | 0.75% | ||||||||||
G Class | $1,000 | $1,025.43 | $0.05 | 0.01% |
(1)Expenses are equal to the class's annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 186, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. Annualized expense ratio reflects actual expenses, including any applicable fee waivers or expense reimbursements and excluding any acquired fund fees and expenses.
9
Schedule of Investments |
NOVEMBER 30, 2021
Shares | Value | |||||||
COMMON STOCKS — 96.5% | ||||||||
Australia — 3.7% | ||||||||
Atlassian Corp. plc, Class A(1) | 2,000 | $ | 752,640 | |||||
CSL Ltd. | 6,700 | 1,456,831 | ||||||
2,209,471 | ||||||||
Austria — 3.0% | ||||||||
Erste Group Bank AG | 41,630 | 1,823,940 | ||||||
Canada — 4.9% | ||||||||
Canadian Pacific Railway Ltd. | 14,260 | 997,960 | ||||||
GFL Environmental, Inc. | 24,799 | 957,242 | ||||||
Shopify, Inc., Class A(1) | 640 | 972,452 | ||||||
2,927,654 | ||||||||
China — 3.9% | ||||||||
Li Ning Co. Ltd. | 109,000 | 1,232,854 | ||||||
Wuxi Biologics Cayman, Inc.(1) | 82,500 | 1,112,907 | ||||||
2,345,761 | ||||||||
Denmark — 3.2% | ||||||||
Novo Nordisk A/S, B Shares | 18,120 | 1,939,745 | ||||||
France — 19.7% | ||||||||
Bureau Veritas SA | 51,380 | 1,627,221 | ||||||
Capgemini SE | 9,710 | 2,241,763 | ||||||
Dassault Systemes SE | 23,230 | 1,400,326 | ||||||
LVMH Moet Hennessy Louis Vuitton SE | 2,110 | 1,640,724 | ||||||
Pernod Ricard SA | 5,510 | 1,264,322 | ||||||
Schneider Electric SE | 12,100 | 2,147,435 | ||||||
Teleperformance | 2,380 | 978,972 | ||||||
Valeo | 17,560 | 506,164 | ||||||
11,806,927 | ||||||||
Germany — 6.8% | ||||||||
Daimler AG | 13,300 | 1,245,585 | ||||||
Infineon Technologies AG | 32,095 | 1,451,126 | ||||||
Puma SE | 11,580 | 1,399,110 | ||||||
4,095,821 | ||||||||
Hong Kong — 1.8% | ||||||||
Techtronic Industries Co. Ltd. | 52,500 | 1,079,752 | ||||||
India — 1.8% | ||||||||
HDFC Bank Ltd., ADR | 16,680 | 1,092,040 | ||||||
Indonesia — 1.5% | ||||||||
Bank Central Asia Tbk PT | 1,798,400 | 913,817 | ||||||
Ireland — 4.3% | ||||||||
ICON plc(1) | 5,920 | 1,601,182 | ||||||
Ryanair Holdings plc, ADR(1) | 10,160 | 970,788 | ||||||
2,571,970 | ||||||||
Japan — 7.1% | ||||||||
Food & Life Cos. Ltd. | 33,000 | 1,397,465 | ||||||
Keyence Corp. | 2,600 | 1,605,711 | ||||||
Recruit Holdings Co. Ltd. | 20,500 | 1,244,753 | ||||||
4,247,929 |
10
Shares | Value | |||||||
Netherlands — 5.9% | ||||||||
Adyen NV(1) | 719 | $ | 1,991,512 | |||||
Koninklijke DSM NV | 7,110 | 1,530,331 | ||||||
3,521,843 | ||||||||
Spain — 4.2% | ||||||||
Cellnex Telecom SA | 23,254 | 1,371,426 | ||||||
Iberdrola SA | 100,874 | 1,132,013 | ||||||
2,503,439 | ||||||||
Sweden — 2.3% | ||||||||
Hexagon AB, B Shares | 95,180 | 1,384,171 | ||||||
Switzerland — 9.4% | ||||||||
Lonza Group AG | 2,180 | 1,757,837 | ||||||
Partners Group Holding AG | 1,070 | 1,846,657 | ||||||
SIG Combibloc Group AG(1) | 35,590 | 938,156 | ||||||
Sika AG | 2,840 | 1,109,023 | ||||||
5,651,673 | ||||||||
Taiwan — 3.4% | ||||||||
Taiwan Semiconductor Manufacturing Co. Ltd. | 95,000 | 2,020,524 | ||||||
United Kingdom — 9.6% | ||||||||
Ashtead Group plc | 20,340 | 1,636,314 | ||||||
AstraZeneca plc | 14,630 | 1,603,957 | ||||||
HSBC Holdings plc | 286,400 | 1,586,449 | ||||||
Segro plc | 50,550 | 944,737 | ||||||
5,771,457 | ||||||||
TOTAL COMMON STOCKS (Cost $50,018,073) | 57,907,934 | |||||||
TEMPORARY CASH INVESTMENTS — 6.2% | ||||||||
Repurchase Agreement, BMO Capital Markets Corp., (collateralized by various U.S. Treasury obligations, 0.125% - 2.625%, 6/30/22 - 5/15/51, valued at $870,978), in a joint trading account at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $852,713) | 852,713 | |||||||
Repurchase Agreement, Fixed Income Clearing Corp., (collateralized by various U.S. Treasury obligations, 1.00%, 7/31/28, valued at $2,898,852), at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $2,842,002) | 2,842,000 | |||||||
State Street Institutional U.S. Government Money Market Fund, Premier Class | 13,218 | 13,218 | ||||||
TOTAL TEMPORARY CASH INVESTMENTS (Cost $3,707,931) | 3,707,931 | |||||||
TOTAL INVESTMENT SECURITIES — 102.7% (Cost $53,726,004) | 61,615,865 | |||||||
OTHER ASSETS AND LIABILITIES — (2.7)% | (1,591,896) | |||||||
TOTAL NET ASSETS — 100.0% | $ | 60,023,969 |
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MARKET SECTOR DIVERSIFICATION | |||||
(as a % of net assets) | |||||
Information Technology | 23.1% | ||||
Industrials | 19.4% | ||||
Health Care | 15.8% | ||||
Consumer Discretionary | 12.3% | ||||
Financials | 12.0% | ||||
Materials | 6.0% | ||||
Communication Services | 2.3% | ||||
Consumer Staples | 2.1% | ||||
Utilities | 1.9% | ||||
Real Estate | 1.6% | ||||
Temporary Cash Investments | 6.2% | ||||
Other Assets and Liabilities | (2.7)% |
NOTES TO SCHEDULE OF INVESTMENTS | ||||||||
ADR | - | American Depositary Receipt |
(1)Non-income producing.
See Notes to Financial Statements.
12
Statement of Assets and Liabilities |
NOVEMBER 30, 2021 | |||||
Assets | |||||
Investment securities, at value (cost of $53,726,004) | $ | 61,615,865 | |||
Receivable for investments sold | 6,521 | ||||
Receivable for capital shares sold | 108,729 | ||||
Dividends and interest receivable | 84,740 | ||||
Securities lending receivable | 64 | ||||
61,815,919 | |||||
Liabilities | |||||
Payable for investments purchased | 1,755,327 | ||||
Payable for capital shares redeemed | 515 | ||||
Accrued management fees | 35,552 | ||||
Distribution and service fees payable | 556 | ||||
1,791,950 | |||||
Net Assets | $ | 60,023,969 | |||
Net Assets Consist of: | |||||
Capital (par value and paid-in surplus) | $ | 50,629,772 | |||
Distributable earnings | 9,394,197 | ||||
$ | 60,023,969 |
Net Assets | Shares Outstanding | Net Asset Value Per Share | |||||||||
Investor Class, $0.01 Par Value | $22,250,225 | 1,110,250 | $20.04 | ||||||||
I Class, $0.01 Par Value | $19,111,130 | 946,599 | $20.19 | ||||||||
A Class, $0.01 Par Value | $98,949 | 4,985 | $19.85* | ||||||||
C Class, $0.01 Par Value | $58,253 | 3,038 | $19.17 | ||||||||
R Class, $0.01 Par Value | $1,148,282 | 58,392 | $19.67 | ||||||||
R6 Class, $0.01 Par Value | $673,625 | 33,184 | $20.30 | ||||||||
G Class, $0.01 Par Value | $16,683,505 | 804,449 | $20.74 |
*Maximum offering price $21.06 (net asset value divided by 0.9425).
See Notes to Financial Statements.
13
Statement of Operations |
YEAR ENDED NOVEMBER 30, 2021 | |||||
Investment Income (Loss) | |||||
Income: | |||||
Dividends (net of foreign taxes withheld of $53,899) | $ | 417,019 | |||
Securities lending, net | 1,724 | ||||
Interest | 307 | ||||
419,050 | |||||
Expenses: | |||||
Management fees | 398,988 | ||||
Distribution and service fees: | |||||
A Class | 242 | ||||
C Class | 569 | ||||
R Class | 5,117 | ||||
Directors' fees and expenses | 1,036 | ||||
Other expenses | 1,202 | ||||
407,154 | |||||
Fees waived - G Class | (93,344) | ||||
313,810 | |||||
Net investment income (loss) | 105,240 | ||||
Realized and Unrealized Gain (Loss) | |||||
Net realized gain (loss) on: | |||||
Investment transactions | 1,479,649 | ||||
Foreign currency translation transactions | 1,663 | ||||
1,481,312 | |||||
Change in net unrealized appreciation (depreciation) on: | |||||
Investments | 749,713 | ||||
Translation of assets and liabilities in foreign currencies | 5,528 | ||||
755,241 | |||||
Net realized and unrealized gain (loss) | 2,236,553 | ||||
Net Increase (Decrease) in Net Assets Resulting from Operations | $ | 2,341,793 |
See Notes to Financial Statements.
14
Statement of Changes in Net Assets |
YEARS ENDED NOVEMBER 30, 2021 AND NOVEMBER 30, 2020 | ||||||||
Increase (Decrease) in Net Assets | November 30, 2021 | November 30, 2020 | ||||||
Operations | ||||||||
Net investment income (loss) | $ | 105,240 | $ | 13,064 | ||||
Net realized gain (loss) | 1,481,312 | (52,701) | ||||||
Change in net unrealized appreciation (depreciation) | 755,241 | 4,861,664 | ||||||
Net increase (decrease) in net assets resulting from operations | 2,341,793 | 4,822,027 | ||||||
Distributions to Shareholders | ||||||||
From earnings: | ||||||||
Investor Class | — | (231,555) | ||||||
I Class | — | (86,412) | ||||||
A Class | — | (26,816) | ||||||
C Class | — | (26,219) | ||||||
R Class | — | (16,491) | ||||||
R6 Class | — | (5,882) | ||||||
G Class | (8,055) | (46,910) | ||||||
Decrease in net assets from distributions | (8,055) | (440,285) | ||||||
Capital Share Transactions | ||||||||
Net increase (decrease) in net assets from capital share transactions (Note 5) | 36,992,889 | 3,612,428 | ||||||
Net increase (decrease) in net assets | 39,326,627 | 7,994,170 | ||||||
Net Assets | ||||||||
Beginning of period | 20,697,342 | 12,703,172 | ||||||
End of period | $ | 60,023,969 | $ | 20,697,342 |
See Notes to Financial Statements.
15
Notes to Financial Statements |
NOVEMBER 30, 2021
1. Organization
American Century World Mutual Funds, Inc. (the corporation) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company and is organized as a Maryland corporation. Focused International Growth Fund (the fund) is one fund in a series issued by the corporation. The fund's investment objective is to seek capital growth.
The fund offers the Investor Class, I Class, A Class, C Class, R Class, R6 Class and G Class. The A Class may incur an initial sales charge. The A Class and C Class may be subject to a contingent deferred sales charge.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently followed by the fund in preparation of its financial statements. The fund is an investment company and follows accounting and reporting guidance in accordance with accounting principles generally accepted in the United States of America. This may require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from these estimates. Management evaluated the impact of events or transactions occurring through the date the financial statements were issued that would merit recognition or disclosure.
Investment Valuations — The fund determines the fair value of its investments and computes its net asset value (NAV) per share at the close of regular trading (usually 4 p.m. Eastern time) on the New York Stock Exchange (NYSE) on each day the NYSE is open. The Board of Directors has adopted valuation policies and procedures to guide the investment advisor in the fund’s investment valuation process and to provide methodologies for the oversight of the fund’s pricing function.
Equity securities that are listed or traded on a domestic securities exchange are valued at the last reported sales price or at the official closing price as provided by the exchange. Equity securities traded on foreign securities exchanges are generally valued at the closing price of such securities on the exchange where primarily traded or at the close of the NYSE, if that is earlier. If no last sales price is reported, or if local convention or regulation so provides, the mean of the latest bid and asked prices may be used. Securities traded over-the-counter are valued at the mean of the latest bid and asked prices, the last sales price, or the official closing price. Equity securities initially expressed in local currencies are translated into U.S. dollars at the mean of the appropriate currency exchange rate at the close of the NYSE as provided by an independent pricing service.
Open-end management investment companies are valued at the reported NAV per share. Repurchase agreements are valued at cost, which approximates fair value.
If the fund determines that the market price for an investment is not readily available or the valuation methods mentioned above do not reflect an investment’s fair value, such investment is valued as determined in good faith by the Board of Directors or its delegate, in accordance with policies and procedures adopted by the Board of Directors. In its determination of fair value, the fund may review several factors including, but not limited to, market information regarding the specific investment or comparable investments and correlation with other investment types, futures indices or general market indicators. Circumstances that may cause the fund to use these procedures to value an investment include, but are not limited to: an investment has been declared in default or is distressed; trading in a security has been suspended during the trading day or a security is not actively trading on its principal exchange; prices received from a regular pricing source are deemed unreliable; or there is a foreign market holiday and no trading occurred.
The fund monitors for significant events occurring after the close of an investment’s primary exchange but before the fund’s NAV per share is determined. Significant events may include, but are not limited to: corporate announcements and transactions; governmental action and political unrest that could impact a specific investment or an investment sector; or armed conflicts, natural disasters and similar events that could affect investments in a specific country or region. The fund also monitors for significant fluctuations between domestic and foreign markets, as evidenced by the U.S. market or such other indicators that the Board of Directors, or its delegate, deems appropriate. The fund may apply a model-derived factor to the closing price
16
of equity securities traded on foreign securities exchanges. The factor is based on observable market data as provided by an independent pricing service.
Security Transactions — Security transactions are accounted for as of the trade date. Net realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes.
Investment Income — Dividend income less foreign taxes withheld, if any, is recorded as of the ex-dividend date. Distributions received on securities that represent a return of capital or long-term capital gain are recorded as a reduction of cost of investments and/or as a realized gain. The fund may estimate the components of distributions received that may be considered nontaxable distributions or long-term capital gain distributions for income tax purposes. Interest income is recorded on the accrual basis and includes accretion of discounts and amortization of premiums. Securities lending income is net of fees and rebates earned by the lending agent for its services.
Foreign Currency Translations — All assets and liabilities initially expressed in foreign currencies are translated into U.S. dollars at prevailing exchange rates at period end. The fund may enter into spot foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of investment securities, dividend and interest income, spot foreign currency exchange contracts, and expenses are translated at the rates of exchange prevailing on the respective dates of such transactions. Net realized and unrealized foreign currency exchange gains or losses related to investment securities are a component of net realized gain (loss) on investment transactions and change in net unrealized appreciation (depreciation) on investments, respectively.
Repurchase Agreements — The fund may enter into repurchase agreements with institutions that American Century Investment Management, Inc. (ACIM) (the investment advisor) has determined are creditworthy pursuant to criteria adopted by the Board of Directors. The fund requires that the collateral, represented by securities, received in a repurchase transaction be transferred to the custodian in a manner sufficient to enable the fund to obtain those securities in the event of a default under the repurchase agreement. ACIM monitors, on a daily basis, the securities transferred to ensure the value, including accrued interest, of the securities under each repurchase agreement is equal to or greater than amounts owed to the fund under each repurchase agreement.
Joint Trading Account — Pursuant to an Exemptive Order issued by the Securities and Exchange Commission, the fund, along with certain other funds in the American Century Investments family of funds, may transfer uninvested cash balances into a joint trading account. These balances are invested in one or more repurchase agreements that are collateralized by U.S. Treasury or Agency obligations.
Segregated Assets — In accordance with the 1940 Act, the fund segregates assets on its books and records to cover certain types of investment securities and other financial instruments. ACIM monitors, on a daily basis, the securities segregated to ensure the fund designates a sufficient amount of liquid assets, marked-to-market daily. The fund may also receive assets or be required to pledge assets at the custodian bank or with a broker for collateral requirements.
Income Tax Status — It is the fund’s policy to distribute substantially all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code. Accordingly, no provision has been made for income taxes. The fund files U.S. federal, state, local and non-U.S. tax returns as applicable. The fund's tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years from the date of filing but can be longer in certain jurisdictions. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Multiple Class — All shares of the fund represent an equal pro rata interest in the net assets of the class to which such shares belong, and have identical voting, dividend, liquidation and other rights and the same terms and conditions, except for class specific expenses and exclusive rights to vote on matters affecting only individual classes. Income, non-class specific expenses, and realized and unrealized capital gains and losses of the fund are allocated to each class of shares based on their relative net assets.
Distributions to Shareholders — Distributions from net investment income and net realized gains, if any, are generally declared and paid annually. The fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code, in all events in a manner consistent with provisions of the 1940 Act.
17
Indemnifications — Under the corporation’s organizational documents, its officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business, the fund enters into contracts that provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against a fund. The risk of material loss from such claims is considered by management to be remote.
Securities Lending — Securities are lent to qualified financial institutions and brokers. State Street Bank & Trust Co. serves as securities lending agent to the fund pursuant to a Securities Lending Agreement. The lending of securities exposes the fund to risks such as: the borrowers may fail to return the loaned securities, the borrowers may not be able to provide additional collateral, the fund may experience delays in recovery of the loaned securities or delays in access to collateral, or the fund may experience losses related to the investment collateral. To minimize certain risks, loan counterparties pledge collateral in the form of cash and/or securities. The lending agent has agreed to indemnify the fund in the case of default of any securities borrowed. Cash collateral received is invested in the State Street Navigator Securities Lending Government Money Market Portfolio, a money market mutual fund registered under the 1940 Act. The loans may also be secured by U.S. government securities in an amount at least equal to the market value of the securities loaned, plus accrued interest and dividends, determined on a daily basis and adjusted accordingly. By lending securities, the fund seeks to increase its net investment income through the receipt of interest and fees. Such income is reflected separately within the Statement of Operations. The value of loaned securities and related collateral outstanding at period end, if any, are shown on a gross basis within the Schedule of Investments and Statement of Assets and Liabilities.
3. Fees and Transactions with Related Parties
Certain officers and directors of the corporation are also officers and/or directors of American Century Companies, Inc. (ACC). The corporation’s investment advisor, ACIM, the corporation's distributor, American Century Investment Services, Inc. (ACIS), and the corporation’s transfer agent, American Century Services, LLC, are wholly owned, directly or indirectly, by ACC.
Management Fees — The corporation has entered into a management agreement with ACIM, under which ACIM provides the fund with investment advisory and management services in exchange for a single, unified management fee (the fee) per class. The agreement provides that ACIM will pay all expenses of managing and operating the fund, except brokerage expenses, taxes, interest, fees and expenses of the independent directors (including legal counsel fees), extraordinary expenses, and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the 1940 Act. The fee is computed and accrued daily based on each class's daily net assets and paid monthly in arrears. The difference in the fee among the classes is a result of their separate arrangements for non-Rule 12b-1 shareholder services. It is not the result of any difference in advisory or custodial fees or other expenses related to the management of the fund’s assets, which do not vary by class. The investment advisor agreed to waive the G Class's management fee in its entirety. The investment advisor expects this waiver to remain in effect permanently and cannot terminate it without the approval of the Board of Directors.
The annual management fee for each class is as follows:
Investor Class | I Class | A Class | C Class | R Class | R6 Class | G Class | ||||||||||||||
1.09% | 0.89% | 1.09% | 1.09% | 1.09% | 0.74% | 0.00%(1) |
(1)Annual management fee before waiver was 0.74%.
Distribution and Service Fees — The Board of Directors has adopted a separate Master Distribution and Individual Shareholder Services Plan for each of the A Class, C Class and R Class (collectively the plans), pursuant to Rule 12b-1 of the 1940 Act. The plans provide that the A Class will pay ACIS an annual distribution and service fee of 0.25%. The plans provide that the C Class will pay ACIS an annual distribution and service fee of 1.00%, of which 0.25% is paid for individual shareholder services and 0.75% is paid for distribution services. The plans provide that the R Class will pay ACIS an annual distribution and service fee of 0.50%. The fees are computed and accrued daily based on each class’s daily net assets and paid monthly in arrears. The fees are used to pay financial intermediaries for distribution and individual shareholder services. Fees incurred under the plans during the period ended November 30, 2021 are detailed in the Statement of Operations.
Directors' Fees and Expenses — The Board of Directors is responsible for overseeing the investment advisor’s management and operations of the fund. The directors receive detailed information about the fund and its investment advisor regularly throughout the year, and meet at least quarterly with management of the
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investment advisor to review reports about fund operations. The fund's officers do not receive compensation from the fund.
Interfund Transactions — The fund may enter into security transactions with other American Century Investments funds and other client accounts of the investment advisor, in accordance with the 1940 Act rules and procedures adopted by the Board of Directors. The rules and procedures require, among other things, that these transactions be effected at the independent current market price of the security. During the period, the interfund purchases were $120,068 and there were no interfund sales.
4. Investment Transactions
Purchases and sales of investment securities, excluding short-term investments, for the period ended November 30, 2021 were $64,893,927 and $28,922,233, respectively.
5. Capital Share Transactions
Transactions in shares of the fund were as follows:
Year ended November 30, 2021 | Year ended November 30, 2020 | |||||||||||||
Shares | Amount | Shares | Amount | |||||||||||
Investor Class/Shares Authorized | 50,000,000 | 50,000,000 | ||||||||||||
Sold | 857,589 | $ | 17,115,465 | 444,978 | $ | 6,842,135 | ||||||||
Issued in reinvestment of distributions | — | — | 16,376 | 229,083 | ||||||||||
Redeemed | (282,928) | (5,620,204) | (391,362) | (5,932,032) | ||||||||||
574,661 | 11,495,261 | 69,992 | 1,139,186 | |||||||||||
I Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 807,288 | 16,390,886 | 360,602 | 5,962,098 | ||||||||||
Issued in reinvestment of distributions | — | — | 6,159 | 86,412 | ||||||||||
Redeemed | (165,920) | (3,429,687) | (242,553) | (3,916,623) | ||||||||||
641,368 | 12,961,199 | 124,208 | 2,131,887 | |||||||||||
A Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 517 | 10,148 | 3,159 | 53,590 | ||||||||||
Issued in reinvestment of distributions | — | — | 1,925 | 26,816 | ||||||||||
Redeemed | (241) | (4,730) | (57,907) | (1,014,907) | ||||||||||
276 | 5,418 | (52,823) | (934,501) | |||||||||||
C Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 438 | 8,519 | 2,105 | 31,528 | ||||||||||
Issued in reinvestment of distributions | — | — | 1,921 | 26,219 | ||||||||||
Redeemed | (208) | (3,915) | (57,410) | (979,320) | ||||||||||
230 | 4,604 | (53,384) | (921,573) | |||||||||||
R Class/Shares Authorized | 20,000,000 | 20,000,000 | ||||||||||||
Sold | 32,272 | 629,630 | 24,980 | 357,602 | ||||||||||
Issued in reinvestment of distributions | — | — | 1,193 | 16,491 | ||||||||||
Redeemed | (11,945) | (241,001) | (21,018) | (324,511) | ||||||||||
20,327 | 388,629 | 5,155 | 49,582 | |||||||||||
R6 Class/Shares Authorized | 20,000,000 | 20,000,000 | ||||||||||||
Sold | 41,763 | 879,551 | 170 | 2,596 | ||||||||||
Issued in reinvestment of distributions | — | — | 418 | 5,882 | ||||||||||
Redeemed | (18,901) | (383,494) | (2,884) | (50,420) | ||||||||||
22,862 | 496,057 | (2,296) | (41,942) | |||||||||||
G Class/Shares Authorized | 40,000,000 | 40,000,000 | ||||||||||||
Sold | 638,105 | 13,047,998 | 178,453 | 2,580,442 | ||||||||||
Issued in reinvestment of distributions | 414 | 8,055 | 3,350 | 46,910 | ||||||||||
Redeemed | (67,687) | (1,414,332) | (28,318) | (437,563) | ||||||||||
570,832 | 11,641,721 | 153,485 | 2,189,789 | |||||||||||
Net increase (decrease) | 1,830,556 | $ | 36,992,889 | 244,337 | $ | 3,612,428 |
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6. Fair Value Measurements
The fund’s investments valuation process is based on several considerations and may use multiple inputs to determine the fair value of the investments held by the fund. In conformity with accounting principles generally accepted in the United States of America, the inputs used to determine a valuation are classified into three broad levels.
•Level 1 valuation inputs consist of unadjusted quoted prices in an active market for identical investments.
•Level 2 valuation inputs consist of direct or indirect observable market data (including quoted prices for comparable investments, evaluations of subsequent market events, interest rates, prepayment speeds, credit risk, etc.). These inputs also consist of quoted prices for identical investments initially expressed in local currencies that are adjusted through translation into U.S. dollars.
•Level 3 valuation inputs consist of unobservable data (including a fund’s own assumptions).
The level classification is based on the lowest level input that is significant to the fair valuation measurement. The valuation inputs are not necessarily an indication of the risks associated with investing in these securities or other financial instruments.
The following is a summary of the level classifications as of period end. The Schedule of Investments provides additional information on the fund’s portfolio holdings.
Level 1 | Level 2 | Level 3 | |||||||||
Assets | |||||||||||
Investment Securities | |||||||||||
Common Stocks | |||||||||||
Australia | $ | 752,640 | $ | 1,456,831 | — | ||||||
Canada | 957,242 | 1,970,412 | — | ||||||||
India | 1,092,040 | — | — | ||||||||
Ireland | 2,571,970 | — | — | ||||||||
Other Countries | — | 49,106,799 | — | ||||||||
Temporary Cash Investments | 13,218 | 3,694,713�� | — | ||||||||
$ | 5,387,110 | $ | 56,228,755 | — |
7. Risk Factors
The value of the fund’s shares will go up and down, sometimes rapidly or unpredictably, based on the performance of the securities owned by the fund and other factors generally affecting the securities market. Market risks, including political, regulatory, economic and social developments, can affect the value of the fund’s investments. Natural disasters, public health emergencies, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse long-term effects on world economies and markets generally.
There are certain risks involved in investing in foreign securities. These risks include those resulting from political events (such as civil unrest, national elections and imposition of exchange controls), social and economic events (such as labor strikes and rising inflation), and natural disasters. Securities of foreign issuers may be less liquid and more volatile. Investing in emerging markets or a significant portion of assets in one country or region may accentuate these risks.
8. Federal Tax Information
On December 21, 2021, the fund declared and paid a per-share distribution from net realized gains to shareholders of record on December 20, 2021 of $0.4979 for the Investor Class, I Class, A Class, C Class, R Class, R6 Class and G Class.
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On December 21, 2021, the fund declared and paid the following per-share distributions from net investment income to shareholders of record on December 20, 2021:
Investor Class | I Class | A Class | C Class | R Class | R6 Class | G Class | ||||||||||||||
— | — | — | — | — | $0.0182 | $0.1307 |
The tax character of distributions paid during the years ended November 30, 2021 and November 30, 2020 were as follows:
2021 | 2020 | |||||||
Distributions Paid From | ||||||||
Ordinary income | $ | 8,055 | $ | 83 | ||||
Long-term capital gains | — | $ | 440,202 |
The book-basis character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements.
As of period end, the federal tax cost of investments and the components of distributable earnings on a tax-basis were as follows:
Federal tax cost of investments | $ | 53,836,258 | |||
Gross tax appreciation of investments | $ | 9,084,898 | |||
Gross tax depreciation of investments | (1,305,291) | ||||
Net tax appreciation (depreciation) of investments | 7,779,607 | ||||
Net tax appreciation (depreciation) on translation of assets and liabilities in foreign currencies | 6,598 | ||||
Net tax appreciation (depreciation) | $ | 7,786,205 | |||
Undistributed ordinary income | $ | 106,902 | |||
Accumulated long-term gains | $ | 1,501,090 |
The difference between book-basis and tax-basis unrealized appreciation (depreciation) is attributable primarily to the tax deferral of losses on wash sales.
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Financial Highlights |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Operating Expenses (before expense waiver) | Net Investment Income (Loss) | Net Investment Income (Loss) (before expense waiver) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||||||
Investor Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $18.20 | (0.03) | 1.87 | 1.84 | — | — | — | $20.04 | 10.11% | 1.10% | 1.10% | (0.12)% | (0.12)% | 71% | $22,250 | ||||||||||||||||||||||||||||||||
2020 | $14.34 | (0.01) | 4.33 | 4.32 | — | (0.46) | (0.46) | $18.20 | 31.15% | 1.18% | 1.18% | (0.09)% | (0.09)% | 92% | $9,749 | ||||||||||||||||||||||||||||||||
2019 | $11.92 | 0.02 | 2.46 | 2.48 | (0.06) | — | (0.06) | $14.34 | 20.96% | 1.24% | 1.24% | 0.13% | 0.13% | 96% | $6,677 | ||||||||||||||||||||||||||||||||
2018 | $12.81 | 0.08 | (0.97) | (0.89) | — | — | — | $11.92 | (6.95)% | 1.23% | 1.23% | 0.59% | 0.59% | 82% | $6,180 | ||||||||||||||||||||||||||||||||
2017 | $9.75 | 0.01 | 3.13 | 3.14 | (0.08) | — | (0.08) | $12.81 | 32.40% | 1.24% | 1.24% | 0.14% | 0.14% | 76% | $5,882 | ||||||||||||||||||||||||||||||||
I Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $18.30 | 0.01 | 1.88 | 1.89 | — | — | — | $20.19 | 10.33% | 0.90% | 0.90% | 0.08% | 0.08% | 71% | $19,111 | ||||||||||||||||||||||||||||||||
2020 | $14.39 | 0.01 | 4.36 | 4.37 | — | (0.46) | (0.46) | $18.30 | 31.39% | 0.98% | 0.98% | 0.11% | 0.11% | 92% | $5,585 | ||||||||||||||||||||||||||||||||
2019 | $11.96 | 0.02 | 2.49 | 2.51 | (0.08) | — | (0.08) | $14.39 | 21.21% | 1.04% | 1.04% | 0.33% | 0.33% | 96% | $2,605 | ||||||||||||||||||||||||||||||||
2018 | $12.83 | 0.09 | (0.96) | (0.87) | — | — | — | $11.96 | (6.78)% | 1.03% | 1.03% | 0.79% | 0.79% | 82% | $776 | ||||||||||||||||||||||||||||||||
2017 | $9.76 | 0.05 | 3.11 | 3.16 | (0.09) | — | (0.09) | $12.83 | 32.74% | 1.04% | 1.04% | 0.34% | 0.34% | 76% | $777 |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Operating Expenses (before expense waiver) | Net Investment Income (Loss) | Net Investment Income (Loss) (before expense waiver) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||||||
A Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $18.07 | (0.07) | 1.85 | 1.78 | — | — | — | $19.85 | 9.85% | 1.35% | 1.35% | (0.37)% | (0.37)% | 71% | $99 | ||||||||||||||||||||||||||||||||
2020 | $14.28 | (0.04) | 4.29 | 4.25 | — | (0.46) | (0.46) | $18.07 | 30.78% | 1.43% | 1.43% | (0.34)% | (0.34)% | 92% | $85 | ||||||||||||||||||||||||||||||||
2019 | $11.87 | —(3) | 2.44 | 2.44 | (0.03) | — | (0.03) | $14.28 | 20.66% | 1.49% | 1.49% | (0.12)% | (0.12)% | 96% | $822 | ||||||||||||||||||||||||||||||||
2018 | $12.79 | 0.03 | (0.95) | (0.92) | — | — | — | $11.87 | (7.19)% | 1.48% | 1.48% | 0.34% | 0.34% | 82% | $1,217 | ||||||||||||||||||||||||||||||||
2017 | $9.73 | (0.01) | 3.12 | 3.11 | (0.05) | — | (0.05) | $12.79 | 32.13% | 1.49% | 1.49% | (0.11)% | (0.11)% | 76% | $1,295 | ||||||||||||||||||||||||||||||||
C Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $17.59 | (0.22) | 1.80 | 1.58 | — | — | — | $19.17 | 9.04% | 2.10% | 2.10% | (1.12)% | (1.12)% | 71% | $58 | ||||||||||||||||||||||||||||||||
2020 | $14.01 | (0.14) | 4.18 | 4.04 | — | (0.46) | (0.46) | $17.59 | 29.84% | 2.18% | 2.18% | (1.09)% | (1.09)% | 92% | $49 | ||||||||||||||||||||||||||||||||
2019 | $11.70 | (0.09) | 2.40 | 2.31 | — | — | — | $14.01 | 19.85% | 2.24% | 2.24% | (0.87)% | (0.87)% | 96% | $787 | ||||||||||||||||||||||||||||||||
2018 | $12.70 | (0.07) | (0.93) | (1.00) | — | — | — | $11.70 | (7.95)% | 2.23% | 2.23% | (0.41)% | (0.41)% | 82% | $1,170 | ||||||||||||||||||||||||||||||||
2017 | $9.68 | (0.09) | 3.11 | 3.02 | — | — | — | $12.70 | 31.20% | 2.24% | 2.24% | (0.86)% | (0.86)% | 76% | $1,270 | ||||||||||||||||||||||||||||||||
R Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $17.95 | (0.12) | 1.84 | 1.72 | — | — | — | $19.67 | 9.58% | 1.60% | 1.60% | (0.62)% | (0.62)% | 71% | $1,148 | ||||||||||||||||||||||||||||||||
2020 | $14.22 | (0.08) | 4.27 | 4.19 | — | (0.46) | (0.46) | $17.95 | 30.47% | 1.68% | 1.68% | (0.59)% | (0.59)% | 92% | $683 | ||||||||||||||||||||||||||||||||
2019 | $11.82 | (0.04) | 2.44 | 2.40 | —(3) | — | —(3) | $14.22 | 20.36% | 1.74% | 1.74% | (0.37)% | (0.37)% | 96% | $468 | ||||||||||||||||||||||||||||||||
2018 | $12.77 | —(3) | (0.95) | (0.95) | — | — | — | $11.82 | (7.44)% | 1.73% | 1.73% | 0.09% | 0.09% | 82% | $406 | ||||||||||||||||||||||||||||||||
2017 | $9.72 | (0.04) | 3.12 | 3.08 | (0.03) | — | (0.03) | $12.77 | 31.73% | 1.74% | 1.74% | (0.36)% | (0.36)% | 76% | $298 |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Operating Expenses (before expense waiver) | Net Investment Income (Loss) | Net Investment Income (Loss) (before expense waiver) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||||||
R6 Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $18.37 | 0.02 | 1.91 | 1.93 | — | — | — | $20.30 | 10.51% | 0.75% | 0.75% | 0.23% | 0.23% | 71% | $674 | ||||||||||||||||||||||||||||||||
2020 | $14.42 | 0.05 | 4.36 | 4.41 | — | (0.46) | (0.46) | $18.37 | 31.61% | 0.83% | 0.83% | 0.26% | 0.26% | 92% | $190 | ||||||||||||||||||||||||||||||||
2019 | $11.99 | 0.08 | 2.45 | 2.53 | (0.10) | — | (0.10) | $14.42 | 21.34% | 0.89% | 0.89% | 0.48% | 0.48% | 96% | $182 | ||||||||||||||||||||||||||||||||
2018 | $12.84 | 0.11 | (0.96) | (0.85) | — | — | — | $11.99 | (6.62)% | 0.88% | 0.88% | 0.94% | 0.94% | 82% | $242 | ||||||||||||||||||||||||||||||||
2017 | $9.77 | 0.06 | 3.12 | 3.18 | (0.11) | — | (0.11) | $12.84 | 32.90% | 0.89% | 0.89% | 0.49% | 0.49% | 76% | $260 | ||||||||||||||||||||||||||||||||
G Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $18.65 | 0.21 | 1.89 | 2.10 | (0.01) | — | (0.01) | $20.74 | 11.28% | 0.01% | 0.75% | 0.97% | 0.23% | 71% | $16,684 | ||||||||||||||||||||||||||||||||
2020 | $14.51 | 0.17 | 4.43 | 4.60 | — | (0.46) | (0.46) | $18.65 | 32.75% | 0.00% | 0.83% | 1.09% | 0.26% | 92% | $4,356 | ||||||||||||||||||||||||||||||||
2019(4) | $12.94 | 0.12 | 1.45 | 1.57 | — | — | — | $14.51 | 12.13% | 0.01%(5) | 0.89%(5) | 1.29%(5) | 0.41%(5) | 96%(6) | $1,163 |
Notes to Financial Highlights |
(1)Computed using average shares outstanding throughout the period.
(2)Total returns are calculated based on the net asset value of the last business day and do not reflect applicable sales charges, if any. Total returns for periods less than one year are not annualized.
(3)Per-share amount was less than $0.005.
(4)April 1, 2019 (commencement of sale) through November 30, 2019.
(5)Annualized.
(6)Portfolio turnover is calculated at the fund level. Percentage indicated was calculated for the year ended November 30, 2019.
See Notes to Financial Statements.
Report of Independent Registered Public Accounting Firm |
To the Shareholders and the Board of Directors of American Century World Mutual Funds, Inc.:
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Focused International Growth Fund (the “Fund”), one of the funds constituting the American Century World Mutual Funds, Inc., as of November 30, 2021, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of Focused International Growth Fund of the American Century World Mutual Funds, Inc. as of November 30, 2021, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund’s financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. 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, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of November 30, 2021, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
/s/ Deloitte & Touche LLP
Kansas City, Missouri
January 19, 2022
We have served as the auditor of one or more American Century investment companies since 1997.
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Management |
The Board of Directors
The individuals listed below serve as directors of the funds. Each director will continue to serve in this capacity until death, retirement, resignation or removal from office. The board has adopted a mandatory retirement age for directors who are not “interested persons,” as that term is defined in the Investment Company Act (independent directors). Independent directors shall retire by December 31 of the year in which they reach their 75th birthday.
Jonathan S. Thomas is an “interested person” because he currently serves as President and Chief Executive Officer of American Century Companies, Inc. (ACC), the parent company of American Century Investment Management, Inc. (ACIM or the advisor). The other directors (more than three-fourths of the total number) are independent. They are not employees, directors or officers of, and have no financial interest in, ACC or any of its wholly owned, direct or indirect, subsidiaries, including ACIM, American Century Investment Services, Inc. (ACIS) and American Century Services, LLC (ACS), and they do not have any other affiliations, positions or relationships that would cause them to be considered “interested persons” under the Investment Company Act. The directors serve in this capacity for seven (in the case of Jonathan S. Thomas, 16; and Stephen E. Yates, 8) registered investment companies in the American Century Investments family of funds.
The following table presents additional information about the directors. The mailing address for each director is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Thomas W. Bunn (1953) | Director | Since 2017 | Retired | 72 | SquareTwo Financial; Barings (formerly Babson Capital Funds Trust) (2013 to 2016) | ||||||||||||
Chris H. Cheesman (1962) | Director | Since 2019 | Retired. Senior Vice President & Chief Audit Executive, AllianceBernstein (1999 to 2018) | 72 | Alleghany Corporation | ||||||||||||
Barry Fink (1955) | Director | Since 2012 (independent since 2016) | Retired | 72 | None | ||||||||||||
Rajesh K. Gupta (1960) | Director | Since 2019 | Partner Emeritus, SeaCrest Investment Management and SeaCrest Wealth Management (2019 to Present); Chief Executive Officer and Chief Investment Officer, SeaCrest Investment Management (2006 to 2019); Chief Executive Officer and Chief Investment Officer, SeaCrest Wealth Management (2008 to 2019) | 72 | None |
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Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Lynn Jenkins (1963) | Director | Since 2019 | Consultant, LJ Strategies (2019 to present); United States Representative, U.S. House of Representatives (2009 to 2018) | 72 | MGP Ingredients, Inc. (2019 to 2021) | ||||||||||||
Jan M. Lewis (1957) | Director | Since 2011 | Retired | 72 | None | ||||||||||||
John R. Whitten(1) (1946) | Director | Since 2008 | Retired | 72 | Onto Innovation Inc. (2019 to 2020); Rudolph Technologies, Inc. (2006 to 2019) | ||||||||||||
Stephen E. Yates (1948) | Director and Chairman of the Board | Since 2012 (Chairman since 2018) | Retired | 108 | None | ||||||||||||
Interested Director | |||||||||||||||||
Jonathan S. Thomas (1963) | Director | Since 2007 | President and Chief Executive Officer, ACC (2007 to present). Also serves as Chief Executive Officer, ACS; Director, ACC and other ACC subsidiaries | 146 | None |
(1) Effective December 31, 2021, John R. Whitten retired from the Board of Directors.
The Statement of Additional Information has additional information about the fund's directors and is available without charge, upon request, by calling 1-800-345-2021.
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Officers
The following table presents certain information about the executive officers of the funds. Each officer serves as an officer for each of the 16 (in the case of Robert J. Leach, 15) investment companies in the American Century family of funds. No officer is compensated for his or her service as an officer of the funds. The listed officers are interested persons of the funds and are appointed or re-appointed on an annual basis. The mailing address for each officer listed below is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Offices with the Funds | Principal Occupation(s) During the Past Five Years | ||||||
Patrick Bannigan (1965) | President since 2019 | Executive Vice President and Director, ACC (2012 to present); Chief Financial Officer, Chief Accounting Officer and Treasurer, ACC (2015 to present). Also serves as President, ACS; Vice President, ACIM; Chief Financial Officer, Chief Accounting Officer and/or Director, ACIM, ACS and other ACC subsidiaries | ||||||
R. Wes Campbell (1974) | Chief Financial Officer and Treasurer since 2018 | Vice President, ACS, (2020 to present); Investment Operations and Investment Accounting, ACS (2000 to present) | ||||||
Amy D. Shelton (1964) | Chief Compliance Officer and Vice President since 2014 | Chief Compliance Officer, American Century funds, (2014 to present); Chief Compliance Officer, ACIM (2014 to present); Chief Compliance Officer, ACIS (2009 to present). Also serves as Vice President, ACIS | ||||||
John Pak (1968) | General Counsel and Senior Vice President since 2021 | General Counsel and Senior Vice President, ACC (2021 to present). Also serves as General Counsel and Senior Vice President, ACIM, ACS and ACIS. Chief Legal Officer of Investment and Wealth Management, The Bank of New York Mellon (2014 to 2021) | ||||||
C. Jean Wade (1964) | Vice President since 2012 | Senior Vice President, ACS (2017 to present); Vice President, ACS (2000 to 2017) | ||||||
Robert J. Leach (1966) | Vice President since 2006 | Vice President, ACS (2000 to present) | ||||||
David H. Reinmiller (1963) | Vice President since 2000 | Attorney, ACC (1994 to present). Also serves as Vice President, ACIM and ACS | ||||||
Ward D. Stauffer (1960) | Secretary since 2005 | Attorney, ACC (2003 to present) |
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Approval of Management Agreement |
At a meeting held on June 30, 2021, the Fund’s Board of Directors (the "Board") unanimously approved the renewal of the management agreement pursuant to which American Century Investment Management, Inc. (the “Advisor”) acts as the investment advisor for the Fund. Under Section 15(c) of the Investment Company Act, contracts for investment advisory services are required to be reviewed, evaluated, and approved by a majority of a fund’s directors (the “Directors”), including a majority of the independent Directors, each year.
Prior to its consideration of the renewal of the management agreement, the Directors requested and reviewed extensive data and information compiled by the Advisor and certain independent providers of evaluation data concerning the Fund and the services provided to the Fund by the Advisor. This review was in addition to the oversight and evaluation undertaken by the Board and its committees on a continual basis and the information received was supplemental to the extensive information that the Board and its committees receive and consider throughout the year.
In connection with its consideration of the renewal of the management agreement, the Board’s review and evaluation of the services provided by the Advisor and its affiliates included, but was not limited to, the following:
•the nature, extent, and quality of investment management, shareholder services, and other services provided and to be provided to the Fund including without limitation portfolio management and trading services, shareholder and intermediary services, compliance and legal services, fund accounting and financial reporting, and fund share distribution;
•the wide range of other programs and services provided and to be provided to the Fund and its shareholders on a routine and non-routine basis;
•the Fund’s investment performance, including data comparing the Fund's performance to appropriate benchmarks and/or a peer group of other mutual funds with similar investment objectives and strategies;
•the cost of owning the Fund compared to the cost of owning similar funds;
•the compliance policies, procedures, and regulatory experience of the Advisor and the Fund's service providers;
•the Advisor’s strategic plans, COVID-19 pandemic response, vendor management practices, and social justice initiatives;
•the Advisor’s business continuity plans and cyber security practices;
•financial data showing the cost of services provided to the Fund, the profitability of the Fund to the Advisor, and the overall profitability of the Advisor;
•possible economies of scale associated with the Advisor’s management of the Fund and other accounts;
•services provided and charges to the Advisor's other investment management clients;
•acquired fund fees and expenses;
•payments and practices in connection with financial intermediaries holding shares of the Fund and the services provided by intermediaries in connection therewith; and
•possible collateral benefits to the Advisor from the management of the Fund.
The Board held two meetings to consider the renewal. The independent Directors also met in private session three times to review and discuss the information provided in response to their request. The independent Directors held active discussions with the Advisor regarding the renewal of the management agreement, requesting supplemental information, and reviewing information provided by the Advisor in response thereto. The independent Directors had the benefit of the advice of their independent counsel throughout the process.
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Factors Considered
The Directors considered all of the information provided by the Advisor, the independent data providers, and independent counsel in connection with the approval. They determined that the information was sufficient for them to evaluate the management agreement for the Fund. In connection with their review, the Directors did not identify any single factor as being all-important or controlling, and each Director may have attributed different levels of importance to different factors. In deciding to renew the management agreement, the Board based its decision on a number of factors, including without limitation the following:
Nature, Extent and Quality of Services — Generally. Under the management agreement, the Advisor is responsible for providing or arranging for all services necessary for the operation of the Fund. The Board noted that the Advisor provides or arranges at its own expense a wide variety of services which include the following:
•constructing and designing the Fund
•portfolio research and security selection
•initial capitalization/funding
•securities trading
•Fund administration
•custody of Fund assets
•daily valuation of the Fund’s portfolio
•liquidity monitoring and management
•risk management, including cyber security
•shareholder servicing and transfer agency, including shareholder confirmations, recordkeeping, and communications
•legal services (except the independent Directors’ counsel)
•regulatory and portfolio compliance
•financial reporting
•marketing and distribution (except amounts paid by the Fund under Rule 12b-1 plans)
The Board noted that many of these services have expanded over time in terms of both quantity and complexity in response to shareholder demands, competition in the industry, changing distribution channels, and the changing regulatory environment.
Investment Management Services. The nature of the investment management services provided to the Fund is quite complex and allows Fund shareholders access to professional money management, instant diversification of their investments within an asset class, the opportunity to easily diversify among asset classes by investing in or exchanging among various American Century Investments funds, and liquidity. In evaluating investment performance, the Board expects the Advisor to manage the Fund in accordance with its investment objectives and approved strategies. Further, the Directors recognize that the Advisor has an obligation to monitor trading activities, and in particular to seek the best execution of fund trades, and to evaluate the use of and payment for research. In providing these services, the Advisor utilizes teams of investment professionals (portfolio managers, analysts, research assistants, and securities traders) who require extensive information technology, research, training, compliance, and other systems to conduct their business. The Board, directly and through its Fund Performance Review Committee, provides oversight of the investment performance process. It regularly reviews investment performance information for the Fund, together with comparative information for appropriate benchmarks and/or peer groups of similarly-managed funds, over different time horizons. The Directors also review investment performance information during the management agreement renewal process. If performance concerns are identified, the Fund receives special reviews until performance improves, during which the Board discusses with the Advisor the reasons for such results (e.g., market conditions, security selection) and any efforts being undertaken to improve performance. The Fund’s performance was above its benchmark for the one- and three-year periods reviewed by the Board. The Board found the investment management services provided by the Advisor to the Fund to be satisfactory and consistent with the management agreement.
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Shareholder and Other Services. Under the management agreement, the Advisor provides the Fund with a comprehensive package of transfer agency, shareholder, and other services. The Board, directly and through its various committees, regularly reviews reports and evaluations of such services at its regular meetings. These reports include, but are not limited to, information regarding the operational efficiency and accuracy of the shareholder and transfer agency services provided, staffing levels, shareholder satisfaction, technology support (including cyber security), new products and services offered to Fund shareholders, securities trading activities, portfolio valuation services, auditing services, and legal and operational compliance activities. The Board found the services provided by the Advisor to the Fund under the management agreement to be competitive and of high quality.
Costs of Services and Profitability. The Advisor provides detailed information concerning its cost of providing various services to the Fund, its profitability in managing the Fund (pre- and post-distribution), its overall profitability, and its financial condition. The Directors have reviewed with the Advisor the methodology used to prepare this financial information. This information is considered in evaluating the Advisor’s financial condition, its ability to continue to provide services under the management agreement, and the reasonableness of the current management fee. The Board concluded that the Advisor’s profits were reasonable in light of the services provided to the Fund.
Ethics. The Board generally considers the Advisor’s commitment to providing quality services to shareholders and to conducting its business ethically. They noted that the Advisor’s practices generally meet or exceed industry best practices.
Economies of Scale. The Board also reviewed information provided by the Advisor regarding the possible existence of economies of scale in connection with the management of the Fund. The Board concluded that economies of scale are difficult to measure and predict with precision, especially on a fund-by-fund basis. The Board concluded that the Advisor is sharing economies of scale, to the extent they exist, through its competitive fee structure, offering competitive fees from fund inception, and through reinvestment in its business, infrastructure, investment capabilities and initiatives to provide shareholders additional content and services.
Comparison to Other Funds’ Fees. The management agreement provides that the Fund pays the Advisor a single, all-inclusive (or unified) management fee for providing all services necessary for the management and operation of the Fund, other than brokerage expenses, expenses attributable to short sales, taxes, interest, extraordinary expenses, fees and expenses of the Fund’s independent Directors (including their independent legal counsel), and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the Investment Company Act. Under the unified fee structure, the Advisor is responsible for providing all investment advisory, custody, audit, administrative, compliance, recordkeeping, marketing and shareholder services, or arranging and supervising third parties to provide such services. By contrast, most other funds are charged a variety of fees, including an investment advisory fee, a transfer agency fee, an administrative fee, distribution charges, and other expenses. Other than their investment advisory fees and any applicable Rule 12b-1 distribution fees, all other components of the total fees charged by these other funds may be increased without shareholder approval. The Board believes the unified fee structure is a benefit to Fund shareholders because it clearly discloses to shareholders the cost of owning Fund shares, and, since the unified fee cannot be increased without a vote of Fund shareholders, it shifts to the Advisor the risk of increased costs of operating the Fund and provides a direct incentive to minimize administrative inefficiencies. Part of the Board’s analysis of fee levels involves reviewing certain evaluative data compiled by an independent provider comparing the Fund’s unified fee to the total expense ratios of its peers. The unified fee charged to shareholders of the Fund was above the median of the total expense ratios of the Fund’s peer expense universe. In addition, the Board reviewed the Fund’s position relative to the narrower set of its expense group peers. The Board concluded that the management fee paid by the Fund to the Advisor under the management agreement is reasonable in light of the services provided to the Fund.
Comparison to Fees and Services Provided to Other Clients of the Advisor. The Board also requested and received information from the Advisor concerning the nature of the services, fees, costs, and profitability of its advisory services to advisory clients other than the Fund. They
32
observed that these varying types of client accounts require different services and involve different regulatory and entrepreneurial risks than the management of the Fund. The Board analyzed this information and concluded that the fees charged and services provided to the Fund were reasonable by comparison.
Payments to Intermediaries. The Directors also requested and received a description of payments made to intermediaries by the Fund and the Advisor and services provided in response thereto. These payments include various payments made by the Fund or the Advisor to different types of intermediaries and recordkeepers for distribution and service activities provided for the Fund. The Directors reviewed such information and received representations from the Advisor that all such payments by the Fund were made pursuant to the Fund's Rule 12b-1 Plan and that all such payments by the Advisor were made from the Advisor’s resources and reasonable profits. The Board found such payments to be reasonable in scope and purpose.
Collateral or “Fall-Out” Benefits Derived by the Advisor. The Board considered the possible existence of collateral benefits the Advisor may receive as a result of its relationship with the Fund. They concluded that the Advisor’s primary business is managing funds and it generally does not use fund or shareholder information to generate profits in other lines of business, and therefore does not derive any significant collateral benefits from them. To the extent there are potential collateral benefits, the Board has been advised and has taken this into consideration in its review of the management contract with the Fund. The Board noted that additional assets from other clients may offer the Advisor some benefit from increased leverage with service providers and counterparties. Additionally, the Advisor may receive proprietary research from broker-dealers that execute fund portfolio transactions, which the Board concluded is likely to benefit other clients of the Advisor, as well as Fund shareholders. The Board also determined that the Advisor is able to provide investment management services to certain clients other than the Fund, at least in part, due to its existing infrastructure built to serve the fund complex. The Board concluded that appropriate allocation methodologies had been employed to assign resources and the cost of those resources to these other clients.
Existing Relationship. The Board also considered whether there was any reason for not continuing the existing arrangement with the Advisor. In this regard, the Board was mindful of the potential disruptions of the Fund’s operations and various risks, uncertainties, and other effects that could occur as a result of a decision not to continue such relationship. In particular, the Board recognized that most shareholders have invested in the Fund on the strength of the Advisor’s industry standing and reputation and in the expectation that the Advisor will have a continuing role in providing advisory services to the Fund.
Conclusion of the Directors. As a result of this process, the Board, including all of the independent Directors, taking into account all of the factors discussed above and the information provided by the Advisor and others in connection with its review and throughout the year, determined that the management fee is fair and reasonable in light of the services provided and that the investment management agreement between the Fund and the Advisor should be renewed.
33
Additional Information |
Retirement Account Information
As required by law, distributions you receive from certain retirement accounts are subject to federal income tax withholding, unless you elect not to have withholding apply*. Tax will be withheld on the total amount withdrawn even though you may be receiving amounts that are not subject to withholding, such as nondeductible contributions. In such case, excess amounts of withholding could occur. You may adjust your withholding election so that a greater or lesser amount will be withheld.
If you don’t want us to withhold on this amount, you must notify us to not withhold the federal income tax. You may notify us in writing or in certain situations by telephone or through other electronic means. For systematic withdrawals, your withholding election will remain in effect until revoked or changed by filing a new election. You have the right to revoke your election at any time and change your withholding percentage for future distributions.
Remember, even if you elect not to have income tax withheld, you are liable for paying income tax on the taxable portion of your withdrawal. If you elect not to have income tax withheld or you don’t have enough income tax withheld, you may be responsible for payment of estimated tax. You may incur penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. You can reduce or defer the income tax on a distribution by directly or indirectly rolling such distribution over to another IRA or eligible plan. You should consult your tax advisor for additional information.
State tax will be withheld if, at the time of your distribution, your address is within one of the mandatory withholding states and you have federal income tax withheld (or as otherwise required by state law). State taxes will be withheld from your distribution in accordance with the respective state rules.
*Some 403(b), 457 and qualified retirement plan distributions may be subject to 20% mandatory withholding, as they are subject to special tax and withholding rules. Your plan administrator or plan sponsor is required to provide you with a special tax notice explaining those rules at the time you request a distribution. If applicable, federal and/or state taxes may be withheld from your distribution amount.
Proxy Voting Policies
A description of the policies that the fund's investment advisor uses in exercising the voting rights associated with the securities purchased and/or held by the fund is available without charge, upon request, by calling 1-800-345-2021. It is also available on American Century Investments’ website at americancentury.com/proxy and on the Securities and Exchange Commission’s website at sec.gov. Information regarding how the investment advisor voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on americancentury.com/proxy. It is also available at sec.gov.
Quarterly Portfolio Disclosure
The fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. These portfolio holdings are available on the fund's website at americancentury.com and, upon request, by calling 1-800-345-2021. The fund’s Form N-PORT reports are available on the SEC’s website at sec.gov.
34
Other Tax Information
The following information is provided pursuant to provisions of the Internal Revenue Code.
The fund hereby designates up to the maximum amount allowable as qualified dividend income for the fiscal year ended November 30, 2021.
For the fiscal year ended November 30, 2021, the fund intends to pass through to shareholders foreign source income of $470,918 and foreign taxes paid of $47,239 or up to the maximum amount allowable, as a foreign tax credit. Foreign source income and foreign tax expense per outstanding share on November 30, 2021 are $0.1590 and $0.0160, respectively.
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Notes | ||||||||||||||
36
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Contact Us | americancentury.com | |||||||
Automated Information Line | 1-800-345-8765 | |||||||
Investor Services Representative | 1-800-345-2021 or 816-531-5575 | |||||||
Investors Using Advisors | 1-800-378-9878 | |||||||
Business, Not-For-Profit, Employer-Sponsored Retirement Plans | 1-800-345-3533 | |||||||
Banks and Trust Companies, Broker-Dealers, Financial Professionals, Insurance Companies | 1-800-345-6488 | |||||||
Telecommunications Relay Service for the Deaf | 711 | |||||||
American Century World Mutual Funds, Inc. | ||||||||
Investment Advisor: American Century Investment Management, Inc. Kansas City, Missouri | ||||||||
This report and the statements it contains are submitted for the general information of our shareholders. The report is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. | ||||||||
©2022 American Century Proprietary Holdings, Inc. All rights reserved. CL-ANN-91034 2201 |
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Annual Report | |||||
November 30, 2021 | |||||
Global Small Cap Fund | |||||
Investor Class (AGCVX) | |||||
I Class (AGCSX) | |||||
A Class (AGCLX) | |||||
C Class (AGCHX) | |||||
R Class (AGCWX) | |||||
R6 Class (AGCTX) |
Table of Contents |
President’s Letter | |||||
Performance | |||||
Portfolio Commentary | |||||
Fund Characteristics | |||||
Shareholder Fee Example | |||||
Schedule of Investments | |||||
Statement of Assets and Liabilities | |||||
Statement of Operations | |||||
Statement of Changes in Net Assets | |||||
Notes to Financial Statements | |||||
Financial Highlights | |||||
Report of Independent Registered Public Accounting Firm | |||||
Management | |||||
Approval of Management Agreement | |||||
Additional Information |
Any opinions expressed in this report reflect those of the author as of the date of the report, and do not necessarily represent the opinions of American Century Investments® or any other person in the American Century Investments organization. Any such opinions are subject to change at any time based upon market or other conditions and American Century Investments disclaims any responsibility to update such opinions. These opinions may not be relied upon as investment advice and, because investment decisions made by American Century Investments funds are based on numerous factors, may not be relied upon as an indication of trading intent on behalf of any American Century Investments fund. Security examples are used for representational purposes only and are not intended as recommendations to purchase or sell securities. Performance information for comparative indices and securities is provided to American Century Investments by third party vendors. To the best of American Century Investments’ knowledge, such information is accurate at the time of printing.
President’s Letter |
![image30a.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image30a.jpg)
Dear Investor:
Thank you for reviewing this annual report for the period ended November 30, 2021. Annual reports help convey important information about fund returns, including market factors that affected performance. For additional investment insights, please visit americancentury.com.
Global Stocks Advanced Despite Lingering and New Challenges
Global stocks broadly delivered solid gains for the 12-month period, even as pandemic-related challenges persisted. Improving economic data, along with central bank and government support and positive vaccine developments, helped boost corporate earnings and promote investor optimism. The U.S. generally outpaced other nations. Virus outbreaks and slower vaccine rollouts, particularly in emerging markets, led to lingering lockdowns in some regions.
As the period progressed, steady economic gains combined with ongoing monetary and fiscal support, rising energy prices and severe supply chain disruptions pushed global interest rates and inflation higher. In the U.S., year-over-year headline inflation climbed to 6.8% in November 2021, the largest 12-month increase in nearly 40 years. Similarly, inflation in the eurozone hit a 30-year high, while prices in the U.K. climbed to their highest level in 10 years.
Late in the period, the Federal Reserve began tapering its bond buying while adopting a more hawkish rate-tightening outlook amid surging inflation. However, central banks in Europe and the U.K. maintained their supportive programs, expressing concerns about slowing global growth outlooks. Meanwhile, the emergence of a new COVID-19 variant in late November triggered a steep sell-off among global stocks to end the reporting period.
Despite mounting inflation worries and late-period volatility, global stocks delivered solid performance for the full 12 months, highlighted by strong gains in developed markets. Emerging markets stocks generally delivered more modest returns.
Several Factors Shaping Market Dynamics
The return to pre-pandemic life is progressing, albeit somewhat cautiously due to COVID-19’s lingering effects. As the economy and markets respond to this fluid backdrop, investors will face opportunities and ongoing challenges. Economic growth, inflation, the virus’s trajectory, supply chain normalization and fiscal and monetary policy likely will sway market dynamics.
We appreciate your confidence in us during these extraordinary times. Our firm has a long history of helping clients weather unpredictable markets, and we’re confident we will continue to meet today’s challenges.
Sincerely,
![image23.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image23.jpg)
Jonathan Thomas
President and Chief Executive Officer
American Century Investments
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Performance |
Total Returns as of November 30, 2021 | ||||||||||||||||||||
Average Annual Returns | ||||||||||||||||||||
Ticker Symbol | 1 year | 5 years | Since Inception | Inception Date | ||||||||||||||||
Investor Class | AGCVX | 25.57% | 22.47% | 21.29% | 3/29/16 | |||||||||||||||
MSCI ACWI Small Cap Index | — | 20.18% | 11.91% | 12.25% | — | |||||||||||||||
I Class | AGCSX | 25.84% | 22.73% | 21.54% | 3/29/16 | |||||||||||||||
A Class | AGCLX | 3/29/16 | ||||||||||||||||||
No sales charge | 25.25% | 22.17% | 20.98% | |||||||||||||||||
With sales charge | 18.06% | 20.73% | 19.73% | |||||||||||||||||
C Class | AGCHX | 24.32% | 21.25% | 20.08% | 3/29/16 | |||||||||||||||
R Class | AGCWX | 24.97% | 21.87% | 20.69% | 3/29/16 | |||||||||||||||
R6 Class | AGCTX | 26.03% | 22.90% | 21.72% | 3/29/16 |
Sales charges include initial sales charges and contingent deferred sales charges (CDSCs), as applicable. A Class shares have a 5.75% maximum initial sales charge and may be subject to a maximum CDSC of 1.00%. C Class shares redeemed within 12 months of purchase are subject to a maximum CDSC of 1.00%. The SEC requires that mutual funds provide performance information net of maximum sales charges in all cases where charges could be applied.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
3
Growth of $10,000 Over Life of Class | ||
$10,000 investment made March 29, 2016 | ||
Performance for other share classes will vary due to differences in fee structure. |
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Value on November 30, 2021 | |||||
Investor Class — $29,907 | |||||
MSCI ACWI Small Cap Index — $19,271 | |||||
Total Annual Fund Operating Expenses | |||||||||||||||||
Investor Class | I Class | A Class | C Class | R Class | R6 Class | ||||||||||||
1.12% | 0.92% | 1.37% | 2.12% | 1.62% | 0.77% |
The total annual fund operating expenses shown is as stated in the fund’s prospectus current as of the date of this report. The prospectus may vary from the expense ratio shown elsewhere in this report because it is based on a different time period, includes acquired fund fees and expenses, and, if applicable, does not include fee waivers or expense reimbursements.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
4
Portfolio Commentary |
Portfolio Managers: Trevor Gurwich and Federico Laffan
Performance Summary
Global Small Cap returned 25.57%* for the 12-month period ended November 30, 2021, outperforming its benchmark, the MSCI ACWI Small Cap Index, which returned 20.18%.
Stocks rose strongly in late 2020, as progress toward COVID-19 vaccines raised hopes for easing lockdown measures and a global economic resurgence. Market leadership shifted away from the defensive, stay-at-home stocks that outperformed through much of 2020 toward more cyclically oriented names expected to benefit from a move toward normal. This market broadening continued through the first half of 2021 as the distribution of vaccines and the lifting of COVID-19 restrictions in many countries led to improved economic growth and robust corporate earnings. The market faced some headwinds in the second quarter of 2021, however, as companies reported challenges with supply chain bottlenecks, worker shortages and increased commodity prices. These pressures escalated in the third quarter, leading to increased market turbulence, as inflation fears and expectations for less accommodative monetary policy drove interest rates higher. New virus variants and vaccine rollout delays also complicated reopening plans in some countries. Developments in China, including regulatory uncertainty and a liquidity crisis in the property sector, also contributed to market volatility. Nonetheless, global small-cap stocks ended the 12-month period with strong performance, with the MSCI ACWI Small Cap Index outperforming the broader MSCI ACWI Index.
Against this backdrop, the fund delivered very strong returns for the 12 months, driven by stock selection across most sectors, notably consumer discretionary. An underweight in the energy sector hindered relative performance. From a geographic standpoint, stock selection in the U.S. was a strong contributor to relative outperformance, while stock selection in China detracted.
Top Contributors Included Materials Supplier and Footwear Company
The resurgence in the global economy fueled increased demand and stronger prices for raw materials. This benefited Capstone Mining, a top contributor. This global supplier of copper and other base models delivered strong financial performance, assisted by robust production, healthy pricing and reduced costs. The stock rose further in the third quarter of 2021 on news of its planned merger with Mantos Copper, a deal expected to increase its copper production capacity and market footprint.
Improved consumer spending trends and the expansion of e-commerce supported strong stock performance by consumer discretionary holdings, including Crocs. This U.S.-based footwear company reported strong revenue and earnings growth, aided by its brand popularity, favorable product mix, improved pricing and reduced expenses. Investors also responded positively to its commitment to reaching net-zero emissions by 2030 through sustainable ingredients and packaging. D'ieteren Group, another contributor, owns high-end automobile dealerships and repair services in Europe. It benefited from improved revenue trends as lockdown measures in Europe eased. It also expanded its addressable market through its acquisition of TVH Parts, a global distributor of forklift trucks and spare parts.
Several China-Based Holdings Detracted
China-based data center company Vnet Group was a prominent detractor, as increased Chinese regulation of internet companies impacted its key customers. While Vnet reported relatively strong revenue and earnings performance, aided by its retail business, it faced uncertainty due to its lower planned capital expenditures and the potential for decelerating growth in its wholesale business.
*All fund returns referenced in this commentary are for Investor Class shares. Performance for other share classes will vary due to differences in fee structure; when Investor Class performance exceeds that of the fund’s benchmark, other share classes may not. See page 3 for returns for all share classes.
5
Economic uncertainty and a sell-off in China-based equities also weighed on stock performance for automotive retailer China Yongda Automobiles Services Holdings. Despite the recent stock decline, we believe the company remains well positioned for long-term growth.
Optimism over reopening also led to a sell-off in companies viewed as beneficiaries of the stay-at-home period. These included Stillfront Group, the owner of a digital gaming studio that experienced strong business trends during the pandemic. We liquidated our holdings in the company as we sought investors with more attractive earnings growth potential.
Outlook
Despite near-term economic uncertainty, we believe the portfolio remains well positioned, supported by a broad array of stocks with strong company-specific drivers. While we have exposure to companies positioned to benefit from improved global economic growth, we remain balanced between reopening names and beneficiaries of long-term changes in behavior.
We hold a notable overweight in consumer discretionary, with a focus on companies we believe have sustainable earnings growth potential. Many consumer-facing companies saw strong revenue growth during the pandemic. As valuations increased, we sought opportunities in other investments we believe could deliver accelerating and sustainable earnings growth.
Information technology is also a prominent weighting in the portfolio. Opportunities in information technology include companies capitalizing on long-term secular trends such as digitalization, cloud computing, automation and software as a service. We believe supply chain disruptions and ongoing uncertainty over virus variants have helped accelerate many of these trends. The fund is underweight in financials and health care, sectors where we have found fewer compelling investments.
From a regional standpoint, stock selection led to overweights in North America and Europe. The fund remains underweight in Asia, especially in Japan. It is also underweight in the emerging markets, where we have found fewer companies in the region that we believe offer the potential for accelerating earnings growth.
6
Fund Characteristics |
NOVEMBER 30, 2021 | |||||
Types of Investments in Portfolio | % of net assets | ||||
Common Stocks | 92.4% | ||||
Exchange-Traded Funds | 5.7% | ||||
Temporary Cash Investments | 1.7% | ||||
Temporary Cash Investments - Securities Lending Collateral | 3.5% | ||||
Other Assets and Liabilities | (3.3)% | ||||
Top Five Countries* | % of net assets | ||||
United States | 52.2% | ||||
Canada | 8.7% | ||||
Japan | 6.5% | ||||
Israel | 3.3% | ||||
Sweden | 3.2% |
*Exposure indicated excludes Exchange-Traded Funds. The Schedule of Investments provides additional information on the fund's portfolio holdings.
7
Shareholder Fee Example |
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption/exchange fees; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in your fund and to compare these costs with the ongoing cost of investing in other mutual funds.
The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period from May 29, 2021 to November 30, 2021.
Actual Expenses
The table provides information about actual account values and actual expenses for each class. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. First, identify the share class you own. Then simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
If you hold Investor Class shares of any American Century Investments fund, or I Class shares of the American Century Diversified Bond Fund, in an American Century Investments account (i.e., not through a financial intermediary or employer-sponsored retirement plan account), American Century Investments may charge you a $25.00 annual account maintenance fee if the value of those shares is less than $10,000. We will redeem shares automatically in one of your accounts to pay the $25.00 fee. In determining your total eligible investment amount, we will include your investments in all personal accounts (including American Century Investments brokerage accounts) registered under your Social Security number. Personal accounts include individual accounts, joint accounts, UGMA/UTMA accounts, personal trusts, Coverdell Education Savings Accounts and IRAs (including traditional, Roth, Rollover, SEP-, SARSEP- and SIMPLE-IRAs), and certain other retirement accounts. If you have only business, business retirement, employer-sponsored or American Century Investments brokerage accounts, you are currently not subject to this fee. If you are subject to the account maintenance fee, your account value could be reduced by the fee amount.
Hypothetical Example for Comparison Purposes
The table also provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each class of your fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of a fund’s share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption/exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
8
Beginning Account Value 5/29/21 | Ending Account Value 11/30/21 | Expenses Paid During Period(1) 5/29/21 - 11/30/21 | Annualized Expense Ratio(1) | |||||||||||
Actual | ||||||||||||||
Investor Class | $1,000 | $1,028.90 | $5.69 | 1.10% | ||||||||||
I Class | $1,000 | $1,030.20 | $4.66 | 0.90% | ||||||||||
A Class | $1,000 | $1,027.60 | $6.97 | 1.35% | ||||||||||
C Class | $1,000 | $1,024.10 | $10.83 | 2.10% | ||||||||||
R Class | $1,000 | $1,026.30 | $8.26 | 1.60% | ||||||||||
R6 Class | $1,000 | $1,031.10 | $3.88 | 0.75% | ||||||||||
Hypothetical | ||||||||||||||
Investor Class | $1,000 | $1,019.87 | $5.66 | 1.10% | ||||||||||
I Class | $1,000 | $1,020.89 | $4.63 | 0.90% | ||||||||||
A Class | $1,000 | $1,018.60 | $6.94 | 1.35% | ||||||||||
C Class | $1,000 | $1,014.78 | $10.78 | 2.10% | ||||||||||
R Class | $1,000 | $1,017.33 | $8.22 | 1.60% | ||||||||||
R6 Class | $1,000 | $1,021.66 | $3.86 | 0.75% |
(1)Expenses are equal to the class's annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 186, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. Annualized expense ratio reflects actual expenses, including any applicable fee waivers or expense reimbursements and excluding any acquired fund fees and expenses.
9
Schedule of Investments |
NOVEMBER 30, 2021
Shares | Value | |||||||
COMMON STOCKS — 92.4% | ||||||||
Australia — 1.5% | ||||||||
Corporate Travel Management Ltd.(1) | 29,467 | $ | 460,688 | |||||
IDP Education Ltd. | 25,824 | 636,683 | ||||||
1,097,371 | ||||||||
Belgium — 2.0% | ||||||||
D'ieteren Group | 5,325 | 971,549 | ||||||
Melexis NV | 3,795 | 441,875 | ||||||
1,413,424 | ||||||||
Brazil — 0.4% | ||||||||
Locaweb Servicos de Internet SA | 46,100 | 108,324 | ||||||
Pet Center Comercio e Participacoes SA | 32,383 | 104,721 | ||||||
Santos Brasil Participacoes SA(1) | 75,700 | 79,849 | ||||||
292,894 | ||||||||
Canada — 8.7% | ||||||||
Boardwalk Real Estate Investment Trust | 16,686 | 694,896 | ||||||
BRP, Inc. | 4,087 | 323,006 | ||||||
Capstone Mining Corp.(1) | 119,917 | 588,578 | ||||||
Colliers International Group, Inc. (Toronto) | 6,176 | 833,780 | ||||||
Definity Financial Corp.(1) | 11,754 | 254,780 | ||||||
Kinaxis, Inc.(1) | 3,930 | 600,675 | ||||||
Savaria Corp.(2) | 23,395 | 339,905 | ||||||
Stantec, Inc. | 10,049 | 544,044 | ||||||
TFI International, Inc. | 5,061 | 502,515 | ||||||
Tricon Residential, Inc. (Toronto) | 65,543 | 899,937 | ||||||
Whitecap Resources, Inc.(2) | 121,193 | 645,123 | ||||||
6,227,239 | ||||||||
China — 0.9% | ||||||||
China Yongda Automobiles Services Holdings Ltd. | 278,500 | 421,384 | ||||||
Vnet Group, Inc., ADR(1) | 20,671 | 200,922 | ||||||
622,306 | ||||||||
Denmark — 0.9% | ||||||||
Pandora A/S | 5,196 | 646,499 | ||||||
Finland — 0.6% | ||||||||
Metso Outotec Oyj | 43,799 | 441,402 | ||||||
France — 2.7% | ||||||||
APERAM SA | 9,576 | 460,111 | ||||||
Euronext NV | 2,551 | 250,662 | ||||||
Nexans SA | 6,680 | 617,487 | ||||||
SOITEC(1) | 2,251 | 592,679 | ||||||
1,920,939 | ||||||||
India — 0.8% | ||||||||
WNS Holdings Ltd., ADR(1) | 7,163 | 602,193 | ||||||
Israel — 3.3% | ||||||||
Inmode Ltd.(1) | 7,072 | 537,472 | ||||||
Kornit Digital Ltd.(1) | 5,298 | 820,713 | ||||||
Nova Ltd.(1) | 7,831 | 1,006,675 | ||||||
2,364,860 |
10
Shares | Value | |||||||
Italy — 0.5% | ||||||||
Autogrill SpA(1) | 53,246 | $ | 344,147 | |||||
Japan — 6.5% | ||||||||
Appier Group, Inc.(1) | 22,400 | 313,258 | ||||||
Asics Corp. | 19,900 | 492,753 | ||||||
en Japan, Inc. | 9,600 | 298,594 | ||||||
Food & Life Cos. Ltd. | 14,200 | 601,334 | ||||||
JTOWER, Inc.(1) | 3,600 | 324,861 | ||||||
Nextage Co. Ltd. | 41,000 | 823,536 | ||||||
Nippon Gas Co. Ltd. | 16,900 | 210,575 | ||||||
Open House Co. Ltd. | 6,800 | 385,436 | ||||||
Relo Group, Inc. | 17,400 | 320,193 | ||||||
West Holdings Corp. | 14,700 | 841,079 | ||||||
4,611,619 | ||||||||
Netherlands — 0.5% | ||||||||
Basic-Fit NV(1)(2) | 8,656 | 375,685 | ||||||
Norway — 0.5% | ||||||||
Bakkafrost P/F | 5,029 | 330,282 | ||||||
South Korea — 0.6% | ||||||||
Ecopro BM Co. Ltd. | 982 | 448,932 | ||||||
Spain — 0.5% | ||||||||
CIE Automotive SA | 12,483 | 346,613 | ||||||
Sweden — 3.2% | ||||||||
BICO Group AB(1) | 8,008 | 259,790 | ||||||
Fortnox AB | 8,724 | 535,621 | ||||||
Instalco AB(2) | 11,471 | 506,671 | ||||||
Lifco AB, B Shares | 15,786 | 426,621 | ||||||
Nordic Entertainment Group AB, B Shares(1) | 11,225 | 557,442 | ||||||
2,286,145 | ||||||||
Switzerland — 1.8% | ||||||||
Comet Holding AG | 1,493 | 561,794 | ||||||
SIG Combibloc Group AG(1) | 26,192 | 690,424 | ||||||
1,252,218 | ||||||||
Taiwan — 1.2% | ||||||||
Airtac International Group | 3,464 | 106,014 | ||||||
ASPEED Technology, Inc. | 6,000 | 723,604 | ||||||
829,618 | ||||||||
United Kingdom — 3.1% | ||||||||
Electrocomponents plc | 52,714 | 849,145 | ||||||
Howden Joinery Group plc | 30,148 | 347,334 | ||||||
Pets at Home Group plc | 77,743 | 481,130 | ||||||
S4 Capital plc(1) | 65,216 | 503,711 | ||||||
2,181,320 | ||||||||
United States — 52.2% | ||||||||
Arko Corp.(1) | 35,737 | 337,000 | ||||||
Bancorp, Inc. (The)(1) | 9,953 | 281,371 | ||||||
Biohaven Pharmaceutical Holding Co. Ltd.(1) | 1,681 | 188,675 | ||||||
BRP Group, Inc., Class A(1) | 13,224 | 489,817 | ||||||
Brunswick Corp. | 4,060 | 381,275 | ||||||
Builders FirstSource, Inc.(1) | 7,556 | 524,689 | ||||||
Callaway Golf Co.(1) | 2,519 | 67,912 | ||||||
Capri Holdings Ltd.(1) | 8,349 | 494,428 |
11
Shares | Value | |||||||
Clean Harbors, Inc.(1) | 6,964 | $ | 706,428 | |||||
Codexis, Inc.(1) | 22,056 | 765,564 | ||||||
Crocs, Inc.(1) | 5,546 | 909,655 | ||||||
Deckers Outdoor Corp.(1) | 799 | 323,915 | ||||||
DigitalBridge Group, Inc.(1) | 96,094 | 764,908 | ||||||
DigitalOcean Holdings, Inc.(1) | 5,469 | 551,330 | ||||||
Diversey Holdings Ltd.(1) | 25,108 | 330,923 | ||||||
Driven Brands Holdings, Inc.(1) | 14,311 | 441,637 | ||||||
Eagle Materials, Inc. | 3,836 | 591,588 | ||||||
Element Solutions, Inc. | 26,068 | 596,175 | ||||||
elf Beauty, Inc.(1) | 17,791 | 535,865 | ||||||
European Wax Center, Inc., Class A(1) | 15,666 | 422,512 | ||||||
Evoqua Water Technologies Corp.(1) | 11,470 | 515,921 | ||||||
First Advantage Corp.(1) | 28,915 | 501,386 | ||||||
Fox Factory Holding Corp.(1) | 3,304 | 580,744 | ||||||
Glacier Bancorp, Inc. | 12,209 | 662,949 | ||||||
Global Medical REIT, Inc. | 32,353 | 528,648 | ||||||
Goosehead Insurance, Inc., Class A | 2,080 | 273,146 | ||||||
H&E Equipment Services, Inc. | 9,825 | 413,632 | ||||||
Hannon Armstrong Sustainable Infrastructure Capital, Inc. | 7,073 | 402,312 | ||||||
Harmony Biosciences Holdings, Inc.(1) | 5,084 | 173,314 | ||||||
HireRight Holdings Corp.(1) | 24,275 | 450,544 | ||||||
John Bean Technologies Corp. | 2,640 | 416,513 | ||||||
Kinsale Capital Group, Inc. | 2,661 | 553,488 | ||||||
Korn Ferry | 7,541 | 548,532 | ||||||
Lattice Semiconductor Corp.(1) | 6,771 | 514,122 | ||||||
Live Oak Bancshares, Inc. | 8,519 | 759,043 | ||||||
Lovesac Co. (The)(1) | 8,367 | 529,464 | ||||||
MACOM Technology Solutions Holdings, Inc.(1) | 6,348 | 456,485 | ||||||
Manhattan Associates, Inc.(1) | 4,024 | 628,388 | ||||||
MAXIMUS, Inc. | 4,287 | 323,454 | ||||||
MGP Ingredients, Inc. | 5,016 | 391,148 | ||||||
Natera, Inc.(1) | 3,505 | 320,567 | ||||||
National Instruments Corp. | 12,595 | 522,944 | ||||||
NeoGenomics, Inc.(1) | 1,805 | 61,839 | ||||||
Newmark Group, Inc., Class A | 59,601 | 957,192 | ||||||
NOW, Inc.(1) | 58,075 | 485,507 | ||||||
Onto Innovation, Inc.(1) | 4,964 | 467,410 | ||||||
Open Lending Corp., Class A(1) | 2,859 | 66,443 | ||||||
OptimizeRx Corp.(1) | 6,343 | 412,295 | ||||||
Ortho Clinical Diagnostics Holdings plc(1) | 30,355 | 580,995 | ||||||
Paycor HCM, Inc.(1) | 19,126 | 563,069 | ||||||
Perficient, Inc.(1) | 4,917 | 673,777 | ||||||
Plymouth Industrial REIT, Inc. | 6,399 | 190,370 | ||||||
Power Integrations, Inc. | 3,768 | 376,913 | ||||||
Progyny, Inc.(1) | 5,889 | 298,985 | ||||||
Pure Storage, Inc., Class A(1) | 20,055 | 621,103 | ||||||
R1 RCM, Inc.(1) | 31,050 | 739,611 | ||||||
RadNet, Inc.(1) | 23,128 | 623,531 | ||||||
Revolve Group, Inc.(1) | 6,539 | 498,076 | ||||||
RH(1) | 705 | 411,142 | ||||||
Ryman Hospitality Properties, Inc.(1) | 8,771 | 678,875 |
12
Shares | Value | |||||||
SeaWorld Entertainment, Inc.(1) | 11,193 | $ | 660,275 | |||||
Semtech Corp.(1) | 6,281 | 538,093 | ||||||
Sensata Technologies Holding plc(1) | 6,067 | 337,932 | ||||||
SI-BONE, Inc.(1) | 3,470 | 66,797 | ||||||
Silk Road Medical, Inc.(1) | 1,459 | 59,206 | ||||||
Silvergate Capital Corp., Class A(1) | 2,833 | 579,292 | ||||||
Sovos Brands, Inc.(1) | 26,888 | 414,882 | ||||||
SP Plus Corp.(1) | 10,858 | 294,360 | ||||||
Sprout Social, Inc., Class A(1) | 4,635 | 517,637 | ||||||
SPS Commerce, Inc.(1) | 2,787 | 392,939 | ||||||
Sterling Check Corp.(1) | 12,845 | 305,326 | ||||||
Summit Materials, Inc., Class A(1) | 22,332 | 832,984 | ||||||
Tenable Holdings, Inc.(1) | 16,085 | 794,599 | ||||||
Travel + Leisure Co. | 6,588 | 324,261 | ||||||
Triumph Bancorp, Inc.(1) | 6,417 | 817,205 | ||||||
Wintrust Financial Corp. | 8,056 | 705,142 | ||||||
Wyndham Hotels & Resorts, Inc. | 7,846 | 623,600 | ||||||
37,144,074 | ||||||||
TOTAL COMMON STOCKS (Cost $51,848,500) | 65,779,780 | |||||||
EXCHANGE-TRADED FUNDS — 5.7% | ||||||||
Schwab International Small-Cap Equity ETF(2) | 50,878 | 2,055,471 | ||||||
Schwab US Small-Cap ETF(2) | 20,331 | 2,033,710 | ||||||
TOTAL EXCHANGE-TRADED FUNDS (Cost $4,342,043) | 4,089,181 | |||||||
TEMPORARY CASH INVESTMENTS — 1.7% | ||||||||
Repurchase Agreement, BMO Capital Markets Corp., (collateralized by various U.S. Treasury obligations, 0.125% - 2.625%, 6/30/22 - 5/15/51, valued at $277,939), in a joint trading account at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $272,110) | 272,110 | |||||||
Repurchase Agreement, Fixed Income Clearing Corp., (collateralized by various U.S. Treasury obligations, 1.00%, 7/31/28, valued at $925,188), at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $907,001) | 907,000 | |||||||
State Street Institutional U.S. Government Money Market Fund, Premier Class | 5,997 | 5,997 | ||||||
TOTAL TEMPORARY CASH INVESTMENTS (Cost $1,185,107) | 1,185,107 | |||||||
TEMPORARY CASH INVESTMENTS - SECURITIES LENDING COLLATERAL(3) — 3.5% | ||||||||
State Street Navigator Securities Lending Government Money Market Portfolio (Cost $2,516,633) | 2,516,633 | 2,516,633 | ||||||
TOTAL INVESTMENT SECURITIES — 103.3% (Cost $59,892,283) | 73,570,701 | |||||||
OTHER ASSETS AND LIABILITIES — (3.3)% | (2,356,009) | |||||||
TOTAL NET ASSETS — 100.0% | $ | 71,214,692 |
13
MARKET SECTOR DIVERSIFICATION | |||||
(as a % of net assets) | |||||
Consumer Discretionary | 19.6% | ||||
Information Technology | 18.9% | ||||
Industrials | 17.7% | ||||
Financials | 8.6% | ||||
Real Estate | 8.4% | ||||
Health Care | 7.2% | ||||
Materials | 5.7% | ||||
Consumer Staples | 2.4% | ||||
Communication Services | 1.5% | ||||
Utilities | 1.5% | ||||
Energy | 0.9% | ||||
Exchange-Traded Funds | 5.7% | ||||
Temporary Cash Investments | 1.7% | ||||
Temporary Cash Investments - Securities Lending Collateral | 3.5% | ||||
Other Assets and Liabilities | (3.3)% |
NOTES TO SCHEDULE OF INVESTMENTS | ||||||||
ADR | - | American Depositary Receipt |
(1)Non-income producing.
(2)Security, or a portion thereof, is on loan. At the period end, the aggregate value of securities on loan was $3,579,308. The amount of securities on loan indicated may not correspond with the securities on loan identified because securities with pending sales are in the process of recall from the brokers.
(3)Investment of cash collateral from securities on loan. At the period end, the aggregate value of the collateral held by the fund was $3,740,843, which includes securities collateral of $1,224,210.
See Notes to Financial Statements.
14
Statement of Assets and Liabilities |
NOVEMBER 30, 2021 | |||||
Assets | |||||
Investment securities, at value (cost of $57,375,650) — including $3,579,308 of securities on loan | $ | 71,054,068 | |||
Investment made with cash collateral received for securities on loan, at value (cost of $2,516,633) | 2,516,633 | ||||
Total investment securities, at value (cost of $59,892,283) | 73,570,701 | ||||
Receivable for capital shares sold | 235,374 | ||||
Dividends and interest receivable | 42,284 | ||||
Securities lending receivable | 1,122 | ||||
Other assets | 1,570 | ||||
73,851,051 | |||||
Liabilities | |||||
Disbursements in excess of demand deposit cash | 468 | ||||
Payable for collateral received for securities on loan | 2,516,633 | ||||
Payable for capital shares redeemed | 58,494 | ||||
Accrued management fees | 59,697 | ||||
Distribution and service fees payable | 1,067 | ||||
2,636,359 | |||||
Net Assets | $ | 71,214,692 | |||
Net Assets Consist of: | |||||
Capital (par value and paid-in surplus) | $ | 47,882,568 | |||
Distributable earnings | 23,332,124 | ||||
$ | 71,214,692 |
Net Assets | Shares Outstanding | Net Asset Value Per Share | |||||||||
Investor Class, $0.01 Par Value | $41,837,634 | 1,677,388 | $24.94 | ||||||||
I Class, $0.01 Par Value | $11,067,490 | 438,039 | $25.27 | ||||||||
A Class, $0.01 Par Value | $316,632 | 12,895 | $24.55* | ||||||||
C Class, $0.01 Par Value | $177,717 | 7,592 | $23.41 | ||||||||
R Class, $0.01 Par Value | $1,936,840 | 80,132 | $24.17 | ||||||||
R6 Class, $0.01 Par Value | $15,878,379 | 622,544 | $25.51 |
*Maximum offering price $26.05 (net asset value divided by 0.9425).
See Notes to Financial Statements.
15
Statement of Operations |
YEAR ENDED NOVEMBER 30, 2021 | |||||
Investment Income (Loss) | |||||
Income: | |||||
Dividends (net of foreign taxes withheld of $26,813) | $ | 408,512 | |||
Securities lending, net | 13,557 | ||||
Interest | 186 | ||||
422,255 | |||||
Expenses: | |||||
Management fees | 573,377 | ||||
Distribution and service fees: | |||||
A Class | 465 | ||||
C Class | 853 | ||||
R Class | 7,184 | ||||
Directors' fees and expenses | 1,478 | ||||
Other expenses | 3,126 | ||||
586,483 | |||||
Net investment income (loss) | (164,228) | ||||
Realized and Unrealized Gain (Loss) | |||||
Net realized gain (loss) on: | |||||
Investment transactions | 12,828,889 | ||||
Foreign currency translation transactions | (9,832) | ||||
12,819,057 | |||||
Change in net unrealized appreciation (depreciation) on: | |||||
Investments | (708,784) | ||||
Translation of assets and liabilities in foreign currencies | (493) | ||||
(709,277) | |||||
Net realized and unrealized gain (loss) | 12,109,780 | ||||
Net Increase (Decrease) in Net Assets Resulting from Operations | $ | 11,945,552 |
See Notes to Financial Statements.
