Morgan Stanley Technology Fund N-CSR Certified annual shareholder report (management investment company)

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: 811-08916

Morgan Stanley Technology Fund

(Exact name of registrant as specified in charter)

522 Fifth Avenue, New York, New York 10036
(Address of principal executive offices)	(Zip code)

Randy Takian
522 Fifth Avenue, New York, New York 10036
(Name and address of agent for service)

Registrant’s telephone number, including area code: 212-296-6990

Date of fiscal year end: March 31, 2009

Date of reporting period: March 31, 2009

Item 1 — Report to Shareholders

INVESTMENT MANAGEMENT

Welcome, Shareholder:

In this report, you’ll learn about how your investment in Morgan Stanley Technology Fund performed during the annual period. We will provide an overview of the market conditions, and discuss some of the factors that affected performance during the reporting period. In addition, this report includes the Fund’s financial statements and a list of Fund investments.

This material must be preceded or accompanied by a prospectus for the fund being offered.

Market forecasts provided in this report may not necessarily come to pass. There is no assurance that the Fund will achieve its investment objective. The Fund is subject to market risk, which is the possibility that market values of securities owned by the Fund will decline and, therefore, the value of the Fund’s shares may be less than what you paid for them. Accordingly, you can lose money investing in this Fund. Please see the prospectus for more complete information on investment risks.

Fund Report

For the year ended March 31, 2009

Total Return for the 12 Months Ended March 31, 2009

						Lipper
				NYSE		Science &
				Arca	S&P	Technology
				Tech 100	500®	Funds
Class A	Class B	Class C	Class I	Index®1	Index2	Index3
–31.01%	–31.53%	–31.57%	–30.85%	–27.05%	–38.09%	–30.82%

The performance of the Fund’s four share classes varies because each has different expenses. The Fund’s total returns assume the reinvestment of all distributions but do not reflect the deduction of any applicable sales charges. Such costs would lower performance. See Performance Summary for standardized performance and benchmark information.

Market Conditions

The year under review was an extremely tumultuous period for the U.S. equity market as the failures and forced mergers of several major financial institutions beginning in the third quarter of 2008 caused a severe loss of confidence among investors and considerable declines in all sectors of the market. The economy deteriorated as the housing market continued to languish, unemployment rose, and corporate earnings weakened. Although the federal government interceded with various measures designed to stimulate the economy and the markets, there were few signs of improvement until the final weeks of the period when stocks rallied, due in part to a better financial outlook

The technology sector, as represented by the NYSE Arca Tech 100 Index^® (the “Index”), outperformed the broad market, yet still declined 27.05 percent for the 12-month period ending March 31, 2009, compared to the 38.09 percent decline for the S&P 500^® Index. All sectors within the Index lost value, with telecommunications down 43.7 percent, industrials down 32.8 percent, information technology down 28.4 percent, and health care down 17.7 percent, on an absolute basis. In terms of contribution to the Index return for the period, information technology was the largest detractor given its 70 percent weighting in the Index. Within the group, communications equipment, computer and software companies were the largest drag on performance. Health care was the second largest industry detractor, driven by health care equipment and supplies, followed by industrials, which was hindered primarily by aerospace and defense companies. Although the telecommunications group lost the most value on an absolute basis, it detracted the least from the Index return due to its comparatively smaller weighting (approximately one percent) in the Index.

Performance Analysis

All share classes of Morgan Stanley Technology Fund underperformed the NYSE Arca Tech 100 Index^® (the “Index”) and the Lipper Science & Technology Funds Index and outperformed the S&P 500^® Index for the 12 months ended March 31, 2009, assuming no deduction of applicable sales charges.

The Fund’s holdings in the internet software and services industry detracted the most from relative return for the period. Weak stock selection in the semiconductor and biotechnology industries was also detrimental to performance.