16
Statement of Changes in Net Assets |
YEARS ENDED NOVEMBER 30, 2021 AND NOVEMBER 30, 2020 | ||||||||
Increase (Decrease) in Net Assets | November 30, 2021 | November 30, 2020 | ||||||
Operations | ||||||||
Net investment income (loss) | $ | (164,228) | $ | (158,271) | ||||
Net realized gain (loss) | 12,819,057 | 1,906,839 | ||||||
Change in net unrealized appreciation (depreciation) | (709,277) | 11,333,298 | ||||||
Net increase (decrease) in net assets resulting from operations | 11,945,552 | 13,081,866 | ||||||
Distributions to Shareholders | ||||||||
From earnings: | ||||||||
Investor Class | (1,491,067) | (752,595) | ||||||
I Class | (85,407) | (27,255) | ||||||
A Class | (4,280) | (33,528) | ||||||
C Class | (3,236) | (30,545) | ||||||
R Class | (60,372) | (27,101) | ||||||
R6 Class | (1,339,898) | (10,074) | ||||||
Decrease in net assets from distributions | (2,984,260) | (881,098) | ||||||
Capital Share Transactions | ||||||||
Net increase (decrease) in net assets from capital share transactions (Note 5) | 14,414,232 | 18,080,718 | ||||||
Net increase (decrease) in net assets | 23,375,524 | 30,281,486 | ||||||
Net Assets | ||||||||
Beginning of period | 47,839,168 | 17,557,682 | ||||||
End of period | $ | 71,214,692 | $ | 47,839,168 |
See Notes to Financial Statements.
17
Notes to Financial Statements |
NOVEMBER 30, 2021
1. Organization
American Century World Mutual Funds, Inc. (the corporation) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company and is organized as a Maryland corporation. Global Small Cap Fund (the fund) is one fund in a series issued by the corporation. The fund’s investment objective is to seek capital growth.
The fund offers the Investor Class, I Class, A Class, C Class, R Class and R6 Class. The A Class may incur an initial sales charge. The A Class and C Class may be subject to a contingent deferred sales charge.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently followed by the fund in preparation of its financial statements. The fund is an investment company and follows accounting and reporting guidance in accordance with accounting principles generally accepted in the United States of America. This may require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from these estimates. Management evaluated the impact of events or transactions occurring through the date the financial statements were issued that would merit recognition or disclosure.
Investment Valuations — The fund determines the fair value of its investments and computes its net asset value (NAV) per share at the close of regular trading (usually 4 p.m. Eastern time) on the New York Stock Exchange (NYSE) on each day the NYSE is open. The Board of Directors has adopted valuation policies and procedures to guide the investment advisor in the fund’s investment valuation process and to provide methodologies for the oversight of the fund’s pricing function.
Equity securities that are listed or traded on a domestic securities exchange are valued at the last reported sales price or at the official closing price as provided by the exchange. Equity securities traded on foreign securities exchanges are generally valued at the closing price of such securities on the exchange where primarily traded or at the close of the NYSE, if that is earlier. If no last sales price is reported, or if local convention or regulation so provides, the mean of the latest bid and asked prices may be used. Securities traded over-the-counter are valued at the mean of the latest bid and asked prices, the last sales price, or the official closing price. Equity securities initially expressed in local currencies are translated into U.S. dollars at the mean of the appropriate currency exchange rate at the close of the NYSE as provided by an independent pricing service.
Open-end management investment companies are valued at the reported NAV per share. Repurchase agreements are valued at cost, which approximates fair value.
If the fund determines that the market price for an investment is not readily available or the valuation methods mentioned above do not reflect an investment’s fair value, such investment is valued as determined in good faith by the Board of Directors or its delegate, in accordance with policies and procedures adopted by the Board of Directors. In its determination of fair value, the fund may review several factors including, but not limited to, market information regarding the specific investment or comparable investments and correlation with other investment types, futures indices or general market indicators. Circumstances that may cause the fund to use these procedures to value an investment include, but are not limited to: an investment has been declared in default or is distressed; trading in a security has been suspended during the trading day or a security is not actively trading on its principal exchange; prices received from a regular pricing source are deemed unreliable; or there is a foreign market holiday and no trading occurred.
18
The fund monitors for significant events occurring after the close of an investment’s primary exchange but before the fund’s NAV per share is determined. Significant events may include, but are not limited to: corporate announcements and transactions; governmental action and political unrest that could impact a specific investment or an investment sector; or armed conflicts, natural disasters and similar events that could affect investments in a specific country or region. The fund also monitors for significant fluctuations between domestic and foreign markets, as evidenced by the U.S. market or such other indicators that the Board of Directors, or its delegate, deems appropriate. The fund may apply a model-derived factor to the closing price of equity securities traded on foreign securities exchanges. The factor is based on observable market data as provided by an independent pricing service.
Security Transactions — Security transactions are accounted for as of the trade date. Net realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes.
Investment Income — Dividend income less foreign taxes withheld, if any, is recorded as of the ex-dividend date. Distributions received on securities that represent a return of capital or long-term capital gain are recorded as a reduction of cost of investments and/or as a realized gain. The fund may estimate the components of distributions received that may be considered nontaxable distributions or long-term capital gain distributions for income tax purposes. Interest income is recorded on the accrual basis and includes accretion of discounts and amortization of premiums. Securities lending income is net of fees and rebates earned by the lending agent for its services.
Foreign Currency Translations — All assets and liabilities initially expressed in foreign currencies are translated into U.S. dollars at prevailing exchange rates at period end. The fund may enter into spot foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of investment securities, dividend and interest income, spot foreign currency exchange contracts, and expenses are translated at the rates of exchange prevailing on the respective dates of such transactions. Net realized and unrealized foreign currency exchange gains or losses related to investment securities are a component of net realized gain (loss) on investment transactions and change in net unrealized appreciation (depreciation) on investments, respectively.
Repurchase Agreements — The fund may enter into repurchase agreements with institutions that American Century Investment Management, Inc. (ACIM) (the investment advisor) has determined are creditworthy pursuant to criteria adopted by the Board of Directors. The fund requires that the collateral, represented by securities, received in a repurchase transaction be transferred to the custodian in a manner sufficient to enable the fund to obtain those securities in the event of a default under the repurchase agreement. ACIM monitors, on a daily basis, the securities transferred to ensure the value, including accrued interest, of the securities under each repurchase agreement is equal to or greater than amounts owed to the fund under each repurchase agreement.
Joint Trading Account — Pursuant to an Exemptive Order issued by the Securities and Exchange Commission, the fund, along with certain other funds in the American Century Investments family of funds, may transfer uninvested cash balances into a joint trading account. These balances are invested in one or more repurchase agreements that are collateralized by U.S. Treasury or Agency obligations.
Segregated Assets — In accordance with the 1940 Act, the fund segregates assets on its books and records to cover certain types of investment securities and other financial instruments. ACIM monitors, on a daily basis, the securities segregated to ensure the fund designates a sufficient amount of liquid assets, marked-to-market daily. The fund may also receive assets or be required to pledge assets at the custodian bank or with a broker for collateral requirements.
Income Tax Status — It is the fund’s policy to distribute substantially all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code. Accordingly, no provision has been made for income taxes. The fund files U.S. federal, state, local and non-U.S. tax returns as applicable. The fund's tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years from the date of filing but can be longer in certain jurisdictions. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
19
Multiple Class — All shares of the fund represent an equal pro rata interest in the net assets of the class to which such shares belong, and have identical voting, dividend, liquidation and other rights and the same terms and conditions, except for class specific expenses and exclusive rights to vote on matters affecting only individual classes. Income, non-class specific expenses, and realized and unrealized capital gains and losses of the fund are allocated to each class of shares based on their relative net assets.
Distributions to Shareholders — Distributions from net investment income and net realized gains, if any, are generally declared and paid annually. The fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code, in all events in a manner consistent with provisions of the 1940 Act. The fund may elect to treat a portion of its payment to a redeeming shareholder, which represents the pro rata share of undistributed net investment income and net realized gains, as a distribution for federal income tax purposes (tax equalization).
Indemnifications — Under the corporation’s organizational documents, its officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business, the fund enters into contracts that provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against a fund. The risk of material loss from such claims is considered by management to be remote.
Securities Lending — Securities are lent to qualified financial institutions and brokers. State Street Bank & Trust Co. serves as securities lending agent to the fund pursuant to a Securities Lending Agreement. The lending of securities exposes the fund to risks such as: the borrowers may fail to return the loaned securities, the borrowers may not be able to provide additional collateral, the fund may experience delays in recovery of the loaned securities or delays in access to collateral, or the fund may experience losses related to the investment collateral. To minimize certain risks, loan counterparties pledge collateral in the form of cash and/or securities. The lending agent has agreed to indemnify the fund in the case of default of any securities borrowed. Cash collateral received is invested in the State Street Navigator Securities Lending Government Money Market Portfolio, a money market mutual fund registered under the 1940 Act. The loans may also be secured by U.S. government securities in an amount at least equal to the market value of the securities loaned, plus accrued interest and dividends, determined on a daily basis and adjusted accordingly. By lending securities, the fund seeks to increase its net investment income through the receipt of interest and fees. Such income is reflected separately within the Statement of Operations. The value of loaned securities and related collateral outstanding at period end, if any, are shown on a gross basis within the Schedule of Investments and Statement of Assets and Liabilities.
The following table reflects a breakdown of transactions accounted for as secured borrowings, the gross obligation by the type of collateral pledged, and the remaining contractual maturity of those transactions as of November 30, 2021.
Remaining Contractual Maturity of Agreements | |||||||||||||||||
Overnight and Continuous | <30 days | Between 30 & 90 days | >90 days | Total | |||||||||||||
Securities Lending Transactions(1) | |||||||||||||||||
Common Stocks | $ | 396,834 | — | — | — | $ | 396,834 | ||||||||||
Exchange-Traded Funds | 2,119,799 | — | — | — | 2,119,799 | ||||||||||||
Total Borrowings | $ | 2,516,633 | — | — | — | $ | 2,516,633 | ||||||||||
Gross amount of recognized liabilities for securities lending transactions | $ | 2,516,633 |
(1)Amount represents the payable for cash collateral received for securities on loan. This will generally be in the Overnight and Continuous column as the securities are typically callable on demand.
3. Fees and Transactions with Related Parties
Certain officers and directors of the corporation are also officers and/or directors of American Century Companies, Inc. (ACC). The corporation’s investment advisor, ACIM, the corporation's distributor, American Century Investment Services, Inc. (ACIS), and the corporation’s transfer agent, American Century Services, LLC, are wholly owned, directly or indirectly, by ACC.
20
Management Fees — The corporation has entered into a management agreement with ACIM, under which ACIM provides the fund with investment advisory and management services in exchange for a single, unified management fee (the fee) per class. The agreement provides that ACIM will pay all expenses of managing and operating the fund, except brokerage expenses, taxes, interest, fees and expenses of the independent directors (including legal counsel fees), extraordinary expenses, and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the 1940 Act. The fee is computed and accrued daily based on each class's daily net assets and paid monthly in arrears. The difference in the fee among the classes is a result of their separate arrangements for non-Rule 12b-1 shareholder services. It is not the result of any difference in advisory or custodial fees or other expenses related to the management of the fund’s assets, which do not vary by class.
The annual management fee for each class is as follows:
Investor Class | I Class | A Class | C Class | R Class | R6 Class | ||||||||||||
1.10% | 0.90% | 1.10% | 1.10% | 1.10% | 0.75% |
Distribution and Service Fees — The Board of Directors has adopted a separate Master Distribution and Individual Shareholder Services Plan for each of the A Class, C Class and R Class (collectively the plans), pursuant to Rule 12b-1 of the 1940 Act. The plans provide that the A Class will pay ACIS an annual distribution and service fee of 0.25%. The plans provide that the C Class will pay ACIS an annual distribution and service fee of 1.00%, of which 0.25% is paid for individual shareholder services and 0.75% is paid for distribution services. The plans provide that the R Class will pay ACIS an annual distribution and service fee of 0.50%. The fees are computed and accrued daily based on each class’s daily net assets and paid monthly in arrears. The fees are used to pay financial intermediaries for distribution and individual shareholder services. Fees incurred under the plans during the period ended November 30, 2021 are detailed in the Statement of Operations.
Directors' Fees and Expenses — The Board of Directors is responsible for overseeing the investment advisor’s management and operations of the fund. The directors receive detailed information about the fund and its investment advisor regularly throughout the year, and meet at least quarterly with management of the investment advisor to review reports about fund operations. The fund’s officers do not receive compensation from the fund.
Interfund Transactions — The fund may enter into security transactions with other American Century Investments funds and other client accounts of the investment advisor, in accordance with the 1940 Act rules and procedures adopted by the Board of Directors. The rules and procedures require, among other things, that these transactions be effected at the independent current market price of the security. During the period, the interfund purchases and sales were $231,065 and $77,216, respectively. The effect of interfund transactions on the Statement of Operations was $425 in net realized gain (loss) on investment transactions.
4. Investment Transactions
Purchases and sales of investment securities, excluding short-term investments, for the period ended November 30, 2021 were $90,006,551 and $79,674,145, respectively.
21
5. Capital Share Transactions
Transactions in shares of the fund were as follows:
Year ended November 30, 2021 | Year ended November 30, 2020 | |||||||||||||
Shares | Amount | Shares | Amount | |||||||||||
Investor Class/Shares Authorized | 40,000,000 | 40,000,000 | ||||||||||||
Sold | 809,165 | $ | 19,787,083 | 507,419 | $ | 8,327,857 | ||||||||
Issued in reinvestment of distributions | 66,964 | 1,466,380 | 47,962 | 739,577 | ||||||||||
Redeemed | (220,131) | (5,285,238) | (482,942) | (7,711,302) | ||||||||||
655,998 | 15,968,225 | 72,439 | 1,356,132 | |||||||||||
I Class/Shares Authorized | 25,000,000 | 25,000,000 | ||||||||||||
Sold | 505,427 | 12,351,326 | 21,302 | 404,684 | ||||||||||
Issued in reinvestment of distributions | 3,813 | 85,407 | 1,753 | 27,255 | ||||||||||
Redeemed | (98,729) | (2,406,901) | (30,455) | (549,600) | ||||||||||
410,511 | 10,029,832 | (7,400) | (117,661) | |||||||||||
A Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 10,731 | 257,844 | 2,004 | 32,714 | ||||||||||
Issued in reinvestment of distributions | 198 | 4,280 | 2,196 | 33,528 | ||||||||||
Redeemed | (1,036) | (24,970) | (44,016) | (783,257) | ||||||||||
9,893 | 237,154 | (39,816) | (717,015) | |||||||||||
C Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 5,182 | 120,261 | 1,400 | 20,980 | ||||||||||
Issued in reinvestment of distributions | 156 | 3,236 | 2,062 | 30,545 | ||||||||||
Redeemed | — | — | (40,331) | (711,043) | ||||||||||
5,338 | 123,497 | (36,869) | (659,518) | |||||||||||
R Class/Shares Authorized | 20,000,000 | 20,000,000 | ||||||||||||
Sold | 51,432 | 1,211,805 | 25,240 | 399,452 | ||||||||||
Issued in reinvestment of distributions | 2,528 | 53,905 | 1,794 | 27,101 | ||||||||||
Redeemed | (14,582) | (342,974) | (20,014) | (329,670) | ||||||||||
39,378 | 922,736 | 7,020 | 96,883 | |||||||||||
R6 Class/Shares Authorized | 20,000,000 | 20,000,000 | ||||||||||||
Sold | 93,864 | 2,263,711 | 2,037,224 | 31,243,617 | ||||||||||
Issued in reinvestment of distributions | 60,208 | 1,339,898 | 644 | 10,074 | ||||||||||
Redeemed | (683,052) | (16,470,821) | (899,244) | (13,131,794) | ||||||||||
(528,980) | (12,867,212) | 1,138,624 | 18,121,897 | |||||||||||
Net increase (decrease) | 592,138 | $ | 14,414,232 | 1,133,998 | $ | 18,080,718 |
6. Fair Value Measurements
The fund’s investments valuation process is based on several considerations and may use multiple inputs to determine the fair value of the investments held by the fund. In conformity with accounting principles generally accepted in the United States of America, the inputs used to determine a valuation are classified into three broad levels.
•Level 1 valuation inputs consist of unadjusted quoted prices in an active market for identical investments.
•Level 2 valuation inputs consist of direct or indirect observable market data (including quoted prices for comparable investments, evaluations of subsequent market events, interest rates, prepayment speeds, credit risk, etc.). These inputs also consist of quoted prices for identical investments initially expressed in local currencies that are adjusted through translation into U.S. dollars.
•Level 3 valuation inputs consist of unobservable data (including a fund’s own assumptions).
22
The level classification is based on the lowest level input that is significant to the fair valuation measurement. The valuation inputs are not necessarily an indication of the risks associated with investing in these securities or other financial instruments.
The following is a summary of the level classifications as of period end. The Schedule of Investments provides additional information on the fund’s portfolio holdings.
Level 1 | Level 2 | Level 3 | |||||||||
Assets | |||||||||||
Investment Securities | |||||||||||
Common Stocks | |||||||||||
Australia | — | $ | 1,097,371 | — | |||||||
Belgium | — | 1,413,424 | — | ||||||||
Brazil | — | 292,894 | — | ||||||||
Canada | — | 6,227,239 | — | ||||||||
China | $ | 200,922 | 421,384 | — | |||||||
Denmark | — | 646,499 | — | ||||||||
Finland | — | 441,402 | — | ||||||||
France | — | 1,920,939 | — | ||||||||
Italy | — | 344,147 | — | ||||||||
Japan | — | 4,611,619 | — | ||||||||
Netherlands | — | 375,685 | — | ||||||||
Norway | — | 330,282 | — | ||||||||
South Korea | — | 448,932 | — | ||||||||
Spain | — | 346,613 | — | ||||||||
Sweden | — | 2,286,145 | — | ||||||||
Switzerland | — | 1,252,218 | — | ||||||||
Taiwan | — | 829,618 | — | ||||||||
United Kingdom | — | 2,181,320 | — | ||||||||
Other Countries | 40,111,127 | — | — | ||||||||
Exchange-Traded Funds | 4,089,181 | — | — | ||||||||
Temporary Cash Investments | 5,997 | 1,179,110 | — | ||||||||
Temporary Cash Investments - Securities Lending Collateral | 2,516,633 | — | — | ||||||||
$ | 46,923,860 | $ | 26,646,841 | — |
7. Risk Factors
The value of the fund’s shares will go up and down, sometimes rapidly or unpredictably, based on the performance of the securities owned by the fund and other factors generally affecting the securities market. Market risks, including political, regulatory, economic and social developments, can affect the value of the fund’s investments. Natural disasters, public health emergencies, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse long-term effects on world economies and markets generally.
There are certain risks involved in investing in foreign securities. These risks include those resulting from political events (such as civil unrest, national elections and imposition of exchange controls), social and economic events (such as labor strikes and rising inflation), and natural disasters. Securities of foreign issuers may be less liquid and more volatile. Investing in emerging markets or a significant portion of assets in one country or region may accentuate these risks.
The fund invests in common stocks of small companies. Because of this, the fund may be subject to greater risk and market fluctuations than a fund investing in larger, more established companies.
The fund’s investment process may result in high portfolio turnover, which could mean high transaction costs, affecting both performance and capital gains tax liabilities to investors.
23
8. Federal Tax Information
On December 21, 2021, the fund declared and paid a per-share distribution from net realized gains to shareholders of record on December 20, 2021 of $3.5284 for the Investor Class, I Class, A Class, C Class, R Class and R6 Class.
On December 21, 2021, the fund declared and paid the following per-share distributions from net investment income to shareholders of record on December 20, 2021:
Investor Class | I Class | A Class | C Class | R Class | R6 Class | ||||||||||||
$0.0433 | $0.0909 | — | — | — | $0.1265 |
The tax character of distributions paid during the years ended November 30, 2021 and November 30, 2020 were as follows:
2021 | 2020 | |||||||
Distributions Paid From | ||||||||
Ordinary income | $ | 685,713 | — | |||||
Long-term capital gains | $ | 2,298,547 | $ | 881,098 |
The book-basis character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements.
The reclassifications, which are primarily due to tax equalization, were made to capital $1,575,426 and distributable earnings $(1,575,426).
As of period end, the federal tax cost of investments and the components of distributable earnings on a tax-basis were as follows:
Federal tax cost of investments | $ | 60,812,492 | |||
Gross tax appreciation of investments | $ | 14,567,834 | |||
Gross tax depreciation of investments | (1,809,625) | ||||
Net tax appreciation (depreciation) of investments | 12,758,209 | ||||
Net tax appreciation (depreciation) on translation of assets and liabilities in foreign currencies | (309) | ||||
Net tax appreciation (depreciation) | $ | 12,757,900 | |||
Undistributed ordinary income | $ | 4,915,889 | |||
Accumulated long-term gains | $ | 5,658,335 |
The difference between book-basis and tax-basis unrealized appreciation (depreciation) is attributable primarily to the tax deferral of losses on wash sales.
24
Financial Highlights |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Ratio to Average Net Assets of: | ||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Distributions From Net Realized Gains | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Net Investment Income (Loss) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||
Investor Class | |||||||||||||||||||||||||||||||||||
2021 | $21.11 | (0.10) | 5.29 | 5.19 | (1.36) | $24.94 | 25.57% | 1.11% | (0.40)% | 136% | $41,838 | ||||||||||||||||||||||||
2020 | $15.81 | (0.11) | 6.19 | 6.08 | (0.78) | $21.11 | 40.28% | 1.39% | (0.63)% | 204% | $21,562 | ||||||||||||||||||||||||
2019 | $13.66 | (0.06) | 2.44 | 2.38 | (0.23) | $15.81 | 17.93% | 1.51% | (0.39)% | 161% | $15,005 | ||||||||||||||||||||||||
2018 | $14.80 | (0.13) | (0.24) | (0.37) | (0.77) | $13.66 | (2.73)% | 1.50% | (0.86)% | 147% | $15,159 | ||||||||||||||||||||||||
2017 | $10.85 | (0.06) | 4.01 | 3.95 | — | $14.80 | 36.41% | 1.51% | (0.44)% | 130% | $10,059 | ||||||||||||||||||||||||
I Class | |||||||||||||||||||||||||||||||||||
2021 | $21.33 | (0.04) | 5.34 | 5.30 | (1.36) | $25.27 | 25.84% | 0.91% | (0.20)% | 136% | $11,067 | ||||||||||||||||||||||||
2020 | $15.94 | (0.08) | 6.25 | 6.17 | (0.78) | $21.33 | 40.62% | 1.19% | (0.43)% | 204% | $587 | ||||||||||||||||||||||||
2019 | $13.74 | (0.02) | 2.45 | 2.43 | (0.23) | $15.94 | 18.12% | 1.31% | (0.19)% | 161% | $557 | ||||||||||||||||||||||||
2018 | $14.85 | (0.10) | (0.24) | (0.34) | (0.77) | $13.74 | (2.50)% | 1.30% | (0.66)% | 147% | $1,424 | ||||||||||||||||||||||||
2017 | $10.86 | (0.02) | 4.01 | 3.99 | — | $14.85 | 36.74% | 1.31% | (0.24)% | 130% | $891 | ||||||||||||||||||||||||
A Class | |||||||||||||||||||||||||||||||||||
2021 | $20.85 | (0.16) | 5.22 | 5.06 | (1.36) | $24.55 | 25.25% | 1.36% | (0.65)% | 136% | $317 | ||||||||||||||||||||||||
2020 | $15.66 | (0.15) | 6.12 | 5.97 | (0.78) | $20.85 | 39.95% | 1.64% | (0.88)% | 204% | $63 | ||||||||||||||||||||||||
2019 | $13.57 | (0.08) | 2.40 | 2.32 | (0.23) | $15.66 | 17.60% | 1.76% | (0.64)% | 161% | $671 | ||||||||||||||||||||||||
2018 | $14.74 | (0.17) | (0.23) | (0.40) | (0.77) | $13.57 | (2.95)% | 1.75% | (1.11)% | 147% | $1,477 | ||||||||||||||||||||||||
2017 | $10.83 | (0.08) | 3.99 | 3.91 | — | $14.74 | 36.10% | 1.76% | (0.69)% | 130% | $1,517 |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Ratio to Average Net Assets of: | ||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Distributions From Net Realized Gains | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Net Investment Income (Loss) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||
C Class | |||||||||||||||||||||||||||||||||||
2021 | $20.08 | (0.33) | 5.02 | 4.69 | (1.36) | $23.41 | 24.32% | 2.11% | (1.40)% | 136% | $178 | ||||||||||||||||||||||||
2020 | $15.22 | (0.26) | 5.90 | 5.64 | (0.78) | $20.08 | 38.88% | 2.39% | (1.63)% | 204% | $45 | ||||||||||||||||||||||||
2019 | $13.29 | (0.18) | 2.34 | 2.16 | (0.23) | $15.22 | 16.75% | 2.51% | (1.39)% | 161% | $595 | ||||||||||||||||||||||||
2018 | $14.56 | (0.28) | (0.22) | (0.50) | (0.77) | $13.29 | (3.71)% | 2.50% | (1.86)% | 147% | $1,407 | ||||||||||||||||||||||||
2017 | $10.78 | (0.17) | 3.95 | 3.78 | — | $14.56 | 35.06% | 2.51% | (1.44)% | 130% | $1,468 | ||||||||||||||||||||||||
R Class | |||||||||||||||||||||||||||||||||||
2021 | $20.59 | (0.21) | 5.15 | 4.94 | (1.36) | $24.17 | 24.97% | 1.61% | (0.90)% | 136% | $1,937 | ||||||||||||||||||||||||
2020 | $15.52 | (0.18) | 6.03 | 5.85 | (0.78) | $20.59 | 39.52% | 1.89% | (1.13)% | 204% | $839 | ||||||||||||||||||||||||
2019 | $13.48 | (0.12) | 2.39 | 2.27 | (0.23) | $15.52 | 17.34% | 2.01% | (0.89)% | 161% | $523 | ||||||||||||||||||||||||
2018 | $14.68 | (0.21) | (0.22) | (0.43) | (0.77) | $13.48 | (3.18)% | 2.00% | (1.36)% | 147% | $493 | ||||||||||||||||||||||||
2017 | $10.81 | (0.11) | 3.98 | 3.87 | — | $14.68 | 35.80% | 2.01% | (0.94)% | 130% | $338 | ||||||||||||||||||||||||
R6 Class | |||||||||||||||||||||||||||||||||||
2021 | $21.49 | (0.01) | 5.39 | 5.38 | (1.36) | $25.51 | 26.03% | 0.76% | (0.05)% | 136% | $15,878 | ||||||||||||||||||||||||
2020 | $16.03 | (0.03) | 6.27 | 6.24 | (0.78) | $21.49 | 40.75% | 1.04% | (0.28)% | 204% | $24,743 | ||||||||||||||||||||||||
2019 | $13.79 | —(3) | 2.47 | 2.47 | (0.23) | $16.03 | 18.34% | 1.16% | (0.04)% | 161% | $207 | ||||||||||||||||||||||||
2018 | $14.89 | (0.08) | (0.25) | (0.33) | (0.77) | $13.79 | (2.36)% | 1.15% | (0.51)% | 147% | $361 | ||||||||||||||||||||||||
2017 | $10.87 | (0.01) | 4.03 | 4.02 | — | $14.89 | 36.86% | 1.16% | (0.09)% | 130% | $366 |
Notes to Financial Highlights |
(1)Computed using average shares outstanding throughout the period.
(2)Total returns are calculated based on the net asset value of the last business day and do not reflect applicable sales charges, if any. Total returns for periods less than one year are not annualized.
(3)Per-share amount was less than $0.005.
See Notes to Financial Statements.
Report of Independent Registered Public Accounting Firm |
To the Shareholders and the Board of Directors of American Century World Mutual Funds, Inc.:
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Global Small Cap Fund (the “Fund”), one of the funds constituting the American Century World Mutual Funds, Inc., as of November 30, 2021, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of Global Small Cap Fund of the American Century World Mutual Funds, Inc. as of November 30, 2021, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund’s financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. 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, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of November 30, 2021, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
/s/ Deloitte & Touche LLP
Kansas City, Missouri
January 19, 2022
We have served as the auditor of one or more American Century investment companies since 1997.
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Management |
The Board of Directors
The individuals listed below serve as directors of the funds. Each director will continue to serve in this capacity until death, retirement, resignation or removal from office. The board has adopted a mandatory retirement age for directors who are not “interested persons,” as that term is defined in the Investment Company Act (independent directors). Independent directors shall retire by December 31 of the year in which they reach their 75th birthday.
Jonathan S. Thomas is an “interested person” because he currently serves as President and Chief Executive Officer of American Century Companies, Inc. (ACC), the parent company of American Century Investment Management, Inc. (ACIM or the advisor). The other directors (more than three-fourths of the total number) are independent. They are not employees, directors or officers of, and have no financial interest in, ACC or any of its wholly owned, direct or indirect, subsidiaries, including ACIM, American Century Investment Services, Inc. (ACIS) and American Century Services, LLC (ACS), and they do not have any other affiliations, positions or relationships that would cause them to be considered “interested persons” under the Investment Company Act. The directors serve in this capacity for seven (in the case of Jonathan S. Thomas, 16; and Stephen E. Yates, 8) registered investment companies in the American Century Investments family of funds.
The following table presents additional information about the directors. The mailing address for each director is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Thomas W. Bunn (1953) | Director | Since 2017 | Retired | 72 | SquareTwo Financial; Barings (formerly Babson Capital Funds Trust) (2013 to 2016) | ||||||||||||
Chris H. Cheesman (1962) | Director | Since 2019 | Retired. Senior Vice President & Chief Audit Executive, AllianceBernstein (1999 to 2018) | 72 | Alleghany Corporation | ||||||||||||
Barry Fink (1955) | Director | Since 2012 (independent since 2016) | Retired | 72 | None | ||||||||||||
Rajesh K. Gupta (1960) | Director | Since 2019 | Partner Emeritus, SeaCrest Investment Management and SeaCrest Wealth Management (2019 to Present); Chief Executive Officer and Chief Investment Officer, SeaCrest Investment Management (2006 to 2019); Chief Executive Officer and Chief Investment Officer, SeaCrest Wealth Management (2008 to 2019) | 72 | None |
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Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Lynn Jenkins (1963) | Director | Since 2019 | Consultant, LJ Strategies (2019 to present); United States Representative, U.S. House of Representatives (2009 to 2018) | 72 | MGP Ingredients, Inc. (2019 to 2021) | ||||||||||||
Jan M. Lewis (1957) | Director | Since 2011 | Retired | 72 | None | ||||||||||||
John R. Whitten(1) (1946) | Director | Since 2008 | Retired | 72 | Onto Innovation Inc. (2019 to 2020); Rudolph Technologies, Inc. (2006 to 2019) | ||||||||||||
Stephen E. Yates (1948) | Director and Chairman of the Board | Since 2012 (Chairman since 2018) | Retired | 108 | None | ||||||||||||
Interested Director | |||||||||||||||||
Jonathan S. Thomas (1963) | Director | Since 2007 | President and Chief Executive Officer, ACC (2007 to present). Also serves as Chief Executive Officer, ACS; Director, ACC and other ACC subsidiaries | 146 | None |
(1) Effective December 31, 2021, John R. Whitten retired from the Board of Directors.
The Statement of Additional Information has additional information about the fund's directors and is available without charge, upon request, by calling 1-800-345-2021.
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Officers
The following table presents certain information about the executive officers of the funds. Each officer serves as an officer for each of the 16 (in the case of Robert J. Leach, 15) investment companies in the American Century family of funds. No officer is compensated for his or her service as an officer of the funds. The listed officers are interested persons of the funds and are appointed or re-appointed on an annual basis. The mailing address for each officer listed below is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Offices with the Funds | Principal Occupation(s) During the Past Five Years | ||||||
Patrick Bannigan (1965) | President since 2019 | Executive Vice President and Director, ACC (2012 to present); Chief Financial Officer, Chief Accounting Officer and Treasurer, ACC (2015 to present). Also serves as President, ACS; Vice President, ACIM; Chief Financial Officer, Chief Accounting Officer and/or Director, ACIM, ACS and other ACC subsidiaries | ||||||
R. Wes Campbell (1974) | Chief Financial Officer and Treasurer since 2018 | Vice President, ACS, (2020 to present); Investment Operations and Investment Accounting, ACS (2000 to present) | ||||||
Amy D. Shelton (1964) | Chief Compliance Officer and Vice President since 2014 | Chief Compliance Officer, American Century funds, (2014 to present); Chief Compliance Officer, ACIM (2014 to present); Chief Compliance Officer, ACIS (2009 to present). Also serves as Vice President, ACIS | ||||||
John Pak (1968) | General Counsel and Senior Vice President since 2021 | General Counsel and Senior Vice President, ACC (2021 to present). Also serves as General Counsel and Senior Vice President, ACIM, ACS and ACIS. Chief Legal Officer of Investment and Wealth Management, The Bank of New York Mellon (2014 to 2021) | ||||||
C. Jean Wade (1964) | Vice President since 2012 | Senior Vice President, ACS (2017 to present); Vice President, ACS (2000 to 2017) | ||||||
Robert J. Leach (1966) | Vice President since 2006 | Vice President, ACS (2000 to present) | ||||||
David H. Reinmiller (1963) | Vice President since 2000 | Attorney, ACC (1994 to present). Also serves as Vice President, ACIM and ACS | ||||||
Ward D. Stauffer (1960) | Secretary since 2005 | Attorney, ACC (2003 to present) |
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Approval of Management Agreement |
At a meeting held on June 30, 2021, the Fund’s Board of Directors (the "Board") unanimously approved the renewal of the management agreement pursuant to which American Century Investment Management, Inc. (the “Advisor”) acts as the investment advisor for the Fund. Under Section 15(c) of the Investment Company Act, contracts for investment advisory services are required to be reviewed, evaluated, and approved by a majority of a fund’s directors (the “Directors”), including a majority of the independent Directors, each year.
Prior to its consideration of the renewal of the management agreement, the Directors requested and reviewed extensive data and information compiled by the Advisor and certain independent providers of evaluation data concerning the Fund and the services provided to the Fund by the Advisor. This review was in addition to the oversight and evaluation undertaken by the Board and its committees on a continual basis and the information received was supplemental to the extensive information that the Board and its committees receive and consider throughout the year.
In connection with its consideration of the renewal of the management agreement, the Board’s review and evaluation of the services provided by the Advisor and its affiliates included, but was not limited to, the following:
•the nature, extent, and quality of investment management, shareholder services, and other services provided and to be provided to the Fund including without limitation portfolio management and trading services, shareholder and intermediary services, compliance and legal services, fund accounting and financial reporting, and fund share distribution;
•the wide range of other programs and services provided and to be provided to the Fund and its shareholders on a routine and non-routine basis;
•the Fund’s investment performance, including data comparing the Fund's performance to appropriate benchmarks and/or a peer group of other mutual funds with similar investment objectives and strategies;
•the cost of owning the Fund compared to the cost of owning similar funds;
•the compliance policies, procedures, and regulatory experience of the Advisor and the Fund's service providers;
•the Advisor’s strategic plans, COVID-19 pandemic response, vendor management practices, and social justice initiatives;
•the Advisor’s business continuity plans and cyber security practices;
•financial data showing the cost of services provided to the Fund, the profitability of the Fund to the Advisor, and the overall profitability of the Advisor;
•possible economies of scale associated with the Advisor’s management of the Fund and other accounts;
•services provided and charges to the Advisor's other investment management clients;
•acquired fund fees and expenses;
•payments and practices in connection with financial intermediaries holding shares of the Fund and the services provided by intermediaries in connection therewith; and
•possible collateral benefits to the Advisor from the management of the Fund.
The Board held two meetings to consider the renewal. The independent Directors also met in private session three times to review and discuss the information provided in response to their request. The independent Directors held active discussions with the Advisor regarding the renewal of the management agreement, requesting supplemental information, and reviewing information provided by the Advisor in response thereto. The independent Directors had the benefit of the advice of their independent counsel throughout the process.
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Factors Considered
The Directors considered all of the information provided by the Advisor, the independent data providers, and independent counsel in connection with the approval. They determined that the information was sufficient for them to evaluate the management agreement for the Fund. In connection with their review, the Directors did not identify any single factor as being all-important or controlling, and each Director may have attributed different levels of importance to different factors. In deciding to renew the management agreement, the Board based its decision on a number of factors, including without limitation the following:
Nature, Extent and Quality of Services — Generally. Under the management agreement, the Advisor is responsible for providing or arranging for all services necessary for the operation of the Fund. The Board noted that the Advisor provides or arranges at its own expense a wide variety of services which include the following:
•constructing and designing the Fund
•portfolio research and security selection
•initial capitalization/funding
•securities trading
•Fund administration
•custody of Fund assets
•daily valuation of the Fund’s portfolio
•liquidity monitoring and management
•risk management, including cyber security
•shareholder servicing and transfer agency, including shareholder confirmations, recordkeeping, and communications
•legal services (except the independent Directors’ counsel)
•regulatory and portfolio compliance
•financial reporting
•marketing and distribution (except amounts paid by the Fund under Rule 12b-1 plans)
The Board noted that many of these services have expanded over time in terms of both quantity and complexity in response to shareholder demands, competition in the industry, changing distribution channels, and the changing regulatory environment.
Investment Management Services. The nature of the investment management services provided to the Fund is quite complex and allows Fund shareholders access to professional money management, instant diversification of their investments within an asset class, the opportunity to easily diversify among asset classes by investing in or exchanging among various American Century Investments funds, and liquidity. In evaluating investment performance, the Board expects the Advisor to manage the Fund in accordance with its investment objectives and approved strategies. Further, the Directors recognize that the Advisor has an obligation to monitor trading activities, and in particular to seek the best execution of fund trades, and to evaluate the use of and payment for research. In providing these services, the Advisor utilizes teams of investment professionals (portfolio managers, analysts, research assistants, and securities traders) who require extensive information technology, research, training, compliance, and other systems to conduct their business. The Board, directly and through its Fund Performance Review Committee, provides oversight of the investment performance process. It regularly reviews investment performance information for the Fund, together with comparative information for appropriate benchmarks and/or peer groups of similarly-managed funds, over different time horizons. The Directors also review investment performance information during the management agreement renewal process. If performance concerns are identified, the Fund receives special reviews until performance improves, during which the Board discusses with the Advisor the reasons for such results (e.g., market conditions, security selection) and any efforts being undertaken to improve performance. The Fund’s performance was above its benchmark for the one- and three-year periods reviewed by the Board. The Board found the investment management services provided by the Advisor to the Fund to be satisfactory and consistent with the management agreement.
33
Shareholder and Other Services. Under the management agreement, the Advisor provides the Fund with a comprehensive package of transfer agency, shareholder, and other services. The Board, directly and through its various committees, regularly reviews reports and evaluations of such services at its regular meetings. These reports include, but are not limited to, information regarding the operational efficiency and accuracy of the shareholder and transfer agency services provided, staffing levels, shareholder satisfaction, technology support (including cyber security), new products and services offered to Fund shareholders, securities trading activities, portfolio valuation services, auditing services, and legal and operational compliance activities. The Board found the services provided by the Advisor to the Fund under the management agreement to be competitive and of high quality.
Costs of Services and Profitability. The Advisor provides detailed information concerning its cost of providing various services to the Fund, its profitability in managing the Fund (pre- and post-distribution), its overall profitability, and its financial condition. The Directors have reviewed with the Advisor the methodology used to prepare this financial information. This information is considered in evaluating the Advisor’s financial condition, its ability to continue to provide services under the management agreement, and the reasonableness of the current management fee. The Board concluded that the Advisor’s profits were reasonable in light of the services provided to the Fund.
Ethics. The Board generally considers the Advisor’s commitment to providing quality services to shareholders and to conducting its business ethically. They noted that the Advisor’s practices generally meet or exceed industry best practices.
Economies of Scale. The Board also reviewed information provided by the Advisor regarding the possible existence of economies of scale in connection with the management of the Fund. The Board concluded that economies of scale are difficult to measure and predict with precision, especially on a fund-by-fund basis. The Board concluded that the Advisor is sharing economies of scale, to the extent they exist, through its competitive fee structure, offering competitive fees from fund inception, and through reinvestment in its business, infrastructure, investment capabilities and initiatives to provide shareholders additional content and services.
Comparison to Other Funds’ Fees. The management agreement provides that the Fund pays the Advisor a single, all-inclusive (or unified) management fee for providing all services necessary for the management and operation of the Fund, other than brokerage expenses, expenses attributable to short sales, taxes, interest, extraordinary expenses, fees and expenses of the Fund’s independent Directors (including their independent legal counsel), and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the Investment Company Act. Under the unified fee structure, the Advisor is responsible for providing all investment advisory, custody, audit, administrative, compliance, recordkeeping, marketing and shareholder services, or arranging and supervising third parties to provide such services. By contrast, most other funds are charged a variety of fees, including an investment advisory fee, a transfer agency fee, an administrative fee, distribution charges, and other expenses. Other than their investment advisory fees and any applicable Rule 12b-1 distribution fees, all other components of the total fees charged by these other funds may be increased without shareholder approval. The Board believes the unified fee structure is a benefit to Fund shareholders because it clearly discloses to shareholders the cost of owning Fund shares, and, since the unified fee cannot be increased without a vote of Fund shareholders, it shifts to the Advisor the risk of increased costs of operating the Fund and provides a direct incentive to minimize administrative inefficiencies. Part of the Board’s analysis of fee levels involves reviewing certain evaluative data compiled by an independent provider comparing the Fund’s unified fee to the total expense ratios of its peers. The unified fee charged to shareholders of the Fund was below the median of the total expense ratios of the Fund’s peer expense universe. In addition, the Board reviewed the Fund’s position relative to the narrower set of its expense group peers. The Board concluded that the management fee paid by the Fund to the Advisor under the management agreement is reasonable in light of the services provided to the Fund.
Comparison to Fees and Services Provided to Other Clients of the Advisor. The Board also requested and received information from the Advisor concerning the nature of the services, fees, costs, and profitability of its advisory services to advisory clients other than the Fund. They
34
observed that these varying types of client accounts require different services and involve different regulatory and entrepreneurial risks than the management of the Fund. The Board analyzed this information and concluded that the fees charged and services provided to the Fund were reasonable by comparison.
Payments to Intermediaries. The Directors also requested and received a description of payments made to intermediaries by the Fund and the Advisor and services provided in response thereto. These payments include various payments made by the Fund or the Advisor to different types of intermediaries and recordkeepers for distribution and service activities provided for the Fund. The Directors reviewed such information and received representations from the Advisor that all such payments by the Fund were made pursuant to the Fund's Rule 12b-1 Plan and that all such payments by the Advisor were made from the Advisor’s resources and reasonable profits. The Board found such payments to be reasonable in scope and purpose.
Collateral or “Fall-Out” Benefits Derived by the Advisor. The Board considered the possible existence of collateral benefits the Advisor may receive as a result of its relationship with the Fund. They concluded that the Advisor’s primary business is managing funds and it generally does not use fund or shareholder information to generate profits in other lines of business, and therefore does not derive any significant collateral benefits from them. To the extent there are potential collateral benefits, the Board has been advised and has taken this into consideration in its review of the management contract with the Fund. The Board noted that additional assets from other clients may offer the Advisor some benefit from increased leverage with service providers and counterparties. Additionally, the Advisor may receive proprietary research from broker-dealers that execute fund portfolio transactions, which the Board concluded is likely to benefit other clients of the Advisor, as well as Fund shareholders. The Board also determined that the Advisor is able to provide investment management services to certain clients other than the Fund, at least in part, due to its existing infrastructure built to serve the fund complex. The Board concluded that appropriate allocation methodologies had been employed to assign resources and the cost of those resources to these other clients.
Existing Relationship. The Board also considered whether there was any reason for not continuing the existing arrangement with the Advisor. In this regard, the Board was mindful of the potential disruptions of the Fund’s operations and various risks, uncertainties, and other effects that could occur as a result of a decision not to continue such relationship. In particular, the Board recognized that most shareholders have invested in the Fund on the strength of the Advisor’s industry standing and reputation and in the expectation that the Advisor will have a continuing role in providing advisory services to the Fund.
Conclusion of the Directors. As a result of this process, the Board, including all of the independent Directors, taking into account all of the factors discussed above and the information provided by the Advisor and others in connection with its review and throughout the year, determined that the management fee is fair and reasonable in light of the services provided and that the investment management agreement between the Fund and the Advisor should be renewed.
35
Additional Information |
Retirement Account Information
As required by law, distributions you receive from certain retirement accounts are subject to federal income tax withholding, unless you elect not to have withholding apply*. Tax will be withheld on the total amount withdrawn even though you may be receiving amounts that are not subject to withholding, such as nondeductible contributions. In such case, excess amounts of withholding could occur. You may adjust your withholding election so that a greater or lesser amount will be withheld.
If you don’t want us to withhold on this amount, you must notify us to not withhold the federal income tax. You may notify us in writing or in certain situations by telephone or through other electronic means. For systematic withdrawals, your withholding election will remain in effect until revoked or changed by filing a new election. You have the right to revoke your election at any time and change your withholding percentage for future distributions.
Remember, even if you elect not to have income tax withheld, you are liable for paying income tax on the taxable portion of your withdrawal. If you elect not to have income tax withheld or you don’t have enough income tax withheld, you may be responsible for payment of estimated tax. You may incur penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. You can reduce or defer the income tax on a distribution by directly or indirectly rolling such distribution over to another IRA or eligible plan. You should consult your tax advisor for additional information.
State tax will be withheld if, at the time of your distribution, your address is within one of the mandatory withholding states and you have federal income tax withheld (or as otherwise required by state law). State taxes will be withheld from your distribution in accordance with the respective state rules.
*Some 403(b), 457 and qualified retirement plan distributions may be subject to 20% mandatory withholding, as they are subject to special tax and withholding rules. Your plan administrator or plan sponsor is required to provide you with a special tax notice explaining those rules at the time you request a distribution. If applicable, federal and/or state taxes may be withheld from your distribution amount.
Proxy Voting Policies
A description of the policies that the fund's investment advisor uses in exercising the voting rights associated with the securities purchased and/or held by the fund is available without charge, upon request, by calling 1-800-345-2021. It is also available on American Century Investments’ website at americancentury.com/proxy and on the Securities and Exchange Commission’s website at sec.gov. Information regarding how the investment advisor voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on americancentury.com/proxy. It is also available at sec.gov.
Quarterly Portfolio Disclosure
The fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. These portfolio holdings are available on the fund's website at americancentury.com and, upon request, by calling 1-800-345-2021. The fund’s Form N-PORT reports are available on the SEC’s website at sec.gov.
36
Other Tax Information
The following information is provided pursuant to provisions of the Internal Revenue Code.
The fund hereby designates up to the maximum amount allowable as qualified dividend income for the fiscal year ended November 30, 2021.
For corporate taxpayers, the fund hereby designates $58,974, or up to the maximum amount allowable, of ordinary income distributions paid during the fiscal year ended November 30, 2021 as qualified for the corporate dividends received deduction.
The fund hereby designates $3,327,742, or up to the maximum amount allowable, as long-term capital gain distributions (20% rate gain distributions) for the fiscal year ended November 30, 2021.
The fund hereby designates $1,209,846 as qualified short-term capital gain distributions for purposes of Internal Revenue Code Section 871 for the fiscal year ended November 30, 2021.
The fund utilized earnings and profits of $1,575,426 distributed to shareholders on redemption of shares as part of the dividends paid deduction (tax equalization).
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Notes |
38
Notes |
39
Notes |
40
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Contact Us | americancentury.com | |||||||
Automated Information Line | 1-800-345-8765 | |||||||
Investor Services Representative | 1-800-345-2021 or 816-531-5575 | |||||||
Investors Using Advisors | 1-800-378-9878 | |||||||
Business, Not-For-Profit, Employer-Sponsored Retirement Plans | 1-800-345-3533 | |||||||
Banks and Trust Companies, Broker-Dealers, Financial Professionals, Insurance Companies | 1-800-345-6488 | |||||||
Telecommunications Relay Service for the Deaf | 711 | |||||||
American Century World Mutual Funds, Inc. | ||||||||
Investment Advisor: American Century Investment Management, Inc. Kansas City, Missouri | ||||||||
This report and the statements it contains are submitted for the general information of our shareholders. The report is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. | ||||||||
©2022 American Century Proprietary Holdings, Inc. All rights reserved. CL-ANN-91035 2201 |
![image37.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image37.jpg)
Annual Report | |||||
November 30, 2021 | |||||
International Growth Fund | |||||
Investor Class (TWIEX) | |||||
I Class (TGRIX) | |||||
Y Class (ATYGX) | |||||
A Class (TWGAX) | |||||
C Class (AIWCX) | |||||
R Class (ATGRX) | |||||
R5 Class (ATGGX) | |||||
R6 Class (ATGDX) |
Table of Contents |
President’s Letter | |||||
Performance | |||||
Portfolio Commentary | |||||
Fund Characteristics | |||||
Shareholder Fee Example | |||||
Schedule of Investments | |||||
Statement of Assets and Liabilities | |||||
Statement of Operations | |||||
Statement of Changes in Net Assets | |||||
Notes to Financial Statements | |||||
Financial Highlights | |||||
Report of Independent Registered Public Accounting Firm | |||||
Management | |||||
Approval of Management Agreement | |||||
Additional Information |
Any opinions expressed in this report reflect those of the author as of the date of the report, and do not necessarily represent the opinions of American Century Investments® or any other person in the American Century Investments organization. Any such opinions are subject to change at any time based upon market or other conditions and American Century Investments disclaims any responsibility to update such opinions. These opinions may not be relied upon as investment advice and, because investment decisions made by American Century Investments funds are based on numerous factors, may not be relied upon as an indication of trading intent on behalf of any American Century Investments fund. Security examples are used for representational purposes only and are not intended as recommendations to purchase or sell securities. Performance information for comparative indices and securities is provided to American Century Investments by third party vendors. To the best of American Century Investments’ knowledge, such information is accurate at the time of printing.
President’s Letter |
![image30a.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image30a.jpg)
Dear Investor:
Thank you for reviewing this annual report for the period ended November 30, 2021. Annual reports help convey important information about fund returns, including market factors that affected performance. For additional investment insights, please visit americancentury.com.
Global Stocks Advanced Despite Lingering and New Challenges
Global stocks broadly delivered solid gains for the 12-month period, even as pandemic-related challenges persisted. Improving economic data, along with central bank and government support and positive vaccine developments, helped boost corporate earnings and promote investor optimism. The U.S. generally outpaced other nations. Virus outbreaks and slower vaccine rollouts, particularly in emerging markets, led to lingering lockdowns in some regions.
As the period progressed, steady economic gains combined with ongoing monetary and fiscal support, rising energy prices and severe supply chain disruptions pushed global interest rates and inflation higher. In the U.S., year-over-year headline inflation climbed to 6.8% in November 2021, the largest 12-month increase in nearly 40 years. Similarly, inflation in the eurozone hit a 30-year high, while prices in the U.K. climbed to their highest level in 10 years.
Late in the period, the Federal Reserve began tapering its bond buying while adopting a more hawkish rate-tightening outlook amid surging inflation. However, central banks in Europe and the U.K. maintained their supportive programs, expressing concerns about slowing global growth outlooks. Meanwhile, the emergence of a new COVID-19 variant in late November triggered a steep sell-off among global stocks to end the reporting period.
Despite mounting inflation worries and late-period volatility, global stocks delivered solid performance for the full 12 months, highlighted by strong gains in developed markets. Emerging markets stocks generally delivered more modest returns.
Several Factors Shaping Market Dynamics
The return to pre-pandemic life is progressing, albeit somewhat cautiously due to COVID-19’s lingering effects. As the economy and markets respond to this fluid backdrop, investors will face opportunities and ongoing challenges. Economic growth, inflation, the virus’s trajectory, supply chain normalization and fiscal and monetary policy likely will sway market dynamics.
We appreciate your confidence in us during these extraordinary times. Our firm has a long history of helping clients weather unpredictable markets, and we’re confident we will continue to meet today’s challenges.
Sincerely,
![image23.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image23.jpg)
Jonathan Thomas
President and Chief Executive Officer
American Century Investments
2
Performance |
Total Returns as of November 30, 2021 | ||||||||||||||||||||
Average Annual Returns | ||||||||||||||||||||
Ticker Symbol | 1 year | 5 years | 10 years | Since Inception | Inception Date | |||||||||||||||
Investor Class | TWIEX | 10.83% | 13.96% | 9.53% | — | 5/9/91 | ||||||||||||||
MSCI EAFE Index | — | 10.77% | 9.19% | 7.38% | — | — | ||||||||||||||
MSCI EAFE Growth Index | — | 11.84% | 13.12% | 9.46% | — | — | ||||||||||||||
I Class | TGRIX | 11.07% | 14.19% | 9.74% | — | 11/20/97 | ||||||||||||||
Y Class | ATYGX | 11.23% | — | — | 13.19% | 4/10/17 | ||||||||||||||
A Class | TWGAX | 10/2/96 | ||||||||||||||||||
No sales charge | 10.53% | 13.66% | 9.25% | — | ||||||||||||||||
With sales charge | 4.18% | 12.32% | 8.60% | — | ||||||||||||||||
C Class | AIWCX | 9.72% | 12.81% | 8.44% | — | 6/4/01 | ||||||||||||||
R Class | ATGRX | 10.25% | 13.38% | 8.98% | — | 8/29/03 | ||||||||||||||
R5 Class | ATGGX | 11.06% | — | — | 13.02% | 4/10/17 | ||||||||||||||
R6 Class | ATGDX | 11.23% | 14.34% | — | 8.36% | 7/26/13 |
Average annual returns since inception are presented when ten years of performance history is not available.
C Class shares will automatically convert to A Class shares after being held for approximately eight years. C Class average annual returns do not reflect this conversion.
Sales charges include initial sales charges and contingent deferred sales charges (CDSCs), as applicable. A Class shares have a 5.75% maximum initial sales charge and may be subject to a maximum CDSC of 1.00%. C Class shares redeemed within 12 months of purchase are subject to a maximum CDSC of 1.00%. The SEC requires that mutual funds provide performance information net of maximum sales charges in all cases where charges could be applied.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
3
Growth of $10,000 Over 10 Years | ||
$10,000 investment made November 30, 2011 | ||
Performance for other share classes will vary due to differences in fee structure. |
![chart-9659400d9787471b8e3.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/chart-9659400d9787471b8e3.jpg)
Value on November 30, 2021 | |||||
Investor Class — $24,858 | |||||
MSCI EAFE Index — $20,400 | |||||
MSCI EAFE Growth Index — $24,709 | |||||
Total Annual Fund Operating Expenses | |||||||||||||||||||||||
Investor Class | I Class | Y Class | A Class | C Class | R Class | R5 Class | R6 Class | ||||||||||||||||
1.18% | 0.98% | 0.83% | 1.43% | 2.18% | 1.68% | 0.98% | 0.83% |
The total annual fund operating expenses shown is as stated in the fund’s prospectus current as of the date of this report. The prospectus may vary from the expense ratio shown elsewhere in this report because it is based on a different time period, includes acquired fund fees and expenses, and, if applicable, does not include fee waivers or expense reimbursements.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
4
Portfolio Commentary |
Portfolio Managers: Raj Gandhi and Jim Zhao
Performance Summary
International Growth returned 10.83%* for the fiscal year ended November 30, 2021, performing in line with its benchmark, the MSCI EAFE Index, which returned 10.77%.
Stock holdings in the health care sector and positioning within information technology propelled the fund’s performance, with additional contribution from industrials and communication services stocks. Stock selection in the consumer discretionary, financials and energy sectors constrained returns. From a geographic perspective, European holdings and underweight positioning in Japan benefited relative performance, whereas stock selection in the U.K. and positioning in China and Brazil detracted.
The development of effective vaccines against COVID-19 late in 2020 raised hopes for a return to normalized economic activity and spurred strong gains among non-U.S. equities. As vaccine distribution ramped up in early 2021, markets rotated toward stocks exposed to economic expansion. Names that had previously lagged, such as banks, oil producers and automobile manufacturers, rallied. However, as the recovery cycle matured, markets returned to rewarding individual companies demonstrating strong fundamentals and earnings improvement. Increased economic activity led to a strong corporate earnings recovery. In the second half of the period, global supply chain issues and disruptions due to the emergence of new coronavirus variants combined with rising energy costs and inflation concerns to create greater market volatility. Although the rate of corporate earnings improvement slowed late in the period, expectations for continued earnings recovery remained upbeat supported by continued demand strength.
Earnings Surpassed Expectations, Fueled Strong Performance
Among health care holdings, pharmaceuticals company Novo Nordisk reported revenue and earnings that exceeded expectations driven by strong demand for its oral diabetes and weight loss drugs. Companies that provide outsourcing services for pharmaceuticals and biotechnology companies advanced notably. Strong earnings results and the acquisition of PRA Health Sciences lifted the stock of clinical research provider ICON. Contract manufacturer Lonza Group’s stock rose on Food and Drug Administration approval of Biogen’s Alzheimer’s drug, which was expected to use substantial industry capacity.
A diverse array of companies fueled strong performance among information technology stocks. Payment processor Adyen’s stock rose on better-than-expected results as the firm grew its market share amid the accelerating shift to digital payments. Semiconductor equipment manufacturer ASML Holding benefited as rising chip demand exceeded supply. Information technology services firm Capgemini ranked among the top individual contributors to fund performance with ahead-of-expectations results driven by strength in the firm’s digital transformation and cloud-related business.
Among industrials, stock of human resources technology company Recruit Holdings advanced. The firm, which owns Indeed and Glassdoor, benefited amid the return of job search activity to pre-pandemic levels and intensified competition to recruit talent. Stock of Techtronic Industries, the maker of Ryobi and Milwaukee power tools, rose on reported results that significantly exceeded analysts’ estimates as the firm continued to gain market share due to cordless tool product innovation and proprietary battery technology. Ashtead Group, which leases construction equipment, was one of the fund’s top individual contributors. Ashtead’s reported earnings significantly exceeded estimates as the firm benefited from the acceleration in U.S. nonresidential construction, especially public infrastructure, warehouses, data centers and multifamily housing.
*All fund returns referenced in this commentary are for Investor Class shares. Performance for other share classes will vary due to differences in fee structure; when Investor Class performance exceeds that of the fund’s benchmark, other share classes may not. See page 3 for returns for all share classes.
5
On the downside, retailers Magazine Luiza and ASOS detracted from performance. Magazine Luiza’s stock declined amid intensifying competition in Brazil’s e-commerce market. In addition, weakness in the broader Brazilian market appeared to be slowing consumption trends, and we exited the position. ASOS’ stock fell when management lowered sales guidance for 2021. We sold the stock as ASOS appeared to be struggling to turn around its U.S. operations, and U.S. commercial momentum had been a key pillar of the growth story. Automotive supplier Valeo also declined as concerns over the impact of semiconductor shortages on automobile production pressured the stock.
Within financials, the fund’s underweight in banks weighed on relative returns. In addition, stock of insurer AIA Group underperformed due to concerns over COVID-19 disruptions impacting revenue growth. In energy, Neste’s stock fell due to challenges related to near-term maintenance costs and higher input prices due to a shortage of feedstocks for renewable diesel.
Portfolio Positioning
We remain committed to our disciplined, bottom-up process of identifying companies exhibiting accelerating, sustainable growth. Although the earnings growth that drove the market in the first half of 2021 subsequently stalled amid component and labor shortages, shipping delays and higher energy costs, we believe it should resume in the second half of 2022. In our view, bottlenecks in shipping and supply chains are transitory, and the most recent earnings season suggested that demand remains strong, and companies can pass through costs. We continue to maintain exposure to companies benefiting from strong secular trends, such as green energy and carbon reduction, including firms involved in wind generation, electric vehicle components and emissions testing. We also find opportunities related to shifts in global manufacturing with companies that specialize in factory automation design, components and software benefiting from increased capital investment in digital solutions for a variety of end markets.
As a result of our bottom-up stock selection process, we remain notably overweight to information technology and underweight to consumer staples. Geographically, we retain a large exposure to European stocks. We continue to be underweight to Japan and Asia in general and have reduced our exposure to China.
6
Fund Characteristics |
NOVEMBER 30, 2021 | |||||
Types of Investments in Portfolio | % of net assets | ||||
Common Stocks | 99.4% | ||||
Temporary Cash Investments | 0.1% | ||||
Temporary Cash Investments - Securities Lending Collateral | 1.2% | ||||
Other Assets and Liabilities | (0.7)% | ||||
Top Five Countries | % of net assets | ||||
France | 16.9% | ||||
Japan | 13.6% | ||||
United Kingdom | 9.9% | ||||
Netherlands | 8.6% | ||||
Switzerland | 8.1% |
7
Shareholder Fee Example |
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption/exchange fees; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in your fund and to compare these costs with the ongoing cost of investing in other mutual funds.
The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period from May 29, 2021 to November 30, 2021.
Actual Expenses
The table provides information about actual account values and actual expenses for each class. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. First, identify the share class you own. Then simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
If you hold Investor Class shares of any American Century Investments fund, or I Class shares of the American Century Diversified Bond Fund, in an American Century Investments account (i.e., not through a financial intermediary or employer-sponsored retirement plan account), American Century Investments may charge you a $25.00 annual account maintenance fee if the value of those shares is less than $10,000. We will redeem shares automatically in one of your accounts to pay the $25.00 fee. In determining your total eligible investment amount, we will include your investments in all personal accounts (including American Century Investments brokerage accounts) registered under your Social Security number. Personal accounts include individual accounts, joint accounts, UGMA/UTMA accounts, personal trusts, Coverdell Education Savings Accounts and IRAs (including traditional, Roth, Rollover, SEP-, SARSEP- and SIMPLE-IRAs), and certain other retirement accounts. If you have only business, business retirement, employer-sponsored or American Century Investments brokerage accounts, you are currently not subject to this fee. If you are subject to the account maintenance fee, your account value could be reduced by the fee amount.
Hypothetical Example for Comparison Purposes
The table also provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each class of your fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of a fund’s share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption/exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
8
Beginning Account Value 5/29/21 | Ending Account Value 11/30/21 | Expenses Paid During Period(1) 5/29/21 - 11/30/21 | Annualized Expense Ratio(1) | |||||||||||
Actual | ||||||||||||||
Investor Class | $1,000 | $986.00 | $6.22 | 1.23% | ||||||||||
I Class | $1,000 | $986.50 | $5.21 | 1.03% | ||||||||||
Y Class | $1,000 | $987.80 | $4.46 | 0.88% | ||||||||||
A Class | $1,000 | $984.90 | $7.48 | 1.48% | ||||||||||
C Class | $1,000 | $980.90 | $11.26 | 2.23% | ||||||||||
R Class | $1,000 | $983.20 | $8.74 | 1.73% | ||||||||||
R5 Class | $1,000 | $987.20 | $5.22 | 1.03% | ||||||||||
R6 Class | $1,000 | $987.80 | $4.46 | 0.88% | ||||||||||
Hypothetical | ||||||||||||||
Investor Class | $1,000 | $1,019.21 | $6.33 | 1.23% | ||||||||||
I Class | $1,000 | $1,020.23 | $5.30 | 1.03% | ||||||||||
Y Class | $1,000 | $1,021.00 | $4.53 | 0.88% | ||||||||||
A Class | $1,000 | $1,017.94 | $7.61 | 1.48% | ||||||||||
C Class | $1,000 | $1,014.12 | $11.44 | 2.23% | ||||||||||
R Class | $1,000 | $1,016.66 | $8.89 | 1.73% | ||||||||||
R5 Class | $1,000 | $1,020.23 | $5.30 | 1.03% | ||||||||||
R6 Class | $1,000 | $1,021.00 | $4.53 | 0.88% |
(1)Expenses are equal to the class's annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 186, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. Annualized expense ratio reflects actual expenses, including any applicable fee waivers or expense reimbursements and excluding any acquired fund fees and expenses.
9
Schedule of Investments |
NOVEMBER 30, 2021
Shares | Value | |||||||
COMMON STOCKS — 99.4% | ||||||||
Australia — 3.9% | ||||||||
Atlassian Corp. plc, Class A(1) | 51,760 | $ | 19,478,322 | |||||
CSL Ltd. | 147,090 | 31,982,880 | ||||||
NEXTDC Ltd.(1) | 577,630 | 4,900,368 | ||||||
Xero Ltd.(1) | 53,880 | 5,472,454 | ||||||
61,834,024 | ||||||||
Austria — 1.1% | ||||||||
Erste Group Bank AG | 416,790 | 18,260,871 | ||||||
Belgium — 1.5% | ||||||||
KBC Group NV | 293,920 | 24,671,743 | ||||||
Canada — 5.3% | ||||||||
Canadian Pacific Railway Ltd. | 262,870 | 18,396,476 | ||||||
First Quantum Minerals Ltd. | 383,720 | 8,179,338 | ||||||
GFL Environmental, Inc.(2) | 469,891 | 18,137,793 | ||||||
Shopify, Inc., Class A(1) | 13,210 | 20,072,023 | ||||||
Toronto-Dominion Bank (The) | 278,390 | 19,646,059 | ||||||
84,431,689 | ||||||||
China — 1.7% | ||||||||
Li Ning Co. Ltd. | 1,204,000 | 13,617,949 | ||||||
Wuxi Biologics Cayman, Inc.(1) | 961,000 | 12,963,682 | ||||||
26,581,631 | ||||||||
Denmark — 4.4% | ||||||||
Carlsberg A/S, B Shares | 111,520 | 17,318,914 | ||||||
DSV A/S | 28,812 | 6,273,112 | ||||||
Novo Nordisk A/S, B Shares | 332,440 | 35,587,691 | ||||||
Pandora A/S | 94,210 | 11,721,836 | ||||||
70,901,553 | ||||||||
Finland — 0.6% | ||||||||
Neste Oyj | 211,550 | 10,005,662 | ||||||
France — 16.9% | ||||||||
Air Liquide SA | 127,180 | 21,002,827 | ||||||
Airbus SE(1) | 112,450 | 12,551,677 | ||||||
Bureau Veritas SA | 432,310 | 13,691,397 | ||||||
Capgemini SE | 128,390 | 29,641,602 | ||||||
Dassault Systemes SE | 332,280 | 20,030,153 | ||||||
Edenred | 266,441 | 11,918,806 | ||||||
L'Oreal SA | 53,570 | 24,188,866 | ||||||
LVMH Moet Hennessy Louis Vuitton SE | 55,530 | 43,179,807 | ||||||
Pernod Ricard SA | 127,180 | 29,182,656 | ||||||
Safran SA | 106,850 | 11,934,476 | ||||||
Schneider Electric SE | 179,210 | 31,805,102 | ||||||
Teleperformance | 41,600 | 17,111,450 | ||||||
Valeo | 171,910 | 4,955,271 | ||||||
271,194,090 | ||||||||
Germany — 5.5% | ||||||||
Brenntag SE | 100,310 | 8,591,595 | ||||||
Daimler AG | 221,580 | 20,751,635 |
10
Shares | Value | |||||||
Infineon Technologies AG | 454,719 | $ | 20,559,414 | |||||
Puma SE | 181,810 | 21,966,519 | ||||||
Symrise AG | 116,930 | 16,448,757 | ||||||
88,317,920 | ||||||||
Hong Kong — 2.5% | ||||||||
AIA Group Ltd. | 2,552,200 | 26,868,138 | ||||||
Techtronic Industries Co. Ltd. | 624,000 | 12,833,624 | ||||||
39,701,762 | ||||||||
India — 1.1% | ||||||||
HDFC Bank Ltd. | 912,870 | 18,084,712 | ||||||
Indonesia — 0.5% | ||||||||
Bank Central Asia Tbk PT | 16,366,000 | 8,316,022 | ||||||
Ireland — 3.5% | ||||||||
CRH plc | 457,670 | 22,249,469 | ||||||
ICON plc(1) | 66,350 | 17,945,684 | ||||||
Ryanair Holdings plc, ADR(1) | 166,450 | 15,904,298 | ||||||
56,099,451 | ||||||||
Israel — 1.0% | ||||||||
Kornit Digital Ltd.(1) | 99,885 | 15,473,185 | ||||||
Italy — 2.4% | ||||||||
Ferrari NV | 80,930 | 21,177,343 | ||||||
Prysmian SpA | 180,570 | 6,694,613 | ||||||
Stellantis NV | 596,122 | 10,208,145 | ||||||
38,080,101 | ||||||||
Japan — 13.6% | ||||||||
BayCurrent Consulting, Inc. | 33,700 | 13,925,444 | ||||||
Food & Life Cos. Ltd. | 424,300 | 17,968,018 | ||||||
Hoya Corp. | 135,900 | 21,511,134 | ||||||
JSR Corp. | 192,200 | 7,150,257 | ||||||
Keyence Corp. | 56,400 | 34,831,580 | ||||||
Kobe Bussan Co. Ltd. | 265,200 | 9,997,179 | ||||||
MonotaRO Co. Ltd. | 524,400 | 10,323,866 | ||||||
Obic Co. Ltd. | 81,700 | 15,025,673 | ||||||
Pan Pacific International Holdings Corp. | 581,500 | 9,926,231 | ||||||
Recruit Holdings Co. Ltd. | 470,900 | 28,592,879 | ||||||
Sony Group Corp. | 273,800 | 33,405,981 | ||||||
Terumo Corp. | 395,200 | 16,094,200 | ||||||
218,752,442 | ||||||||
Netherlands — 8.6% | ||||||||
Adyen NV(1) | 12,038 | 33,343,274 | ||||||
Akzo Nobel NV | 104,140 | 10,958,272 | ||||||
ASML Holding NV | 54,550 | 42,815,226 | ||||||
ING Groep NV | 1,571,840 | 21,712,533 | ||||||
Koninklijke DSM NV | 68,633 | 14,772,325 | ||||||
Universal Music Group NV | 525,550 | 15,085,432 | ||||||
138,687,062 | ||||||||
Norway — 0.5% | ||||||||
AutoStore Holdings Ltd.(1) | 1,520,742 | 7,599,885 | ||||||
Singapore — 0.6% | ||||||||
Sea Ltd., ADR(1) | 32,220 | 9,281,615 | ||||||
Spain — 2.7% | ||||||||
Cellnex Telecom SA | 394,684 | 23,276,854 |
11
Shares | Value | |||||||
Iberdrola SA | 1,780,374 | $ | 19,979,438 | |||||
43,256,292 | ||||||||
Sweden — 2.3% | ||||||||
Epiroc AB, A Shares | 670,110 | 16,223,168 | ||||||
Hexagon AB, B Shares | 1,407,690 | 20,471,564 | ||||||
36,694,732 | ||||||||
Switzerland — 8.1% | ||||||||
Lonza Group AG | 38,200 | 30,802,471 | ||||||
On Holding AG, Class A(1) | 187,510 | 7,530,402 | ||||||
Partners Group Holding AG | 14,830 | 25,594,319 | ||||||
SIG Combibloc Group AG(1) | 582,520 | 15,355,280 | ||||||
Sika AG | 68,073 | 26,582,569 | ||||||
Zur Rose Group AG(1) | 25,130 | 9,513,251 | ||||||
Zurich Insurance Group AG | 35,240 | 14,487,499 | ||||||
129,865,791 | ||||||||
Taiwan — 0.8% | ||||||||
Taiwan Semiconductor Manufacturing Co. Ltd. | 641,000 | 13,633,221 | ||||||
Thailand — 0.4% | ||||||||
Kasikornbank PCL | 1,586,000 | 6,206,597 | ||||||
United Kingdom — 9.9% | ||||||||
Ashtead Group plc | 412,400 | 33,176,791 | ||||||
AstraZeneca plc | 342,740 | 37,576,216 | ||||||
Burberry Group plc | 363,230 | 8,531,132 | ||||||
HSBC Holdings plc(2) | 4,829,200 | 26,750,279 | ||||||
London Stock Exchange Group plc | 141,920 | 12,294,633 | ||||||
Reckitt Benckiser Group plc | 186,304 | 15,091,182 | ||||||
Segro plc | 803,850 | 15,023,287 | ||||||
Whitbread plc(1) | 285,950 | 10,658,965 | ||||||
159,102,485 | ||||||||
TOTAL COMMON STOCKS (Cost $1,091,285,116) | 1,595,034,538 | |||||||
TEMPORARY CASH INVESTMENTS — 0.1% | ||||||||
Repurchase Agreement, BMO Capital Markets Corp., (collateralized by various U.S. Treasury obligations, 0.125% - 2.625%, 6/30/22 - 5/15/51, valued at $516,059), in a joint trading account at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $505,237) | 505,237 | |||||||
Repurchase Agreement, Fixed Income Clearing Corp., (collateralized by various U.S. Treasury obligations, 1.00%, 7/31/28, valued at $1,717,704), at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $1,684,001) | 1,684,000 | |||||||
State Street Institutional U.S. Government Money Market Fund, Premier Class | 5,709 | 5,709 | ||||||
TOTAL TEMPORARY CASH INVESTMENTS (Cost $2,194,946) | 2,194,946 | |||||||
TEMPORARY CASH INVESTMENTS - SECURITIES LENDING COLLATERAL(3) — 1.2% | ||||||||
State Street Navigator Securities Lending Government Money Market Portfolio (Cost $18,560,695) | 18,560,695 | 18,560,695 | ||||||
TOTAL INVESTMENT SECURITIES — 100.7% (Cost $1,112,040,757) | 1,615,790,179 | |||||||
OTHER ASSETS AND LIABILITIES — (0.7)% | (10,821,304) | |||||||
TOTAL NET ASSETS — 100.0% | $ | 1,604,968,875 |
12
MARKET SECTOR DIVERSIFICATION | |||||
(as a % of net assets) | |||||
Industrials | 18.8% | ||||
Information Technology | 18.3% | ||||
Consumer Discretionary | 14.8% | ||||
Financials | 13.8% | ||||
Health Care | 12.6% | ||||
Materials | 8.9% | ||||
Consumer Staples | 6.5% | ||||
Communication Services | 3.0% | ||||
Utilities | 1.2% | ||||
Real Estate | 0.9% | ||||
Energy | 0.6% | ||||
Temporary Cash Investments | 0.1% | ||||
Temporary Cash Investments - Securities Lending Collateral | 1.2% | ||||
Other Assets and Liabilities | (0.7)% |
NOTES TO SCHEDULE OF INVESTMENTS | ||||||||
ADR | - | American Depositary Receipt |
(1)Non-income producing.
(2)Security, or a portion thereof, is on loan. At the period end, the aggregate value of securities on loan was $30,671,101. The amount of securities on loan indicated may not correspond with the securities on loan identified because securities with pending sales are in the process of recall from the brokers.
(3)Investment of cash collateral from securities on loan. At the period end, the aggregate value of the collateral held by the fund was $31,903,083, which includes securities collateral of $13,342,388.
See Notes to Financial Statements.
13
Statement of Assets and Liabilities |
NOVEMBER 30, 2021 | |||||
Assets | |||||
Investment securities, at value (cost of $1,093,480,062) — including $30,671,101 of securities on loan | $ | 1,597,229,484 | |||
Investment made with cash collateral received for securities on loan, at value (cost of $18,560,695) | 18,560,695 | ||||
Total investment securities, at value (cost of $1,112,040,757) | 1,615,790,179 | ||||
Cash | 1,804 | ||||
Foreign currency holdings, at value (cost of $64,035) | 64,386 | ||||
Receivable for investments sold | 6,897,212 | ||||
Receivable for capital shares sold | 156,260 | ||||
Dividends and interest receivable | 3,646,750 | ||||
Securities lending receivable | 2,985 | ||||
Other assets | 64,268 | ||||
1,626,623,844 | |||||
Liabilities | |||||
Payable for collateral received for securities on loan | 18,560,695 | ||||
Payable for investments purchased | 111 | ||||
Payable for capital shares redeemed | 631,213 | ||||
Accrued management fees | 1,597,209 | ||||
Distribution and service fees payable | 23,610 | ||||
Accrued foreign taxes | 692,245 | ||||
Accrued other expenses | 149,886 | ||||
21,654,969 | |||||
Net Assets | $ | 1,604,968,875 | |||
Net Assets Consist of: | |||||
Capital (par value and paid-in surplus) | $ | 923,355,742 | |||
Distributable earnings | 681,613,133 | ||||
$ | 1,604,968,875 |
Net Assets | Shares Outstanding | Net Asset Value Per Share | |||||||||
Investor Class, $0.01 Par Value | $1,163,802,554 | 71,669,293 | $16.24 | ||||||||
I Class, $0.01 Par Value | $265,247,764 | 16,448,333 | $16.13 | ||||||||
Y Class, $0.01 Par Value | $47,542,397 | 2,944,479 | $16.15 | ||||||||
A Class, $0.01 Par Value | $87,966,699 | 5,394,513 | $16.31* | ||||||||
C Class, $0.01 Par Value | $1,462,256 | 94,891 | $15.41 | ||||||||
R Class, $0.01 Par Value | $7,588,871 | 462,855 | $16.40 | ||||||||
R5 Class, $0.01 Par Value | $8,826 | 547 | $16.14 | ||||||||
R6 Class, $0.01 Par Value | $31,349,508 | 1,942,904 | $16.14 |
*Maximum offering price $17.31 (net asset value divided by 0.9425).
See Notes to Financial Statements.
14
Statement of Operations |
YEAR ENDED NOVEMBER 30, 2021 | |||||
Investment Income (Loss) | |||||
Income: | |||||
Dividends (net of foreign taxes withheld of $3,408,529) | $ | 27,816,311 | |||
Securities lending, net | 742,059 | ||||
Interest | 245,594 | ||||
28,803,964 | |||||
Expenses: | |||||
Management fees | 18,750,860 | ||||
Distribution and service fees: | |||||
A Class | 225,542 | ||||
C Class | 17,170 | ||||
R Class | 37,475 | ||||
Directors' fees and expenses | 41,120 | ||||
Other expenses | 217,662 | ||||
19,289,829 | |||||
Net investment income (loss) | 9,514,135 | ||||
Realized and Unrealized Gain (Loss) | |||||
Net realized gain (loss) on: | |||||
Investment transactions (net of foreign tax expenses paid (refunded) of $30,911) | 190,402,045 | ||||
Foreign currency translation transactions | (649,620) | ||||
189,752,425 | |||||
Change in net unrealized appreciation (depreciation) on: | |||||
Investments (includes (increase) decrease in accrued foreign taxes of $153,076) | (37,921,463) | ||||
Translation of assets and liabilities in foreign currencies | (93,292) | ||||
(38,014,755) | |||||
Net realized and unrealized gain (loss) | 151,737,670 | ||||
Net Increase (Decrease) in Net Assets Resulting from Operations | $ | 161,251,805 |
See Notes to Financial Statements.
15
Statement of Changes in Net Assets |
YEARS ENDED NOVEMBER 30, 2021 AND NOVEMBER 30, 2020 | ||||||||
Increase (Decrease) in Net Assets | November 30, 2021 | November 30, 2020 | ||||||
Operations | ||||||||
Net investment income (loss) | $ | 9,514,135 | $ | 1,014,690 | ||||
Net realized gain (loss) | 189,752,425 | 63,609,780 | ||||||
Change in net unrealized appreciation (depreciation) | (38,014,755) | 238,837,670 | ||||||
Net increase (decrease) in net assets resulting from operations | 161,251,805 | 303,462,140 | ||||||
Distributions to Shareholders | ||||||||
From earnings: | ||||||||
Investor Class | (54,887,728) | (4,906,875) | ||||||
I Class | (3,793,173) | (471,463) | ||||||
Y Class | (1,442,300) | (151,818) | ||||||
A Class | (3,664,774) | (231,840) | ||||||
C Class | (85,443) | (9,443) | ||||||
R Class | (292,738) | (19,202) | ||||||
R5 Class | (508) | (40) | ||||||
R6 Class | (2,636,516) | (297,497) | ||||||
Decrease in net assets from distributions | (66,803,180) | (6,088,178) | ||||||
Capital Share Transactions | ||||||||
Net increase (decrease) in net assets from capital share transactions (Note 5) | 10,990,793 | (167,936,818) | ||||||
Net increase (decrease) in net assets | 105,439,418 | 129,437,144 | ||||||
Net Assets | ||||||||
Beginning of period | 1,499,529,457 | 1,370,092,313 | ||||||
End of period | $ | 1,604,968,875 | $ | 1,499,529,457 |
See Notes to Financial Statements.
16
Notes to Financial Statements |
NOVEMBER 30, 2021
1. Organization
American Century World Mutual Funds, Inc. (the corporation) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company and is organized as a Maryland corporation. International Growth Fund (the fund) is one fund in a series issued by the corporation. The fund's investment objective is to seek capital growth.
The fund offers the Investor Class, I Class, Y Class, A Class, C Class, R Class, R5 Class and R6 Class. The A Class may incur an initial sales charge. The A Class and C Class may be subject to a contingent deferred sales charge.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently followed by the fund in preparation of its financial statements. The fund is an investment company and follows accounting and reporting guidance in accordance with accounting principles generally accepted in the United States of America. This may require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from these estimates. Management evaluated the impact of events or transactions occurring through the date the financial statements were issued that would merit recognition or disclosure.
Investment Valuations — The fund determines the fair value of its investments and computes its net asset value (NAV) per share at the close of regular trading (usually 4 p.m. Eastern time) on the New York Stock Exchange (NYSE) on each day the NYSE is open. The Board of Directors has adopted valuation policies and procedures to guide the investment advisor in the fund’s investment valuation process and to provide methodologies for the oversight of the fund’s pricing function.
Equity securities that are listed or traded on a domestic securities exchange are valued at the last reported sales price or at the official closing price as provided by the exchange. Equity securities traded on foreign securities exchanges are generally valued at the closing price of such securities on the exchange where primarily traded or at the close of the NYSE, if that is earlier. If no last sales price is reported, or if local convention or regulation so provides, the mean of the latest bid and asked prices may be used. Securities traded over-the-counter are valued at the mean of the latest bid and asked prices, the last sales price, or the official closing price. Equity securities initially expressed in local currencies are translated into U.S. dollars at the mean of the appropriate currency exchange rate at the close of the NYSE as provided by an independent pricing service.
Open-end management investment companies are valued at the reported NAV per share. Repurchase agreements are valued at cost, which approximates fair value.
If the fund determines that the market price for an investment is not readily available or the valuation methods mentioned above do not reflect an investment’s fair value, such investment is valued as determined in good faith by the Board of Directors or its delegate, in accordance with policies and procedures adopted by the Board of Directors. In its determination of fair value, the fund may review several factors including, but not limited to, market information regarding the specific investment or comparable investments and correlation with other investment types, futures indices or general market indicators. Circumstances that may cause the fund to use these procedures to value an investment include, but are not limited to: an investment has been declared in default or is distressed; trading in a security has been suspended during the trading day or a security is not actively trading on its principal exchange; prices received from a regular pricing source are deemed unreliable; or there is a foreign market holiday and no trading occurred.
17
The fund monitors for significant events occurring after the close of an investment’s primary exchange but before the fund’s NAV per share is determined. Significant events may include, but are not limited to: corporate announcements and transactions; governmental action and political unrest that could impact a specific investment or an investment sector; or armed conflicts, natural disasters and similar events that could affect investments in a specific country or region. The fund also monitors for significant fluctuations between domestic and foreign markets, as evidenced by the U.S. market or such other indicators that the Board of Directors, or its delegate, deems appropriate. The fund may apply a model-derived factor to the closing price of equity securities traded on foreign securities exchanges. The factor is based on observable market data as provided by an independent pricing service.
Security Transactions — Security transactions are accounted for as of the trade date. Net realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes. Certain countries impose taxes on realized gains on the sale of securities registered in their country. The fund records the foreign tax expense, if any, on an accrual basis. The foreign tax expense on realized gains and unrealized appreciation reduces the net realized gain (loss) on investment transactions and net unrealized appreciation (depreciation) on investments, respectively.
Investment Income — Dividend income less foreign taxes withheld, if any, is recorded as of the ex-dividend date. Distributions received on securities that represent a return of capital or long-term capital gain are recorded as a reduction of cost of investments and/or as a realized gain. The fund may estimate the components of distributions received that may be considered nontaxable distributions or long-term capital gain distributions for income tax purposes. Interest income is recorded on the accrual basis and includes accretion of discounts and amortization of premiums. Securities lending income is net of fees and rebates earned by the lending agent for its services.
Foreign Currency Translations — All assets and liabilities initially expressed in foreign currencies are translated into U.S. dollars at prevailing exchange rates at period end. The fund may enter into spot foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of investment securities, dividend and interest income, spot foreign currency exchange contracts, and expenses are translated at the rates of exchange prevailing on the respective dates of such transactions. Net realized and unrealized foreign currency exchange gains or losses related to investment securities are a component of net realized gain (loss) on investment transactions and change in net unrealized appreciation (depreciation) on investments, respectively.
Repurchase Agreements — The fund may enter into repurchase agreements with institutions that American Century Investment Management, Inc. (ACIM) (the investment advisor) has determined are creditworthy pursuant to criteria adopted by the Board of Directors. The fund requires that the collateral, represented by securities, received in a repurchase transaction be transferred to the custodian in a manner sufficient to enable the fund to obtain those securities in the event of a default under the repurchase agreement. ACIM monitors, on a daily basis, the securities transferred to ensure the value, including accrued interest, of the securities under each repurchase agreement is equal to or greater than amounts owed to the fund under each repurchase agreement.
Joint Trading Account — Pursuant to an Exemptive Order issued by the Securities and Exchange Commission, the fund, along with certain other funds in the American Century Investments family of funds, may transfer uninvested cash balances into a joint trading account. These balances are invested in one or more repurchase agreements that are collateralized by U.S. Treasury or Agency obligations.
Segregated Assets — In accordance with the 1940 Act, the fund segregates assets on its books and records to cover certain types of investment securities and other financial instruments. ACIM monitors, on a daily basis, the securities segregated to ensure the fund designates a sufficient amount of liquid assets, marked-to-market daily. The fund may also receive assets or be required to pledge assets at the custodian bank or with a broker for collateral requirements.
18
Income Tax Status — It is the fund’s policy to distribute substantially all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code. Accordingly, no provision has been made for income taxes. The fund files U.S. federal, state, local and non-U.S. tax returns as applicable. The fund's tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years from the date of filing but can be longer in certain jurisdictions. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Multiple Class — All shares of the fund represent an equal pro rata interest in the net assets of the class to which such shares belong, and have identical voting, dividend, liquidation and other rights and the same terms and conditions, except for class specific expenses and exclusive rights to vote on matters affecting only individual classes. Income, non-class specific expenses, and realized and unrealized capital gains and losses of the fund are allocated to each class of shares based on their relative net assets.
Distributions to Shareholders — Distributions from net investment income and net realized gains, if any, are generally declared and paid annually. The fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code, in all events in a manner consistent with provisions of the 1940 Act. The fund may elect to treat a portion of its payment to a redeeming shareholder, which represents the pro rata share of undistributed net investment income and net realized gains, as a distribution for federal income tax purposes (tax equalization).
Indemnifications — Under the corporation’s organizational documents, its officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business, the fund enters into contracts that provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against a fund. The risk of material loss from such claims is considered by management to be remote.
Securities Lending — Securities are lent to qualified financial institutions and brokers. State Street Bank & Trust Co. serves as securities lending agent to the fund pursuant to a Securities Lending Agreement. The lending of securities exposes the fund to risks such as: the borrowers may fail to return the loaned securities, the borrowers may not be able to provide additional collateral, the fund may experience delays in recovery of the loaned securities or delays in access to collateral, or the fund may experience losses related to the investment collateral. To minimize certain risks, loan counterparties pledge collateral in the form of cash and/or securities. The lending agent has agreed to indemnify the fund in the case of default of any securities borrowed. Cash collateral received is invested in the State Street Navigator Securities Lending Government Money Market Portfolio, a money market mutual fund registered under the 1940 Act. The loans may also be secured by U.S. government securities in an amount at least equal to the market value of the securities loaned, plus accrued interest and dividends, determined on a daily basis and adjusted accordingly. By lending securities, the fund seeks to increase its net investment income through the receipt of interest and fees. Such income is reflected separately within the Statement of Operations. The value of loaned securities and related collateral outstanding at period end, if any, are shown on a gross basis within the Schedule of Investments and Statement of Assets and Liabilities.
The following table reflects a breakdown of transactions accounted for as secured borrowings, the gross obligation by the type of collateral pledged, and the remaining contractual maturity of those transactions as of November 30, 2021.
Remaining Contractual Maturity of Agreements | |||||||||||||||||
Overnight and Continuous | <30 days | Between 30 & 90 days | >90 days | Total | |||||||||||||
Securities Lending Transactions(1) | |||||||||||||||||
Common Stocks | $ | 18,560,695 | — | — | — | $ | 18,560,695 | ||||||||||
Gross amount of recognized liabilities for securities lending transactions | $ | 18,560,695 |
(1)Amount represents the payable for cash collateral received for securities on loan. This will generally be in the Overnight and Continuous column as the securities are typically callable on demand.
19
3. Fees and Transactions with Related Parties
Certain officers and directors of the corporation are also officers and/or directors of American Century Companies, Inc. (ACC). The corporation’s investment advisor, ACIM, the corporation's distributor, American Century Investment Services, Inc. (ACIS), and the corporation’s transfer agent, American Century Services, LLC, are wholly owned, directly or indirectly, by ACC. Various funds issued by American Century Asset Allocation Portfolios, Inc. own, in aggregate, 18% of the shares of the fund.
Management Fees — The corporation has entered into a management agreement with ACIM, under which ACIM provides the fund with investment advisory and management services in exchange for a single, unified management fee (the fee) per class. The agreement provides that ACIM will pay all expenses of managing and operating the fund, except brokerage expenses, taxes, interest, fees and expenses of the independent directors (including legal counsel fees), extraordinary expenses, and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the 1940 Act. The fee is computed and accrued daily based on each class's daily net assets and paid monthly in arrears. The difference in the fee among the classes is a result of their separate arrangements for non-Rule 12b-1 shareholder services. It is not the result of any difference in advisory or custodial fees or other expenses related to the management of the fund’s assets, which do not vary by class. The rate of the fee is determined by applying a fee rate calculation formula. This formula takes into account the fund’s assets as well as certain assets, if any, of other clients of the investment advisor outside the American Century Investments family of funds (such as subadvised funds and separate accounts) that use very similar investment teams and strategies (strategy assets). The strategy assets of the fund also include the assets of NT International Growth Fund, one fund in a series issued by the corporation.