On the positive side, an underweight position coupled with good stock selection in both the aerospace and

2

defense and health care equipment industries contributed the most to the Fund’s relative performance. In addition, an underweight position in electronic equipment instruments, which was down over 45 percent for the period (as represented by the NYSE Arca Tech 100 Index), helped the Fund’s return. Lastly, strong security selection in telecommunications contributed positively, as did an underweight to the industry given its poor performance during the period.

There is no guarantee that any sectors mentioned will continue to perform as discussed herein or that securities in such sectors will be held by the Fund in the future.

TOP 10 HOLDINGS as of 03/31/09
Apple Inc.	6	.1%
International Business Machines Corp.	5	.0
Qualcomm, Inc.	4	.9
Hewlett-Packard Co.	4	.4
Synopsys, Inc.	4	.1
Cisco Systems, Inc.	3	.8
McAfee Inc.	3	.8
Lockheed Martin Corp.	3	.5
Yahoo! Inc.	3	.3
Oracle Corp.	3	.1

TOP FIVE INDUSTRIES as of 03/31/09
Packaged Software	14	.3%
Biotechnology	10	.6
Computer Processing Hardware	10	.6
Internet Software/Services	9	.7
Electronic Production Equipment	8	.6

Subject to change daily. Provided for informational purposes only and should not be deemed as a recommendation to buy or sell the securities mentioned above. Top 10 holdings and top five industries are as a percentage of net assets. Morgan Stanley is a full-service securities firm engaged in securities trading and brokerage activities, investment banking, research and analysis, financing and financial advisory services.

3

Investment Strategy

The Fund will normally invest at least 80 percent of its assets in common stocks and other equity securities of companies located throughout the world considered by the Fund’s “Investment Adviser,” Morgan Stanley Investment Advisors Inc., to rely extensively on technology, science and communications in their product development or operations at the time of investment. This policy may be changed without shareholder approval; however, you would be notified in writing of any changes. The Fund may also use derivative instruments as discussed in the fund’s prospectus. These derivative instruments will be counted toward the 80 percent policy discussed above to the extent they have economic characteristics similar to the securities included within that policy.

For More Information About Portfolio Holdings

Each Morgan Stanley fund provides a complete schedule of portfolio holdings in its semiannual and annual reports within 60 days of the end of the fund’s second and fourth fiscal quarters. The semiannual reports and the annual reports are filed electronically with the Securities and Exchange Commission (SEC) on Form N-CSRS and Form N-CSR, respectively. Morgan Stanley also delivers the semiannual and annual reports to fund shareholders and makes these reports available on its public web site, www.morganstanley.com. Each Morgan Stanley fund also files a complete schedule of portfolio holdings with the SEC for the fund’s first and third fiscal quarters on Form N-Q. Morgan Stanley does not deliver the reports for the first and third fiscal quarters to shareholders, nor are the reports posted to the Morgan Stanley public web site. You may, however, obtain the Form N-Q filings (as well as the Form N-CSR and N-CSRS filings) by accessing the SEC’s web site, http://www.sec.gov. You may also review and copy them at the SEC’s public reference room in Washington, DC. Information on the operation of the SEC’s public reference room may be obtained by calling the SEC at (800) SEC-0330. You can also request copies of these materials, upon payment of a duplicating fee, by electronic request at the SEC’s e-mail address (publicinfo@sec.gov) or by writing the public reference section of the SEC, Washington, DC 20549-0102.

Proxy Voting Policy and Procedures and Proxy Voting Record

You may obtain a copy of the Fund’s Proxy Voting Policy and Procedures without charge, upon request, by calling toll free (800) 869-NEWS or by visiting the Mutual Fund Center on our Web site at www.morganstanley.com. It is also available on the Securities and Exchange Commission’s Web site at http://www.sec.gov.

You may obtain information regarding how the Fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 without charge by visiting the Mutual Fund Center on our Web site at www.morganstanley.com. This information is also available on the Securities and Exchange Commission’s Web site at http://www.sec.gov.