The management fee schedule range and the effective annual management fee for each class for the period ended November 30, 2021 are as follows:
Management Fee Schedule Range | Effective Annual Management Fee | |||||||
Investor Class | 1.050% to 1.500% | 1.19% | ||||||
I Class | 0.850% to 1.300% | 0.99% | ||||||
Y Class | 0.700% to 1.150% | 0.84% | ||||||
A Class | 1.050% to 1.500% | 1.19% | ||||||
C Class | 1.050% to 1.500% | 1.19% | ||||||
R Class | 1.050% to 1.500% | 1.19% | ||||||
R5 Class | 0.850% to 1.300% | 0.99% | ||||||
R6 Class | 0.700% to 1.150% | 0.84% |
Distribution and Service Fees — The Board of Directors has adopted a separate Master Distribution and Individual Shareholder Services Plan for each of the A Class, C Class and R Class (collectively the plans), pursuant to Rule 12b-1 of the 1940 Act. The plans provide that the A Class will pay ACIS an annual distribution and service fee of 0.25%. The plans provide that the C Class will pay ACIS an annual distribution and service fee of 1.00%, of which 0.25% is paid for individual shareholder services and 0.75% is paid for distribution services. The plans provide that the R Class will pay ACIS an annual distribution and service fee of 0.50%. The fees are computed and accrued daily based on each class’s daily net assets and paid monthly in arrears. The fees are used to pay financial intermediaries for distribution and individual shareholder services. Fees incurred under the plans during the period ended November 30, 2021 are detailed in the Statement of Operations.
Directors' Fees and Expenses — The Board of Directors is responsible for overseeing the investment advisor’s management and operations of the fund. The directors receive detailed information about the fund and its investment advisor regularly throughout the year, and meet at least quarterly with management of the investment advisor to review reports about fund operations. The fund’s officers do not receive compensation from the fund.
Interfund Transactions — The fund may enter into security transactions with other American Century Investments funds and other client accounts of the investment advisor, in accordance with the 1940 Act rules and procedures adopted by the Board of Directors. The rules and procedures require, among other things, that these transactions be effected at the independent current market price of the security. During the period, the interfund purchases and sales were $337,760 and $229,764, respectively. The effect of interfund transactions on the Statement of Operations was $(4,433) in net realized gain (loss) on investment transactions.
20
4. Investment Transactions
Purchases and sales of investment securities, excluding short-term investments, for the period ended November 30, 2021 were $811,706,975 and $830,456,826, respectively.
5. Capital Share Transactions
Transactions in shares of the fund were as follows:
Year ended November 30, 2021 | Year ended November 30, 2020 | |||||||||||||
Shares | Amount | Shares | Amount | |||||||||||
Investor Class/Shares Authorized | 1,250,000,000 | 1,250,000,000 | ||||||||||||
Sold | 3,665,315 | $ | 58,740,896 | 3,240,677 | $ | 38,156,109 | ||||||||
Issued in reinvestment of distributions | 3,482,032 | 52,071,101 | 379,819 | 4,748,521 | ||||||||||
Redeemed | (16,617,751) | (272,378,978) | (16,638,244) | (211,154,875) | ||||||||||
(9,470,404) | (161,566,981) | (13,017,748) | (168,250,245) | |||||||||||
I Class/Shares Authorized | 90,000,000 | 90,000,000 | ||||||||||||
Sold | 12,662,682 | 207,549,688 | 1,092,403 | 13,679,290 | ||||||||||
Issued in reinvestment of distributions | 255,045 | 3,782,314 | 36,444 | 453,353 | ||||||||||
Redeemed | (1,870,098) | (30,347,473) | (1,813,504) | (22,006,067) | ||||||||||
11,047,629 | 180,984,529 | (684,657) | (7,873,424) | |||||||||||
Y Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 1,176,218 | 19,132,223 | 889,212 | 11,191,681 | ||||||||||
Issued in reinvestment of distributions | 96,900 | 1,437,024 | 12,036 | 149,903 | ||||||||||
Redeemed | (251,076) | (4,054,144) | (500,101) | (6,593,043) | ||||||||||
1,022,042 | 16,515,103 | 401,147 | 4,748,541 | |||||||||||
A Class/Shares Authorized | 80,000,000 | 80,000,000 | ||||||||||||
Sold | 729,932 | 11,666,426 | 1,149,517 | 14,501,908 | ||||||||||
Issued in reinvestment of distributions | 238,591 | 3,593,178 | 18,170 | 228,255 | ||||||||||
Redeemed | (833,309) | (13,500,921) | (1,359,112) | (17,240,766) | ||||||||||
135,214 | 1,758,683 | (191,425) | (2,510,603) | |||||||||||
C Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 4,351 | 66,796 | 12,823 | 149,256 | ||||||||||
Issued in reinvestment of distributions | 5,736 | 82,198 | 695 | 8,410 | ||||||||||
Redeemed | (41,265) | (633,724) | (112,520) | (1,326,676) | ||||||||||
(31,178) | (484,730) | (99,002) | (1,169,010) | |||||||||||
R Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 89,795 | 1,458,492 | 73,216 | 960,881 | ||||||||||
Issued in reinvestment of distributions | 19,165 | 290,918 | 1,499 | 19,053 | ||||||||||
Redeemed | (77,433) | (1,265,365) | (126,035) | (1,616,452) | ||||||||||
31,527 | 484,045 | (51,320) | (636,518) | |||||||||||
R5 Class/Shares Authorized | 20,000,000 | 20,000,000 | ||||||||||||
Sold | 21 | 313 | 189 | 2,856 | ||||||||||
Issued in reinvestment of distributions | 25 | 372 | 3 | 40 | ||||||||||
Redeemed | (210) | (3,192) | — | — | ||||||||||
(164) | (2,507) | 192 | 2,896 | |||||||||||
R6 Class/Shares Authorized | 50,000,000 | 50,000,000 | ||||||||||||
Sold | 1,485,610 | 23,290,435 | 1,715,636 | 21,568,793 | ||||||||||
Issued in reinvestment of distributions | 176,481 | 2,615,452 | 23,795 | 296,197 | ||||||||||
Redeemed | (3,339,362) | (52,603,236) | (1,139,714) | (14,113,445) | ||||||||||
(1,677,271) | (26,697,349) | 599,717 | 7,751,545 | |||||||||||
Net increase (decrease) | 1,057,395 | $ | 10,990,793 | (13,043,096) | $ | (167,936,818) |
21
6. Fair Value Measurements
The fund’s investments valuation process is based on several considerations and may use multiple inputs to determine the fair value of the investments held by the fund. In conformity with accounting principles generally accepted in the United States of America, the inputs used to determine a valuation are classified into three broad levels.
•Level 1 valuation inputs consist of unadjusted quoted prices in an active market for identical investments.
•Level 2 valuation inputs consist of direct or indirect observable market data (including quoted prices for comparable investments, evaluations of subsequent market events, interest rates, prepayment speeds, credit risk, etc.). These inputs also consist of quoted prices for identical investments initially expressed in local currencies that are adjusted through translation into U.S. dollars.
•Level 3 valuation inputs consist of unobservable data (including a fund’s own assumptions).
The level classification is based on the lowest level input that is significant to the fair valuation measurement. The valuation inputs are not necessarily an indication of the risks associated with investing in these securities or other financial instruments.
The following is a summary of the level classifications as of period end. The Schedule of Investments provides additional information on the fund’s portfolio holdings.
Level 1 | Level 2 | Level 3 | |||||||||
Assets | |||||||||||
Investment Securities | |||||||||||
Common Stocks | |||||||||||
Australia | $ | 19,478,322 | $ | 42,355,702 | — | ||||||
Canada | 18,137,793 | 66,293,896 | — | ||||||||
Ireland | 33,849,982 | 22,249,469 | — | ||||||||
Israel | 15,473,185 | — | — | ||||||||
Singapore | 9,281,615 | — | — | ||||||||
Switzerland | 7,530,402 | 122,335,389 | — | ||||||||
Other Countries | — | 1,238,048,783 | — | ||||||||
Temporary Cash Investments | 5,709 | 2,189,237 | — | ||||||||
Temporary Cash Investments - Securities Lending Collateral | 18,560,695 | — | — | ||||||||
$ | 122,317,703 | $ | 1,493,472,476 | — |
7. Risk Factors
The value of the fund’s shares will go up and down, sometimes rapidly or unpredictably, based on the performance of the securities owned by the fund and other factors generally affecting the securities market. Market risks, including political, regulatory, economic and social developments, can affect the value of the fund’s investments. Natural disasters, public health emergencies, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse long-term effects on world economies and markets generally.
There are certain risks involved in investing in foreign securities. These risks include those resulting from political events (such as civil unrest, national elections and imposition of exchange controls), social and economic events (such as labor strikes and rising inflation), and natural disasters. Securities of foreign issuers may be less liquid and more volatile. Investing in emerging markets or a significant portion of assets in one country or region may accentuate these risks.
22
8. Federal Tax Information
On December 21, 2021, the fund declared and paid a per-share distribution from net realized gains to shareholders of record on December 20, 2021 of $1.6684 for the Investor Class, I Class, Y Class, A Class, C Class, R Class, R5 Class and R6 Class.
On December 21, 2021, the fund declared and paid the following per-share distributions from net investment income to shareholders of record on December 20, 2021:
Investor Class | I Class | Y Class | A Class | C Class | R Class | R5 Class | R6 Class | ||||||||||||||||
$0.1044 | $0.1361 | $0.1599 | $0.0647 | — | $0.0251 | $0.1361 | $0.1599 |
The tax character of distributions paid during the years ended November 30, 2021 and November 30, 2020 were as follows:
2021 | 2020 | |||||||
Distributions Paid From | ||||||||
Ordinary income | $ | 708,165 | $ | 1,443,053 | ||||
Long-term capital gains | $ | 66,095,015 | $ | 4,645,125 |
The book-basis character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements.
The reclassifications, which are primarily due to tax equalization, were made to capital $16,876,176 and distributable earnings $(16,876,176).
As of period end, the federal tax cost of investments and the components of distributable earnings on a tax-basis were as follows:
Federal tax cost of investments | $ | 1,113,021,879 | |||
Gross tax appreciation of investments | $ | 524,391,923 | |||
Gross tax depreciation of investments | (21,623,623) | ||||
Net tax appreciation (depreciation) of investments | 502,768,300 | ||||
Net tax appreciation (depreciation) on translation of assets and liabilities in foreign currencies | (669,308) | ||||
Net tax appreciation (depreciation) | $ | 502,098,992 | |||
Undistributed ordinary income | $ | 17,916,618 | |||
Accumulated long-term gains | $ | 161,597,523 |
The difference between book-basis and tax-basis unrealized appreciation (depreciation) is attributable primarily to the tax deferral of losses on wash sales.
23
Financial Highlights |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Net Investment Income (Loss) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||
Investor Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $15.32 | 0.09 | 1.51 | 1.60 | —(3) | (0.68) | (0.68) | $16.24 | 10.83% | 1.21% | 0.56% | 51% | $1,163,803 | ||||||||||||||||||||||||||||
2020 | $12.35 | 0.01 | 3.01 | 3.02 | (0.01) | (0.04) | (0.05) | $15.32 | 24.57% | 1.18% | 0.06% | 51% | $1,243,217 | ||||||||||||||||||||||||||||
2019 | $11.83 | 0.05 | 1.66 | 1.71 | (0.12) | (1.07) | (1.19) | $12.35 | 16.82% | 1.18% | 0.43% | 68% | $1,162,998 | ||||||||||||||||||||||||||||
2018 | $13.80 | 0.08 | (1.28) | (1.20) | (0.13) | (0.64) | (0.77) | $11.83 | (9.23)% | 1.17% | 0.62% | 69% | $1,173,094 | ||||||||||||||||||||||||||||
2017 | $10.56 | 0.10 | 3.19 | 3.29 | (0.05) | — | (0.05) | $13.80 | 31.32% | 1.17% | 0.80% | 57% | $1,357,353 | ||||||||||||||||||||||||||||
I Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $15.22 | 0.14 | 1.48 | 1.62 | (0.03) | (0.68) | (0.71) | $16.13 | 11.07% | 1.01% | 0.76% | 51% | $265,248 | ||||||||||||||||||||||||||||
2020 | $12.27 | 0.03 | 3.00 | 3.03 | (0.04) | (0.04) | (0.08) | $15.22 | 24.82% | 0.98% | 0.26% | 51% | $82,222 | ||||||||||||||||||||||||||||
2019 | $11.76 | 0.07 | 1.66 | 1.73 | (0.15) | (1.07) | (1.22) | $12.27 | 17.09% | 0.98% | 0.63% | 68% | $74,688 | ||||||||||||||||||||||||||||
2018 | $13.74 | 0.10 | (1.28) | (1.18) | (0.16) | (0.64) | (0.80) | $11.76 | (9.12)% | 0.97% | 0.82% | 69% | $67,677 | ||||||||||||||||||||||||||||
2017 | $10.51 | 0.13 | 3.17 | 3.30 | (0.07) | — | (0.07) | $13.74 | 31.64% | 0.97% | 1.00% | 57% | $90,679 | ||||||||||||||||||||||||||||
Y Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $15.24 | 0.16 | 1.49 | 1.65 | (0.06) | (0.68) | (0.74) | $16.15 | 11.23% | 0.86% | 0.91% | 51% | $47,542 | ||||||||||||||||||||||||||||
2020 | $12.29 | 0.05 | 2.99 | 3.04 | (0.05) | (0.04) | (0.09) | $15.24 | 24.97% | 0.83% | 0.41% | 51% | $29,299 | ||||||||||||||||||||||||||||
2019 | $11.78 | 0.08 | 1.66 | 1.74 | (0.16) | (1.07) | (1.23) | $12.29 | 17.27% | 0.83% | 0.78% | 68% | $18,691 | ||||||||||||||||||||||||||||
2018 | $13.75 | 0.15 | (1.30) | (1.15) | (0.18) | (0.64) | (0.82) | $11.78 | (8.95)% | 0.82% | 0.97% | 69% | $6,177 | ||||||||||||||||||||||||||||
2017(4) | $11.48 | 0.09 | 2.18 | 2.27 | — | — | — | $13.75 | 19.77% | 0.82%(5) | 1.14%(5) | 57%(6) | $6 |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Net Investment Income (Loss) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||
A Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $15.42 | 0.05 | 1.52 | 1.57 | — | (0.68) | (0.68) | $16.31 | 10.53% | 1.46% | 0.31% | 51% | $87,967 | ||||||||||||||||||||||||||||
2020 | $12.45 | (0.02) | 3.03 | 3.01 | — | (0.04) | (0.04) | $15.42 | 24.27% | 1.43% | (0.19)% | 51% | $81,088 | ||||||||||||||||||||||||||||
2019 | $11.91 | 0.02 | 1.69 | 1.71 | (0.10) | (1.07) | (1.17) | $12.45 | 16.56% | 1.43% | 0.18% | 68% | $67,857 | ||||||||||||||||||||||||||||
2018 | $13.88 | 0.05 | (1.29) | (1.24) | (0.09) | (0.64) | (0.73) | $11.91 | (9.45)% | 1.42% | 0.37% | 69% | $64,784 | ||||||||||||||||||||||||||||
2017 | $10.63 | 0.06 | 3.22 | 3.28 | (0.03) | — | (0.03) | $13.88 | 30.88% | 1.42% | 0.55% | 57% | $77,983 | ||||||||||||||||||||||||||||
C Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $14.71 | (0.08) | 1.46 | 1.38 | — | (0.68) | (0.68) | $15.41 | 9.72% | 2.21% | (0.44)% | 51% | $1,462 | ||||||||||||||||||||||||||||
2020 | $11.97 | (0.11) | 2.89 | 2.78 | — | (0.04) | (0.04) | $14.71 | 23.32% | 2.18% | (0.94)% | 51% | $1,855 | ||||||||||||||||||||||||||||
2019 | $11.49 | (0.06) | 1.62 | 1.56 | (0.01) | (1.07) | (1.08) | $11.97 | 15.66% | 2.18% | (0.57)% | 68% | $2,694 | ||||||||||||||||||||||||||||
2018 | $13.42 | (0.04) | (1.25) | (1.29) | — | (0.64) | (0.64) | $11.49 | (10.12)% | 2.17% | (0.38)% | 69% | $4,268 | ||||||||||||||||||||||||||||
2017 | $10.33 | (0.03) | 3.12 | 3.09 | — | — | — | $13.42 | 29.91% | 2.17% | (0.20)% | 57% | $6,743 | ||||||||||||||||||||||||||||
R Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $15.54 | 0.01 | 1.53 | 1.54 | — | (0.68) | (0.68) | $16.40 | 10.25% | 1.71% | 0.06% | 51% | $7,589 | ||||||||||||||||||||||||||||
2020 | $12.58 | (0.06) | 3.06 | 3.00 | — | (0.04) | (0.04) | $15.54 | 24.04% | 1.68% | (0.44)% | 51% | $6,701 | ||||||||||||||||||||||||||||
2019 | $12.02 | (0.01) | 1.71 | 1.70 | (0.07) | (1.07) | (1.14) | $12.58 | 16.17% | 1.68% | (0.07)% | 68% | $6,069 | ||||||||||||||||||||||||||||
2018 | $14.00 | 0.02 | (1.30) | (1.28) | (0.06) | (0.64) | (0.70) | $12.02 | (9.68)% | 1.67% | 0.12% | 69% | $3,226 | ||||||||||||||||||||||||||||
2017 | $10.72 | 0.03 | 3.25 | 3.28 | — | — | — | $14.00 | 30.60% | 1.67% | 0.30% | 57% | $3,609 |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Net Investment Income (Loss) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||
R5 Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $15.23 | 0.11 | 1.51 | 1.62 | (0.03) | (0.68) | (0.71) | $16.14 | 11.06% | 1.01% | 0.76% | 51% | $9 | ||||||||||||||||||||||||||||
2020 | $12.28 | 0.03 | 3.00 | 3.03 | (0.04) | (0.04) | (0.08) | $15.23 | 24.80% | 0.98% | 0.26% | 51% | $11 | ||||||||||||||||||||||||||||
2019 | $11.77 | 0.07 | 1.66 | 1.73 | (0.15) | (1.07) | (1.22) | $12.28 | 17.09% | 0.98% | 0.63% | 68% | $6 | ||||||||||||||||||||||||||||
2018 | $13.73 | 0.11 | (1.27) | (1.16) | (0.16) | (0.64) | (0.80) | $11.77 | (9.03)% | 0.97% | 0.82% | 69% | $5 | ||||||||||||||||||||||||||||
2017(4) | $11.48 | 0.08 | 2.17 | 2.25 | — | — | — | $13.73 | 19.60% | 0.97%(5) | 0.99%(5) | 57%(6) | $6 | ||||||||||||||||||||||||||||
R6 Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $15.23 | 0.14 | 1.51 | 1.65 | (0.06) | (0.68) | (0.74) | $16.14 | 11.23% | 0.86% | 0.91% | 51% | $31,350 | ||||||||||||||||||||||||||||
2020 | $12.28 | 0.05 | 2.99 | 3.04 | (0.05) | (0.04) | (0.09) | $15.23 | 24.99% | 0.83% | 0.41% | 51% | $55,137 | ||||||||||||||||||||||||||||
2019 | $11.77 | 0.09 | 1.65 | 1.74 | (0.16) | (1.07) | (1.23) | $12.28 | 17.28% | 0.83% | 0.78% | 68% | $37,088 | ||||||||||||||||||||||||||||
2018 | $13.75 | 0.14 | (1.29) | (1.15) | (0.19) | (0.64) | (0.83) | $11.77 | (8.93)% | 0.82% | 0.97% | 69% | $38,315 | ||||||||||||||||||||||||||||
2017 | $10.53 | 0.15 | 3.16 | 3.31 | (0.09) | — | (0.09) | $13.75 | 31.68% | 0.82% | 1.15% | 57% | $29,846 |
Notes to Financial Highlights |
(1)Computed using average shares outstanding throughout the period.
(2)Total returns are calculated based on the net asset value of the last business day and do not reflect applicable sales charges, if any. Total returns for periods less than one year are not annualized.
(3)Per-share amount was less than $0.005.
(4)April 10, 2017 (commencement of sale) through November 30, 2017.
(5)Annualized.
(6)Portfolio turnover is calculated at the fund level. Percentage indicated was calculated for the year ended November 30, 2017.
See Notes to Financial Statements.
Report of Independent Registered Public Accounting Firm |
To the Shareholders and the Board of Directors of American Century World Mutual Funds, Inc.:
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of International Growth Fund (the “Fund”), one of the funds constituting the American Century World Mutual Funds, Inc., as of November 30, 2021, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of International Growth Fund of the American Century World Mutual Funds, Inc. as of November 30, 2021, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund’s financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. 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, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of November 30, 2021, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
/s/ Deloitte & Touche LLP
Kansas City, Missouri
January 19, 2022
We have served as the auditor of one or more American Century investment companies since 1997.
27
Management |
The Board of Directors
The individuals listed below serve as directors of the funds. Each director will continue to serve in this capacity until death, retirement, resignation or removal from office. The board has adopted a mandatory retirement age for directors who are not “interested persons,” as that term is defined in the Investment Company Act (independent directors). Independent directors shall retire by December 31 of the year in which they reach their 75th birthday.
Jonathan S. Thomas is an “interested person” because he currently serves as President and Chief Executive Officer of American Century Companies, Inc. (ACC), the parent company of American Century Investment Management, Inc. (ACIM or the advisor). The other directors (more than three-fourths of the total number) are independent. They are not employees, directors or officers of, and have no financial interest in, ACC or any of its wholly owned, direct or indirect, subsidiaries, including ACIM, American Century Investment Services, Inc. (ACIS) and American Century Services, LLC (ACS), and they do not have any other affiliations, positions or relationships that would cause them to be considered “interested persons” under the Investment Company Act. The directors serve in this capacity for seven (in the case of Jonathan S. Thomas, 16; and Stephen E. Yates, 8) registered investment companies in the American Century Investments family of funds.
The following table presents additional information about the directors. The mailing address for each director is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Thomas W. Bunn (1953) | Director | Since 2017 | Retired | 72 | SquareTwo Financial; Barings (formerly Babson Capital Funds Trust) (2013 to 2016) | ||||||||||||
Chris H. Cheesman (1962) | Director | Since 2019 | Retired. Senior Vice President & Chief Audit Executive, AllianceBernstein (1999 to 2018) | 72 | Alleghany Corporation | ||||||||||||
Barry Fink (1955) | Director | Since 2012 (independent since 2016) | Retired | 72 | None | ||||||||||||
Rajesh K. Gupta (1960) | Director | Since 2019 | Partner Emeritus, SeaCrest Investment Management and SeaCrest Wealth Management (2019 to Present); Chief Executive Officer and Chief Investment Officer, SeaCrest Investment Management (2006 to 2019); Chief Executive Officer and Chief Investment Officer, SeaCrest Wealth Management (2008 to 2019) | 72 | None |
28
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Lynn Jenkins (1963) | Director | Since 2019 | Consultant, LJ Strategies (2019 to present); United States Representative, U.S. House of Representatives (2009 to 2018) | 72 | MGP Ingredients, Inc. (2019 to 2021) | ||||||||||||
Jan M. Lewis (1957) | Director | Since 2011 | Retired | 72 | None | ||||||||||||
John R. Whitten(1) (1946) | Director | Since 2008 | Retired | 72 | Onto Innovation Inc. (2019 to 2020); Rudolph Technologies, Inc. (2006 to 2019) | ||||||||||||
Stephen E. Yates (1948) | Director and Chairman of the Board | Since 2012 (Chairman since 2018) | Retired | 108 | None | ||||||||||||
Interested Director | |||||||||||||||||
Jonathan S. Thomas (1963) | Director | Since 2007 | President and Chief Executive Officer, ACC (2007 to present). Also serves as Chief Executive Officer, ACS; Director, ACC and other ACC subsidiaries | 146 | None |
(1) Effective December 31, 2021, John R. Whitten retired from the Board of Directors.
The Statement of Additional Information has additional information about the fund's directors and is available without charge, upon request, by calling 1-800-345-2021.
29
Officers
The following table presents certain information about the executive officers of the funds. Each officer serves as an officer for each of the 16 (in the case of Robert J. Leach, 15) investment companies in the American Century family of funds. No officer is compensated for his or her service as an officer of the funds. The listed officers are interested persons of the funds and are appointed or re-appointed on an annual basis. The mailing address for each officer listed below is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Offices with the Funds | Principal Occupation(s) During the Past Five Years | ||||||
Patrick Bannigan (1965) | President since 2019 | Executive Vice President and Director, ACC (2012 to present); Chief Financial Officer, Chief Accounting Officer and Treasurer, ACC (2015 to present). Also serves as President, ACS; Vice President, ACIM; Chief Financial Officer, Chief Accounting Officer and/or Director, ACIM, ACS and other ACC subsidiaries | ||||||
R. Wes Campbell (1974) | Chief Financial Officer and Treasurer since 2018 | Vice President, ACS, (2020 to present); Investment Operations and Investment Accounting, ACS (2000 to present) | ||||||
Amy D. Shelton (1964) | Chief Compliance Officer and Vice President since 2014 | Chief Compliance Officer, American Century funds, (2014 to present); Chief Compliance Officer, ACIM (2014 to present); Chief Compliance Officer, ACIS (2009 to present). Also serves as Vice President, ACIS | ||||||
John Pak (1968) | General Counsel and Senior Vice President since 2021 | General Counsel and Senior Vice President, ACC (2021 to present). Also serves as General Counsel and Senior Vice President, ACIM, ACS and ACIS. Chief Legal Officer of Investment and Wealth Management, The Bank of New York Mellon (2014 to 2021) | ||||||
C. Jean Wade (1964) | Vice President since 2012 | Senior Vice President, ACS (2017 to present); Vice President, ACS (2000 to 2017) | ||||||
Robert J. Leach (1966) | Vice President since 2006 | Vice President, ACS (2000 to present) | ||||||
David H. Reinmiller (1963) | Vice President since 2000 | Attorney, ACC (1994 to present). Also serves as Vice President, ACIM and ACS | ||||||
Ward D. Stauffer (1960) | Secretary since 2005 | Attorney, ACC (2003 to present) |
30
Approval of Management Agreement |
At a meeting held on June 30, 2021, the Fund’s Board of Directors (the "Board") unanimously approved the renewal of the management agreement pursuant to which American Century Investment Management, Inc. (the “Advisor”) acts as the investment advisor for the Fund. Under Section 15(c) of the Investment Company Act, contracts for investment advisory services are required to be reviewed, evaluated, and approved by a majority of a fund’s directors (the “Directors”), including a majority of the independent Directors, each year.
Prior to its consideration of the renewal of the management agreement, the Directors requested and reviewed extensive data and information compiled by the Advisor and certain independent providers of evaluation data concerning the Fund and the services provided to the Fund by the Advisor. This review was in addition to the oversight and evaluation undertaken by the Board and its committees on a continual basis and the information received was supplemental to the extensive information that the Board and its committees receive and consider throughout the year.
In connection with its consideration of the renewal of the management agreement, the Board’s review and evaluation of the services provided by the Advisor and its affiliates included, but was not limited to, the following:
•the nature, extent, and quality of investment management, shareholder services, and other services provided and to be provided to the Fund including without limitation portfolio management and trading services, shareholder and intermediary services, compliance and legal services, fund accounting and financial reporting, and fund share distribution;
•the wide range of other programs and services provided and to be provided to the Fund and its shareholders on a routine and non-routine basis;
•the Fund’s investment performance, including data comparing the Fund's performance to appropriate benchmarks and/or a peer group of other mutual funds with similar investment objectives and strategies;
•the cost of owning the Fund compared to the cost of owning similar funds;
•the compliance policies, procedures, and regulatory experience of the Advisor and the Fund's service providers;
•the Advisor’s strategic plans, COVID-19 pandemic response, vendor management practices, and social justice initiatives;
•the Advisor’s business continuity plans and cyber security practices;
•financial data showing the cost of services provided to the Fund, the profitability of the Fund to the Advisor, and the overall profitability of the Advisor;
•possible economies of scale associated with the Advisor’s management of the Fund and other accounts;
•services provided and charges to the Advisor's other investment management clients;
•acquired fund fees and expenses;
•payments and practices in connection with financial intermediaries holding shares of the Fund and the services provided by intermediaries in connection therewith; and
•possible collateral benefits to the Advisor from the management of the Fund.
The Board held two meetings to consider the renewal. The independent Directors also met in private session three times to review and discuss the information provided in response to their request. The independent Directors held active discussions with the Advisor regarding the renewal of the management agreement, requesting supplemental information, and reviewing information provided by the Advisor in response thereto. The independent Directors had the benefit of the advice of their independent counsel throughout the process.
31
Factors Considered
The Directors considered all of the information provided by the Advisor, the independent data providers, and independent counsel in connection with the approval. They determined that the information was sufficient for them to evaluate the management agreement for the Fund. In connection with their review, the Directors did not identify any single factor as being all-important or controlling, and each Director may have attributed different levels of importance to different factors. In deciding to renew the management agreement, the Board based its decision on a number of factors, including without limitation the following:
Nature, Extent and Quality of Services — Generally. Under the management agreement, the Advisor is responsible for providing or arranging for all services necessary for the operation of the Fund. The Board noted that the Advisor provides or arranges at its own expense a wide variety of services which include the following:
•constructing and designing the Fund
•portfolio research and security selection
•initial capitalization/funding
•securities trading
•Fund administration
•custody of Fund assets
•daily valuation of the Fund’s portfolio
•liquidity monitoring and management
•risk management, including cyber security
•shareholder servicing and transfer agency, including shareholder confirmations, recordkeeping, and communications
•legal services (except the independent Directors’ counsel)
•regulatory and portfolio compliance
•financial reporting
•marketing and distribution (except amounts paid by the Fund under Rule 12b-1 plans)
The Board noted that many of these services have expanded over time in terms of both quantity and complexity in response to shareholder demands, competition in the industry, changing distribution channels, and the changing regulatory environment.
Investment Management Services. The nature of the investment management services provided to the Fund is quite complex and allows Fund shareholders access to professional money management, instant diversification of their investments within an asset class, the opportunity to easily diversify among asset classes by investing in or exchanging among various American Century Investments funds, and liquidity. In evaluating investment performance, the Board expects the Advisor to manage the Fund in accordance with its investment objectives and approved strategies. Further, the Directors recognize that the Advisor has an obligation to monitor trading activities, and in particular to seek the best execution of fund trades, and to evaluate the use of and payment for research. In providing these services, the Advisor utilizes teams of investment professionals (portfolio managers, analysts, research assistants, and securities traders) who require extensive information technology, research, training, compliance, and other systems to conduct their business. The Board, directly and through its Fund Performance Review Committee, provides oversight of the investment performance process. It regularly reviews investment performance information for the Fund, together with comparative information for appropriate benchmarks and/or peer groups of similarly-managed funds, over different time horizons. The Directors also review investment performance information during the management agreement renewal process. If performance concerns are identified, the Fund receives special reviews until performance improves, during which the Board discusses with the Advisor the reasons for such results (e.g., market conditions, security selection) and any efforts being undertaken to improve performance. The Fund’s performance was above its benchmark for the one-, three-, five-, and ten-year periods reviewed by the Board. The Board found the investment management services provided by the Advisor to the Fund to be satisfactory and consistent with the management agreement.
32
Shareholder and Other Services. Under the management agreement, the Advisor provides the Fund with a comprehensive package of transfer agency, shareholder, and other services. The Board, directly and through its various committees, regularly reviews reports and evaluations of such services at its regular meetings. These reports include, but are not limited to, information regarding the operational efficiency and accuracy of the shareholder and transfer agency services provided, staffing levels, shareholder satisfaction, technology support (including cyber security), new products and services offered to Fund shareholders, securities trading activities, portfolio valuation services, auditing services, and legal and operational compliance activities. The Board found the services provided by the Advisor to the Fund under the management agreement to be competitive and of high quality.
Costs of Services and Profitability. The Advisor provides detailed information concerning its cost of providing various services to the Fund, its profitability in managing the Fund (pre- and post-distribution), its overall profitability, and its financial condition. The Directors have reviewed with the Advisor the methodology used to prepare this financial information. This information is considered in evaluating the Advisor’s financial condition, its ability to continue to provide services under the management agreement, and the reasonableness of the current management fee. The Board concluded that the Advisor’s profits were reasonable in light of the services provided to the Fund.
Ethics. The Board generally considers the Advisor’s commitment to providing quality services to shareholders and to conducting its business ethically. They noted that the Advisor’s practices generally meet or exceed industry best practices.
Economies of Scale. The Board also reviewed information provided by the Advisor regarding the possible existence of economies of scale in connection with the management of the Fund. The Board concluded that economies of scale are difficult to measure and predict with precision, especially on a fund-by-fund basis. The Board concluded that the Advisor is sharing economies of scale, to the extent they exist, through its competitive fee structure, offering competitive fees from fund inception, and through reinvestment in its business, infrastructure, investment capabilities and initiatives to provide shareholders additional content and services. The Board also noted that economies of scale are shared with the Fund and its shareholders through management fee breakpoints that serve to reduce the effective management fee as the assets of the Fund grow.
Comparison to Other Funds’ Fees. The management agreement provides that the Fund pays the Advisor a single, all-inclusive (or unified) management fee for providing all services necessary for the management and operation of the Fund, other than brokerage expenses, expenses attributable to short sales, taxes, interest, extraordinary expenses, fees and expenses of the Fund’s independent Directors (including their independent legal counsel), and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the Investment Company Act. Under the unified fee structure, the Advisor is responsible for providing all investment advisory, custody, audit, administrative, compliance, recordkeeping, marketing and shareholder services, or arranging and supervising third parties to provide such services. By contrast, most other funds are charged a variety of fees, including an investment advisory fee, a transfer agency fee, an administrative fee, distribution charges, and other expenses. Other than their investment advisory fees and any applicable Rule 12b-1 distribution fees, all other components of the total fees charged by these other funds may be increased without shareholder approval. The Board believes the unified fee structure is a benefit to Fund shareholders because it clearly discloses to shareholders the cost of owning Fund shares, and, since the unified fee cannot be increased without a vote of Fund shareholders, it shifts to the Advisor the risk of increased costs of operating the Fund and provides a direct incentive to minimize administrative inefficiencies. Part of the Board’s analysis of fee levels involves reviewing certain evaluative data compiled by an independent provider comparing the Fund’s unified fee to the total expense ratios of its peers. The unified fee charged to shareholders of the Fund was below the median of the total expense ratios of the Fund’s peer expense universe. In addition, the Board reviewed the Fund’s position relative to the narrower set of its expense group peers. The Board concluded that the management fee paid by the Fund to the Advisor under the management agreement is reasonable in light of the services provided to the Fund.
33
Comparison to Fees and Services Provided to Other Clients of the Advisor. The Board also requested and received information from the Advisor concerning the nature of the services, fees, costs, and profitability of its advisory services to advisory clients other than the Fund. They observed that these varying types of client accounts require different services and involve different regulatory and entrepreneurial risks than the management of the Fund. The Board analyzed this information and concluded that the fees charged and services provided to the Fund were reasonable by comparison.
Payments to Intermediaries. The Directors also requested and received a description of payments made to intermediaries by the Fund and the Advisor and services provided in response thereto. These payments include various payments made by the Fund or the Advisor to different types of intermediaries and recordkeepers for distribution and service activities provided for the Fund. The Directors reviewed such information and received representations from the Advisor that all such payments by the Fund were made pursuant to the Fund's Rule 12b-1 Plan and that all such payments by the Advisor were made from the Advisor’s resources and reasonable profits. The Board found such payments to be reasonable in scope and purpose.
Collateral or “Fall-Out” Benefits Derived by the Advisor. The Board considered the possible existence of collateral benefits the Advisor may receive as a result of its relationship with the Fund. They concluded that the Advisor’s primary business is managing funds and it generally does not use fund or shareholder information to generate profits in other lines of business, and therefore does not derive any significant collateral benefits from them. To the extent there are potential collateral benefits, the Board has been advised and has taken this into consideration in its review of the management contract with the Fund. The Board noted that additional assets from other clients may offer the Advisor some benefit from increased leverage with service providers and counterparties. Additionally, the Advisor may receive proprietary research from broker-dealers that execute fund portfolio transactions, which the Board concluded is likely to benefit other clients of the Advisor, as well as Fund shareholders. The Board also determined that the Advisor is able to provide investment management services to certain clients other than the Fund, at least in part, due to its existing infrastructure built to serve the fund complex. The Board concluded that appropriate allocation methodologies had been employed to assign resources and the cost of those resources to these other clients and, where expressly provided, these other client assets may be included with the assets of the Fund to determine breakpoints in the management fee schedule.
Existing Relationship. The Board also considered whether there was any reason for not continuing the existing arrangement with the Advisor. In this regard, the Board was mindful of the potential disruptions of the Fund’s operations and various risks, uncertainties, and other effects that could occur as a result of a decision not to continue such relationship. In particular, the Board recognized that most shareholders have invested in the Fund on the strength of the Advisor’s industry standing and reputation and in the expectation that the Advisor will have a continuing role in providing advisory services to the Fund.
Conclusion of the Directors. As a result of this process, the Board, including all of the independent Directors, taking into account all of the factors discussed above and the information provided by the Advisor and others in connection with its review and throughout the year, determined that the management fee is fair and reasonable in light of the services provided and that the investment management agreement between the Fund and the Advisor should be renewed.
34
Additional Information |
Retirement Account Information
As required by law, distributions you receive from certain retirement accounts are subject to federal income tax withholding, unless you elect not to have withholding apply*. Tax will be withheld on the total amount withdrawn even though you may be receiving amounts that are not subject to withholding, such as nondeductible contributions. In such case, excess amounts of withholding could occur. You may adjust your withholding election so that a greater or lesser amount will be withheld.
If you don’t want us to withhold on this amount, you must notify us to not withhold the federal income tax. You may notify us in writing or in certain situations by telephone or through other electronic means. For systematic withdrawals, your withholding election will remain in effect until revoked or changed by filing a new election. You have the right to revoke your election at any time and change your withholding percentage for future distributions.
Remember, even if you elect not to have income tax withheld, you are liable for paying income tax on the taxable portion of your withdrawal. If you elect not to have income tax withheld or you don’t have enough income tax withheld, you may be responsible for payment of estimated tax. You may incur penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. You can reduce or defer the income tax on a distribution by directly or indirectly rolling such distribution over to another IRA or eligible plan. You should consult your tax advisor for additional information.
State tax will be withheld if, at the time of your distribution, your address is within one of the mandatory withholding states and you have federal income tax withheld (or as otherwise required by state law). State taxes will be withheld from your distribution in accordance with the respective state rules.
*Some 403(b), 457 and qualified retirement plan distributions may be subject to 20% mandatory withholding, as they are subject to special tax and withholding rules. Your plan administrator or plan sponsor is required to provide you with a special tax notice explaining those rules at the time you request a distribution. If applicable, federal and/or state taxes may be withheld from your distribution amount.
Proxy Voting Policies
A description of the policies that the fund's investment advisor uses in exercising the voting rights associated with the securities purchased and/or held by the fund is available without charge, upon request, by calling 1-800-345-2021. It is also available on American Century Investments’ website at americancentury.com/proxy and on the Securities and Exchange Commission’s website at sec.gov. Information regarding how the investment advisor voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on americancentury.com/proxy. It is also available at sec.gov.
Quarterly Portfolio Disclosure
The fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. These portfolio holdings are available on the fund's website at americancentury.com and, upon request, by calling 1-800-345-2021. The fund’s Form N-PORT reports are available on the SEC’s website at sec.gov.
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Other Tax Information
The following information is provided pursuant to provisions of the Internal Revenue Code.
The fund hereby designates up to the maximum amount allowable as qualified dividend income for the fiscal year ended November 30, 2021.
The fund hereby designates $81,110,887, or up to the maximum amount allowable, as long-term capital gain distributions (20% rate gain distributions) for the fiscal year ended November 30, 2021.
The fund hereby designates $628,694 as qualified short-term capital gain distributions for purposes of Internal Revenue Code Section 871 for the fiscal year ended November 30, 2021.
For the fiscal year ended November 30, 2021, the fund intends to pass through to shareholders foreign source income of $30,342,551 and foreign taxes paid of $2,098,360, or up to the maximum amount allowable, as a foreign tax credit. Foreign source income and foreign tax expense per outstanding share on November 30, 2021 are $0.3066 and $0.0212, respectively.
The fund utilized earnings and profits of $16,876,176 distributed to shareholders on redemption of shares as part of the dividends paid deduction (tax equalization).
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Contact Us | americancentury.com | |||||||
Automated Information Line | 1-800-345-8765 | |||||||
Investor Services Representative | 1-800-345-2021 or 816-531-5575 | |||||||
Investors Using Advisors | 1-800-378-9878 | |||||||
Business, Not-For-Profit, Employer-Sponsored Retirement Plans | 1-800-345-3533 | |||||||
Banks and Trust Companies, Broker-Dealers, Financial Professionals, Insurance Companies | 1-800-345-6488 | |||||||
Telecommunications Relay Service for the Deaf | 711 | |||||||
American Century World Mutual Funds, Inc. | ||||||||
Investment Advisor: American Century Investment Management, Inc. Kansas City, Missouri | ||||||||
This report and the statements it contains are submitted for the general information of our shareholders. The report is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. | ||||||||
©2022 American Century Proprietary Holdings, Inc. All rights reserved. CL-ANN-91027 2201 |
![image37.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image37.jpg)
Annual Report | |||||
November 30, 2021 | |||||
International Opportunities Fund | |||||
Investor Class (AIOIX) | |||||
I Class (ACIOX) | |||||
A Class (AIVOX) | |||||
C Class (AIOCX) | |||||
R Class (AIORX) |
Table of Contents |
President’s Letter | |||||
Performance | |||||
Portfolio Commentary | |||||
Fund Characteristics | |||||
Shareholder Fee Example | |||||
Schedule of Investments | |||||
Statement of Assets and Liabilities | |||||
Statement of Operations | |||||
Statement of Changes in Net Assets | |||||
Notes to Financial Statements | |||||
Financial Highlights | |||||
Report of Independent Registered Public Accounting Firm | |||||
Management | |||||
Approval of Management Agreement | |||||
Additional Information |
Any opinions expressed in this report reflect those of the author as of the date of the report, and do not necessarily represent the opinions of American Century Investments® or any other person in the American Century Investments organization. Any such opinions are subject to change at any time based upon market or other conditions and American Century Investments disclaims any responsibility to update such opinions. These opinions may not be relied upon as investment advice and, because investment decisions made by American Century Investments funds are based on numerous factors, may not be relied upon as an indication of trading intent on behalf of any American Century Investments fund. Security examples are used for representational purposes only and are not intended as recommendations to purchase or sell securities. Performance information for comparative indices and securities is provided to American Century Investments by third party vendors. To the best of American Century Investments’ knowledge, such information is accurate at the time of printing.
President’s Letter |
![image30a.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image30a.jpg)
Dear Investor:
Thank you for reviewing this annual report for the period ended November 30, 2021. Annual reports help convey important information about fund returns, including market factors that affected performance. For additional investment insights, please visit americancentury.com.
Global Stocks Advanced Despite Lingering and New Challenges
Global stocks broadly delivered solid gains for the 12-month period, even as pandemic-related challenges persisted. Improving economic data, along with central bank and government support and positive vaccine developments, helped boost corporate earnings and promote investor optimism. The U.S. generally outpaced other nations. Virus outbreaks and slower vaccine rollouts, particularly in emerging markets, led to lingering lockdowns in some regions.
As the period progressed, steady economic gains combined with ongoing monetary and fiscal support, rising energy prices and severe supply chain disruptions pushed global interest rates and inflation higher. In the U.S., year-over-year headline inflation climbed to 6.8% in November 2021, the largest 12-month increase in nearly 40 years. Similarly, inflation in the eurozone hit a 30-year high, while prices in the U.K. climbed to their highest level in 10 years.
Late in the period, the Federal Reserve began tapering its bond buying while adopting a more hawkish rate-tightening outlook amid surging inflation. However, central banks in Europe and the U.K. maintained their supportive programs, expressing concerns about slowing global growth outlooks. Meanwhile, the emergence of a new COVID-19 variant in late November triggered a steep sell-off among global stocks to end the reporting period.
Despite mounting inflation worries and late-period volatility, global stocks delivered solid performance for the full 12 months, highlighted by strong gains in developed markets. Emerging markets stocks generally delivered more modest returns.
Several Factors Shaping Market Dynamics
The return to pre-pandemic life is progressing, albeit somewhat cautiously due to COVID-19’s lingering effects. As the economy and markets respond to this fluid backdrop, investors will face opportunities and ongoing challenges. Economic growth, inflation, the virus’s trajectory, supply chain normalization and fiscal and monetary policy likely will sway market dynamics.
We appreciate your confidence in us during these extraordinary times. Our firm has a long history of helping clients weather unpredictable markets, and we’re confident we will continue to meet today’s challenges.
Sincerely,
![image23.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image23.jpg)
Jonathan Thomas
President and Chief Executive Officer
American Century Investments
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Performance |
Total Returns as of November 30, 2021 | |||||||||||||||||
Average Annual Returns | |||||||||||||||||
Ticker Symbol | 1 year | 5 years | 10 years | Inception Date | |||||||||||||
Investor Class | AIOIX | 10.01% | 14.06% | 11.54% | 6/1/01 | ||||||||||||
MSCI ACWI ex-U.S. Small Cap Growth Index | — | 15.53% | 13.01% | 9.67% | — | ||||||||||||
I Class | ACIOX | 10.12% | 14.28% | 11.73% | 1/9/03 | ||||||||||||
A Class | AIVOX | 3/1/10 | |||||||||||||||
No sales charge | 9.70% | 13.79% | 11.26% | ||||||||||||||
With sales charge | 3.42% | 12.46% | 10.62% | ||||||||||||||
C Class | AIOCX | 8.93% | 12.94% | 10.44% | 3/1/10 | ||||||||||||
R Class | AIORX | 9.41% | 13.49% | 10.98% | 3/1/10 |
Fund returns would have been lower if a portion of the fees had not been waived.
C Class shares will automatically convert to A Class shares after being held for approximately eight years. C Class average annual returns do not reflect this conversion.
Sales charges include initial sales charges and contingent deferred sales charges (CDSCs), as applicable. A Class shares have a 5.75% maximum initial sales charge and may be subject to a maximum CDSC of 1.00%. C Class shares redeemed within 12 months of purchase are subject to a maximum CDSC of 1.00%. The SEC requires that mutual funds provide performance information net of maximum sales charges in all cases where charges could be applied.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
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Growth of $10,000 Over 10 Years | ||
$10,000 investment made November 30, 2011 | ||
Performance for other share classes will vary due to differences in fee structure. |
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Value on November 30, 2021 | |||||
Investor Class — $29,838 | |||||
MSCI ACWI ex-U.S. Small Cap Growth Index — $25,200 | |||||
Ending value of Investor Class would have been lower if a portion of the fees had not been waived.
Total Annual Fund Operating Expenses | ||||||||||||||
Investor Class | I Class | A Class | C Class | R Class | ||||||||||
1.40% | 1.20% | 1.65% | 2.40% | 1.90% |
The total annual fund operating expenses shown is as stated in the fund’s prospectus current as of the date of this report. The prospectus may vary from the expense ratio shown elsewhere in this report because it is based on a different time period, includes acquired fund fees and expenses, and, if applicable, does not include fee waivers or expense reimbursements.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
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Portfolio Commentary |
Portfolio Managers: Trevor Gurwich, Federico Laffan and Pratik Patel
Performance Summary
International Opportunities returned 10.01%* for the fiscal year ended November 30, 2021. By comparison, the MSCI ACWI ex-U.S. Small Cap Growth Index (the fund’s benchmark) returned 15.53%.
Portfolio Review
Stocks rose strongly in late 2020, as progress toward COVID-19 vaccines raised hopes for easing lockdown measures and a global economic resurgence. Market leadership shifted away from the defensive, stay-at-home stocks that outperformed through much of 2020 toward more cyclically oriented names expected to benefit from a move toward normal. This market broadening continued through the first half of 2021 as the distribution of vaccines and the lifting of COVID-19 restrictions in many countries led to improved economic growth and robust corporate earnings. The market faced some headwinds in the second quarter of 2021, however, as companies reported challenges with supply chain bottlenecks, worker shortages and increased commodity prices. These pressures escalated in the third quarter, leading to increased market turbulence, as inflation fears and expectations for less accommodative monetary policy drove interest rates higher. New virus variants and vaccine rollout delays also complicated reopening plans in some countries. Developments in China, including regulatory uncertainty and a liquidity crisis in the property sector, also contributed to market volatility. Nonetheless, non-U.S. small-cap stocks ended the 12-month period with strong performance, while outperforming large caps.
The fund had a robust positive return but lagged its benchmark index. Stock selection dampened relative performance, especially in the industrials and consumer discretionary sectors. Stock selection in health care lifted relative performance. From a geographic standpoint, stock selection in China detracted, while stock selection in Israel aided relative performance.
China-Based Investments Were Notable Detractors
China-based data center company Vnet Group was a prominent detractor, as increased Chinese regulation of internet companies impacted its key customers. While Vnet reported relatively strong revenue and earnings performance, aided by its retail business, it faced uncertainty due to its lower planned capital expenditures and the potential for decelerating growth in its wholesale business. Data center stocks were also viewed as beneficiaries of the pandemic-driven growth in digitalization, and they were less appealing to investors looking to capitalize on reopening.
The sell-off in digitalization-driven pandemic beneficiaries also hurt stock performance for Japan-based information technology services company Hennge, another prominent detractor for the period. Hennge also provided sales guidance that came in below expectations, due in part to lower customer growth rates.
Daqo New Energy, another China-based detractor, is a low-cost producer of polysilicon, a key material used in solar energy production. The stock rose strongly in 2020, fueled by expectations for increased investments in green energy. It gave back some of these gains in 2021, due in part to concerns over the company’s competitive positioning in the polysilicon market. We exited the investment in the third quarter of 2021 as we found other stocks we believed offered more attractive earnings acceleration profiles.
*All fund returns referenced in this commentary are for Investor Class shares. Performance for other share classes will vary due to differences in fee structure; when Investor Class performance exceeds that of the fund’s benchmark, other share classes may not. See page 3 for returns for all share classes.
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Medical Technology Company Was a Top Contributor
Stock selection in health care aided relative performance. Inmode, a standout contributor, is a medical technology company that provides minimally invasive solutions for cosmetic and other surgeries. It reported strong revenue and earnings growth, as the vaccine rollout reduced virus fears and unleashed pent-up demand for elective medical procedures.
Several technology holdings were also notable contributors. Endava is a digitally focused information technology services company benefiting from robust trends in end markets such as electronic payments, insurance technology, media and telecommunications. We also found other opportunities in digital payments, including Nuvei. This electronic payments company reported very strong revenue growth and guidance, supported by its expanding client base and service offerings.
Outlook
Despite near-term economic uncertainty, we believe the portfolio remains well positioned, supported by a broad array of stocks with strong company-specific drivers. While we have exposure to companies positioned to benefit from improved global economic growth, we remain balanced between reopening names and beneficiaries of secular growth trends.
We continue to see opportunities in information technology, which receives a prominent weighting in the portfolio. These include companies capitalizing on long-term secular trends such as digitalization, cloud computing, automation and software as a service. We believe supply chain disruptions and ongoing uncertainty over virus variants have helped accelerate many of these trends.
We also hold a notable overweight in consumer discretionary, with a focus on companies we believe have sustainable earnings growth potential. Many consumer-facing companies saw strong revenue growth during the pandemic, and as valuations increased, we sought opportunities in other sectors, such as health care, where we have found investments that we believe will deliver accelerating and sustainable earnings growth. The fund is underweight in materials and consumer staples, sectors where we have found fewer compelling investments.
From a regional standpoint, our bottom-up stock selection has led to an overweight in Europe. The fund is underweight in Asia, including Japan. It is also underweight in the emerging markets, including China.
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Fund Characteristics |
NOVEMBER 30, 2021 | |||||
Types of Investments in Portfolio | % of net assets | ||||
Common Stocks | 99.7% | ||||
Exchange-Traded Funds | —* | ||||
Temporary Cash Investments | 0.4% | ||||
Temporary Cash Investments - Securities Lending Collateral | 0.4% | ||||
Other Assets and Liabilities | (0.5)% | ||||
*Category is less than 0.05% of total net assets. | |||||
Top Five Countries* | % of net assets | ||||
Japan | 16.8% | ||||
Canada | 13.9% | ||||
United Kingdom | 13.8% | ||||
Taiwan | 6.2% | ||||
Sweden | 5.6% | ||||
*Exposure indicated excludes Exchange-Traded Funds. The Schedule of Investments provides additional information on the fund's portfolio holdings. |
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Shareholder Fee Example |
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption/exchange fees; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in your fund and to compare these costs with the ongoing cost of investing in other mutual funds.
The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period from May 29, 2021 to November 30, 2021.
Actual Expenses
The table provides information about actual account values and actual expenses for each class. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. First, identify the share class you own. Then simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
If you hold Investor Class shares of any American Century Investments fund, or I Class shares of the American Century Diversified Bond Fund, in an American Century Investments account (i.e., not through a financial intermediary or employer-sponsored retirement plan account), American Century Investments may charge you a $25.00 annual account maintenance fee if the value of those shares is less than $10,000. We will redeem shares automatically in one of your accounts to pay the $25.00 fee. In determining your total eligible investment amount, we will include your investments in all personal accounts (including American Century Investments brokerage accounts) registered under your Social Security number. Personal accounts include individual accounts, joint accounts, UGMA/UTMA accounts, personal trusts, Coverdell Education Savings Accounts and IRAs (including traditional, Roth, Rollover, SEP-, SARSEP- and SIMPLE-IRAs), and certain other retirement accounts. If you have only business, business retirement, employer-sponsored or American Century Investments brokerage accounts, you are currently not subject to this fee. If you are subject to the account maintenance fee, your account value could be reduced by the fee amount.
Hypothetical Example for Comparison Purposes
The table also provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each class of your fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of a fund’s share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption/exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
8
Beginning Account Value 5/29/21 | Ending Account Value 11/30/21 | Expenses Paid During Period(1) 5/29/21 - 11/30/21 | Annualized Expense Ratio(1) | |||||||||||
Actual | ||||||||||||||
Investor Class | $1,000 | $971.10 | $6.88 | 1.37% | ||||||||||
I Class | $1,000 | $971.50 | $5.88 | 1.17% | ||||||||||
A Class | $1,000 | $969.40 | $8.13 | 1.62% | ||||||||||
C Class | $1,000 | $965.50 | $11.87 | 2.37% | ||||||||||
R Class | $1,000 | $968.30 | $9.38 | 1.87% | ||||||||||
Hypothetical | ||||||||||||||
Investor Class | $1,000 | $1,018.50 | $7.05 | 1.37% | ||||||||||
I Class | $1,000 | $1,019.52 | $6.02 | 1.17% | ||||||||||
A Class | $1,000 | $1,017.22 | $8.33 | 1.62% | ||||||||||
C Class | $1,000 | $1,013.40 | $12.16 | 2.37% | ||||||||||
R Class | $1,000 | $1,015.95 | $9.61 | 1.87% |
(1)Expenses are equal to the class's annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 186, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. Annualized expense ratio reflects actual expenses, including any applicable fee waivers or expense reimbursements and excluding any acquired fund fees and expenses.
9
Schedule of Investments |
NOVEMBER 30, 2021
Shares | Value | |||||||
COMMON STOCKS — 99.7% | ||||||||
Australia — 5.4% | ||||||||
carsales.com Ltd. | 343,221 | $ | 6,095,661 | |||||
Corporate Travel Management Ltd.(1) | 434,531 | 6,793,470 | ||||||
IDP Education Ltd. | 360,334 | 8,883,931 | ||||||
Mineral Resources Ltd. | 172,153 | 5,524,879 | ||||||
NEXTDC Ltd.(1) | 687,304 | 5,830,796 | ||||||
OZ Minerals Ltd. | 337,283 | 6,202,815 | ||||||
39,331,552 | ||||||||
Austria — 0.6% | ||||||||
ANDRITZ AG | 91,483 | 4,366,563 | ||||||
Brazil — 1.6% | ||||||||
Embraer SA, ADR(1) | 244,789 | 3,360,953 | ||||||
Locaweb Servicos de Internet SA | 483,752 | 1,136,701 | ||||||
Pet Center Comercio e Participacoes SA | 455,148 | 1,471,863 | ||||||
Petro Rio SA(1) | 1,249,600 | 4,465,516 | ||||||
Santos Brasil Participacoes SA(1) | 798,800 | 842,585 | ||||||
11,277,618 | ||||||||
Canada — 13.9% | ||||||||
Altus Group Ltd.(2) | 144,332 | 7,391,443 | ||||||
Aritzia, Inc.(1) | 93,141 | 3,690,788 | ||||||
ATS Automation Tooling Systems, Inc.(1) | 97,459 | 3,636,832 | ||||||
BRP, Inc. | 78,302 | 6,188,399 | ||||||
Colliers International Group, Inc. (Toronto) | 55,965 | 7,555,461 | ||||||
Descartes Systems Group, Inc. (The)(1) | 124,313 | 9,995,059 | ||||||
FirstService Corp. | 20,185 | 3,879,780 | ||||||
goeasy Ltd. | 70,941 | 9,651,130 | ||||||
Kinaxis, Inc.(1) | 50,166 | 7,667,550 | ||||||
Linamar Corp. | 107,400 | 6,165,968 | ||||||
Nuvei Corp.(1) | 40,311 | 3,973,052 | ||||||
Stantec, Inc. | 155,331 | 8,409,481 | ||||||
TFI International, Inc. | 87,979 | 8,735,572 | ||||||
Tricon Residential, Inc. (Toronto) | 480,916 | 6,603,207 | ||||||
Whitecap Resources, Inc.(2) | 1,399,812 | 7,451,346 | ||||||
100,995,068 | ||||||||
China — 1.2% | ||||||||
China Lesso Group Holdings Ltd. | 565,000 | 820,507 | ||||||
China Yongda Automobiles Services Holdings Ltd. | 3,799,000 | 5,748,070 | ||||||
Vnet Group, Inc., ADR(1) | 244,356 | 2,375,140 | ||||||
8,943,717 | ||||||||
Denmark — 2.9% | ||||||||
ALK-Abello A/S(1) | 15,690 | 7,876,466 | ||||||
Jyske Bank A/S(1) | 141,303 | 7,066,454 | ||||||
Royal Unibrew A/S | 55,653 | 5,931,569 | ||||||
20,874,489 | ||||||||
Finland — 1.4% | ||||||||
Metso Outotec Oyj | 582,942 | 5,874,833 |
10
Shares | Value | |||||||
QT Group Oyj(1) | 26,542 | $ | 4,022,575 | |||||
9,897,408 | ||||||||
France — 4.8% | ||||||||
Alten SA | 51,108 | 8,447,595 | ||||||
APERAM SA | 97,834 | 4,700,766 | ||||||
Elis SA(1) | 330,761 | 5,191,520 | ||||||
Euronext NV | 66,501 | 6,534,391 | ||||||
SOITEC(1) | 29,322 | 7,720,362 | ||||||
Wendel SE | 21,682 | 2,479,161 | ||||||
35,073,795 | ||||||||
Germany — 3.8% | ||||||||
AIXTRON SE | 167,877 | 3,373,935 | ||||||
Befesa SA | 83,760 | 5,542,633 | ||||||
CTS Eventim AG & Co. KGaA(1) | 80,555 | 5,234,988 | ||||||
Dermapharm Holding SE | 82,984 | 7,625,175 | ||||||
Eckert & Ziegler Strahlen- und Medizintechnik AG | 56,671 | 6,240,825 | ||||||
28,017,556 | ||||||||
India — 4.6% | ||||||||
Indraprastha Gas Ltd. | 403,081 | 2,599,528 | ||||||
Max Healthcare Institute Ltd.(1) | 1,619,296 | 8,198,918 | ||||||
Prestige Estates Projects Ltd. | 607,330 | 3,406,117 | ||||||
Varun Beverages Ltd. | 732,588 | 8,684,371 | ||||||
WNS Holdings Ltd., ADR(1) | 128,956 | 10,841,331 | ||||||
33,730,265 | ||||||||
Israel — 3.7% | ||||||||
Inmode Ltd.(1) | 80,670 | 6,130,920 | ||||||
Kornit Digital Ltd.(1) | 61,462 | 9,521,079 | ||||||
Nova Ltd.(1) | 88,373 | 11,360,349 | ||||||
27,012,348 | ||||||||
Italy — 1.1% | ||||||||
Autogrill SpA(1)(2) | 981,326 | 6,342,635 | ||||||
Brembo SpA | 143,058 | 1,893,256 | ||||||
8,235,891 | ||||||||
Japan — 16.8% | ||||||||
Asics Corp. | 263,600 | 6,527,119 | ||||||
BayCurrent Consulting, Inc. | 19,600 | 8,099,071 | ||||||
en Japan, Inc. | 169,700 | 5,278,273 | ||||||
Food & Life Cos. Ltd. | 182,700 | 7,736,877 | ||||||
GMO Financial Gate, Inc. | 25,200 | 6,434,566 | ||||||
Hennge KK(1) | 58,800 | 2,189,407 | ||||||
IHI Corp. | 337,600 | 6,307,356 | ||||||
Insource Co. Ltd. | 205,800 | 4,432,897 | ||||||
JMDC, Inc.(1) | 131,500 | 10,510,068 | ||||||
JTOWER, Inc.(1) | 77,700 | 7,011,585 | ||||||
MatsukiyoCocokara & Co. | 171,800 | 6,725,199 | ||||||
Menicon Co. Ltd. | 143,100 | 4,735,294 | ||||||
Nextage Co. Ltd. | 517,000 | 10,384,585 | ||||||
Nippon Gas Co. Ltd. | 194,500 | 2,423,482 | ||||||
Open House Co. Ltd. | 100,600 | 5,702,189 | ||||||
Outsourcing, Inc. | 308,000 | 4,063,217 | ||||||
Simplex Holdings, Inc.(1) | 148,900 | 3,675,242 | ||||||
Toyo Tire Corp. | 311,300 | 4,722,122 |
11
Shares | Value | |||||||
Ushio, Inc. | 361,100 | $ | 6,689,509 | |||||
West Holdings Corp. | 153,500 | 8,782,692 | ||||||
122,430,750 | ||||||||
Malaysia — 0.2% | ||||||||
CTOS Digital Bhd | 3,464,700 | 1,528,746 | ||||||
Mexico — 0.2% | ||||||||
Controladora Vuela Cia de Aviacion SAB de CV, ADR(1) | 93,263 | 1,382,158 | ||||||
Netherlands — 4.2% | ||||||||
Alfen Beheer BV(1)(2) | 40,476 | 3,946,125 | ||||||
ASM International NV | 8,392 | 3,772,139 | ||||||
ASR Nederland NV | 125,424 | 5,356,272 | ||||||
Basic-Fit NV(1)(2) | 119,372 | 5,180,952 | ||||||
BE Semiconductor Industries NV | 88,943 | 8,457,573 | ||||||
OCI NV(1) | 151,072 | 4,136,687 | ||||||
30,849,748 | ||||||||
Norway — 0.5% | ||||||||
Bakkafrost P/F | 53,060 | 3,484,743 | ||||||
Poland — 0.6% | ||||||||
Bank Polska Kasa Opieki SA | 156,169 | 4,509,714 | ||||||
South Korea — 2.7% | ||||||||
BGF retail Co. Ltd. | 12,745 | 1,557,101 | ||||||
Chunbo Co. Ltd. | 6,443 | 1,878,511 | ||||||
Ecopro BM Co. Ltd. | 19,209 | 8,781,595 | ||||||
Hansol Chemical Co. Ltd. | 23,254 | 5,866,682 | ||||||
Osstem Implant Co. Ltd. | 19,844 | 1,865,958 | ||||||
19,949,847 | ||||||||
Sweden — 5.6% | ||||||||
AddTech AB, B Shares | 308,791 | 7,019,641 | ||||||
BICO Group AB(1) | 135,164 | 4,384,906 | ||||||
Fortnox AB | 81,099 | 4,979,179 | ||||||
Lifco AB, B Shares | 152,300 | 4,115,946 | ||||||
Nordic Entertainment Group AB, B Shares(1) | 130,005 | 6,456,142 | ||||||
Scandic Hotels Group AB(1)(2) | 888,780 | 3,454,634 | ||||||
Storytel AB(1)(2) | 72,706 | 1,345,305 | ||||||
Trelleborg AB, B Shares | 211,971 | 4,811,736 | ||||||
Vitrolife AB | 68,073 | 4,164,790 | ||||||
40,732,279 | ||||||||
Switzerland — 3.9% | ||||||||
Comet Holding AG | 22,385 | 8,423,155 | ||||||
PolyPeptide Group AG(1) | 62,885 | 8,526,875 | ||||||
SIG Combibloc Group AG(1) | 271,087 | 7,145,878 | ||||||
Zur Rose Group AG(1) | 11,029 | 4,175,155 | ||||||
28,271,063 | ||||||||
Taiwan — 6.2% | ||||||||
Advanced Wireless Semiconductor Co. | 1,127,000 | 5,925,331 | ||||||
Airtac International Group | 72,131 | 2,207,536 | ||||||
ASPEED Technology, Inc. | 100,000 | 12,060,072 | ||||||
Chailease Holding Co. Ltd. | 909,261 | 8,044,237 | ||||||
Makalot Industrial Co. Ltd. | 264,000 | 2,203,138 | ||||||
Merida Industry Co. Ltd. | 230,000 | 2,470,011 | ||||||
Nien Made Enterprise Co. Ltd. | 187,000 | 2,547,418 | ||||||
Parade Technologies Ltd. | 71,000 | 5,408,660 |
12
Shares | Value | |||||||
Pegavision Corp. | 138,000 | $ | 2,240,263 | |||||
Wiwynn Corp. | 54,000 | 2,027,156 | ||||||
45,133,822 | ||||||||
United Kingdom — 13.8% | ||||||||
Auction Technology Group plc(1) | 205,680 | 3,455,693 | ||||||
Computacenter plc | 140,481 | 5,272,878 | ||||||
Darktrace plc(1) | 580,508 | 3,530,127 | ||||||
Electrocomponents plc | 634,221 | 10,216,367 | ||||||
Endava plc, ADR(1) | 73,427 | 11,494,263 | ||||||
Future plc | 211,206 | 10,081,092 | ||||||
Greggs plc | 179,724 | 7,153,431 | ||||||
Hays plc | 3,331,759 | 6,517,882 | ||||||
Howden Joinery Group plc | 501,909 | 5,782,471 | ||||||
Intermediate Capital Group plc | 352,906 | 9,803,581 | ||||||
Marks & Spencer Group plc(1) | 2,840,480 | 8,912,005 | ||||||
S4 Capital plc(1) | 761,257 | 5,879,752 | ||||||
Tritax Big Box REIT plc | 2,810,403 | 8,882,483 | ||||||
Watches of Switzerland Group plc(1) | 187,839 | 3,352,093 | ||||||
100,334,118 | ||||||||
TOTAL COMMON STOCKS (Cost $603,527,923) | 726,363,258 | |||||||
EXCHANGE-TRADED FUNDS† | ||||||||
Schwab International Small-Cap Equity ETF(2) (Cost $48,601) | 1,179 | 47,632 | ||||||
TEMPORARY CASH INVESTMENTS — 0.4% | ||||||||
Repurchase Agreement, BMO Capital Markets Corp., (collateralized by various U.S. Treasury obligations, 0.125% - 2.625%, 6/30/22 - 5/15/51, valued at $770,619), in a joint trading account at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $754,458) | 754,458 | |||||||
Repurchase Agreement, Fixed Income Clearing Corp., (collateralized by various U.S. Treasury obligations, 1.00%, 7/31/28, valued at $2,563,308), at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $2,513,001) | 2,513,000 | |||||||
State Street Institutional U.S. Government Money Market Fund, Premier Class | 11,695 | 11,695 | ||||||
TOTAL TEMPORARY CASH INVESTMENTS (Cost $3,279,153) | 3,279,153 | |||||||
TEMPORARY CASH INVESTMENTS - SECURITIES LENDING COLLATERAL(3) — 0.4% | ||||||||
State Street Navigator Securities Lending Government Money Market Portfolio (Cost $2,947,763) | 2,947,763 | 2,947,763 | ||||||
TOTAL INVESTMENT SECURITIES — 100.5% (Cost $609,803,440) | 732,637,806 | |||||||
OTHER ASSETS AND LIABILITIES — (0.5)% | (3,912,865) | |||||||
TOTAL NET ASSETS — 100.0% | $ | 728,724,941 |
13
MARKET SECTOR DIVERSIFICATION | |||||
(as a % of net assets) | |||||
Information Technology | 22.3% | ||||
Industrials | 21.2% | ||||
Consumer Discretionary | 16.7% | ||||
Health Care | 9.8% | ||||
Financials | 7.2% | ||||
Real Estate | 5.1% | ||||
Materials | 5.0% | ||||
Communication Services | 4.8% | ||||
Consumer Staples | 4.2% | ||||
Utilities | 1.8% | ||||
Energy | 1.6% | ||||
Exchange-Traded Funds | —* | ||||
Temporary Cash Investments | 0.4% | ||||
Temporary Cash Investments - Securities Lending Collateral | 0.4% | ||||
Other Assets and Liabilities | (0.5)% |
*Category is less than 0.05% of total net assets.
NOTES TO SCHEDULE OF INVESTMENTS | ||||||||
ADR | - | American Depositary Receipt |
†Category is less than 0.05% of total net assets.
(1)Non-income producing.
(2)Security, or a portion thereof, is on loan. At the period end, the aggregate value of securities on loan was $8,843,630. The amount of securities on loan indicated may not correspond with the securities on loan identified because securities with pending sales are in the process of recall from the brokers.
(3)Investment of cash collateral from securities on loan. At the period end, the aggregate value of the collateral held by the fund was $9,582,978, which includes securities collateral of $6,635,215.
See Notes to Financial Statements.
14
Statement of Assets and Liabilities |
NOVEMBER 30, 2021 | |||||
Assets | |||||
Investment securities, at value (cost of $606,855,677) — including $8,843,630 of securities on loan | $ | 729,690,043 | |||
Investment made with cash collateral received for securities on loan, at value (cost of $2,947,763) | 2,947,763 | ||||
Total investment securities, at value (cost of $609,803,440) | 732,637,806 | ||||
Foreign currency holdings, at value (cost of $13,561) | 13,633 | ||||
Receivable for investments sold | 7,746 | ||||
Receivable for capital shares sold | 68,738 | ||||
Dividends and interest receivable | 991,757 | ||||
Securities lending receivable | 6,354 | ||||
Other assets | 129,224 | ||||
733,855,258 | |||||
Liabilities | |||||
Payable for collateral received for securities on loan | 2,947,763 | ||||
Payable for investments purchased | 881,858 | ||||
Payable for capital shares redeemed | 382,279 | ||||
Accrued management fees | 835,887 | ||||
Distribution and service fees payable | 3,230 | ||||
Accrued other expenses | 79,300 | ||||
5,130,317 | |||||
Net Assets | $ | 728,724,941 | |||
Net Assets Consist of: | |||||
Capital (par value and paid-in surplus) | $ | 506,227,626 | |||
Distributable earnings | 222,497,315 | ||||
$ | 728,724,941 |
Net Assets | Shares Outstanding | Net Asset Value Per Share | |||||||||
Investor Class, $0.01 Par Value | $576,311,880 | 41,804,252 | $13.79 | ||||||||
I Class, $0.01 Par Value | $141,572,830 | 10,123,438 | $13.98 | ||||||||
A Class, $0.01 Par Value | $8,220,185 | 603,716 | $13.62* | ||||||||
C Class, $0.01 Par Value | $666,506 | 51,787 | $12.87 | ||||||||
R Class, $0.01 Par Value | $1,953,540 | 145,466 | $13.43 |
*Maximum offering price $14.45 (net asset value divided by 0.9425).
See Notes to Financial Statements.
15
Statement of Operations |
YEAR ENDED NOVEMBER 30, 2021 | |||||
Investment Income (Loss) | |||||
Income: | |||||
Dividends (net of foreign taxes withheld of $787,306) | $ | 7,825,585 | |||
Securities lending, net | 147,984 | ||||
Interest (net of foreign taxes withheld of $584) | 9,951 | ||||
7,983,520 | |||||
Expenses: | |||||
Management fees | 9,836,301 | ||||
Distribution and service fees: | |||||
A Class | 20,846 | ||||
C Class | 8,754 | ||||
R Class | 9,586 | ||||
Directors' fees and expenses | 18,882 | ||||
Other expenses | 123,834 | ||||
10,018,203 | |||||
Net investment income (loss) | (2,034,683) | ||||
Realized and Unrealized Gain (Loss) | |||||
Net realized gain (loss) on: | |||||
Investment transactions (net of foreign tax expenses paid (refunded) of $2,942) | 120,628,055 | ||||
Foreign currency translation transactions | (553,929) | ||||
120,074,126 | |||||
Change in net unrealized appreciation (depreciation) on: | |||||
Investments | (51,897,070) | ||||
Translation of assets and liabilities in foreign currencies | (60,931) | ||||
(51,958,001) | |||||
Net realized and unrealized gain (loss) | 68,116,125 | ||||
Net Increase (Decrease) in Net Assets Resulting from Operations | $ | 66,081,442 |
See Notes to Financial Statements.
16
Statement of Changes in Net Assets |
YEARS ENDED NOVEMBER 30, 2021 AND NOVEMBER 30, 2020 | ||||||||
Increase (Decrease) in Net Assets | November 30, 2021 | November 30, 2020 | ||||||
Operations | ||||||||
Net investment income (loss) | $ | (2,034,683) | $ | (579,609) | ||||
Net realized gain (loss) | 120,074,126 | 63,923,408 | ||||||
Change in net unrealized appreciation (depreciation) | (51,958,001) | 83,177,979 | ||||||
Net increase (decrease) in net assets resulting from operations | 66,081,442 | 146,521,778 | ||||||
Distributions to Shareholders | ||||||||
From earnings: | ||||||||
Investor Class | (18,706,813) | (4,749,297) | ||||||
I Class | (3,151,509) | (906,124) | ||||||
A Class | (240,368) | (42,373) | ||||||
C Class | (34,163) | — | ||||||
R Class | (47,944) | (8,828) | ||||||
Decrease in net assets from distributions | (22,180,797) | (5,706,622) | ||||||
Capital Share Transactions | ||||||||
Net increase (decrease) in net assets from capital share transactions (Note 5) | 15,262,600 | (58,197,577) | ||||||
Net increase (decrease) in net assets | 59,163,245 | 82,617,579 | ||||||
Net Assets | ||||||||
Beginning of period | 669,561,696 | 586,944,117 | ||||||
End of period | $ | 728,724,941 | $ | 669,561,696 |
See Notes to Financial Statements.
17
Notes to Financial Statements |
NOVEMBER 30, 2021
1. Organization
American Century World Mutual Funds, Inc. (the corporation) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company and is organized as a Maryland corporation. International Opportunities Fund (the fund) is one fund in a series issued by the corporation. The fund's investment objective is to seek capital growth.
The fund offers the Investor Class, I Class, A Class, C Class and R Class. The A Class may incur an initial sales charge. The A Class and C Class may be subject to a contingent deferred sales charge.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently followed by the fund in preparation of its financial statements. The fund is an investment company and follows accounting and reporting guidance in accordance with accounting principles generally accepted in the United States of America. This may require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from these estimates. Management evaluated the impact of events or transactions occurring through the date the financial statements were issued that would merit recognition or disclosure.
Investment Valuations — The fund determines the fair value of its investments and computes its net asset value (NAV) per share at the close of regular trading (usually 4 p.m. Eastern time) on the New York Stock Exchange (NYSE) on each day the NYSE is open. The Board of Directors has adopted valuation policies and procedures to guide the investment advisor in the fund’s investment valuation process and to provide methodologies for the oversight of the fund’s pricing function.
Equity securities that are listed or traded on a domestic securities exchange are valued at the last reported sales price or at the official closing price as provided by the exchange. Equity securities traded on foreign securities exchanges are generally valued at the closing price of such securities on the exchange where primarily traded or at the close of the NYSE, if that is earlier. If no last sales price is reported, or if local convention or regulation so provides, the mean of the latest bid and asked prices may be used. Securities traded over-the-counter are valued at the mean of the latest bid and asked prices, the last sales price, or the official closing price. Equity securities initially expressed in local currencies are translated into U.S. dollars at the mean of the appropriate currency exchange rate at the close of the NYSE as provided by an independent pricing service.
Open-end management investment companies are valued at the reported NAV per share. Repurchase agreements are valued at cost, which approximates fair value.
If the fund determines that the market price for an investment is not readily available or the valuation methods mentioned above do not reflect an investment’s fair value, such investment is valued as determined in good faith by the Board of Directors or its delegate, in accordance with policies and procedures adopted by the Board of Directors. In its determination of fair value, the fund may review several factors including, but not limited to, market information regarding the specific investment or comparable investments and correlation with other investment types, futures indices or general market indicators. Circumstances that may cause the fund to use these procedures to value an investment include, but are not limited to: an investment has been declared in default or is distressed; trading in a security has been suspended during the trading day or a security is not actively trading on its principal exchange; prices received from a regular pricing source are deemed unreliable; or there is a foreign market holiday and no trading occurred.
18
The fund monitors for significant events occurring after the close of an investment’s primary exchange but before the fund’s NAV per share is determined. Significant events may include, but are not limited to: corporate announcements and transactions; governmental action and political unrest that could impact a specific investment or an investment sector; or armed conflicts, natural disasters and similar events that could affect investments in a specific country or region. The fund also monitors for significant fluctuations between domestic and foreign markets, as evidenced by the U.S. market or such other indicators that the Board of Directors, or its delegate, deems appropriate. The fund may apply a model-derived factor to the closing price of equity securities traded on foreign securities exchanges. The factor is based on observable market data as provided by an independent pricing service.
Security Transactions — Security transactions are accounted for as of the trade date. Net realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes. Certain countries impose taxes on realized gains on the sale of securities registered in their country. The fund records the foreign tax expense, if any, on an accrual basis. The foreign tax expense on realized gains and unrealized appreciation reduces the net realized gain (loss) on investment transactions and net unrealized appreciation (depreciation) on investments, respectively.
Investment Income — Dividend income less foreign taxes withheld, if any, is recorded as of the ex-dividend date. Distributions received on securities that represent a return of capital or long-term capital gain are recorded as a reduction of cost of investments and/or as a realized gain. The fund may estimate the components of distributions received that may be considered nontaxable distributions or long-term capital gain distributions for income tax purposes. Interest income less foreign taxes withheld, if any, is recorded on the accrual basis and includes accretion of discounts and amortization of premiums. Securities lending income is net of fees and rebates earned by the lending agent for its services.
Foreign Currency Translations — All assets and liabilities initially expressed in foreign currencies are translated into U.S. dollars at prevailing exchange rates at period end. The fund may enter into spot foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of investment securities, dividend and interest income, spot foreign currency exchange contracts, and expenses are translated at the rates of exchange prevailing on the respective dates of such transactions. Net realized and unrealized foreign currency exchange gains or losses related to investment securities are a component of net realized gain (loss) on investment transactions and change in net unrealized appreciation (depreciation) on investments, respectively.
Repurchase Agreements — The fund may enter into repurchase agreements with institutions that American Century Investment Management, Inc. (ACIM) (the investment advisor) has determined are creditworthy pursuant to criteria adopted by the Board of Directors. The fund requires that the collateral, represented by securities, received in a repurchase transaction be transferred to the custodian in a manner sufficient to enable the fund to obtain those securities in the event of a default under the repurchase agreement. ACIM monitors, on a daily basis, the securities transferred to ensure the value, including accrued interest, of the securities under each repurchase agreement is equal to or greater than amounts owed to the fund under each repurchase agreement.
Joint Trading Account — Pursuant to an Exemptive Order issued by the Securities and Exchange Commission, the fund, along with certain other funds in the American Century Investments family of funds, may transfer uninvested cash balances into a joint trading account. These balances are invested in one or more repurchase agreements that are collateralized by U.S. Treasury or Agency obligations.
Income Tax Status — It is the fund’s policy to distribute substantially all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code. Accordingly, no provision has been made for income taxes. The fund files U.S. federal, state, local and non-U.S. tax returns as applicable. The fund's tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years from the date of filing but can be longer in certain jurisdictions. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
19
Segregated Assets — In accordance with the 1940 Act, the fund segregates assets on its books and records to cover certain types of investment securities and other financial instruments. ACIM monitors, on a daily basis, the securities segregated to ensure the fund designates a sufficient amount of liquid assets, marked-to-market daily. The fund may also receive assets or be required to pledge assets at the custodian bank or with a broker for collateral requirements.
Multiple Class — All shares of the fund represent an equal pro rata interest in the net assets of the class to which such shares belong, and have identical voting, dividend, liquidation and other rights and the same terms and conditions, except for class specific expenses and exclusive rights to vote on matters affecting only individual classes. Income, non-class specific expenses, and realized and unrealized capital gains and losses of the fund are allocated to each class of shares based on their relative net assets.
Distributions to Shareholders — Distributions from net investment income and net realized gains, if any, are generally declared and paid annually. The fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code, in all events in a manner consistent with provisions of the 1940 Act. The fund may elect to treat a portion of its payment to a redeeming shareholder, which represents the pro rata share of undistributed net investment income and net realized gains, as a distribution for federal income tax purposes (tax equalization).
Indemnifications — Under the corporation’s organizational documents, its officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business, the fund enters into contracts that provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against a fund. The risk of material loss from such claims is considered by management to be remote.
Securities Lending — Securities are lent to qualified financial institutions and brokers. State Street Bank & Trust Co. serves as securities lending agent to the fund pursuant to a Securities Lending Agreement. The lending of securities exposes the fund to risks such as: the borrowers may fail to return the loaned securities, the borrowers may not be able to provide additional collateral, the fund may experience delays in recovery of the loaned securities or delays in access to collateral, or the fund may experience losses related to the investment collateral. To minimize certain risks, loan counterparties pledge collateral in the form of cash and/or securities. The lending agent has agreed to indemnify the fund in the case of default of any securities borrowed. Cash collateral received is invested in the State Street Navigator Securities Lending Government Money Market Portfolio, a money market mutual fund registered under the 1940 Act. The loans may also be secured by U.S. government securities in an amount at least equal to the market value of the securities loaned, plus accrued interest and dividends, determined on a daily basis and adjusted accordingly. By lending securities, the fund seeks to increase its net investment income through the receipt of interest and fees. Such income is reflected separately within the Statement of Operations. The value of loaned securities and related collateral outstanding at period end, if any, are shown on a gross basis within the Schedule of Investments and Statement of Assets and Liabilities.
The following table reflects a breakdown of transactions accounted for as secured borrowings, the gross obligation by the type of collateral pledged, and the remaining contractual maturity of those transactions as of November 30, 2021.
Remaining Contractual Maturity of Agreements | |||||||||||||||||
Overnight and Continuous | <30 days | Between 30 & 90 days | >90 days | Total | |||||||||||||
Securities Lending Transactions(1) | |||||||||||||||||
Common Stocks | $ | 2,897,565 | — | — | — | $ | 2,897,565 | ||||||||||
Exchange-Traded Funds | 50,198 | — | — | — | 50,198 | ||||||||||||
Total Borrowings | $ | 2,947,763 | — | — | — | $ | 2,947,763 | ||||||||||
Gross amount of recognized liabilities for securities lending transactions | $ | 2,947,763 |
(1)Amount represents the payable for cash collateral received for securities on loan. This will generally be in the Overnight and Continuous column as the securities are typically callable on demand.
20
3. Fees and Transactions with Related Parties
Certain officers and directors of the corporation are also officers and/or directors of American Century Companies, Inc. (ACC). The corporation’s investment advisor, ACIM, the corporation's distributor, American Century Investment Services, Inc. (ACIS), and the corporation’s transfer agent, American Century Services, LLC, are wholly owned, directly or indirectly, by ACC.
Management Fees — The corporation has entered into a management agreement with ACIM, under which ACIM provides the fund with investment advisory and management services in exchange for a single, unified management fee (the fee) per class. The agreement provides that ACIM will pay all expenses of managing and operating the fund, except brokerage expenses, taxes, interest, fees and expenses of the independent directors (including legal counsel fees), extraordinary expenses, and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the 1940 Act. The fee is computed and accrued daily based on each class's daily net assets and paid monthly in arrears. The difference in the fee among the classes is a result of their separate arrangements for non-Rule 12b-1 shareholder services. It is not the result of any difference in advisory or custodial fees or other expenses related to the management of the fund’s assets, which do not vary by class. The rate of the fee is determined by applying a fee rate calculation formula. This formula takes into account the fund’s assets as well as certain assets, if any, of other clients of the investment advisor outside the American Century Investments family of funds (such as subadvised funds and separate accounts) that use very similar investment teams and strategies (strategy assets).
The management fee schedule range and the effective annual management fee for each class for the period ended November 30, 2021 are as follows:
Management Fee Schedule Range | Effective Annual Management Fee | |||||||
Investor Class | 1.200% to 1.550% | 1.35% | ||||||
I Class | 1.000% to 1.350% | 1.15% | ||||||
A Class | 1.200% to 1.550% | 1.35% | ||||||
C Class | 1.200% to 1.550% | 1.35% | ||||||
R Class | 1.200% to 1.550% | 1.35% |
Distribution and Service Fees — The Board of Directors has adopted a separate Master Distribution and Individual Shareholder Services Plan for each of the A Class, C Class and R Class (collectively the plans), pursuant to Rule 12b-1 of the 1940 Act. The plans provide that the A Class will pay ACIS an annual distribution and service fee of 0.25%. The plans provide that the C Class will pay ACIS an annual distribution and service fee of 1.00%, of which 0.25% is paid for individual shareholder services and 0.75% is paid for distribution services. The plans provide that the R Class will pay ACIS an annual distribution and service fee of 0.50%. The fees are computed and accrued daily based on each class’s daily net assets and paid monthly in arrears. The fees are used to pay financial intermediaries for distribution and individual shareholder services. Fees incurred under the plans during the period ended November 30, 2021 are detailed in the Statement of Operations.
Directors' Fees and Expenses — The Board of Directors is responsible for overseeing the investment advisor’s management and operations of the fund. The directors receive detailed information about the fund and its investment advisor regularly throughout the year, and meet at least quarterly with management of the investment advisor to review reports about fund operations. The fund’s officers do not receive compensation from the fund.
Interfund Transactions — The fund may enter into security transactions with other American Century Investments funds and other client accounts of the investment advisor, in accordance with the 1940 Act rules and procedures adopted by the Board of Directors. The rules and procedures require, among other things, that these transactions be effected at the independent current market price of the security. During the period, the interfund purchases and sales were $66,476 and $854,749, respectively. The effect of interfund transactions on the Statement of Operations was $85,598 in net realized gain (loss) on investment transactions.
4. Investment Transactions
Purchases and sales of investment securities, excluding short-term investments, for the period ended November 30, 2021 were $935,093,225 and $938,766,780, respectively.
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5. Capital Share Transactions
Transactions in shares of the fund were as follows:
Year ended November 30, 2021 | Year ended November 30, 2020 | |||||||||||||
Shares | Amount | Shares | Amount | |||||||||||
Investor Class/Shares Authorized | 670,000,000 | 670,000,000 | ||||||||||||
Sold | 2,437,144 | $ | 34,367,124 | 2,429,434 | $ | 26,155,762 | ||||||||
Issued in reinvestment of distributions | 1,354,945 | 17,560,086 | 424,410 | 4,426,599 | ||||||||||
Redeemed | (5,628,705) | (78,750,887) | (8,317,924) | (84,020,321) | ||||||||||
(1,836,616) | (26,823,677) | (5,464,080) | (53,437,960) | |||||||||||
I Class/Shares Authorized | 95,000,000 | 95,000,000 | ||||||||||||
Sold | 4,218,085 | 60,805,209 | 2,092,097 | 23,001,037 | ||||||||||
Issued in reinvestment of distributions | 239,554 | 3,142,942 | 83,972 | 885,061 | ||||||||||
Redeemed | (1,569,667) | (22,513,217) | (2,578,345) | (27,119,055) | ||||||||||
2,887,972 | 41,434,934 | (402,276) | (3,232,957) | |||||||||||
A Class/Shares Authorized | 40,000,000 | 40,000,000 | ||||||||||||
Sold | 92,719 | 1,297,041 | 106,306 | 1,177,267 | ||||||||||
Issued in reinvestment of distributions | 18,060 | 231,711 | 4,036 | 41,817 | ||||||||||
Redeemed | (69,487) | (962,100) | (150,485) | (1,530,563) | ||||||||||
41,292 | 566,652 | (40,143) | (311,479) | |||||||||||
C Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 2,433 | 32,156 | 11,523 | 126,662 | ||||||||||
Issued in reinvestment of distributions | 2,798 | 34,163 | — | — | ||||||||||
Redeemed | (33,621) | (447,317) | (39,923) | (427,777) | ||||||||||
(28,390) | (380,998) | (28,400) | (301,115) | |||||||||||
R Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 77,494 | 1,049,015 | 51,608 | 543,660 | ||||||||||
Issued in reinvestment of distributions | 3,781 | 47,944 | 859 | 8,819 | ||||||||||
Redeemed | (46,026) | (631,270) | (139,258) | (1,466,545) | ||||||||||
35,249 | 465,689 | (86,791) | (914,066) | |||||||||||
Net increase (decrease) | 1,099,507 | $ | 15,262,600 | (6,021,690) | $ | (58,197,577) |
6. Fair Value Measurements
The fund’s investments valuation process is based on several considerations and may use multiple inputs to determine the fair value of the investments held by the fund. In conformity with accounting principles generally accepted in the United States of America, the inputs used to determine a valuation are classified into three broad levels.
•Level 1 valuation inputs consist of unadjusted quoted prices in an active market for identical investments.
•Level 2 valuation inputs consist of direct or indirect observable market data (including quoted prices for comparable investments, evaluations of subsequent market events, interest rates, prepayment speeds, credit risk, etc.). These inputs also consist of quoted prices for identical investments initially expressed in local currencies that are adjusted through translation into U.S. dollars.