Householding Notice

To reduce printing and mailing costs, the Fund attempts to eliminate duplicate mailings to the same address. The Fund delivers a single copy of certain shareholder documents, including shareholder reports, prospectuses and proxy materials, to investors with the same last name who reside at the same address. Your participation in this program will continue for an unlimited period of time unless you instruct us otherwise. You can request multiple copies of these documents by calling (800) 869-NEWS, 8:00 a.m. to 8:00 p.m., ET. Once our Customer Service Center has received your instructions, we will begin sending individual copies for each account within 30 days.

4

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5

Performance Summary

Performance of $10,000 Investment — Class B

Over 10 Years

6

Average Annual Total Returns — Period Ended March 31, 2009

	Class A Shares	*	Class B Shares	**	Class C Shares	†	Class I Shares	††
	(since 07/28/97	)	(since 11/28/95	)	(since 07/28/97	)	(since 07/28/97	)
Symbol	IFOAX		IFOBX		IFOCX		IFODX
1 Year	(31.01	)%4	(31.53	)%4	(31.57	)%4	(30.85	)%4
	(34.63	) 5	(34.96	) 5	(32.25	) 5	—
5 Years	(6.83	) 4	(7.55	) 4	(7.56	) 4	(6.61	) 4
	(7.83	) 5	(7.92	) 5	(7.56	) 5	—
10 Years	(6.47	) 4	(7.05	) 4	(7.19	) 4	(6.27	) 4
	(6.98	) 5	(7.05	) 5	(7.19	) 5	—
Since Inception	(0.27	) 4	0.34	4	(1.03	) 4	(0.04	) 4
	(0.73	) 5	0.34	5	(1.03	) 5	—

Performance data quoted represents past performance, which is no guarantee of future results and current performance may be lower or higher than the figures shown. For the most recent month-end performance figures, please visit www.morganstanley.com/im or speak with your Financial Advisor. Investment returns and principal value will fluctuate and fund shares, when redeemed, may be worth more or less than their original cost. The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Performance for Class A, Class B, Class C, and Class I shares will vary due to differences in sales charges and expenses. See the Fund’s current prospectus for complete details on fees and sales charges.

*	The maximum front-end sales charge for Class A is 5.25%.
**	The maximum contingent deferred sales charge (CDSC) for Class B is 5.0%. The CDSC declines to 0% after six years. Effective April 2005, Class B shares will generally convert to Class A shares approximately eight years after the end of the calendar month in which the shares were purchased. Performance for periods greater than eight years reflects this conversion (beginning April 2005).
†	The maximum contingent deferred sales charge for Class C is 1.0% for shares redeemed within one year of purchase.
††	Class I has no sales charge.
(1)	The NYSE Arca Tech 100 Index® is a price-weighted index comprised of common stocks and ADRs of technology-related companies listed on U.S. exchanges. The Index is unmanaged and its returns do not include any sales charges or fees. Such costs would lower performance. It is not possible to invest directly in an index.
(2)	The Standard & Poor’s 500® Index (S&P 500®) measures the performance of the large cap segment of the U.S. equities market, covering approximately 75% of the U.S. equities market. The Index includes 500 leading companies in leading industries of the U.S. economy. The Index is unmanaged and its returns do not include any sales charges or fees. Such costs would lower performance. It is not possible to invest directly in an index.
(3)	The Lipper Science & Technology Funds Index is an equally weighted performance index of the largest qualifying funds (based on net assets) in the Lipper Science & Technology Funds classification. The Index, which is adjusted for capital gains distributions and income dividends, is unmanaged and should not be considered an investment. There are currently 30 funds represented in this Index. The Fund was in the Lipper Science & Technology Funds classification as of the date of this report.
(4)	Figure shown assumes reinvestment of all distributions and does not reflect the deduction of any sales charges.
(5)	Figure shown assumes reinvestment of all distributions and the deduction of the maximum applicable sales charge. See the Fund’s current prospectus for complete details on fees and sales charges.
‡	Ending value assuming a complete redemption on March 31, 2009.