•Level 3 valuation inputs consist of unobservable data (including a fund’s own assumptions).
The level classification is based on the lowest level input that is significant to the fair valuation measurement. The valuation inputs are not necessarily an indication of the risks associated with investing in these securities or other financial instruments.
22
The following is a summary of the level classifications as of period end. The Schedule of Investments provides additional information on the fund’s portfolio holdings.
Level 1 | Level 2 | Level 3 | |||||||||
Assets | |||||||||||
Investment Securities | |||||||||||
Common Stocks | |||||||||||
Brazil | $ | 3,360,953 | $ | 7,916,665 | — | ||||||
Canada | 3,973,052 | 97,022,016 | — | ||||||||
China | 2,375,140 | 6,568,577 | — | ||||||||
India | 10,841,331 | 22,888,934 | — | ||||||||
Israel | 27,012,348 | — | — | ||||||||
Mexico | 1,382,158 | — | — | ||||||||
United Kingdom | 11,494,263 | 88,839,855 | — | ||||||||
Other Countries | — | 442,687,966 | — | ||||||||
Exchange-Traded Funds | 47,632 | — | — | ||||||||
Temporary Cash Investments | 11,695 | 3,267,458 | — | ||||||||
Temporary Cash Investments - Securities Lending Collateral | 2,947,763 | — | — | ||||||||
$ | 63,446,335 | $ | 669,191,471 | — |
7. Risk Factors
The value of the fund’s shares will go up and down, sometimes rapidly or unpredictably, based on the performance of the securities owned by the fund and other factors generally affecting the securities market. Market risks, including political, regulatory, economic and social developments, can affect the value of the fund’s investments. Natural disasters, public health emergencies, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse long-term effects on world economies and markets generally.
There are certain risks involved in investing in foreign securities. These risks include those resulting from political events (such as civil unrest, national elections and imposition of exchange controls), social and economic events (such as labor strikes and rising inflation), and natural disasters. Securities of foreign issuers may be less liquid and more volatile. Investing in emerging markets or a significant portion of assets in one country or region may accentuate these risks.
The fund invests in common stocks of small companies. Because of this, the fund may be subject to greater risk and market fluctuations than a fund investing in larger, more established companies.
The fund’s investment process may result in high portfolio turnover, which could mean high transaction costs, affecting both performance and capital gains tax liabilities to investors.
8. Federal Tax Information
On December 21, 2021, the fund declared and paid a per-share distribution from net realized gains to shareholders of record on December 20, 2021 of $2.0880 for the Investor Class, I Class, A Class, C Class and R Class.
On December 21, 2021, the fund declared and paid the following per-share distributions from net investment income to shareholders of record on December 20, 2021:
Investor Class | I Class | A Class | C Class | R Class | ||||||||||
$0.0463 | $0.0730 | $0.0130 | — | — |
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The tax character of distributions paid during the years ended November 30, 2021 and November 30, 2020 were as follows:
2021 | 2020 | |||||||
Distributions Paid From | ||||||||
Ordinary income | — | $ | 5,367,829 | |||||
Long-term capital gains | $ | 22,180,797 | $ | 338,793 |
The book-basis character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements.
As of period end, the federal tax cost of investments and the components of distributable earnings on a tax-basis were as follows:
Federal tax cost of investments | $ | 622,432,540 | |||
Gross tax appreciation of investments | $ | 145,422,385 | |||
Gross tax depreciation of investments | (35,217,119) | ||||
Net tax appreciation (depreciation) of investments | 110,205,266 | ||||
Net tax appreciation (depreciation) on translation of assets and liabilities in foreign currencies | (108,596) | ||||
Net tax appreciation (depreciation) | $ | 110,096,670 | |||
Undistributed ordinary income | $ | 18,482,818 | |||
Accumulated long-term gains | $ | 93,917,827 |
The difference between book-basis and tax-basis unrealized appreciation (depreciation) is attributable primarily to the tax deferral of losses on wash sales.
24
Financial Highlights |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Operating Expenses (before expense waiver) | Net Investment Income (Loss) | Net Investment Income (Loss) (before expense waiver) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||||||
Investor Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $12.95 | (0.04) | 1.31 | 1.27 | — | (0.43) | (0.43) | $13.79 | 10.01% | 1.37% | 1.37% | (0.30)% | (0.30)% | 127% | $576,312 | ||||||||||||||||||||||||||||||||
2020 | $10.17 | (0.01) | 2.89 | 2.88 | (0.10) | — | (0.10) | $12.95 | 28.52% | 1.40% | 1.40% | (0.12)% | (0.12)% | 131% | $565,150 | ||||||||||||||||||||||||||||||||
2019 | $9.33 | 0.01 | 1.13 | 1.14 | (0.05) | (0.25) | (0.30) | $10.17 | 12.88% | 1.46% | 1.46% | 0.23% | 0.23% | 124% | $499,296 | ||||||||||||||||||||||||||||||||
2018 | $11.94 | 0.01 | (1.51) | (1.50) | (0.06) | (1.05) | (1.11) | $9.33 | (13.98)% | 1.48% | 1.62% | 0.07% | (0.07)% | 140% | $131,043 | ||||||||||||||||||||||||||||||||
2017 | $8.49 | (0.01) | 3.46 | 3.45 | —(3) | — | —(3) | $11.94 | 40.69% | 1.53% | 1.73% | (0.11)% | (0.31)% | 124% | $163,540 | ||||||||||||||||||||||||||||||||
I Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $13.10 | (0.01) | 1.32 | 1.31 | — | (0.43) | (0.43) | $13.98 | 10.12% | 1.17% | 1.17% | (0.10)% | (0.10)% | 127% | $141,573 | ||||||||||||||||||||||||||||||||
2020 | $10.29 | 0.01 | 2.92 | 2.93 | (0.12) | — | (0.12) | $13.10 | 28.84% | 1.20% | 1.20% | 0.08% | 0.08% | 131% | $94,818 | ||||||||||||||||||||||||||||||||
2019 | $9.44 | 0.03 | 1.14 | 1.17 | (0.07) | (0.25) | (0.32) | $10.29 | 13.06% | 1.26% | 1.26% | 0.43% | 0.43% | 124% | $78,575 | ||||||||||||||||||||||||||||||||
2018 | $12.07 | 0.04 | (1.54) | (1.50) | (0.08) | (1.05) | (1.13) | $9.44 | (13.81)% | 1.28% | 1.42% | 0.27% | 0.13% | 140% | $53,224 | ||||||||||||||||||||||||||||||||
2017 | $8.58 | 0.02 | 3.49 | 3.51 | (0.02) | — | (0.02) | $12.07 | 41.01% | 1.33% | 1.53% | 0.09% | (0.11)% | 124% | $10,529 |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Operating Expenses (before expense waiver) | Net Investment Income (Loss) | Net Investment Income (Loss) (before expense waiver) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||||||
A Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $12.83 | (0.08) | 1.30 | 1.22 | — | (0.43) | (0.43) | $13.62 | 9.70% | 1.62% | 1.62% | (0.55)% | (0.55)% | 127% | $8,220 | ||||||||||||||||||||||||||||||||
2020 | $10.07 | (0.04) | 2.87 | 2.83 | (0.07) | — | (0.07) | $12.83 | 28.28% | 1.65% | 1.65% | (0.37)% | (0.37)% | 131% | $7,214 | ||||||||||||||||||||||||||||||||
2019 | $9.24 | (0.02) | 1.13 | 1.11 | (0.03) | (0.25) | (0.28) | $10.07 | 12.60% | 1.71% | 1.71% | (0.02)% | (0.02)% | 124% | $6,067 | ||||||||||||||||||||||||||||||||
2018 | $11.84 | (0.02) | (1.50) | (1.52) | (0.03) | (1.05) | (1.08) | $9.24 | (14.25)% | 1.73% | 1.87% | (0.18)% | (0.32)% | 140% | $8,131 | ||||||||||||||||||||||||||||||||
2017 | $8.43 | (0.03) | 3.44 | 3.41 | — | — | — | $11.84 | 40.45% | 1.78% | 1.98% | (0.36)% | (0.56)% | 124% | $12,855 | ||||||||||||||||||||||||||||||||
C Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $12.23 | (0.17) | 1.24 | 1.07 | — | (0.43) | (0.43) | $12.87 | 8.93% | 2.37% | 2.37% | (1.30)% | (1.30)% | 127% | $667 | ||||||||||||||||||||||||||||||||
2020 | $9.61 | (0.11) | 2.73 | 2.62 | — | — | — | $12.23 | 27.26% | 2.40% | 2.40% | (1.12)% | (1.12)% | 131% | $981 | ||||||||||||||||||||||||||||||||
2019 | $8.86 | (0.07) | 1.07 | 1.00 | — | (0.25) | (0.25) | $9.61 | 11.77% | 2.46% | 2.46% | (0.77)% | (0.77)% | 124% | $1,044 | ||||||||||||||||||||||||||||||||
2018 | $11.44 | (0.10) | (1.43) | (1.53) | — | (1.05) | (1.05) | $8.86 | (14.93)% | 2.48% | 2.62% | (0.93)% | (1.07)% | 140% | $1,411 | ||||||||||||||||||||||||||||||||
2017 | $8.21 | (0.11) | 3.34 | 3.23 | — | — | — | $11.44 | 39.46% | 2.53% | 2.73% | (1.11)% | (1.31)% | 124% | $2,453 | ||||||||||||||||||||||||||||||||
R Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $12.69 | (0.11) | 1.28 | 1.17 | — | (0.43) | (0.43) | $13.43 | 9.41% | 1.87% | 1.87% | (0.80)% | (0.80)% | 127% | $1,954 | ||||||||||||||||||||||||||||||||
2020 | $9.96 | (0.07) | 2.84 | 2.77 | (0.04) | — | (0.04) | $12.69 | 27.96% | 1.90% | 1.90% | (0.62)% | (0.62)% | 131% | $1,398 | ||||||||||||||||||||||||||||||||
2019 | $9.14 | (0.04) | 1.12 | 1.08 | (0.01) | (0.25) | (0.26) | $9.96 | 12.33% | 1.96% | 1.96% | (0.27)% | (0.27)% | 124% | $1,962 | ||||||||||||||||||||||||||||||||
2018 | $11.72 | (0.05) | (1.48) | (1.53) | —(3) | (1.05) | (1.05) | $9.14 | (14.46)% | 1.98% | 2.12% | (0.43)% | (0.57)% | 140% | $1,300 | ||||||||||||||||||||||||||||||||
2017 | $8.37 | (0.06) | 3.41 | 3.35 | — | — | — | $11.72 | 40.02% | 2.03% | 2.23% | (0.61)% | (0.81)% | 124% | $939 |
Notes to Financial Highlights |
(1)Computed using average shares outstanding throughout the period.
(2)Total returns are calculated based on the net asset value of the last business day and do not reflect applicable sales charges, if any. Total returns for periods less than one year are not annualized.
(3)Per-share amount was less than $0.005.
See Notes to Financial Statements.
Report of Independent Registered Public Accounting Firm |
To the Shareholders and the Board of Directors of American Century World Mutual Funds, Inc.:
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of International Opportunities Fund (the “Fund”), one of the funds constituting the American Century World Mutual Funds, Inc., as of November 30, 2021, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of International Opportunities Fund of the American Century World Mutual Funds, Inc. as of November 30, 2021, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund’s financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. 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, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of November 30, 2021, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
/s/ Deloitte & Touche LLP
Kansas City, Missouri
January 19, 2022
We have served as the auditor of one or more American Century investment companies since 1997.
28
Management |
The Board of Directors
The individuals listed below serve as directors of the funds. Each director will continue to serve in this capacity until death, retirement, resignation or removal from office. The board has adopted a mandatory retirement age for directors who are not “interested persons,” as that term is defined in the Investment Company Act (independent directors). Independent directors shall retire by December 31 of the year in which they reach their 75th birthday.
Jonathan S. Thomas is an “interested person” because he currently serves as President and Chief Executive Officer of American Century Companies, Inc. (ACC), the parent company of American Century Investment Management, Inc. (ACIM or the advisor). The other directors (more than three-fourths of the total number) are independent. They are not employees, directors or officers of, and have no financial interest in, ACC or any of its wholly owned, direct or indirect, subsidiaries, including ACIM, American Century Investment Services, Inc. (ACIS) and American Century Services, LLC (ACS), and they do not have any other affiliations, positions or relationships that would cause them to be considered “interested persons” under the Investment Company Act. The directors serve in this capacity for seven (in the case of Jonathan S. Thomas, 16; and Stephen E. Yates, 8) registered investment companies in the American Century Investments family of funds.
The following table presents additional information about the directors. The mailing address for each director is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Thomas W. Bunn (1953) | Director | Since 2017 | Retired | 72 | SquareTwo Financial; Barings (formerly Babson Capital Funds Trust) (2013 to 2016) | ||||||||||||
Chris H. Cheesman (1962) | Director | Since 2019 | Retired. Senior Vice President & Chief Audit Executive, AllianceBernstein (1999 to 2018) | 72 | Alleghany Corporation | ||||||||||||
Barry Fink (1955) | Director | Since 2012 (independent since 2016) | Retired | 72 | None | ||||||||||||
Rajesh K. Gupta (1960) | Director | Since 2019 | Partner Emeritus, SeaCrest Investment Management and SeaCrest Wealth Management (2019 to Present); Chief Executive Officer and Chief Investment Officer, SeaCrest Investment Management (2006 to 2019); Chief Executive Officer and Chief Investment Officer, SeaCrest Wealth Management (2008 to 2019) | 72 | None |
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Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Lynn Jenkins (1963) | Director | Since 2019 | Consultant, LJ Strategies (2019 to present); United States Representative, U.S. House of Representatives (2009 to 2018) | 72 | MGP Ingredients, Inc. (2019 to 2021) | ||||||||||||
Jan M. Lewis (1957) | Director | Since 2011 | Retired | 72 | None | ||||||||||||
John R. Whitten(1) (1946) | Director | Since 2008 | Retired | 72 | Onto Innovation Inc. (2019 to 2020); Rudolph Technologies, Inc. (2006 to 2019) | ||||||||||||
Stephen E. Yates (1948) | Director and Chairman of the Board | Since 2012 (Chairman since 2018) | Retired | 108 | None | ||||||||||||
Interested Director | |||||||||||||||||
Jonathan S. Thomas (1963) | Director | Since 2007 | President and Chief Executive Officer, ACC (2007 to present). Also serves as Chief Executive Officer, ACS; Director, ACC and other ACC subsidiaries | 146 | None |
(1) Effective December 31, 2021, John R. Whitten retired from the Board of Directors.
The Statement of Additional Information has additional information about the fund's directors and is available without charge, upon request, by calling 1-800-345-2021.
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Officers
The following table presents certain information about the executive officers of the funds. Each officer serves as an officer for each of the 16 (in the case of Robert J. Leach, 15) investment companies in the American Century family of funds. No officer is compensated for his or her service as an officer of the funds. The listed officers are interested persons of the funds and are appointed or re-appointed on an annual basis. The mailing address for each officer listed below is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Offices with the Funds | Principal Occupation(s) During the Past Five Years | ||||||
Patrick Bannigan (1965) | President since 2019 | Executive Vice President and Director, ACC (2012 to present); Chief Financial Officer, Chief Accounting Officer and Treasurer, ACC (2015 to present). Also serves as President, ACS; Vice President, ACIM; Chief Financial Officer, Chief Accounting Officer and/or Director, ACIM, ACS and other ACC subsidiaries | ||||||
R. Wes Campbell (1974) | Chief Financial Officer and Treasurer since 2018 | Vice President, ACS, (2020 to present); Investment Operations and Investment Accounting, ACS (2000 to present) | ||||||
Amy D. Shelton (1964) | Chief Compliance Officer and Vice President since 2014 | Chief Compliance Officer, American Century funds, (2014 to present); Chief Compliance Officer, ACIM (2014 to present); Chief Compliance Officer, ACIS (2009 to present). Also serves as Vice President, ACIS | ||||||
John Pak (1968) | General Counsel and Senior Vice President since 2021 | General Counsel and Senior Vice President, ACC (2021 to present). Also serves as General Counsel and Senior Vice President, ACIM, ACS and ACIS. Chief Legal Officer of Investment and Wealth Management, The Bank of New York Mellon (2014 to 2021) | ||||||
C. Jean Wade (1964) | Vice President since 2012 | Senior Vice President, ACS (2017 to present); Vice President, ACS (2000 to 2017) | ||||||
Robert J. Leach (1966) | Vice President since 2006 | Vice President, ACS (2000 to present) | ||||||
David H. Reinmiller (1963) | Vice President since 2000 | Attorney, ACC (1994 to present). Also serves as Vice President, ACIM and ACS | ||||||
Ward D. Stauffer (1960) | Secretary since 2005 | Attorney, ACC (2003 to present) |
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Approval of Management Agreement |
At a meeting held on June 30, 2021, the Fund’s Board of Directors (the "Board") unanimously approved the renewal of the management agreement pursuant to which American Century Investment Management, Inc. (the “Advisor”) acts as the investment advisor for the Fund. Under Section 15(c) of the Investment Company Act, contracts for investment advisory services are required to be reviewed, evaluated, and approved by a majority of a fund’s directors (the “Directors”), including a majority of the independent Directors, each year.
Prior to its consideration of the renewal of the management agreement, the Directors requested and reviewed extensive data and information compiled by the Advisor and certain independent providers of evaluation data concerning the Fund and the services provided to the Fund by the Advisor. This review was in addition to the oversight and evaluation undertaken by the Board and its committees on a continual basis and the information received was supplemental to the extensive information that the Board and its committees receive and consider throughout the year.
In connection with its consideration of the renewal of the management agreement, the Board’s review and evaluation of the services provided by the Advisor and its affiliates included, but was not limited to, the following:
•the nature, extent, and quality of investment management, shareholder services, and other services provided and to be provided to the Fund including without limitation portfolio management and trading services, shareholder and intermediary services, compliance and legal services, fund accounting and financial reporting, and fund share distribution;
•the wide range of other programs and services provided and to be provided to the Fund and its shareholders on a routine and non-routine basis;
•the Fund’s investment performance, including data comparing the Fund's performance to appropriate benchmarks and/or a peer group of other mutual funds with similar investment objectives and strategies;
•the cost of owning the Fund compared to the cost of owning similar funds;
•the compliance policies, procedures, and regulatory experience of the Advisor and the Fund's service providers;
•the Advisor’s strategic plans, COVID-19 pandemic response, vendor management practices, and social justice initiatives;
•the Advisor’s business continuity plans and cyber security practices;
•financial data showing the cost of services provided to the Fund, the profitability of the Fund to the Advisor, and the overall profitability of the Advisor;
•possible economies of scale associated with the Advisor’s management of the Fund and other accounts;
•services provided and charges to the Advisor's other investment management clients;
•acquired fund fees and expenses;
•payments and practices in connection with financial intermediaries holding shares of the Fund and the services provided by intermediaries in connection therewith; and
•possible collateral benefits to the Advisor from the management of the Fund.
The Board held two meetings to consider the renewal. The independent Directors also met in private session three times to review and discuss the information provided in response to their request. The independent Directors held active discussions with the Advisor regarding the renewal of the management agreement, requesting supplemental information, and reviewing information provided by the Advisor in response thereto. The independent Directors had the benefit of the advice of their independent counsel throughout the process.
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Factors Considered
The Directors considered all of the information provided by the Advisor, the independent data providers, and independent counsel in connection with the approval. They determined that the information was sufficient for them to evaluate the management agreement for the Fund. In connection with their review, the Directors did not identify any single factor as being all-important or controlling, and each Director may have attributed different levels of importance to different factors. In deciding to renew the management agreement, the Board based its decision on a number of factors, including without limitation the following:
Nature, Extent and Quality of Services — Generally. Under the management agreement, the Advisor is responsible for providing or arranging for all services necessary for the operation of the Fund. The Board noted that the Advisor provides or arranges at its own expense a wide variety of services which include the following:
•constructing and designing the Fund
•portfolio research and security selection
•initial capitalization/funding
•securities trading
•Fund administration
•custody of Fund assets
•daily valuation of the Fund’s portfolio
•liquidity monitoring and management
•risk management, including cyber security
•shareholder servicing and transfer agency, including shareholder confirmations, recordkeeping, and communications
•legal services (except the independent Directors’ counsel)
•regulatory and portfolio compliance
•financial reporting
•marketing and distribution (except amounts paid by the Fund under Rule 12b-1 plans)
The Board noted that many of these services have expanded over time in terms of both quantity and complexity in response to shareholder demands, competition in the industry, changing distribution channels, and the changing regulatory environment.
Investment Management Services. The nature of the investment management services provided to the Fund is quite complex and allows Fund shareholders access to professional money management, instant diversification of their investments within an asset class, the opportunity to easily diversify among asset classes by investing in or exchanging among various American Century Investments funds, and liquidity. In evaluating investment performance, the Board expects the Advisor to manage the Fund in accordance with its investment objectives and approved strategies. Further, the Directors recognize that the Advisor has an obligation to monitor trading activities, and in particular to seek the best execution of fund trades, and to evaluate the use of and payment for research. In providing these services, the Advisor utilizes teams of investment professionals (portfolio managers, analysts, research assistants, and securities traders) who require extensive information technology, research, training, compliance, and other systems to conduct their business. The Board, directly and through its Fund Performance Review Committee, provides oversight of the investment performance process. It regularly reviews investment performance information for the Fund, together with comparative information for appropriate benchmarks and/or peer groups of similarly-managed funds, over different time horizons. The Directors also review investment performance information during the management agreement renewal process. If performance concerns are identified, the Fund receives special reviews until performance improves, during which the Board discusses with the Advisor the reasons for such results (e.g., market conditions, security selection) and any efforts being undertaken to improve performance. The Fund’s performance was above its benchmark for the one-, three-, five-, and ten-year periods reviewed by the Board. The Board found the investment management services provided by the Advisor to the Fund to be satisfactory and consistent with the management agreement.
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Shareholder and Other Services. Under the management agreement, the Advisor provides the Fund with a comprehensive package of transfer agency, shareholder, and other services. The Board, directly and through its various committees, regularly reviews reports and evaluations of such services at its regular meetings. These reports include, but are not limited to, information regarding the operational efficiency and accuracy of the shareholder and transfer agency services provided, staffing levels, shareholder satisfaction, technology support (including cyber security), new products and services offered to Fund shareholders, securities trading activities, portfolio valuation services, auditing services, and legal and operational compliance activities. The Board found the services provided by the Advisor to the Fund under the management agreement to be competitive and of high quality.
Costs of Services and Profitability. The Advisor provides detailed information concerning its cost of providing various services to the Fund, its profitability in managing the Fund (pre- and post-distribution), its overall profitability, and its financial condition. The Directors have reviewed with the Advisor the methodology used to prepare this financial information. This information is considered in evaluating the Advisor’s financial condition, its ability to continue to provide services under the management agreement, and the reasonableness of the current management fee. The Board concluded that the Advisor’s profits were reasonable in light of the services provided to the Fund.
Ethics. The Board generally considers the Advisor’s commitment to providing quality services to shareholders and to conducting its business ethically. They noted that the Advisor’s practices generally meet or exceed industry best practices.
Economies of Scale. The Board also reviewed information provided by the Advisor regarding the possible existence of economies of scale in connection with the management of the Fund. The Board concluded that economies of scale are difficult to measure and predict with precision, especially on a fund-by-fund basis. The Board concluded that the Advisor is sharing economies of scale, to the extent they exist, through its competitive fee structure, offering competitive fees from fund inception, and through reinvestment in its business, infrastructure, investment capabilities and initiatives to provide shareholders additional content and services. The Board also noted that economies of scale are shared with the Fund and its shareholders through management fee breakpoints that serve to reduce the effective management fee as the assets of the Fund grow.
Comparison to Other Funds’ Fees. The management agreement provides that the Fund pays the Advisor a single, all-inclusive (or unified) management fee for providing all services necessary for the management and operation of the Fund, other than brokerage expenses, expenses attributable to short sales, taxes, interest, extraordinary expenses, fees and expenses of the Fund’s independent Directors (including their independent legal counsel), and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the Investment Company Act. Under the unified fee structure, the Advisor is responsible for providing all investment advisory, custody, audit, administrative, compliance, recordkeeping, marketing and shareholder services, or arranging and supervising third parties to provide such services. By contrast, most other funds are charged a variety of fees, including an investment advisory fee, a transfer agency fee, an administrative fee, distribution charges, and other expenses. Other than their investment advisory fees and any applicable Rule 12b-1 distribution fees, all other components of the total fees charged by these other funds may be increased without shareholder approval. The Board believes the unified fee structure is a benefit to Fund shareholders because it clearly discloses to shareholders the cost of owning Fund shares, and, since the unified fee cannot be increased without a vote of Fund shareholders, it shifts to the Advisor the risk of increased costs of operating the Fund and provides a direct incentive to minimize administrative inefficiencies. Part of the Board’s analysis of fee levels involves reviewing certain evaluative data compiled by an independent provider comparing the Fund’s unified fee to the total expense ratios of its peers. The unified fee charged to shareholders of the Fund was above the median of the total expense ratios of the Fund’s peer expense universe. In addition, the Board reviewed the Fund’s position relative to the narrower set of its expense group peers. The Board concluded that the management fee paid by the Fund to the Advisor under the management agreement is reasonable in light of the services provided to the Fund.
Comparison to Fees and Services Provided to Other Clients of the Advisor. The Board also requested and received information from the Advisor concerning the nature of the services, fees,
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costs, and profitability of its advisory services to advisory clients other than the Fund. They observed that these varying types of client accounts require different services and involve different regulatory and entrepreneurial risks than the management of the Fund. The Board analyzed this information and concluded that the fees charged and services provided to the Fund were reasonable by comparison.
Payments to Intermediaries. The Directors also requested and received a description of payments made to intermediaries by the Fund and the Advisor and services provided in response thereto. These payments include various payments made by the Fund or the Advisor to different types of intermediaries and recordkeepers for distribution and service activities provided for the Fund. The Directors reviewed such information and received representations from the Advisor that all such payments by the Fund were made pursuant to the Fund's Rule 12b-1 Plan and that all such payments by the Advisor were made from the Advisor’s resources and reasonable profits. The Board found such payments to be reasonable in scope and purpose.
Collateral or “Fall-Out” Benefits Derived by the Advisor. The Board considered the possible existence of collateral benefits the Advisor may receive as a result of its relationship with the Fund. They concluded that the Advisor’s primary business is managing funds and it generally does not use fund or shareholder information to generate profits in other lines of business, and therefore does not derive any significant collateral benefits from them. To the extent there are potential collateral benefits, the Board has been advised and has taken this into consideration in its review of the management contract with the Fund. The Board noted that additional assets from other clients may offer the Advisor some benefit from increased leverage with service providers and counterparties. Additionally, the Advisor may receive proprietary research from broker-dealers that execute fund portfolio transactions, which the Board concluded is likely to benefit other clients of the Advisor, as well as Fund shareholders. The Board also determined that the Advisor is able to provide investment management services to certain clients other than the Fund, at least in part, due to its existing infrastructure built to serve the fund complex. The Board concluded that appropriate allocation methodologies had been employed to assign resources and the cost of those resources to these other clients and, where expressly provided, these other client assets may be included with the assets of the Fund to determine breakpoints in the management fee schedule.
Existing Relationship. The Board also considered whether there was any reason for not continuing the existing arrangement with the Advisor. In this regard, the Board was mindful of the potential disruptions of the Fund’s operations and various risks, uncertainties, and other effects that could occur as a result of a decision not to continue such relationship. In particular, the Board recognized that most shareholders have invested in the Fund on the strength of the Advisor’s industry standing and reputation and in the expectation that the Advisor will have a continuing role in providing advisory services to the Fund.
Conclusion of the Directors. As a result of this process, the Board, including all of the independent Directors, taking into account all of the factors discussed above and the information provided by the Advisor and others in connection with its review and throughout the year, determined that the management fee is fair and reasonable in light of the services provided and that the investment management agreement between the Fund and the Advisor should be renewed.
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Additional Information |
Retirement Account Information
As required by law, distributions you receive from certain retirement accounts are subject to federal income tax withholding, unless you elect not to have withholding apply*. Tax will be withheld on the total amount withdrawn even though you may be receiving amounts that are not subject to withholding, such as nondeductible contributions. In such case, excess amounts of withholding could occur. You may adjust your withholding election so that a greater or lesser amount will be withheld.
If you don’t want us to withhold on this amount, you must notify us to not withhold the federal income tax. You may notify us in writing or in certain situations by telephone or through other electronic means. For systematic withdrawals, your withholding election will remain in effect until revoked or changed by filing a new election. You have the right to revoke your election at any time and change your withholding percentage for future distributions.
Remember, even if you elect not to have income tax withheld, you are liable for paying income tax on the taxable portion of your withdrawal. If you elect not to have income tax withheld or you don’t have enough income tax withheld, you may be responsible for payment of estimated tax. You may incur penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. You can reduce or defer the income tax on a distribution by directly or indirectly rolling such distribution over to another IRA or eligible plan. You should consult your tax advisor for additional information.
State tax will be withheld if, at the time of your distribution, your address is within one of the mandatory withholding states and you have federal income tax withheld (or as otherwise required by state law). State taxes will be withheld from your distribution in accordance with the respective state rules.
*Some 403(b), 457 and qualified retirement plan distributions may be subject to 20% mandatory withholding, as they are subject to special tax and withholding rules. Your plan administrator or plan sponsor is required to provide you with a special tax notice explaining those rules at the time you request a distribution. If applicable, federal and/or state taxes may be withheld from your distribution amount.
Proxy Voting Policies
A description of the policies that the fund's investment advisor uses in exercising the voting rights associated with the securities purchased and/or held by the fund is available without charge, upon request, by calling 1-800-345-2021. It is also available on American Century Investments’ website at americancentury.com/proxy and on the Securities and Exchange Commission’s website at sec.gov. Information regarding how the investment advisor voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on americancentury.com/proxy. It is also available at sec.gov.
Quarterly Portfolio Disclosure
The fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. These portfolio holdings are available on the fund's website at americancentury.com and, upon request, by calling 1-800-345-2021. The fund’s Form N-PORT reports are available on the SEC’s website at sec.gov.
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Other Tax Information
The following information is provided pursuant to provisions of the Internal Revenue Code.
The funds hereby designates up to the maximum amount allowable as qualified dividend income for the fiscal year ended November 30, 2021.
The fund hereby designates $27,674,874, or up to the maximum amount allowable, as long-term capital gain distributions (20% rate gain distributions) for the fiscal year ended November 30, 2021.
The fund hereby designates $923,040 as qualified short-term capital gain distributions for purposes of Internal Revenue Code Section 871 for the fiscal year ended November 30, 2021.
For the fiscal year ended November 30, 2021, the fund intends to pass through to shareholders foreign source income of $8,219,701 and foreign taxes paid of $295,297, or up to the maximum amount allowable, as a foreign tax credit. Foreign source income and foreign tax expense per outstanding share on November 30, 2021 are $0.1559 and $0.0056, respectively.
The fund utilized earnings and profits of $6,589,357 distributed to shareholders on redemption of shares as part of the dividends paid deduction (tax equalization).
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Notes |
38
Notes |
39
Notes |
40
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Contact Us | americancentury.com | |||||||
Automated Information Line | 1-800-345-8765 | |||||||
Investor Services Representative | 1-800-345-2021 or 816-531-5575 | |||||||
Investors Using Advisors | 1-800-378-9878 | |||||||
Business, Not-For-Profit, Employer-Sponsored Retirement Plans | 1-800-345-3533 | |||||||
Banks and Trust Companies, Broker-Dealers, Financial Professionals, Insurance Companies | 1-800-345-6488 | |||||||
Telecommunications Relay Service for the Deaf | 711 | |||||||
American Century World Mutual Funds, Inc. | ||||||||
Investment Advisor: American Century Investment Management, Inc. Kansas City, Missouri | ||||||||
This report and the statements it contains are submitted for the general information of our shareholders. The report is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. | ||||||||
©2022 American Century Proprietary Holdings, Inc. All rights reserved. CL-ANN-91032 2201 |
![image37.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image37.jpg)
Annual Report | |||||
November 30, 2021 | |||||
International Value Fund | |||||
Investor Class (ACEVX) | |||||
I Class (ACVUX) | |||||
A Class (MEQAX) | |||||
C Class (ACCOX) | |||||
R Class (ACVRX) | |||||
R6 Class (ACVDX) |
Table of Contents |
President’s Letter | |||||
Performance | |||||
Portfolio Commentary | |||||
Fund Characteristics | |||||
Shareholder Fee Example | |||||
Schedule of Investments | |||||
Statement of Assets and Liabilities | |||||
Statement of Operations | |||||
Statement of Changes in Net Assets | |||||
Notes to Financial Statements | |||||
Financial Highlights | |||||
Report of Independent Registered Public Accounting Firm | |||||
Management | |||||
Approval of Management Agreement | |||||
Additional Information |
Any opinions expressed in this report reflect those of the author as of the date of the report, and do not necessarily represent the opinions of American Century Investments® or any other person in the American Century Investments organization. Any such opinions are subject to change at any time based upon market or other conditions and American Century Investments disclaims any responsibility to update such opinions. These opinions may not be relied upon as investment advice and, because investment decisions made by American Century Investments funds are based on numerous factors, may not be relied upon as an indication of trading intent on behalf of any American Century Investments fund. Security examples are used for representational purposes only and are not intended as recommendations to purchase or sell securities. Performance information for comparative indices and securities is provided to American Century Investments by third party vendors. To the best of American Century Investments’ knowledge, such information is accurate at the time of printing.
President’s Letter |
![image30a.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image30a.jpg)
Dear Investor:
Thank you for reviewing this annual report for the period ended November 30, 2021. Annual reports help convey important information about fund returns, including market factors that affected performance. For additional investment insights, please visit americancentury.com.
Global Stocks Advanced Despite Lingering and New Challenges
Global stocks broadly delivered solid gains for the 12-month period, even as pandemic-related challenges persisted. Improving economic data, along with central bank and government support and positive vaccine developments, helped boost corporate earnings and promote investor optimism. The U.S. generally outpaced other nations. Virus outbreaks and slower vaccine rollouts, particularly in emerging markets, led to lingering lockdowns in some regions.
As the period progressed, steady economic gains combined with ongoing monetary and fiscal support, rising energy prices and severe supply chain disruptions pushed global interest rates and inflation higher. In the U.S., year-over-year headline inflation climbed to 6.8% in November 2021, the largest 12-month increase in nearly 40 years. Similarly, inflation in the eurozone hit a 30-year high, while prices in the U.K. climbed to their highest level in 10 years.
Late in the period, the Federal Reserve began tapering its bond buying while adopting a more hawkish rate-tightening outlook amid surging inflation. However, central banks in Europe and the U.K. maintained their supportive programs, expressing concerns about slowing global growth outlooks. Meanwhile, the emergence of a new COVID-19 variant in late November triggered a steep sell-off among global stocks to end the reporting period.
Despite mounting inflation worries and late-period volatility, global stocks delivered solid performance for the full 12 months, highlighted by strong gains in developed markets. Emerging markets stocks generally delivered more modest returns.
Several Factors Shaping Market Dynamics
The return to pre-pandemic life is progressing, albeit somewhat cautiously due to COVID-19’s lingering effects. As the economy and markets respond to this fluid backdrop, investors will face opportunities and ongoing challenges. Economic growth, inflation, the virus’s trajectory, supply chain normalization and fiscal and monetary policy likely will sway market dynamics.
We appreciate your confidence in us during these extraordinary times. Our firm has a long history of helping clients weather unpredictable markets, and we’re confident we will continue to meet today’s challenges.
Sincerely,
![image23.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image23.jpg)
Jonathan Thomas
President and Chief Executive Officer
American Century Investments
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Performance |
Total Returns as of November 30, 2021 | ||||||||||||||||||||
Average Annual Returns | ||||||||||||||||||||
Ticker Symbol | 1 year | 5 years | 10 years | Since Inception | Inception Date | |||||||||||||||
Investor Class | ACEVX | 9.30% | 5.51% | 4.92% | — | 4/3/06 | ||||||||||||||
MSCI EAFE Value Index | — | 9.29% | 5.07% | 5.13% | — | — | ||||||||||||||
I Class | ACVUX | 9.54% | 5.72% | 5.13% | — | 4/3/06 | ||||||||||||||
A Class | MEQAX | 3/31/97 | ||||||||||||||||||
No sales charge | 9.10% | 5.26% | 4.65% | — | ||||||||||||||||
With sales charge | 2.82% | 4.03% | 4.04% | — | ||||||||||||||||
C Class | ACCOX | 8.19% | 4.47% | 3.88% | — | 4/3/06 | ||||||||||||||
R Class | ACVRX | 8.73% | 4.99% | 4.39% | — | 4/3/06 | ||||||||||||||
R6 Class | ACVDX | 9.71% | 5.89% | — | 3.37% | 7/26/13 |
Average annual returns since inception are presented when ten years of performance history is not available.
C Class shares will automatically convert to A Class shares after being held for approximately eight years. C
Class average annual returns do not reflect this conversion.
Sales charges include initial sales charges and contingent deferred sales charges (CDSCs), as applicable. A Class shares have a 5.75% maximum initial sales charge and may be subject to a maximum CDSC of 1.00%. C Class shares redeemed within 12 months of purchase are subject to a maximum CDSC of 1.00%. The SEC requires that mutual funds provide performance information net of maximum sales charges in all cases where charges could be applied.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
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Growth of $10,000 Over 10 Years | ||
$10,000 investment made November 30, 2011 | ||
Performance for other share classes will vary due to differences in fee structure. |
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Value on November 30, 2021 | |||||
Investor Class — $16,177 | |||||
MSCI EAFE Value Index — $16,504 | |||||
Total Annual Fund Operating Expenses | |||||||||||||||||
Investor Class | I Class | A Class | C Class | R Class | R6 Class | ||||||||||||
1.11% | 0.91% | 1.36% | 2.11% | 1.61% | 0.76% |
The total annual fund operating expenses shown is as stated in the fund’s prospectus current as of the date of this report. The prospectus may vary from the expense ratio shown elsewhere in this report because it is based on a different time period, includes acquired fund fees and expenses, and, if applicable, does not include fee waivers or expense reimbursements.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
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Portfolio Commentary |
Portfolio Managers: Yulin Long and Tsuyoshi Ozaki
Performance Summary
International Value rose 9.30%* for the fiscal year ended November 30, 2021, compared with the 9.29% return of its benchmark, the MSCI EAFE Value Index. Fund results reflect operating expenses, while benchmark returns do not.
Global stocks delivered positive returns early in the reporting period, supported by improving corporate earnings. The vaccine rollout and predictions for better global economic growth also boosted equity performance. Expectations for accelerating economic improvement drove a rotation into cyclical stocks early in the period, which led value stocks to outperform growth. Later, several headwinds emerged, including COVID-19’s delta variant, supply chain disruptions, soaring inflation and rising yields. These eventually dampened the economic outlook and stock returns. Higher input costs and logistics challenges raised worries that profit margins could weaken in the near term. Global policymakers at central banks in England, Japan and the European Union signaled they likely would begin tapering asset purchases before year-end. A surge in credit problems for property developer China Evergrande Group late in the period also raised fears of a wider global credit crisis. In that environment, non-U.S. stock returns were volatile and declined from earlier highs, but nevertheless finished the period with solid gains.
Our stock selection process incorporates factors of valuation, quality, growth and sentiment, while minimizing unintended risks among industries and other risk characteristics. The consumer staples and health care sectors contributed the most to the fund’s relative returns. Positioning in the utilities and real estate sectors also contributed. Selection and allocation decisions made the industrials, energy, communication services and financials sectors detractors from relative performance.
Geographically, stock choices within Israel, the U.S. and Switzerland contributed the most to relative returns. In contrast, security selection in Japan, Finland and Sweden detracted from the fund’s results.
Consumer Staples and Health Care Stocks Drive Contribution
In the consumer staples sector, positioning in the beverages industry was a top contributor to the fund’s outperformance. It helped relative results to be underweight Anheuser-Busch InBev, which was hurt by supply chain bottlenecks that caused demand for aluminum cans to surge and resulted in delivery delays. In the personal products industry, limited exposure to the British company Unilever was beneficial. The company said inflation had impacted input costs and pandemic-related shutdowns in Asia had hurt sales volumes. An overweight position in Jeronimo Martins, a Portuguese food retailer, added to performance as well. The company’s shares benefited from a market rotation into more defensive stocks.
In the health care sector, stock selection in the pharmaceuticals industry was the primary driver. The decision to limit exposure to several large pharmaceuticals stocks, including Novartis, Bayer and Sanofi, was beneficial, and we exited our position in Bayer. In addition, an overweight position in Novo Nordisk was also advantageous. A strong product pipeline and anticipated gains in the diabetes treatment market helped support shares.
*All fund returns referenced in this commentary are for Investor Class shares. Performance for other share classes will vary due to differences in fee structure; when Investor Class performance exceeds that of the fund’s benchmark, other share classes may not. See page 3 for returns for all share classes.
5
A large underweight position in the utilities sector added to relative performance as well. In the electric utilities industry, a decision to underweight shares of Enel, an Italian power company, contributed positively to results. The company reported lower sales and income due in part to lower energy trading activity in Italy and to unfavorable exchange rates with Latin America. In the real estate sector, a decision to avoid Vonovia, a Germany-based apartment developer, was also advantageous. Shares of Vonovia were hindered by doubts about the company’s attempted merger with another German apartment developer.
Elsewhere, U.K.-based Evraz, a steel manufacturing and mining company, contributed prominently to relative performance. Shares of the metals company moved higher on an improved earnings outlook.
Industrials Sector Detracted from Relative Results
Positioning in the industrials sector, particularly in the aerospace and defense and machinery industries, detracted from the fund’s relative returns. In the aerospace and defense industry, limited exposure to Airbus hindered results as did an overweight position in Safran, a France-based maker of aircraft and rocket engines. Shares of Airbus rose on strong earnings and upgrade guidance, while shares of Safran fell on weaker sales and earnings. We exited our position in Safran.
In the machinery industry, an overweight position was detrimental as were certain stock selections. For example, shares of Kone, a Finland-based company that makes elevators and escalators, declined due to parts shortages and rising input costs. We exited this position during the period. An overweight to the airlines industry also hindered relative performance.
Overweight exposure to Japan-based Nintendo, a video game company, also weighed on relative returns. The company’s stock declined due to earnings that were weaker relative to pandemic-related strength in 2020. An underweight position in Toyota Motor also detracted from performance. The company reported strong earnings in 2021 and raised its guidance for 2022.
Portfolio Positioning
With 2022 on the horizon, global economies continue to confront higher inflation, potentially slower economic growth and continued uncertainty surrounding the coronavirus pandemic. We believe our disciplined investment approach can be particularly beneficial during periods of volatility, and we adhere to our process regardless of the market environment. We believe this allows us to take advantage of opportunities presented by market inefficiencies. We seek to maintain balanced exposure to our fundamentally based, multidimensional drivers of stock returns, applying bottom-up research and analysis on individual stocks to determine positioning. We also seek to limit active risk at the country, sector and industry level, and we typically allow only modest overweights and underweights. As of November 30, 2021, the fund’s largest overweight positions are in the consumer discretionary and information technology sectors. The fund’s largest underweights are in the utilities and real estate sectors. Geographically, the fund is overweight particularly in the U.S., Israel, France and Netherlands and underweight in Europe, particularly to Germany, Switzerland and the U.K.
6
Fund Characteristics |
NOVEMBER 30, 2021 | |||||
Types of Investments in Portfolio | % of net assets | ||||
Common Stocks | 98.2% | ||||
Temporary Cash Investments | 1.3% | ||||
Other Assets and Liabilities | 0.5% | ||||
Top Five Countries | % of net assets | ||||
Japan | 23.6% | ||||
United Kingdom | 14.3% | ||||
France | 13.7% | ||||
United States | 7.1% | ||||
Germany | 6.6% |
7
Shareholder Fee Example |
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption/exchange fees; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in your fund and to compare these costs with the ongoing cost of investing in other mutual funds.
The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period from May 29, 2021 to November 30, 2021.
Actual Expenses
The table provides information about actual account values and actual expenses for each class. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. First, identify the share class you own. Then simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
If you hold Investor Class shares of any American Century Investments fund, or I Class shares of the American Century Diversified Bond Fund, in an American Century Investments account (i.e., not through a financial intermediary or employer-sponsored retirement plan account), American Century Investments may charge you a $25.00 annual account maintenance fee if the value of those shares is less than $10,000. We will redeem shares automatically in one of your accounts to pay the $25.00 fee. In determining your total eligible investment amount, we will include your investments in all personal accounts (including American Century Investments brokerage accounts) registered under your Social Security number. Personal accounts include individual accounts, joint accounts, UGMA/UTMA accounts, personal trusts, Coverdell Education Savings Accounts and IRAs (including traditional, Roth, Rollover, SEP-, SARSEP- and SIMPLE-IRAs), and certain other retirement accounts. If you have only business, business retirement, employer-sponsored or American Century Investments brokerage accounts, you are currently not subject to this fee. If you are subject to the account maintenance fee, your account value could be reduced by the fee amount.
Hypothetical Example for Comparison Purposes
The table also provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each class of your fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of a fund’s share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption/exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
8
Beginning Account Value 5/29/21 | Ending Account Value 11/30/21 | Expenses Paid During Period(1) 5/29/21 - 11/30/21 | Annualized Expense Ratio(1) | |||||||||||
Actual | ||||||||||||||
Investor Class | $1,000 | $915.80 | $5.37 | 1.10% | ||||||||||
I Class | $1,000 | $916.70 | $4.40 | 0.90% | ||||||||||
A Class | $1,000 | $914.20 | $6.58 | 1.35% | ||||||||||
C Class | $1,000 | $910.80 | $10.22 | 2.10% | ||||||||||
R Class | $1,000 | $913.80 | $7.80 | 1.60% | ||||||||||
R6 Class | $1,000 | $917.70 | $3.66 | 0.75% | ||||||||||
Hypothetical | ||||||||||||||
Investor Class | $1,000 | $1,019.87 | $5.66 | 1.10% | ||||||||||
I Class | $1,000 | $1,020.89 | $4.63 | 0.90% | ||||||||||
A Class | $1,000 | $1,018.60 | $6.94 | 1.35% | ||||||||||
C Class | $1,000 | $1,014.78 | $10.78 | 2.10% | ||||||||||
R Class | $1,000 | $1,017.33 | $8.22 | 1.60% | ||||||||||
R6 Class | $1,000 | $1,021.66 | $3.86 | 0.75% |
(1)Expenses are equal to the class's annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 186, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. Annualized expense ratio reflects actual expenses, including any applicable fee waivers or expense reimbursements and excluding any acquired fund fees and expenses.
9
Schedule of Investments |
NOVEMBER 30, 2021
Shares | Value | |||||||
COMMON STOCKS — 98.2% | ||||||||
Australia — 4.8% | ||||||||
Aristocrat Leisure Ltd. | 24,174 | $ | 751,333 | |||||
Coles Group Ltd. | 19,750 | 252,203 | ||||||
Commonwealth Bank of Australia | 1,890 | 124,780 | ||||||
National Australia Bank Ltd. | 35,703 | 689,891 | ||||||
Qantas Airways Ltd.(1) | 66,759 | 238,643 | ||||||
Rio Tinto Ltd. | 1,343 | 89,112 | ||||||
Santos Ltd. | 70,939 | 319,880 | ||||||
Stockland, REIT | 146,347 | 451,815 | ||||||
Suncorp Group Ltd. | 19,689 | 150,859 | ||||||
Wesfarmers Ltd. | 8,025 | 323,483 | ||||||
3,391,999 | ||||||||
Austria — 1.2% | ||||||||
Raiffeisen Bank International AG | 9,721 | 289,102 | ||||||
voestalpine AG | 16,933 | 571,447 | ||||||
860,549 | ||||||||
Belgium — 0.8% | ||||||||
Solvay SA | 5,168 | 578,240 | ||||||
Denmark — 0.5% | ||||||||
Novo Nordisk A/S, B Shares | 3,536 | 378,529 | ||||||
Finland — 0.3% | ||||||||
Fortum Oyj | 7,130 | 205,003 | ||||||
France — 13.7% | ||||||||
Airbus SE(1) | 5,513 | 615,361 | ||||||
Arkema SA | 2,115 | 277,322 | ||||||
AXA SA | 13,509 | 371,336 | ||||||
BNP Paribas SA | 9,118 | 566,680 | ||||||
Cie de Saint-Gobain | 11,934 | 756,970 | ||||||
Cie Generale des Etablissements Michelin SCA | 6,347 | 936,629 | ||||||
Dassault Systemes SE | 5,274 | 317,922 | ||||||
EssilorLuxottica SA | 1,905 | 381,777 | ||||||
Hermes International | 220 | 412,853 | ||||||
L'Oreal SA | 397 | 179,260 | ||||||
Legrand SA | 8,990 | 987,596 | ||||||
Publicis Groupe SA | 10,049 | 650,259 | ||||||
Sanofi | 2,437 | 231,667 | ||||||
Schneider Electric SE | 6,957 | 1,234,686 | ||||||
STMicroelectronics NV | 4,779 | 232,746 | ||||||
Thales SA | 2,582 | 211,843 | ||||||
TotalEnergies SE | 26,448 | 1,216,946 | ||||||
Veolia Environnement SA | 2,024 | 64,908 | ||||||
9,646,761 | ||||||||
Germany — 6.6% | ||||||||
Allianz SE | 4,296 | 932,349 | ||||||
Brenntag SE | 6,800 | 582,423 | ||||||
Carl Zeiss Meditec AG | 2,759 | 552,765 | ||||||
Deutsche Post AG | 4,697 | 277,412 |
10
Shares | Value | |||||||
E.ON SE | 27,599 | $ | 340,471 | |||||
GEA Group AG | 13,977 | 707,343 | ||||||
Merck KGaA | 379 | 93,672 | ||||||
Siemens AG | 3,986 | 635,430 | ||||||
Telefonica Deutschland Holding AG | 65,642 | 175,076 | ||||||
Uniper SE | 6,817 | 295,966 | ||||||
Vitesco Technologies Group AG(1) | 870 | 38,677 | ||||||
4,631,584 | ||||||||
Hong Kong — 1.3% | ||||||||
Hong Kong Exchanges & Clearing Ltd. | 10,700 | 588,408 | ||||||
Sun Hung Kai Properties Ltd. | 27,500 | 334,859 | ||||||
923,267 | ||||||||
Ireland — 1.3% | ||||||||
CRH plc | 18,595 | 903,990 | ||||||
Israel — 3.6% | ||||||||
Bank Leumi Le-Israel BM | 101,690 | 978,523 | ||||||
Israel Discount Bank Ltd., A Shares(1) | 139,223 | 850,766 | ||||||
Mizrahi Tefahot Bank Ltd. | 18,859 | 693,469 | ||||||
2,522,758 | ||||||||
Italy — 2.7% | ||||||||
CNH Industrial NV | 11,619 | 190,716 | ||||||
Enel SpA | 41,406 | 313,748 | ||||||
FinecoBank Banca Fineco SpA | 31,147 | 545,508 | ||||||
Mediobanca Banca di Credito Finanziario SpA | 27,207 | 300,957 | ||||||
Tenaris SA | 54,138 | 530,168 | ||||||
1,881,097 | ||||||||
Japan — 23.6% | ||||||||
AGC, Inc. | 3,600 | 175,309 | ||||||
Bridgestone Corp. | 8,000 | 320,788 | ||||||
Brother Industries Ltd. | 31,400 | 538,901 | ||||||
Canon, Inc. | 39,700 | 873,111 | ||||||
Capcom Co., Ltd. | 11,800 | 293,706 | ||||||
Dai Nippon Printing Co. Ltd. | 5,700 | 133,780 | ||||||
ENEOS Holdings, Inc. | 113,600 | 421,714 | ||||||
FUJIFILM Holdings Corp. | 10,000 | 786,611 | ||||||
Fujitsu Ltd. | 1,100 | 181,812 | ||||||
Hoya Corp. | 3,100 | 490,688 | ||||||
Iida Group Holdings Co. Ltd. | 30,300 | 625,706 | ||||||
INPEX Corp. | 35,100 | 287,209 | ||||||
Japan Airlines Co. Ltd.(1) | 8,700 | 156,827 | ||||||
Japan Exchange Group, Inc. | 11,600 | 251,153 | ||||||
Japan Post Insurance Co. Ltd. | 23,200 | 358,382 | ||||||
JFE Holdings, Inc. | 11,000 | 125,376 | ||||||
KDDI Corp. | 31,200 | 905,273 | ||||||
Lixil Corp. | 6,300 | 154,123 | ||||||
Mitsubishi Corp. | 10,300 | 306,265 | ||||||
Mitsubishi Electric Corp. | 60,700 | 758,431 | ||||||
Mitsubishi UFJ Financial Group, Inc. | 58,900 | 311,073 | ||||||
Mitsui & Co. Ltd. | 15,500 | 348,493 | ||||||
MS&AD Insurance Group Holdings, Inc. | 16,900 | 492,781 | ||||||
Nintendo Co. Ltd. | 600 | 264,611 | ||||||
Nippon Yusen KK | 2,700 | 174,876 |
11
Shares | Value | |||||||
Nitto Denko Corp. | 1,900 | $ | 131,725 | |||||
Oriental Land Co. Ltd. | 1,200 | 188,562 | ||||||
ORIX Corp. | 25,800 | 508,348 | ||||||
Otsuka Holdings Co. Ltd. | 3,400 | 123,147 | ||||||
Panasonic Corp. | 46,600 | 508,058 | ||||||
Renesas Electronics Corp.(1) | 20,900 | 262,615 | ||||||
Seiko Epson Corp. | 27,200 | 438,558 | ||||||
Seven & i Holdings Co. Ltd. | 4,700 | 189,304 | ||||||
Shionogi & Co. Ltd. | 7,400 | 516,603 | ||||||
Shizuoka Bank Ltd. (The) | 72,200 | 507,571 | ||||||
Softbank Corp. | 8,000 | 110,116 | ||||||
Sompo Holdings, Inc. | 4,000 | 164,272 | ||||||
Sony Group Corp. | 6,300 | 768,655 | ||||||
Sumitomo Chemical Co. Ltd. | 149,800 | 687,140 | ||||||
Tokyo Electron Ltd. | 600 | 315,282 | ||||||
Toyota Motor Corp. | 39,500 | 700,700 | ||||||
Yamaha Motor Co. Ltd. | 30,100 | 756,971 | ||||||
16,614,626 | ||||||||
Netherlands — 4.0% | ||||||||
Koninklijke Ahold Delhaize NV | 33,235 | 1,118,349 | ||||||
NN Group NV | 8,659 | 430,261 | ||||||
Randstad NV | 7,214 | 455,210 | ||||||
Wolters Kluwer NV | 7,284 | 819,165 | ||||||
2,822,985 | ||||||||
New Zealand — 0.3% | ||||||||
Fisher & Paykel Healthcare Corp. Ltd. | 10,648 | 240,917 | ||||||
Norway — 1.4% | ||||||||
Equinor ASA | 11,937 | 298,675 | ||||||
Yara International ASA | 14,549 | 714,214 | ||||||
1,012,889 | ||||||||
Portugal — 1.5% | ||||||||
EDP Renovaveis SA | 6,752 | 173,662 | ||||||
Jeronimo Martins SGPS SA | 41,372 | 902,712 | ||||||
1,076,374 | ||||||||
Singapore — 2.1% | ||||||||
DBS Group Holdings Ltd. | 33,213 | 723,465 | ||||||
Singapore Telecommunications Ltd. | 122,800 | 211,451 | ||||||
United Overseas Bank Ltd. | 29,400 | 550,254 | ||||||
1,485,170 | ||||||||
Spain — 2.7% | ||||||||
Banco Bilbao Vizcaya Argentaria SA | 202,372 | 1,072,900 | ||||||
Industria de Diseno Textil SA | 16,038 | 506,972 | ||||||
Naturgy Energy Group SA(2) | 11,278 | 311,136 | ||||||
1,891,008 | ||||||||
Sweden — 0.6% | ||||||||
Husqvarna AB, B Shares | 548 | 7,715 | ||||||
Lundin Energy AB | 11,187 | 395,342 | ||||||
403,057 | ||||||||
Switzerland — 3.8% | ||||||||
Kuehne + Nagel International AG | 1,008 | 288,155 | ||||||
Novartis AG | 9,944 | 792,594 | ||||||
Partners Group Holding AG | 282 | 486,689 |
12
Shares | Value | |||||||
Sonova Holding AG | 728 | $ | 273,596 | |||||
Straumann Holding AG | 381 | 809,986 | ||||||
2,651,020 | ||||||||
United Kingdom — 14.3% | ||||||||
Anglo American plc | 9,711 | 357,460 | ||||||
Aviva plc | 190,909 | 974,335 | ||||||
Barclays plc | 58,842 | 143,673 | ||||||
BHP Group plc | 37,879 | 1,035,083 | ||||||
BP plc | 129,542 | 562,047 | ||||||
Evraz plc | 83,501 | 636,555 | ||||||
GlaxoSmithKline plc | 9,659 | 196,108 | ||||||
HSBC Holdings plc | 38,574 | 213,175 | ||||||
JD Sports Fashion plc | 172,040 | 508,778 | ||||||
Kingfisher plc | 47,071 | 197,803 | ||||||
Legal & General Group plc | 91,044 | 340,131 | ||||||
Lloyds Banking Group plc | 405,220 | 251,619 | ||||||
Next plc | 6,042 | 631,237 | ||||||
Prudential plc | 8,764 | 148,035 | ||||||
Rio Tinto plc | 16,777 | 1,028,499 | ||||||
Royal Dutch Shell plc, A Shares | 32,896 | 688,164 | ||||||
Royal Dutch Shell plc, B Shares | 48,754 | 1,021,685 | ||||||
Unilever plc | 11,361 | 580,240 | ||||||
Vodafone Group plc | 377,849 | 547,812 | ||||||
10,062,439 | ||||||||
United States — 7.1% | ||||||||
Alphabet, Inc., Class C(1) | 86 | 245,017 | ||||||
Amazon.com, Inc.(1) | 82 | 287,580 | ||||||
American Express Co. | 1,255 | 191,137 | ||||||
Blackstone, Inc. | 3,679 | 520,395 | ||||||
Broadcom, Inc. | 653 | 361,553 | ||||||
Chemours Co. (The) | 7,784 | 231,185 | ||||||
Crane Co. | 6,121 | 590,921 | ||||||
Delta Air Lines, Inc.(1) | 6,288 | 227,626 | ||||||
Devon Energy Corp. | 6,095 | 256,356 | ||||||
Goldman Sachs Group, Inc. (The) | 558 | 212,592 | ||||||
Hilton Worldwide Holdings, Inc.(1) | 2,061 | 278,379 | ||||||
Horizon Therapeutics plc(1) | 2,356 | 244,459 | ||||||
JPMorgan Chase & Co. | 2,116 | 336,084 | ||||||
Microsoft Corp. | 999 | 330,259 | ||||||
Nasdaq, Inc. | 1,897 | 385,527 | ||||||
QUALCOMM, Inc. | 1,801 | 325,189 | ||||||
5,024,259 | ||||||||
TOTAL COMMON STOCKS (Cost $66,769,841) | 69,208,521 | |||||||
TEMPORARY CASH INVESTMENTS — 1.3% | ||||||||
Repurchase Agreement, BMO Capital Markets Corp., (collateralized by various U.S. Treasury obligations, 0.125% - 2.625%, 6/30/22 - 5/15/51, valued at $220,871), in a joint trading account at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $216,239) | 216,239 | |||||||
Repurchase Agreement, Fixed Income Clearing Corp., (collateralized by various U.S. Treasury obligations, 1.00%, 7/31/28, valued at $735,516), at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $721,000) | 721,000 |
13
Shares | Value | |||||||
State Street Institutional U.S. Government Money Market Fund, Premier Class | 3,352 | $ | 3,352 | |||||
TOTAL TEMPORARY CASH INVESTMENTS (Cost $940,591) | 940,591 | |||||||
TOTAL INVESTMENT SECURITIES — 99.5% (Cost $67,710,432) | 70,149,112 | |||||||
OTHER ASSETS AND LIABILITIES — 0.5% | 340,979 | |||||||
TOTAL NET ASSETS — 100.0% | $ | 70,490,091 |
MARKET SECTOR DIVERSIFICATION | |||||
(as a % of net assets) | |||||
Financials | 23.4% | ||||
Industrials | 15.5% | ||||
Consumer Discretionary | 13.1% | ||||
Materials | 10.5% | ||||
Energy | 8.5% | ||||
Information Technology | 7.1% | ||||
Health Care | 6.9% | ||||
Communication Services | 5.0% | ||||
Consumer Staples | 4.7% | ||||
Utilities | 2.4% | ||||
Real Estate | 1.1% | ||||
Temporary Cash Investments | 1.3% | ||||
Other Assets and Liabilities | 0.5% |
NOTES TO SCHEDULE OF INVESTMENTS |
(1)Non-income producing.
(2)Security, or a portion thereof, is on loan. At the period end, the aggregate value of securities on loan was $234,194. The amount of securities on loan indicated may not correspond with the securities on loan identified because securities with pending sales are in the process of recall from the brokers. At the period end, the aggregate value of the collateral held by the fund was $251,903, all of which is securities collateral.
See Notes to Financial Statements.
14
Statement of Assets and Liabilities |
NOVEMBER 30, 2021 | |||||
Assets | |||||
Investment securities, at value (cost of $67,710,432) — including $234,194 of securities on loan | $ | 70,149,112 | |||
Foreign currency holdings, at value (cost of $34,890) | 35,041 | ||||
Receivable for capital shares sold | 25,348 | ||||
Dividends and interest receivable | 406,858 | ||||
Securities lending receivable | 873 | ||||
70,617,232 | |||||
Liabilities | |||||
Payable for capital shares redeemed | 66,580 | ||||
Accrued management fees | 58,156 | ||||
Distribution and service fees payable | 2,405 | ||||
127,141 | |||||
Net Assets | $ | 70,490,091 | |||
Net Assets Consist of: | |||||
Capital (par value and paid-in surplus) | $ | 71,081,303 | |||
Distributable earnings | (591,212) | ||||
$ | 70,490,091 |
Net Assets | Shares Outstanding | Net Asset Value Per Share | |||||||||
Investor Class, $0.01 Par Value | $14,827,048 | 1,771,079 | $8.37 | ||||||||
I Class, $0.01 Par Value | $46,842,442 | 5,604,484 | $8.36 | ||||||||
A Class, $0.01 Par Value | $6,406,937 | 761,066 | $8.42* | ||||||||
C Class, $0.01 Par Value | $734,393 | 87,721 | $8.37 | ||||||||
R Class, $0.01 Par Value | $893,209 | 106,591 | $8.38 | ||||||||
R6 Class, $0.01 Par Value | $786,062 | 94,047 | $8.36 |
*Maximum offering price $8.93 (net asset value divided by 0.9425).
See Notes to Financial Statements.
15
Statement of Operations |
YEAR ENDED NOVEMBER 30, 2021 | |||||
Investment Income (Loss) | |||||
Income: | |||||
Dividends (net of foreign taxes withheld of $212,065) | $ | 2,384,193 | |||
Securities lending, net | 12,652 | ||||
Interest | 300 | ||||
2,397,145 | |||||
Expenses: | |||||
Management fees | 634,271 | ||||
Distribution and service fees: | |||||
A Class | 17,146 | ||||
C Class | 8,417 | ||||
R Class | 4,618 | ||||
Directors' fees and expenses | 1,628 | ||||
Other expenses | 150 | ||||
666,230 | |||||
Net investment income (loss) | 1,730,915 | ||||
Realized and Unrealized Gain (Loss) | |||||
Net realized gain (loss) on: | |||||
Investment transactions | 4,170,902 | ||||
Futures contract transactions | 67,981 | ||||
Foreign currency translation transactions | 2,225 | ||||
4,241,108 | |||||
Change in net unrealized appreciation (depreciation) on: | |||||
Investments | (1,791,212) | ||||
Futures contracts | (40,092) | ||||
Translation of assets and liabilities in foreign currencies | (10,884) | ||||
(1,842,188) | |||||
Net realized and unrealized gain (loss) | 2,398,920 | ||||
Net Increase (Decrease) in Net Assets Resulting from Operations | $ | 4,129,835 |
See Notes to Financial Statements.
16
Statement of Changes in Net Assets |
YEARS ENDED NOVEMBER 30, 2021 AND NOVEMBER 30, 2020 | ||||||||
Increase (Decrease) in Net Assets | November 30, 2021 | November 30, 2020 | ||||||
Operations | ||||||||
Net investment income (loss) | $ | 1,730,915 | $ | 983,587 | ||||
Net realized gain (loss) | 4,241,108 | (1,208,921) | ||||||
Change in net unrealized appreciation (depreciation) | (1,842,188) | 3,521,037 | ||||||
Net increase (decrease) in net assets resulting from operations | 4,129,835 | 3,295,703 | ||||||
Distributions to Shareholders | ||||||||
From earnings: | ||||||||
Investor Class | (310,577) | (330,222) | ||||||
I Class | (835,020) | (669,104) | ||||||
A Class | (125,340) | (164,627) | ||||||
C Class | (8,358) | (17,023) | ||||||
R Class | (14,024) | (14,529) | ||||||
R6 Class | (25,537) | (218,419) | ||||||
Decrease in net assets from distributions | (1,318,856) | (1,413,924) | ||||||
Capital Share Transactions | ||||||||
Net increase (decrease) in net assets from capital share transactions (Note 5) | 16,171,205 | 6,489,456 | ||||||
Net increase (decrease) in net assets | 18,982,184 | 8,371,235 | ||||||
Net Assets | ||||||||
Beginning of period | 51,507,907 | 43,136,672 | ||||||
End of period | $ | 70,490,091 | $ | 51,507,907 |
See Notes to Financial Statements.
17
Notes to Financial Statements |
NOVEMBER 30, 2021
1. Organization
American Century World Mutual Funds, Inc. (the corporation) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company and is organized as a Maryland corporation. International Value Fund (the fund) is one fund in a series issued by the corporation. The fund’s investment objective is to seek long-term capital growth.
The fund offers the Investor Class, I Class, A Class, C Class, R Class and R6 Class. The A Class may incur an initial sales charge. The A Class and C Class may be subject to a contingent deferred sales charge.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently followed by the fund in preparation of its financial statements. The fund is an investment company and follows accounting and reporting guidance in accordance with accounting principles generally accepted in the United States of America. This may require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from these estimates. Management evaluated the impact of events or transactions occurring through the date the financial statements were issued that would merit recognition or disclosure.
Investment Valuations — The fund determines the fair value of its investments and computes its net asset value (NAV) per share at the close of regular trading (usually 4 p.m. Eastern time) on the New York Stock Exchange (NYSE) on each day the NYSE is open. The Board of Directors has adopted valuation policies and procedures to guide the investment advisor in the fund’s investment valuation process and to provide methodologies for the oversight of the fund’s pricing function.
Equity securities that are listed or traded on a domestic securities exchange are valued at the last reported sales price or at the official closing price as provided by the exchange. Equity securities traded on foreign securities exchanges are generally valued at the closing price of such securities on the exchange where primarily traded or at the close of the NYSE, if that is earlier. If no last sales price is reported, or if local convention or regulation so provides, the mean of the latest bid and asked prices may be used. Securities traded over-the-counter are valued at the mean of the latest bid and asked prices, the last sales price, or the official closing price. Equity securities initially expressed in local currencies are translated into U.S. dollars at the mean of the appropriate currency exchange rate at the close of the NYSE as provided by an independent pricing service.
Open-end management investment companies are valued at the reported NAV per share. Repurchase agreements are valued at cost, which approximates fair value. Exchange-traded futures contracts are valued at the settlement price as provided by the appropriate exchange.
If the fund determines that the market price for an investment is not readily available or the valuation methods mentioned above do not reflect an investment’s fair value, such investment is valued as determined in good faith by the Board of Directors or its delegate, in accordance with policies and procedures adopted by the Board of Directors. In its determination of fair value, the fund may review several factors including, but not limited to, market information regarding the specific investment or comparable investments and correlation with other investment types, futures indices or general market indicators. Circumstances that may cause the fund to use these procedures to value an investment include, but are not limited to: an investment has been declared in default or is distressed; trading in a security has been suspended during the trading day or a security is not actively trading on its principal exchange; prices received from a regular pricing source are deemed unreliable; or there is a foreign market holiday and no trading occurred.
18
The fund monitors for significant events occurring after the close of an investment’s primary exchange but before the fund’s NAV per share is determined. Significant events may include, but are not limited to: corporate announcements and transactions; governmental action and political unrest that could impact a specific investment or an investment sector; or armed conflicts, natural disasters and similar events that could affect investments in a specific country or region. The fund also monitors for significant fluctuations between domestic and foreign markets, as evidenced by the U.S. market or such other indicators that the Board of Directors, or its delegate, deems appropriate. The fund may apply a model-derived factor to the closing price of equity securities traded on foreign securities exchanges. The factor is based on observable market data as provided by an independent pricing service.
Security Transactions — Security transactions are accounted for as of the trade date. Net realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes.
Investment Income — Dividend income less foreign taxes withheld, if any, is recorded as of the ex-dividend date. Distributions received on securities that represent a return of capital or long-term capital gain are recorded as a reduction of cost of investments and/or as a realized gain. The fund may estimate the components of distributions received that may be considered nontaxable distributions or long-term capital gain distributions for income tax purposes. Interest income is recorded on the accrual basis and includes accretion of discounts and amortization of premiums. Securities lending income is net of fees and rebates earned by the lending agent for its services.
Foreign Currency Translations — All assets and liabilities initially expressed in foreign currencies are translated into U.S. dollars at prevailing exchange rates at period end. The fund may enter into spot foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of investment securities, dividend and interest income, spot foreign currency exchange contracts, and expenses are translated at the rates of exchange prevailing on the respective dates of such transactions. Net realized and unrealized foreign currency exchange gains or losses related to investment securities are a component of net realized gain (loss) on investment transactions and change in net unrealized appreciation (depreciation) on investments, respectively.
Repurchase Agreements — The fund may enter into repurchase agreements with institutions that American Century Investment Management, Inc. (ACIM) (the investment advisor) has determined are creditworthy pursuant to criteria adopted by the Board of Directors. The fund requires that the collateral, represented by securities, received in a repurchase transaction be transferred to the custodian in a manner sufficient to enable the fund to obtain those securities in the event of a default under the repurchase agreement. ACIM monitors, on a daily basis, the securities transferred to ensure the value, including accrued interest, of the securities under each repurchase agreement is equal to or greater than amounts owed to the fund under each repurchase agreement.
Joint Trading Account — Pursuant to an Exemptive Order issued by the Securities and Exchange Commission, the fund, along with certain other funds in the American Century Investments family of funds, may transfer uninvested cash balances into a joint trading account. These balances are invested in one or more repurchase agreements that are collateralized by U.S. Treasury or Agency obligations.
Segregated Assets — In accordance with the 1940 Act, the fund segregates assets on its books and records to cover certain types of investment securities and other financial instruments. ACIM monitors, on a daily basis, the securities segregated to ensure the fund designates a sufficient amount of liquid assets, marked-to-market daily. The fund may also receive assets or be required to pledge assets at the custodian bank or with a broker for collateral requirements.
Income Tax Status — It is the fund’s policy to distribute substantially all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code. Accordingly, no provision has been made for income taxes. The fund files U.S. federal, state, local and non-U.S. tax returns as applicable. The fund's tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years from the date of filing but can be longer in certain jurisdictions. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
19
Multiple Class — All shares of the fund represent an equal pro rata interest in the net assets of the class to which such shares belong, and have identical voting, dividend, liquidation and other rights and the same terms and conditions, except for class specific expenses and exclusive rights to vote on matters affecting only individual classes. Income, non-class specific expenses, and realized and unrealized capital gains and losses of the fund are allocated to each class of shares based on their relative net assets.
Distributions to Shareholders — Distributions from net investment income and net realized gains, if any, are generally declared and paid annually. The fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code, in all events in a manner consistent with provisions of the 1940 Act.
Indemnifications — Under the corporation’s organizational documents, its officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business, the fund enters into contracts that provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against a fund. The risk of material loss from such claims is considered by management to be remote.
Securities Lending — Securities are lent to qualified financial institutions and brokers. State Street Bank & Trust Co. serves as securities lending agent to the fund pursuant to a Securities Lending Agreement. The lending of securities exposes the fund to risks such as: the borrowers may fail to return the loaned securities, the borrowers may not be able to provide additional collateral, the fund may experience delays in recovery of the loaned securities or delays in access to collateral, or the fund may experience losses related to the investment collateral. To minimize certain risks, loan counterparties pledge collateral in the form of cash and/or securities. The lending agent has agreed to indemnify the fund in the case of default of any securities borrowed. Cash collateral received is invested in the State Street Navigator Securities Lending Government Money Market Portfolio, a money market mutual fund registered under the 1940 Act. The loans may also be secured by U.S. government securities in an amount at least equal to the market value of the securities loaned, plus accrued interest and dividends, determined on a daily basis and adjusted accordingly. By lending securities, the fund seeks to increase its net investment income through the receipt of interest and fees. Such income is reflected separately within the Statement of Operations. The value of loaned securities and related collateral outstanding at period end, if any, are shown on a gross basis within the Schedule of Investments and Statement of Assets and Liabilities.
3. Fees and Transactions with Related Parties
Certain officers and directors of the corporation are also officers and/or directors of American Century Companies, Inc. (ACC). The corporation’s investment advisor, ACIM, the corporation's distributor, American Century Investment Services, Inc. (ACIS), and the corporation’s transfer agent, American Century Services, LLC, are wholly owned, directly or indirectly, by ACC.
Management Fees — The corporation has entered into a management agreement with ACIM, under which ACIM provides the fund with investment advisory and management services in exchange for a single, unified management fee (the fee) per class. The agreement provides that ACIM will pay all expenses of managing and operating the fund, except brokerage expenses, taxes, interest, fees and expenses of the independent directors (including legal counsel fees), extraordinary expenses, and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the 1940 Act. The fee is computed and accrued daily based on each class's daily net assets and paid monthly in arrears. The difference in the fee among the classes is a result of their separate arrangements for non-Rule 12b-1 shareholder services. It is not the result of any difference in advisory or custodial fees or other expenses related to the management of the fund’s assets, which do not vary by class.
The annual management fee for each class is as follows:
Investor Class | I Class | A Class | C Class | R Class | R6 Class | ||||||||||||
1.10% | 0.90% | 1.10% | 1.10% | 1.10% | 0.75% |
20
Distribution and Service Fees — The Board of Directors has adopted a separate Master Distribution and Individual Shareholder Services Plan for each of the A Class, C Class and R Class (collectively the plans), pursuant to Rule 12b-1 of the 1940 Act. The plans provide that the A Class will pay ACIS an annual distribution and service fee of 0.25%. The plans provide that the C Class will pay ACIS an annual distribution and service fee of 1.00%, of which 0.25% is paid for individual shareholder services and 0.75% is paid for distribution services. The plans provide that the R Class will pay ACIS an annual distribution and service fee of 0.50%. The fees are computed and accrued daily based on each class’s daily net assets and paid monthly in arrears. The fees are used to pay financial intermediaries for distribution and individual shareholder services. Fees incurred under the plans during the period ended November 30, 2021 are detailed in the Statement of Operations.
Directors' Fees and Expenses — The Board of Directors is responsible for overseeing the investment advisor’s management and operations of the fund. The directors receive detailed information about the fund and its investment advisor regularly throughout the year, and meet at least quarterly with management of the investment advisor to review reports about fund operations. The fund’s officers do not receive compensation from the fund.
Interfund Transactions — The fund may enter into security transactions with other American Century Investments funds and other client accounts of the investment advisor, in accordance with the 1940 Act rules and procedures adopted by the Board of Directors. The rules and procedures require, among other things, that these transactions be effected at the independent current market price of the security. During the period, the interfund purchases were $215,554 and there were no interfund sales.
4. Investment Transactions
Purchases and sales of investment securities, excluding short-term investments, for the period ended November 30, 2021 were $94,801,076 and $78,129,891, respectively.
21
5. Capital Share Transactions
Transactions in shares of the fund were as follows:
Year ended November 30, 2021 | Year ended November 30, 2020 | |||||||||||||
Shares | Amount | Shares | Amount | |||||||||||
Investor Class/Shares Authorized | 40,000,000 | 40,000,000 | ||||||||||||
Sold | 557,197 | $ | 4,873,094 | 1,009,982 | $ | 7,521,588 | ||||||||
Issued in reinvestment of distributions | 35,319 | 300,929 | 46,745 | 321,514 | ||||||||||
Redeemed | (436,726) | (3,831,229) | (648,246) | (4,522,731) | ||||||||||
155,790 | 1,342,794 | 408,481 | 3,320,371 | |||||||||||
I Class/Shares Authorized | 40,000,000 | 40,000,000 | ||||||||||||
Sold | 2,185,152 | 19,237,408 | 1,655,973 | 11,355,643 | ||||||||||
Issued in reinvestment of distributions | 98,238 | 835,020 | 96,273 | 669,104 | ||||||||||
Redeemed | (507,317) | (4,453,793) | (430,511) | (3,029,441) | ||||||||||
1,776,073 | 15,618,635 | 1,321,735 | 8,995,306 | |||||||||||
A Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 70,665 | 618,269 | 43,931 | 312,511 | ||||||||||
Issued in reinvestment of distributions | 14,498 | 124,535 | 23,249 | 164,079 | ||||||||||
Redeemed | (109,426) | (962,671) | (141,618) | (1,033,880) | ||||||||||
(24,263) | (219,867) | (74,438) | (557,290) | |||||||||||
C Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 11,368 | 97,302 | 7,452 | 55,084 | ||||||||||
Issued in reinvestment of distributions | 974 | 8,358 | 2,374 | 16,902 | ||||||||||
Redeemed | (43,057) | (372,648) | (77,824) | (542,937) | ||||||||||
(30,715) | (266,988) | (67,998) | (470,951) | |||||||||||
R Class/Shares Authorized | 30,000,000 | 30,000,000 | ||||||||||||
Sold | 26,160 | 231,046 | 49,675 | 350,364 | ||||||||||
Issued in reinvestment of distributions | 1,328 | 11,483 | 2,089 | 14,495 | ||||||||||
Redeemed | (29,232) | (254,388) | (19,547) | (127,277) | ||||||||||
(1,744) | (11,859) | 32,217 | 237,582 | |||||||||||
R6 Class/Shares Authorized | 45,000,000 | 45,000,000 | ||||||||||||
Sold | 164,202 | 1,458,253 | 363,258 | 2,504,184 | ||||||||||
Issued in reinvestment of distributions | 3,008 | 25,537 | 31,120 | 218,419 | ||||||||||
Redeemed | (204,652) | (1,775,300) | (1,122,203) | (7,758,165) | ||||||||||
(37,442) | (291,510) | (727,825) | (5,035,562) | |||||||||||
Net increase (decrease) | 1,837,699 | $ | 16,171,205 | 892,172 | $ | 6,489,456 |
22
6. Fair Value Measurements
The fund’s investments valuation process is based on several considerations and may use multiple inputs to determine the fair value of the investments held by the fund. In conformity with accounting principles generally accepted in the United States of America, the inputs used to determine a valuation are classified into three broad levels.
•Level 1 valuation inputs consist of unadjusted quoted prices in an active market for identical investments.
•Level 2 valuation inputs consist of direct or indirect observable market data (including quoted prices for comparable investments, evaluations of subsequent market events, interest rates, prepayment speeds, credit risk, etc.). These inputs also consist of quoted prices for identical investments initially expressed in local currencies that are adjusted through translation into U.S. dollars.
•Level 3 valuation inputs consist of unobservable data (including a fund’s own assumptions).
The level classification is based on the lowest level input that is significant to the fair valuation measurement. The valuation inputs are not necessarily an indication of the risks associated with investing in these securities or other financial instruments.
The following is a summary of the level classifications as of period end. The Schedule of Investments provides additional information on the fund’s portfolio holdings.
Level 1 | Level 2 | Level 3 | |||||||||
Assets | |||||||||||
Investment Securities | |||||||||||
Common Stocks | |||||||||||
United States | $ | 5,024,259 | — | — | |||||||
Other Countries | — | $ | 64,184,262 | — | |||||||
Temporary Cash Investments | 3,352 | 937,239 | — | ||||||||
$ | 5,027,611 | $ | 65,121,501 | — |
7. Derivative Instruments
Equity Price Risk — The fund is subject to equity price risk in the normal course of pursuing its investment objectives. A fund may enter into futures contracts based on an equity index in order to manage its exposure to changes in market conditions. A fund may purchase futures contracts to gain exposure to increases in market value or sell futures contracts to protect against a decline in market value. Upon entering into a futures contract, a fund is required to deposit either cash or securities in an amount equal to a certain percentage of the contract value (initial margin). Subsequent payments (variation margin) are made or received daily, in cash, by a fund. The variation margin is equal to the daily change in the contract value and is recorded as unrealized gains and losses. A fund recognizes a realized gain or loss when the contract is closed or expires. Net realized and unrealized gains or losses occurring during the holding period of futures contracts are a component of net realized gain (loss) on futures contract transactions and change in net unrealized appreciation (depreciation) on futures contracts, respectively. One of the risks of entering into futures contracts is the possibility that the change in value of the contract may not correlate with the changes in value of the underlying securities. The fund's average notional exposure to equity price risk derivative instruments held during the period was $1,069,755 futures contracts purchased.
At period end, the fund did not have any derivative instruments disclosed on the Statement of Assets and Liabilities. For the year ended November 30, 2021, the effect of equity price risk derivative instruments on the Statement of Operations was $67,981 in net realized gain (loss) on futures contract transactions and $(40,092) in change in net unrealized appreciation (depreciation) on futures contracts.
23
8. Risk Factors
The value of the fund’s shares will go up and down, sometimes rapidly or unpredictably, based on the performance of the securities owned by the fund and other factors generally affecting the securities market. Market risks, including political, regulatory, economic and social developments, can affect the value of the fund’s investments. Natural disasters, public health emergencies, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse long-term effects on world economies and markets generally.
There are certain risks involved in investing in foreign securities. These risks include those resulting from political events (such as civil unrest, national elections and imposition of exchange controls), social and economic events (such as labor strikes and rising inflation), and natural disasters. Securities of foreign issuers may be less liquid and more volatile. Investing in emerging markets or a significant portion of assets in one country or region may accentuate these risks.
The fund invests in common stocks of small companies. Because of this, the fund may be subject to greater risk and market fluctuations than a fund investing in larger, more established companies.
The fund’s investment process may result in high portfolio turnover, which could mean high transaction costs, affecting both performance and capital gains tax liabilities to investors.
9. Federal Tax Information
On December 21, 2021, the fund declared and paid the following per-share distributions from net investment income to shareholders of record on December 20, 2021:
Investor Class | I Class | A Class | C Class | R Class | R6 Class | ||||||||||||
$0.2836 | $0.2968 | $0.2672 | $0.2178 | $0.2507 | $0.3066 |
The tax character of distributions paid during the years ended November 30, 2021 and November 30, 2020 were as follows:
2021 | 2020 | |||||||
Distributions Paid From | ||||||||
Ordinary income | $ | 1,318,856 | $ | 1,413,924 | ||||
Long-term capital gains | — | — |
The book-basis character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements.
As of period end, the federal tax cost of investments and the components of distributable earnings on a tax-basis were as follows:
Federal tax cost of investments | $ | 68,217,298 | |||
Gross tax appreciation of investments | $ | 5,509,982 | |||
Gross tax depreciation of investments | (3,578,168) | ||||
Net tax appreciation (depreciation) of investments | 1,931,814 | ||||
Net tax appreciation (depreciation) on derivatives and translation of assets and liabilities in foreign currencies | (1,173) | ||||
Net tax appreciation (depreciation) | $ | 1,930,641 | |||
Undistributed ordinary income | $ | 2,447,528 | |||
Accumulated short-term capital losses | $ | (3,138,635) | |||
Accumulated long-term capital losses | $ | (1,830,746) |
The difference between book-basis and tax-basis unrealized appreciation (depreciation) is attributable primarily to the tax deferral of losses on wash sales.
24
Accumulated capital losses represent net capital loss carryovers that may be used to offset future realized capital gains for federal income tax purposes. The capital loss carryovers may be carried forward for an unlimited period. Future capital loss carryover utilization in any given year may be subject to Internal Revenue Code limitations.
25
Financial Highlights |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Ratio to Average Net Assets of: | ||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Distributions From Net Investment Income | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Operating Expenses (before expense waiver) | Net Investment Income (Loss) | Net Investment Income (Loss) (before expense waiver) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||
Investor Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $7.82 | 0.23 | 0.50 | 0.73 | (0.18) | $8.37 | 9.30% | 1.10% | 1.10% | 2.57% | 2.57% | 124% | $14,827 | ||||||||||||||||||||||||||||
2020 | $7.57 | 0.15 | 0.33 | 0.48 | (0.23) | $7.82 | 6.69% | 1.21% | 1.22% | 2.16% | 2.15% | 91% | $12,633 | ||||||||||||||||||||||||||||
2019 | $7.61 | 0.23 | 0.02 | 0.25 | (0.29) | $7.57 | 3.41% | 1.34% | 1.34% | 3.13% | 3.13% | 87% | $9,136 | ||||||||||||||||||||||||||||
2018 | $8.96 | 0.21 | (1.27) | (1.06) | (0.29) | $7.61 | (12.25)% | 1.30% | 1.30% | 2.56% | 2.56% | 80% | $11,008 | ||||||||||||||||||||||||||||
2017 | $7.40 | 0.21 | 1.51 | 1.72 | (0.16) | $8.96 | 23.59% | 1.30% | 1.30% | 2.47% | 2.47% | 101% | $14,398 | ||||||||||||||||||||||||||||
I Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $7.81 | 0.24 | 0.51 | 0.75 | (0.20) | $8.36 | 9.54% | 0.90% | 0.90% | 2.77% | 2.77% | 124% | $46,842 | ||||||||||||||||||||||||||||
2020 | $7.57 | 0.16 | 0.33 | 0.49 | (0.25) | $7.81 | 6.93% | 1.01% | 1.02% | 2.36% | 2.35% | 91% | $29,898 | ||||||||||||||||||||||||||||
2019 | $7.62 | 0.25 | 0.01 | 0.26 | (0.31) | $7.57 | 3.53% | 1.14% | 1.14% | 3.33% | 3.33% | 87% | $18,981 | ||||||||||||||||||||||||||||
2018 | $8.97 | 0.22 | (1.26) | (1.04) | (0.31) | $7.62 | (12.05)% | 1.10% | 1.10% | 2.76% | 2.76% | 80% | $7,434 | ||||||||||||||||||||||||||||
2017 | $7.41 | 0.23 | 1.51 | 1.74 | (0.18) | $8.97 | 23.86% | 1.10% | 1.10% | 2.67% | 2.67% | 101% | $4,173 | ||||||||||||||||||||||||||||
A Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $7.86 | 0.20 | 0.52 | 0.72 | (0.16) | $8.42 | 9.10% | 1.35% | 1.35% | 2.32% | 2.32% | 124% | $6,407 | ||||||||||||||||||||||||||||
2020 | $7.60 | 0.13 | 0.33 | 0.46 | (0.20) | $7.86 | 6.32% | 1.46% | 1.47% | 1.91% | 1.90% | 91% | $6,176 | ||||||||||||||||||||||||||||
2019 | $7.64 | 0.22 | 0.01 | 0.23 | (0.27) | $7.60 | 3.08% | 1.59% | 1.59% | 2.88% | 2.88% | 87% | $6,532 | ||||||||||||||||||||||||||||
2018 | $8.99 | 0.19 | (1.27) | (1.08) | (0.27) | $7.64 | (12.43)% | 1.55% | 1.55% | 2.31% | 2.31% | 80% | $7,651 | ||||||||||||||||||||||||||||
2017 | $7.41 | 0.17 | 1.55 | 1.72 | (0.14) | $8.99 | 23.45% | 1.55% | 1.55% | 2.22% | 2.22% | 101% | $9,857 |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Ratio to Average Net Assets of: | ||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Distributions From Net Investment Income | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Operating Expenses (before expense waiver) | Net Investment Income (Loss) | Net Investment Income (Loss) (before expense waiver) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||
C Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $7.82 | 0.12 | 0.52 | 0.64 | (0.09) | $8.37 | 8.19% | 2.10% | 2.10% | 1.57% | 1.57% | 124% | $734 | ||||||||||||||||||||||||||||
2020 | $7.51 | 0.07 | 0.34 | 0.41 | (0.10) | $7.82 | 5.65% | 2.21% | 2.22% | 1.16% | 1.15% | 91% | $926 | ||||||||||||||||||||||||||||
2019 | $7.54 | 0.16 | 0.01 | 0.17 | (0.20) | $7.51 | 2.29% | 2.34% | 2.34% | 2.13% | 2.13% | 87% | $1,400 | ||||||||||||||||||||||||||||
2018 | $8.87 | 0.13 | (1.26) | (1.13) | (0.20) | $7.54 | (13.04)% | 2.30% | 2.30% | 1.56% | 1.56% | 80% | $2,224 | ||||||||||||||||||||||||||||
2017 | $7.33 | 0.12 | 1.51 | 1.63 | (0.09) | $8.87 | 22.41% | 2.30% | 2.30% | 1.47% | 1.47% | 101% | $4,225 | ||||||||||||||||||||||||||||
R Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $7.83 | 0.18 | 0.51 | 0.69 | (0.14) | $8.38 | 8.73% | 1.60% | 1.60% | 2.07% | 2.07% | 124% | $893 | ||||||||||||||||||||||||||||
2020 | $7.55 | 0.12 | 0.33 | 0.45 | (0.17) | $7.83 | 6.16% | 1.71% | 1.72% | 1.66% | 1.65% | 91% | $848 | ||||||||||||||||||||||||||||
2019 | $7.58 | 0.19 | 0.02 | 0.21 | (0.24) | $7.55 | 2.91% | 1.84% | 1.84% | 2.63% | 2.63% | 87% | $575 | ||||||||||||||||||||||||||||
2018 | $8.93 | 0.18 | (1.29) | (1.11) | (0.24) | $7.58 | (12.74)% | 1.80% | 1.80% | 2.06% | 2.06% | 80% | $672 | ||||||||||||||||||||||||||||
2017 | $7.36 | 0.16 | 1.52 | 1.68 | (0.11) | $8.93 | 23.09% | 1.80% | 1.80% | 1.97% | 1.97% | 101% | $537 | ||||||||||||||||||||||||||||
R6 Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $7.81 | 0.27 | 0.49 | 0.76 | (0.21) | $8.36 | 9.71% | 0.75% | 0.75% | 2.92% | 2.92% | 124% | $786 | ||||||||||||||||||||||||||||
2020 | $7.58 | 0.18 | 0.32 | 0.50 | (0.27) | $7.81 | 7.08% | 0.86% | 0.87% | 2.51% | 2.50% | 91% | $1,027 | ||||||||||||||||||||||||||||
2019 | $7.63 | 0.26 | 0.01 | 0.27 | (0.32) | $7.58 | 3.72% | 0.99% | 0.99% | 3.48% | 3.48% | 87% | $6,513 | ||||||||||||||||||||||||||||
2018 | $8.98 | 0.26 | (1.29) | (1.03) | (0.32) | $7.63 | (11.91)% | 0.95% | 0.95% | 2.91% | 2.91% | 80% | $16,485 | ||||||||||||||||||||||||||||
2017 | $7.42 | 0.23 | 1.52 | 1.75 | (0.19) | $8.98 | 24.06% | 0.95% | 0.95% | 2.82% | 2.82% | 101% | $46,833 |
Notes to Financial Highlights |
(1)Computed using average shares outstanding throughout the period.
(2)Total returns are calculated based on the net asset value of the last business day and do not reflect applicable sales charges, if any. Total returns for periods less than one year are not annualized.
See Notes to Financial Statements.
Report of Independent Registered Public Accounting Firm |
To the Shareholders and the Board of Directors of American Century World Mutual Funds, Inc.:
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of International Value Fund (the “Fund”), one of the funds constituting the American Century World Mutual Funds, Inc., as of November 30, 2021, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of International Value Fund of the American Century World Mutual Funds, Inc. as of November 30, 2021, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund’s financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. 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, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of November 30, 2021, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
/s/ Deloitte & Touche LLP
Kansas City, Missouri
January 19, 2022
We have served as the auditor of one or more American Century investment companies since 1997.
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Management |
The Board of Directors
The individuals listed below serve as directors of the funds. Each director will continue to serve in this capacity until death, retirement, resignation or removal from office. The board has adopted a mandatory retirement age for directors who are not “interested persons,” as that term is defined in the Investment Company Act (independent directors). Independent directors shall retire by December 31 of the year in which they reach their 75th birthday.
Jonathan S. Thomas is an “interested person” because he currently serves as President and Chief Executive Officer of American Century Companies, Inc. (ACC), the parent company of American Century Investment Management, Inc. (ACIM or the advisor). The other directors (more than three-fourths of the total number) are independent. They are not employees, directors or officers of, and have no financial interest in, ACC or any of its wholly owned, direct or indirect, subsidiaries, including ACIM, American Century Investment Services, Inc. (ACIS) and American Century Services, LLC (ACS), and they do not have any other affiliations, positions or relationships that would cause them to be considered “interested persons” under the Investment Company Act. The directors serve in this capacity for seven (in the case of Jonathan S. Thomas, 16; and Stephen E. Yates, 8) registered investment companies in the American Century Investments family of funds.
The following table presents additional information about the directors. The mailing address for each director is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Thomas W. Bunn (1953) | Director | Since 2017 | Retired | 72 | SquareTwo Financial; Barings (formerly Babson Capital Funds Trust) (2013 to 2016) | ||||||||||||
Chris H. Cheesman (1962) | Director | Since 2019 | Retired. Senior Vice President & Chief Audit Executive, AllianceBernstein (1999 to 2018) | 72 | Alleghany Corporation | ||||||||||||
Barry Fink (1955) | Director | Since 2012 (independent since 2016) | Retired | 72 | None | ||||||||||||
Rajesh K. Gupta (1960) | Director | Since 2019 | Partner Emeritus, SeaCrest Investment Management and SeaCrest Wealth Management (2019 to Present); Chief Executive Officer and Chief Investment Officer, SeaCrest Investment Management (2006 to 2019); Chief Executive Officer and Chief Investment Officer, SeaCrest Wealth Management (2008 to 2019) | 72 | None |
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Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Lynn Jenkins (1963) | Director | Since 2019 | Consultant, LJ Strategies (2019 to present); United States Representative, U.S. House of Representatives (2009 to 2018) | 72 | MGP Ingredients, Inc. (2019 to 2021) | ||||||||||||
Jan M. Lewis (1957) | Director | Since 2011 | Retired | 72 | None | ||||||||||||
John R. Whitten(1) (1946) | Director | Since 2008 | Retired | 72 | Onto Innovation Inc. (2019 to 2020); Rudolph Technologies, Inc. (2006 to 2019) | ||||||||||||
Stephen E. Yates (1948) | Director and Chairman of the Board | Since 2012 (Chairman since 2018) | Retired | 108 | None | ||||||||||||
Interested Director | |||||||||||||||||
Jonathan S. Thomas (1963) | Director | Since 2007 | President and Chief Executive Officer, ACC (2007 to present). Also serves as Chief Executive Officer, ACS; Director, ACC and other ACC subsidiaries | 146 | None |
(1) Effective December 31, 2021, John R. Whitten retired from the Board of Directors.
The Statement of Additional Information has additional information about the fund's directors and is available without charge, upon request, by calling 1-800-345-2021.
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Officers
The following table presents certain information about the executive officers of the funds. Each officer serves as an officer for each of the 16 (in the case of Robert J. Leach, 15) investment companies in the American Century family of funds. No officer is compensated for his or her service as an officer of the funds. The listed officers are interested persons of the funds and are appointed or re-appointed on an annual basis. The mailing address for each officer listed below is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Offices with the Funds | Principal Occupation(s) During the Past Five Years | ||||||
Patrick Bannigan (1965) | President since 2019 | Executive Vice President and Director, ACC (2012 to present); Chief Financial Officer, Chief Accounting Officer and Treasurer, ACC (2015 to present). Also serves as President, ACS; Vice President, ACIM; Chief Financial Officer, Chief Accounting Officer and/or Director, ACIM, ACS and other ACC subsidiaries | ||||||
R. Wes Campbell (1974) | Chief Financial Officer and Treasurer since 2018 | Vice President, ACS, (2020 to present); Investment Operations and Investment Accounting, ACS (2000 to present) | ||||||
Amy D. Shelton (1964) | Chief Compliance Officer and Vice President since 2014 | Chief Compliance Officer, American Century funds, (2014 to present); Chief Compliance Officer, ACIM (2014 to present); Chief Compliance Officer, ACIS (2009 to present). Also serves as Vice President, ACIS | ||||||
John Pak (1968) | General Counsel and Senior Vice President since 2021 | General Counsel and Senior Vice President, ACC (2021 to present). Also serves as General Counsel and Senior Vice President, ACIM, ACS and ACIS. Chief Legal Officer of Investment and Wealth Management, The Bank of New York Mellon (2014 to 2021) | ||||||
C. Jean Wade (1964) | Vice President since 2012 | Senior Vice President, ACS (2017 to present); Vice President, ACS (2000 to 2017) | ||||||
Robert J. Leach (1966) | Vice President since 2006 | Vice President, ACS (2000 to present) | ||||||
David H. Reinmiller (1963) | Vice President since 2000 | Attorney, ACC (1994 to present). Also serves as Vice President, ACIM and ACS | ||||||
Ward D. Stauffer (1960) | Secretary since 2005 | Attorney, ACC (2003 to present) |
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Approval of Management Agreement |
At a meeting held on June 30, 2021, the Fund’s Board of Directors (the "Board") unanimously approved the renewal of the management agreement pursuant to which American Century Investment Management, Inc. (the “Advisor”) acts as the investment advisor for the Fund. Under Section 15(c) of the Investment Company Act, contracts for investment advisory services are required to be reviewed, evaluated, and approved by a majority of a fund’s directors (the “Directors”), including a majority of the independent Directors, each year.
Prior to its consideration of the renewal of the management agreement, the Directors requested and reviewed extensive data and information compiled by the Advisor and certain independent providers of evaluation data concerning the Fund and the services provided to the Fund by the Advisor. This review was in addition to the oversight and evaluation undertaken by the Board and its committees on a continual basis and the information received was supplemental to the extensive information that the Board and its committees receive and consider throughout the year.
In connection with its consideration of the renewal of the management agreement, the Board’s review and evaluation of the services provided by the Advisor and its affiliates included, but was not limited to, the following:
•the nature, extent, and quality of investment management, shareholder services, and other services provided and to be provided to the Fund including without limitation portfolio management and trading services, shareholder and intermediary services, compliance and legal services, fund accounting and financial reporting, and fund share distribution;
•the wide range of other programs and services provided and to be provided to the Fund and its shareholders on a routine and non-routine basis;
•the Fund’s investment performance, including data comparing the Fund's performance to appropriate benchmarks and/or a peer group of other mutual funds with similar investment objectives and strategies;
•the cost of owning the Fund compared to the cost of owning similar funds;
•the compliance policies, procedures, and regulatory experience of the Advisor and the Fund's service providers;
•the Advisor’s strategic plans, COVID-19 pandemic response, vendor management practices, and social justice initiatives;
•the Advisor’s business continuity plans and cyber security practices;
•financial data showing the cost of services provided to the Fund, the profitability of the Fund to the Advisor, and the overall profitability of the Advisor;
•possible economies of scale associated with the Advisor’s management of the Fund and other accounts;
•services provided and charges to the Advisor's other investment management clients;
•acquired fund fees and expenses;
•payments and practices in connection with financial intermediaries holding shares of the Fund and the services provided by intermediaries in connection therewith; and
•possible collateral benefits to the Advisor from the management of the Fund.
The Board held two meetings to consider the renewal. The independent Directors also met in private session three times to review and discuss the information provided in response to their request. The independent Directors held active discussions with the Advisor regarding the renewal of the management agreement, requesting supplemental information, and reviewing information provided by the Advisor in response thereto. The independent Directors had the benefit of the advice of their independent counsel throughout the process.
33
Factors Considered
The Directors considered all of the information provided by the Advisor, the independent data providers, and independent counsel in connection with the approval. They determined that the information was sufficient for them to evaluate the management agreement for the Fund. In connection with their review, the Directors did not identify any single factor as being all-important or controlling, and each Director may have attributed different levels of importance to different factors. In deciding to renew the management agreement, the Board based its decision on a number of factors, including without limitation the following:
Nature, Extent and Quality of Services — Generally. Under the management agreement, the Advisor is responsible for providing or arranging for all services necessary for the operation of the Fund. The Board noted that the Advisor provides or arranges at its own expense a wide variety of services which include the following:
•constructing and designing the Fund
•portfolio research and security selection
•initial capitalization/funding
•securities trading
•Fund administration
•custody of Fund assets
•daily valuation of the Fund’s portfolio
•liquidity monitoring and management
•risk management, including cyber security
•shareholder servicing and transfer agency, including shareholder confirmations, recordkeeping, and communications
•legal services (except the independent Directors’ counsel)
•regulatory and portfolio compliance
•financial reporting
•marketing and distribution (except amounts paid by the Fund under Rule 12b-1 plans)
The Board noted that many of these services have expanded over time in terms of both quantity and complexity in response to shareholder demands, competition in the industry, changing distribution channels, and the changing regulatory environment.
Investment Management Services. The nature of the investment management services provided to the Fund is quite complex and allows Fund shareholders access to professional money management, instant diversification of their investments within an asset class, the opportunity to easily diversify among asset classes by investing in or exchanging among various American Century Investments funds, and liquidity. In evaluating investment performance, the Board expects the Advisor to manage the Fund in accordance with its investment objectives and approved strategies. Further, the Directors recognize that the Advisor has an obligation to monitor trading activities, and in particular to seek the best execution of fund trades, and to evaluate the use of and payment for research. In providing these services, the Advisor utilizes teams of investment professionals (portfolio managers, analysts, research assistants, and securities traders) who require extensive information technology, research, training, compliance, and other systems to conduct their business. The Board, directly and through its Fund Performance Review Committee, provides oversight of the investment performance process. It regularly reviews investment performance information for the Fund, together with comparative information for appropriate benchmarks and/or peer groups of similarly-managed funds, over different time horizons. The Directors also review investment performance information during the management agreement renewal process. If performance concerns are identified, the Fund receives special reviews until performance improves, during which the Board discusses with the Advisor the reasons for such results (e.g., market conditions, security selection) and any efforts being undertaken to improve performance. The Fund’s performance was above its benchmark for the one-, three-, five-, and ten-year periods reviewed by the Board. The Board discussed the Fund's performance with the Advisor, including steps being taken to address underperformance, and was satisfied with the efforts being undertaken by the Advisor. The Board found the investment management services
34
provided by the Advisor to the Fund to be satisfactory and consistent with the management agreement.
Shareholder and Other Services. Under the management agreement, the Advisor provides the Fund with a comprehensive package of transfer agency, shareholder, and other services. The Board, directly and through its various committees, regularly reviews reports and evaluations of such services at its regular meetings. These reports include, but are not limited to, information regarding the operational efficiency and accuracy of the shareholder and transfer agency services provided, staffing levels, shareholder satisfaction, technology support (including cyber security), new products and services offered to Fund shareholders, securities trading activities, portfolio valuation services, auditing services, and legal and operational compliance activities. The Board found the services provided by the Advisor to the Fund under the management agreement to be competitive and of high quality.
Costs of Services and Profitability. The Advisor provides detailed information concerning its cost of providing various services to the Fund, its profitability in managing the Fund (pre- and post-distribution), its overall profitability, and its financial condition. The Directors have reviewed with the Advisor the methodology used to prepare this financial information. This information is considered in evaluating the Advisor’s financial condition, its ability to continue to provide services under the management agreement, and the reasonableness of the current management fee. The Board concluded that the Advisor’s profits were reasonable in light of the services provided to the Fund.
Ethics. The Board generally considers the Advisor’s commitment to providing quality services to shareholders and to conducting its business ethically. They noted that the Advisor’s practices generally meet or exceed industry best practices.
Economies of Scale. The Board also reviewed information provided by the Advisor regarding the possible existence of economies of scale in connection with the management of the Fund. The Board concluded that economies of scale are difficult to measure and predict with precision, especially on a fund-by-fund basis. The Board concluded that the Advisor is sharing economies of scale, to the extent they exist, through its competitive fee structure, offering competitive fees from fund inception, and through reinvestment in its business, infrastructure, investment capabilities and initiatives to provide shareholders additional content and services.
Comparison to Other Funds’ Fees. The management agreement provides that the Fund pays the Advisor a single, all-inclusive (or unified) management fee for providing all services necessary for the management and operation of the Fund, other than brokerage expenses, expenses attributable to short sales, taxes, interest, extraordinary expenses, fees and expenses of the Fund’s independent Directors (including their independent legal counsel), and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the Investment Company Act. Under the unified fee structure, the Advisor is responsible for providing all investment advisory, custody, audit, administrative, compliance, recordkeeping, marketing and shareholder services, or arranging and supervising third parties to provide such services. By contrast, most other funds are charged a variety of fees, including an investment advisory fee, a transfer agency fee, an administrative fee, distribution charges, and other expenses. Other than their investment advisory fees and any applicable Rule 12b-1 distribution fees, all other components of the total fees charged by these other funds may be increased without shareholder approval. The Board believes the unified fee structure is a benefit to Fund shareholders because it clearly discloses to shareholders the cost of owning Fund shares, and, since the unified fee cannot be increased without a vote of Fund shareholders, it shifts to the Advisor the risk of increased costs of operating the Fund and provides a direct incentive to minimize administrative inefficiencies. Part of the Board’s analysis of fee levels involves reviewing certain evaluative data compiled by an independent provider comparing the Fund’s unified fee to the total expense ratios of its peers. The unified fee charged to shareholders of the Fund was above the median of the total expense ratios of the Fund’s peer expense universe. In addition, the Board reviewed the Fund’s position relative to the narrower set of its expense group peers. The Board concluded that the management fee paid by the Fund to the Advisor under the management agreement is reasonable in light of the services provided to the Fund.
35
Comparison to Fees and Services Provided to Other Clients of the Advisor. The Board also requested and received information from the Advisor concerning the nature of the services, fees, costs, and profitability of its advisory services to advisory clients other than the Fund. They observed that these varying types of client accounts require different services and involve different regulatory and entrepreneurial risks than the management of the Fund. The Board analyzed this information and concluded that the fees charged and services provided to the Fund were reasonable by comparison.
Payments to Intermediaries. The Directors also requested and received a description of payments made to intermediaries by the Fund and the Advisor and services provided in response thereto. These payments include various payments made by the Fund or the Advisor to different types of intermediaries and recordkeepers for distribution and service activities provided for the Fund. The Directors reviewed such information and received representations from the Advisor that all such payments by the Fund were made pursuant to the Fund's Rule 12b-1 Plan and that all such payments by the Advisor were made from the Advisor’s resources and reasonable profits. The Board found such payments to be reasonable in scope and purpose.
Collateral or “Fall-Out” Benefits Derived by the Advisor. The Board considered the possible existence of collateral benefits the Advisor may receive as a result of its relationship with the Fund. They concluded that the Advisor’s primary business is managing funds and it generally does not use fund or shareholder information to generate profits in other lines of business, and therefore does not derive any significant collateral benefits from them. To the extent there are potential collateral benefits, the Board has been advised and has taken this into consideration in its review of the management contract with the Fund. The Board noted that additional assets from other clients may offer the Advisor some benefit from increased leverage with service providers and counterparties. Additionally, the Advisor may receive proprietary research from broker-dealers that execute fund portfolio transactions, which the Board concluded is likely to benefit other clients of the Advisor, as well as Fund shareholders. The Board also determined that the Advisor is able to provide investment management services to certain clients other than the Fund, at least in part, due to its existing infrastructure built to serve the fund complex. The Board concluded that appropriate allocation methodologies had been employed to assign resources and the cost of those resources to these other clients.
Existing Relationship. The Board also considered whether there was any reason for not continuing the existing arrangement with the Advisor. In this regard, the Board was mindful of the potential disruptions of the Fund’s operations and various risks, uncertainties, and other effects that could occur as a result of a decision not to continue such relationship. In particular, the Board recognized that most shareholders have invested in the Fund on the strength of the Advisor’s industry standing and reputation and in the expectation that the Advisor will have a continuing role in providing advisory services to the Fund.
Conclusion of the Directors. As a result of this process, the Board, including all of the independent Directors, taking into account all of the factors discussed above and the information provided by the Advisor and others in connection with its review and throughout the year, determined that the management fee is fair and reasonable in light of the services provided and that the investment management agreement between the Fund and the Advisor should be renewed.
36
Additional Information |
Retirement Account Information
As required by law, distributions you receive from certain retirement accounts are subject to federal income tax withholding, unless you elect not to have withholding apply*. Tax will be withheld on the total amount withdrawn even though you may be receiving amounts that are not subject to withholding, such as nondeductible contributions. In such case, excess amounts of withholding could occur. You may adjust your withholding election so that a greater or lesser amount will be withheld.
If you don’t want us to withhold on this amount, you must notify us to not withhold the federal income tax. You may notify us in writing or in certain situations by telephone or through other electronic means. For systematic withdrawals, your withholding election will remain in effect until revoked or changed by filing a new election. You have the right to revoke your election at any time and change your withholding percentage for future distributions.
Remember, even if you elect not to have income tax withheld, you are liable for paying income tax on the taxable portion of your withdrawal. If you elect not to have income tax withheld or you don’t have enough income tax withheld, you may be responsible for payment of estimated tax. You may incur penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. You can reduce or defer the income tax on a distribution by directly or indirectly rolling such distribution over to another IRA or eligible plan. You should consult your tax advisor for additional information.
State tax will be withheld if, at the time of your distribution, your address is within one of the mandatory withholding states and you have federal income tax withheld (or as otherwise required by state law). State taxes will be withheld from your distribution in accordance with the respective state rules.
*Some 403(b), 457 and qualified retirement plan distributions may be subject to 20% mandatory withholding, as they are subject to special tax and withholding rules. Your plan administrator or plan sponsor is required to provide you with a special tax notice explaining those rules at the time you request a distribution. If applicable, federal and/or state taxes may be withheld from your distribution amount.
Proxy Voting Policies
A description of the policies that the fund's investment advisor uses in exercising the voting rights associated with the securities purchased and/or held by the fund is available without charge, upon request, by calling 1-800-345-2021. It is also available on American Century Investments’ website at americancentury.com/proxy and on the Securities and Exchange Commission’s website at sec.gov. Information regarding how the investment advisor voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on americancentury.com/proxy. It is also available at sec.gov.
Quarterly Portfolio Disclosure
The fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. These portfolio holdings are available on the fund's website at americancentury.com and, upon request, by calling 1-800-345-2021. The fund’s Form N-PORT reports are available on the SEC’s website at sec.gov.
37
Other Tax Information
The following information is provided pursuant to provisions of the Internal Revenue Code.
The funds hereby designates up to the maximum amount allowable as qualified dividend income for the fiscal year ended November 30, 2021.
For the fiscal year ended November 30, 2021, the fund intends to pass through to shareholders foreign source income of $2,580,364 and foreign taxes paid of $145,176, or up to the maximum amount allowable, as a foreign tax credit. Foreign source income and foreign tax expense per outstanding share on November 30, 2021 are $0.3063 and $0.0172, respectively.
38
Notes |
39
Notes |
40
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Contact Us | americancentury.com | |||||||
Automated Information Line | 1-800-345-8765 | |||||||
Investor Services Representative | 1-800-345-2021 or 816-531-5575 | |||||||
Investors Using Advisors | 1-800-378-9878 | |||||||
Business, Not-For-Profit, Employer-Sponsored Retirement Plans | 1-800-345-3533 | |||||||
Banks and Trust Companies, Broker-Dealers, Financial Professionals, Insurance Companies | 1-800-345-6488 | |||||||
Telecommunications Relay Service for the Deaf | 711 | |||||||
American Century World Mutual Funds, Inc. | ||||||||
Investment Advisor: American Century Investment Management, Inc. Kansas City, Missouri | ||||||||
This report and the statements it contains are submitted for the general information of our shareholders. The report is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. | ||||||||
©2022 American Century Proprietary Holdings, Inc. All rights reserved. CL-ANN-91029 2201 |
![image37.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image37.jpg)
Annual Report | |||||
November 30, 2021 | |||||
Non-U.S. Intrinsic Value Fund | |||||
Investor Class (ANTUX) | |||||
I Class (ANVHX) | |||||
A Class (ANVLX) | |||||
R Class (ANVRX) | |||||
R6 Class (ANVMX) | |||||
G Class (ANTGX) |
Table of Contents |
President’s Letter | |||||
Performance | |||||
Portfolio Commentary | |||||
Fund Characteristics | |||||
Shareholder Fee Example | |||||
Schedule of Investments | |||||
Statement of Assets and Liabilities | |||||
Statement of Operations | |||||
Statement of Changes in Net Assets | |||||
Notes to Financial Statements | |||||
Financial Highlights | |||||
Report of Independent Registered Public Accounting Firm | |||||
Management | |||||
Approval of Management Agreement | |||||
Additional Information |
Any opinions expressed in this report reflect those of the author as of the date of the report, and do not necessarily represent the opinions of American Century Investments® or any other person in the American Century Investments organization. Any such opinions are subject to change at any time based upon market or other conditions and American Century Investments disclaims any responsibility to update such opinions. These opinions may not be relied upon as investment advice and, because investment decisions made by American Century Investments funds are based on numerous factors, may not be relied upon as an indication of trading intent on behalf of any American Century Investments fund. Security examples are used for representational purposes only and are not intended as recommendations to purchase or sell securities. Performance information for comparative indices and securities is provided to American Century Investments by third party vendors. To the best of American Century Investments’ knowledge, such information is accurate at the time of printing.
President’s Letter |
![image30a.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image30a.jpg)
Dear Investor:
Thank you for reviewing this annual report for the period ended November 30, 2021. Annual reports help convey important information about fund returns, including market factors that affected performance. For additional investment insights, please visit americancentury.com.
Global Stocks Advanced Despite Lingering and New Challenges
Global stocks broadly delivered solid gains for the 12-month period, even as pandemic-related challenges persisted. Improving economic data, along with central bank and government support and positive vaccine developments, helped boost corporate earnings and promote investor optimism. The U.S. generally outpaced other nations. Virus outbreaks and slower vaccine rollouts, particularly in emerging markets, led to lingering lockdowns in some regions.
As the period progressed, steady economic gains combined with ongoing monetary and fiscal support, rising energy prices and severe supply chain disruptions pushed global interest rates and inflation higher. In the U.S., year-over-year headline inflation climbed to 6.8% in November 2021, the largest 12-month increase in nearly 40 years. Similarly, inflation in the eurozone hit a 30-year high, while prices in the U.K. climbed to their highest level in 10 years.
Late in the period, the Federal Reserve began tapering its bond buying while adopting a more hawkish rate-tightening outlook amid surging inflation. However, central banks in Europe and the U.K. maintained their supportive programs, expressing concerns about slowing global growth outlooks. Meanwhile, the emergence of a new COVID-19 variant in late November triggered a steep sell-off among global stocks to end the reporting period.
Despite mounting inflation worries and late-period volatility, global stocks delivered solid performance for the full 12 months, highlighted by strong gains in developed markets. Emerging markets stocks generally delivered more modest returns.
Several Factors Shaping Market Dynamics
The return to pre-pandemic life is progressing, albeit somewhat cautiously due to COVID-19’s lingering effects. As the economy and markets respond to this fluid backdrop, investors will face opportunities and ongoing challenges. Economic growth, inflation, the virus’s trajectory, supply chain normalization and fiscal and monetary policy likely will sway market dynamics.
We appreciate your confidence in us during these extraordinary times. Our firm has a long history of helping clients weather unpredictable markets, and we’re confident we will continue to meet today’s challenges.
Sincerely,
![image23.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image23.jpg)
Jonathan Thomas
President and Chief Executive Officer
American Century Investments
2
Performance |
Total Returns as of November 30, 2021 | ||||||||||||||
Average Annual Returns | ||||||||||||||
Ticker Symbol | 1 year | Since Inception | Inception Date | |||||||||||
Investor Class | ANTUX | 10.15% | 1.19% | 12/6/18 | ||||||||||
MSCI ACWI ex-U.S. Index | — | 9.14% | 10.94% | — | ||||||||||
I Class | ANVHX | 10.47% | -0.45% | 12/3/19 | ||||||||||
A Class | ANVLX | 12/3/19 | ||||||||||||
No sales charge | 9.89% | -0.89% | ||||||||||||
With sales charge | 3.54% | -3.80% | ||||||||||||
R Class | ANVRX | 9.65% | -1.18% | 12/3/19 | ||||||||||
R6 Class | ANVMX | 10.57% | -0.31% | 12/3/19 | ||||||||||
G Class | ANTGX | 11.56% | 2.53% | 12/6/18 |
G Class returns would have been lower if a portion of the fees had not been waived.
Sales charges include initial sales charges and contingent deferred sales charges (CDSCs), as applicable. A Class shares have a 5.75% maximum initial sales charge and may be subject to a maximum CDSC of 1.00%. The SEC requires that mutual funds provide performance information net of maximum sales charges in all cases where charges could be applied.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
3
Growth of $10,000 Over Life of Class | ||
$10,000 investment made December 6, 2018 | ||
Performance for other share classes will vary due to differences in fee structure. |
![chart-01334c22e69e466a86f.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/chart-01334c22e69e466a86f.jpg)
Value on November 30, 2021 | |||||
Investor Class — $10,361 | |||||
MSCI ACWI ex-U.S. Index — $13,633 | |||||
Total Annual Fund Operating Expenses | |||||||||||||||||
Investor Class | I Class | A Class | R Class | R6 Class | G Class | ||||||||||||
1.17% | 0.97% | 1.42% | 1.67% | 0.82% | 0.82% |
The total annual fund operating expenses shown is as stated in the fund’s prospectus current as of the date of this report. The prospectus may vary from the expense ratio shown elsewhere in this report because it is based on a different time period, includes acquired fund fees and expenses, and, if applicable, does not include fee waivers or expense reimbursements.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
4
Portfolio Commentary |
Portfolio Managers: Alvin Polit and Jonathan Veiga
Performance Summary
Non-U.S. Intrinsic Value rose 10.15%* for the 12 months ended November 30, 2021. The fund’s benchmark, the MSCI ACWI ex-U.S. Index, rose 9.14% for the same time period. The fund’s return reflects operating expenses, while the index’s return does not.
Despite renewed pandemic concerns toward the end of the reporting period, COVID-19 vaccine rollouts and fiscal and monetary stimulus aided the global economic recovery and supported equities. In turn, several of our positions in the communication services, consumer discretionary and financials sectors outperformed. On the other hand, our continued underweight in information technology, coupled with our choice of investments in the sector, detracted from relative performance. Positions in the health care sector also weighed on results.
Communication Services, Consumer Discretionary and Financials Were Areas of Strength
Within the communication services sector, our holdings in the media industry benefited from global economic reopening. WPP, a U.K.-based advertising company, and Publicis Groupe, a France-based multinational advertising and public relations company, both outperformed as improving business activity led to strong financial results.
Several of our consumer discretionary holdings also outperformed over the trailing 12-month period, including Daimler. Like other automobile manufacturers, Daimler’s production and sales were pressured by the global semiconductor shortage. However, Daimler’s earnings remained solid as strong pricing, improved product mix and cost controls offset semiconductor-related volume headwinds. Additionally, shareholders approved a spin-off of Daimler’s truck and bus business, creating two independent companies that we believe should be able to operate more nimbly. Kingfisher, a U.K.-based home improvement retailer, was another notable contributor. Throughout the pandemic, this company successfully met increasing demand for do-it-yourself products. In addition, Kingfisher ramped up its e-commerce offering and reduced costs, leading to solid financial results. We exited our position in Kingfisher after the shares reached our estimate of intrinsic value.
In the financials sector, several of our bank holdings positively impacted relative results, including Barclays. The U.K.-based bank reported solid financial results that were driven by a surge in investment banking fees and receding credit concerns. Shares were also supported by news that interest rates may rise sooner than anticipated due to rising inflation. BNP Paribas was another key contributor. This large France-based bank benefited from strong operating results, positive COVID-19 vaccine developments and ongoing talk of potential industry consolidation. BNP also began paying a dividend after halting it in 2020 amid pandemic-related uncertainty and announced a sizable share repurchase program. BNP’s rebound in equity trading, lower-than-expected provisions for bad loans and expense-cutting measures also positively impacted shares.
Information Technology and Health Care Detracted
Our underweight in the information technology sector relative to the benchmark detracted from relative returns. In addition, our position in Atos, an information technology consulting company based in France, negatively impacted performance. The company’s restructuring efforts have been
disappointing to date, prompting the board to hire a new chief executive officer. In addition,
*All fund returns referenced in this commentary are for Investor Class shares. Performance for other share classes will vary due to differences in fee structure; when Investor Class performance exceeds that of the fund’s benchmark, other share classes may not. See page 3 for returns for all share classes.
5
auditors found accounting errors at two U.S. subsidiaries that generate roughly 10% of the company’s revenues. Furthermore, customers accelerated their transition to the cloud as the global economy recovered, pressuring Atos’ legacy infrastructure business.
Several of the portfolio’s notable detractors were health care holdings, particularly in the pharmaceuticals industry. Japan-based Takeda Pharmaceutical underperformed on concerns that the company’s increased investment in research and development may negatively impact earnings. While this may indeed temporarily depress profitability, we believe it should lead to strong long-term results. Shares of Sanofi, a France-based pharmaceutical company, were negatively impacted by news of disappointing phase 3 trial results for a drug aimed at treating a rare autoimmune skin condition.
While security selection within the financials sector was positive overall, one of the portfolio’s largest detractors was Credit Suisse Group, a global wealth manager, investment bank and financial services company based in Switzerland. The company’s financial results were impacted by high-profile risk management failures, including losses related to the collapse of Archegos Capital Management and Greensill Capital along with related litigation charges and concerns about client and employee turnover. We believe the issues are solvable and have overshadowed Credit Suisse’s resilient wealth management and commercial banking operations.
Portfolio Positioning
The portfolio continues to invest in companies where we believe the fundamentals are not being fully reflected by the market. Our process is conducted purely on a bottom-up basis, but broad themes have emerged.
As of November 30, 2021, the financials sector represents a significant portion of the portfolio. We own several large, higher-quality Europe- and Japan-based banks that we believe offer compelling valuations. Many of our bank holdings have the flexibility to increase lending due to strong capital levels and low loan-to-deposit ratios and increase returns to shareholders via dividends and buybacks, reinforcing our view that industry dynamics favor larger banks. Through our research, we have also identified opportunities in the health care sector, including large pharmaceutical companies that offer well-diversified businesses, solid pipelines and attractive valuations. Furthermore, we continue to favor automobile manufacturers that we believe are higher quality and offer stronger balance sheets, better brands and more favorable technology, putting them in a position to thrive as the industry transitions to electric and autonomous vehicles.
On the other hand, we see limited opportunities in information technology. Our investment process focuses on earnings sustainability over long time periods, but technology is prone to obsolescence risk and short product life cycles. However, we have exposure to select companies commonly referred to as technology companies by the media but classified by the Global Industry Classification Standard as consumer discretionary or communication services. We believe these companies have built durable businesses that are less susceptible to becoming obsolete. In addition, we ended the period with no exposure to the consumer staples sector. Investors have flocked to consumer staples stocks due to the more durable revenue streams offered by many of these businesses, driving valuations up to levels that don’t meet our valuation criteria.
On a regional basis, we ended the period with an overweight in Europe and an underweight in emerging markets relative to the benchmark. Within Europe, some of our largest country overweights include the U.K. and France, where we have identified compelling value opportunities across sectors. While we are underweight in emerging markets overall, our bottom-up investment approach has led us to attractively valued holdings in several emerging markets countries, including China, Russia, Brazil, Turkey and Mexico.
6
Fund Characteristics |
NOVEMBER 30, 2021 | |||||
Types of Investments in Portfolio | % of net assets | ||||
Common Stocks | 95.8% | ||||
Exchange-Traded Funds | 1.3% | ||||
Temporary Cash Investments | 2.8% | ||||
Other Assets and Liabilities | 0.1% | ||||
Top Five Countries* | % of net assets | ||||
United Kingdom | 23.5% | ||||
Japan | 16.3% | ||||
France | 13.0% | ||||
China | 9.0% | ||||
Germany | 7.6% |
*Exposure indicated excludes Exchange-Traded Funds. The Schedule of Investments provides additional information on the fund's portfolio holdings.
7
Shareholder Fee Example |
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption/exchange fees; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in your fund and to compare these costs with the ongoing cost of investing in other mutual funds.
The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period from May 29, 2021 to November 30, 2021.
Actual Expenses
The table provides information about actual account values and actual expenses for each class. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. First, identify the share class you own. Then simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
If you hold Investor Class shares of any American Century Investments fund, or I Class shares of the American Century Diversified Bond Fund, in an American Century Investments account (i.e., not through a financial intermediary or employer-sponsored retirement plan account), American Century Investments may charge you a $25.00 annual account maintenance fee if the value of those shares is less than $10,000. We will redeem shares automatically in one of your accounts to pay the $25.00 fee. In determining your total eligible investment amount, we will include your investments in all personal accounts (including American Century Investments brokerage accounts) registered under your Social Security number. Personal accounts include individual accounts, joint accounts, UGMA/UTMA accounts, personal trusts, Coverdell Education Savings Accounts and IRAs (including traditional, Roth, Rollover, SEP-, SARSEP- and SIMPLE-IRAs), and certain other retirement accounts. If you have only business, business retirement, employer-sponsored or American Century Investments brokerage accounts, you are currently not subject to this fee. If you are subject to the account maintenance fee, your account value could be reduced by the fee amount.
Hypothetical Example for Comparison Purposes
The table also provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each class of your fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of a fund’s share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption/exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
8
Beginning Account Value 5/29/21 | Ending Account Value 11/30/21 | Expenses Paid During Period(1) 5/29/21 - 11/30/21 | Annualized Expense Ratio(1) | |||||||||||
Actual | ||||||||||||||
Investor Class | $1,000 | $908.80 | $5.84 | 1.20% | ||||||||||
I Class | $1,000 | $910.60 | $4.87 | 1.00% | ||||||||||
A Class | $1,000 | $908.60 | $7.05 | 1.45% | ||||||||||
R Class | $1,000 | $906.60 | $8.26 | 1.70% | ||||||||||
R6 Class | $1,000 | $911.10 | $4.14 | 0.85% | ||||||||||
G Class | $1,000 | $915.00 | $0.00 | 0.00%(2) | ||||||||||
Hypothetical | ||||||||||||||
Investor Class | $1,000 | $1,019.36 | $6.17 | 1.20% | ||||||||||
I Class | $1,000 | $1,020.38 | $5.15 | 1.00% | ||||||||||
A Class | $1,000 | $1,018.09 | $7.46 | 1.45% | ||||||||||
R Class | $1,000 | $1,016.82 | $8.74 | 1.70% | ||||||||||
R6 Class | $1,000 | $1,021.15 | $4.38 | 0.85% | ||||||||||
G Class | $1,000 | $1,025.48 | $0.00 | 0.00%(2) |
(1)Expenses are equal to the class's annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 186, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. Annualized expense ratio reflects actual expenses, including any applicable fee waivers or expense reimbursements and excluding any acquired fund fees and expenses.
(2)Other expenses, which include directors' fees and expenses, did not exceed 0.005%.
9
Schedule of Investments |
NOVEMBER 30, 2021
Shares | Value | |||||||
COMMON STOCKS — 95.8% | ||||||||
Brazil — 3.5% | ||||||||
Banco Bradesco SA | 3,621,679 | $ | 10,996,746 | |||||
Banco do Brasil SA | 2,091,600 | 11,790,212 | ||||||
22,786,958 | ||||||||
Canada — 3.4% | ||||||||
Linamar Corp. | 114,794 | 6,590,467 | ||||||
Teck Resources Ltd., Class B | 573,379 | 15,188,810 | ||||||
21,779,277 | ||||||||
China — 9.0% | ||||||||
Alibaba Group Holding Ltd.(1) | 905,100 | 14,452,359 | ||||||
Autohome, Inc., ADR | 170,195 | 5,815,563 | ||||||
Baidu, Inc., Class A(1) | 844,200 | 15,769,287 | ||||||
Tencent Holdings Ltd. | 384,000 | 22,394,518 | ||||||
58,431,727 | ||||||||
France — 13.0% | ||||||||
Atos SE | 127,811 | 5,462,457 | ||||||
BNP Paribas SA | 228,111 | 14,177,011 | ||||||
Publicis Groupe SA | 295,184 | 19,101,003 | ||||||
Sanofi | 242,249 | 23,028,749 | ||||||
Sanofi, ADR | 129,155 | 6,143,903 | ||||||
Societe Generale SA | 328,465 | 10,220,948 | ||||||
TotalEnergies SE | 135,843 | 6,250,512 | ||||||
84,384,583 | ||||||||
Germany — 7.6% | ||||||||
Bayerische Motoren Werke AG | 272,971 | 26,165,202 | ||||||
Daimler AG | 250,218 | 23,433,670 | ||||||
49,598,872 | ||||||||
Italy — 0.9% | ||||||||
UniCredit SpA | 492,391 | 5,945,039 | ||||||
Japan — 16.3% | ||||||||
Alfresa Holdings Corp. | 652,900 | 8,833,696 | ||||||
Haseko Corp. | 456,600 | 5,423,120 | ||||||
Hazama Ando Corp. | 397,600 | 2,946,395 | ||||||
Mitsubishi UFJ Financial Group, Inc. | 4,126,000 | 21,790,978 | ||||||
Mizuho Financial Group, Inc. | 1,108,100 | 13,661,385 | ||||||
Nissan Motor Co. Ltd.(1) | 3,037,900 | 15,021,325 | ||||||
Sumitomo Mitsui Financial Group, Inc. | 411,300 | 13,381,605 | ||||||
Sumitomo Rubber Industries Ltd. | 513,800 | 5,149,547 | ||||||
Takeda Pharmaceutical Co. Ltd. | 565,000 | 15,115,416 | ||||||
Token Corp. | 36,400 | 2,861,838 | ||||||
Yamazen Corp. | 221,200 | 1,892,728 | ||||||
106,078,033 | ||||||||
Mexico — 1.1% | ||||||||
Fibra Uno Administracion SA de CV | 7,622,519 | 7,020,858 | ||||||
Netherlands — 1.3% | ||||||||
Aegon NV | 1,840,408 | 8,123,242 |
10
Shares | Value | |||||||
Russia — 5.0% | ||||||||
MMC Norilsk Nickel PJSC | 72,814 | $ | 21,102,753 | |||||
Surgutneftegas PJSC, Preference Shares | 23,025,055 | 11,647,663 | ||||||
32,750,416 | ||||||||
South Korea — 1.6% | ||||||||
Hyundai Mobis Co. Ltd. | 56,599 | 10,504,531 | ||||||
Spain — 2.4% | ||||||||
Banco Bilbao Vizcaya Argentaria SA | 1,622,778 | 8,603,354 | ||||||
Indra Sistemas SA(1) | 618,365 | 7,224,770 | ||||||
15,828,124 | ||||||||
Switzerland — 4.5% | ||||||||
Credit Suisse Group AG | 1,833,820 | 17,706,270 | ||||||
Novartis AG | 147,609 | 11,765,284 | ||||||
29,471,554 | ||||||||
Turkey — 2.7% | ||||||||
Turkiye Sise ve Cam Fabrikalari AS | 19,314,244 | 17,542,910 | ||||||
United Kingdom — 23.5% | ||||||||
AstraZeneca plc, ADR | 530,182 | 29,069,879 | ||||||
BAE Systems plc | 1,863,573 | 13,572,115 | ||||||
Barclays plc | 9,923,967 | 24,231,142 | ||||||
BT Group plc(1) | 2,042,892 | 4,300,480 | ||||||
Capita plc(1) | 5,085,665 | 2,970,960 | ||||||
GlaxoSmithKline plc | 1,831,025 | 37,175,471 | ||||||
Standard Chartered plc (London) | 1,603,732 | 8,825,519 | ||||||
Taylor Wimpey plc | 8,149,960 | 17,116,891 | ||||||
WPP plc | 1,144,569 | 15,886,745 | ||||||
153,149,202 | ||||||||
TOTAL COMMON STOCKS (Cost $600,189,822) | 623,395,326 | |||||||
EXCHANGE-TRADED FUNDS — 1.3% | ||||||||
iShares MSCI EAFE Value ETF (Cost $9,268,824) | 177,688 | 8,694,274 | ||||||
TEMPORARY CASH INVESTMENTS — 2.8% | ||||||||
Repurchase Agreement, BMO Capital Markets Corp., (collateralized by various U.S. Treasury obligations, 0.125% - 2.625%, 6/30/22 - 5/15/51, valued at $4,234,085), in a joint trading account at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $4,145,295) | 4,145,293 | |||||||
Repurchase Agreement, Fixed Income Clearing Corp., (collateralized by various U.S. Treasury obligations, 1.00%, 7/31/28, valued at $14,104,648), at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $13,828,008) | 13,828,000 | |||||||
State Street Institutional U.S. Government Money Market Fund, Premier Class | 64,256 | 64,256 | ||||||
TOTAL TEMPORARY CASH INVESTMENTS (Cost $18,037,549) | 18,037,549 | |||||||
TOTAL INVESTMENT SECURITIES — 99.9% (Cost $627,496,195) | 650,127,149 | |||||||
OTHER ASSETS AND LIABILITIES — 0.1% | 854,115 | |||||||
TOTAL NET ASSETS — 100.0% | $ | 650,981,264 |
11
MARKET SECTOR DIVERSIFICATION | |||||
(as a % of net assets) | |||||
Financials | 26.0% | ||||
Health Care | 20.2% | ||||
Consumer Discretionary | 19.3% | ||||
Communication Services | 12.8% | ||||
Materials | 5.6% | ||||
Industrials | 5.6% | ||||
Energy | 2.8% | ||||
Information Technology | 2.4% | ||||
Real Estate | 1.1% | ||||
Exchange-Traded Funds | 1.3% | ||||
Temporary Cash Investments | 2.8% | ||||
Other Assets and Liabilities | 0.1% |
NOTES TO SCHEDULE OF INVESTMENTS | ||||||||
ADR | - | American Depositary Receipt |
(1)Non-income producing.
See Notes to Financial Statements.
12
Statement of Assets and Liabilities |
NOVEMBER 30, 2021 | |||||
Assets | |||||
Investment securities, at value (cost of $627,496,195) | $ | 650,127,149 | |||
Foreign currency holdings, at value (cost of $373,986) | 373,553 | ||||
Receivable for investments sold | 1,998,903 | ||||
Receivable for capital shares sold | 265,997 | ||||
Dividends and interest receivable | 3,761,897 | ||||
656,527,499 | |||||
Liabilities | |||||
Payable for investments purchased | 5,386,122 | ||||
Payable for capital shares redeemed | 6,351 | ||||
Accrued management fees | 153,762 | ||||
5,546,235 | |||||
Net Assets | $ | 650,981,264 | |||
Net Assets Consist of: | |||||
Capital (par value and paid-in surplus) | $ | 598,688,696 | |||
Distributable earnings | 52,292,568 | ||||
$ | 650,981,264 |
Net Assets | Shares Outstanding | Net Asset Value Per Share | |||||||||
Investor Class, $0.01 Par Value | $152,992,579 | 15,671,651 | $9.76 | ||||||||
I Class, $0.01 Par Value | $194,452 | 19,890 | $9.78 | ||||||||
A Class, $0.01 Par Value | $12,731 | 1,308 | $9.73* | ||||||||
R Class, $0.01 Par Value | $31,138 | 3,207 | $9.71 | ||||||||
R6 Class, $0.01 Par Value | $4,968 | 500 | $9.94 | ||||||||
G Class, $0.01 Par Value | $497,745,396 | 50,295,231 | $9.90 |
*Maximum offering price $10.32 (net asset value divided by 0.9425).
See Notes to Financial Statements.
13
Statement of Operations |
YEAR ENDED NOVEMBER 30, 2021 | |||||
Investment Income (Loss) | |||||
Income: | |||||
Dividends (net of foreign taxes withheld of $2,365,390) | $ | 19,647,454 | |||
Interest | 3,357 | ||||
19,650,811 | |||||
Expenses: | |||||
Management fees | 6,350,266 | ||||
Distribution and service fees: | |||||
A Class | 22 | ||||
R Class | 129 | ||||
Directors' fees and expenses | 16,524 | ||||
Other expenses | 10,519 | ||||
6,377,460 | |||||
Fees waived - G Class | (4,575,930) | ||||
1,801,530 | |||||
Net investment income (loss) | 17,849,281 | ||||
Realized and Unrealized Gain (Loss) | |||||
Net realized gain (loss) on: | |||||
Investment transactions | 40,248,822 | ||||
Foreign currency translation transactions | (129,325) | ||||
40,119,497 | |||||
Change in net unrealized appreciation (depreciation) on: | |||||
Investments | 3,427,268 | ||||
Translation of assets and liabilities in foreign currencies | (139,538) | ||||
3,287,730 | |||||
Net realized and unrealized gain (loss) | 43,407,227 | ||||
Net Increase (Decrease) in Net Assets Resulting from Operations | $ | 61,256,508 |
See Notes to Financial Statements.
14
Statement of Changes in Net Assets |
YEARS ENDED NOVEMBER 30, 2021 AND NOVEMBER 30, 2020 | ||||||||
Increase (Decrease) in Net Assets | November 30, 2021 | November 30, 2020 | ||||||
Operations | ||||||||
Net investment income (loss) | $ | 17,849,281 | $ | 9,946,244 | ||||
Net realized gain (loss) | 40,119,497 | (22,013,715) | ||||||
Change in net unrealized appreciation (depreciation) | 3,287,730 | 11,283,844 | ||||||
Net increase (decrease) in net assets resulting from operations | 61,256,508 | (783,627) | ||||||
Distributions to Shareholders | ||||||||
From earnings: | ||||||||
Investor Class | (1,430,575) | (4,358,940) | ||||||
I Class | (70) | (218) | ||||||
A Class | (49) | (216) | ||||||
R Class | (56) | (215) | ||||||
R6 Class | (75) | (215) | ||||||
G Class | (11,626,760) | (14,604,585) | ||||||
Decrease in net assets from distributions | (13,057,585) | (18,964,389) | ||||||
Capital Share Transactions | ||||||||
Net increase (decrease) in net assets from capital share transactions (Note 5) | 32,025,752 | 224,041,779 | ||||||
Net increase (decrease) in net assets | 80,224,675 | 204,293,763 | ||||||
Net Assets | ||||||||
Beginning of period | 570,756,589 | 366,462,826 | ||||||
End of period | $ | 650,981,264 | $ | 570,756,589 |
See Notes to Financial Statements.
15
Notes to Financial Statements |
NOVEMBER 30, 2021
1. Organization
American Century World Mutual Funds, Inc. (the corporation) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company and is organized as a Maryland corporation. Non-U.S. Intrinsic Value Fund (the fund) is one fund in a series issued by the corporation. The fund’s investment objective is to seek capital appreciation.
The fund offers the Investor Class, I Class, A Class, R Class, R6 Class and G Class. The A Class may incur an initial sales charge and may be subject to a contingent deferred sales charge. Sale of the I Class, A Class, R Class and R6 Class commenced on December 3, 2019.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently followed by the fund in preparation of its financial statements. The fund is an investment company and follows accounting and reporting guidance in accordance with accounting principles generally accepted in the United States of America. This may require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from these estimates. Management evaluated the impact of events or transactions occurring through the date the financial statements were issued that would merit recognition or disclosure.
Investment Valuations — The fund determines the fair value of its investments and computes its net asset value (NAV) per share at the close of regular trading (usually 4 p.m. Eastern time) on the New York Stock Exchange (NYSE) on each day the NYSE is open. The Board of Directors has adopted valuation policies and procedures to guide the investment advisor in the fund’s investment valuation process and to provide methodologies for the oversight of the fund’s pricing function.
Equity securities that are listed or traded on a domestic securities exchange are valued at the last reported sales price or at the official closing price as provided by the exchange. Equity securities traded on foreign securities exchanges are generally valued at the closing price of such securities on the exchange where primarily traded or at the close of the NYSE, if that is earlier. If no last sales price is reported, or if local convention or regulation so provides, the mean of the latest bid and asked prices may be used. Securities traded over-the-counter are valued at the mean of the latest bid and asked prices, the last sales price, or the official closing price. Equity securities initially expressed in local currencies are translated into U.S. dollars at the mean of the appropriate currency exchange rate at the close of the NYSE as provided by an independent pricing service.
Open-end management investment companies are valued at the reported NAV per share. Repurchase agreements are valued at cost, which approximates fair value.
If the fund determines that the market price for an investment is not readily available or the valuation methods mentioned above do not reflect an investment’s fair value, such investment is valued as determined in good faith by the Board of Directors or its delegate, in accordance with policies and procedures adopted by the Board of Directors. In its determination of fair value, the fund may review several factors including, but not limited to, market information regarding the specific investment or comparable investments and correlation with other investment types, futures indices or general market indicators. Circumstances that may cause the fund to use these procedures to value an investment include, but are not limited to: an investment has been declared in default or is distressed; trading in a security has been suspended during the trading day or a security is not actively trading on its principal exchange; prices received from a regular pricing source are deemed unreliable; or there is a foreign market holiday and no trading occurred.
16
The fund monitors for significant events occurring after the close of an investment’s primary exchange but before the fund’s NAV per share is determined. Significant events may include, but are not limited to: corporate announcements and transactions; governmental action and political unrest that could impact a specific investment or an investment sector; or armed conflicts, natural disasters and similar events that could affect investments in a specific country or region. The fund also monitors for significant fluctuations between domestic and foreign markets, as evidenced by the U.S. market or such other indicators that the Board of Directors, or its delegate, deems appropriate. The fund may apply a model-derived factor to the closing price of equity securities traded on foreign securities exchanges. The factor is based on observable market data as provided by an independent pricing service.
Security Transactions — Security transactions are accounted for as of the trade date. Net realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes.
Investment Income — Dividend income less foreign taxes withheld, if any, is recorded as of the ex-dividend date. Distributions received on securities that represent a return of capital or long-term capital gain are recorded as a reduction of cost of investments and/or as a realized gain. The fund may estimate the components of distributions received that may be considered nontaxable distributions or long-term capital gain distributions for income tax purposes. Interest income is recorded on the accrual basis and includes accretion of discounts and amortization of premiums.
Foreign Currency Translations — All assets and liabilities initially expressed in foreign currencies are translated into U.S. dollars at prevailing exchange rates at period end. The fund may enter into spot foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of investment securities, dividend and interest income, spot foreign currency exchange contracts, and expenses are translated at the rates of exchange prevailing on the respective dates of such transactions. Net realized and unrealized foreign currency exchange gains or losses related to investment securities are a component of net realized gain (loss) on investment transactions and change in net unrealized appreciation (depreciation) on investments, respectively.
Repurchase Agreements — The fund may enter into repurchase agreements with institutions that American Century Investment Management, Inc. (ACIM) (the investment advisor) has determined are creditworthy pursuant to criteria adopted by the Board of Directors. The fund requires that the collateral, represented by securities, received in a repurchase transaction be transferred to the custodian in a manner sufficient to enable the fund to obtain those securities in the event of a default under the repurchase agreement. ACIM monitors, on a daily basis, the securities transferred to ensure the value, including accrued interest, of the securities under each repurchase agreement is equal to or greater than amounts owed to the fund under each repurchase agreement.
Joint Trading Account — Pursuant to an Exemptive Order issued by the Securities and Exchange Commission, the fund, along with certain other funds in the American Century Investments family of funds, may transfer uninvested cash balances into a joint trading account. These balances are invested in one or more repurchase agreements that are collateralized by U.S. Treasury or Agency obligations.
Income Tax Status — It is the fund’s policy to distribute substantially all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code. Accordingly, no provision has been made for income taxes. The fund files U.S. federal, state, local and non-U.S. tax returns as applicable. The fund's tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years from the date of filing but can be longer in certain jurisdictions. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Multiple Class — All shares of the fund represent an equal pro rata interest in the net assets of the class to which such shares belong, and have identical voting, dividend, liquidation and other rights and the same terms and conditions, except for class specific expenses and exclusive rights to vote on matters affecting only individual classes. Income, non-class specific expenses, and realized and unrealized capital gains and losses of the fund are allocated to each class of shares based on their relative net assets.
17
Distributions to Shareholders — Distributions from net investment income and net realized gains, if any, are generally declared and paid annually. The fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code, in all events in a manner consistent with provisions of the 1940 Act.
Indemnifications — Under the corporation’s organizational documents, its officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business, the fund enters into contracts that provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against a fund. The risk of material loss from such claims is considered by management to be remote.
3. Fees and Transactions with Related Parties
Certain officers and directors of the corporation are also officers and/or directors of American Century Companies, Inc. (ACC). The corporation’s investment advisor, ACIM, the corporation's distributor, American Century Investment Services, Inc. (ACIS), and the corporation’s transfer agent, American Century Services, LLC, are wholly owned, directly or indirectly, by ACC. Various funds issued by American Century Asset Allocation Portfolios, Inc. own, in aggregate, 55% of the shares of the fund. Related parties do not invest in the fund for the purpose of exercising management or control.
Management Fees — The corporation has entered into a management agreement with ACIM, under which ACIM provides the fund with investment advisory and management services in exchange for a single, unified management fee (the fee) per class. The agreement provides that ACIM will pay all expenses of managing and operating the fund, except brokerage expenses, taxes, interest, fees and expenses of the independent directors (including legal counsel fees), extraordinary expenses, and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the 1940 Act. The fee is computed and accrued daily based on each class's daily net assets and paid monthly in arrears. The difference in the fee among the classes is a result of their separate arrangements for non-Rule 12b-1 shareholder services. It is not the result of any difference in advisory or custodial fees or other expenses related to the management of the fund’s assets, which do not vary by class. The investment advisor agreed to waive the G Class's management fee in its entirety. The investment advisor expects this waiver to remain in effect permanently and cannot terminate it without the approval of the Board of Directors.
The annual management fee and the effective annual management fee for each class for the period ended November 30, 2021 are as follows:
Annual Management Fee* | Effective Annual Management Fee | |||||||
Investor Class | 1.15% | 1.25% | ||||||
I Class | 0.95% | 1.05% | ||||||
A Class | 1.15% | 1.25% | ||||||
R Class | 1.15% | 1.25% | ||||||
R6 Class | 0.80% | 0.90% | ||||||
G Class | 0.00%(1) | 0.00%(2) |
*Prior to August 1, 2021, the annual management fee was 1.30% for the Investor Class, A Class and R Class, 1.10% for the I Class and 0.95% for the R6 and G Class.
(1)Annual management fee before waiver was 0.80%.
(2)Effective annual management fee before waiver was 0.90%.
Distribution and Service Fees — The Board of Directors has adopted a separate Master Distribution and Individual Shareholder Services Plan for each of the A Class and R Class (collectively the plans), pursuant to Rule 12b-1 of the 1940 Act. The plans provide that the A Class will pay ACIS an annual distribution and service fee of 0.25%. The plans provide that the R Class will pay ACIS an annual distribution and service fee of 0.50%. The fees are computed and accrued daily based on each class’s daily net assets and paid monthly in arrears. The fees are used to pay financial intermediaries for distribution and individual shareholder services. Fees incurred under the plans during the period ended November 30, 2021 are detailed in the Statement of Operations.
18
Directors' Fees and Expenses — The Board of Directors is responsible for overseeing the investment advisor’s management and operations of the fund. The directors receive detailed information about the fund and its investment advisor regularly throughout the year, and meet at least quarterly with management of the investment advisor to review reports about fund operations. The fund’s officers do not receive compensation from the fund.
Interfund Transactions — The fund may enter into security transactions with other American Century Investments funds and other client accounts of the investment advisor, in accordance with the 1940 Act rules and procedures adopted by the Board of Directors. The rules and procedures require, among other things, that these transactions be effected at the independent current market price of the security. During the period, the interfund purchases and sales were $64,924 and $15,675, respectively. The effect of interfund transactions on the Statement of Operations was $(1,007) in net realized gain (loss) on investment transactions.
4. Investment Transactions
Purchases and sales of investment securities, excluding short-term investments, for the period ended November 30, 2021 were $373,940,091 and $343,836,177, respectively.
5. Capital Share Transactions
Transactions in shares of the fund were as follows:
Year ended November 30, 2021 | Year ended November 30, 2020(1) | |||||||||||||
Shares | Amount | Shares | Amount | |||||||||||
Investor Class/Shares Authorized | 130,000,000 | 130,000,000 | ||||||||||||
Sold | 4,534,364 | $ | 46,710,028 | 2,498,370 | $ | 19,418,404 | ||||||||
Issued in reinvestment of distributions | 158,244 | 1,430,521 | 409,675 | 4,358,940 | ||||||||||
Redeemed | (1,008,137) | (10,047,396) | (523,717) | (5,171,299) | ||||||||||
3,684,471 | 38,093,153 | 2,384,328 | 18,606,045 | |||||||||||
I Class/Shares Authorized | 50,000,000 | 50,000,000 | ||||||||||||
Sold | 19,679 | 201,790 | 479 | 5,000 | ||||||||||
Issued in reinvestment of distributions | 8 | 70 | 20 | 218 | ||||||||||
Redeemed | (296) | (3,012) | — | — | ||||||||||
19,391 | 198,848 | 499 | 5,218 | |||||||||||
A Class/Shares Authorized | 50,000,000 | 50,000,000 | ||||||||||||
Sold | 804 | 8,716 | 479 | 5,000 | ||||||||||
Issued in reinvestment of distributions | 5 | 49 | 20 | 216 | ||||||||||
809 | 8,765 | 499 | 5,216 | |||||||||||
R Class/Shares Authorized | 50,000,000 | 50,000,000 | ||||||||||||
Sold | 4,277 | 43,464 | 1,287 | 11,285 | ||||||||||
Issued in reinvestment of distributions | 6 | 56 | 20 | 215 | ||||||||||
Redeemed | (1,801) | (18,211) | (582) | (4,568) | ||||||||||
2,482 | 25,309 | 725 | 6,932 | |||||||||||
R6 Class/Shares Authorized | 60,000,000 | 60,000,000 | ||||||||||||
Sold | — | — | 472 | 5,000 | ||||||||||
Issued in reinvestment of distributions | 8 | 75 | 20 | 215 | ||||||||||
8 | 75 | 492 | 5,215 | |||||||||||
G Class/Shares Authorized | 340,000,000 | 340,000,000 | ||||||||||||
Sold | 6,193,840 | 62,730,403 | 31,175,888 | 251,690,777 | ||||||||||
Issued in reinvestment of distributions | 1,284,725 | 11,626,760 | 1,371,323 | 14,604,585 | ||||||||||
Redeemed | (8,027,946) | (80,657,561) | (6,283,725) | (60,882,209) | ||||||||||
(549,381) | (6,300,398) | 26,263,486 | 205,413,153 | |||||||||||
Net increase (decrease) | 3,157,780 | $ | 32,025,752 | 28,650,029 | $ | 224,041,779 |
(1)December 3, 2019 (commencement of sale) through November 30, 2020 for I Class, A Class, R Class and R6 Class.
19
6. Fair Value Measurements
The fund’s investments valuation process is based on several considerations and may use multiple inputs to determine the fair value of the investments held by the fund. In conformity with accounting principles generally accepted in the United States of America, the inputs used to determine a valuation are classified into three broad levels.
•Level 1 valuation inputs consist of unadjusted quoted prices in an active market for identical investments.
•Level 2 valuation inputs consist of direct or indirect observable market data (including quoted prices for comparable investments, evaluations of subsequent market events, interest rates, prepayment speeds, credit risk, etc.). These inputs also consist of quoted prices for identical investments initially expressed in local currencies that are adjusted through translation into U.S. dollars.
•Level 3 valuation inputs consist of unobservable data (including a fund’s own assumptions).
The level classification is based on the lowest level input that is significant to the fair valuation measurement. The valuation inputs are not necessarily an indication of the risks associated with investing in these securities or other financial instruments.
The following is a summary of the level classifications as of period end. The Schedule of Investments provides additional information on the fund’s portfolio holdings.
Level 1 | Level 2 | Level 3 | |||||||||
Assets | |||||||||||
Investment Securities | |||||||||||
Common Stocks | |||||||||||
Canada | $ | 15,188,810 | $ | 6,590,467 | — | ||||||
China | 5,815,563 | 52,616,164 | — | ||||||||
France | 6,143,903 | 78,240,680 | — | ||||||||
United Kingdom | 29,069,879 | 124,079,323 | — | ||||||||
Other Countries | — | 305,650,537 | — | ||||||||
Exchange-Traded Funds | 8,694,274 | — | — | ||||||||
Temporary Cash Investments | 64,256 | 17,973,293 | — | ||||||||
$ | 64,976,685 | $ | 585,150,464 | — |
7. Risk Factors
The value of the fund’s shares will go up and down, sometimes rapidly or unpredictably, based on the performance of the securities owned by the fund and other factors generally affecting the securities market. Market risks, including political, regulatory, economic and social developments, can affect the value of the fund’s investments. Natural disasters, public health emergencies, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse long-term effects on world economies and markets generally.
There are certain risks involved in investing in foreign securities. These risks include those resulting from political events (such as civil unrest, national elections and imposition of exchange controls), social and economic events (such as labor strikes and rising inflation), and natural disasters. Securities of foreign issuers may be less liquid and more volatile. Investing in emerging markets or a significant portion of assets in one country or region may accentuate these risks.
The fund is owned by a relatively small number of shareholders, and in the event such shareholders redeem, the ongoing operations of the fund may be at risk.
20
8. Federal Tax Information
On December 21, 2021, the fund declared and paid a per-share distribution from net realized gains to shareholders of record on December 20, 2021 of $0.2781 for the Investor Class, I Class, A Class, R Class, R6 Class and G Class.
On December 21, 2021, the fund declared and paid the following per-share distributions from net investment income to shareholders of record on December 20, 2021:
Investor Class | I Class | A Class | R Class | R6 Class | G Class | ||||||||||||
$0.1551 | $0.1750 | $0.1304 | $0.1056 | $0.1898 | $0.2790 |
The tax character of distributions paid during the years ended November 30, 2021 and November 30, 2020 were as follows:
2021 | 2020 | |||||||
Distributions Paid From | ||||||||
Ordinary income | $ | 13,057,585 | $ | 18,964,389 | ||||
Long-term capital gains | — | — |
The book-basis character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements.
As of period end, the federal tax cost of investments and the components of distributable earnings on a tax-basis were as follows:
Federal tax cost of investments | $ | 633,669,811 | |||
Gross tax appreciation of investments | $ | 68,185,917 | |||
Gross tax depreciation of investments | (51,728,579) | ||||
Net tax appreciation (depreciation) of investments | 16,457,338 | ||||
Net tax appreciation (depreciation) on translation of assets and liabilities in foreign currencies | (42,709) | ||||
Net tax appreciation (depreciation) | $ | 16,414,629 | |||
Undistributed ordinary income | $ | 35,877,939 |
The difference between book-basis and tax-basis unrealized appreciation (depreciation) is attributable primarily to the tax deferral of losses on wash sales.
21
Financial Highlights |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Operating Expenses (before expense waiver) | Net Investment Income (Loss) | Net Investment Income (Loss) (before expense waiver) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||||||
Investor Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $8.98 | 0.18 | 0.72 | 0.90 | (0.12) | — | (0.12) | $9.76 | 10.15% | 1.25% | 1.25% | 1.76% | 1.76% | 54% | $152,993 | ||||||||||||||||||||||||||||||||
2020 | $10.61 | 0.13 | (1.31) | (1.18) | (0.32) | (0.13) | (0.45) | $8.98 | (11.75)% | 1.31% | 1.31% | 1.60% | 1.60% | 68% | $107,655 | ||||||||||||||||||||||||||||||||
2019(3) | $10.00 | 0.31 | 0.34 | 0.65 | (0.04) | — | (0.04) | $10.61 | 6.59% | 1.31%(4) | 1.31%(4) | 3.04%(4) | 3.04%(4) | 85% | $101,934 | ||||||||||||||||||||||||||||||||
I Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $8.99 | 0.19 | 0.74 | 0.93 | (0.14) | — | (0.14) | $9.78 | 10.47% | 1.05% | 1.05% | 1.96% | 1.96% | 54% | $194 | ||||||||||||||||||||||||||||||||
2020(5) | $10.45 | 0.15 | (1.16) | (1.01) | (0.32) | (0.13) | (0.45) | $8.99 | (10.29)% | 1.11%(4) | 1.11%(4) | 1.80%(4) | 1.80%(4) | 68%(6) | $4 | ||||||||||||||||||||||||||||||||
A Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $8.96 | 0.16 | 0.71 | 0.87 | (0.10) | — | (0.10) | $9.73 | 9.89% | 1.50% | 1.50% | 1.51% | 1.51% | 54% | $13 | ||||||||||||||||||||||||||||||||
2020(5) | $10.45 | 0.11 | (1.15) | (1.04) | (0.32) | (0.13) | (0.45) | $8.96 | (10.62)% | 1.56%(4) | 1.56%(4) | 1.35%(4) | 1.35%(4) | 68%(6) | $4 | ||||||||||||||||||||||||||||||||
R Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $8.93 | 0.15 | 0.71 | 0.86 | (0.08) | — | (0.08) | $9.71 | 9.65% | 1.75% | 1.75% | 1.26% | 1.26% | 54% | $31 | ||||||||||||||||||||||||||||||||
2020(5) | $10.45 | 0.09 | (1.16) | (1.07) | (0.32) | (0.13) | (0.45) | $8.93 | (10.93)% | 1.81%(4) | 1.81%(4) | 1.10%(4) | 1.10%(4) | 68%(6) | $6 | ||||||||||||||||||||||||||||||||
R6 Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $9.14 | 0.22 | 0.73 | 0.95 | (0.15) | — | (0.15) | $9.94 | 10.57% | 0.90% | 0.90% | 2.11% | 2.11% | 54% | $5 | ||||||||||||||||||||||||||||||||
2020(5) | $10.60 | 0.16 | (1.16) | (1.00) | (0.33) | (0.13) | (0.46) | $9.14 | (10.12)% | 0.96%(4) | 0.96%(4) | 1.95%(4) | 1.95%(4) | 68%(6) | $4 |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Operating Expenses (before expense waiver) | Net Investment Income (Loss) | Net Investment Income (Loss) (before expense waiver) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||||||
G Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $9.11 | 0.31 | 0.72 | 1.03 | (0.24) | — | (0.24) | $9.90 | 11.56% | 0.00%(7) | 0.90% | 3.01% | 2.11% | 54% | $497,745 | ||||||||||||||||||||||||||||||||
2020 | $10.76 | 0.24 | (1.29) | (1.05) | (0.47) | (0.13) | (0.60) | $9.11 | (10.58)% | 0.01% | 0.96% | 2.90% | 1.95% | 68% | $463,081 | ||||||||||||||||||||||||||||||||
2019(3) | $10.00 | 0.43 | 0.37 | 0.80 | (0.04) | — | (0.04) | $10.76 | 8.00% | 0.01%(4) | 0.96%(4) | 4.34%(4) | 3.39%(4) | 85% | $264,529 |
Notes to Financial Highlights |
(1)Computed using average shares outstanding throughout the period.
(2)Total returns are calculated based on the net asset value of the last business day and do not reflect applicable sales charges, if any. Total returns for periods less than one year are not annualized.
(3)December 6, 2018 (fund inception) through November 30, 2019.
(4)Annualized.
(5)December 3, 2019 (commencement of sale) through November 30, 2020.
(6)Portfolio turnover is calculated at the fund level. Percentage indicated was calculated for the year ended November 30, 2020.
(7)Ratio was less than 0.005%.
See Notes to Financial Statements.
Report of Independent Registered Public Accounting Firm |
To the Shareholders and the Board of Directors of American Century World Mutual Funds, Inc.:
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Non-U.S. Intrinsic Value Fund (the “Fund”), one of the funds constituting the American Century World Mutual Funds, Inc., as of November 30, 2021, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for the years ended November 30, 2021, 2020 and for the period December 6, 2018 (fund inception) through November 30, 2019, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of Non-U.S. Intrinsic Value Fund of the American Century World Mutual Funds, Inc. as of November 30, 2021, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the years ended November 30, 2021, 2020 and for the period December 6, 2018 (fund inception) through November 30, 2019, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund’s financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. 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, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of November 30, 2021, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
/s/ Deloitte & Touche LLP
Kansas City, Missouri
January 19, 2022
We have served as the auditor of one or more American Century investment companies since 1997.
24
Management |
The Board of Directors
The individuals listed below serve as directors of the funds. Each director will continue to serve in this capacity until death, retirement, resignation or removal from office. The board has adopted a mandatory retirement age for directors who are not “interested persons,” as that term is defined in the Investment Company Act (independent directors). Independent directors shall retire by December 31 of the year in which they reach their 75th birthday.
Jonathan S. Thomas is an “interested person” because he currently serves as President and Chief Executive Officer of American Century Companies, Inc. (ACC), the parent company of American Century Investment Management, Inc. (ACIM or the advisor). The other directors (more than three-fourths of the total number) are independent. They are not employees, directors or officers of, and have no financial interest in, ACC or any of its wholly owned, direct or indirect, subsidiaries, including ACIM, American Century Investment Services, Inc. (ACIS) and American Century Services, LLC (ACS), and they do not have any other affiliations, positions or relationships that would cause them to be considered “interested persons” under the Investment Company Act. The directors serve in this capacity for seven (in the case of Jonathan S. Thomas, 16; and Stephen E. Yates, 8) registered investment companies in the American Century Investments family of funds.
The following table presents additional information about the directors. The mailing address for each director is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Thomas W. Bunn (1953) | Director | Since 2017 | Retired | 72 | SquareTwo Financial; Barings (formerly Babson Capital Funds Trust) (2013 to 2016) | ||||||||||||
Chris H. Cheesman (1962) | Director | Since 2019 | Retired. Senior Vice President & Chief Audit Executive, AllianceBernstein (1999 to 2018) | 72 | Alleghany Corporation | ||||||||||||
Barry Fink (1955) | Director | Since 2012 (independent since 2016) | Retired | 72 | None | ||||||||||||
Rajesh K. Gupta (1960) | Director | Since 2019 | Partner Emeritus, SeaCrest Investment Management and SeaCrest Wealth Management (2019 to Present); Chief Executive Officer and Chief Investment Officer, SeaCrest Investment Management (2006 to 2019); Chief Executive Officer and Chief Investment Officer, SeaCrest Wealth Management (2008 to 2019) | 72 | None |
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Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Lynn Jenkins (1963) | Director | Since 2019 | Consultant, LJ Strategies (2019 to present); United States Representative, U.S. House of Representatives (2009 to 2018) | 72 | MGP Ingredients, Inc. (2019 to 2021) | ||||||||||||
Jan M. Lewis (1957) | Director | Since 2011 | Retired | 72 | None | ||||||||||||
John R. Whitten(1) (1946) | Director | Since 2008 | Retired | 72 | Onto Innovation Inc. (2019 to 2020); Rudolph Technologies, Inc. (2006 to 2019) | ||||||||||||
Stephen E. Yates (1948) | Director and Chairman of the Board | Since 2012 (Chairman since 2018) | Retired | 108 | None | ||||||||||||
Interested Director | |||||||||||||||||
Jonathan S. Thomas (1963) | Director | Since 2007 | President and Chief Executive Officer, ACC (2007 to present). Also serves as Chief Executive Officer, ACS; Director, ACC and other ACC subsidiaries | 146 | None |
(1) Effective December 31, 2021, John R. Whitten retired from the Board of Directors.
The Statement of Additional Information has additional information about the fund's directors and is available without charge, upon request, by calling 1-800-345-2021.
26
Officers
The following table presents certain information about the executive officers of the funds. Each officer serves as an officer for each of the 16 (in the case of Robert J. Leach, 15) investment companies in the American Century family of funds. No officer is compensated for his or her service as an officer of the funds. The listed officers are interested persons of the funds and are appointed or re-appointed on an annual basis. The mailing address for each officer listed below is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Offices with the Funds | Principal Occupation(s) During the Past Five Years | ||||||
Patrick Bannigan (1965) | President since 2019 | Executive Vice President and Director, ACC (2012 to present); Chief Financial Officer, Chief Accounting Officer and Treasurer, ACC (2015 to present). Also serves as President, ACS; Vice President, ACIM; Chief Financial Officer, Chief Accounting Officer and/or Director, ACIM, ACS and other ACC subsidiaries | ||||||
R. Wes Campbell (1974) | Chief Financial Officer and Treasurer since 2018 | Vice President, ACS, (2020 to present); Investment Operations and Investment Accounting, ACS (2000 to present) | ||||||
Amy D. Shelton (1964) | Chief Compliance Officer and Vice President since 2014 | Chief Compliance Officer, American Century funds, (2014 to present); Chief Compliance Officer, ACIM (2014 to present); Chief Compliance Officer, ACIS (2009 to present). Also serves as Vice President, ACIS | ||||||
John Pak (1968) | General Counsel and Senior Vice President since 2021 | General Counsel and Senior Vice President, ACC (2021 to present). Also serves as General Counsel and Senior Vice President, ACIM, ACS and ACIS. Chief Legal Officer of Investment and Wealth Management, The Bank of New York Mellon (2014 to 2021) | ||||||
C. Jean Wade (1964) | Vice President since 2012 | Senior Vice President, ACS (2017 to present); Vice President, ACS (2000 to 2017) | ||||||
Robert J. Leach (1966) | Vice President since 2006 | Vice President, ACS (2000 to present) | ||||||
David H. Reinmiller (1963) | Vice President since 2000 | Attorney, ACC (1994 to present). Also serves as Vice President, ACIM and ACS | ||||||
Ward D. Stauffer (1960) | Secretary since 2005 | Attorney, ACC (2003 to present) |
27
Approval of Management Agreement |
At a meeting held on June 30, 2021, the Fund’s Board of Directors (the "Board") unanimously approved the renewal of the management agreement pursuant to which American Century Investment Management, Inc. (the “Advisor”) acts as the investment advisor for the Fund. Under Section 15(c) of the Investment Company Act, contracts for investment advisory services are required to be reviewed, evaluated, and approved by a majority of a fund’s directors (the “Directors”), including a majority of the independent Directors, each year.
Prior to its consideration of the renewal of the management agreement, the Directors requested and reviewed extensive data and information compiled by the Advisor and certain independent providers of evaluation data concerning the Fund and the services provided to the Fund by the Advisor. This review was in addition to the oversight and evaluation undertaken by the Board and its committees on a continual basis and the information received was supplemental to the extensive information that the Board and its committees receive and consider throughout the year.
In connection with its consideration of the renewal of the management agreement, the Board’s review and evaluation of the services provided by the Advisor and its affiliates included, but was not limited to, the following:
•the nature, extent, and quality of investment management, shareholder services, and other services provided and to be provided to the Fund including without limitation portfolio management and trading services, shareholder and intermediary services, compliance and legal services, fund accounting and financial reporting, and fund share distribution;
•the wide range of other programs and services provided and to be provided to the Fund and its shareholders on a routine and non-routine basis;
•the Fund’s investment performance, including data comparing the Fund's performance to appropriate benchmarks and/or a peer group of other mutual funds with similar investment objectives and strategies;
•the cost of owning the Fund compared to the cost of owning similar funds;
•the compliance policies, procedures, and regulatory experience of the Advisor and the Fund's service providers;
•the Advisor’s strategic plans, COVID-19 pandemic response, vendor management practices, and social justice initiatives;
•the Advisor’s business continuity plans and cyber security practices;
•financial data showing the cost of services provided to the Fund, the profitability of the Fund to the Advisor, and the overall profitability of the Advisor;
•possible economies of scale associated with the Advisor’s management of the Fund and other accounts;
•services provided and charges to the Advisor's other investment management clients;
•acquired fund fees and expenses;
•payments and practices in connection with financial intermediaries holding shares of the Fund and the services provided by intermediaries in connection therewith; and
•possible collateral benefits to the Advisor from the management of the Fund.
The Board held two meetings to consider the renewal. The independent Directors also met in private session three times to review and discuss the information provided in response to their request. The independent Directors held active discussions with the Advisor regarding the renewal of the management agreement, requesting supplemental information, and reviewing information provided by the Advisor in response thereto. The independent Directors had the benefit of the advice of their independent counsel throughout the process.
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Factors Considered
The Directors considered all of the information provided by the Advisor, the independent data providers, and independent counsel in connection with the approval. They determined that the information was sufficient for them to evaluate the management agreement for the Fund. In connection with their review, the Directors did not identify any single factor as being all-important or controlling, and each Director may have attributed different levels of importance to different factors. In deciding to renew the management agreement, the Board based its decision on a number of factors, including without limitation the following:
Nature, Extent and Quality of Services — Generally. Under the management agreement, the Advisor is responsible for providing or arranging for all services necessary for the operation of the Fund. The Board noted that the Advisor provides or arranges at its own expense a wide variety of services which include the following:
•constructing and designing the Fund
•portfolio research and security selection
•initial capitalization/funding
•securities trading
•Fund administration
•custody of Fund assets
•daily valuation of the Fund’s portfolio
•liquidity monitoring and management
•risk management, including cyber security
•shareholder servicing and transfer agency, including shareholder confirmations, recordkeeping, and communications
•legal services (except the independent Directors’ counsel)
•regulatory and portfolio compliance
•financial reporting
•marketing and distribution (except amounts paid by the Fund under Rule 12b-1 plans)
The Board noted that many of these services have expanded over time in terms of both quantity and complexity in response to shareholder demands, competition in the industry, changing distribution channels, and the changing regulatory environment.
Investment Management Services. The nature of the investment management services provided to the Fund is quite complex and allows Fund shareholders access to professional money management, instant diversification of their investments within an asset class, the opportunity to easily diversify among asset classes by investing in or exchanging among various American Century Investments funds, and liquidity. In evaluating investment performance, the Board expects the Advisor to manage the Fund in accordance with its investment objectives and approved strategies. Further, the Directors recognize that the Advisor has an obligation to monitor trading activities, and in particular to seek the best execution of fund trades, and to evaluate the use of and payment for research. In providing these services, the Advisor utilizes teams of investment professionals (portfolio managers, analysts, research assistants, and securities traders) who require extensive information technology, research, training, compliance, and other systems to conduct their business. The Board, directly and through its Fund Performance Review Committee, provides oversight of the investment performance process. It regularly reviews investment performance information for the Fund, together with comparative information for appropriate benchmarks and/or peer groups of similarly-managed funds, over different time horizons. The Directors also review investment performance information during the management agreement renewal process. If performance concerns are identified, the Fund receives special reviews until performance improves, during which the Board discusses with the Advisor the reasons for such results (e.g., market conditions, security selection) and any efforts being undertaken to improve performance. The Fund’s performance was below its benchmark for the one-year period reviewed by the Board. The Board found the investment management services provided by the Advisor to the Fund to be satisfactory and consistent with the management agreement.
29
Shareholder and Other Services. Under the management agreement, the Advisor provides the Fund with a comprehensive package of transfer agency, shareholder, and other services. The Board, directly and through its various committees, regularly reviews reports and evaluations of such services at its regular meetings. These reports include, but are not limited to, information regarding the operational efficiency and accuracy of the shareholder and transfer agency services provided, staffing levels, shareholder satisfaction, technology support (including cyber security), new products and services offered to Fund shareholders, securities trading activities, portfolio valuation services, auditing services, and legal and operational compliance activities. The Board found the services provided by the Advisor to the Fund under the management agreement to be competitive and of high quality.
Costs of Services and Profitability. The Advisor provides detailed information concerning its cost of providing various services to the Fund, its profitability in managing the Fund (pre- and post-distribution), its overall profitability, and its financial condition. The Directors have reviewed with the Advisor the methodology used to prepare this financial information. This information is considered in evaluating the Advisor’s financial condition, its ability to continue to provide services under the management agreement, and the reasonableness of the current management fee. The Board concluded that the Advisor’s profits were reasonable in light of the services provided to the Fund.
Ethics. The Board generally considers the Advisor’s commitment to providing quality services to shareholders and to conducting its business ethically. They noted that the Advisor’s practices generally meet or exceed industry best practices.
Economies of Scale. The Board also reviewed information provided by the Advisor regarding the possible existence of economies of scale in connection with the management of the Fund. The Board concluded that economies of scale are difficult to measure and predict with precision, especially on a fund-by-fund basis. The Board concluded that the Advisor is sharing economies of scale, to the extent they exist, through its competitive fee structure, offering competitive fees from fund inception, and through reinvestment in its business, infrastructure, investment capabilities and initiatives to provide shareholders additional content and services.
Comparison to Other Funds’ Fees. The management agreement provides that the Fund pays the Advisor a single, all-inclusive (or unified) management fee for providing all services necessary for the management and operation of the Fund, other than brokerage expenses, expenses attributable to short sales, taxes, interest, extraordinary expenses, fees and expenses of the Fund’s independent Directors (including their independent legal counsel), and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the Investment Company Act. Under the unified fee structure, the Advisor is responsible for providing all investment advisory, custody, audit, administrative, compliance, recordkeeping, marketing and shareholder services, or arranging and supervising third parties to provide such services. By contrast, most other funds are charged a variety of fees, including an investment advisory fee, a transfer agency fee, an administrative fee, distribution charges, and other expenses. Other than their investment advisory fees and any applicable Rule 12b-1 distribution fees, all other components of the total fees charged by these other funds may be increased without shareholder approval. The Board believes the unified fee structure is a benefit to Fund shareholders because it clearly discloses to shareholders the cost of owning Fund shares, and, since the unified fee cannot be increased without a vote of Fund shareholders, it shifts to the Advisor the risk of increased costs of operating the Fund and provides a direct incentive to minimize administrative inefficiencies. Part of the Board’s analysis of fee levels involves reviewing certain evaluative data compiled by an independent provider comparing the Fund’s unified fee to the total expense ratios of its peers. The unified fee charged to shareholders of the Fund was above the median of the total expense ratios of the Fund’s peer expense universe. In addition, the Board reviewed the Fund’s position relative to the narrower set of its expense group peers. The Board and the Advisor agreed to a permanent change to the Fund's fee schedule that should have the effect of lowering the Fund's annual unified management fee by approximately 0.15% (e.g., the Investor Class unified fee will be reduced from 1.30% to 1.15%), beginning August 1, 2021. The Board concluded that the management fee paid by the Fund to the Advisor under the management agreement is reasonable in light of the services provided to the Fund.
30
Comparison to Fees and Services Provided to Other Clients of the Advisor. The Board also requested and received information from the Advisor concerning the nature of the services, fees, costs, and profitability of its advisory services to advisory clients other than the Fund. They observed that these varying types of client accounts require different services and involve different regulatory and entrepreneurial risks than the management of the Fund. The Board analyzed this information and concluded that the fees charged and services provided to the Fund were reasonable by comparison.
Payments to Intermediaries. The Directors also requested and received a description of payments made to intermediaries by the Fund and the Advisor and services provided in response thereto. These payments include various payments made by the Fund or the Advisor to different types of intermediaries and recordkeepers for distribution and service activities provided for the Fund. The Directors reviewed such information and received representations from the Advisor that all such payments by the Fund were made pursuant to the Fund's Rule 12b-1 Plan and that all such payments by the Advisor were made from the Advisor’s resources and reasonable profits. The Board found such payments to be reasonable in scope and purpose.
Collateral or “Fall-Out” Benefits Derived by the Advisor. The Board considered the possible existence of collateral benefits the Advisor may receive as a result of its relationship with the Fund. They concluded that the Advisor’s primary business is managing funds and it generally does not use fund or shareholder information to generate profits in other lines of business, and therefore does not derive any significant collateral benefits from them. To the extent there are potential collateral benefits, the Board has been advised and has taken this into consideration in its review of the management contract with the Fund. The Board noted that additional assets from other clients may offer the Advisor some benefit from increased leverage with service providers and counterparties. Additionally, the Advisor may receive proprietary research from broker-dealers that execute fund portfolio transactions, which the Board concluded is likely to benefit other clients of the Advisor, as well as Fund shareholders. The Board also determined that the Advisor is able to provide investment management services to certain clients other than the Fund, at least in part, due to its existing infrastructure built to serve the fund complex. The Board concluded that appropriate allocation methodologies had been employed to assign resources and the cost of those resources to these other clients.
Existing Relationship. The Board also considered whether there was any reason for not continuing the existing arrangement with the Advisor. In this regard, the Board was mindful of the potential disruptions of the Fund’s operations and various risks, uncertainties, and other effects that could occur as a result of a decision not to continue such relationship. In particular, the Board recognized that most shareholders have invested in the Fund on the strength of the Advisor’s industry standing and reputation and in the expectation that the Advisor will have a continuing role in providing advisory services to the Fund.
Conclusion of the Directors. As a result of this process, the Board, including all of the independent Directors, taking into account all of the factors discussed above and the information provided by the Advisor and others in connection with its review and throughout the year, determined that the management fee is fair and reasonable in light of the services provided and that the investment management agreement between the Fund and the Advisor should be renewed.
31
Additional Information |
Retirement Account Information
As required by law, distributions you receive from certain retirement accounts are subject to federal income tax withholding, unless you elect not to have withholding apply*. Tax will be withheld on the total amount withdrawn even though you may be receiving amounts that are not subject to withholding, such as nondeductible contributions. In such case, excess amounts of withholding could occur. You may adjust your withholding election so that a greater or lesser amount will be withheld.
If you don’t want us to withhold on this amount, you must notify us to not withhold the federal income tax. You may notify us in writing or in certain situations by telephone or through other electronic means. For systematic withdrawals, your withholding election will remain in effect until revoked or changed by filing a new election. You have the right to revoke your election at any time and change your withholding percentage for future distributions.
Remember, even if you elect not to have income tax withheld, you are liable for paying income tax on the taxable portion of your withdrawal. If you elect not to have income tax withheld or you don’t have enough income tax withheld, you may be responsible for payment of estimated tax. You may incur penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. You can reduce or defer the income tax on a distribution by directly or indirectly rolling such distribution over to another IRA or eligible plan. You should consult your tax advisor for additional information.
State tax will be withheld if, at the time of your distribution, your address is within one of the mandatory withholding states and you have federal income tax withheld (or as otherwise required by state law). State taxes will be withheld from your distribution in accordance with the respective state rules.
*Some 403(b), 457 and qualified retirement plan distributions may be subject to 20% mandatory withholding, as they are subject to special tax and withholding rules. Your plan administrator or plan sponsor is required to provide you with a special tax notice explaining those rules at the time you request a distribution. If applicable, federal and/or state taxes may be withheld from your distribution amount.
Proxy Voting Policies
A description of the policies that the fund's investment advisor uses in exercising the voting rights associated with the securities purchased and/or held by the fund is available without charge, upon request, by calling 1-800-345-2021. It is also available on American Century Investments’ website at americancentury.com/proxy and on the Securities and Exchange Commission’s website at sec.gov. Information regarding how the investment advisor voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on americancentury.com/proxy. It is also available at sec.gov.
Quarterly Portfolio Disclosure
The fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. These portfolio holdings are available on the fund's website at americancentury.com and, upon request, by calling 1-800-345-2021. The fund’s Form N-PORT reports are available on the SEC’s website at sec.gov.
32
Other Tax Information
The following information is provided pursuant to provisions of the Internal Revenue Code.
The fund hereby designates up to the maximum amount allowable as qualified dividend income for the fiscal year ended November 30, 2021.
For the fiscal year ended November 30, 2021, the fund intends to pass through to shareholders foreign source income of $21,798,028 and foreign taxes paid of $2,218,113, or up to the maximum amount allowable, as a foreign tax credit. Foreign source income and foreign tax expense per outstanding share on November 30, 2021 are $0.3303 and $0.0336, respectively.