7

Expense Example

As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption fees; and (2) ongoing costs, including advisory 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 the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period 10/01/08 – 03/31/09.

Actual Expenses

The first line of the table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. 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 in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The second line of the table below provides information about hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. 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 cost of investing in the 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) and redemption fees. Therefore, the second line of the table is useful in comparing ongoing costs, and will not help you determine the relative total cost of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

	Beginning		Ending		Expenses Paid
	Account Value		Account Value		During Period@
					10/01/08 –
	10/01/08		03/31/09		03/31/09
Class A
Actual (–19.27% return)	$	1,000.00	$	807.30	$	10.27
Hypothetical (5% annual return before expenses)	$	1,000.00	$	1,013.56	$	11.45
Class B
Actual (–19.63% return)	$	1,000.00	$	803.70	$	13.63
Hypothetical (5% annual return before expenses)	$	1,000.00	$	1,009.82	$	15.18
Class C
Actual (–19.65% return)	$	1,000.00	$	803.50	$	13.62
Hypothetical (5% annual return before expenses)	$	1,000.00	$	1,009.82	$	15.18
Class I
Actual (–19.18% return)	$	1,000.00	$	808.20	$	9.15
Hypothetical (5% annual return before expenses)	$	1,000.00	$	1,014.81	$	10.20

@ Expenses are equal to the Fund’s annualized expense ratios of 2.28%, 3.03%, 3.03% and 2.03% for Class A, Class B, Class C and Class I shares, respectively, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).

8

Morgan Stanley Technology Fund

Portfolio of Investments - March 31, 2009

NUMBER OF
SHARES			VALUE
		Common Stocks (99.9%)
		Aerospace & Defense (3.7%)
	2,400	Goodrich Corp.	$	90,936
	54,900	Lockheed Martin Corp.		3,789,747
	2,400	Raytheon Co.		93,456
				3,974,139
		Biotechnology (10.6%)
	47,400	Amgen Inc. (a)		2,347,248
	2,400	Biogen Idec Inc. (a)		125,808
	20,000	Celgene Corp. (a)		888,000
	54,900	Genzyme Corp. (a)		3,260,511
	50,000	Gilead Sciences, Inc. (a)		2,316,000
	2,400	Millipore Corp. (a)		137,784
	50,000	Myriad Genetics, Inc. (b) (a)		2,273,500
	2,400	ViroPharma Inc. (a)		12,600
				11,361,451
		Chemicals: Agricultural (2.3%)
	30,000	Monsanto Co.		2,493,000
		Computer Communications (7.2%)
	245,200	Cisco Systems, Inc. (a)		4,112,004
	2,400	Emulex Corp. (a)		12,072
	57,400	F5 Networks, Inc. (b) (a)		1,202,530
	157,400	Juniper Networks, Inc. (b) (a)		2,370,444
	2,400	QLogic Corp. (a)		26,688
				7,723,738
		Computer Peripherals (3.1%)
	117,400	EMC Corp. (a)		1,338,360
	132,400	NetApp Inc. (a)		1,964,816
	2,400	Seagate Technology (Cayman Islands) (a)		14,424
	192,300	Seagate Technology Inc. (c) (a)		0
	2,400	Western Digital Corp. (a)		46,416
				3,364,016
		Computer Processing Hardware (10.6%)
	62,400	Apple Inc. (a)		6,559,488
	2,400	Dell Inc. (a)		22,752
	147,400	Hewlett-Packard Co.		4,725,644
	2,400	Sun Microsytems (a)		17,568
				11,325,452
		Data Processing Services (0.2%)
	2,400	Automatic Data Processing, Inc.		84,384
	2,400	DST Systems, Inc. (a)		83,088
				167,472
		Electrical Products (0.0%)
	4	SunPower Corp. (a)		79
		Electronic Components (0.0%)
	2,400	Jabil Circuit, Inc.		13,344
		Electronic Equipment/Instruments (0.1%)
	2,400	Agilent Technologies, Inc. (a)		36,888
	2,400	JDS Uniphase Corp. (a)		7,800
	2,400	Xerox Corp. (a)		10,920
				55,608
		Electronic Production Equipment (8.6%)
	87,400	Applied Materials, Inc.		939,550
	60,000	ASML Holdings N.V (Netherlands) (b)		1,050,600
	2,700	Cadence Design Systems, Inc. (a)		11,340
	57,400	KLA-Tencor Corp. (b)		1,148,000
	72,400	Lam Research Corp. (b) (a)		1,648,548
	2,400	Mentor Graphics Corp. (a)		10,656
	2,400	Novellus Systems, Inc. (a)		39,912
	210,600	Synopsys, Inc. (a)		4,365,738
	2,400	Teradyne, Inc. (a)		10,512
				9,224,856