33
Notes |
34
Notes |
35
Notes |
36
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Contact Us | americancentury.com | |||||||
Automated Information Line | 1-800-345-8765 | |||||||
Investor Services Representative | 1-800-345-2021 or 816-531-5575 | |||||||
Investors Using Advisors | 1-800-378-9878 | |||||||
Business, Not-For-Profit, Employer-Sponsored Retirement Plans | 1-800-345-3533 | |||||||
Banks and Trust Companies, Broker-Dealers, Financial Professionals, Insurance Companies | 1-800-345-6488 | |||||||
Telecommunications Relay Service for the Deaf | 711 | |||||||
American Century World Mutual Funds, Inc. | ||||||||
Investment Advisor: American Century Investment Management, Inc. Kansas City, Missouri | ||||||||
This report and the statements it contains are submitted for the general information of our shareholders. The report is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. | ||||||||
©2022 American Century Proprietary Holdings, Inc. All rights reserved. CL-ANN-95207 2201 |
![image37.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image37.jpg)
Annual Report | |||||
November 30, 2021 | |||||
NT Emerging Markets Fund | |||||
G Class (ACLKX) |
Table of Contents |
Performance | |||||
Portfolio Commentary | |||||
Fund Characteristics | |||||
Shareholder Fee Example | |||||
Schedule of Investments | |||||
Statement of Assets and Liabilities | |||||
Statement of Operations | |||||
Statement of Changes in Net Assets | |||||
Notes to Financial Statements | |||||
Financial Highlights | |||||
Report of Independent Registered Public Accounting Firm | |||||
Management | |||||
Approval of Management Agreement | |||||
Additional Information |
Any opinions expressed in this report reflect those of the author as of the date of the report, and do not necessarily represent the opinions of American Century Investments® or any other person in the American Century Investments organization. Any such opinions are subject to change at any time based upon market or other conditions and American Century Investments disclaims any responsibility to update such opinions. These opinions may not be relied upon as investment advice and, because investment decisions made by American Century Investments funds are based on numerous factors, may not be relied upon as an indication of trading intent on behalf of any American Century Investments fund. Security examples are used for representational purposes only and are not intended as recommendations to purchase or sell securities. Performance information for comparative indices and securities is provided to American Century Investments by third party vendors. To the best of American Century Investments’ knowledge, such information is accurate at the time of printing.
Performance |
Total Returns as of November 30, 2021 | |||||||||||||||||
Average Annual Returns | |||||||||||||||||
Ticker Symbol | 1 year | 5 years | 10 years | Inception Date | |||||||||||||
G Class | ACLKX | 2.06% | 11.99% | 7.46% | 5/12/06 | ||||||||||||
MSCI Emerging Markets Index | — | 2.70% | 9.51% | 5.16% | — |
Fund returns would have been lower if a portion of the fees had not been waived.
Growth of $10,000 Over 10 Years | ||
$10,000 investment made November 30, 2011 | ||
![chart-f18ca10720924c3bbfb.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/chart-f18ca10720924c3bbfb.jpg)
Value on November 30, 2021 | |||||
G Class — $20,547 | |||||
MSCI Emerging Markets Index — $16,546 | |||||
Ending value of G Class would have been lower if a portion of the fees had not been waived.
Total Annual Fund Operating Expenses | |||||
G Class | 0.92% |
The total annual fund operating expenses shown is as stated in the fund’s prospectus current as of the date of this report. The prospectus may vary from the expense ratio shown elsewhere in this report because it is based on a different time period, includes acquired fund fees and expenses, and, if applicable, does not include fee waivers or expense reimbursements.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
2
Portfolio Commentary |
Portfolio Managers: Patricia Ribeiro and Sherwin Soo
Performance Summary
NT Emerging Markets returned 2.06%* for the 12 months ended November 30, 2021. The fund’s benchmark, the MSCI Emerging Markets Index, returned 2.70% for the same period.
The fund underperformed its benchmark during the period, during which emerging markets faced several significant challenges, including regulatory pressure on Chinese growth stocks, the damage from COVID-19 variants and persistent inflationary pressures. The shifting inflation narrative, which supported cyclical sectors and drove value stocks to outperform growth, weighed on our positioning. The sharp (and continuous) rise in value was challenging for our investment approach as a growth manager. From a sector perspective, a combination of an underweight, relative to the benchmark, for most of the year in energy was a key driver of underperformance following the spike in energy prices. Stock selection in consumer staples also detracted, along with selection and an underweight in utilities. Conversely, stock selection in financials and health care added value during the period, along with an overweight to and stock choices in materials. Regionally, stock selection in India and Brazil were key drivers of relative underperformance, while stock choices in Taiwan and an underweight to China aided relative returns.
Energy and Consumer Staples Drive Underperformance
Lack of exposure to several index constituents in the oil, gas and consumable fuels industry was a key driver of the fund’s underperformance over the 12-month period, as the shares rose along with energy and oil prices. An off-benchmark position within the industry, independent oil and gas company Petro Rio, also weighed on relative performance.
In the consumer staples sector, food and staples retailing holdings drove relative detraction, including Turkish retailer BIM Birlesik Magazalar and Brazil-based drugstore chain Raia Drogasil. Food products company Nestle India also detracted. Birlesik Magazalar’s shares declined amid a combination of headlines regarding draft legislation on retail chains and increased country and currency risks. Increasing competition from well-capitalized peers weighed on Raia Drogasil, and we exited the position on concerns surrounding margin pressure. We also sold Nestle India as margin expansion was constrained by increased staffing costs.
Notable individual detractors included electronic components supplier Luxshare Precision Industry, Chinese education providers New Oriental Education & Technology Group and TAL Education Group, developer CIFI Holdings Group and data center operator GDS Holdings. Luxshare, the primary assembler of Apple’s AirPods, declined as sales growth of iPhones and AirPods slowed, and we exited the position as the new AirPods launch remained uncertain and shipment forecasts were lowered to factor in weaker-than-expected demand. New Oriental and TAL Education’s weakness was triggered by a regulatory crackdown on the after-school tutoring industry, which forced a nonprofit conversion and banned foreign capital for academic tutoring, and we sold off both positions. CIFI’s shares declined as margin compression remained an overhang for property companies in China, while land prices remained high. GDS’ shares weakened due to increasing concerns about the changing regulatory environment in China and the potential disruption to the company’s ability to grow earnings.
Financials and Health Care Led Contributors
Leasing firm Chailease Holding was responsible for the majority of contribution from the financials sector. The leasing firm’s recent results highlighted better operating efficiency, higher loan growth and lower credit costs. The rapid expansion in Chailease’s China leasing business has helped the company diversify its earnings streams. Given strong momentum, we believe Chailease will likely see continued portfolio growth in mainland China and Taiwan. Furthermore, vaccination progress
continued to support growth momentum in other key markets, such as Thailand and Malaysia. Bank stocks also supported relative returns, particularly OTP Bank and Al Rajhi Bank. Hungary-
*Fund returns would have been lower if a portion of the fees had not been waived.
3
based OTP’s shares rose with better-than-expected results that highlighted positive catalysts such as upside to consensus on stronger loan growth and better-than-expected cost of risk. Al Rajhi, the world’s largest Islamic bank, benefited from steady growth in its mortgage portfolio, which drove loan book growth.
In health care, a lack of exposure to several index constituents in the biotechnology and health care equipment and supplies industries bolstered returns, but the strongest individual contributor was Wuxi Biologics Cayman. The biologics research and development services provider benefited from strong business momentum and higher growth guidance, reflecting global outsourcing trends. Wuxi raised revenue forecasts based on stronger-than-expected growth for COVID-19 antibody and vaccine projects and non-COVID-19 projects. Demand for biological drugs in China is growing much faster than the global market, and Wuxi’s ability to serve multiple COVID-19 players adopting different technologies will likely drive recurring demand growth.
Elsewhere, key individual contributors included Contemporary Amperex Technology Co. (CATL), ASPEED Technology and Ganfeng Lithium. CATL, the world’s largest electric vehicle (EV) battery maker, is supported by technology and cost advantages. CATL’s June agreement to supply EV battery packs to Tesla provides longer order visibility. We believe CATL will likely continue to see global market share growth, driven by overseas expansion. Shares of integrated circuit design firm ASPEED were supported by its exposure to cloud servers amid continuing growth in cloud services and data center demand. The company’s capital spending expansion will likely drive sustainable future growth, in our view. Ganfeng’s shares advanced along with rising lithium prices, driven by a persistent rise in demand, the key driver of the company’s growth prospects. The lithium market has tightened as EV adoption and battery installation accelerates, supported by global commitments to decarbonization, and Ganfeng plans to further ramp up its production capacity and output.
Outlook
We remain constructive on emerging markets (EM) equities based on consistent progress against COVID-19. EM continues to lag behind developed markets on vaccinations; however, repeat waves and variants will likely be less economically disruptive with increased access to vaccinations and therapeutics. In addition, China will likely prioritize growth and stability in 2022 rather than regulatory tightening. Additional catalysts for 2022 include the restoration of EM’s growth premium to developed markets. These points, coupled with attractive valuations, support our constructive view.
Improving vaccination and caseload data continues to boost the outlook for EM, despite variants, in our view. Vaccine rates have improved across EM, notably in major markets such as Brazil and India. Increased vaccine supply and faster rollout should continue to reduce new case and hospitalization levels, spurring economic activity as economies more fully reopen.
Secular trends and the ongoing economic recovery continue to support information technology, consumer positioning and cyclicals. Digitalization, cloud-based computing and the shift to online continue to support technology, while the removal of mobility restrictions and economic reopening are benefiting select consumer-facing names and cyclicals.
China remains a prominent position in the portfolio. Chinese equity indices were among the worst performing in EM in 2021, owing to the normalization of pandemic policy and government crackdowns, including property developer leverage limits, antitrust regulation over leading internet platforms and a directional change for the after-school education sector. Nonetheless, signs of policy easing have begun to appear, and while further policy changes are possible as China pursues its long-term development and modernization agenda, we believe the most stringent changes may be behind us. Given an improving earnings outlook and improved valuations, consensus expectations for China have improved, significantly in some cases. We continue to invest in sectors with policy tailwinds, including green initiatives such as electric vehicles and renewable energy and their respective value chains, as well as the increasing reliance on technology.
Regional and sector differences continue. Recovery rates remain staggered across EM, depending upon each region’s success in dealing with COVID-19. We believe growth momentum will likely improve in those economies that continue to emerge from the pandemic. In our view, China will likely perform better in 2022 as the regulatory environment improves. Meanwhile, EM countries outside of North Asia, such as Europe, the Middle East and Africa (EMEA) and Latin America, where recovery data are not fully factored in, may have more room to recover.
4
Fund Characteristics |
NOVEMBER 30, 2021 | |||||
Types of Investments in Portfolio | % of net assets | ||||
Common Stocks | 97.6% | ||||
Rights | —* | ||||
Temporary Cash Investments | 2.2% | ||||
Other Assets and Liabilities | 0.2% | ||||
*Category is less than 0.05% of total net assets. | |||||
Top Five Countries | % of net assets | ||||
China | 30.1% | ||||
Taiwan | 16.5% | ||||
South Korea | 14.6% | ||||
India | 10.6% | ||||
Russia | 6.4% |
5
Shareholder Fee Example |
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption/exchange fees; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in your fund and to compare these costs with the ongoing cost of investing in other mutual funds.
The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period from May 29, 2021 to November 30, 2021.
Actual Expenses
The table provides information about actual account values and actual expenses for each class. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. First, identify the share class you own. Then simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The table also provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each class of your fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of a fund’s share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption/exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Beginning Account Value 5/29/21 | Ending Account Value 11/30/21 | Expenses Paid During Period(1) 5/29/21 - 11/30/21 | Annualized Expense Ratio(1) | |||||||||||
Actual | ||||||||||||||
G Class | $1,000 | $902.10 | $0.00 | 0.00%(2) | ||||||||||
Hypothetical | ||||||||||||||
G Class | $1,000 | $1,025.48 | $0.00 | 0.00%(2) |
(1)Expenses are equal to the class's annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 186, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. Annualized expense ratio reflects actual expenses, including any applicable fee waivers or expense reimbursements and excluding any acquired fund fees and expenses.
(2)Other expenses, which include directors' fees and expenses, did not exceed 0.005%.
6
Schedule of Investments |
NOVEMBER 30, 2021
Shares | Value | |||||||
COMMON STOCKS — 97.6% | ||||||||
Brazil — 3.5% | ||||||||
Banco BTG Pactual SA | 1,191,700 | $ | 4,428,189 | |||||
Embraer SA, ADR(1) | 526,630 | 7,230,630 | ||||||
Petro Rio SA(1) | 1,463,500 | 5,229,900 | ||||||
Suzano SA(1) | 433,100 | 4,344,212 | ||||||
Vibra Energia SA | 738,100 | 2,855,586 | ||||||
WEG SA | 866,200 | 4,959,751 | ||||||
29,048,268 | ||||||||
China — 30.1% | ||||||||
Alibaba Group Holding Ltd., ADR(1) | 183,575 | 23,411,320 | ||||||
BYD Co. Ltd., H Shares | 447,000 | 17,582,110 | ||||||
China Construction Bank Corp., H Shares | 14,500,000 | 9,448,288 | ||||||
China Education Group Holdings Ltd. | 2,421,000 | 4,453,495 | ||||||
China Tourism Group Duty Free Corp. Ltd., A Shares | 258,087 | 8,339,451 | ||||||
Chinasoft International Ltd.(1) | 4,944,000 | 8,220,263 | ||||||
CIFI Holdings Group Co. Ltd. | 10,345,557 | 5,624,374 | ||||||
Contemporary Amperex Technology Co. Ltd., A Shares | 186,798 | 19,939,731 | ||||||
Country Garden Services Holdings Co. Ltd. | 1,221,000 | 7,402,504 | ||||||
ENN Energy Holdings Ltd. | 133,200 | 2,493,923 | ||||||
Ganfeng Lithium Co. Ltd., H Shares(2) | 786,600 | 15,202,863 | ||||||
GDS Holdings Ltd., ADR(1) | 79,643 | 4,463,194 | ||||||
Huazhu Group Ltd., ADR(1) | 43,769 | 1,729,751 | ||||||
Industrial & Commercial Bank of China Ltd., H Shares | 6,173,095 | 3,262,067 | ||||||
Kweichow Moutai Co. Ltd., A Shares | 25,900 | 7,855,241 | ||||||
Li Ning Co. Ltd. | 1,028,500 | 11,632,941 | ||||||
Meituan, Class B(1) | 373,900 | 11,364,425 | ||||||
Nine Dragons Paper Holdings Ltd. | 2,910,000 | 3,245,932 | ||||||
NIO, Inc., ADR(1) | 203,308 | 7,955,442 | ||||||
Ping An Insurance Group Co. of China Ltd., H Shares | 617,000 | 4,277,193 | ||||||
Shenzhou International Group Holdings Ltd. | 564,800 | 10,605,727 | ||||||
Tencent Holdings Ltd. | 697,900 | 40,700,870 | ||||||
Wuxi Biologics Cayman, Inc.(1) | 1,130,000 | 15,243,455 | ||||||
Yantai Jereh Oilfield Services Group Co. Ltd., A Shares | 1,324,700 | 8,091,110 | ||||||
252,545,670 | ||||||||
Hungary — 1.5% | ||||||||
OTP Bank Nyrt(1) | 232,146 | 12,818,224 | ||||||
India — 10.6% | ||||||||
Asian Paints Ltd. | 117,276 | 4,907,572 | ||||||
Bajaj Finance Ltd. | 92,333 | 8,600,612 | ||||||
Bata India Ltd. | 170,708 | 4,269,363 | ||||||
HDFC Bank Ltd. | 918,483 | 18,195,910 | ||||||
ICICI Bank Ltd., ADR | 771,999 | 14,251,102 | ||||||
Infosys Ltd., ADR | 566,251 | 12,785,948 | ||||||
Jubilant Foodworks Ltd. | 184,066 | 8,962,065 | ||||||
Tata Consultancy Services Ltd. | 179,852 | 8,452,545 | ||||||
UltraTech Cement Ltd. | 85,949 | 8,487,910 | ||||||
88,913,027 |
7
Shares | Value | |||||||
Indonesia — 1.7% | ||||||||
Bank Rakyat Indonesia Persero Tbk PT | 45,897,400 | $ | 13,077,868 | |||||
Bukalapak.com Tbk PT(1) | 31,812,900 | 1,210,541 | ||||||
14,288,409 | ||||||||
Luxembourg — 0.7% | ||||||||
Ternium SA, ADR | 161,231 | 6,157,412 | ||||||
Malaysia — 0.3% | ||||||||
CIMB Group Holdings Bhd | 2,087,000 | 2,564,296 | ||||||
Mexico — 2.5% | ||||||||
Cemex SAB de CV, ADR(1) | 1,059,851 | 6,518,084 | ||||||
Grupo Financiero Banorte SAB de CV | 1,576,923 | 9,394,247 | ||||||
Wal-Mart de Mexico SAB de CV | 1,589,156 | 4,995,178 | ||||||
20,907,509 | ||||||||
Netherlands — 0.7% | ||||||||
Prosus NV(1) | 69,481 | 5,602,424 | ||||||
Philippines — 0.8% | ||||||||
Ayala Land, Inc. | 10,239,080 | 6,996,307 | ||||||
Russia — 6.4% | ||||||||
Magnit PJSC | 59,103 | 4,626,880 | ||||||
Novatek PJSC, GDR | 54,593 | 11,909,474 | ||||||
Sberbank of Russia PJSC, ADR (London) | 689,117 | 11,612,696 | ||||||
TCS Group Holding plc, GDR | 136,757 | 13,043,348 | ||||||
Yandex NV, A Shares(1) | 176,482 | 12,696,115 | ||||||
53,888,513 | ||||||||
Saudi Arabia — 1.6% | ||||||||
Al Rajhi Bank | 391,040 | 13,739,596 | ||||||
Singapore — 0.8% | ||||||||
Sea Ltd., ADR(1) | 24,185 | 6,966,973 | ||||||
South Africa — 1.6% | ||||||||
Capitec Bank Holdings Ltd. | 72,961 | 8,372,264 | ||||||
Naspers Ltd., N Shares | 34,448 | 5,276,275 | ||||||
13,648,539 | ||||||||
South Korea — 14.6% | ||||||||
CJ Logistics Corp.(1) | 33,502 | 3,495,241 | ||||||
Cosmax, Inc.(1) | 35,464 | 2,696,849 | ||||||
Ecopro BM Co. Ltd. | 25,110 | 11,479,299 | ||||||
Hyundai Motor Co. | 33,687 | 5,534,236 | ||||||
Iljin Materials Co. Ltd. | 22,610 | 2,437,070 | ||||||
Mando Corp.(1) | 95,497 | 4,390,117 | ||||||
NAVER Corp. | 37,423 | 11,947,366 | ||||||
Samsung Biologics Co. Ltd.(1) | 14,731 | 11,043,373 | ||||||
Samsung Electro-Mechanics Co. Ltd. | 68,823 | 9,637,730 | ||||||
Samsung Electronics Co. Ltd. | 623,396 | 37,420,098 | ||||||
Samsung SDI Co. Ltd. | 20,276 | 11,715,510 | ||||||
SK Hynix, Inc. | 109,624 | 10,480,172 | ||||||
122,277,061 | ||||||||
Taiwan — 16.5% | ||||||||
ASPEED Technology, Inc. | 82,000 | 9,889,259 | ||||||
Chailease Holding Co. Ltd. | 2,561,209 | 22,659,030 | ||||||
Formosa Plastics Corp. | 2,123,000 | 7,786,567 | ||||||
MediaTek, Inc. | 347,000 | 12,578,967 | ||||||
Merida Industry Co. Ltd. | 477,000 | 5,122,588 |
8
Shares | Value | |||||||
President Chain Store Corp. | 358,000 | $ | 3,464,285 | |||||
Taiwan Semiconductor Manufacturing Co. Ltd. | 3,438,774 | 73,138,171 | ||||||
Win Semiconductors Corp. | 325,000 | 4,227,636 | ||||||
138,866,503 | ||||||||
Thailand — 3.0% | ||||||||
CP ALL PCL | 2,552,800 | 4,477,363 | ||||||
Kasikornbank PCL | 2,480,000 | 9,705,146 | ||||||
PTT Exploration & Production PCL | 3,133,800 | 10,493,609 | ||||||
24,676,118 | ||||||||
Turkey — 0.4% | ||||||||
BIM Birlesik Magazalar AS | 574,091 | 2,922,436 | ||||||
United States — 0.3% | ||||||||
MercadoLibre, Inc.(1) | 2,261 | 2,686,995 | ||||||
TOTAL COMMON STOCKS (Cost $638,706,021) | 819,514,280 | |||||||
RIGHTS† | ||||||||
China† | ||||||||
CIFI Holdings Group Co. Ltd.(1) | 517,277 | 16,584 | ||||||
Thailand† | ||||||||
CP ALL PCL(1) | 170,187 | 1,717 | ||||||
TOTAL RIGHTS (Cost $—) | 18,301 | |||||||
TEMPORARY CASH INVESTMENTS — 2.2% | ||||||||
Repurchase Agreement, BMO Capital Markets Corp., (collateralized by various U.S. Treasury obligations, 0.125% - 2.625%, 6/30/22 - 5/15/51, valued at $4,096,486), in a joint trading account at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $4,010,582) | 4,010,580 | |||||||
Repurchase Agreement, Fixed Income Clearing Corp., (collateralized by various U.S. Treasury obligations, 1.00%, 7/31/28, valued at $13,645,622), at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $13,378,007) | 13,378,000 | |||||||
State Street Institutional U.S. Government Money Market Fund, Premier Class | 866,136 | 866,136 | ||||||
TOTAL TEMPORARY CASH INVESTMENTS (Cost $18,254,716) | 18,254,716 | |||||||
TOTAL INVESTMENT SECURITIES — 99.8% (Cost $656,960,737) | 837,787,297 | |||||||
OTHER ASSETS AND LIABILITIES — 0.2% | 2,036,747 | |||||||
TOTAL NET ASSETS — 100.0% | $ | 839,824,044 |
MARKET SECTOR DIVERSIFICATION | |||||
(as a % of net assets) | |||||
Information Technology | 24.5% | ||||
Financials | 21.4% | ||||
Consumer Discretionary | 17.1% | ||||
Communication Services | 8.5% | ||||
Materials | 6.7% | ||||
Industrials | 5.7% | ||||
Energy | 4.3% | ||||
Consumer Staples | 3.6% | ||||
Health Care | 3.1% | ||||
Real Estate | 2.4% | ||||
Utilities | 0.3% | ||||
Temporary Cash Investments | 2.2% | ||||
Other Assets and Liabilities | 0.2% |
9
NOTES TO SCHEDULE OF INVESTMENTS | ||||||||
ADR | - | American Depositary Receipt | ||||||
GDR | - | Global Depositary Receipt |
†Category is less than 0.05% of total net assets.
(1)Non-income producing.
(2)Security, or a portion thereof, is on loan. At the period end, the aggregate value of securities on loan was $4,514,125. The amount of securities on loan indicated may not correspond with the securities on loan identified because securities with pending sales are in the process of recall from the brokers. At the period end, the aggregate value of the collateral held by the fund was $4,949,408, all of which is securities collateral.
See Notes to Financial Statements.
10
Statement of Assets and Liabilities |
NOVEMBER 30, 2021 | |||||
Assets | |||||
Investment securities, at value (cost of $656,960,737) — including $4,514,125 of securities on loan | $ | 837,787,297 | |||
Receivable for investments sold | 6,280,852 | ||||
Receivable for capital shares sold | 4,071,335 | ||||
Dividends and interest receivable | 302,578 | ||||
Securities lending receivable | 4,479 | ||||
Other assets | 12,854 | ||||
848,459,395 | |||||
Liabilities | |||||
Payable for investments purchased | 7,042,419 | ||||
Payable for capital shares redeemed | 96 | ||||
Accrued foreign taxes | 1,592,836 | ||||
8,635,351 | |||||
Net Assets | $ | 839,824,044 | |||
G Class Capital Shares, $0.01 Par Value | |||||
Shares authorized | 510,000,000 | ||||
Shares outstanding | 59,958,998 | ||||
Net Asset Value Per Share | $ | 14.01 | |||
Net Assets Consist of: | |||||
Capital (par value and paid-in surplus) | $ | 624,142,576 | |||
Distributable earnings | 215,681,468 | ||||
$ | 839,824,044 |
See Notes to Financial Statements.
11
Statement of Operations |
YEAR ENDED NOVEMBER 30, 2021 | |||||
Investment Income (Loss) | |||||
Income: | |||||
Dividends (net of foreign taxes withheld of $1,626,090) | $ | 13,287,459 | |||
Securities lending, net | 66,959 | ||||
Interest (net of foreign taxes withheld of $19) | 1,860 | ||||
13,356,278 | |||||
Expenses: | |||||
Management fees | 7,408,223 | ||||
Directors' fees and expenses | 20,750 | ||||
Other expenses | 66,986 | ||||
7,495,959 | |||||
Fees waived | (7,408,223) | ||||
87,736 | |||||
Net investment income (loss) | 13,268,542 | ||||
Realized and Unrealized Gain (Loss) | |||||
Net realized gain (loss) on: | |||||
Investment transactions (net of foreign tax expenses paid (refunded) of $72,878) | 49,111,023 | ||||
Foreign currency translation transactions | (821,046) | ||||
48,289,977 | |||||
Change in net unrealized appreciation (depreciation) on: | |||||
Investments (includes (increase) decrease in accrued foreign taxes of $(607,056)) | (49,805,704) | ||||
Translation of assets and liabilities in foreign currencies | (20,706) | ||||
(49,826,410) | |||||
Net realized and unrealized gain (loss) | (1,536,433) | ||||
Net Increase (Decrease) in Net Assets Resulting from Operations | $ | 11,732,109 |
See Notes to Financial Statements.
12
Statement of Changes in Net Assets |
YEARS ENDED NOVEMBER 30, 2021 AND NOVEMBER 30, 2020 | ||||||||
Increase (Decrease) in Net Assets | November 30, 2021 | November 30, 2020 | ||||||
Operations | ||||||||
Net investment income (loss) | $ | 13,268,542 | $ | 7,314,453 | ||||
Net realized gain (loss) | 48,289,977 | 5,064,654 | ||||||
Change in net unrealized appreciation (depreciation) | (49,826,410) | 117,285,476 | ||||||
Net increase (decrease) in net assets resulting from operations | 11,732,109 | 129,664,583 | ||||||
Distributions to Shareholders | ||||||||
From earnings | (13,098,155) | (12,202,414) | ||||||
Capital Share Transactions | ||||||||
Proceeds from shares sold | 243,252,542 | 344,526,986 | ||||||
Proceeds from reinvestment of distributions | 13,098,155 | 12,202,414 | ||||||
Payments for shares redeemed | (145,909,133) | (175,438,606) | ||||||
Net increase (decrease) in net assets from capital share transactions | 110,441,564 | 181,290,794 | ||||||
Net increase (decrease) in net assets | 109,075,518 | 298,752,963 | ||||||
Net Assets | ||||||||
Beginning of period | 730,748,526 | 431,995,563 | ||||||
End of period | $ | 839,824,044 | $ | 730,748,526 | ||||
Transactions in Shares of the Fund | ||||||||
Sold | 16,140,190 | 27,860,321 | ||||||
Issued in reinvestment of distributions | 911,493 | 1,032,353 | ||||||
Redeemed | (9,382,498) | (14,097,357) | ||||||
Net increase (decrease) in shares of the fund | 7,669,185 | 14,795,317 |
See Notes to Financial Statements.
13
Notes to Financial Statements |
NOVEMBER 30, 2021
1. Organization
American Century World Mutual Funds, Inc. (the corporation) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company and is organized as a Maryland corporation. NT Emerging Markets Fund (the fund) is one fund in a series issued by the corporation. The fund’s investment objective is to seek capital growth. The fund offers the G Class.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently followed by the fund in preparation of its financial statements. The fund is an investment company and follows accounting and reporting guidance in accordance with accounting principles generally accepted in the United States of America. This may require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from these estimates. Management evaluated the impact of events or transactions occurring through the date the financial statements were issued that would merit recognition or disclosure.
Investment Valuations — The fund determines the fair value of its investments and computes its net asset value (NAV) per share at the close of regular trading (usually 4 p.m. Eastern time) on the New York Stock Exchange (NYSE) on each day the NYSE is open. The Board of Directors has adopted valuation policies and procedures to guide the investment advisor in the fund’s investment valuation process and to provide methodologies for the oversight of the fund’s pricing function.
Equity securities that are listed or traded on a domestic securities exchange are valued at the last reported sales price or at the official closing price as provided by the exchange. Equity securities traded on foreign securities exchanges are generally valued at the closing price of such securities on the exchange where primarily traded or at the close of the NYSE, if that is earlier. If no last sales price is reported, or if local convention or regulation so provides, the mean of the latest bid and asked prices may be used. Securities traded over-the-counter are valued at the mean of the latest bid and asked prices, the last sales price, or the official closing price. Equity securities initially expressed in local currencies are translated into U.S. dollars at the mean of the appropriate currency exchange rate at the close of the NYSE as provided by an independent pricing service.
Open-end management investment companies are valued at the reported NAV per share. Repurchase agreements are valued at cost, which approximates fair value.
If the fund determines that the market price for an investment is not readily available or the valuation methods mentioned above do not reflect an investment’s fair value, such investment is valued as determined in good faith by the Board of Directors or its delegate, in accordance with policies and procedures adopted by the Board of Directors. In its determination of fair value, the fund may review several factors including, but not limited to, market information regarding the specific investment or comparable investments and correlation with other investment types, futures indices or general market indicators. Circumstances that may cause the fund to use these procedures to value an investment include, but are not limited to: an investment has been declared in default or is distressed; trading in a security has been suspended during the trading day or a security is not actively trading on its principal exchange; prices received from a regular pricing source are deemed unreliable; or there is a foreign market holiday and no trading occurred.
The fund monitors for significant events occurring after the close of an investment’s primary exchange but before the fund’s NAV per share is determined. Significant events may include, but are not limited to: corporate announcements and transactions; governmental action and political unrest that could impact a specific investment or an investment sector; or armed conflicts, natural disasters and similar events that could affect investments in a specific country or region. The fund also monitors for significant fluctuations between domestic and foreign markets, as evidenced by the U.S. market or such other indicators that the Board of Directors, or its delegate, deems appropriate. The fund may apply a model-derived factor to the closing price of equity securities traded on foreign securities exchanges. The factor is based on observable market data as provided by an independent pricing service.
14
Security Transactions — Security transactions are accounted for as of the trade date. Net realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes. Certain countries impose taxes on realized gains on the sale of securities registered in their country. The fund records the foreign tax expense, if any, on an accrual basis. The foreign tax expense on realized gains and unrealized appreciation reduces the net realized gain (loss) on investment transactions and net unrealized appreciation (depreciation) on investments, respectively.
Investment Income — Dividend income less foreign taxes withheld, if any, is recorded as of the ex-dividend date. Distributions received on securities that represent a return of capital or long-term capital gain are recorded as a reduction of cost of investments and/or as a realized gain. The fund may estimate the components of distributions received that may be considered nontaxable distributions or long-term capital gain distributions for income tax purposes. Interest income less foreign taxes withheld, if any, is recorded on the accrual basis and includes accretion of discounts and amortization of premiums. Securities lending income is net of fees and rebates earned by the lending agent for its services.
Foreign Currency Translations — All assets and liabilities initially expressed in foreign currencies are translated into U.S. dollars at prevailing exchange rates at period end. The fund may enter into spot foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of investment securities, dividend and interest income, spot foreign currency exchange contracts, and expenses are translated at the rates of exchange prevailing on the respective dates of such transactions. Net realized and unrealized foreign currency exchange gains or losses related to investment securities are a component of net realized gain (loss) on investment transactions and change in net unrealized appreciation (depreciation) on investments, respectively.
Repurchase Agreements — The fund may enter into repurchase agreements with institutions that American Century Investment Management, Inc. (ACIM) (the investment advisor) has determined are creditworthy pursuant to criteria adopted by the Board of Directors. The fund requires that the collateral, represented by securities, received in a repurchase transaction be transferred to the custodian in a manner sufficient to enable the fund to obtain those securities in the event of a default under the repurchase agreement. ACIM monitors, on a daily basis, the securities transferred to ensure the value, including accrued interest, of the securities under each repurchase agreement is equal to or greater than amounts owed to the fund under each repurchase agreement.
Joint Trading Account — Pursuant to an Exemptive Order issued by the Securities and Exchange Commission, the fund, along with certain other funds in the American Century Investments family of funds, may transfer uninvested cash balances into a joint trading account. These balances are invested in one or more repurchase agreements that are collateralized by U.S. Treasury or Agency obligations.
Segregated Assets — In accordance with the 1940 Act, the fund segregates assets on its books and records to cover certain types of investment securities and other financial instruments. ACIM monitors, on a daily basis, the securities segregated to ensure the fund designates a sufficient amount of liquid assets, marked-to-market daily. The fund may also receive assets or be required to pledge assets at the custodian bank or with a broker for collateral requirements.
Income Tax Status — It is the fund’s policy to distribute substantially all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code. Accordingly, no provision has been made for income taxes. The fund files U.S. federal, state, local and non-U.S. tax returns as applicable. The fund's tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years from the date of filing but can be longer in certain jurisdictions. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Distributions to Shareholders — Distributions from net investment income and net realized gains, if any, are generally declared and paid annually. The fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code, in all events in a manner consistent with provisions of the 1940 Act. The fund may elect to treat a portion of its payment to a redeeming shareholder, which represents the pro rata share of undistributed net investment income and net realized gains, as a distribution for federal income tax purposes (tax equalization).
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Indemnifications — Under the corporation’s organizational documents, its officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business, the fund enters into contracts that provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against a fund. The risk of material loss from such claims is considered by management to be remote.
Securities Lending — Securities are lent to qualified financial institutions and brokers. State Street Bank & Trust Co. serves as securities lending agent to the fund pursuant to a Securities Lending Agreement. The lending of securities exposes the fund to risks such as: the borrowers may fail to return the loaned securities, the borrowers may not be able to provide additional collateral, the fund may experience delays in recovery of the loaned securities or delays in access to collateral, or the fund may experience losses related to the investment collateral. To minimize certain risks, loan counterparties pledge collateral in the form of cash and/or securities. The lending agent has agreed to indemnify the fund in the case of default of any securities borrowed. Cash collateral received is invested in the State Street Navigator Securities Lending Government Money Market Portfolio, a money market mutual fund registered under the 1940 Act. The loans may also be secured by U.S. government securities in an amount at least equal to the market value of the securities loaned, plus accrued interest and dividends, determined on a daily basis and adjusted accordingly. By lending securities, the fund seeks to increase its net investment income through the receipt of interest and fees. Such income is reflected separately within the Statement of Operations. The value of loaned securities and related collateral outstanding at period end, if any, are shown on a gross basis within the Schedule of Investments and Statement of Assets and Liabilities.
3. Fees and Transactions with Related Parties
Certain officers and directors of the corporation are also officers and/or directors of American Century Companies, Inc. (ACC). The corporation’s investment advisor, ACIM, the corporation's distributor, American Century Investment Services, Inc., and the corporation’s transfer agent, American Century Services, LLC, are wholly owned, directly or indirectly, by ACC. Various funds issued by American Century Asset Allocation Portfolios, Inc. own, in aggregate, 48% of the shares of the fund. Related parties do not invest in the fund for the purpose of exercising management or control.
Management Fees —The corporation has entered into a management agreement with ACIM, under which ACIM provides the fund with investment advisory and management services in exchange for a single, unified management fee (the fee). The agreement provides that ACIM will pay all expenses of managing and operating the fund, except brokerage expenses, taxes, interest, fees and expenses of the independent directors (including legal counsel fees), and extraordinary expenses. The fee is computed and accrued daily based on the daily net assets of the fund and paid monthly in arrears. The annual management fee is 0.90%. The investment advisor agreed to waive the fund's management fee in its entirety. The investment advisor expects this waiver to remain in effect permanently and cannot terminate it without the approval of the Board of Directors. The annual management fee for the period ended November 30, 2021 was 0.00% after waiver.
Directors' Fees and Expenses — The Board of Directors is responsible for overseeing the investment advisor’s management and operations of the fund. The directors receive detailed information about the fund and its investment advisor regularly throughout the year, and meet at least quarterly with management of the investment advisor to review reports about fund operations. The fund’s officers do not receive compensation from the fund.
Interfund Transactions — The fund may enter into security transactions with other American Century Investments funds and other client accounts of the investment advisor, in accordance with the 1940 Act rules and procedures adopted by the Board of Directors. The rules and procedures require, among other things, that these transactions be effected at the independent current market price of the security. There were no interfund transactions during the period.
4. Investment Transactions
Purchases and sales of investment securities, excluding short-term investments, for the period ended November 30, 2021 were $482,515,072 and $388,649,076, respectively.
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5. Fair Value Measurements
The fund’s investments valuation process is based on several considerations and may use multiple inputs to determine the fair value of the investments held by the fund. In conformity with accounting principles generally accepted in the United States of America, the inputs used to determine a valuation are classified into three broad levels.
•Level 1 valuation inputs consist of unadjusted quoted prices in an active market for identical investments.
•Level 2 valuation inputs consist of direct or indirect observable market data (including quoted prices for comparable investments, evaluations of subsequent market events, interest rates, prepayment speeds, credit risk, etc.). These inputs also consist of quoted prices for identical investments initially expressed in local currencies that are adjusted through translation into U.S. dollars.
•Level 3 valuation inputs consist of unobservable data (including a fund’s own assumptions).
The level classification is based on the lowest level input that is significant to the fair valuation measurement. The valuation inputs are not necessarily an indication of the risks associated with investing in these securities or other financial instruments.
The following is a summary of the level classifications as of period end. The Schedule of Investments provides additional information on the fund’s portfolio holdings.
Level 1 | Level 2 | Level 3 | |||||||||
Assets | |||||||||||
Investment Securities | |||||||||||
Common Stocks | |||||||||||
Brazil | $ | 7,230,630 | $ | 21,817,638 | — | ||||||
China | 37,559,707 | 214,985,963 | — | ||||||||
India | 27,037,050 | 61,875,977 | — | ||||||||
Luxembourg | 6,157,412 | — | — | ||||||||
Mexico | 6,518,084 | 14,389,425 | — | ||||||||
Russia | 12,696,115 | 41,192,398 | — | ||||||||
Singapore | 6,966,973 | — | — | ||||||||
United States | 2,686,995 | — | — | ||||||||
Other Countries | — | 358,399,913 | — | ||||||||
Rights | — | 18,301 | — | ||||||||
Temporary Cash Investments | 866,136 | 17,388,580 | — | ||||||||
$ | 107,719,102 | $ | 730,068,195 | — |
6. Risk Factors
The value of the fund’s shares will go up and down, sometimes rapidly or unpredictably, based on the performance of the securities owned by the fund and other factors generally affecting the securities market. Market risks, including political, regulatory, economic and social developments, can affect the value of the fund’s investments. Natural disasters, public health emergencies, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse long-term effects on world economies and markets generally.
There are certain risks involved in investing in foreign securities. These risks include those resulting from political events (such as civil unrest, national elections and imposition of exchange controls), social and economic events (such as labor strikes and rising inflation), and natural disasters. Securities of foreign issuers may be less liquid and more volatile. Investing in emerging markets or a significant portion of assets in one country or region may accentuate these risks.
The fund is owned by a relatively small number of shareholders, and in the event such shareholders redeem, the ongoing operations of the fund may be at risk.
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7. Federal Tax Information
On December 21, 2021, the fund declared and paid per-share distributions of $0.4826 and $0.2368 from net net realized gains and net investment income, respectively, to shareholders of record on December 20, 2021.
The tax character of distributions paid during the years ended November 30, 2021 and November 30, 2020 were as follows:
2021 | 2020 | |||||||
Distributions Paid From | ||||||||
Ordinary income | $ | 13,098,155 | $ | 12,202,414 | ||||
Long-term capital gains | — | — |
The book-basis character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements.
As of period end, the federal tax cost of investments and the components of distributable earnings on a tax-basis were as follows:
Federal tax cost of investments | $ | 664,620,152 | |||
Gross tax appreciation of investments | $ | 206,169,148 | |||
Gross tax depreciation of investments | (33,002,003) | ||||
Net tax appreciation (depreciation) of investments | 173,167,145 | ||||
Net tax appreciation (depreciation) on translation of assets and liabilities in foreign currencies | (1,620,971) | ||||
Net tax appreciation (depreciation) | $ | 171,546,174 | |||
Undistributed ordinary income | $ | 14,527,194 | |||
Accumulated long-term gains | $ | 29,608,100 |
The difference between book-basis and tax-basis unrealized appreciation (depreciation) is attributable primarily to the realization to ordinary income for tax purposes of unrealized gains on investments in passive foreign investment companies.
8. Corporate Event
On December 2, 2021, the Board of Directors approved an agreement and plan of reorganization (the reorganization), whereby the net assets of the fund will be transferred to Emerging Markets Fund, one fund in a series issued by the corporation, in exchange for shares of Emerging Markets Fund. The financial statements and performance history of Emerging Markets Fund will survive after the reorganization. The reorganization is expected to be completed in 2022.
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Financial Highlights |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Operating Expenses (before expense waiver) | Net Investment Income (Loss) | Net Investment Income (Loss) (before expense waiver) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||||||
G Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $13.97 | 0.25 | 0.04 | 0.29 | (0.25) | — | (0.25) | $14.01 | 2.06% | 0.01% | 0.91% | 1.61% | 0.71% | 49% | $839,824 | ||||||||||||||||||||||||||||||||
2020 | $11.52 | 0.18 | 2.60 | 2.78 | (0.33) | — | (0.33) | $13.97 | 24.62% | 0.02% | 0.92% | 1.50% | 0.60% | 61% | $730,749 | ||||||||||||||||||||||||||||||||
2019 | $11.19 | 0.31 | 0.94 | 1.25 | (0.15) | (0.77) | (0.92) | $11.52 | 12.54% | 0.01% | 0.91% | 2.80% | 1.90% | 50% | $431,996 | ||||||||||||||||||||||||||||||||
2018 | $14.54 | 0.23 | (2.00) | (1.77) | (0.14) | (1.44) | (1.58) | $11.19 | (13.75)% | 0.01% | 0.95% | 1.78% | 0.84% | 66% | $402,978 | ||||||||||||||||||||||||||||||||
2017 | $10.27 | 0.09 | 4.26 | 4.35 | (0.08) | — | (0.08) | $14.54 | 42.75% | 0.69% | 1.25% | 0.74% | 0.18% | 56% | $481,494 |
Notes to Financial Highlights |
(1)Computed using average shares outstanding throughout the period.
(2)Total returns are calculated based on the net asset value of the last business day. Total returns for periods less than one year are not annualized.
See Notes to Financial Statements.
Report of Independent Registered Public Accounting Firm |
To the Shareholders and the Board of Directors of American Century World Mutual Funds, Inc.:
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of NT Emerging Markets Fund (the “Fund”), one of the funds constituting the American Century World Mutual Funds, Inc., as of November 30, 2021, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of NT Emerging Markets Fund of the American Century World Mutual Funds, Inc. as of November 30, 2021, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund’s financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. 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, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of November 30, 2021, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
/s/ Deloitte & Touche LLP
Kansas City, Missouri
January 19, 2022
We have served as the auditor of one or more American Century investment companies since 1997.
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Management |
The Board of Directors
The individuals listed below serve as directors of the funds. Each director will continue to serve in this capacity until death, retirement, resignation or removal from office. The board has adopted a mandatory retirement age for directors who are not “interested persons,” as that term is defined in the Investment Company Act (independent directors). Independent directors shall retire by December 31 of the year in which they reach their 75th birthday.
Jonathan S. Thomas is an “interested person” because he currently serves as President and Chief Executive Officer of American Century Companies, Inc. (ACC), the parent company of American Century Investment Management, Inc. (ACIM or the advisor). The other directors (more than three-fourths of the total number) are independent. They are not employees, directors or officers of, and have no financial interest in, ACC or any of its wholly owned, direct or indirect, subsidiaries, including ACIM, American Century Investment Services, Inc. (ACIS) and American Century Services, LLC (ACS), and they do not have any other affiliations, positions or relationships that would cause them to be considered “interested persons” under the Investment Company Act. The directors serve in this capacity for seven (in the case of Jonathan S. Thomas, 16; and Stephen E. Yates, 8) registered investment companies in the American Century Investments family of funds.
The following table presents additional information about the directors. The mailing address for each director is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Thomas W. Bunn (1953) | Director | Since 2017 | Retired | 72 | SquareTwo Financial; Barings (formerly Babson Capital Funds Trust) (2013 to 2016) | ||||||||||||
Chris H. Cheesman (1962) | Director | Since 2019 | Retired. Senior Vice President & Chief Audit Executive, AllianceBernstein (1999 to 2018) | 72 | Alleghany Corporation | ||||||||||||
Barry Fink (1955) | Director | Since 2012 (independent since 2016) | Retired | 72 | None | ||||||||||||
Rajesh K. Gupta (1960) | Director | Since 2019 | Partner Emeritus, SeaCrest Investment Management and SeaCrest Wealth Management (2019 to Present); Chief Executive Officer and Chief Investment Officer, SeaCrest Investment Management (2006 to 2019); Chief Executive Officer and Chief Investment Officer, SeaCrest Wealth Management (2008 to 2019) | 72 | None |
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Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Lynn Jenkins (1963) | Director | Since 2019 | Consultant, LJ Strategies (2019 to present); United States Representative, U.S. House of Representatives (2009 to 2018) | 72 | MGP Ingredients, Inc. (2019 to 2021) | ||||||||||||
Jan M. Lewis (1957) | Director | Since 2011 | Retired | 72 | None | ||||||||||||
John R. Whitten(1) (1946) | Director | Since 2008 | Retired | 72 | Onto Innovation Inc. (2019 to 2020); Rudolph Technologies, Inc. (2006 to 2019) | ||||||||||||
Stephen E. Yates (1948) | Director and Chairman of the Board | Since 2012 (Chairman since 2018) | Retired | 108 | None | ||||||||||||
Interested Director | |||||||||||||||||
Jonathan S. Thomas (1963) | Director | Since 2007 | President and Chief Executive Officer, ACC (2007 to present). Also serves as Chief Executive Officer, ACS; Director, ACC and other ACC subsidiaries | 146 | None |
(1) Effective December 31, 2021, John R. Whitten retired from the Board of Directors.
The Statement of Additional Information has additional information about the fund's directors and is available without charge, upon request, by calling 1-800-345-2021.
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Officers
The following table presents certain information about the executive officers of the funds. Each officer serves as an officer for each of the 16 (in the case of Robert J. Leach, 15) investment companies in the American Century family of funds. No officer is compensated for his or her service as an officer of the funds. The listed officers are interested persons of the funds and are appointed or re-appointed on an annual basis. The mailing address for each officer listed below is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Offices with the Funds | Principal Occupation(s) During the Past Five Years | ||||||
Patrick Bannigan (1965) | President since 2019 | Executive Vice President and Director, ACC (2012 to present); Chief Financial Officer, Chief Accounting Officer and Treasurer, ACC (2015 to present). Also serves as President, ACS; Vice President, ACIM; Chief Financial Officer, Chief Accounting Officer and/or Director, ACIM, ACS and other ACC subsidiaries | ||||||
R. Wes Campbell (1974) | Chief Financial Officer and Treasurer since 2018 | Vice President, ACS, (2020 to present); Investment Operations and Investment Accounting, ACS (2000 to present) | ||||||
Amy D. Shelton (1964) | Chief Compliance Officer and Vice President since 2014 | Chief Compliance Officer, American Century funds, (2014 to present); Chief Compliance Officer, ACIM (2014 to present); Chief Compliance Officer, ACIS (2009 to present). Also serves as Vice President, ACIS | ||||||
John Pak (1968) | General Counsel and Senior Vice President since 2021 | General Counsel and Senior Vice President, ACC (2021 to present). Also serves as General Counsel and Senior Vice President, ACIM, ACS and ACIS. Chief Legal Officer of Investment and Wealth Management, The Bank of New York Mellon (2014 to 2021) | ||||||
C. Jean Wade (1964) | Vice President since 2012 | Senior Vice President, ACS (2017 to present); Vice President, ACS (2000 to 2017) | ||||||
Robert J. Leach (1966) | Vice President since 2006 | Vice President, ACS (2000 to present) | ||||||
David H. Reinmiller (1963) | Vice President since 2000 | Attorney, ACC (1994 to present). Also serves as Vice President, ACIM and ACS | ||||||
Ward D. Stauffer (1960) | Secretary since 2005 | Attorney, ACC (2003 to present) |
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Approval of Management Agreement |
At a meeting held on June 30, 2021, the Fund’s Board of Directors (the "Board") unanimously approved the renewal of the management agreement pursuant to which American Century Investment Management, Inc. (the “Advisor”) acts as the investment advisor for the Fund. Under Section 15(c) of the Investment Company Act, contracts for investment advisory services are required to be reviewed, evaluated, and approved by a majority of a fund’s directors (the “Directors”), including a majority of the independent Directors, each year.
Prior to its consideration of the renewal of the management agreement, the Directors requested and reviewed extensive data and information compiled by the Advisor and certain independent providers of evaluation data concerning the Fund and the services provided to the Fund by the Advisor. This review was in addition to the oversight and evaluation undertaken by the Board and its committees on a continual basis and the information received was supplemental to the extensive information that the Board and its committees receive and consider throughout the year.
In connection with its consideration of the renewal of the management agreement, the Board’s review and evaluation of the services provided by the Advisor and its affiliates included, but was not limited to, the following:
•the nature, extent, and quality of investment management, shareholder services, and other services provided and to be provided to the Fund including without limitation portfolio management and trading services, shareholder and intermediary services, compliance and legal services, fund accounting and financial reporting, and fund share distribution;
•the wide range of other programs and services provided and to be provided to the Fund and its shareholders on a routine and non-routine basis;
•the Fund’s investment performance, including data comparing the Fund's performance to appropriate benchmarks and/or a peer group of other mutual funds with similar investment objectives and strategies;
•the cost of owning the Fund compared to the cost of owning similar funds;
•the compliance policies, procedures, and regulatory experience of the Advisor and the Fund's service providers;
•the Advisor’s strategic plans, COVID-19 pandemic response, vendor management practices, and social justice initiatives;
•the Advisor’s business continuity plans and cyber security practices;
•financial data showing the cost of services provided to the Fund, the profitability of the Fund to the Advisor, and the overall profitability of the Advisor;
•possible economies of scale associated with the Advisor’s management of the Fund and other accounts;
•services provided and charges to the Advisor's other investment management clients;
•acquired fund fees and expenses;
•payments and practices in connection with financial intermediaries holding shares of the Fund and the services provided by intermediaries in connection therewith; and
•possible collateral benefits to the Advisor from the management of the Fund.
The Board held two meetings to consider the renewal. The independent Directors also met in private session three times to review and discuss the information provided in response to their request. The independent Directors held active discussions with the Advisor regarding the renewal of the management agreement, requesting supplemental information, and reviewing information provided by the Advisor in response thereto. The independent Directors had the benefit of the advice of their independent counsel throughout the process.
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Factors Considered
The Directors considered all of the information provided by the Advisor, the independent data providers, and independent counsel in connection with the approval. They determined that the information was sufficient for them to evaluate the management agreement for the Fund. In connection with their review, the Directors did not identify any single factor as being all-important or controlling, and each Director may have attributed different levels of importance to different factors. In deciding to renew the management agreement, the Board based its decision on a number of factors, including without limitation the following:
Nature, Extent and Quality of Services — Generally. Under the management agreement, the Advisor is responsible for providing or arranging for all services necessary for the operation of the Fund. The Board noted that the Advisor provides or arranges at its own expense a wide variety of services which include the following:
•constructing and designing the Fund
•portfolio research and security selection
•initial capitalization/funding
•securities trading
•Fund administration
•custody of Fund assets
•daily valuation of the Fund’s portfolio
•liquidity monitoring and management
•risk management, including cyber security
•shareholder servicing and transfer agency, including shareholder confirmations, recordkeeping, and communications
•legal services (except the independent Directors’ counsel)
•regulatory and portfolio compliance
•financial reporting
•marketing and distribution (except amounts paid by the Fund under Rule 12b-1 plans)
The Board noted that many of these services have expanded over time in terms of both quantity and complexity in response to shareholder demands, competition in the industry, changing distribution channels, and the changing regulatory environment.
Investment Management Services. The nature of the investment management services provided to the Fund is quite complex and allows Fund shareholders access to professional money management, instant diversification of their investments within an asset class, the opportunity to easily diversify among asset classes by investing in or exchanging among various American Century Investments funds, and liquidity. In evaluating investment performance, the Board expects the Advisor to manage the Fund in accordance with its investment objectives and approved strategies. Further, the Directors recognize that the Advisor has an obligation to monitor trading activities, and in particular to seek the best execution of fund trades, and to evaluate the use of and payment for research. In providing these services, the Advisor utilizes teams of investment professionals (portfolio managers, analysts, research assistants, and securities traders) who require extensive information technology, research, training, compliance, and other systems to conduct their business. The Board, directly and through its Fund Performance Review Committee, provides oversight of the investment performance process. It regularly reviews investment performance information for the Fund, together with comparative information for appropriate benchmarks and/or peer groups of similarly-managed funds, over different time horizons. The Directors also review investment performance information during the management agreement renewal process. If performance concerns are identified, the Fund receives special reviews until performance improves, during which the Board discusses with the Advisor the reasons for such results (e.g., market conditions, security selection) and any efforts being undertaken to improve performance. The Fund’s performance was above its benchmark for the one-, three-, five-, and ten-year periods reviewed by the Board. The Board found the investment management services provided by the Advisor to the Fund to be satisfactory and consistent with the management agreement.
25
Shareholder and Other Services. Under the management agreement, the Advisor provides the Fund with a comprehensive package of transfer agency, shareholder, and other services. The Board, directly and through its various committees, regularly reviews reports and evaluations of such services at its regular meetings. These reports include, but are not limited to, information regarding the operational efficiency and accuracy of the shareholder and transfer agency services provided, staffing levels, shareholder satisfaction, technology support (including cyber security), new products and services offered to Fund shareholders, securities trading activities, portfolio valuation services, auditing services, and legal and operational compliance activities. The Board found the services provided by the Advisor to the Fund under the management agreement to be competitive and of high quality.
Costs of Services and Profitability. The Advisor provides detailed information concerning its cost of providing various services to the Fund, its profitability in managing the Fund (pre- and post-distribution), its overall profitability, and its financial condition. The Directors have reviewed with the Advisor the methodology used to prepare this financial information. This information is considered in evaluating the Advisor’s financial condition, its ability to continue to provide services under the management agreement, and the reasonableness of the current management fee. The Board concluded that the Advisor’s profits were reasonable in light of the services provided to the Fund.
Ethics. The Board generally considers the Advisor’s commitment to providing quality services to shareholders and to conducting its business ethically. They noted that the Advisor’s practices generally meet or exceed industry best practices.
Economies of Scale. The Board also reviewed information provided by the Advisor regarding the possible existence of economies of scale in connection with the management of the Fund. The Board concluded that economies of scale are difficult to measure and predict with precision, especially on a fund-by-fund basis. The Board concluded that the Advisor is sharing economies of scale, to the extent they exist, through its competitive fee structure, offering competitive fees from fund inception, and through reinvestment in its business, infrastructure, investment capabilities and initiatives to provide shareholders additional content and services.
Comparison to Other Funds’ Fees. The management agreement provides that the Fund pays the Advisor a single, all-inclusive (or unified) management fee for providing all services necessary for the management and operation of the Fund, other than brokerage expenses, expenses attributable to short sales, taxes, interest, extraordinary expenses, fees and expenses of the Fund’s independent Directors (including their independent legal counsel), and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the Investment Company Act. Under the unified fee structure, the Advisor is responsible for providing all investment advisory, custody, audit, administrative, compliance, recordkeeping, marketing and shareholder services, or arranging and supervising third parties to provide such services. By contrast, most other funds are charged a variety of fees, including an investment advisory fee, a transfer agency fee, an administrative fee, distribution charges, and other expenses. Other than their investment advisory fees and any applicable Rule 12b-1 distribution fees, all other components of the total fees charged by these other funds may be increased without shareholder approval. The Board believes the unified fee structure is a benefit to Fund shareholders because it clearly discloses to shareholders the cost of owning Fund shares, and, since the unified fee cannot be increased without a vote of Fund shareholders, it shifts to the Advisor the risk of increased costs of operating the Fund and provides a direct incentive to minimize administrative inefficiencies. Part of the Board’s analysis of fee levels involves reviewing certain evaluative data compiled by an independent provider comparing the Fund’s unified fee to the total expense ratios of its peers. The unified fee charged to shareholders of the Fund was below the median of the total expense ratios of the Fund’s peer expense universe. In addition, the Board reviewed the Fund’s position relative to the narrower set of its expense group peers. The Board concluded that the management fee paid by the Fund to the Advisor under the management agreement is reasonable in light of the services provided to the Fund.
Comparison to Fees and Services Provided to Other Clients of the Advisor. The Board also requested and received information from the Advisor concerning the nature of the services, fees, costs, and profitability of its advisory services to advisory clients other than the Fund. They observed that these varying types of client accounts require different services and involve different
26
regulatory and entrepreneurial risks than the management of the Fund. The Board analyzed this information and concluded that the fees charged and services provided to the Fund were reasonable by comparison.
Payments to Intermediaries. The Directors also requested and received a description of payments made to intermediaries by the Fund and the Advisor and services provided in response thereto. These payments include various payments made by the Fund or the Advisor to different types of intermediaries and recordkeepers for distribution and service activities provided for the Fund. The Directors reviewed such information and received representations from the Advisor that all such payments by the Fund were made pursuant to the Fund's Rule 12b-1 Plan and that all such payments by the Advisor were made from the Advisor’s resources and reasonable profits. The Board found such payments to be reasonable in scope and purpose.
Collateral or “Fall-Out” Benefits Derived by the Advisor. The Board considered the possible existence of collateral benefits the Advisor may receive as a result of its relationship with the Fund. They concluded that the Advisor’s primary business is managing funds and it generally does not use fund or shareholder information to generate profits in other lines of business, and therefore does not derive any significant collateral benefits from them. To the extent there are potential collateral benefits, the Board has been advised and has taken this into consideration in its review of the management contract with the Fund. The Board noted that additional assets from other clients may offer the Advisor some benefit from increased leverage with service providers and counterparties. Additionally, the Advisor may receive proprietary research from broker-dealers that execute fund portfolio transactions, which the Board concluded is likely to benefit other clients of the Advisor, as well as Fund shareholders. The Board also determined that the Advisor is able to provide investment management services to certain clients other than the Fund, at least in part, due to its existing infrastructure built to serve the fund complex. The Board concluded that appropriate allocation methodologies had been employed to assign resources and the cost of those resources to these other clients.
Existing Relationship. The Board also considered whether there was any reason for not continuing the existing arrangement with the Advisor. In this regard, the Board was mindful of the potential disruptions of the Fund’s operations and various risks, uncertainties, and other effects that could occur as a result of a decision not to continue such relationship. In particular, the Board recognized that most shareholders have invested in the Fund on the strength of the Advisor’s industry standing and reputation and in the expectation that the Advisor will have a continuing role in providing advisory services to the Fund.
Conclusion of the Directors. As a result of this process, the Board, including all of the independent Directors, taking into account all of the factors discussed above and the information provided by the Advisor and others in connection with its review and throughout the year, determined that the management fee is fair and reasonable in light of the services provided and that the investment management agreement between the Fund and the Advisor should be renewed.
27
Additional Information |
Retirement Account Information
As required by law, distributions you receive from certain retirement accounts are subject to federal income tax withholding, unless you elect not to have withholding apply*. Tax will be withheld on the total amount withdrawn even though you may be receiving amounts that are not subject to withholding, such as nondeductible contributions. In such case, excess amounts of withholding could occur. You may adjust your withholding election so that a greater or lesser amount will be withheld.
If you don’t want us to withhold on this amount, you must notify us to not withhold the federal income tax. You may notify us in writing or in certain situations by telephone or through other electronic means. For systematic withdrawals, your withholding election will remain in effect until revoked or changed by filing a new election. You have the right to revoke your election at any time and change your withholding percentage for future distributions.
Remember, even if you elect not to have income tax withheld, you are liable for paying income tax on the taxable portion of your withdrawal. If you elect not to have income tax withheld or you don’t have enough income tax withheld, you may be responsible for payment of estimated tax. You may incur penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. You can reduce or defer the income tax on a distribution by directly or indirectly rolling such distribution over to another IRA or eligible plan. You should consult your tax advisor for additional information.
State tax will be withheld if, at the time of your distribution, your address is within one of the mandatory withholding states and you have federal income tax withheld (or as otherwise required by state law). State taxes will be withheld from your distribution in accordance with the respective state rules.
*Some 403(b), 457 and qualified retirement plan distributions may be subject to 20% mandatory withholding, as they are subject to special tax and withholding rules. Your plan administrator or plan sponsor is required to provide you with a special tax notice explaining those rules at the time you request a distribution. If applicable, federal and/or state taxes may be withheld from your distribution amount.
Proxy Voting Policies
A description of the policies that the fund's investment advisor uses in exercising the voting rights associated with the securities purchased and/or held by the fund is available without charge, upon request, by calling 1-800-345-2021. It is also available on American Century Investments’ website at americancentury.com/proxy and on the Securities and Exchange Commission’s website at sec.gov. Information regarding how the investment advisor voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on americancentury.com/proxy. It is also available at sec.gov.
Quarterly Portfolio Disclosure
The fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. These portfolio holdings are available on the fund's website at americancentury.com and, upon request, by calling 1-800-345-2021. The fund’s Form N-PORT reports are available on the SEC’s website at sec.gov.
28
Other Tax Information
The following information is provided pursuant to provisions of the Internal Revenue Code.
The fund hereby designates up to the maximum amount allowable as qualified dividend income for
the fiscal year ended November 30, 2021.
The fund hereby designates $811,628, or up to the maximum amount allowable, as long-term
capital gain distributions (20% rate gain distributions) for the fiscal year ended November 30, 2021.
For the fiscal year ended November 30, 2021, the fund intends to pass through to shareholders
foreign source income of $14,846,916 and foreign taxes paid of $1,354,771, or up to the maximum
amount allowable, as a foreign tax credit. Foreign source income and foreign tax expense per
outstanding share on November 30, 2021 are $0.2476 and $0.0226, respectively.
The fund utilized earnings and profits of $1,256,543 distributed to shareholders on redemption of
shares as part of the dividends paid deduction (tax equalization).
29
Notes |
30
Notes |
31
Notes |
32
![]() | ||||||||
Contact Us | americancentury.com | |||||||
Automated Information Line | 1-800-345-8765 | |||||||
Investor Services Representative | 1-800-345-2021 or 816-531-5575 | |||||||
Investors Using Advisors | 1-800-378-9878 | |||||||
Business, Not-For-Profit, Employer-Sponsored Retirement Plans | 1-800-345-3533 | |||||||
Banks and Trust Companies, Broker-Dealers, Financial Professionals, Insurance Companies | 1-800-345-6488 | |||||||
Telecommunications Relay Service for the Deaf | 711 | |||||||
American Century World Mutual Funds, Inc. | ||||||||
Investment Advisor: American Century Investment Management, Inc. Kansas City, Missouri | ||||||||
This report and the statements it contains are submitted for the general information of our shareholders. The report is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. | ||||||||
©2022 American Century Proprietary Holdings, Inc. All rights reserved. CL-ANN-91023 2201 |
![image37.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image37.jpg)
Annual Report | |||||
November 30, 2021 | |||||
NT International Growth Fund | |||||
G Class (ACLNX) |
Table of Contents |
Performance | |||||
Portfolio Commentary | |||||
Fund Characteristics | |||||
Shareholder Fee Example | |||||
Schedule of Investments | |||||
Statement of Assets and Liabilities | |||||
Statement of Operations | |||||
Statement of Changes in Net Assets | |||||
Notes to Financial Statements | |||||
Financial Highlights | |||||
Report of Independent Registered Public Accounting Firm | |||||
Management | |||||
Approval of Management Agreement | |||||
Additional Information |
Any opinions expressed in this report reflect those of the author as of the date of the report, and do not necessarily represent the opinions of American Century Investments® or any other person in the American Century Investments organization. Any such opinions are subject to change at any time based upon market or other conditions and American Century Investments disclaims any responsibility to update such opinions. These opinions may not be relied upon as investment advice and, because investment decisions made by American Century Investments funds are based on numerous factors, may not be relied upon as an indication of trading intent on behalf of any American Century Investments fund. Security examples are used for representational purposes only and are not intended as recommendations to purchase or sell securities. Performance information for comparative indices and securities is provided to American Century Investments by third party vendors. To the best of American Century Investments’ knowledge, such information is accurate at the time of printing.
Performance |
Total Returns as of November 30, 2021 | |||||||||||||||||
Average Annual Returns | |||||||||||||||||
Ticker Symbol | 1 year | 5 years | 10 years | Inception Date | |||||||||||||
G Class | ACLNX | 11.71% | 15.33% | 10.27% | 5/12/06 | ||||||||||||
MSCI EAFE Index | — | 10.77% | 9.19% | 7.38% | — | ||||||||||||
MSCI EAFE Growth Index | — | 11.84% | 13.12% | 9.46% | — |
Fund returns would have been lower if a portion of the fees had not been waived.
Growth of $10,000 Over 10 Years | ||
$10,000 investment made November 30, 2011 | ||
![chart-f0b434830f144a6a924.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/chart-f0b434830f144a6a924.jpg)
Value on November 30, 2021 | |||||
G Class — $26,613 | |||||
MSCI EAFE Index — $20,400 | |||||
MSCI EAFE Growth Index — $24,709 | |||||
Ending value of G Class would have been lower if a portion of the fees had not been waived.
Total Annual Fund Operating Expenses | |||||
G Class | 0.83% |
The total annual fund operating expenses shown is as stated in the fund’s prospectus current as of the date of this report. The prospectus may vary from the expense ratio shown elsewhere in this report because it is based on a different time period, includes acquired fund fees and expenses, and, if applicable, does not include fee waivers or expense reimbursements.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
2
Portfolio Commentary |
Portfolio Managers: Raj Gandhi and Jim Zhao
Performance Summary
NT International Growth returned 11.71%* for the fiscal year ended November 30, 2021, outperforming its benchmark, the MSCI EAFE Index, which returned 10.77%.
Stock holdings in the health care sector and positioning within information technology propelled the fund’s performance, with additional contribution from industrials and communication services stocks. Stock selection in the consumer discretionary, financials and energy sectors constrained returns. From a geographic perspective, European holdings and underweight positioning in Japan benefited relative performance, whereas stock selection in the U.K. and positioning in China and Brazil detracted.
The development of effective vaccines against COVID-19 late in 2020 raised hopes for a return to normalized economic activity and spurred strong gains among non-U.S. equities. As vaccine distribution ramped up in early 2021, markets rotated toward stocks exposed to economic expansion. Names that had previously lagged, such as banks, oil producers and automobile manufacturers, rallied. However, as the recovery cycle matured, markets returned to rewarding individual companies demonstrating strong fundamentals and earnings improvement. Increased economic activity led to a strong corporate earnings recovery. In the second half of the period, global supply chain issues and disruptions due to the emergence of new coronavirus variants combined with rising energy costs and inflation concerns to create greater market volatility. Although the rate of corporate earnings improvement slowed late in the period, expectations for continued earnings recovery remained upbeat supported by continued demand strength.
Earnings Surpassed Expectations, Fueled Strong Performance
Among health care holdings, pharmaceuticals company Novo Nordisk reported revenue and earnings that exceeded expectations driven by strong demand for its oral diabetes and weight loss drugs. Companies that provide outsourcing services for pharmaceuticals and biotechnology companies advanced notably. Strong earnings results and the acquisition of PRA Health Sciences lifted the stock of clinical research provider ICON. Contract manufacturer Lonza Group’s stock rose on Food and Drug Administration approval of Biogen’s Alzheimer’s drug, which was expected to use substantial industry capacity.
A diverse array of companies fueled strong performance among information technology stocks. Payment processor Adyen’s stock rose on better-than-expected results as the firm grew its market share amid the accelerating shift to digital payments. Semiconductor equipment manufacturer ASML Holding benefited as rising chip demand exceeded supply. Information technology services firm Capgemini ranked among the top individual contributors to fund performance with ahead-of-expectations results driven by strength in the firm’s digital transformation and cloud-related business.
Among industrials, stock of Techtronic Industries, the maker of Ryobi and Milwaukee power tools, rose on reported results that significantly exceeded analysts’ estimates as the firm continued to gain market share due to cordless tool product innovation and proprietary battery technology. Human resources technology company Recruit Holdings’ stock also advanced. The firm, which owns Indeed and Glassdoor, benefited amid the return of job search activity to pre-pandemic levels and intensified competition to recruit talent. Ashtead Group, which leases construction equipment, was one of the fund’s top individual contributors. Ashtead’s reported earnings significantly exceeded estimates as the firm benefited from the acceleration in U.S. nonresidential construction, especially public infrastructure, warehouses, data centers and multifamily housing.
*Fund returns would have been lower if a portion of the fees had not been waived.
3
On the downside, retailers Magazine Luiza and ASOS detracted from performance. Magazine Luiza’s stock declined amid intensifying competition in Brazil’s e-commerce market. In addition, weakness in the broader Brazilian market appeared to be slowing consumption trends, and we exited the position. ASOS’ stock fell when management lowered sales guidance for 2021. We sold the stock as ASOS appeared to be struggling to turn around its U.S. operations, and U.S. commercial momentum had been a key pillar of the growth story. Automotive supplier Valeo also declined as concerns over the impact of semiconductor shortages on automobile production pressured the stock.
Within financials, the fund’s underweight in banks weighed on relative returns. In addition, stock of insurer AIA Group underperformed due to concerns over COVID-19 disruptions impacting revenue growth. In energy, Neste’s stock fell due to challenges related to near-term maintenance costs and higher input prices due to a shortage of feedstocks for renewable diesel.
Portfolio Positioning
We remain committed to our disciplined, bottom-up process of identifying companies exhibiting accelerating, sustainable growth. Although the earnings growth that drove the market in the first half of 2021 subsequently stalled amid component and labor shortages, shipping delays and higher energy costs, we believe it should resume in the second half of 2022. In our view, bottlenecks in shipping and supply chains are transitory, and the most recent earnings season suggested that demand remains strong, and companies can pass through costs. We continue to maintain exposure to companies benefiting from strong secular trends, such as green energy and carbon reduction, including firms involved in wind generation, electric vehicle components and emissions testing. We also find opportunities related to shifts in global manufacturing with companies that specialize in factory automation design, components and software benefiting from increased capital investment in digital solutions for a variety of end markets.
As a result of our bottom-up stock selection process, we remain notably overweight to information technology and underweight to consumer staples. Geographically, we retain a large exposure to European stocks. We continue to be underweight to Japan and Asia in general and have reduced our exposure to China.
4
Fund Characteristics |
NOVEMBER 30, 2021 | |||||
Types of Investments in Portfolio | % of net assets | ||||
Common Stocks | 98.8% | ||||
Temporary Cash Investments | 0.5% | ||||
Temporary Cash Investments - Securities Lending Collateral | 1.2% | ||||
Other Assets and Liabilities | (0.5)% | ||||
Top Five Countries | % of net assets | ||||
France | 16.8% | ||||
Japan | 13.5% | ||||
United Kingdom | 9.9% | ||||
Netherlands | 8.7% | ||||
Switzerland | 7.9% |
5
Shareholder Fee Example |
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption/exchange fees; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in your fund and to compare these costs with the ongoing cost of investing in other mutual funds.
The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period from May 29, 2021 to November 30, 2021.
Actual Expenses
The table provides information about actual account values and actual expenses for each class. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. First, identify the share class you own. Then simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The table also provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each class of your fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of a fund’s share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption/exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Beginning Account Value 5/29/21 | Ending Account Value 11/30/21 | Expenses Paid During Period(1) 5/29/21 - 11/30/21 | Annualized Expense Ratio(1) | |||||||||||
Actual | ||||||||||||||
G Class | $1,000 | $990.20 | $0.05 | 0.01% | ||||||||||
Hypothetical | ||||||||||||||
G Class | $1,000 | $1,025.43 | $0.05 | 0.01% |
(1)Expenses are equal to the class's annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 186, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. Annualized expense ratio reflects actual expenses, including any applicable fee waivers or expense reimbursements and excluding any acquired fund fees and expenses.
6
Schedule of Investments |
NOVEMBER 30, 2021
Shares | Value | |||||||
COMMON STOCKS — 98.8% | ||||||||
Australia — 3.9% | ||||||||
Atlassian Corp. plc, Class A(1) | 48,620 | $ | 18,296,678 | |||||
CSL Ltd. | 137,700 | 29,941,141 | ||||||
NEXTDC Ltd.(1) | 541,070 | 4,590,209 | ||||||
Xero Ltd.(1) | 50,470 | 5,126,109 | ||||||
57,954,137 | ||||||||
Austria — 1.1% | ||||||||
Erste Group Bank AG | 392,220 | 17,184,383 | ||||||
Belgium — 1.5% | ||||||||
KBC Group NV | 271,580 | 22,796,515 | ||||||
Canada — 5.3% | ||||||||
Canadian Pacific Railway Ltd. | 240,560 | 16,835,151 | ||||||
First Quantum Minerals Ltd. | 348,610 | 7,430,937 | ||||||
GFL Environmental, Inc.(2) | 442,348 | 17,074,633 | ||||||
Shopify, Inc., Class A(1) | 12,450 | 18,917,236 | ||||||
Toronto-Dominion Bank (The) | 261,480 | 18,452,716 | ||||||
78,710,673 | ||||||||
China — 1.7% | ||||||||
Li Ning Co. Ltd. | 1,127,500 | 12,752,689 | ||||||
Wuxi Biologics Cayman, Inc.(1) | 890,500 | 12,012,652 | ||||||
24,765,341 | ||||||||
Denmark — 4.4% | ||||||||
Carlsberg A/S, B Shares | 97,260 | 15,104,354 | ||||||
DSV A/S | 27,060 | 5,891,657 | ||||||
Novo Nordisk A/S, B Shares | 312,840 | 33,489,512 | ||||||
Pandora A/S | 87,680 | 10,909,357 | ||||||
65,394,880 | ||||||||
Finland — 0.6% | ||||||||
Neste Oyj | 198,700 | 9,397,897 | ||||||
France — 16.8% | ||||||||
Air Liquide SA | 113,220 | 18,697,437 | ||||||
Airbus SE(1) | 103,380 | 11,539,283 | ||||||
Bureau Veritas SA | 400,230 | 12,675,413 | ||||||
Capgemini SE | 114,460 | 26,425,561 | ||||||
Dassault Systemes SE | 306,680 | 18,486,961 | ||||||
Edenred | 250,956 | 11,226,109 | ||||||
L'Oreal SA | 50,320 | 22,721,369 | ||||||
LVMH Moet Hennessy Louis Vuitton SE | 52,270 | 40,644,850 | ||||||
Pernod Ricard SA | 119,720 | 27,470,888 | ||||||
Safran SA | 100,580 | 11,234,156 | ||||||
Schneider Electric SE | 163,790 | 29,068,454 | ||||||
Teleperformance | 39,160 | 16,107,798 | ||||||
Valeo | 161,470 | 4,654,340 | ||||||
250,952,619 | ||||||||
Germany — 5.5% | ||||||||
Brenntag SE | 92,520 | 7,924,378 | ||||||
Daimler AG | 205,930 | 19,285,965 |
7
Shares | Value | |||||||
Infineon Technologies AG | 425,902 | $ | 19,256,499 | |||||
Puma SE | 164,370 | 19,859,396 | ||||||
Symrise AG | 110,210 | 15,503,442 | ||||||
81,829,680 | ||||||||
Hong Kong — 2.5% | ||||||||
AIA Group Ltd. | 2,404,000 | 25,307,971 | ||||||
Techtronic Industries Co. Ltd. | 584,500 | 12,021,239 | ||||||
37,329,210 | ||||||||
India — 1.1% | ||||||||
HDFC Bank Ltd. | 808,310 | 16,013,292 | ||||||
Indonesia — 0.5% | ||||||||
Bank Central Asia Tbk PT | 15,401,000 | 7,825,679 | ||||||
Ireland — 3.4% | ||||||||
CRH plc | 423,560 | 20,591,224 | ||||||
ICON plc(1) | 61,590 | 16,658,247 | ||||||
Ryanair Holdings plc, ADR(1) | 148,920 | 14,229,306 | ||||||
51,478,777 | ||||||||
Israel — 1.0% | ||||||||
Kornit Digital Ltd.(1) | 94,128 | 14,581,368 | ||||||
Italy — 2.4% | ||||||||
Ferrari NV | 76,180 | 19,934,388 | ||||||
Prysmian SpA | 160,340 | 5,944,588 | ||||||
Stellantis NV | 561,734 | 9,619,276 | ||||||
35,498,252 | ||||||||
Japan — 13.5% | ||||||||
BayCurrent Consulting, Inc. | 31,000 | 12,809,756 | ||||||
Food & Life Cos. Ltd. | 399,900 | 16,934,740 | ||||||
Hoya Corp. | 122,000 | 19,310,952 | ||||||
JSR Corp. | 173,900 | 6,469,457 | ||||||
Keyence Corp. | 52,100 | 32,175,981 | ||||||
Kobe Bussan Co. Ltd. | 243,400 | 9,175,390 | ||||||
MonotaRO Co. Ltd. | 483,400 | 9,516,698 | ||||||
Obic Co. Ltd. | 75,800 | 13,940,588 | ||||||
Pan Pacific International Holdings Corp. | 529,700 | 9,042,003 | ||||||
Recruit Holdings Co. Ltd. | 435,800 | 26,461,620 | ||||||
Sony Group Corp. | 258,100 | 31,490,445 | ||||||
Terumo Corp. | 360,100 | 14,664,780 | ||||||
201,992,410 | ||||||||
Netherlands — 8.7% | ||||||||
Adyen NV(1) | 11,274 | 31,227,120 | ||||||
Akzo Nobel NV | 97,820 | 10,293,242 | ||||||
ASML Holding NV | 51,100 | 40,107,388 | ||||||
ING Groep NV | 1,481,530 | 20,465,040 | ||||||
Koninklijke DSM NV | 63,146 | 13,591,322 | ||||||
Universal Music Group NV | 493,630 | 14,169,198 | ||||||
129,853,310 | ||||||||
Norway — 0.5% | ||||||||
AutoStore Holdings Ltd.(1) | 1,424,560 | 7,119,217 | ||||||
Singapore — 0.6% | ||||||||
Sea Ltd., ADR(1) | 30,370 | 8,748,686 | ||||||
Spain — 2.6% | ||||||||
Cellnex Telecom SA | 353,622 | 20,855,184 |
8
Shares | Value | |||||||
Iberdrola SA | 1,620,598 | $ | 18,186,425 | |||||
39,041,609 | ||||||||
Sweden — 2.3% | ||||||||
Epiroc AB, A Shares | 620,160 | 15,013,893 | ||||||
Hexagon AB, B Shares | 1,305,210 | 18,981,232 | ||||||
33,995,125 | ||||||||
Switzerland — 7.9% | ||||||||
Lonza Group AG | 34,800 | 28,060,890 | ||||||
On Holding AG, Class A(1) | 176,770 | 7,099,083 | ||||||
Partners Group Holding AG | 13,240 | 22,850,221 | ||||||
SIG Combibloc Group AG(1) | 547,730 | 14,438,213 | ||||||
Sika AG | 60,536 | 23,639,364 | ||||||
Zur Rose Group AG(1) | 23,680 | 8,964,336 | ||||||
Zurich Insurance Group AG | 31,490 | 12,945,838 | ||||||
117,997,945 | ||||||||
Taiwan — 0.8% | ||||||||
Taiwan Semiconductor Manufacturing Co. Ltd. | 595,000 | 12,654,862 | ||||||
Thailand — 0.3% | ||||||||
Kasikornbank PCL | 1,304,800 | 5,106,159 | ||||||
United Kingdom — 9.9% | ||||||||
Ashtead Group plc | 379,380 | 30,520,395 | ||||||
AstraZeneca plc | 322,900 | 35,401,062 | ||||||
Burberry Group plc | 333,660 | 7,836,625 | ||||||
HSBC Holdings plc | 4,488,800 | 24,864,710 | ||||||
London Stock Exchange Group plc | 133,740 | 11,585,993 | ||||||
Reckitt Benckiser Group plc | 174,987 | 14,174,472 | ||||||
Segro plc | 757,680 | 14,160,408 | ||||||
Whitbread plc(1) | 269,500 | 10,045,781 | ||||||
148,589,446 | ||||||||
TOTAL COMMON STOCKS (Cost $1,084,944,154) | 1,476,811,472 | |||||||
TEMPORARY CASH INVESTMENTS — 0.5% | ||||||||
Repurchase Agreement, BMO Capital Markets Corp., (collateralized by various U.S. Treasury obligations, 0.125% - 2.625%, 6/30/22 - 5/15/51, valued at $2,021,226), in a joint trading account at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $1,978,840) | 1,978,839 | |||||||
Repurchase Agreement, Fixed Income Clearing Corp., (collateralized by various U.S. Treasury obligations, 1.00%, 7/31/28, valued at $6,732,082), at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $6,600,004) | 6,600,000 | |||||||
State Street Institutional U.S. Government Money Market Fund, Premier Class | 29,352 | 29,352 | ||||||
TOTAL TEMPORARY CASH INVESTMENTS (Cost $8,608,191) | 8,608,191 | |||||||
TEMPORARY CASH INVESTMENTS - SECURITIES LENDING COLLATERAL(3) — 1.2% | ||||||||
State Street Navigator Securities Lending Government Money Market Portfolio (Cost $17,472,746) | 17,472,746 | 17,472,746 | ||||||
TOTAL INVESTMENT SECURITIES — 100.5% (Cost $1,111,025,091) | 1,502,892,409 | |||||||
OTHER ASSETS AND LIABILITIES — (0.5)% | (7,799,950) | |||||||
TOTAL NET ASSETS — 100.0% | $ | 1,495,092,459 |
9
MARKET SECTOR DIVERSIFICATION | |||||
(as a % of net assets) | |||||
Industrials | 18.5% | ||||
Information Technology | 18.3% | ||||
Consumer Discretionary | 14.7% | ||||
Financials | 13.7% | ||||
Health Care | 12.8% | ||||
Materials | 8.8% | ||||
Consumer Staples | 6.4% | ||||
Communication Services | 2.9% | ||||
Utilities | 1.2% | ||||
Real Estate | 0.9% | ||||
Energy | 0.6% | ||||
Temporary Cash Investments | 0.5% | ||||
Temporary Cash Investments - Securities Lending Collateral | 1.2% | ||||
Other Assets and Liabilities | (0.5)% |
NOTES TO SCHEDULE OF INVESTMENTS | ||||||||
ADR | - | American Depositary Receipt |
(1)Non-income producing.
(2)Security, or a portion thereof, is on loan. At the period end, the aggregate value of securities on loan was $17,074,633. The amount of securities on loan indicated may not correspond with the securities on loan identified because securities with pending sales are in the process of recall from the brokers.
(3)Investment of cash collateral from securities on loan. At the period end, the aggregate value of the collateral held by the fund was $17,472,746.
See Notes to Financial Statements.
10
Statement of Assets and Liabilities |
NOVEMBER 30, 2021 | |||||
Assets | |||||
Investment securities, at value (cost of $1,093,552,345) — including $17,074,633 of securities on loan | $ | 1,485,419,663 | |||
Investment made with cash collateral received for securities on loan, at value (cost of $17,472,746) | 17,472,746 | ||||
Total investment securities, at value (cost of $1,111,025,091) | 1,502,892,409 | ||||
Cash | 1,124 | ||||
Foreign currency holdings, at value (cost of $57,157) | 57,471 | ||||
Receivable for investments sold | 6,499,343 | ||||
Receivable for capital shares sold | 619,894 | ||||
Dividends and interest receivable | 3,151,003 | ||||
Securities lending receivable | 843 | ||||
Other assets | 11,087 | ||||
1,513,233,174 | |||||
Liabilities | |||||
Payable for collateral received for securities on loan | 17,472,746 | ||||
Payable for investments purchased | 99 | ||||
Accrued foreign taxes | 571,106 | ||||
Accrued other expenses | 96,764 | ||||
18,140,715 | |||||
Net Assets | $ | 1,495,092,459 | |||
G Class Capital Shares, $0.01 Par Value | |||||
Shares authorized | 1,000,000,000 | ||||
Shares outstanding | 98,875,180 | ||||
Net Asset Value Per Share | $ | 15.12 | |||
Net Assets Consist of: | |||||
Capital (par value and paid-in surplus) | $ | 970,541,083 | |||
Distributable earnings | 524,551,376 | ||||
$ | 1,495,092,459 |
See Notes to Financial Statements.
11
Statement of Operations |
YEAR ENDED NOVEMBER 30, 2021 | |||||
Investment Income (Loss) | |||||
Income: | |||||
Dividends (net of foreign taxes withheld of $3,088,027) | $ | 24,731,721 | |||
Securities lending, net | 683,225 | ||||
Interest | 29,525 | ||||
25,444,471 | |||||
Expenses: | |||||
Management fees | 12,490,754 | ||||
Directors' fees and expenses | 37,353 | ||||
Other expenses | 150,757 | ||||
12,678,864 | |||||
Fees waived | (12,490,754) | ||||
188,110 | |||||
Net investment income (loss) | 25,256,361 | ||||
Realized and Unrealized Gain (Loss) | |||||
Net realized gain (loss) on: | |||||
Investment transactions (net of foreign tax expenses paid (refunded) of $27,555) | 119,080,298 | ||||
Foreign currency translation transactions | (271,810) | ||||
118,808,488 | |||||
Change in net unrealized appreciation (depreciation) on: | |||||
Investments (includes (increase) decrease in accrued foreign taxes of $198,530) | 16,116,200 | ||||
Translation of assets and liabilities in foreign currencies | (61,777) | ||||
16,054,423 | |||||
Net realized and unrealized gain (loss) | 134,862,911 | ||||
Net Increase (Decrease) in Net Assets Resulting from Operations | $ | 160,119,272 |
See Notes to Financial Statements.
12
Statement of Changes in Net Assets |
YEARS ENDED NOVEMBER 30, 2021 AND NOVEMBER 30, 2020 | ||||||||
Increase (Decrease) in Net Assets | November 30, 2021 | November 30, 2020 | ||||||
Operations | ||||||||
Net investment income (loss) | $ | 25,256,361 | $ | 10,208,268 | ||||
Net realized gain (loss) | 118,808,488 | 33,771,309 | ||||||
Change in net unrealized appreciation (depreciation) | 16,054,423 | 186,598,763 | ||||||
Net increase (decrease) in net assets resulting from operations | 160,119,272 | 230,578,340 | ||||||
Distributions to Shareholders | ||||||||
From earnings | (43,138,573) | (21,446,973) | ||||||
Capital Share Transactions | ||||||||
Proceeds from shares sold | 199,988,826 | 592,376,460 | ||||||
Proceeds from reinvestment of distributions | 43,138,573 | 21,446,973 | ||||||
Payments for shares redeemed | (204,021,911) | (311,099,401) | ||||||
Net increase (decrease) in net assets from capital share transactions | 39,105,488 | 302,724,032 | ||||||
Net increase (decrease) in net assets | 156,086,187 | 511,855,399 | ||||||
Net Assets | ||||||||
Beginning of period | 1,339,006,272 | 827,150,873 | ||||||
End of period | $ | 1,495,092,459 | $ | 1,339,006,272 | ||||
Transactions in Shares of the Fund | ||||||||
Sold | 13,383,484 | 47,489,240 | ||||||
Issued in reinvestment of distributions | 3,119,203 | 1,918,957 | ||||||
Redeemed | (13,406,988) | (26,379,155) | ||||||
Net increase (decrease) in shares of the fund | 3,095,699 | 23,029,042 |
See Notes to Financial Statements.
13
Notes to Financial Statements |
NOVEMBER 30, 2021
1. Organization
American Century World Mutual Funds, Inc. (the corporation) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company and is organized as a Maryland corporation. NT International Growth Fund (the fund) is one fund in a series issued by the corporation. The fund's investment objective is to seek capital growth. The fund offers the G Class.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently followed by the fund in preparation of its financial statements. The fund is an investment company and follows accounting and reporting guidance in accordance with accounting principles generally accepted in the United States of America. This may require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from these estimates. Management evaluated the impact of events or transactions occurring through the date the financial statements were issued that would merit recognition or disclosure.
Investment Valuations — The fund determines the fair value of its investments and computes its net asset value (NAV) per share at the close of regular trading (usually 4 p.m. Eastern time) on the New York Stock Exchange (NYSE) on each day the NYSE is open. The Board of Directors has adopted valuation policies and procedures to guide the investment advisor in the fund’s investment valuation process and to provide methodologies for the oversight of the fund’s pricing function.
Equity securities that are listed or traded on a domestic securities exchange are valued at the last reported sales price or at the official closing price as provided by the exchange. Equity securities traded on foreign securities exchanges are generally valued at the closing price of such securities on the exchange where primarily traded or at the close of the NYSE, if that is earlier. If no last sales price is reported, or if local convention or regulation so provides, the mean of the latest bid and asked prices may be used. Securities traded over-the-counter are valued at the mean of the latest bid and asked prices, the last sales price, or the official closing price. Equity securities initially expressed in local currencies are translated into U.S. dollars at the mean of the appropriate currency exchange rate at the close of the NYSE as provided by an independent pricing service.
Open-end management investment companies are valued at the reported NAV per share. Repurchase agreements are valued at cost, which approximates fair value.
If the fund determines that the market price for an investment is not readily available or the valuation methods mentioned above do not reflect an investment’s fair value, such investment is valued as determined in good faith by the Board of Directors or its delegate, in accordance with policies and procedures adopted by the Board of Directors. In its determination of fair value, the fund may review several factors including, but not limited to, market information regarding the specific investment or comparable investments and correlation with other investment types, futures indices or general market indicators. Circumstances that may cause the fund to use these procedures to value an investment include, but are not limited to: an investment has been declared in default or is distressed; trading in a security has been suspended during the trading day or a security is not actively trading on its principal exchange; prices received from a regular pricing source are deemed unreliable; or there is a foreign market holiday and no trading occurred.
The fund monitors for significant events occurring after the close of an investment’s primary exchange but before the fund’s NAV per share is determined. Significant events may include, but are not limited to: corporate announcements and transactions; governmental action and political unrest that could impact a specific investment or an investment sector; or armed conflicts, natural disasters and similar events that could affect investments in a specific country or region. The fund also monitors for significant fluctuations between domestic and foreign markets, as evidenced by the U.S. market or such other indicators that the Board of Directors, or its delegate, deems appropriate. The fund may apply a model-derived factor to the closing price of equity securities traded on foreign securities exchanges. The factor is based on observable market data as provided by an independent pricing service.
14
Security Transactions — Security transactions are accounted for as of the trade date. Net realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes. Certain countries impose taxes on realized gains on the sale of securities registered in their country. The fund records the foreign tax expense, if any, on an accrual basis. The foreign tax expense on realized gains and unrealized appreciation reduces the net realized gain (loss) on investment transactions and net unrealized appreciation (depreciation) on investments, respectively.
Investment Income — Dividend income less foreign taxes withheld, if any, is recorded as of the ex-dividend date. Distributions received on securities that represent a return of capital or long-term capital gain are recorded as a reduction of cost of investments and/or as a realized gain. The fund may estimate the components of distributions received that may be considered nontaxable distributions or long-term capital gain distributions for income tax purposes. Interest income is recorded on the accrual basis and includes accretion of discounts and amortization of premiums. Securities lending income is net of fees and rebates earned by the lending agent for its services.
Foreign Currency Translations — All assets and liabilities initially expressed in foreign currencies are translated into U.S. dollars at prevailing exchange rates at period end. The fund may enter into spot foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of investment securities, dividend and interest income, spot foreign currency exchange contracts, and expenses are translated at the rates of exchange prevailing on the respective dates of such transactions. Net realized and unrealized foreign currency exchange gains or losses related to investment securities are a component of net realized gain (loss) on investment transactions and change in net unrealized appreciation (depreciation) on investments, respectively.
Repurchase Agreements — The fund may enter into repurchase agreements with institutions that American Century Investment Management, Inc. (ACIM) (the investment advisor) has determined are creditworthy pursuant to criteria adopted by the Board of Directors. The fund requires that the collateral, represented by securities, received in a repurchase transaction be transferred to the custodian in a manner sufficient to enable the fund to obtain those securities in the event of a default under the repurchase agreement. ACIM monitors, on a daily basis, the securities transferred to ensure the value, including accrued interest, of the securities under each repurchase agreement is equal to or greater than amounts owed to the fund under each repurchase agreement.
Joint Trading Account — Pursuant to an Exemptive Order issued by the Securities and Exchange Commission, the fund, along with certain other funds in the American Century Investments family of funds, may transfer uninvested cash balances into a joint trading account. These balances are invested in one or more repurchase agreements that are collateralized by U.S. Treasury or Agency obligations.
Segregated Assets — In accordance with the 1940 Act, the fund segregates assets on its books and records to cover certain types of investment securities and other financial instruments. ACIM monitors, on a daily basis, the securities segregated to ensure the fund designates a sufficient amount of liquid assets, marked-to-market daily. The fund may also receive assets or be required to pledge assets at the custodian bank or with a broker for collateral requirements.
Income Tax Status — It is the fund’s policy to distribute substantially all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code. Accordingly, no provision has been made for income taxes. The fund files U.S. federal, state, local and non-U.S. tax returns as applicable. The fund's tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years from the date of filing but can be longer in certain jurisdictions. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Distributions to Shareholders — Distributions from net investment income and net realized gains, if any, are generally declared and paid annually. The fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code, in all events in a manner consistent with provisions of the 1940 Act. The fund may elect to treat a portion of its payment to a redeeming shareholder, which represents the pro rata share of undistributed net investment income and net realized gains, as a distribution for federal income tax purposes (tax equalization).
15
Indemnifications — Under the corporation’s organizational documents, its officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business, the fund enters into contracts that provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against a fund. The risk of material loss from such claims is considered by management to be remote.
Securities Lending — Securities are lent to qualified financial institutions and brokers. State Street Bank & Trust Co. serves as securities lending agent to the fund pursuant to a Securities Lending Agreement. The lending of securities exposes the fund to risks such as: the borrowers may fail to return the loaned securities, the borrowers may not be able to provide additional collateral, the fund may experience delays in recovery of the loaned securities or delays in access to collateral, or the fund may experience losses related to the investment collateral. To minimize certain risks, loan counterparties pledge collateral in the form of cash and/or securities. The lending agent has agreed to indemnify the fund in the case of default of any securities borrowed. Cash collateral received is invested in the State Street Navigator Securities Lending Government Money Market Portfolio, a money market mutual fund registered under the 1940 Act. The loans may also be secured by U.S. government securities in an amount at least equal to the market value of the securities loaned, plus accrued interest and dividends, determined on a daily basis and adjusted accordingly. By lending securities, the fund seeks to increase its net investment income through the receipt of interest and fees. Such income is reflected separately within the Statement of Operations. The value of loaned securities and related collateral outstanding at period end, if any, are shown on a gross basis within the Schedule of Investments and Statement of Assets and Liabilities.
The following table reflects a breakdown of transactions accounted for as secured borrowings, the gross obligation by the type of collateral pledged, and the remaining contractual maturity of those transactions as of November 30, 2021.
Remaining Contractual Maturity of Agreements | |||||||||||||||||
Overnight and Continuous | <30 days | Between 30 & 90 days | >90 days | Total | |||||||||||||
Securities Lending Transactions(1) | |||||||||||||||||
Common Stocks | $ | 17,472,746 | — | — | — | $ | 17,472,746 | ||||||||||
Gross amount of recognized liabilities for securities lending transactions | $ | 17,472,746 |
(1)Amount represents the payable for cash collateral received for securities on loan. This will generally be in the Overnight and Continuous column as the securities are typically callable on demand.
3. Fees and Transactions with Related Parties
Certain officers and directors of the corporation are also officers and/or directors of American Century Companies, Inc. (ACC). The corporation’s investment advisor, ACIM, the corporation's distributor, American Century Investment Services, Inc., and the corporation’s transfer agent, American Century Services, LLC, are wholly owned, directly or indirectly, by ACC. Various funds issued by American Century Asset Allocation Portfolios, Inc. own, in aggregate, 52% of the shares of the fund. Related parties do not invest in the fund for the purpose of exercising management or control.
Management Fees — The corporation has entered into a management agreement with ACIM, under which ACIM provides the fund with investment advisory and management services in exchange for a single, unified management fee (the fee). The agreement provides that ACIM will pay all expenses of managing and operating the fund, except brokerage expenses, taxes, interest, fees and expenses of the independent directors (including legal counsel fees), and extraordinary expenses. The fee is computed and accrued daily based on the daily net assets of the fund and paid monthly in arrears. The rate of the fee is determined by applying a fee rate calculation formula. This formula takes into account the fund’s assets as well as certain assets, if any, of other clients of the investment advisor outside the American Century Investments family of funds (such as subadvised funds and separate accounts) that use very similar investment teams and strategies (strategy assets). The strategy assets of the fund also include the assets of International Growth Fund, one fund in a series issued by the corporation. The management fee schedule ranges from 0.700% to 1.150%. The investment advisor agreed to waive the fund’s management fee in its entirety. The investment advisor expects this waiver to remain in effect permanently and cannot terminate it without the approval of the Board of Directors. The effective annual management fee for the period ended November 30, 2021 was 0.84% before waiver and 0.00% after waiver.
16
Directors' Fees and Expenses — The Board of Directors is responsible for overseeing the investment advisor’s management and operations of the fund. The directors receive detailed information about the fund and its investment advisor regularly throughout the year, and meet at least quarterly with management of the investment advisor to review reports about fund operations. The fund’s officers do not receive compensation from the fund.
Interfund Transactions — The fund may enter into security transactions with other American Century Investments funds and other client accounts of the investment advisor, in accordance with the 1940 Act rules and procedures adopted by the Board of Directors. The rules and procedures require, among other things, that these transactions be effected at the independent current market price of the security. During the period, the interfund purchases and sales were $324,503 and $27,801, respectively. The effect of interfund transactions on the Statement of Operations was $(488) in net realized gain (loss) on investment transactions.
4. Investment Transactions
Purchases and sales of investment securities, excluding short-term investments, for the period ended November 30, 2021 were $756,296,784 and $718,435,932, respectively.
5. Fair Value Measurements
The fund’s investments valuation process is based on several considerations and may use multiple inputs to determine the fair value of the investments held by the fund. In conformity with accounting principles generally accepted in the United States of America, the inputs used to determine a valuation are classified into three broad levels.
•Level 1 valuation inputs consist of unadjusted quoted prices in an active market for identical investments.
•Level 2 valuation inputs consist of direct or indirect observable market data (including quoted prices for comparable investments, evaluations of subsequent market events, interest rates, prepayment speeds, credit risk, etc.). These inputs also consist of quoted prices for identical investments initially expressed in local currencies that are adjusted through translation into U.S. dollars.
•Level 3 valuation inputs consist of unobservable data (including a fund’s own assumptions).
The level classification is based on the lowest level input that is significant to the fair valuation measurement. The valuation inputs are not necessarily an indication of the risks associated with investing in these securities or other financial instruments.
The following is a summary of the level classifications as of period end. The Schedule of Investments provides additional information on the fund’s portfolio holdings.
Level 1 | Level 2 | Level 3 | |||||||||
Assets | |||||||||||
Investment Securities | |||||||||||
Common Stocks | |||||||||||
Australia | $ | 18,296,678 | $ | 39,657,459 | — | ||||||
Canada | 17,074,633 | 61,636,040 | — | ||||||||
Ireland | 30,887,553 | 20,591,224 | — | ||||||||
Israel | 14,581,368 | — | — | ||||||||
Singapore | 8,748,686 | — | — | ||||||||
Switzerland | 7,099,083 | 110,898,862 | — | ||||||||
Other Countries | — | 1,147,339,886 | — | ||||||||
Temporary Cash Investments | 29,352 | 8,578,839 | — | ||||||||
Temporary Cash Investments - Securities Lending Collateral | 17,472,746 | — | — | ||||||||
$ | 114,190,099 | $ | 1,388,702,310 | — |
17
6. Risk Factors
The value of the fund’s shares will go up and down, sometimes rapidly or unpredictably, based on the performance of the securities owned by the fund and other factors generally affecting the securities market. Market risks, including political, regulatory, economic and social developments, can affect the value of the fund’s investments. Natural disasters, public health emergencies, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse long-term effects on world economies and markets generally.
There are certain risks involved in investing in foreign securities. These risks include those resulting from political events (such as civil unrest, national elections and imposition of exchange controls), social and economic events (such as labor strikes and rising inflation), and natural disasters. Securities of foreign issuers may be less liquid and more volatile. Investing in emerging markets or a significant portion of assets in one country or region may accentuate these risks.
The fund is owned by a relatively small number of shareholders, and in the event such shareholders redeem, the ongoing operations of the fund may be at risk.
7. Federal Tax Information
On December 21, 2021, the fund declared and paid per-share distributions of $1.0663 and $0.2563 from net realized gains and net investment income, respectively to shareholders of record on December 20, 2021.
The tax character of distributions paid during the years ended November 30, 2021 and November 30, 2020 were as follows:
2021 | 2020 | |||||||
Distributions Paid From | ||||||||
Ordinary income | $ | 9,569,472 | $ | 12,393,282 | ||||
Long-term capital gains | $ | 33,569,101 | $ | 9,053,691 |
The book-basis character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements.
As of period end, the federal tax cost of investments and the components of distributable earnings on a tax-basis were as follows:
Federal tax cost of investments | $ | 1,112,740,258 | |||
Gross tax appreciation of investments | $ | 410,683,535 | |||
Gross tax depreciation of investments | (20,531,384) | ||||
Net tax appreciation (depreciation) of investments | 390,152,151 | ||||
Net tax appreciation (depreciation) on translation of assets and liabilities in foreign currencies | (545,276) | ||||
Net tax appreciation (depreciation) | $ | 389,606,875 | |||
Undistributed ordinary income | $ | 37,595,504 | |||
Accumulated long-term gains | $ | 97,348,997 |
The difference between book-basis and tax-basis unrealized appreciation (depreciation) is attributable primarily to the tax deferral of losses on wash sales.
8. Corporate Event
On December 2, 2021, the Board of Directors approved an agreement and plan of reorganization (the reorganization), whereby the net assets of the fund will be transferred to International Growth Fund, one fund in a series issued by the corporation, in exchange for shares of International Growth Fund. The financial statements and performance history of International Growth Fund will survive after the reorganization. The reorganization is expected to be completed in 2022.
18
Financial Highlights |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Operating Expenses (before expense waiver) | Net Investment Income (Loss) | Net Investment Income (Loss) (before expense waiver) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||||||
G Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $13.98 | 0.26 | 1.33 | 1.59 | (0.10) | (0.35) | (0.45) | $15.12 | 11.71% | 0.01% | 0.85% | 1.71% | 0.87% | 50% | $1,495,092 | ||||||||||||||||||||||||||||||||
2020 | $11.37 | 0.13 | 2.78 | 2.91 | (0.17) | (0.13) | (0.30) | $13.98 | 26.30% | 0.01% | 0.83% | 1.13% | 0.31% | 55% | $1,339,006 | ||||||||||||||||||||||||||||||||
2019 | $11.13 | 0.17 | 1.50 | 1.67 | (0.22) | (1.21) | (1.43) | $11.37 | 18.27% | 0.01% | 0.84% | 1.60% | 0.77% | 70% | $827,151 | ||||||||||||||||||||||||||||||||
2018 | $12.57 | 0.22 | (1.09) | (0.87) | (0.20) | (0.37) | (0.57) | $11.13 | (7.35)% | 0.01% | 0.82% | 1.75% | 0.94% | 71% | $896,239 | ||||||||||||||||||||||||||||||||
2017 | $9.61 | 0.14 | 2.91 | 3.05 | (0.09) | — | (0.09) | $12.57 | 32.02% | 0.61% | 0.91% | 1.26% | 0.96% | 57% | $1,039,845 |
Notes to Financial Highlights |
(1)Computed using average shares outstanding throughout the period.
(2)Total returns are calculated based on the net asset value of the last business day. Total returns for periods less than one year are not annualized.
See Notes to Financial Statements.
Report of Independent Registered Public Accounting Firm |
To the Shareholders and the Board of Directors of American Century World Mutual Funds, Inc.:
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of NT International Growth Fund (the “Fund”), one of the funds constituting the American Century World Mutual Funds, Inc., as of November 30, 2021, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of NT International Growth Fund of the American Century World Mutual Funds, Inc. as of November 30, 2021, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund’s financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. 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, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of November 30, 2021, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
/s/ Deloitte & Touche LLP
Kansas City, Missouri
January 19, 2022
We have served as the auditor of one or more American Century investment companies since 1997.
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Management |
The Board of Directors
The individuals listed below serve as directors of the funds. Each director will continue to serve in this capacity until death, retirement, resignation or removal from office. The board has adopted a mandatory retirement age for directors who are not “interested persons,” as that term is defined in the Investment Company Act (independent directors). Independent directors shall retire by December 31 of the year in which they reach their 75th birthday.
Jonathan S. Thomas is an “interested person” because he currently serves as President and Chief Executive Officer of American Century Companies, Inc. (ACC), the parent company of American Century Investment Management, Inc. (ACIM or the advisor). The other directors (more than three-fourths of the total number) are independent. They are not employees, directors or officers of, and have no financial interest in, ACC or any of its wholly owned, direct or indirect, subsidiaries, including ACIM, American Century Investment Services, Inc. (ACIS) and American Century Services, LLC (ACS), and they do not have any other affiliations, positions or relationships that would cause them to be considered “interested persons” under the Investment Company Act. The directors serve in this capacity for seven (in the case of Jonathan S. Thomas, 16; and Stephen E. Yates, 8) registered investment companies in the American Century Investments family of funds.
The following table presents additional information about the directors. The mailing address for each director is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Thomas W. Bunn (1953) | Director | Since 2017 | Retired | 72 | SquareTwo Financial; Barings (formerly Babson Capital Funds Trust) (2013 to 2016) | ||||||||||||
Chris H. Cheesman (1962) | Director | Since 2019 | Retired. Senior Vice President & Chief Audit Executive, AllianceBernstein (1999 to 2018) | 72 | Alleghany Corporation | ||||||||||||
Barry Fink (1955) | Director | Since 2012 (independent since 2016) | Retired | 72 | None | ||||||||||||
Rajesh K. Gupta (1960) | Director | Since 2019 | Partner Emeritus, SeaCrest Investment Management and SeaCrest Wealth Management (2019 to Present); Chief Executive Officer and Chief Investment Officer, SeaCrest Investment Management (2006 to 2019); Chief Executive Officer and Chief Investment Officer, SeaCrest Wealth Management (2008 to 2019) | 72 | None |
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Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Lynn Jenkins (1963) | Director | Since 2019 | Consultant, LJ Strategies (2019 to present); United States Representative, U.S. House of Representatives (2009 to 2018) | 72 | MGP Ingredients, Inc. (2019 to 2021) | ||||||||||||
Jan M. Lewis (1957) | Director | Since 2011 | Retired | 72 | None | ||||||||||||
John R. Whitten(1) (1946) | Director | Since 2008 | Retired | 72 | Onto Innovation Inc. (2019 to 2020); Rudolph Technologies, Inc. (2006 to 2019) | ||||||||||||
Stephen E. Yates (1948) | Director and Chairman of the Board | Since 2012 (Chairman since 2018) | Retired | 108 | None | ||||||||||||
Interested Director | |||||||||||||||||
Jonathan S. Thomas (1963) | Director | Since 2007 | President and Chief Executive Officer, ACC (2007 to present). Also serves as Chief Executive Officer, ACS; Director, ACC and other ACC subsidiaries | 146 | None |
(1) Effective December 31, 2021, John R. Whitten retired from the Board of Directors.
The Statement of Additional Information has additional information about the fund's directors and is available without charge, upon request, by calling 1-800-345-2021.
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Officers
The following table presents certain information about the executive officers of the funds. Each officer serves as an officer for each of the 16 (in the case of Robert J. Leach, 15) investment companies in the American Century family of funds. No officer is compensated for his or her service as an officer of the funds. The listed officers are interested persons of the funds and are appointed or re-appointed on an annual basis. The mailing address for each officer listed below is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Offices with the Funds | Principal Occupation(s) During the Past Five Years | ||||||
Patrick Bannigan (1965) | President since 2019 | Executive Vice President and Director, ACC (2012 to present); Chief Financial Officer, Chief Accounting Officer and Treasurer, ACC (2015 to present). Also serves as President, ACS; Vice President, ACIM; Chief Financial Officer, Chief Accounting Officer and/or Director, ACIM, ACS and other ACC subsidiaries | ||||||
R. Wes Campbell (1974) | Chief Financial Officer and Treasurer since 2018 | Vice President, ACS, (2020 to present); Investment Operations and Investment Accounting, ACS (2000 to present) | ||||||
Amy D. Shelton (1964) | Chief Compliance Officer and Vice President since 2014 | Chief Compliance Officer, American Century funds, (2014 to present); Chief Compliance Officer, ACIM (2014 to present); Chief Compliance Officer, ACIS (2009 to present). Also serves as Vice President, ACIS | ||||||
John Pak (1968) | General Counsel and Senior Vice President since 2021 | General Counsel and Senior Vice President, ACC (2021 to present). Also serves as General Counsel and Senior Vice President, ACIM, ACS and ACIS. Chief Legal Officer of Investment and Wealth Management, The Bank of New York Mellon (2014 to 2021) | ||||||
C. Jean Wade (1964) | Vice President since 2012 | Senior Vice President, ACS (2017 to present); Vice President, ACS (2000 to 2017) | ||||||
Robert J. Leach (1966) | Vice President since 2006 | Vice President, ACS (2000 to present) | ||||||
David H. Reinmiller (1963) | Vice President since 2000 | Attorney, ACC (1994 to present). Also serves as Vice President, ACIM and ACS | ||||||
Ward D. Stauffer (1960) | Secretary since 2005 | Attorney, ACC (2003 to present) |
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Approval of Management Agreement |
At a meeting held on June 30, 2021, the Fund’s Board of Directors (the "Board") unanimously approved the renewal of the management agreement pursuant to which American Century Investment Management, Inc. (the “Advisor”) acts as the investment advisor for the Fund. Under Section 15(c) of the Investment Company Act, contracts for investment advisory services are required to be reviewed, evaluated, and approved by a majority of a fund��s directors (the “Directors”), including a majority of the independent Directors, each year.
Prior to its consideration of the renewal of the management agreement, the Directors requested and reviewed extensive data and information compiled by the Advisor and certain independent providers of evaluation data concerning the Fund and the services provided to the Fund by the Advisor. This review was in addition to the oversight and evaluation undertaken by the Board and its committees on a continual basis and the information received was supplemental to the extensive information that the Board and its committees receive and consider throughout the year.
In connection with its consideration of the renewal of the management agreement, the Board’s review and evaluation of the services provided by the Advisor and its affiliates included, but was not limited to, the following:
•the nature, extent, and quality of investment management, shareholder services, and other services provided and to be provided to the Fund including without limitation portfolio management and trading services, shareholder and intermediary services, compliance and legal services, fund accounting and financial reporting, and fund share distribution;
•the wide range of other programs and services provided and to be provided to the Fund and its shareholders on a routine and non-routine basis;
•the Fund’s investment performance, including data comparing the Fund's performance to appropriate benchmarks and/or a peer group of other mutual funds with similar investment objectives and strategies;
•the cost of owning the Fund compared to the cost of owning similar funds;
•the compliance policies, procedures, and regulatory experience of the Advisor and the Fund's service providers;
•the Advisor’s strategic plans, COVID-19 pandemic response, vendor management practices, and social justice initiatives;
•the Advisor’s business continuity plans and cyber security practices;
•financial data showing the cost of services provided to the Fund, the profitability of the Fund to the Advisor, and the overall profitability of the Advisor;
•possible economies of scale associated with the Advisor’s management of the Fund and other accounts;
•services provided and charges to the Advisor's other investment management clients;
•acquired fund fees and expenses;
•payments and practices in connection with financial intermediaries holding shares of the Fund and the services provided by intermediaries in connection therewith; and
•possible collateral benefits to the Advisor from the management of the Fund.
The Board held two meetings to consider the renewal. The independent Directors also met in private session three times to review and discuss the information provided in response to their request. The independent Directors held active discussions with the Advisor regarding the renewal of the management agreement, requesting supplemental information, and reviewing information provided by the Advisor in response thereto. The independent Directors had the benefit of the advice of their independent counsel throughout the process.
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Factors Considered
The Directors considered all of the information provided by the Advisor, the independent data providers, and independent counsel in connection with the approval. They determined that the information was sufficient for them to evaluate the management agreement for the Fund. In connection with their review, the Directors did not identify any single factor as being all-important or controlling, and each Director may have attributed different levels of importance to different factors. In deciding to renew the management agreement, the Board based its decision on a number of factors, including without limitation the following:
Nature, Extent and Quality of Services — Generally. Under the management agreement, the Advisor is responsible for providing or arranging for all services necessary for the operation of the Fund. The Board noted that the Advisor provides or arranges at its own expense a wide variety of services which include the following:
•constructing and designing the Fund
•portfolio research and security selection
•initial capitalization/funding
•securities trading
•Fund administration
•custody of Fund assets
•daily valuation of the Fund’s portfolio
•liquidity monitoring and management
•risk management, including cyber security
•shareholder servicing and transfer agency, including shareholder confirmations, recordkeeping, and communications
•legal services (except the independent Directors’ counsel)
•regulatory and portfolio compliance
•financial reporting
•marketing and distribution (except amounts paid by the Fund under Rule 12b-1 plans)
The Board noted that many of these services have expanded over time in terms of both quantity and complexity in response to shareholder demands, competition in the industry, changing distribution channels, and the changing regulatory environment.
Investment Management Services. The nature of the investment management services provided to the Fund is quite complex and allows Fund shareholders access to professional money management, instant diversification of their investments within an asset class, the opportunity to easily diversify among asset classes by investing in or exchanging among various American Century Investments funds, and liquidity. In evaluating investment performance, the Board expects the Advisor to manage the Fund in accordance with its investment objectives and approved strategies. Further, the Directors recognize that the Advisor has an obligation to monitor trading activities, and in particular to seek the best execution of fund trades, and to evaluate the use of and payment for research. In providing these services, the Advisor utilizes teams of investment professionals (portfolio managers, analysts, research assistants, and securities traders) who require extensive information technology, research, training, compliance, and other systems to conduct their business. The Board, directly and through its Fund Performance Review Committee, provides oversight of the investment performance process. It regularly reviews investment performance information for the Fund, together with comparative information for appropriate benchmarks and/or peer groups of similarly-managed funds, over different time horizons. The Directors also review investment performance information during the management agreement renewal process. If performance concerns are identified, the Fund receives special reviews until performance improves, during which the Board discusses with the Advisor the reasons for such results (e.g., market conditions, security selection) and any efforts being undertaken to improve performance. The Fund’s performance was above its benchmark for the one-, three-, five-, and ten-year periods reviewed by the Board. The Board found the investment management services provided by the Advisor to the Fund to be satisfactory and consistent with the management agreement.
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Shareholder and Other Services. Under the management agreement, the Advisor provides the Fund with a comprehensive package of transfer agency, shareholder, and other services. The Board, directly and through its various committees, regularly reviews reports and evaluations of such services at its regular meetings. These reports include, but are not limited to, information regarding the operational efficiency and accuracy of the shareholder and transfer agency services provided, staffing levels, shareholder satisfaction, technology support (including cyber security), new products and services offered to Fund shareholders, securities trading activities, portfolio valuation services, auditing services, and legal and operational compliance activities. The Board found the services provided by the Advisor to the Fund under the management agreement to be competitive and of high quality.
Costs of Services and Profitability. The Advisor provides detailed information concerning its cost of providing various services to the Fund, its profitability in managing the Fund (pre- and post-distribution), its overall profitability, and its financial condition. The Directors have reviewed with the Advisor the methodology used to prepare this financial information. This information is considered in evaluating the Advisor’s financial condition, its ability to continue to provide services under the management agreement, and the reasonableness of the current management fee. The Board concluded that the Advisor’s profits were reasonable in light of the services provided to the Fund.
Ethics. The Board generally considers the Advisor’s commitment to providing quality services to shareholders and to conducting its business ethically. They noted that the Advisor’s practices generally meet or exceed industry best practices.
Economies of Scale. The Board also reviewed information provided by the Advisor regarding the possible existence of economies of scale in connection with the management of the Fund. The Board concluded that economies of scale are difficult to measure and predict with precision, especially on a fund-by-fund basis. The Board concluded that the Advisor is sharing economies of scale, to the extent they exist, through its competitive fee structure, offering competitive fees from fund inception, and through reinvestment in its business, infrastructure, investment capabilities and initiatives to provide shareholders additional content and services.
Comparison to Other Funds’ Fees. The management agreement provides that the Fund pays the Advisor a single, all-inclusive (or unified) management fee for providing all services necessary for the management and operation of the Fund, other than brokerage expenses, expenses attributable to short sales, taxes, interest, extraordinary expenses, fees and expenses of the Fund’s independent Directors (including their independent legal counsel), and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the Investment Company Act. Under the unified fee structure, the Advisor is responsible for providing all investment advisory, custody, audit, administrative, compliance, recordkeeping, marketing and shareholder services, or arranging and supervising third parties to provide such services. By contrast, most other funds are charged a variety of fees, including an investment advisory fee, a transfer agency fee, an administrative fee, distribution charges, and other expenses. Other than their investment advisory fees and any applicable Rule 12b-1 distribution fees, all other components of the total fees charged by these other funds may be increased without shareholder approval. The Board believes the unified fee structure is a benefit to Fund shareholders because it clearly discloses to shareholders the cost of owning Fund shares, and, since the unified fee cannot be increased without a vote of Fund shareholders, it shifts to the Advisor the risk of increased costs of operating the Fund and provides a direct incentive to minimize administrative inefficiencies. Part of the Board’s analysis of fee levels involves reviewing certain evaluative data compiled by an independent provider comparing the Fund’s unified fee to the total expense ratios of its peers. The unified fee charged to shareholders of the Fund was below the median of the total expense ratios of the Fund’s peer expense universe. In addition, the Board reviewed the Fund’s position relative to the narrower set of its expense group peers. The Board concluded that the management fee paid by the Fund to the Advisor under the management agreement is reasonable in light of the services provided to the Fund.
Comparison to Fees and Services Provided to Other Clients of the Advisor. The Board also requested and received information from the Advisor concerning the nature of the services, fees, costs, and profitability of its advisory services to advisory clients other than the Fund. They observed that these varying types of client accounts require different services and involve different
26
regulatory and entrepreneurial risks than the management of the Fund. The Board analyzed this information and concluded that the fees charged and services provided to the Fund were reasonable by comparison.
Payments to Intermediaries. The Directors also requested and received a description of payments made to intermediaries by the Fund and the Advisor and services provided in response thereto. These payments include various payments made by the Fund or the Advisor to different types of intermediaries and recordkeepers for distribution and service activities provided for the Fund. The Directors reviewed such information and received representations from the Advisor that all such payments by the Fund were made pursuant to the Fund's Rule 12b-1 Plan and that all such payments by the Advisor were made from the Advisor’s resources and reasonable profits. The Board found such payments to be reasonable in scope and purpose.
Collateral or “Fall-Out” Benefits Derived by the Advisor. The Board considered the possible existence of collateral benefits the Advisor may receive as a result of its relationship with the Fund. They concluded that the Advisor’s primary business is managing funds and it generally does not use fund or shareholder information to generate profits in other lines of business, and therefore does not derive any significant collateral benefits from them. To the extent there are potential collateral benefits, the Board has been advised and has taken this into consideration in its review of the management contract with the Fund. The Board noted that additional assets from other clients may offer the Advisor some benefit from increased leverage with service providers and counterparties. Additionally, the Advisor may receive proprietary research from broker-dealers that execute fund portfolio transactions, which the Board concluded is likely to benefit other clients of the Advisor, as well as Fund shareholders. The Board also determined that the Advisor is able to provide investment management services to certain clients other than the Fund, at least in part, due to its existing infrastructure built to serve the fund complex. The Board concluded that appropriate allocation methodologies had been employed to assign resources and the cost of those resources to these other clients.
Existing Relationship. The Board also considered whether there was any reason for not continuing the existing arrangement with the Advisor. In this regard, the Board was mindful of the potential disruptions of the Fund’s operations and various risks, uncertainties, and other effects that could occur as a result of a decision not to continue such relationship. In particular, the Board recognized that most shareholders have invested in the Fund on the strength of the Advisor’s industry standing and reputation and in the expectation that the Advisor will have a continuing role in providing advisory services to the Fund.
Conclusion of the Directors. As a result of this process, the Board, including all of the independent Directors, taking into account all of the factors discussed above and the information provided by the Advisor and others in connection with its review and throughout the year, determined that the management fee is fair and reasonable in light of the services provided and that the investment management agreement between the Fund and the Advisor should be renewed.
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Additional Information |
Retirement Account Information
As required by law, distributions you receive from certain retirement accounts are subject to federal income tax withholding, unless you elect not to have withholding apply*. Tax will be withheld on the total amount withdrawn even though you may be receiving amounts that are not subject to withholding, such as nondeductible contributions. In such case, excess amounts of withholding could occur. You may adjust your withholding election so that a greater or lesser amount will be withheld.
If you don’t want us to withhold on this amount, you must notify us to not withhold the federal income tax. You may notify us in writing or in certain situations by telephone or through other electronic means. For systematic withdrawals, your withholding election will remain in effect until revoked or changed by filing a new election. You have the right to revoke your election at any time and change your withholding percentage for future distributions.
Remember, even if you elect not to have income tax withheld, you are liable for paying income tax on the taxable portion of your withdrawal. If you elect not to have income tax withheld or you don’t have enough income tax withheld, you may be responsible for payment of estimated tax. You may incur penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. You can reduce or defer the income tax on a distribution by directly or indirectly rolling such distribution over to another IRA or eligible plan. You should consult your tax advisor for additional information.
State tax will be withheld if, at the time of your distribution, your address is within one of the mandatory withholding states and you have federal income tax withheld (or as otherwise required by state law). State taxes will be withheld from your distribution in accordance with the respective state rules.
*Some 403(b), 457 and qualified retirement plan distributions may be subject to 20% mandatory withholding, as they are subject to special tax and withholding rules. Your plan administrator or plan sponsor is required to provide you with a special tax notice explaining those rules at the time you request a distribution. If applicable, federal and/or state taxes may be withheld from your distribution amount.
Proxy Voting Policies
A description of the policies that the fund's investment advisor uses in exercising the voting rights associated with the securities purchased and/or held by the fund is available without charge, upon request, by calling 1-800-345-2021. It is also available on American Century Investments’ website at americancentury.com/proxy and on the Securities and Exchange Commission’s website at sec.gov. Information regarding how the investment advisor voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on americancentury.com/proxy. It is also available at sec.gov.
Quarterly Portfolio Disclosure
The fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. These portfolio holdings are available on the fund's website at americancentury.com and, upon request, by calling 1-800-345-2021. The fund’s Form N-PORT reports are available on the SEC’s website at sec.gov.
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Other Tax Information
The following information is provided pursuant to provisions of the Internal Revenue Code.
The fund hereby designates up to the maximum amount allowable as qualified dividend income for the fiscal year ended November 30, 2021.
The fund hereby designates $38,315,631, or up to the maximum amount allowable, as long-term capital gain distributions (20% rate gain distributions) for the fiscal year ended November 30, 2021.
The fund hereby designates $557,318 as qualified short-term capital gain distributions for purposes of Internal Revenue Code Section 871 for the fiscal year ended November 30, 2021.
For the fiscal year ended November 30, 2021, the fund intends to pass through to shareholders foreign source income of $27,317,563 and foreign taxes paid of $2,224,233, or up to the maximum amount allowable, as a foreign tax credit. Foreign source income and foreign tax expense per outstanding share on November 30, 2021 are $0.2763 and $0.0225, respectively.
The fund utilized earnings and profits of $6,688,042 distributed to shareholders on redemption of shares as part of the dividends paid deduction (tax equalization).
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Notes |
30
Notes |
31
Notes |
32
![]() | ||||||||
Contact Us | americancentury.com | |||||||
Automated Information Line | 1-800-345-8765 | |||||||
Investor Services Representative | 1-800-345-2021 or 816-531-5575 | |||||||
Investors Using Advisors | 1-800-378-9878 | |||||||
Business, Not-For-Profit, Employer-Sponsored Retirement Plans | 1-800-345-3533 | |||||||
Banks and Trust Companies, Broker-Dealers, Financial Professionals, Insurance Companies | 1-800-345-6488 | |||||||
Telecommunications Relay Service for the Deaf | 711 | |||||||
American Century World Mutual Funds, Inc. | ||||||||
Investment Advisor: American Century Investment Management, Inc. Kansas City, Missouri | ||||||||
This report and the statements it contains are submitted for the general information of our shareholders. The report is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. | ||||||||
©2022 American Century Proprietary Holdings, Inc. All rights reserved. CL-ANN-91024 2201 |
![image37.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image37.jpg)
Annual Report | |||||
November 30, 2021 | |||||
NT International Small-Mid Cap Fund | |||||
Investor Class (ANTSX) | |||||
G Class (ANTMX) |
Table of Contents |
Performance | |||||
Portfolio Commentary | |||||
Fund Characteristics | |||||
Shareholder Fee Example | |||||
Schedule of Investments | |||||
Statement of Assets and Liabilities | |||||
Statement of Operations | |||||
Statement of Changes in Net Assets | |||||
Notes to Financial Statements | |||||
Financial Highlights | |||||
Report of Independent Registered Public Accounting Firm | |||||
Management | |||||
Approval of Management Agreement | |||||
Additional Information |
Any opinions expressed in this report reflect those of the author as of the date of the report, and do not necessarily represent the opinions of American Century Investments® or any other person in the American Century Investments organization. Any such opinions are subject to change at any time based upon market or other conditions and American Century Investments disclaims any responsibility to update such opinions. These opinions may not be relied upon as investment advice and, because investment decisions made by American Century Investments funds are based on numerous factors, may not be relied upon as an indication of trading intent on behalf of any American Century Investments fund. Security examples are used for representational purposes only and are not intended as recommendations to purchase or sell securities. Performance information for comparative indices and securities is provided to American Century Investments by third party vendors. To the best of American Century Investments’ knowledge, such information is accurate at the time of printing.
Performance |
Total Returns as of November 30, 2021 | |||||||||||||||||
Average Annual Returns | |||||||||||||||||
Ticker Symbol | 1 year | 5 years | Since Inception | Inception Date | |||||||||||||
Investor Class | ANTSX | 17.70% | 13.94% | 10.14% | 3/19/15 | ||||||||||||
MSCI EAFE Small Cap Index | — | 12.70% | 10.71% | 8.53% | — | ||||||||||||
G Class | ANTMX | 19.45% | 15.43% | 11.26% | 3/19/15 |
Fund returns would have been lower if a portion of the fees had not been waived.
Growth of $10,000 Over Life of Class | ||
$10,000 investment made March 19, 2015 | ||
Performance for other share classes will vary due to differences in fee structure. |
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Value on November 30, 2021 | |||||
Investor Class — $19,113 | |||||
MSCI EAFE Small Cap Index — $17,313 | |||||
Ending value of Investor Class would have been lower if a portion of the fees had not been waived.
Total Annual Fund Operating Expenses | |||||
Investor Class | G Class | ||||
1.48% | 1.13% |
The total annual fund operating expenses shown is as stated in the fund’s prospectus current as of the date of this report. The prospectus may vary from the expense ratio shown elsewhere in this report because it is based on a different time period, includes acquired fund fees and expenses, and, if applicable, does not include fee waivers or expense reimbursements.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
2
Portfolio Commentary |
Portfolio Managers: Trevor Gurwich, Federico Laffan and Pratik Patel
Performance Summary
NT International Small-Mid Cap returned 19.45%* for the 12 months ended November 30, 2021, outperforming the MSCI EAFE Small Cap Index, which returned 12.70% for the same period.
Stocks rose strongly in late 2020, as progress toward COVID-19 vaccines raised hopes for easing lockdown measures and a global economic resurgence. Market leadership shifted away from the defensive, stay-at-home stocks that outperformed through much of 2020 toward more cyclically oriented names expected to benefit from a move toward normal. This market broadening continued through the first half of 2021 as the distribution of vaccines and the lifting of COVID-19 restrictions in many countries led to improved economic growth and robust corporate earnings. The market faced some headwinds in the second quarter of 2021, however, as companies reported challenges with supply chain bottlenecks, worker shortages and increased commodity prices. These pressures escalated in the third quarter, leading to increased market turbulence, as inflation fears and expectations for less accommodative monetary policy drove interest rates higher. New virus variants and vaccine rollout delays also complicated reopening plans in some countries. Developments in China, including regulatory uncertainty and a liquidity crisis in the property sector, also contributed to market volatility. Nonetheless, non-U.S. small-cap stocks ended the 12-month period with strong performance, while outperforming large caps.
Stock selection, especially in health care and information technology, drove the fund’s strong relative outperformance over the 12-month period. Stock selection in industrials and financials detracted from relative performance. From a geographic standpoint, stock selection in the U.K. assisted relative performance, while stock selection in Japan dampened relative performance.
Medical Technology Company Was a Top Contributor
Inmode was a standout contributor in the health care sector. This medical technology company provides minimally invasive solutions for cosmetic and other surgeries. It reported strong revenue and earnings growth, as the vaccine rollout reduced virus fears and unleashed pent-up demand for elective medical procedures.
The ongoing drive toward digitalization fueled strong results for Endava, another top contributor. This digitally focused information technology services company benefited from robust trends in end markets such as electronic payments, insurance technology, media and telecommunications.
Improved consumer spending trends and the expansion of e-commerce supported strong stock performance for consumer discretionary holdings such as Watches of Switzerland Group. This multichannel retailer of high-end Swiss watches augmented its business through its acquisition of Rolex agency stores in the U.S. It also reported strong revenue and earnings growth.
Detractors Included Industrial Gas Producer and Digital Gaming Studio
Several stocks that were strong contributors in 2020 gave back ground over the 12-month period. Industrial gas supplier Nippon Gas was a notable detractor. The company reported weaker-than-expected results, but left its full-year forecasts unchanged. The company tends to be able to pass through rising input costs to its customers, but there typically is a lag before pricing offsets rising costs.
*All fund returns referenced in this commentary are for G Class shares. G Class returns would have been lower if a portion of the fees had not been waived. Performance for other share classes will vary due to differences in fee structure; when G Class exceeds that of the fund’s benchmark, other share classes may not. See page 2 for returns for all share classes.
3
Optimism over reopening also led to a sell-off in companies viewed as beneficiaries of the stay-at-home period. These included Stillfront Group, the owner of a digital gaming studio that experienced strong business trends during the pandemic. On the other hand, ASKUL, a Japan-based retailer of computer equipment, office supplies and logistics services, was negatively impacted by a slower-than-expected return to the office in Japan. We liquidated both holdings as we sought investments with more attractive earnings growth potential.
Outlook
Despite near-term economic uncertainty, we believe the portfolio remains well positioned, supported by a broad array of stocks with strong company-specific drivers. While we have exposure to companies positioned to benefit from improved global economic growth, we remain balanced between reopening names and beneficiaries of long-term changes in behavior.
We hold a notable overweight in consumer discretionary, with a focus on companies we believe have sustainable earnings growth potential. Many consumer-facing companies saw strong revenue growth during the pandemic. As valuations increased, we sought opportunities in other sectors, such as health care, where we have found investments that we believe will deliver accelerating and sustainable earnings growth.
We also continue to see opportunities in information technology, which is prominently weighted in the portfolio. These include companies capitalizing on long-term secular trends such as digitalization, cloud computing, automation and software as a service. We believe supply chain disruptions and ongoing uncertainty over virus variants have helped accelerate many of these trends. The fund is underweight in real estate and materials, sectors where we have found fewer compelling investments.
From a regional standpoint, our bottom-up stock selection has led to an overweight in Europe. The fund is underweight in Asia, including Japan, reflecting the mix of investment opportunities we have found there.
4
Fund Characteristics |
NOVEMBER 30, 2021 | |||||
Types of Investments in Portfolio | % of net assets | ||||
Common Stocks | 98.2% | ||||
Exchange-Traded Funds | —* | ||||
Temporary Cash Investments | 1.7% | ||||
Temporary Cash Investments - Securities Lending Collateral | 0.2% | ||||
Other Assets and Liabilities | (0.1)% | ||||
*Category is less than 0.05% of total net assets. | |||||
Top Five Countries* | % of net assets | ||||
Japan | 20.4% | ||||
United Kingdom | 17.6% | ||||
Canada | 9.7% | ||||
Australia | 6.9% | ||||
Sweden | 6.1% |
*Exposure indicated excludes Exchange-Traded Funds. The Schedule of Investments provides additional information on the fund's portfolio holdings.
5
Shareholder Fee Example |
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption/exchange fees; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in your fund and to compare these costs with the ongoing cost of investing in other mutual funds.
The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period from May 29, 2021 to November 30, 2021.
Actual Expenses
The table provides information about actual account values and actual expenses for each class. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. First, identify the share class you own. Then simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The table also provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each class of your fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of a fund’s share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption/exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Beginning Account Value 5/29/21 | Ending Account Value 11/30/21 | Expenses Paid During Period(1) 5/29/21 - 11/30/21 | Annualized Expense Ratio(1) | |||||||||||
Actual | ||||||||||||||
Investor Class | $1,000 | $996.70 | $7.33 | 1.44% | ||||||||||
G Class | $1,000 | $1,003.90 | $0.05 | 0.01% | ||||||||||
Hypothetical | ||||||||||||||
Investor Class | $1,000 | $1,018.14 | $7.40 | 1.44% | ||||||||||
G Class | $1,000 | $1,025.43 | $0.05 | 0.01% |
(1)Expenses are equal to the class's annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 186, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. Annualized expense ratio reflects actual expenses, including any applicable fee waivers or expense reimbursements and excluding any acquired fund fees and expenses.
6
Schedule of Investments |
NOVEMBER 30, 2021
Shares | Value | |||||||
COMMON STOCKS — 98.2% | ||||||||
Australia — 6.9% | ||||||||
carsales.com Ltd. | 251,490 | $ | 4,466,503 | |||||
City Chic Collective Ltd.(1) | 1,223,826 | 5,188,804 | ||||||
Corporate Travel Management Ltd.(1) | 344,687 | 5,388,846 | ||||||
IDP Education Ltd. | 254,018 | 6,262,741 | ||||||
Mineral Resources Ltd. | 118,835 | 3,813,753 | ||||||
NEXTDC Ltd.(1) | 687,820 | 5,835,173 | ||||||
OZ Minerals Ltd. | 323,156 | 5,943,012 | ||||||
36,898,832 | ||||||||
Austria — 0.6% | ||||||||
ANDRITZ AG | 68,431 | 3,266,271 | ||||||
Belgium — 1.7% | ||||||||
D'ieteren Group | 48,863 | 8,915,076 | ||||||
Canada — 9.7% | ||||||||
BRP, Inc. | 48,609 | 3,841,688 | ||||||
Canadian Western Bank | 181,795 | 5,256,963 | ||||||
Colliers International Group, Inc. (Toronto) | 41,339 | 5,580,903 | ||||||
Descartes Systems Group, Inc. (The)(1) | 66,315 | 5,331,883 | ||||||
FirstService Corp. | 15,762 | 3,029,630 | ||||||
goeasy Ltd.(2) | 27,977 | 3,806,116 | ||||||
Kinaxis, Inc.(1) | 33,292 | 5,088,468 | ||||||
Nuvei Corp.(1) | 29,267 | 2,884,555 | ||||||
TFI International, Inc. | 47,211 | 4,687,654 | ||||||
Tricon Residential, Inc. (Toronto) | 495,586 | 6,804,633 | ||||||
Whitecap Resources, Inc.(2) | 1,106,105 | 5,887,913 | ||||||
52,200,406 | ||||||||
Denmark — 4.1% | ||||||||
ALK-Abello A/S(1) | 11,926 | 5,986,917 | ||||||
Jyske Bank A/S(1) | 119,861 | 5,994,156 | ||||||
Pandora A/S | 44,407 | 5,525,226 | ||||||
Royal Unibrew A/S | 42,547 | 4,534,715 | ||||||
22,041,014 | ||||||||
Finland — 2.0% | ||||||||
Cargotec Oyj, B Shares | 37,611 | 1,757,395 | ||||||
Metso Outotec Oyj | 424,730 | 4,280,387 | ||||||
Musti Group Oyj(1) | 145,022 | 4,916,097 | ||||||
10,953,879 | ||||||||
France — 5.8% | ||||||||
Alten SA | 36,236 | 5,989,415 | ||||||
APERAM SA | 67,893 | 3,262,149 | ||||||
Elis SA(1) | 295,884 | 4,644,102 | ||||||
Euronext NV | 54,092 | 5,315,083 | ||||||
Nexans SA | 57,374 | 5,303,546 | ||||||
SOITEC(1) | 12,382 | 3,260,129 | ||||||
Wendel SE | 27,058 | 3,093,864 | ||||||
30,868,288 |
7
Shares | Value | |||||||
Germany — 2.9% | ||||||||
AIXTRON SE | 123,800 | $ | 2,488,090 | |||||
CTS Eventim AG & Co. KGaA(1) | 59,271 | 3,851,815 | ||||||
Dermapharm Holding SE | 58,142 | 5,342,511 | ||||||
Eckert & Ziegler Strahlen- und Medizintechnik AG | 33,080 | 3,642,895 | ||||||
15,325,311 | ||||||||
Ireland — 1.4% | ||||||||
AIB Group plc(1) | 2,286,080 | 5,009,018 | ||||||
Glanbia plc | 178,417 | 2,306,379 | ||||||
7,315,397 | ||||||||
Israel — 3.4% | ||||||||
Inmode Ltd.(1) | 57,474 | 4,368,024 | ||||||
Kornit Digital Ltd.(1) | 44,038 | 6,821,927 | ||||||
Nova Ltd.(1) | 53,751 | 6,909,691 | ||||||
18,099,642 | ||||||||
Italy — 3.0% | ||||||||
Autogrill SpA(1) | 693,659 | 4,483,348 | ||||||
MARR SpA | 212,956 | 4,313,637 | ||||||
Sesa SpA | 35,646 | 7,090,115 | ||||||
15,887,100 | ||||||||
Japan — 20.4% | ||||||||
Amvis Holdings, Inc. | 66,000 | 6,405,927 | ||||||
Asics Corp. | 196,400 | 4,863,149 | ||||||
BayCurrent Consulting, Inc. | 8,900 | 3,677,639 | ||||||
Calbee, Inc. | 116,100 | 2,608,462 | ||||||
en Japan, Inc. | 116,100 | 3,611,122 | ||||||
ENECHANGE Ltd.(1) | 34,800 | 2,148,867 | ||||||
Food & Life Cos. Ltd. | 160,500 | 6,796,764 | ||||||
Hennge KK(1) | 43,300 | 1,612,267 | ||||||
IHI Corp. | 239,900 | 4,482,034 | ||||||
Japan Elevator Service Holdings Co. Ltd. | 265,700 | 4,957,666 | ||||||
Japan Hotel REIT Investment Corp. | 2,908 | 1,503,953 | ||||||
JTOWER, Inc.(1) | 57,800 | 5,215,825 | ||||||
m-up Holdings, Inc. | 81,700 | 3,085,576 | ||||||
MatsukiyoCocokara & Co. | 136,800 | 5,355,106 | ||||||
Menicon Co. Ltd. | 110,000 | 3,639,989 | ||||||
Nextage Co. Ltd. | 368,400 | 7,399,770 | ||||||
Nippon Gas Co. Ltd. | 143,600 | 1,789,265 | ||||||
Open House Co. Ltd. | 72,900 | 4,132,103 | ||||||
Outsourcing, Inc. | 214,500 | 2,829,740 | ||||||
Relo Group, Inc. | 202,900 | 3,733,746 | ||||||
Sanwa Holdings Corp. | 371,600 | 3,964,035 | ||||||
Simplex Holdings, Inc.(1) | 111,700 | 2,757,049 | ||||||
Ushio, Inc. | 276,400 | 5,120,411 | ||||||
Visional, Inc.(1) | 75,600 | 5,438,350 | ||||||
West Holdings Corp. | 112,200 | 6,419,662 | ||||||
Zenkoku Hosho Co. Ltd. | 138,500 | 6,043,875 | ||||||
109,592,352 | ||||||||
Netherlands — 5.6% | ||||||||
Accell Group NV(1) | 34,114 | 1,497,885 | ||||||
Arcadis NV | 153,129 | 6,809,176 | ||||||
ASM International NV | 6,145 | 2,762,130 |
8
Shares | Value | |||||||
ASR Nederland NV | 123,617 | $ | 5,279,104 | |||||
Basic-Fit NV(1)(2) | 110,292 | 4,786,864 | ||||||
BE Semiconductor Industries NV | 61,148 | 5,814,552 | ||||||
OCI NV(1) | 113,118 | 3,097,422 | ||||||
30,047,133 | ||||||||
Norway — 1.3% | ||||||||
Bakkafrost P/F | 39,539 | 2,596,744 | ||||||
Storebrand ASA | 501,600 | 4,608,546 | ||||||
7,205,290 | ||||||||
Singapore — 0.4% | ||||||||
TDCX, Inc., ADR(1) | 116,651 | 2,216,369 | ||||||
Spain — 1.6% | ||||||||
CIE Automotive SA | 95,464 | 2,650,728 | ||||||
Laboratorios Farmaceuticos Rovi SA | 84,362 | 6,149,065 | ||||||
8,799,793 | ||||||||
Sweden — 6.1% | ||||||||
AddTech AB, B Shares | 220,479 | 5,012,074 | ||||||
Arjo AB, B Shares | 524,956 | 6,598,702 | ||||||
Fastighets AB Balder, B Shares(1) | 74,653 | 5,576,356 | ||||||
Hexatronic Group AB | 76,507 | 4,255,879 | ||||||
Lifco AB, B Shares | 105,475 | 2,850,489 | ||||||
Nordic Entertainment Group AB, B Shares(1) | 95,937 | 4,764,301 | ||||||
Storytel AB(1)(2) | 45,817 | 847,768 | ||||||
Vitrolife AB | 48,070 | 2,940,982 | ||||||
32,846,551 | ||||||||
Switzerland — 3.7% | ||||||||
Comet Holding AG | 14,343 | 5,397,065 | ||||||
DKSH Holding AG | 63,343 | 5,060,581 | ||||||
SIG Combibloc Group AG(1) | 248,662 | 6,554,753 | ||||||
Zur Rose Group AG(1) | 7,704 | 2,916,438 | ||||||
19,928,837 | ||||||||
United Kingdom — 17.6% | ||||||||
Darktrace plc(1) | 413,337 | 2,513,543 | ||||||
Diploma plc | 162,693 | 6,925,740 | ||||||
Electrocomponents plc | 448,620 | 7,226,608 | ||||||
Endava plc, ADR(1) | 49,671 | 7,775,498 | ||||||
Future plc | 149,052 | 7,114,414 | ||||||
Grafton Group plc | 276,262 | 4,295,081 | ||||||
Greggs plc | 141,259 | 5,622,435 | ||||||
Hays plc | 2,420,406 | 4,735,013 | ||||||
Howden Joinery Group plc | 374,646 | 4,316,280 | ||||||
Intermediate Capital Group plc | 204,875 | 5,691,342 | ||||||
Marks & Spencer Group plc(1) | 2,015,526 | 6,323,712 | ||||||
Pets at Home Group plc | 987,048 | 6,108,568 | ||||||
S4 Capital plc(1) | 167,642 | 1,294,823 | ||||||
Savills plc | 290,616 | 5,153,727 | ||||||
Tritax Big Box REIT plc | 2,478,086 | 7,832,171 | ||||||
Virgin Money UK plc(1) | 1,258,561 | 2,789,455 | ||||||
Watches of Switzerland Group plc(1) | 494,006 | 8,815,815 | ||||||
94,534,225 | ||||||||
TOTAL COMMON STOCKS (Cost $427,005,430) | 526,941,766 |
9
Shares | Value | |||||||
EXCHANGE-TRADED FUNDS† | ||||||||
iShares MSCI EAFE Small-Cap ETF(2) (Cost $71,366) | 952 | $ | 68,468 | |||||
TEMPORARY CASH INVESTMENTS — 1.7% | ||||||||
Repurchase Agreement, BMO Capital Markets Corp., (collateralized by various U.S. Treasury obligations, 0.125% - 2.625%, 6/30/22 - 5/15/51, valued at $2,183,244), in a joint trading account at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $2,137,461) | 2,137,460 | |||||||
Repurchase Agreement, Fixed Income Clearing Corp., (collateralized by various U.S. Treasury obligations, 1.00%, 7/31/28, valued at $7,270,593), at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $7,128,004) | 7,128,000 | |||||||
State Street Institutional U.S. Government Money Market Fund, Premier Class | 33,132 | 33,132 | ||||||
TOTAL TEMPORARY CASH INVESTMENTS (Cost $9,298,592) | 9,298,592 | |||||||
TEMPORARY CASH INVESTMENTS - SECURITIES LENDING COLLATERAL(3) — 0.2% | ||||||||
State Street Navigator Securities Lending Government Money Market Portfolio (Cost $976,038) | 976,038 | 976,038 | ||||||
TOTAL INVESTMENT SECURITIES — 100.1% (Cost $437,351,426) | 537,284,864 | |||||||
OTHER ASSETS AND LIABILITIES — (0.1)% | (568,800) | |||||||
TOTAL NET ASSETS — 100.0% | $ | 536,716,064 |
MARKET SECTOR DIVERSIFICATION | |||||
(as a % of net assets) | |||||
Industrials | 22.4% | ||||
Consumer Discretionary | 19.4% | ||||
Information Technology | 15.1% | ||||
Financials | 9.9% | ||||
Health Care | 8.4% | ||||
Real Estate | 7.4% | ||||
Consumer Staples | 4.7% | ||||
Materials | 4.2% | ||||
Communication Services | 4.1% | ||||
Utilities | 1.5% | ||||
Energy | 1.1% | ||||
Exchange-Traded Funds | —* | ||||
Temporary Cash Investments | 1.7% | ||||
Temporary Cash Investments - Securities Lending Collateral | 0.2% | ||||
Other Assets and Liabilities | (0.1)% |
*Category is less than 0.05% of total net assets.
NOTES TO SCHEDULE OF INVESTMENTS | ||||||||
ADR | - | American Depositary Receipt |
†Category is less than 0.05% of total net assets.
(1)Non-income producing.
(2)Security, or a portion thereof, is on loan. At the period end, the aggregate value of securities on loan was $7,826,908. The amount of securities on loan indicated may not correspond with the securities on loan identified because securities with pending sales are in the process of recall from the brokers.
(3)Investment of cash collateral from securities on loan. At the period end, the aggregate value of the collateral held by the fund was $8,586,007, which includes securities collateral of $7,609,969.
See Notes to Financial Statements.
10
Statement of Assets and Liabilities |
NOVEMBER 30, 2021 | |||||
Assets | |||||
Investment securities, at value (cost of $436,375,388) — including $7,826,908 of securities on loan | $ | 536,308,826 | |||
Investment made with cash collateral received for securities on loan, at value (cost of $976,038) | 976,038 | ||||
Total investment securities, at value (cost of $437,351,426) | 537,284,864 | ||||
Foreign currency holdings, at value (cost of $3,148) | 3,165 | ||||
Receivable for capital shares sold | 316,003 | ||||
Dividends and interest receivable | 788,940 | ||||
Securities lending receivable | 7,430 | ||||
538,400,402 | |||||
Liabilities | |||||
Payable for collateral received for securities on loan | 976,038 | ||||
Payable for investments purchased | 576,122 | ||||
Accrued management fees | 132,178 | ||||
1,684,338 | |||||
Net Assets | $ | 536,716,064 | |||
Net Assets Consist of: | |||||
Capital (par value and paid-in surplus) | $ | 340,310,670 | |||
Distributable earnings | 196,405,394 | ||||
$ | 536,716,064 |
Net Assets | Shares Outstanding | Net Asset Value Per Share | |||||||||
Investor Class, $0.01 Par Value | $105,938,195 | 7,059,579 | $15.01 | ||||||||
G Class, $0.01 Par Value | $430,777,869 | 28,089,256 | $15.34 |
See Notes to Financial Statements.
11
Statement of Operations |
YEAR ENDED NOVEMBER 30, 2021 | |||||
Investment Income (Loss) | |||||
Income: | |||||
Dividends (net of foreign taxes withheld of $591,089) | $ | 5,606,211 | |||
Securities lending, net | 135,803 | ||||
Interest | 577 | ||||
5,742,591 | |||||
Expenses: | |||||
Management fees | 6,507,399 | ||||
Directors' fees and expenses | 13,902 | ||||
Other expenses | 34,665 | ||||
6,555,966 | |||||
Fees waived(1) | (4,999,509) | ||||
1,556,457 | |||||
Net investment income (loss) | 4,186,134 | ||||
Realized and Unrealized Gain (Loss) | |||||
Net realized gain (loss) on: | |||||
Investment transactions | 108,704,369 | ||||
Foreign currency translation transactions | (21,491) | ||||
108,682,878 | |||||
Change in net unrealized appreciation (depreciation) on: | |||||
Investments | (19,566,534) | ||||
Translation of assets and liabilities in foreign currencies | (33,321) | ||||
(19,599,855) | |||||
Net realized and unrealized gain (loss) | 89,083,023 | ||||
Net Increase (Decrease) in Net Assets Resulting from Operations | $ | 93,269,157 |
(1)Amount consists of $42,179 and $4,957,330 for Investor Class and G Class, respectively.
See Notes to Financial Statements.
12
Statement of Changes in Net Assets |
YEARS ENDED NOVEMBER 30, 2021 AND NOVEMBER 30, 2020 | ||||||||
Increase (Decrease) in Net Assets | November 30, 2021 | November 30, 2020 | ||||||
Operations | ||||||||
Net investment income (loss) | $ | 4,186,134 | $ | 3,006,377 | ||||
Net realized gain (loss) | 108,682,878 | 32,404,423 | ||||||
Change in net unrealized appreciation (depreciation) | (19,599,855) | 67,743,363 | ||||||
Net increase (decrease) in net assets resulting from operations | 93,269,157 | 103,154,163 | ||||||
Distributions to Shareholders | ||||||||
From earnings: | ||||||||
Investor Class | (3,058,614) | (1,580,340) | ||||||
G Class | (15,557,885) | (7,505,757) | ||||||
Decrease in net assets from distributions | (18,616,499) | (9,086,097) | ||||||
Capital Share Transactions | ||||||||
Net increase (decrease) in net assets from capital share transactions (Note 5) | (32,903,513) | 67,784,056 | ||||||
Net increase (decrease) in net assets | 41,749,145 | 161,852,122 | ||||||
Net Assets | ||||||||
Beginning of period | 494,966,919 | 333,114,797 | ||||||
End of period | $ | 536,716,064 | $ | 494,966,919 |
See Notes to Financial Statements.
13
Notes to Financial Statements |
NOVEMBER 30, 2021
1. Organization
American Century World Mutual Funds, Inc. (the corporation) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company and is organized as a Maryland corporation. NT International Small-Mid Cap Fund (the fund) is one fund in a series issued by the corporation. The fund’s investment objective is to seek capital growth. The fund offers the Investor Class and G Class.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently followed by the fund in preparation of its financial statements. The fund is an investment company and follows accounting and reporting guidance in accordance with accounting principles generally accepted in the United States of America. This may require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from these estimates. Management evaluated the impact of events or transactions occurring through the date the financial statements were issued that would merit recognition or disclosure.
Investment Valuations — The fund determines the fair value of its investments and computes its net asset value (NAV) per share at the close of regular trading (usually 4 p.m. Eastern time) on the New York Stock Exchange (NYSE) on each day the NYSE is open. The Board of Directors has adopted valuation policies and procedures to guide the investment advisor in the fund’s investment valuation process and to provide methodologies for the oversight of the fund’s pricing function.
Equity securities that are listed or traded on a domestic securities exchange are valued at the last reported sales price or at the official closing price as provided by the exchange. Equity securities traded on foreign securities exchanges are generally valued at the closing price of such securities on the exchange where primarily traded or at the close of the NYSE, if that is earlier. If no last sales price is reported, or if local convention or regulation so provides, the mean of the latest bid and asked prices may be used. Securities traded over-the-counter are valued at the mean of the latest bid and asked prices, the last sales price, or the official closing price. Equity securities initially expressed in local currencies are translated into U.S. dollars at the mean of the appropriate currency exchange rate at the close of the NYSE as provided by an independent pricing service.
Open-end management investment companies are valued at the reported NAV per share. Repurchase agreements are valued at cost, which approximates fair value.
If the fund determines that the market price for an investment is not readily available or the valuation methods mentioned above do not reflect an investment’s fair value, such investment is valued as determined in good faith by the Board of Directors or its delegate, in accordance with policies and procedures adopted by the Board of Directors. In its determination of fair value, the fund may review several factors including, but not limited to, market information regarding the specific investment or comparable investments and correlation with other investment types, futures indices or general market indicators. Circumstances that may cause the fund to use these procedures to value an investment include, but are not limited to: an investment has been declared in default or is distressed; trading in a security has been suspended during the trading day or a security is not actively trading on its principal exchange; prices received from a regular pricing source are deemed unreliable; or there is a foreign market holiday and no trading occurred.
The fund monitors for significant events occurring after the close of an investment’s primary exchange but before the fund’s NAV per share is determined. Significant events may include, but are not limited to: corporate announcements and transactions; governmental action and political unrest that could impact a specific investment or an investment sector; or armed conflicts, natural disasters and similar events that could affect investments in a specific country or region. The fund also monitors for significant fluctuations between domestic and foreign markets, as evidenced by the U.S. market or such other indicators that the Board of Directors, or its delegate, deems appropriate. The fund may apply a model-derived factor to the closing price of equity securities traded on foreign securities exchanges. The factor is based on observable market data as provided by an independent pricing service.
14
Security Transactions — Security transactions are accounted for as of the trade date. Net realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes.
Investment Income — Dividend income less foreign taxes withheld, if any, is recorded as of the ex-dividend date. Distributions received on securities that represent a return of capital or long-term capital gain are recorded as a reduction of cost of investments and/or as a realized gain. The fund may estimate the components of distributions received that may be considered nontaxable distributions or long-term capital gain distributions for income tax purposes. Interest income is recorded on the accrual basis and includes accretion of discounts and amortization of premiums. Securities lending income is net of fees and rebates earned by the lending agent for its services.
Foreign Currency Translations — All assets and liabilities initially expressed in foreign currencies are translated into U.S. dollars at prevailing exchange rates at period end. The fund may enter into spot foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of investment securities, dividend and interest income, spot foreign currency exchange contracts, and expenses are translated at the rates of exchange prevailing on the respective dates of such transactions. Net realized and unrealized foreign currency exchange gains or losses related to investment securities are a component of net realized gain (loss) on investment transactions and change in net unrealized appreciation (depreciation) on investments, respectively.
Repurchase Agreements — The fund may enter into repurchase agreements with institutions that American Century Investment Management, Inc. (ACIM) (the investment advisor) has determined are creditworthy pursuant to criteria adopted by the Board of Directors. The fund requires that the collateral, represented by securities, received in a repurchase transaction be transferred to the custodian in a manner sufficient to enable the fund to obtain those securities in the event of a default under the repurchase agreement. ACIM monitors, on a daily basis, the securities transferred to ensure the value, including accrued interest, of the securities under each repurchase agreement is equal to or greater than amounts owed to the fund under each repurchase agreement.
Joint Trading Account — Pursuant to an Exemptive Order issued by the Securities and Exchange Commission, the fund, along with certain other funds in the American Century Investments family of funds, may transfer uninvested cash balances into a joint trading account. These balances are invested in one or more repurchase agreements that are collateralized by U.S. Treasury or Agency obligations.
Income Tax Status — It is the fund’s policy to distribute substantially all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code. Accordingly, no provision has been made for income taxes. The fund files U.S. federal, state, local and non-U.S. tax returns as applicable. The fund's tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years from the date of filing but can be longer in certain jurisdictions. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Segregated Assets — In accordance with the 1940 Act, the fund segregates assets on its books and records to cover certain types of investment securities and other financial instruments. ACIM monitors, on a daily basis, the securities segregated to ensure the fund designates a sufficient amount of liquid assets, marked-to-market daily. The fund may also receive assets or be required to pledge assets at the custodian bank or with a broker for collateral requirements.
Multiple Class — All shares of the fund represent an equal pro rata interest in the net assets of the class to which such shares belong, and have identical voting, dividend, liquidation and other rights and the same terms and conditions, except for class specific expenses and exclusive rights to vote on matters affecting only individual classes. Income, non-class specific expenses, and realized and unrealized capital gains and losses of the fund are allocated to each class of shares based on their relative net assets.
Distributions to Shareholders — Distributions from net investment income and net realized gains, if any, are generally declared and paid annually. The fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code, in all events in a manner consistent with provisions of the 1940 Act. The fund may elect to treat a portion of its payment to a redeeming shareholder, which represents the pro rata share of undistributed net investment income and net realized
gains, as a distribution for federal income tax purposes (tax equalization).
15
Indemnifications — Under the corporation’s organizational documents, its officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business, the fund enters into contracts that provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against a fund. The risk of material loss from such claims is considered by management to be remote.
Securities Lending — Securities are lent to qualified financial institutions and brokers. State Street Bank & Trust Co. serves as securities lending agent to the fund pursuant to a Securities Lending Agreement. The lending of securities exposes the fund to risks such as: the borrowers may fail to return the loaned securities, the borrowers may not be able to provide additional collateral, the fund may experience delays in recovery of the loaned securities or delays in access to collateral, or the fund may experience losses related to the investment collateral. To minimize certain risks, loan counterparties pledge collateral in the form of cash and/or securities. The lending agent has agreed to indemnify the fund in the case of default of any securities borrowed. Cash collateral received is invested in the State Street Navigator Securities Lending Government Money Market Portfolio, a money market mutual fund registered under the 1940 Act. The loans may also be secured by U.S. government securities in an amount at least equal to the market value of the securities loaned, plus accrued interest and dividends, determined on a daily basis and adjusted accordingly. By lending securities, the fund seeks to increase its net investment income through the receipt of interest and fees. Such income is reflected separately within the Statement of Operations. The value of loaned securities and related collateral outstanding at period end, if any, are shown on a gross basis within the Schedule of Investments and Statement of Assets and Liabilities.
The following table reflects a breakdown of transactions accounted for as secured borrowings, the gross obligation by the type of collateral pledged, and the remaining contractual maturity of those transactions as of November 30, 2021.
Remaining Contractual Maturity of Agreements | |||||||||||||||||
Overnight and Continuous | <30 days | Between 30 & 90 days | >90 days | Total | |||||||||||||
Securities Lending Transactions(1) | |||||||||||||||||
Common Stocks | $ | 976,038 | — | — | — | $ | 976,038 | ||||||||||
Gross amount of recognized liabilities for securities lending transactions | $ | 976,038 |
(1)Amount represents the payable for cash collateral received for securities on loan. This will generally be in the Overnight and Continuous column as the securities are typically callable on demand.
3. Fees and Transactions with Related Parties
Certain officers and directors of the corporation are also officers and/or directors of American Century Companies, Inc. (ACC). The corporation’s investment advisor, ACIM, the corporation's distributor, American Century Investment Services, Inc., and the corporation’s transfer agent, American Century Services, LLC, are wholly owned, directly or indirectly, by ACC. Various funds issued by American Century Asset Allocation Portfolios, Inc. own, in aggregate, 60% of the shares of the fund. Related parties do not invest in the fund for the purpose of exercising management or control.
Management Fees — The corporation has entered into a management agreement with ACIM, under which ACIM provides the fund with investment advisory and management services in exchange for a single, unified management fee (the fee) per class. The agreement provides that ACIM will pay all expenses of managing and operating the fund, except brokerage expenses, taxes, interest, fees and expenses of the independent directors (including legal counsel fees), and extraordinary expenses. The fee is computed and accrued daily based on each class's daily net assets and paid monthly in arrears. The difference in the fee among the classes is a result of their separate arrangements for non-Rule 12b-1 shareholder services, which may be provided indirectly through another American Century Investments mutual fund. It is not the result of any difference in advisory or custodial fees or other expenses related to the management of the fund’s assets, which do not vary by class. During the period ended November 30, 2021, the investment advisor agreed to waive 0.04% of the fund's management fee. The investment advisor expects this waiver to continue until July 31, 2022 and cannot terminate it prior to such date without the approval of the Board of Directors. The investment advisor agreed to waive the G Class's management fee in its entirety. The investment advisor expects this waiver to remain in effect permanently and cannot terminate it without the approval of the Board of Directors.
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The annual management fee and the effective annual management fee after waiver for each class for the period ended November 30, 2021 are as follows:
Annual Management Fee | Effective Annual Management Fee After Waiver | |||||||
Investor Class | 1.47% | 1.43% | ||||||
G Class | 1.12% | 0.00% |
Directors' Fees and Expenses — The Board of Directors is responsible for overseeing the investment advisor’s management and operations of the fund. The directors receive detailed information about the fund and its investment advisor regularly throughout the year, and meet at least quarterly with management of the investment advisor to review reports about fund operations. The fund’s officers do not receive compensation from the fund.
Interfund Transactions — The fund may enter into security transactions with other American Century Investments funds and other client accounts of the investment advisor, in accordance with the 1940 Act rules and procedures adopted by the Board of Directors. The rules and procedures require, among other things, that these transactions be effected at the independent current market price of the security. During the period, the interfund purchases and sales were $105,715 and $330,962, respectively. The effect of interfund transactions on the Statement of Operations was $111,166 in net realized gain (loss) on investment transactions.
4. Investment Transactions
Purchases and sales of investment securities, excluding short-term investments, for the period ended November 30, 2021 were $605,529,213 and $659,254,137, respectively.
5. Capital Share Transactions
Transactions in shares of the fund were as follows:
Year ended November 30, 2021 | Year ended November 30, 2020 | |||||||||||||
Shares | Amount | Shares | Amount | |||||||||||
Investor Class/Shares Authorized | 120,000,000 | 120,000,000 | ||||||||||||
Sold | 5,229 | $ | 74,661 | 492,052 | $ | 3,938,077 | ||||||||
Issued in reinvestment of distributions | 232,594 | 3,058,614 | 147,695 | 1,580,340 | ||||||||||
Redeemed | (615,068) | (8,513,390) | (2,059,298) | (23,788,410) | ||||||||||
(377,245) | (5,380,115) | (1,419,551) | (18,269,993) | |||||||||||
G Class/Shares Authorized | 300,000,000 | 300,000,000 | ||||||||||||
Sold | 1,792,308 | 26,639,764 | 16,319,664 | 188,246,740 | ||||||||||
Issued in reinvestment of distributions | 1,173,295 | 15,557,885 | 700,818 | 7,505,757 | ||||||||||
Redeemed | (4,597,000) | (69,721,047) | (9,513,355) | (109,698,448) | ||||||||||
(1,631,397) | (27,523,398) | 7,507,127 | 86,054,049 | |||||||||||
Net increase (decrease) | (2,008,642) | $ | (32,903,513) | 6,087,576 | $ | 67,784,056 |
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6. Fair Value Measurements
The fund’s investments valuation process is based on several considerations and may use multiple inputs to determine the fair value of the investments held by the fund. In conformity with accounting principles generally accepted in the United States of America, the inputs used to determine a valuation are classified into three broad levels.
•Level 1 valuation inputs consist of unadjusted quoted prices in an active market for identical investments.
•Level 2 valuation inputs consist of direct or indirect observable market data (including quoted prices for comparable investments, evaluations of subsequent market events, interest rates, prepayment speeds, credit risk, etc.). These inputs also consist of quoted prices for identical investments initially expressed in local currencies that are adjusted through translation into U.S. dollars.
•Level 3 valuation inputs consist of unobservable data (including a fund’s own assumptions).
The level classification is based on the lowest level input that is significant to the fair valuation measurement. The valuation inputs are not necessarily an indication of the risks associated with investing in these securities or other financial instruments.
The following is a summary of the level classifications as of period end. The Schedule of Investments provides additional information on the fund’s portfolio holdings.
Level 1 | Level 2 | Level 3 | |||||||||
Assets | |||||||||||
Investment Securities | |||||||||||
Common Stocks | |||||||||||
Canada | $ | 2,884,555 | $ | 49,315,851 | — | ||||||
Israel | 18,099,642 | — | — | ||||||||
Singapore | 2,216,369 | — | — | ||||||||
United Kingdom | 7,775,498 | 86,758,727 | — | ||||||||
Other Countries | — | 359,891,124 | — | ||||||||
Exchange-Traded Funds | 68,468 | — | — | ||||||||
Temporary Cash Investments | 33,132 | 9,265,460 | — | ||||||||
Temporary Cash Investments - Securities Lending Collateral | 976,038 | — | — | ||||||||
$ | 32,053,702 | $ | 505,231,162 | — |
7. Risk Factors
The value of the fund’s shares will go up and down, sometimes rapidly or unpredictably, based on the performance of the securities owned by the fund and other factors generally affecting the securities market. Market risks, including political, regulatory, economic and social developments, can affect the value of the fund’s investments. Natural disasters, public health emergencies, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse long-term effects on world economies and markets generally.
The fund is owned by a relatively small number of shareholders, and in the event such shareholders redeem, the ongoing operations of the fund may be at risk.
There are certain risks involved in investing in foreign securities. These risks include those resulting from political events (such as civil unrest, national elections and imposition of exchange controls), social and economic events (such as labor strikes and rising inflation), and natural disasters. Securities of foreign issuers may be less liquid and more volatile. Investing a significant portion of assets in one country or region may accentuate these risks.
The fund invests in common stocks of small companies. Because of this, the fund may be subject to greater risk and market fluctuations than a fund investing in larger, more established companies.
The fund’s investment process may result in high portfolio turnover, which could mean high transaction costs, affecting both performance and capital gains tax liabilities to investors.
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8. Federal Tax Information
On December 21, 2021, the fund declared and paid a per-share distribution from net realized gains to shareholders of record on December 20, 2021 of $2.6025 for the Investor Class and G Class.
On December 21, 2021, the fund declared and paid the following per-share distributions from net investment income to shareholders of record on December 20, 2021:
Investor Class | G Class | ||||
$0.1029 | $0.3117 |
The tax character of distributions paid during the years ended November 30, 2021 and November 30, 2020 were as follows:
2021 | 2020 | |||||||
Distributions Paid From | ||||||||
Ordinary income | $ | 3,023,124 | $ | 9,086,097 | ||||
Long-term capital gains | $ | 15,593,375 | — |
The book-basis character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements.
The reclassifications, which are primarily due to tax equalization, were made to capital $5,475,429 and distributable earnings $(5,475,429).
As of period end, the federal tax cost of investments and the components of distributable earnings on a tax-basis were as follows:
Federal tax cost of investments | $ | 445,604,124 | |||
Gross tax appreciation of investments | $ | 113,092,089 | |||
Gross tax depreciation of investments | (21,411,349) | ||||
Net tax appreciation (depreciation) of investments | 91,680,740 | ||||
Net tax appreciation (depreciation) on translation of assets and liabilities in foreign currencies | (10,289) | ||||
Net tax appreciation (depreciation) | $ | 91,670,451 | |||
Undistributed ordinary income | $ | 41,816,399 | |||
Accumulated long-term gains | $ | 62,918,544 |
The difference between book-basis and tax-basis unrealized appreciation (depreciation) is attributable primarily to the realization to ordinary income for tax purposes of unrealized gains on investments in passive foreign investment companies.
9. Corporate Event
On December 2, 2021, the Board of Directors approved a name change for the fund. Effective April 1, 2022, the fund’s name will change to International Small-Mid Cap Fund.
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Financial Highlights |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Operating Expenses (before expense waiver) | Net Investment Income (Loss) | Net Investment Income (Loss) (before expense waiver) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||||||
Investor Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $13.16 | (0.06) | 2.34 | 2.28 | — | (0.43) | (0.43) | $15.01 | 17.70% | 1.44% | 1.48% | (0.39)% | (0.43)% | 113% | $105,938 | ||||||||||||||||||||||||||||||||
2020 | $10.61 | (0.03) | 2.76 | 2.73 | (0.18) | — | (0.18) | $13.16 | 26.24% | 1.47% | 1.48% | (0.25)% | (0.26)% | 131% | $97,901 | ||||||||||||||||||||||||||||||||
2019 | $10.56 | 0.01 | 1.14 | 1.15 | (0.04) | (1.06) | (1.10) | $10.61 | 13.13% | 1.48% | 1.48% | 0.14% | 0.14% | 133% | $93,941 | ||||||||||||||||||||||||||||||||
2018 | $13.16 | 0.01 | (1.73) | (1.72) | (0.11) | (0.77) | (0.88) | $10.56 | (14.20)% | 1.47% | 1.47% | 0.09% | 0.09% | 140% | $66,042 | ||||||||||||||||||||||||||||||||
2017 | $9.88 | (0.01) | 3.29 | 3.28 | — | — | — | $13.16 | 33.20% | 1.48% | 1.48% | (0.10)% | (0.10)% | 122% | $76,484 | ||||||||||||||||||||||||||||||||
G Class | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | $13.36 | 0.16 | 2.35 | 2.51 | (0.10) | (0.43) | (0.53) | $15.34 | 19.45% | 0.01% | 1.13% | 1.04% | (0.08)% | 113% | $430,778 | ||||||||||||||||||||||||||||||||
2020 | $10.77 | 0.13 | 2.80 | 2.93 | (0.34) | — | (0.34) | $13.36 | 28.03% | 0.01% | 1.13% | 1.21% | 0.09% | 131% | $397,066 | ||||||||||||||||||||||||||||||||
2019 | $10.72 | 0.16 | 1.13 | 1.29 | (0.18) | (1.06) | (1.24) | $10.77 | 14.77% | 0.01% | 1.13% | 1.61% | 0.49% | 133% | $239,174 | ||||||||||||||||||||||||||||||||
2018 | $13.25 | 0.20 | (1.76) | (1.56) | (0.20) | (0.77) | (0.97) | $10.72 | (12.95)% | 0.00%(3) | 1.12% | 1.56% | 0.44% | 140% | $140,057 | ||||||||||||||||||||||||||||||||
2017 | $9.89 | 0.06 | 3.32 | 3.38 | (0.02) | — | (0.02) | $13.25 | 34.20% | 0.80% | 1.22% | 0.58% | 0.16% | 122% | $172,954 |
Notes to Financial Highlights |
(1)Computed using average shares outstanding throughout the period.
(2)Total returns are calculated based on the net asset value of the last business day. Total returns for periods less than one year are not annualized.
(3)Ratio was less than 0.005%.
See Notes to Financial Statements.
Report of Independent Registered Public Accounting Firm |
To the Shareholders and the Board of Directors of American Century World Mutual Funds, Inc.:
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of NT International Small-Mid Cap Fund (the “Fund”), one of the funds constituting the American Century World Mutual Funds, Inc., as of November 30, 2021, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of NT International Small-Mid Cap Fund of the American Century World Mutual Funds, Inc. as of November 30, 2021, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund’s financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. 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, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of November 30, 2021, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
/s/ Deloitte & Touche LLP
Kansas City, Missouri
January 19, 2022
We have served as the auditor of one or more American Century investment companies since 1997.
22
Management |
The Board of Directors
The individuals listed below serve as directors of the funds. Each director will continue to serve in this capacity until death, retirement, resignation or removal from office. The board has adopted a mandatory retirement age for directors who are not “interested persons,” as that term is defined in the Investment Company Act (independent directors). Independent directors shall retire by December 31 of the year in which they reach their 75th birthday.
Jonathan S. Thomas is an “interested person” because he currently serves as President and Chief Executive Officer of American Century Companies, Inc. (ACC), the parent company of American Century Investment Management, Inc. (ACIM or the advisor). The other directors (more than three-fourths of the total number) are independent. They are not employees, directors or officers of, and have no financial interest in, ACC or any of its wholly owned, direct or indirect, subsidiaries, including ACIM, American Century Investment Services, Inc. (ACIS) and American Century Services, LLC (ACS), and they do not have any other affiliations, positions or relationships that would cause them to be considered “interested persons” under the Investment Company Act. The directors serve in this capacity for seven (in the case of Jonathan S. Thomas, 16; and Stephen E. Yates, 8) registered investment companies in the American Century Investments family of funds.
The following table presents additional information about the directors. The mailing address for each director is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Thomas W. Bunn (1953) | Director | Since 2017 | Retired | 72 | SquareTwo Financial; Barings (formerly Babson Capital Funds Trust) (2013 to 2016) | ||||||||||||
Chris H. Cheesman (1962) | Director | Since 2019 | Retired. Senior Vice President & Chief Audit Executive, AllianceBernstein (1999 to 2018) | 72 | Alleghany Corporation | ||||||||||||
Barry Fink (1955) | Director | Since 2012 (independent since 2016) | Retired | 72 | None | ||||||||||||
Rajesh K. Gupta (1960) | Director | Since 2019 | Partner Emeritus, SeaCrest Investment Management and SeaCrest Wealth Management (2019 to Present); Chief Executive Officer and Chief Investment Officer, SeaCrest Investment Management (2006 to 2019); Chief Executive Officer and Chief Investment Officer, SeaCrest Wealth Management (2008 to 2019) | 72 | None |
23
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Lynn Jenkins (1963) | Director | Since 2019 | Consultant, LJ Strategies (2019 to present); United States Representative, U.S. House of Representatives (2009 to 2018) | 72 | MGP Ingredients, Inc. (2019 to 2021) | ||||||||||||
Jan M. Lewis (1957) | Director | Since 2011 | Retired | 72 | None | ||||||||||||
John R. Whitten(1) (1946) | Director | Since 2008 | Retired | 72 | Onto Innovation Inc. (2019 to 2020); Rudolph Technologies, Inc. (2006 to 2019) | ||||||||||||
Stephen E. Yates (1948) | Director and Chairman of the Board | Since 2012 (Chairman since 2018) | Retired | 108 | None | ||||||||||||
Interested Director | |||||||||||||||||
Jonathan S. Thomas (1963) | Director | Since 2007 | President and Chief Executive Officer, ACC (2007 to present). Also serves as Chief Executive Officer, ACS; Director, ACC and other ACC subsidiaries | 146 | None |
(1) Effective December 31, 2021, John R. Whitten retired from the Board of Directors.
The Statement of Additional Information has additional information about the fund's directors and is available without charge, upon request, by calling 1-800-345-2021.
24
Officers
The following table presents certain information about the executive officers of the funds. Each officer serves as an officer for each of the 16 (in the case of Robert J. Leach, 15) investment companies in the American Century family of funds. No officer is compensated for his or her service as an officer of the funds. The listed officers are interested persons of the funds and are appointed or re-appointed on an annual basis. The mailing address for each officer listed below is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Offices with the Funds | Principal Occupation(s) During the Past Five Years | ||||||
Patrick Bannigan (1965) | President since 2019 | Executive Vice President and Director, ACC (2012 to present); Chief Financial Officer, Chief Accounting Officer and Treasurer, ACC (2015 to present). Also serves as President, ACS; Vice President, ACIM; Chief Financial Officer, Chief Accounting Officer and/or Director, ACIM, ACS and other ACC subsidiaries | ||||||
R. Wes Campbell (1974) | Chief Financial Officer and Treasurer since 2018 | Vice President, ACS, (2020 to present); Investment Operations and Investment Accounting, ACS (2000 to present) | ||||||
Amy D. Shelton (1964) | Chief Compliance Officer and Vice President since 2014 | Chief Compliance Officer, American Century funds, (2014 to present); Chief Compliance Officer, ACIM (2014 to present); Chief Compliance Officer, ACIS (2009 to present). Also serves as Vice President, ACIS | ||||||
John Pak (1968) | General Counsel and Senior Vice President since 2021 | General Counsel and Senior Vice President, ACC (2021 to present). Also serves as General Counsel and Senior Vice President, ACIM, ACS and ACIS. Chief Legal Officer of Investment and Wealth Management, The Bank of New York Mellon (2014 to 2021) | ||||||
C. Jean Wade (1964) | Vice President since 2012 | Senior Vice President, ACS (2017 to present); Vice President, ACS (2000 to 2017) | ||||||
Robert J. Leach (1966) | Vice President since 2006 | Vice President, ACS (2000 to present) | ||||||
David H. Reinmiller (1963) | Vice President since 2000 | Attorney, ACC (1994 to present). Also serves as Vice President, ACIM and ACS | ||||||
Ward D. Stauffer (1960) | Secretary since 2005 | Attorney, ACC (2003 to present) |
25
Approval of Management Agreement |
At a meeting held on June 30, 2021, the Fund’s Board of Directors (the "Board") unanimously approved the renewal of the management agreement pursuant to which American Century Investment Management, Inc. (the “Advisor”) acts as the investment advisor for the Fund. Under Section 15(c) of the Investment Company Act, contracts for investment advisory services are required to be reviewed, evaluated, and approved by a majority of a fund’s directors (the “Directors”), including a majority of the independent Directors, each year.
Prior to its consideration of the renewal of the management agreement, the Directors requested and reviewed extensive data and information compiled by the Advisor and certain independent providers of evaluation data concerning the Fund and the services provided to the Fund by the Advisor. This review was in addition to the oversight and evaluation undertaken by the Board and its committees on a continual basis and the information received was supplemental to the extensive information that the Board and its committees receive and consider throughout the year.
In connection with its consideration of the renewal of the management agreement, the Board’s review and evaluation of the services provided by the Advisor and its affiliates included, but was not limited to, the following:
•the nature, extent, and quality of investment management, shareholder services, and other services provided and to be provided to the Fund including without limitation portfolio management and trading services, shareholder and intermediary services, compliance and legal services, fund accounting and financial reporting, and fund share distribution;
•the wide range of other programs and services provided and to be provided to the Fund and its shareholders on a routine and non-routine basis;
•the Fund’s investment performance, including data comparing the Fund's performance to appropriate benchmarks and/or a peer group of other mutual funds with similar investment objectives and strategies;
•the cost of owning the Fund compared to the cost of owning similar funds;
•the compliance policies, procedures, and regulatory experience of the Advisor and the Fund's service providers;
•the Advisor’s strategic plans, COVID-19 pandemic response, vendor management practices, and social justice initiatives;
•the Advisor’s business continuity plans and cyber security practices;
•financial data showing the cost of services provided to the Fund, the profitability of the Fund to the Advisor, and the overall profitability of the Advisor;
•possible economies of scale associated with the Advisor’s management of the Fund and other accounts;
•services provided and charges to the Advisor's other investment management clients;
•acquired fund fees and expenses;
•payments and practices in connection with financial intermediaries holding shares of the Fund and the services provided by intermediaries in connection therewith; and
•possible collateral benefits to the Advisor from the management of the Fund.
The Board held two meetings to consider the renewal. The independent Directors also met in private session three times to review and discuss the information provided in response to their request. The independent Directors held active discussions with the Advisor regarding the renewal of the management agreement, requesting supplemental information, and reviewing information provided by the Advisor in response thereto. The independent Directors had the benefit of the advice of their independent counsel throughout the process.
26
Factors Considered
The Directors considered all of the information provided by the Advisor, the independent data providers, and independent counsel in connection with the approval. They determined that the information was sufficient for them to evaluate the management agreement for the Fund. In connection with their review, the Directors did not identify any single factor as being all-important or controlling, and each Director may have attributed different levels of importance to different factors. In deciding to renew the management agreement, the Board based its decision on a number of factors, including without limitation the following:
Nature, Extent and Quality of Services — Generally. Under the management agreement, the Advisor is responsible for providing or arranging for all services necessary for the operation of the Fund. The Board noted that the Advisor provides or arranges at its own expense a wide variety of services which include the following:
•constructing and designing the Fund
•portfolio research and security selection
•initial capitalization/funding
•securities trading
•Fund administration
•custody of Fund assets
•daily valuation of the Fund’s portfolio
•liquidity monitoring and management
•risk management, including cyber security
•shareholder servicing and transfer agency, including shareholder confirmations, recordkeeping, and communications
•legal services (except the independent Directors’ counsel)
•regulatory and portfolio compliance
•financial reporting
•marketing and distribution (except amounts paid by the Fund under Rule 12b-1 plans)
The Board noted that many of these services have expanded over time in terms of both quantity and complexity in response to shareholder demands, competition in the industry, changing distribution channels, and the changing regulatory environment.
Investment Management Services. The nature of the investment management services provided to the Fund is quite complex and allows Fund shareholders access to professional money management, instant diversification of their investments within an asset class, the opportunity to easily diversify among asset classes by investing in or exchanging among various American Century Investments funds, and liquidity. In evaluating investment performance, the Board expects the Advisor to manage the Fund in accordance with its investment objectives and approved strategies. Further, the Directors recognize that the Advisor has an obligation to monitor trading activities, and in particular to seek the best execution of fund trades, and to evaluate the use of and payment for research. In providing these services, the Advisor utilizes teams of investment professionals (portfolio managers, analysts, research assistants, and securities traders) who require extensive information technology, research, training, compliance, and other systems to conduct their business. The Board, directly and through its Fund Performance Review Committee, provides oversight of the investment performance process. It regularly reviews investment performance information for the Fund, together with comparative information for appropriate benchmarks and/or peer groups of similarly-managed funds, over different time horizons. The Directors also review investment performance information during the management agreement renewal process. If performance concerns are identified, the Fund receives special reviews until performance improves, during which the Board discusses with the Advisor the reasons for such results (e.g., market conditions, security selection) and any efforts being undertaken to improve performance. The Fund’s performance was above its benchmark for the one-, three-, and five-year periods reviewed by the Board. The Board found the investment management services provided by the Advisor to the Fund to be satisfactory and consistent with the management agreement.
27
Shareholder and Other Services. Under the management agreement, the Advisor provides the Fund with a comprehensive package of transfer agency, shareholder, and other services. The Board, directly and through its various committees, regularly reviews reports and evaluations of such services at its regular meetings. These reports include, but are not limited to, information regarding the operational efficiency and accuracy of the shareholder and transfer agency services provided, staffing levels, shareholder satisfaction, technology support (including cyber security), new products and services offered to Fund shareholders, securities trading activities, portfolio valuation services, auditing services, and legal and operational compliance activities. The Board found the services provided by the Advisor to the Fund under the management agreement to be competitive and of high quality.
Costs of Services and Profitability. The Advisor provides detailed information concerning its cost of providing various services to the Fund, its profitability in managing the Fund (pre- and post-distribution), its overall profitability, and its financial condition. The Directors have reviewed with the Advisor the methodology used to prepare this financial information. This information is considered in evaluating the Advisor’s financial condition, its ability to continue to provide services under the management agreement, and the reasonableness of the current management fee. The Board concluded that the Advisor’s profits were reasonable in light of the services provided to the Fund.
Ethics. The Board generally considers the Advisor’s commitment to providing quality services to shareholders and to conducting its business ethically. They noted that the Advisor’s practices generally meet or exceed industry best practices.
Economies of Scale. The Board also reviewed information provided by the Advisor regarding the possible existence of economies of scale in connection with the management of the Fund. The Board concluded that economies of scale are difficult to measure and predict with precision, especially on a fund-by-fund basis. The Board concluded that the Advisor is sharing economies of scale, to the extent they exist, through its competitive fee structure, offering competitive fees from fund inception, and through reinvestment in its business, infrastructure, investment capabilities and initiatives to provide shareholders additional content and services.
Comparison to Other Funds’ Fees. The management agreement provides that the Fund pays the Advisor a single, all-inclusive (or unified) management fee for providing all services necessary for the management and operation of the Fund, other than brokerage expenses, expenses attributable to short sales, taxes, interest, extraordinary expenses, fees and expenses of the Fund’s independent Directors (including their independent legal counsel), and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the Investment Company Act. Under the unified fee structure, the Advisor is responsible for providing all investment advisory, custody, audit, administrative, compliance, recordkeeping, marketing and shareholder services, or arranging and supervising third parties to provide such services. By contrast, most other funds are charged a variety of fees, including an investment advisory fee, a transfer agency fee, an administrative fee, distribution charges, and other expenses. Other than their investment advisory fees and any applicable Rule 12b-1 distribution fees, all other components of the total fees charged by these other funds may be increased without shareholder approval. The Board believes the unified fee structure is a benefit to Fund shareholders because it clearly discloses to shareholders the cost of owning Fund shares, and, since the unified fee cannot be increased without a vote of Fund shareholders, it shifts to the Advisor the risk of increased costs of operating the Fund and provides a direct incentive to minimize administrative inefficiencies. Part of the Board’s analysis of fee levels involves reviewing certain evaluative data compiled by an independent provider comparing the Fund’s unified fee to the total expense ratios of its peers. The unified fee charged to shareholders of the Fund was above the median of the total expense ratios of the Fund’s peer expense universe. In addition, the Board reviewed the Fund’s position relative to the narrower set of its expense group peers. The Board and the Advisor agreed to an extension of the current temporary reduction of the Fund's annual unified management fee of 0.04% (e.g., the Investor Class unified fee will be reduced from 1.47% to 1.43%) for at least one year, beginning August 1, 2021. The Board concluded that the management fee paid by the Fund to the Advisor under the management agreement is reasonable in light of the services provided to the Fund.
28
Comparison to Fees and Services Provided to Other Clients of the Advisor. The Board also requested and received information from the Advisor concerning the nature of the services, fees, costs, and profitability of its advisory services to advisory clients other than the Fund. They observed that these varying types of client accounts require different services and involve different regulatory and entrepreneurial risks than the management of the Fund. The Board analyzed this information and concluded that the fees charged and services provided to the Fund were reasonable by comparison.
Payments to Intermediaries. The Directors also requested and received a description of payments made to intermediaries by the Fund and the Advisor and services provided in response thereto. These payments include various payments made by the Fund or the Advisor to different types of intermediaries and recordkeepers for distribution and service activities provided for the Fund. The Directors reviewed such information and received representations from the Advisor that all such payments by the Fund were made pursuant to the Fund's Rule 12b-1 Plan and that all such payments by the Advisor were made from the Advisor’s resources and reasonable profits. The Board found such payments to be reasonable in scope and purpose.
Collateral or “Fall-Out” Benefits Derived by the Advisor. The Board considered the possible existence of collateral benefits the Advisor may receive as a result of its relationship with the Fund. They concluded that the Advisor’s primary business is managing funds and it generally does not use fund or shareholder information to generate profits in other lines of business, and therefore does not derive any significant collateral benefits from them. To the extent there are potential collateral benefits, the Board has been advised and has taken this into consideration in its review of the management contract with the Fund. The Board noted that additional assets from other clients may offer the Advisor some benefit from increased leverage with service providers and counterparties. Additionally, the Advisor may receive proprietary research from broker-dealers that execute fund portfolio transactions, which the Board concluded is likely to benefit other clients of the Advisor, as well as Fund shareholders. The Board also determined that the Advisor is able to provide investment management services to certain clients other than the Fund, at least in part, due to its existing infrastructure built to serve the fund complex. The Board concluded that appropriate allocation methodologies had been employed to assign resources and the cost of those resources to these other clients.
Existing Relationship. The Board also considered whether there was any reason for not continuing the existing arrangement with the Advisor. In this regard, the Board was mindful of the potential disruptions of the Fund’s operations and various risks, uncertainties, and other effects that could occur as a result of a decision not to continue such relationship. In particular, the Board recognized that most shareholders have invested in the Fund on the strength of the Advisor’s industry standing and reputation and in the expectation that the Advisor will have a continuing role in providing advisory services to the Fund.
Conclusion of the Directors. As a result of this process, the Board, including all of the independent Directors, taking into account all of the factors discussed above and the information provided by the Advisor and others in connection with its review and throughout the year, determined that the management fee is fair and reasonable in light of the services provided and that the investment management agreement between the Fund and the Advisor should be renewed.
29
Additional Information |
Retirement Account Information
As required by law, distributions you receive from certain retirement accounts are subject to federal income tax withholding, unless you elect not to have withholding apply*. Tax will be withheld on the total amount withdrawn even though you may be receiving amounts that are not subject to withholding, such as nondeductible contributions. In such case, excess amounts of withholding could occur. You may adjust your withholding election so that a greater or lesser amount will be withheld.
If you don’t want us to withhold on this amount, you must notify us to not withhold the federal income tax. You may notify us in writing or in certain situations by telephone or through other electronic means. For systematic withdrawals, your withholding election will remain in effect until revoked or changed by filing a new election. You have the right to revoke your election at any time and change your withholding percentage for future distributions.
Remember, even if you elect not to have income tax withheld, you are liable for paying income tax on the taxable portion of your withdrawal. If you elect not to have income tax withheld or you don’t have enough income tax withheld, you may be responsible for payment of estimated tax. You may incur penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. You can reduce or defer the income tax on a distribution by directly or indirectly rolling such distribution over to another IRA or eligible plan. You should consult your tax advisor for additional information.
State tax will be withheld if, at the time of your distribution, your address is within one of the mandatory withholding states and you have federal income tax withheld (or as otherwise required by state law). State taxes will be withheld from your distribution in accordance with the respective state rules.
*Some 403(b), 457 and qualified retirement plan distributions may be subject to 20% mandatory withholding, as they are subject to special tax and withholding rules. Your plan administrator or plan sponsor is required to provide you with a special tax notice explaining those rules at the time you request a distribution. If applicable, federal and/or state taxes may be withheld from your distribution amount.
Proxy Voting Policies
A description of the policies that the fund's investment advisor uses in exercising the voting rights associated with the securities purchased and/or held by the fund is available without charge, upon request, by calling 1-800-345-2021. It is also available on American Century Investments’ website at americancentury.com/proxy and on the Securities and Exchange Commission’s website at sec.gov. Information regarding how the investment advisor voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on americancentury.com/proxy. It is also available at sec.gov.
Quarterly Portfolio Disclosure
The fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. These portfolio holdings are available on the fund's website at americancentury.com and, upon request, by calling 1-800-345-2021. The fund’s Form N-PORT reports are available on the SEC’s website at sec.gov.
30
Other Tax Information
The following information is provided pursuant to provisions of the Internal Revenue Code.
The fund hereby designates up to the maximum amount allowable as qualified dividend income for
the fiscal year ended November 30, 2021.
The fund hereby designates $18,870,293, or up to the maximum amount allowable, as long-term capital gain distributions (20% rate gain distributions) for the fiscal year ended November 30, 2021.
The fund hereby designates $1,658,550 as qualified short-term capital gain distributions for purposes of Internal Revenue Code Section 871 for the fiscal year ended November 30, 2021.
For the fiscal year ended November 30, 2021, the fund intends to pass through to shareholders foreign source income of $6,197,300 and foreign taxes paid of $471,108, or up to the maximum amount allowable, as a foreign tax credit. Foreign source income and foreign tax expense per outstanding share on November 30, 2021 are $0.1763 and $0.0134, respectively.
The fund utilized earnings and profits of $5,475,429 distributed to shareholders on redemption of shares as part of the dividends paid deduction (tax equalization).
31
Notes |
32
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Contact Us | americancentury.com | |||||||
Automated Information Line | 1-800-345-8765 | |||||||
Investor Services Representative | 1-800-345-2021 or 816-531-5575 | |||||||
Investors Using Advisors | 1-800-378-9878 | |||||||
Business, Not-For-Profit, Employer-Sponsored Retirement Plans | 1-800-345-3533 | |||||||
Banks and Trust Companies, Broker-Dealers, Financial Professionals, Insurance Companies | 1-800-345-6488 | |||||||
Telecommunications Relay Service for the Deaf | 711 | |||||||
American Century World Mutual Funds, Inc. | ||||||||
Investment Advisor: American Century Investment Management, Inc. Kansas City, Missouri | ||||||||
This report and the statements it contains are submitted for the general information of our shareholders. The report is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. | ||||||||
©2022 American Century Proprietary Holdings, Inc. All rights reserved. CL-ANN-91025 2201 |
![image37.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/image37.jpg)
Annual Report | |||||
November 30, 2021 | |||||
NT International Value Fund | |||||
Investor Class (ANTVX) | |||||
G Class (ANTYX) |
Table of Contents |
Performance | |||||
Portfolio Commentary | |||||
Fund Characteristics | |||||
Shareholder Fee Example | |||||
Schedule of Investments | |||||
Statement of Assets and Liabilities | |||||
Statement of Operations | |||||
Statement of Changes in Net Assets | |||||
Notes to Financial Statements | |||||
Financial Highlights | |||||
Report of Independent Registered Public Accounting Firm | |||||
Management | |||||
Approval of Management Agreement | |||||
Additional Information |
Any opinions expressed in this report reflect those of the author as of the date of the report, and do not necessarily represent the opinions of American Century Investments® or any other person in the American Century Investments organization. Any such opinions are subject to change at any time based upon market or other conditions and American Century Investments disclaims any responsibility to update such opinions. These opinions may not be relied upon as investment advice and, because investment decisions made by American Century Investments funds are based on numerous factors, may not be relied upon as an indication of trading intent on behalf of any American Century Investments fund. Security examples are used for representational purposes only and are not intended as recommendations to purchase or sell securities. Performance information for comparative indices and securities is provided to American Century Investments by third party vendors. To the best of American Century Investments’ knowledge, such information is accurate at the time of printing.
Performance |
Total Returns as of November 30, 2021 | |||||||||||||||||
Average Annual Returns | |||||||||||||||||
Ticker Symbol | 1 year | 5 years | Since Inception | Inception Date | |||||||||||||
Investor Class | ANTVX | 9.25% | 5.68% | 2.46% | 3/19/15 | ||||||||||||
MSCI EAFE Value Index | — | 9.29% | 5.07% | 2.39% | — | ||||||||||||
G Class | ANTYX | 10.58% | 6.85% | 3.36% | 3/19/15 |
Fund returns would have been lower if a portion of the fees had not been waived.
Growth of $10,000 Over Life of Class | ||
$10,000 investment made March 19, 2015 | ||
Performance for other share classes will vary due to differences in fee structure. |
![chart-5f95e34eb3734747931.jpg](https://capedge.com/proxy/N-CSR/0000872825-22-000010/chart-5f95e34eb3734747931.jpg)
Value on November 30, 2021 | |||||
Investor Class — $11,767 | |||||
MSCI EAFE Value Index — $11,713 | |||||
Ending value of Investor Class would have been lower if a portion of the fees had not been waived.
Total Annual Fund Operating Expenses | |||||
Investor Class | G Class | ||||
1.12% | 0.77% |
The total annual fund operating expenses shown is as stated in the fund’s prospectus current as of the date of this report. The prospectus may vary from the expense ratio shown elsewhere in this report because it is based on a different time period, includes acquired fund fees and expenses, and, if applicable, does not include fee waivers or expense reimbursements.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
2
Portfolio Commentary |
Portfolio Managers: Yulin Long and Tsuyoshi Ozaki
Performance Summary
NT International Value rose 10.58%* for the fiscal year ended November 30, 2021, compared with the 9.29% return of its benchmark, the MSCI EAFE Value Index.
Global stocks delivered positive returns early in the reporting period, supported by improving corporate earnings. The vaccine rollout and predictions for better global economic growth also boosted equity performance. Expectations for accelerating economic improvement drove a rotation into cyclical stocks early in the period, which led value stocks to outperform growth. Later, several headwinds emerged, including COVID-19’s delta variant, supply chain disruptions, soaring inflation and rising yields. These eventually dampened the economic outlook and stock returns. Higher input costs and logistics challenges raised worries that profit margins could weaken in the near term. Global policymakers at central banks in England, Japan and the European Union signaled they likely would begin tapering asset purchases before year-end. A surge in credit problems for property developer China Evergrande Group late in the period also raised fears of a wider global credit crisis. In that environment, non-U.S. stock returns were volatile and declined from earlier highs, but nevertheless finished the period with solid gains.
Our stock selection process incorporates factors of valuation, quality, growth and sentiment, while minimizing unintended risks among industries and other risk characteristics. The consumer staples and health care sectors contributed the most to the fund’s relative returns. Positioning in the utilities and real estate sectors also contributed. Selection and allocation decisions made the industrials, energy, communication services and financials sectors detractors from relative performance.
Geographically, stock choices within Israel, the U.S. and Switzerland contributed the most to relative returns. In contrast, security selection in Japan, Finland and Sweden detracted from the fund's results.
Consumer Staples and Health Care Stocks Drive Contribution
In the consumer staples sector, positioning in the beverages industry was a top contributor to the fund’s outperformance. It helped relative results to be underweight Anheuser-Busch InBev, which was hurt by supply chain bottlenecks that caused demand for aluminum cans to surge and resulted in delivery delays. In the personal products industry, limited exposure to the British company Unilever was beneficial. The company said inflation had impacted input costs and pandemic-related shutdowns in Asia had hurt sales volumes. An overweight position in Jeronimo Martins, a Portuguese food retailer, added to performance as well. The company’s shares benefited from a market rotation into more defensive stocks.
In the health care sector, stock selection in the pharmaceuticals industry was the primary driver. The decision to limit exposure to several large pharmaceuticals stocks, including Novartis, Bayer and Sanofi, was beneficial. We exited our position in Bayer during the period. In addition, an overweight position in Novo Nordisk was also advantageous. A strong product pipeline and anticipated gains in the diabetes treatment market helped support shares.
*All fund returns referenced in this commentary are for G Class shares. G Class returns would have been lower if a portion of the fees had not been waived. Performance for other share classes will vary due to differences in fee structure; when G Class performance exceeds that of the fund’s benchmark, other share classes may not. See page 2 for returns for all share classes.
3
A large underweight position in the utilities sector added to relative performance as well. In the electric utilities industry, a decision to underweight shares of Enel, an Italian power company, contributed positively to results. The company reported lower sales and income due in part to lower energy trading activity in Italy and to unfavorable exchange rates with Latin America. In the real estate sector, a decision to avoid Vonovia, a Germany-based apartment developer, was also advantageous. Shares of Vonovia were hindered by doubts about the company’s attempted merger with another German apartment developer.
Elsewhere, U.K.-based Evraz, a steel manufacturing and mining company, contributed prominently to relative performance. Shares of the metals company moved higher on an improved earnings outlook.
Industrials Sector Detracted from Relative Results
Positioning in the industrials sector, particularly in the aerospace and defense and machinery industries, detracted from the fund’s relative returns. In the aerospace and defense industry, limited exposure to Airbus hindered results as did an overweight position in Safran, a France-based maker of aircraft and rocket engines. Shares of Airbus rose on strong earnings and upgrade guidance, while shares of Safran fell on weaker sales and earnings. We exited our position in Safran.
In the machinery industry, an overweight position was detrimental as were certain stock selections. For example, shares of Kone, a Finland-based company that makes elevators and escalators, declined due to parts shortages and rising input costs, so we exited this position. An overweight to the airlines industry also hindered relative performance.
Overweight exposure to Japan-based Nintendo, a video game company, also weighed on relative returns. The company’s stock declined due to earnings that were weaker relative to pandemic-related strength in 2020. An underweight position in Toyota Motor also detracted from performance. The company reported strong earnings in 2021 and raised its guidance for 2022.
Portfolio Positioning
With 2022 on the horizon, global economies continue to confront higher inflation, potentially slower economic growth and continued uncertainty surrounding the coronavirus pandemic. We believe our disciplined investment approach can be particularly beneficial during periods of volatility, and we adhere to our process regardless of the market environment. We believe this allows us to take advantage of opportunities presented by market inefficiencies. We seek to maintain balanced exposure to our fundamentally based, multidimensional drivers of stock returns, applying bottom-up research and analysis on individual stocks to determine positioning. We also seek to limit active risk at the country, sector and industry level, and we typically allow only modest overweights and underweights. As of November 30, 2021, the fund’s largest overweight positions are in the consumer discretionary and information technology sectors. The fund’s largest underweights are in the utilities and real estate sectors. Geographically, the fund is overweight particularly in the U.S., Israel, France and Netherlands and underweight in Europe, particularly to Germany, Switzerland and the U.K.
4
Fund Characteristics |
NOVEMBER 30, 2021 | |||||
Types of Investments in Portfolio | % of net assets | ||||
Common Stocks | 97.9% | ||||
Temporary Cash Investments | 1.3% | ||||
Temporary Cash Investments - Securities Lending Collateral | 0.1% | ||||
Other Assets and Liabilities | 0.7% | ||||
Top Five Countries | % of net assets | ||||
Japan | 23.7% | ||||
United Kingdom | 14.2% | ||||
France | 13.6% | ||||
United States | 7.2% | ||||
Germany | 6.5% |
5
Shareholder Fee Example |
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption/exchange fees; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in your fund and to compare these costs with the ongoing cost of investing in other mutual funds.
The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period from May 29, 2021 to November 30, 2021.
Actual Expenses
The table provides information about actual account values and actual expenses for each class. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. First, identify the share class you own. Then simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The table also provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each class of your fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of a fund’s share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption/exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Beginning Account Value 5/29/21 | Ending Account Value 11/30/21 | Expenses Paid During Period(1) 5/29/21 - 11/30/21 | Annualized Expense Ratio(1) | |||||||||||
Actual | ||||||||||||||
Investor Class | $1,000 | $914.90 | $5.42 | 1.11% | ||||||||||
G Class | $1,000 | $920.80 | $0.05 | 0.01% | ||||||||||
Hypothetical | ||||||||||||||
Investor Class | $1,000 | $1,019.82 | $5.71 | 1.11% | ||||||||||
G Class | $1,000 | $1,025.43 | $0.05 | 0.01% |
(1)Expenses are equal to the class's annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 186, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. Annualized expense ratio reflects actual expenses, including any applicable fee waivers or expense reimbursements and excluding any acquired fund fees and expenses.
6
Schedule of Investments |
NOVEMBER 30, 2021
Shares | Value | |||||||
COMMON STOCKS — 97.9% | ||||||||
Australia — 4.8% | ||||||||
Aristocrat Leisure Ltd. | 434,623 | $ | 13,508,165 | |||||
Coles Group Ltd. | 401,657 | 5,129,076 | ||||||
Commonwealth Bank of Australia | 39,610 | 2,615,101 | ||||||
National Australia Bank Ltd. | 663,562 | 12,822,046 | ||||||
Qantas Airways Ltd.(1) | 1,240,756 | 4,435,318 | ||||||
Rio Tinto Ltd. | 25,070 | 1,663,463 | ||||||
Santos Ltd. | 1,310,864 | 5,910,991 | ||||||
Stockland, REIT | 2,749,930 | 8,489,827 | ||||||
Suncorp Group Ltd. | 367,537 | 2,816,099 | ||||||
Wesfarmers Ltd. | 149,804 | 6,038,513 | ||||||
63,428,599 | ||||||||
Austria — 1.2% | ||||||||
Raiffeisen Bank International AG | 179,618 | 5,341,831 | ||||||
voestalpine AG | 316,091 | 10,667,285 | ||||||
16,009,116 | ||||||||
Belgium — 0.8% | ||||||||
Solvay SA | 92,914 | 10,396,008 | ||||||
Denmark — 0.6% | ||||||||
Novo Nordisk A/S, B Shares | 71,215 | 7,623,563 | ||||||
Finland — 0.3% | ||||||||
Fortum Oyj | 133,097 | 3,826,819 | ||||||
France — 13.6% | ||||||||
Airbus SE(1) | 101,873 | 11,371,072 | ||||||
Arkema SA | 39,896 | 5,231,221 | ||||||
AXA SA | 251,025 | 6,900,186 | ||||||
BNP Paribas SA | 168,489 | 10,471,527 | ||||||
Cie de Saint-Gobain | 222,774 | 14,130,482 | ||||||
Cie Generale des Etablissements Michelin SCA | 118,480 | 17,484,133 | ||||||
Dassault Systemes SE | 99,838 | 6,018,329 | ||||||
EssilorLuxottica SA | 35,202 | 7,054,761 | ||||||
Hermes International | 3,955 | 7,421,972 | ||||||
L'Oreal SA | 7,876 | 3,556,310 | ||||||
Legrand SA | 161,630 | 17,755,856 | ||||||
Publicis Groupe SA | 187,586 | 12,138,465 | ||||||
Sanofi | 49,561 | 4,711,383 | ||||||
Schneider Electric SE | 129,867 | 23,048,006 | ||||||
STMicroelectronics NV | 90,467 | 4,405,905 | ||||||
Thales SA | 45,354 | 3,721,117 | ||||||
TotalEnergies SE | 491,552 | 22,617,665 | ||||||
Veolia Environnement SA | 37,840 | 1,213,500 | ||||||
179,251,890 | ||||||||
Germany — 6.5% | ||||||||
Allianz SE | 77,237 | 16,762,529 | ||||||
Brenntag SE | 125,655 | 10,762,406 | ||||||
Carl Zeiss Meditec AG | 51,268 | 10,271,533 | ||||||
Deutsche Post AG | 87,680 | 5,178,516 |
7
Shares | Value | |||||||
E.ON SE | 515,194 | $ | 6,355,612 | |||||
GEA Group AG | 244,736 | 12,385,510 | ||||||
Merck KGaA | 7,062 | 1,745,409 | ||||||
Siemens AG | 74,899 | 11,940,071 | ||||||
Telefonica Deutschland Holding AG | 1,330,697 | 3,549,142 | ||||||
Uniper SE | 138,638 | 6,019,087 | ||||||
Vitesco Technologies Group AG(1) | 15,645 | 695,526 | ||||||
85,665,341 | ||||||||
Hong Kong — 1.3% | ||||||||
Hong Kong Exchanges & Clearing Ltd. | 192,500 | 10,585,848 | ||||||
Sun Hung Kai Properties Ltd. | 544,000 | 6,624,115 | ||||||
17,209,963 | ||||||||
Ireland — 1.3% | ||||||||
CRH plc | 347,115 | 16,874,876 | ||||||
Israel — 3.6% | ||||||||
Bank Leumi Le-Israel BM | 1,910,803 | 18,386,917 | ||||||
Israel Discount Bank Ltd., A Shares(1) | 2,616,067 | 15,986,303 | ||||||
Mizrahi Tefahot Bank Ltd. | 354,370 | 13,030,620 | ||||||
47,403,840 | ||||||||
Italy — 2.7% | ||||||||
CNH Industrial NV | 233,362 | 3,830,440 | ||||||
Enel SpA | 744,431 | 5,640,824 | ||||||
FinecoBank Banca Fineco SpA | 581,425 | 10,183,060 | ||||||
Mediobanca Banca di Credito Finanziario SpA(2) | 507,877 | 5,618,007 | ||||||
Tenaris SA | 1,006,187 | 9,853,498 | ||||||
35,125,829 | ||||||||
Japan — 23.7% | ||||||||
AGC, Inc. | 80,400 | 3,915,237 | ||||||
Bridgestone Corp. | 160,500 | 6,435,818 | ||||||
Brother Industries Ltd. | 586,100 | 10,058,907 | ||||||
Canon, Inc. | 737,700 | 16,224,032 | ||||||
Capcom Co., Ltd. | 219,200 | 5,455,964 | ||||||
Dai Nippon Printing Co. Ltd. | 112,900 | 2,649,779 | ||||||
ENEOS Holdings, Inc. | 2,042,500 | 7,582,313 | ||||||
FUJIFILM Holdings Corp. | 186,600 | 14,678,155 | ||||||
Fujitsu Ltd. | 22,100 | 3,652,771 | ||||||
Hoya Corp. | 57,800 | 9,148,959 | ||||||
Iida Group Holdings Co. Ltd. | 563,000 | 11,626,148 | ||||||
INPEX Corp. | 652,300 | 5,337,505 | ||||||
Japan Airlines Co. Ltd.(1) | 161,600 | 2,913,015 | ||||||
Japan Exchange Group, Inc. | 215,500 | 4,665,812 | ||||||
Japan Post Insurance Co. Ltd. | 431,100 | 6,659,427 | ||||||
JFE Holdings, Inc. | 205,300 | 2,339,969 | ||||||
KDDI Corp. | 579,700 | 16,820,086 | ||||||
Lixil Corp. | 117,700 | 2,879,418 | ||||||
Mitsubishi Corp. | 204,200 | 6,071,775 | ||||||
Mitsubishi Electric Corp. | 1,127,900 | 14,092,821 | ||||||
Mitsubishi UFJ Financial Group, Inc. | 1,088,300 | 5,747,727 | ||||||
Mitsui & Co. Ltd. | 307,300 | 6,909,153 | ||||||
MS&AD Insurance Group Holdings, Inc. | 304,000 | 8,864,221 | ||||||
Nintendo Co. Ltd. | 11,200 | 4,939,400 | ||||||
Nippon Yusen KK | 50,400 | 3,264,349 |
8
Shares | Value | |||||||
Nitto Denko Corp. | 35,500 | $ | 2,461,179 | |||||
Oriental Land Co. Ltd. | 22,300 | 3,504,107 | ||||||
ORIX Corp. | 481,600 | 9,489,161 | ||||||
Otsuka Holdings Co. Ltd. | 62,900 | 2,278,214 | ||||||
Panasonic Corp. | 869,800 | 9,483,020 | ||||||
Renesas Electronics Corp.(1) | 414,800 | 5,212,095 | ||||||
Seiko Epson Corp. | 488,900 | 7,882,768 | ||||||
Seven & i Holdings Co. Ltd. | 95,300 | 3,838,437 | ||||||
Shionogi & Co. Ltd. | 138,800 | 9,689,805 | ||||||
Shizuoka Bank Ltd. (The) | 1,298,300 | 9,127,149 | ||||||
Softbank Corp. | 162,100 | 2,231,237 | ||||||
Sompo Holdings, Inc. | 81,000 | 3,326,509 | ||||||
Sony Group Corp. | 113,400 | 13,835,786 | ||||||
Sumitomo Chemical Co. Ltd. | 2,783,500 | 12,768,048 | ||||||
Tokyo Electron Ltd. | 11,300 | 5,937,807 | ||||||
Toyota Motor Corp. | 743,000 | 13,180,262 | ||||||
Yamaha Motor Co. Ltd. | 559,300 | 14,065,571 | ||||||
311,243,916 | ||||||||
Netherlands — 3.8% | ||||||||
Koninklijke Ahold Delhaize NV | 597,526 | 20,106,603 | ||||||
NN Group NV | 155,678 | 7,735,556 | ||||||
Randstad NV | 129,699 | 8,184,123 | ||||||
Wolters Kluwer NV | 126,396 | 14,214,601 | ||||||
50,240,883 | ||||||||
New Zealand — 0.3% | ||||||||
Fisher & Paykel Healthcare Corp. Ltd. | 200,081 | 4,526,944 | ||||||
Norway — 1.4% | ||||||||
Equinor ASA | 222,830 | 5,575,418 | ||||||
Yara International ASA | 271,588 | 13,332,328 | ||||||
18,907,746 | ||||||||
Portugal — 1.5% | ||||||||
EDP Renovaveis SA | 126,040 | 3,241,759 | ||||||
Jeronimo Martins SGPS SA | 743,820 | 16,229,703 | ||||||
19,471,462 | ||||||||
Singapore — 2.1% | ||||||||
DBS Group Holdings Ltd. | 597,309 | 13,010,948 | ||||||
Singapore Telecommunications Ltd. | 2,207,600 | 3,801,296 | ||||||
United Overseas Bank Ltd. | 548,900 | 10,273,275 | ||||||
27,085,519 | ||||||||
Spain — 2.6% | ||||||||
Banco Bilbao Vizcaya Argentaria SA | 3,594,863 | 19,058,601 | ||||||
Industria de Diseno Textil SA | 299,383 | 9,463,707 | ||||||
Naturgy Energy Group SA(2) | 210,528 | 5,808,022 | ||||||
34,330,330 | ||||||||
Sweden — 0.6% | ||||||||
Husqvarna AB, B Shares | 10,230 | 144,024 | ||||||
Lundin Energy AB | 207,877 | 7,346,252 | ||||||
7,490,276 | ||||||||
Switzerland — 3.8% | ||||||||
Kuehne + Nagel International AG | 20,500 | 5,860,311 | ||||||
Novartis AG | 184,780 | 14,728,026 | ||||||
Partners Group Holding AG | 5,241 | 9,045,167 |
9
Shares | Value | |||||||
Sonova Holding AG | 13,466 | $ | 5,060,771 | |||||
Straumann Holding AG | 7,080 | 15,051,707 | ||||||
49,745,982 | ||||||||
United Kingdom — 14.2% | ||||||||
Anglo American plc | 181,277 | 6,672,778 | ||||||
Aviva plc | 3,347,881 | 17,086,447 | ||||||
Barclays plc | 1,057,909 | 2,583,074 | ||||||
BHP Group plc | 707,092 | 19,322,028 | ||||||
BP plc | 2,434,157 | 10,561,141 | ||||||
Evraz plc | 1,558,724 | 11,882,651 | ||||||
GlaxoSmithKline plc | 179,484 | 3,644,080 | ||||||
HSBC Holdings plc | 720,066 | 3,979,372 | ||||||
JD Sports Fashion plc | 3,211,495 | 9,497,425 | ||||||
Kingfisher plc | 933,800 | 3,924,038 | ||||||
Legal & General Group plc | 1,636,863 | 6,115,152 | ||||||
Lloyds Banking Group plc | 7,487,372 | 4,649,231 | ||||||
Next plc | 108,628 | 11,348,902 | ||||||
Prudential plc | 183,677 | 3,102,534 | ||||||
Rio Tinto plc | 315,248 | 19,325,997 | ||||||
Royal Dutch Shell plc, A Shares | 607,877 | 12,716,402 | ||||||
Royal Dutch Shell plc, B Shares | 916,111 | 19,197,959 | ||||||
Unilever plc | 204,258 | 10,432,065 | ||||||
Vodafone Group plc | 7,053,358 | 10,226,078 | ||||||
186,267,354 | ||||||||
United States — 7.2% | ||||||||
Alphabet, Inc., Class C(1) | 1,625 | 4,629,690 | ||||||
Amazon.com, Inc.(1) | 1,551 | 5,439,466 | ||||||
American Express Co. | 23,191 | 3,531,989 | ||||||
Blackstone, Inc. | 67,983 | 9,616,195 | ||||||
Broadcom, Inc. | 12,355 | 6,840,716 | ||||||
Chemours Co. (The) | 147,095 | 4,368,722 | ||||||
Crane Co. | 113,108 | 10,919,446 | ||||||
Delta Air Lines, Inc.(1) | 116,866 | 4,230,549 | ||||||
Devon Energy Corp. | 115,177 | 4,844,345 | ||||||
Goldman Sachs Group, Inc. (The) | 10,311 | 3,928,388 | ||||||
Hilton Worldwide Holdings, Inc.(1) | 38,305 | 5,173,856 | ||||||
Horizon Therapeutics plc(1) | 44,521 | 4,619,499 | ||||||
JPMorgan Chase & Co. | 39,327 | 6,246,307 | ||||||
Microsoft Corp. | 20,355 | 6,729,160 | ||||||
Nasdaq, Inc. | 35,054 | 7,124,025 | ||||||
QUALCOMM, Inc. | 34,075 | 6,152,582 | ||||||
94,394,935 | ||||||||
TOTAL COMMON STOCKS (Cost $1,220,307,957) | 1,286,521,191 | |||||||
TEMPORARY CASH INVESTMENTS — 1.3% | ||||||||
Repurchase Agreement, BMO Capital Markets Corp., (collateralized by various U.S. Treasury obligations, 0.125% - 2.625%, 6/30/22 - 5/15/51, valued at $4,139,510), in a joint trading account at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $4,052,704) | 4,052,702 | |||||||
Repurchase Agreement, Fixed Income Clearing Corp., (collateralized by various U.S. Treasury obligations, 1.00%, 7/31/28, valued at $13,787,387), at 0.02%, dated 11/30/21, due 12/1/21 (Delivery value $13,517,008) | 13,517,000 |
10
Shares | Value | |||||||
State Street Institutional U.S. Government Money Market Fund, Premier Class | 62,820 | $ | 62,820 | |||||
TOTAL TEMPORARY CASH INVESTMENTS (Cost $17,632,522) | 17,632,522 | |||||||
TEMPORARY CASH INVESTMENTS - SECURITIES LENDING COLLATERAL(3) — 0.1% | ||||||||
State Street Navigator Securities Lending Government Money Market Portfolio (Cost $923,991) | 923,991 | 923,991 | ||||||
TOTAL INVESTMENT SECURITIES — 99.3% (Cost $1,238,864,470) | 1,305,077,704 | |||||||
OTHER ASSETS AND LIABILITIES — 0.7% | 9,798,842 | |||||||
TOTAL NET ASSETS — 100.0% | $ | 1,314,876,546 |
MARKET SECTOR DIVERSIFICATION | |||||
(as a % of net assets) | |||||
Financials | 23.3% | ||||
Industrials | 15.4% | ||||
Consumer Discretionary | 12.9% | ||||
Materials | 10.5% | ||||
Energy | 8.6% | ||||
Information Technology | 7.1% | ||||
Health Care | 7.1% | ||||
Communication Services | 5.0% | ||||
Consumer Staples | 4.5% | ||||
Utilities | 2.4% | ||||
Real Estate | 1.1% | ||||
Temporary Cash Investments | 1.3% | ||||
Temporary Cash Investments - Securities Lending Collateral | 0.1% | ||||
Other Assets and Liabilities | 0.7% |
NOTES TO SCHEDULE OF INVESTMENTS |
(1)Non-income producing.
(2)Security, or a portion thereof, is on loan. At the period end, the aggregate value of securities on loan was $7,266,381. The amount of securities on loan indicated may not correspond with the securities on loan identified because securities with pending sales are in the process of recall from the brokers.
(3)Investment of cash collateral from securities on loan. At the period end, the aggregate value of the collateral held by the fund was $7,676,272, which includes securities collateral of $6,752,281.
See Notes to Financial Statements.
11
Statement of Assets and Liabilities |
NOVEMBER 30, 2021 | |||||
Assets | |||||
Investment securities, at value (cost of $1,237,940,479) — including $7,266,381 of securities on loan | $ | 1,304,153,713 | |||
Investment made with cash collateral received for securities on loan, at value (cost of $923,991) | 923,991 | ||||
Total investment securities, at value (cost of $1,238,864,470) | 1,305,077,704 | ||||
Foreign currency holdings, at value (cost of $615,647) | 618,301 | ||||
Receivable for capital shares sold | 2,127,947 | ||||
Dividends and interest receivable | 8,140,500 | ||||
Securities lending receivable | 10,301 | ||||
1,315,974,753 | |||||
Liabilities | |||||
Payable for collateral received for securities on loan | 923,991 | ||||
Payable for investments purchased | 660 | ||||
Accrued management fees | 173,556 | ||||
1,098,207 | |||||
Net Assets | $ | 1,314,876,546 | |||
Net Assets Consist of: | |||||
Capital (par value and paid-in surplus) | $ | 1,210,956,951 | |||
Distributable earnings | 103,919,595 | ||||
$ | 1,314,876,546 |
Net Assets | Shares Outstanding | Net Asset Value Per Share | |||||||||
Investor Class, $0.01 Par Value | $184,335,971 | 18,427,894 | $10.00 | ||||||||
G Class, $0.01 Par Value | $1,130,540,575 | 111,860,750 | $10.11 |
See Notes to Financial Statements.
12
Statement of Operations |
YEAR ENDED NOVEMBER 30, 2021 | |||||
Investment Income (Loss) | |||||
Income: | |||||
Dividends (net of foreign taxes withheld of $4,235,086) | $ | 48,172,405 | |||
Securities lending, net | 290,582 | ||||
Interest | 5,556 | ||||
48,468,543 | |||||
Expenses: | |||||
Management fees | 10,412,309 | ||||
Directors' fees and expenses | 33,068 | ||||
Other expenses | 103,099 | ||||
10,548,476 | |||||
Fees waived - G Class | (8,464,156) | ||||
2,084,320 | |||||
Net investment income (loss) | 46,384,223 | ||||
Realized and Unrealized Gain (Loss) | |||||
Net realized gain (loss) on: | |||||
Investment transactions | 153,237,439 | ||||
Futures contract transactions | 1,177,660 | ||||
Foreign currency translation transactions | (89,760) | ||||
154,325,339 | |||||
Change in net unrealized appreciation (depreciation) on: | |||||
Investments | (84,091,757) | ||||
Translation of assets and liabilities in foreign currencies | (203,832) | ||||
(84,295,589) | |||||
Net realized and unrealized gain (loss) | 70,029,750 | ||||
Net Increase (Decrease) in Net Assets Resulting from Operations | $ | 116,413,973 |
See Notes to Financial Statements.
13
Statement of Changes in Net Assets |
YEARS ENDED NOVEMBER 30, 2021 AND NOVEMBER 30, 2020 | ||||||||
Increase (Decrease) in Net Assets | November 30, 2021 | November 30, 2020 | ||||||
Operations | ||||||||
Net investment income (loss) | $ | 46,384,223 | $ | 27,246,315 | ||||
Net realized gain (loss) | 154,325,339 | (36,166,175) | ||||||
Change in net unrealized appreciation (depreciation) | (84,295,589) | 111,575,725 | ||||||
Net increase (decrease) in net assets resulting from operations | 116,413,973 | 102,655,865 | ||||||
Distributions to Shareholders | ||||||||
From earnings: | ||||||||
Investor Class | (2,888,176) | (6,226,904) | ||||||
G Class | (31,084,298) | (29,641,753) | ||||||
Decrease in net assets from distributions | (33,972,474) | (35,868,657) | ||||||
Capital Share Transactions | ||||||||
Net increase (decrease) in net assets from capital share transactions (Note 5) | 28,112,456 | 315,024,875 | ||||||
Net increase (decrease) in net assets | 110,553,955 | 381,812,083 | ||||||
Net Assets | ||||||||
Beginning of period | 1,204,322,591 | 822,510,508 | ||||||
End of period | $ | 1,314,876,546 | $ | 1,204,322,591 |
See Notes to Financial Statements.
14
Notes to Financial Statements |
NOVEMBER 30, 2021
1. Organization
American Century World Mutual Funds, Inc. (the corporation) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company and is organized as a Maryland corporation. NT International Value Fund (the fund) is one fund in a series issued by the corporation. The fund’s investment objective is to seek long-term capital growth. The fund offers the Investor Class and G Class.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently followed by the fund in preparation of its financial statements. The fund is an investment company and follows accounting and reporting guidance in accordance with accounting principles generally accepted in the United States of America. This may require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from these estimates. Management evaluated the impact of events or transactions occurring through the date the financial statements were issued that would merit recognition or disclosure.
Investment Valuations — The fund determines the fair value of its investments and computes its net asset value (NAV) per share at the close of regular trading (usually 4 p.m. Eastern time) on the New York Stock Exchange (NYSE) on each day the NYSE is open. The Board of Directors has adopted valuation policies and procedures to guide the investment advisor in the fund’s investment valuation process and to provide methodologies for the oversight of the fund’s pricing function.
Equity securities that are listed or traded on a domestic securities exchange are valued at the last reported sales price or at the official closing price as provided by the exchange. Equity securities traded on foreign securities exchanges are generally valued at the closing price of such securities on the exchange where primarily traded or at the close of the NYSE, if that is earlier. If no last sales price is reported, or if local convention or regulation so provides, the mean of the latest bid and asked prices may be used. Securities traded over-the-counter are valued at the mean of the latest bid and asked prices, the last sales price, or the official closing price. Equity securities initially expressed in local currencies are translated into U.S. dollars at the mean of the appropriate currency exchange rate at the close of the NYSE as provided by an independent pricing service.
Open-end management investment companies are valued at the reported NAV per share. Repurchase agreements are valued at cost, which approximates fair value. Exchange-traded futures contracts are valued at the settlement price as provided by the appropriate exchange.
If the fund determines that the market price for an investment is not readily available or the valuation methods mentioned above do not reflect an investment’s fair value, such investment is valued as determined in good faith by the Board of Directors or its delegate, in accordance with policies and procedures adopted by the Board of Directors. In its determination of fair value, the fund may review several factors including, but not limited to, market information regarding the specific investment or comparable investments and correlation with other investment types, futures indices or general market indicators. Circumstances that may cause the fund to use these procedures to value an investment include, but are not limited to: an investment has been declared in default or is distressed; trading in a security has been suspended during the trading day or a security is not actively trading on its principal exchange; prices received from a regular pricing source are deemed unreliable; or there is a foreign market holiday and no trading occurred.
15
The fund monitors for significant events occurring after the close of an investment’s primary exchange but before the fund’s NAV per share is determined. Significant events may include, but are not limited to: corporate announcements and transactions; governmental action and political unrest that could impact a specific investment or an investment sector; or armed conflicts, natural disasters and similar events that could affect investments in a specific country or region. The fund also monitors for significant fluctuations between domestic and foreign markets, as evidenced by the U.S. market or such other indicators that the Board of Directors, or its delegate, deems appropriate. The fund may apply a model-derived factor to the closing price of equity securities traded on foreign securities exchanges. The factor is based on observable market data as provided by an independent pricing service.
Security Transactions — Security transactions are accounted for as of the trade date. Net realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes.
Investment Income — Dividend income less foreign taxes withheld, if any, is recorded as of the ex-dividend date. Distributions received on securities that represent a return of capital or long-term capital gain are recorded as a reduction of cost of investments and/or as a realized gain. The fund may estimate the components of distributions received that may be considered nontaxable distributions or long-term capital gain distributions for income tax purposes. Interest income is recorded on the accrual basis and includes accretion of discounts and amortization of premiums. Securities lending income is net of fees and rebates earned by the lending agent for its services.
Foreign Currency Translations — All assets and liabilities initially expressed in foreign currencies are translated into U.S. dollars at prevailing exchange rates at period end. The fund may enter into spot foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of investment securities, dividend and interest income, spot foreign currency exchange contracts, and expenses are translated at the rates of exchange prevailing on the respective dates of such transactions. Net realized and unrealized foreign currency exchange gains or losses related to investment securities are a component of net realized gain (loss) on investment transactions and change in net unrealized appreciation (depreciation) on investments, respectively.
Repurchase Agreements — The fund may enter into repurchase agreements with institutions that American Century Investment Management, Inc. (ACIM) (the investment advisor) has determined are creditworthy pursuant to criteria adopted by the Board of Directors. The fund requires that the collateral, represented by securities, received in a repurchase transaction be transferred to the custodian in a manner sufficient to enable the fund to obtain those securities in the event of a default under the repurchase agreement. ACIM monitors, on a daily basis, the securities transferred to ensure the value, including accrued interest, of the securities under each repurchase agreement is equal to or greater than amounts owed to the fund under each repurchase agreement.
Joint Trading Account — Pursuant to an Exemptive Order issued by the Securities and Exchange Commission, the fund, along with certain other funds in the American Century Investments family of funds, may transfer uninvested cash balances into a joint trading account. These balances are invested in one or more repurchase agreements that are collateralized by U.S. Treasury or Agency obligations.
Segregated Assets — In accordance with the 1940 Act, the fund segregates assets on its books and records to cover certain types of investment securities and other financial instruments. ACIM monitors, on a daily basis, the securities segregated to ensure the fund designates a sufficient amount of liquid assets, marked-to-market daily. The fund may also receive assets or be required to pledge assets at the custodian bank or with a broker for collateral requirements.
Income Tax Status — It is the fund’s policy to distribute substantially all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code. Accordingly, no provision has been made for income taxes. The fund files U.S. federal, state, local and non-U.S. tax returns as applicable. The fund's tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years from the date of filing but can be longer in certain jurisdictions. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
16
Multiple Class — All shares of the fund represent an equal pro rata interest in the net assets of the class to which such shares belong, and have identical voting, dividend, liquidation and other rights and the same terms and conditions, except for class specific expenses and exclusive rights to vote on matters affecting only individual classes. Income, non-class specific expenses, and realized and unrealized capital gains and losses of the fund are allocated to each class of shares based on their relative net assets.
Distributions to Shareholders — Distributions from net investment income and net realized gains, if any, are generally declared and paid annually. The fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code, in all events in a manner consistent with provisions of the 1940 Act. The fund may elect to treat a portion of its payment to a redeeming shareholder,
which represents the pro rata share of undistributed net investment income and net realized gains, as a
distribution for federal income tax purposes (tax equalization).
Indemnifications — Under the corporation’s organizational documents, its officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business, the fund enters into contracts that provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against a fund. The risk of material loss from such claims is considered by management to be remote.
Securities Lending — Securities are lent to qualified financial institutions and brokers. State Street Bank & Trust Co. serves as securities lending agent to the fund pursuant to a Securities Lending Agreement. The lending of securities exposes the fund to risks such as: the borrowers may fail to return the loaned securities, the borrowers may not be able to provide additional collateral, the fund may experience delays in recovery of the loaned securities or delays in access to collateral, or the fund may experience losses related to the investment collateral. To minimize certain risks, loan counterparties pledge collateral in the form of cash and/or securities. The lending agent has agreed to indemnify the fund in the case of default of any securities borrowed. Cash collateral received is invested in the State Street Navigator Securities Lending Government Money Market Portfolio, a money market mutual fund registered under the 1940 Act. The loans may also be secured by U.S. government securities in an amount at least equal to the market value of the securities loaned, plus accrued interest and dividends, determined on a daily basis and adjusted accordingly. By lending securities, the fund seeks to increase its net investment income through the receipt of interest and fees. Such income is reflected separately within the Statement of Operations. The value of loaned securities and related collateral outstanding at period end, if any, are shown on a gross basis within the Schedule of Investments and Statement of Assets and Liabilities.
The following table reflects a breakdown of transactions accounted for as secured borrowings, the gross obligation by the type of collateral pledged, and the remaining contractual maturity of those transactions as of November 30, 2021.
Remaining Contractual Maturity of Agreements | |||||||||||||||||
Overnight and Continuous | <30 days | Between 30 & 90 days | >90 days | Total | |||||||||||||
Securities Lending Transactions(1) | |||||||||||||||||
Common Stocks | $ | 923,991 | — | — | — | $ | 923,991 | ||||||||||
Gross amount of recognized liabilities for securities lending transactions | $ | 923,991 |
(1)Amount represents the payable for cash collateral received for securities on loan. This will generally be in the Overnight and Continuous column as the securities are typically callable on demand.
3. Fees and Transactions with Related Parties
Certain officers and directors of the corporation are also officers and/or directors of American Century Companies, Inc. (ACC). The corporation’s investment advisor, ACIM, the corporation's distributor, American Century Investment Services, Inc., and the corporation’s transfer agent, American Century Services, LLC, are wholly owned, directly or indirectly, by ACC. Various funds issued by American Century Asset Allocation Portfolios, Inc. own, in aggregate, 59% of the shares of the fund. Related parties do not invest in the fund for the purpose of exercising management or control.
17
Management Fees — The corporation has entered into a management agreement with ACIM, under which ACIM provides the fund with investment advisory and management services in exchange for a single, unified management fee (the fee) per class. The agreement provides that ACIM will pay all expenses of managing and operating the fund, except brokerage expenses, taxes, interest, fees and expenses of the independent directors (including legal counsel fees), and extraordinary expenses. The fee is computed and accrued daily based on each class's daily net assets and paid monthly in arrears. The difference in the fee among the classes is a result of their separate arrangements for non-Rule 12b-1 shareholder services, which may be provided indirectly through another American Century Investments mutual fund. It is not the result of any difference in advisory or custodial fees or other expenses related to the management of the fund’s assets, which do not vary by class. The investment advisor agreed to waive the G Class's management fee in its entirety. The investment advisor expects this waiver to remain in effect permanently and cannot terminate it without the approval of the Board of Directors.
The annual management fee for each class is as follows:
Investor Class | G Class | ||||
1.10% | 0.00%(1) |
(1)Annual management fee before waiver was 0.75%.
Directors' Fees and Expenses — The Board of Directors is responsible for overseeing the investment advisor’s management and operations of the fund. The directors receive detailed information about the fund and its investment advisor regularly throughout the year, and meet at least quarterly with management of the investment advisor to review reports about fund operations. The fund’s officers do not receive compensation from the fund.
Interfund Transactions — The fund may enter into security transactions with other American Century Investments funds and other client accounts of the investment advisor, in accordance with the 1940 Act rules and procedures adopted by the Board of Directors. The rules and procedures require, among other things, that these transactions be effected at the independent current market price of the security. During the period, the interfund purchases were $2,462,159 and there were no interfund sales.
4. Investment Transactions
Purchases and sales of investment securities, excluding short-term investments, for the period ended November 30, 2021 were $1,813,872,569 and $1,789,820,801, respectively.
5. Capital Share Transactions
Transactions in shares of the fund were as follows:
Year ended November 30, 2021 | Year ended November 30, 2020 | |||||||||||||
Shares | Amount | Shares | Amount | |||||||||||
Investor Class/Shares Authorized | 250,000,000 | 250,000,000 | ||||||||||||
Sold | 2,361,680 | $ | 24,979,402 | 1,623,638 | $ | 12,336,149 | ||||||||
Issued in reinvestment of distributions | 304,339 | 2,888,176 | 688,817 | 6,226,904 | ||||||||||
Redeemed | (1,186,557) | (11,351,550) | (5,402,505) | (46,685,537) | ||||||||||
1,479,462 | 16,516,028 | (3,090,050) | (28,122,484) | |||||||||||
G Class/Shares Authorized | 925,000,000 | 925,000,000 | ||||||||||||
Sold | 16,493,818 | 173,208,787 | 56,753,068 | 478,176,161 | ||||||||||
Issued in reinvestment of distributions | 3,275,479 | 31,084,298 | 3,282,586 | 29,641,753 | ||||||||||
Redeemed | (18,819,590) | (192,696,657) | (19,089,694) | (164,670,555) | ||||||||||
949,707 | 11,596,428 | 40,945,960 | 343,147,359 | |||||||||||
Net increase (decrease) | 2,429,169 | $ | 28,112,456 | 37,855,910 | $ | 315,024,875 |
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6. Fair Value Measurements
The fund’s investments valuation process is based on several considerations and may use multiple inputs to determine the fair value of the investments held by the fund. In conformity with accounting principles generally accepted in the United States of America, the inputs used to determine a valuation are classified into three broad levels.
•Level 1 valuation inputs consist of unadjusted quoted prices in an active market for identical investments.
•Level 2 valuation inputs consist of direct or indirect observable market data (including quoted prices for comparable investments, evaluations of subsequent market events, interest rates, prepayment speeds, credit risk, etc.). These inputs also consist of quoted prices for identical investments initially expressed in local currencies that are adjusted through translation into U.S. dollars.
•Level 3 valuation inputs consist of unobservable data (including a fund’s own assumptions).
The level classification is based on the lowest level input that is significant to the fair valuation measurement. The valuation inputs are not necessarily an indication of the risks associated with investing in these securities or other financial instruments.
The following is a summary of the level classifications as of period end. The Schedule of Investments provides additional information on the fund’s portfolio holdings.
Level 1 | Level 2 | Level 3 | |||||||||
Assets | |||||||||||
Investment Securities | |||||||||||
Common Stocks | |||||||||||
United States | $ | 94,394,935 | — | — | |||||||
Other Countries | — | $ | 1,192,126,256 | — | |||||||
Temporary Cash Investments | 62,820 | 17,569,702 | — | ||||||||
Temporary Cash Investments - Securities Lending Collateral | 923,991 | — | — | ||||||||
$ | 95,381,746 | $ | 1,209,695,958 | — |
7. Derivative Instruments
Equity Price Risk — The fund is subject to equity price risk in the normal course of pursuing its investment objectives. A fund may enter into futures contracts based on an equity index in order to manage its exposure to changes in market conditions. A fund may purchase futures contracts to gain exposure to increases in market value or sell futures contracts to protect against a decline in market value. Upon entering into a futures contract, a fund is required to deposit either cash or securities in an amount equal to a certain percentage of the contract value (initial margin). Subsequent payments (variation margin) are made or received daily, in cash, by a fund. The variation margin is equal to the daily change in the contract value and is recorded as unrealized gains and losses. A fund recognizes a realized gain or loss when the contract is closed or expires. Net realized and unrealized gains or losses occurring during the holding period of futures contracts are a component of net realized gain (loss) on futures contract transactions and change in net unrealized appreciation (depreciation) on futures contracts, respectively. One of the risks of entering into futures contracts is the possibility that the change in value of the contract may not correlate with the changes in value of the underlying securities. The fund's average notional exposure to equity price risk derivative instruments held during the period was $22,439,738 futures contracts purchased.
At period end, the fund did not have any derivative instruments disclosed on the Statement of Assets and Liabilities. For the year ended November 30, 2021, the effect of equity price risk derivative instruments on the Statement of Operations was $1,177,660 in net realized gain (loss) on futures contract transactions.
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8. Risk Factors
The value of the fund’s shares will go up and down, sometimes rapidly or unpredictably, based on the performance of the securities owned by the fund and other factors generally affecting the securities market. Market risks, including political, regulatory, economic and social developments, can affect the value of the fund’s investments. Natural disasters, public health emergencies, terrorism and other unforeseeable events may lead to increased market volatility and may have adverse long-term effects on world economies and markets generally.
There are certain risks involved in investing in foreign securities. These risks include those resulting from political events (such as civil unrest, national elections and imposition of exchange controls), social and economic events (such as labor strikes and rising inflation), and natural disasters. Securities of foreign issuers may be less liquid and more volatile. Investing in emerging markets or a significant portion of assets in one country or region may accentuate these risks.
The fund invests in common stocks of small companies. Because of this, the fund may be subject to greater risk and market fluctuations than a fund investing in larger, more established companies.
The fund is owned by a relatively small number of shareholders, and in the event such shareholders redeem, the ongoing operations of the fund may be at risk.
The fund’s investment process may result in high portfolio turnover, which could mean high transaction costs, affecting both performance and capital gains tax liabilities to investors.
9. Federal Tax Information
On December 21, 2021, the fund declared and paid a per-share distribution from net realized gains to shareholders of record on December 20, 2021 of $0.5397 for the Investor Class and G Class.
On December 21, 2021, the fund declared and paid the following per-share distributions from net investment income to shareholders of record on December 20, 2021:
Investor Class | G Class | ||||
$0.4006 | $0.5120 |
The tax character of distributions paid during the years ended November 30, 2021 and November 30, 2020 were as follows:
2021 | 2020 | |||||||
Distributions Paid From | ||||||||
Ordinary income | $ | 33,972,474 | $ | 35,868,657 | ||||
Long-term capital gains | — | — |
The book-basis character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements.
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As of period end, the federal tax cost of investments and the components of distributable earnings on a tax-basis were as follows:
Federal tax cost of investments | $ | 1,255,166,788 | |||
Gross tax appreciation of investments | $ | 113,405,035 | |||
Gross tax depreciation of investments | (63,494,119) | ||||
Net tax appreciation (depreciation) of investments | 49,910,916 | ||||
Net tax appreciation (depreciation) on derivatives and translation of assets and liabilities in foreign currencies | (16,904) | ||||
Net tax appreciation (depreciation) | $ | 49,894,012 | |||
Undistributed ordinary income | $ | 106,743,990 | |||
Accumulated long-term gains | $ | 28,001,086 | |||
Accumulated short-term capital losses | $ | (64,865,395) | |||
Accumulated long-term capital losses | $ | (15,854,098) |
The difference between book-basis and tax-basis unrealized appreciation (depreciation) is attributable primarily to the tax deferral of losses on wash sales.
Accumulated capital losses represent net capital loss carryovers that may be used to offset future realized capital gains for federal income tax purposes. The capital loss carryovers may be carried forward for an unlimited period. As a result of a shift in ownership of the fund, the utilization of these capital losses in any given year are limited. Any remaining accumulated gains after application of this limitation will be distributed to shareholders.
10. Corporate Event
On December 2, 2021, the Board of Directors approved an agreement and plan of reorganization (the reorganization), whereby the net assets of the fund will be transferred to International Value Fund, one fund in a series issued by the corporation, in exchange for shares of International Value Fund. The financial statements and performance history of International Value Fund will survive after the reorganization. The reorganization is expected to be completed in 2022.
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Financial Highlights |
For a Share Outstanding Throughout the Years Ended November 30 (except as noted) | |||||||||||||||||||||||||||||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||||||||||||||||||||||||||||
Income From Investment Operations: | Ratio to Average Net Assets of: | ||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Distributions From Net Investment Income | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Operating Expenses (before expense waiver) | Net Investment Income (Loss) | Net Investment Income (Loss) (before expense waiver) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||||||||||||||||||||||||||||
Investor Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $9.33 | 0.27 | 0.58 | 0.85 | (0.18) | $10.00 | 9.25% | 1.11% | 1.11% | 2.60% | 2.60% | 141% | $184,336 | ||||||||||||||||||||||||||||
2020 | $9.06 | 0.17 | 0.41 | 0.58 | (0.31) | $9.33 | 6.47% | 1.20% | 1.21% | 2.19% | 2.18% | 100% | $158,100 | ||||||||||||||||||||||||||||
2019 | $9.00 | 0.28 | 0.02 | 0.30 | (0.24) | $9.06 | 3.56% | 1.29% | 1.29% | 3.20% | 3.20% | 82% | $181,458 | ||||||||||||||||||||||||||||
2018 | $10.53 | 0.25 | (1.47) | (1.22) | (0.31) | $9.00 | (11.95)% | 1.29% | 1.29% | 2.48% | 2.48% | 76% | $219,273 | ||||||||||||||||||||||||||||
2017 | $8.73 | 0.24 | 1.83 | 2.07 | (0.27) | $10.53 | 24.32% | 1.29% | 1.29% | 2.44% | 2.44% | 79% | $242,242 | ||||||||||||||||||||||||||||
G Class | |||||||||||||||||||||||||||||||||||||||||
2021 | $9.43 | 0.39 | 0.59 | 0.98 | (0.30) | $10.11 | 10.58% | 0.01% | 0.76% | 3.70% | 2.95% | 141% | $1,130,541 | ||||||||||||||||||||||||||||
2020 | $9.16 | 0.28 | 0.42 | 0.70 | (0.43) | $9.43 | 7.82% | 0.01% | 0.86% | 3.38% | 2.53% | 100% | $1,046,222 | ||||||||||||||||||||||||||||
2019 | $9.11 | 0.40 | —(3) | 0.40 | (0.35) | $9.16 | 4.77% | 0.00%(4) | 0.94% | 4.49% | 3.55% | 82% | $641,053 | ||||||||||||||||||||||||||||
2018 | $10.59 | 0.38 | (1.48) | (1.10) | (0.38) | $9.11 | (10.79)% | 0.01% | 0.94% | 3.76% | 2.83% | 76% | $616,338 | ||||||||||||||||||||||||||||
2017 | $8.75 | 0.29 | 1.84 | 2.13 | (0.29) | $10.59 | 24.99% | 0.69% | 1.04% | 3.04% | 2.69% | 79% | $710,717 |
Notes to Financial Highlights |
(1)Computed using average shares outstanding throughout the period.
(2)Total returns are calculated based on the net asset value of the last business day. Total returns for periods less than one year are not annualized.
(3)Per-share amount was less than $0.005.
(4)Ratio was less than 0.005%.
See Notes to Financial Statements.
Report of Independent Registered Public Accounting Firm |
To the Shareholders and the Board of Directors of American Century World Mutual Funds, Inc.:
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of NT International Value Fund (the “Fund”), one of the funds constituting the American Century World Mutual Funds, Inc., as of November 30, 2021, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of NT International Value Fund of the American Century World Mutual Funds, Inc. as of November 30, 2021, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund’s financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. 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, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of November 30, 2021, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
/s/ Deloitte & Touche LLP
Kansas City, Missouri
January 19, 2022
We have served as the auditor of one or more American Century investment companies since 1997.
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Management |
The Board of Directors
The individuals listed below serve as directors of the funds. Each director will continue to serve in this capacity until death, retirement, resignation or removal from office. The board has adopted a mandatory retirement age for directors who are not “interested persons,” as that term is defined in the Investment Company Act (independent directors). Independent directors shall retire by December 31 of the year in which they reach their 75th birthday.
Jonathan S. Thomas is an “interested person” because he currently serves as President and Chief Executive Officer of American Century Companies, Inc. (ACC), the parent company of American Century Investment Management, Inc. (ACIM or the advisor). The other directors (more than three-fourths of the total number) are independent. They are not employees, directors or officers of, and have no financial interest in, ACC or any of its wholly owned, direct or indirect, subsidiaries, including ACIM, American Century Investment Services, Inc. (ACIS) and American Century Services, LLC (ACS), and they do not have any other affiliations, positions or relationships that would cause them to be considered “interested persons” under the Investment Company Act. The directors serve in this capacity for seven (in the case of Jonathan S. Thomas, 16; and Stephen E. Yates, 8) registered investment companies in the American Century Investments family of funds.
The following table presents additional information about the directors. The mailing address for each director is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Thomas W. Bunn (1953) | Director | Since 2017 | Retired | 72 | SquareTwo Financial; Barings (formerly Babson Capital Funds Trust) (2013 to 2016) | ||||||||||||
Chris H. Cheesman (1962) | Director | Since 2019 | Retired. Senior Vice President & Chief Audit Executive, AllianceBernstein (1999 to 2018) | 72 | Alleghany Corporation | ||||||||||||
Barry Fink (1955) | Director | Since 2012 (independent since 2016) | Retired | 72 | None | ||||||||||||
Rajesh K. Gupta (1960) | Director | Since 2019 | Partner Emeritus, SeaCrest Investment Management and SeaCrest Wealth Management (2019 to Present); Chief Executive Officer and Chief Investment Officer, SeaCrest Investment Management (2006 to 2019); Chief Executive Officer and Chief Investment Officer, SeaCrest Wealth Management (2008 to 2019) | 72 | None |
24
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Director | Other Directorships Held During Past 5 Years | ||||||||||||
Independent Directors | |||||||||||||||||
Lynn Jenkins (1963) | Director | Since 2019 | Consultant, LJ Strategies (2019 to present); United States Representative, U.S. House of Representatives (2009 to 2018) | 72 | MGP Ingredients, Inc. (2019 to 2021) | ||||||||||||
Jan M. Lewis (1957) | Director | Since 2011 | Retired | 72 | None | ||||||||||||
John R. Whitten(1) (1946) | Director | Since 2008 | Retired | 72 | Onto Innovation Inc. (2019 to 2020); Rudolph Technologies, Inc. (2006 to 2019) | ||||||||||||
Stephen E. Yates (1948) | Director and Chairman of the Board | Since 2012 (Chairman since 2018) | Retired | 108 | None | ||||||||||||
Interested Director | |||||||||||||||||
Jonathan S. Thomas (1963) | Director | Since 2007 | President and Chief Executive Officer, ACC (2007 to present). Also serves as Chief Executive Officer, ACS; Director, ACC and other ACC subsidiaries | 146 | None |
(1) Effective December 31, 2021, John R. Whitten retired from the Board of Directors.
The Statement of Additional Information has additional information about the fund's directors and is available without charge, upon request, by calling 1-800-345-2021.
25
Officers
The following table presents certain information about the executive officers of the funds. Each officer serves as an officer for each of the 16 (in the case of Robert J. Leach, 15) investment companies in the American Century family of funds. No officer is compensated for his or her service as an officer of the funds. The listed officers are interested persons of the funds and are appointed or re-appointed on an annual basis. The mailing address for each officer listed below is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Offices with the Funds | Principal Occupation(s) During the Past Five Years | ||||||
Patrick Bannigan (1965) | President since 2019 | Executive Vice President and Director, ACC (2012 to present); Chief Financial Officer, Chief Accounting Officer and Treasurer, ACC (2015 to present). Also serves as President, ACS; Vice President, ACIM; Chief Financial Officer, Chief Accounting Officer and/or Director, ACIM, ACS and other ACC subsidiaries | ||||||
R. Wes Campbell (1974) | Chief Financial Officer and Treasurer since 2018 | Vice President, ACS, (2020 to present); Investment Operations and Investment Accounting, ACS (2000 to present) | ||||||
Amy D. Shelton (1964) | Chief Compliance Officer and Vice President since 2014 | Chief Compliance Officer, American Century funds, (2014 to present); Chief Compliance Officer, ACIM (2014 to present); Chief Compliance Officer, ACIS (2009 to present). Also serves as Vice President, ACIS | ||||||
John Pak (1968) | General Counsel and Senior Vice President since 2021 | General Counsel and Senior Vice President, ACC (2021 to present). Also serves as General Counsel and Senior Vice President, ACIM, ACS and ACIS. Chief Legal Officer of Investment and Wealth Management, The Bank of New York Mellon (2014 to 2021) | ||||||
C. Jean Wade (1964) | Vice President since 2012 | Senior Vice President, ACS (2017 to present); Vice President, ACS (2000 to 2017) | ||||||
Robert J. Leach (1966) | Vice President since 2006 | Vice President, ACS (2000 to present) | ||||||
David H. Reinmiller (1963) | Vice President since 2000 | Attorney, ACC (1994 to present). Also serves as Vice President, ACIM and ACS | ||||||
Ward D. Stauffer (1960) | Secretary since 2005 | Attorney, ACC (2003 to present) |
26
Approval of Management Agreement |
At a meeting held on June 30, 2021, the Fund’s Board of Directors (the "Board") unanimously approved the renewal of the management agreement pursuant to which American Century Investment Management, Inc. (the “Advisor”) acts as the investment advisor for the Fund. Under Section 15(c) of the Investment Company Act, contracts for investment advisory services are required to be reviewed, evaluated, and approved by a majority of a fund’s directors (the “Directors”), including a majority of the independent Directors, each year.
Prior to its consideration of the renewal of the management agreement, the Directors requested and reviewed extensive data and information compiled by the Advisor and certain independent providers of evaluation data concerning the Fund and the services provided to the Fund by the Advisor. This review was in addition to the oversight and evaluation undertaken by the Board and its committees on a continual basis and the information received was supplemental to the extensive information that the Board and its committees receive and consider throughout the year.
In connection with its consideration of the renewal of the management agreement, the Board’s review and evaluation of the services provided by the Advisor and its affiliates included, but was not limited to, the following:
•the nature, extent, and quality of investment management, shareholder services, and other services provided and to be provided to the Fund including without limitation portfolio management and trading services, shareholder and intermediary services, compliance and legal services, fund accounting and financial reporting, and fund share distribution;
•the wide range of other programs and services provided and to be provided to the Fund and its shareholders on a routine and non-routine basis;
•the Fund’s investment performance, including data comparing the Fund's performance to appropriate benchmarks and/or a peer group of other mutual funds with similar investment objectives and strategies;
•the cost of owning the Fund compared to the cost of owning similar funds;
•the compliance policies, procedures, and regulatory experience of the Advisor and the Fund's service providers;
•the Advisor’s strategic plans, COVID-19 pandemic response, vendor management practices, and social justice initiatives;
•the Advisor’s business continuity plans and cyber security practices;
•financial data showing the cost of services provided to the Fund, the profitability of the Fund to the Advisor, and the overall profitability of the Advisor;
•possible economies of scale associated with the Advisor’s management of the Fund and other accounts;
•services provided and charges to the Advisor's other investment management clients;
•acquired fund fees and expenses;
•payments and practices in connection with financial intermediaries holding shares of the Fund and the services provided by intermediaries in connection therewith; and
•possible collateral benefits to the Advisor from the management of the Fund.
The Board held two meetings to consider the renewal. The independent Directors also met in private session three times to review and discuss the information provided in response to their request. The independent Directors held active discussions with the Advisor regarding the renewal of the management agreement, requesting supplemental information, and reviewing information provided by the Advisor in response thereto. The independent Directors had the benefit of the advice of their independent counsel throughout the process.
27
Factors Considered
The Directors considered all of the information provided by the Advisor, the independent data providers, and independent counsel in connection with the approval. They determined that the information was sufficient for them to evaluate the management agreement for the Fund. In connection with their review, the Directors did not identify any single factor as being all-important or controlling, and each Director may have attributed different levels of importance to different factors. In deciding to renew the management agreement, the Board based its decision on a number of factors, including without limitation the following:
Nature, Extent and Quality of Services — Generally. Under the management agreement, the Advisor is responsible for providing or arranging for all services necessary for the operation of the Fund. The Board noted that the Advisor provides or arranges at its own expense a wide variety of services which include the following:
•constructing and designing the Fund
•portfolio research and security selection
•initial capitalization/funding
•securities trading
•Fund administration
•custody of Fund assets
•daily valuation of the Fund’s portfolio
•liquidity monitoring and management
•risk management, including cyber security
•shareholder servicing and transfer agency, including shareholder confirmations, recordkeeping, and communications
•legal services (except the independent Directors’ counsel)
•regulatory and portfolio compliance
•financial reporting
•marketing and distribution (except amounts paid by the Fund under Rule 12b-1 plans)
The Board noted that many of these services have expanded over time in terms of both quantity and complexity in response to shareholder demands, competition in the industry, changing distribution channels, and the changing regulatory environment.
Investment Management Services. The nature of the investment management services provided to the Fund is quite complex and allows Fund shareholders access to professional money management, instant diversification of their investments within an asset class, the opportunity to easily diversify among asset classes by investing in or exchanging among various American Century Investments funds, and liquidity. In evaluating investment performance, the Board expects the Advisor to manage the Fund in accordance with its investment objectives and approved strategies. Further, the Directors recognize that the Advisor has an obligation to monitor trading activities, and in particular to seek the best execution of fund trades, and to evaluate the use of and payment for research. In providing these services, the Advisor utilizes teams of investment professionals (portfolio managers, analysts, research assistants, and securities traders) who require extensive information technology, research, training, compliance, and other systems to conduct their business. The Board, directly and through its Fund Performance Review Committee, provides oversight of the investment performance process. It regularly reviews investment performance information for the Fund, together with comparative information for appropriate benchmarks and/or peer groups of similarly-managed funds, over different time horizons. The Directors also review investment performance information during the management agreement renewal process. If performance concerns are identified, the Fund receives special reviews until performance improves, during which the Board discusses with the Advisor the reasons for such results (e.g., market conditions, security selection) and any efforts being undertaken to improve performance. The Fund’s performance was above its benchmark for the one-, three-, and five-year periods reviewed by the Board. The Board discussed the Fund's performance with the Advisor, including steps being taken to address underperformance, and was satisfied with the efforts being
28
undertaken by the Advisor. The Board found the investment management services provided by the Advisor to the Fund to be satisfactory and consistent with the management agreement.
Shareholder and Other Services. Under the management agreement, the Advisor provides the Fund with a comprehensive package of transfer agency, shareholder, and other services. The Board, directly and through its various committees, regularly reviews reports and evaluations of such services at its regular meetings. These reports include, but are not limited to, information regarding the operational efficiency and accuracy of the shareholder and transfer agency services provided, staffing levels, shareholder satisfaction, technology support (including cyber security), new products and services offered to Fund shareholders, securities trading activities, portfolio valuation services, auditing services, and legal and operational compliance activities. The Board found the services provided by the Advisor to the Fund under the management agreement to be competitive and of high quality.
Costs of Services and Profitability. The Advisor provides detailed information concerning its cost of providing various services to the Fund, its profitability in managing the Fund (pre- and post-distribution), its overall profitability, and its financial condition. The Directors have reviewed with the Advisor the methodology used to prepare this financial information. This information is considered in evaluating the Advisor’s financial condition, its ability to continue to provide services under the management agreement, and the reasonableness of the current management fee. The Board concluded that the Advisor’s profits were reasonable in light of the services provided to the Fund.
Ethics. The Board generally considers the Advisor’s commitment to providing quality services to shareholders and to conducting its business ethically. They noted that the Advisor’s practices generally meet or exceed industry best practices.
Economies of Scale. The Board also reviewed information provided by the Advisor regarding the possible existence of economies of scale in connection with the management of the Fund. The Board concluded that economies of scale are difficult to measure and predict with precision, especially on a fund-by-fund basis. The Board concluded that the Advisor is sharing economies of scale, to the extent they exist, through its competitive fee structure, offering competitive fees from fund inception, and through reinvestment in its business, infrastructure, investment capabilities and initiatives to provide shareholders additional content and services.
Comparison to Other Funds’ Fees. The management agreement provides that the Fund pays the Advisor a single, all-inclusive (or unified) management fee for providing all services necessary for the management and operation of the Fund, other than brokerage expenses, expenses attributable to short sales, taxes, interest, extraordinary expenses, fees and expenses of the Fund’s independent Directors (including their independent legal counsel), and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the Investment Company Act. Under the unified fee structure, the Advisor is responsible for providing all investment advisory, custody, audit, administrative, compliance, recordkeeping, marketing and shareholder services, or arranging and supervising third parties to provide such services. By contrast, most other funds are charged a variety of fees, including an investment advisory fee, a transfer agency fee, an administrative fee, distribution charges, and other expenses. Other than their investment advisory fees and any applicable Rule 12b-1 distribution fees, all other components of the total fees charged by these other funds may be increased without shareholder approval. The Board believes the unified fee structure is a benefit to Fund shareholders because it clearly discloses to shareholders the cost of owning Fund shares, and, since the unified fee cannot be increased without a vote of Fund shareholders, it shifts to the Advisor the risk of increased costs of operating the Fund and provides a direct incentive to minimize administrative inefficiencies. Part of the Board’s analysis of fee levels involves reviewing certain evaluative data compiled by an independent provider comparing the Fund’s unified fee to the total expense ratios of its peers. The unified fee charged to shareholders of the Fund was above the median of the total expense ratios of the Fund’s peer expense universe. In addition, the Board reviewed the Fund’s position relative to the narrower set of its expense group peers. The Board concluded that the management fee paid by the Fund to the Advisor under the management agreement is reasonable in light of the services provided to the Fund.
29
Comparison to Fees and Services Provided to Other Clients of the Advisor. The Board also requested and received information from the Advisor concerning the nature of the services, fees, costs, and profitability of its advisory services to advisory clients other than the Fund. They observed that these varying types of client accounts require different services and involve different regulatory and entrepreneurial risks than the management of the Fund. The Board analyzed this information and concluded that the fees charged and services provided to the Fund were reasonable by comparison.
Payments to Intermediaries. The Directors also requested and received a description of payments made to intermediaries by the Fund and the Advisor and services provided in response thereto. These payments include various payments made by the Fund or the Advisor to different types of intermediaries and recordkeepers for distribution and service activities provided for the Fund. The Directors reviewed such information and received representations from the Advisor that all such payments by the Fund were made pursuant to the Fund's Rule 12b-1 Plan and that all such payments by the Advisor were made from the Advisor’s resources and reasonable profits. The Board found such payments to be reasonable in scope and purpose.
Collateral or “Fall-Out” Benefits Derived by the Advisor. The Board considered the possible existence of collateral benefits the Advisor may receive as a result of its relationship with the Fund. They concluded that the Advisor’s primary business is managing funds and it generally does not use fund or shareholder information to generate profits in other lines of business, and therefore does not derive any significant collateral benefits from them. To the extent there are potential collateral benefits, the Board has been advised and has taken this into consideration in its review of the management contract with the Fund. The Board noted that additional assets from other clients may offer the Advisor some benefit from increased leverage with service providers and counterparties. Additionally, the Advisor may receive proprietary research from broker-dealers that execute fund portfolio transactions, which the Board concluded is likely to benefit other clients of the Advisor, as well as Fund shareholders. The Board also determined that the Advisor is able to provide investment management services to certain clients other than the Fund, at least in part, due to its existing infrastructure built to serve the fund complex. The Board concluded that appropriate allocation methodologies had been employed to assign resources and the cost of those resources to these other clients.
Existing Relationship. The Board also considered whether there was any reason for not continuing the existing arrangement with the Advisor. In this regard, the Board was mindful of the potential disruptions of the Fund’s operations and various risks, uncertainties, and other effects that could occur as a result of a decision not to continue such relationship. In particular, the Board recognized that most shareholders have invested in the Fund on the strength of the Advisor’s industry standing and reputation and in the expectation that the Advisor will have a continuing role in providing advisory services to the Fund.
Conclusion of the Directors. As a result of this process, the Board, including all of the independent Directors, taking into account all of the factors discussed above and the information provided by the Advisor and others in connection with its review and throughout the year, determined that the management fee is fair and reasonable in light of the services provided and that the investment management agreement between the Fund and the Advisor should be renewed.
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Additional Information |
Retirement Account Information
As required by law, distributions you receive from certain retirement accounts are subject to federal income tax withholding, unless you elect not to have withholding apply*. Tax will be withheld on the total amount withdrawn even though you may be receiving amounts that are not subject to withholding, such as nondeductible contributions. In such case, excess amounts of withholding could occur. You may adjust your withholding election so that a greater or lesser amount will be withheld.
If you don’t want us to withhold on this amount, you must notify us to not withhold the federal income tax. You may notify us in writing or in certain situations by telephone or through other electronic means. For systematic withdrawals, your withholding election will remain in effect until revoked or changed by filing a new election. You have the right to revoke your election at any time and change your withholding percentage for future distributions.
Remember, even if you elect not to have income tax withheld, you are liable for paying income tax on the taxable portion of your withdrawal. If you elect not to have income tax withheld or you don’t have enough income tax withheld, you may be responsible for payment of estimated tax. You may incur penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. You can reduce or defer the income tax on a distribution by directly or indirectly rolling such distribution over to another IRA or eligible plan. You should consult your tax advisor for additional information.
State tax will be withheld if, at the time of your distribution, your address is within one of the mandatory withholding states and you have federal income tax withheld (or as otherwise required by state law). State taxes will be withheld from your distribution in accordance with the respective state rules.
*Some 403(b), 457 and qualified retirement plan distributions may be subject to 20% mandatory withholding, as they are subject to special tax and withholding rules. Your plan administrator or plan sponsor is required to provide you with a special tax notice explaining those rules at the time you request a distribution. If applicable, federal and/or state taxes may be withheld from your distribution amount.
Proxy Voting Policies
A description of the policies that the fund's investment advisor uses in exercising the voting rights associated with the securities purchased and/or held by the fund is available without charge, upon request, by calling 1-800-345-2021. It is also available on American Century Investments’ website at americancentury.com/proxy and on the Securities and Exchange Commission’s website at sec.gov. Information regarding how the investment advisor voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on americancentury.com/proxy. It is also available at sec.gov.
Quarterly Portfolio Disclosure
The fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. These portfolio holdings are available on the fund's website at americancentury.com and, upon request, by calling 1-800-345-2021. The fund’s Form N-PORT reports are available on the SEC’s website at sec.gov.
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Other Tax Information
The following information is provided pursuant to provisions of the Internal Revenue Code.
The funds hereby designates up to the maximum amount allowable as qualified dividend income for the fiscal year ended November 30, 2021.
The fund hereby designates $781,868, or up to the maximum amount allowable, as long-term capital gain distributions (20% rate gain distributions) for the fiscal year ended November 30, 2021.
The fund hereby designates $1,300,325 as qualified short-term capital gain distributions for purposes of Internal Revenue Code Section 871 for the fiscal year ended November 30, 2021.
For the fiscal year ended November 30, 2021, the fund intends to pass through to shareholders foreign source income of $51,964,769 and foreign taxes paid of $2,676,856, or up to the maximum amount allowable, as a foreign tax credit. Foreign source income and foreign tax expense per outstanding share on November 30, 2021 are $0.3988 and $0.0205, respectively.
The fund utilized earnings and profits of $3,837,285 distributed to shareholders on redemption of shares as part of the dividends paid deduction (tax equalization).
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Contact Us | americancentury.com | |||||||
Automated Information Line | 1-800-345-8765 | |||||||
Investor Services Representative | 1-800-345-2021 or 816-531-5575 | |||||||
Investors Using Advisors | 1-800-378-9878 | |||||||
Business, Not-For-Profit, Employer-Sponsored Retirement Plans | 1-800-345-3533 | |||||||
Banks and Trust Companies, Broker-Dealers, Financial Professionals, Insurance Companies | 1-800-345-6488 | |||||||
Telecommunications Relay Service for the Deaf | 711 | |||||||
American Century World Mutual Funds, Inc. | ||||||||
Investment Advisor: American Century Investment Management, Inc. Kansas City, Missouri | ||||||||
This report and the statements it contains are submitted for the general information of our shareholders. The report is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. | ||||||||
©2022 American Century Proprietary Holdings, Inc. All rights reserved. CL-ANN-91026 2201 |
(b) None.
ITEM 2. CODE OF ETHICS.
(a) The registrant has adopted a Code of Ethics for Senior Financial Officers that applies to the registrant’s principal executive officer, principal financial officer, principal accounting officer, and persons performing similar functions.
(b) No response required.
(c) None.
(d) None.
(e) Not applicable.
(f) The registrant’s Code of Ethics for Senior Financial Officers was filed as Exhibit 12 (a)(1) to American Century Asset Allocation Portfolios, Inc.’s Annual Certified Shareholder Report on Form N-CSR, File No. 811-21591, on September 29, 2005, and is incorporated herein by reference.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a)(1) The registrant’s board has determined that the registrant has at least one audit committee financial expert serving on its audit committee.
(a)(2) Chris H. Cheesman, Lynn M. Jenkins and Barry Fink are the registrant’s designated audit committee financial experts. They are “independent” as defined in Item 3 of Form N-CSR.
(a)(3) Not applicable.
(b) No response required.
(c) No response required.
(d) No response required.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Audit Fees.
The aggregate fees billed for each of the last two fiscal years for professional services rendered by the principal accountant for the audit of the registrant’s annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years were as follows:
FY 2020: $312,460
FY 2021: $273,800
(b) Audit-Related Fees.
The aggregate fees billed in each of the last two fiscal years for assurance and related services by the principal accountant that are reasonably related to the performance of the audit of the registrant’s financial statements and are not reported under paragraph (a) of this Item were as follows:
For services rendered to the registrant:
FY 2020: $0
FY 2021: $0
Fees required to be approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X (relating to certain engagements for non-audit services with the registrant’s investment adviser and its affiliates):
FY 2020: $0
FY 2021: $0
(c) Tax Fees.
The aggregate fees billed in each of the last two fiscal years for professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning were as follows:
For services rendered to the registrant:
FY 2020: $0
FY 2021: $0
Fees required to be approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X (relating to certain engagements for non-audit services with the registrant’s investment adviser and its affiliates):
FY 2020: $0
FY 2021: $0
(d) All Other Fees.
The aggregate fees billed in each of the last two fiscal years for products and services provided by the principal accountant, other than the services reported in paragraphs (a) through (c) of this Item were as follows:
For services rendered to the registrant:
FY 2020: $0
FY 2021: $0
Fees required to be approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X (relating to certain engagements for non-audit services with the registrant’s investment adviser and its affiliates):
FY 2020: $0
FY 2021: $0
(e)(1) In accordance with paragraph (c)(7)(i)(A) of Rule 2-01 of Regulation S-X, before the accountant is engaged by the registrant to render audit or non-audit services, the engagement is approved by the registrant’s audit committee. Pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X, the registrant’s audit committee also pre-approves its accountant’s engagements for non-audit services with the registrant’s investment adviser, its parent company, and any entity controlled by, or under common control with the investment adviser that provides ongoing services to the registrant, if the engagement relates directly to the operations and financial reporting of the registrant.
(e)(2) All services described in each of paragraphs (b) through (d) of this Item were pre-approved before the engagement by the registrant’s audit committee pursuant to paragraph (c)(7)(i)(A) of Rule 2-01 of Regulation S-X. Consequently, none of such services were required to be approved by the audit committee pursuant to paragraph (c)(7)(i)(C).
(f) The percentage of hours expended on the principal accountant’s engagement to audit the registrant’s financial statements for the most recent fiscal year that were attributed to work performed by persons other than the principal accountant’s full-time, permanent employees was less than 50%.
(g) The aggregate non-audit fees billed by the registrant’s accountant for services rendered to the registrant, and rendered to the registrant’s investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant for each of the last two fiscal years of the registrant were as follows:
FY 2020: $0
FY 2021: $2,832,126
(h) The registrant’s investment adviser and accountant have notified the registrant’s audit committee of all non-audit services that were rendered by the registrant’s accountant to the registrant’s investment adviser, its parent company, and any entity controlled by, or under common control with the investment adviser that provides services to the registrant, which services were not required to be pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X. The notification provided to the registrant’s audit committee included sufficient details regarding such services to allow the registrant’s audit committee to consider the continuing independence of its principal accountant.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. INVESTMENTS.
(a) The schedule of investments is included as part of the report to stockholders filed under Item 1 of this Form.
(b) Not applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
During the reporting period, there were no material changes to the procedures by which shareholders may recommend nominees to the registrant’s board.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive officer and principal financial officer have concluded that the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) are effective based on their evaluation of these controls and procedures as of a date within 90 days of the filing date of this report.
(b) There were no changes in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting.
ITEM 12. DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 13. EXHIBITS.
(a)(1) Registrant’s Code of Ethics for Senior Financial Officers, which is the subject of the disclosure required by Item 2 of Form N-CSR, was filed as Exhibit 12(a)(1) to American Century Asset Allocation Portfolios, Inc.’s Certified Shareholder Report on Form N-CSR, File No. 811-21591, on September 29, 2005.
(a)(2) Separate certifications by the registrant’s principal executive officer and principal financial officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and Rule 30a-2(a) under the Investment Company Act of 1940, are filed and attached hereto as EX-99.CERT.
(a)(3) Not applicable.
(a)(4) Not applicable.
(b) A certification by the registrant’s chief executive officer and chief financial officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, is furnished and attached hereto as EX-99.906CERT.
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.
Registrant: | American Century World Mutual Funds, Inc. | |||||||||||||
By: | /s/ Patrick Bannigan | |||||||||||||
Name: | Patrick Bannigan | |||||||||||||
Title: | President | |||||||||||||
Date: | January 31, 2022 |
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/ Patrick Bannigan | ||||||||||
Name: | Patrick Bannigan | ||||||||||
Title: | President | ||||||||||
(principal executive officer) | |||||||||||
Date: | January 31, 2022 |
By: | /s/ R. Wes Campbell | ||||||||||
Name: | R. Wes Campbell | ||||||||||
Title: | Treasurer and | ||||||||||
Chief Financial Officer | |||||||||||
(principal financial officer) | |||||||||||
Date: | January 31, 2022 |