See Notes to Financial Statements

9

Morgan Stanley Technology Fund

Portfolio of Investments - March 31, 2009 continued

NUMBER OF
SHARES			VALUE
		Information Technology Services (8.4%)
	112,400	Amdocs Ltd. (Guernsey) (a)	$	2,081,648
	67,400	Citrix Systems, Inc. (a)		1,525,936
	2,400	Computer Sciences Corp. (a)		88,416
	54,900	International Business Machines Corp.		5,319,261
	2,400	Terdata Corp. (a)		38,928
				9,054,189
		Internet Retail (2.7%)
	40,000	Amazon.com, Inc. (a)		2,937,600
		Internet Software/Services (9.7%)
	112,400	Check Point Software Technologies Ltd. (Israel) (b) (a)		2,496,404
	2,400	Digital River, Inc. (a)		71,568
	9,040	Google Inc. (Class A) (a)		3,146,462
	2,400	J2 Global Communications, Inc. (a)		52,536
	2,400	Progress Software Corp. (a)		41,664
	52,400	VeriSign, Inc. (b) (a)		988,788
	2,400	Websense, Inc. (a)		28,800
	278,400	Yahoo! Inc. (a)		3,566,304
				10,392,526
		Medical Specialties (0.3%)
	2,400	Boston Scientific Corp. (a)		19,080
	2,400	CONMED Corp. (a)		34,584
	1,900	Kinetic Concepts, Inc. (a)		40,128
	2,400	Medtronic, Inc.		70,728
	2,400	St. Jude Medical, Inc. (a)		87,192
	2,400	Thermo Fisher Scientific, Inc. (a)		85,608
				337,320
		Other Consumer Services (0.0%)
	2,400	eBay Inc. (a)		30,144
		Packaged Software (14.3%)
	62,400	Adobe Systems, Inc. (a)		1,334,736
	52,400	Autodesk, Inc. (a)		880,844
	72,400	BMC Software, Inc. (a)		2,389,200
	2,400	CA Inc.		42,264
	2,400	Compuware Corp. (a)		15,816
	122,400	McAfee Inc. (a)		4,100,400
	102,400	Microsoft Corp.		1,881,088
	2,400	Novell, Inc. (a)		10,224
	182,400	Oracle Corp. (a)		3,295,968
	2,400	SAP AG (ADR) (Germany)		84,696
	2,400	Sybase, Inc. (a)		72,696
	82,400	Symantec Corp. (a)		1,231,056
				15,338,988
		Pharmaceuticals: Major (0.1%)
	2,400	Novartis AG (ADR) (Switzerland)		90,792
		Pharmaceuticals: Other (0.0%)
	2,400	Biovail Corp. (Canada) (a)		26,280
		Recreational Products (3.0%)
	310,450	Activision Blizzard, Inc. (a)		3,247,307
		Semiconductors (7.9%)
	67,400	Altera Corp.		1,182,870
	52,400	Analog Devices, Inc.		1,009,748
	72,400	Broadcom Corp. (Class A) (b) (a)		1,446,552
	102,400	Intel Corp.		1,541,120
	2,400	Linear Technology Corp.		55,152
	62,400	National Semiconductor Corp. (b)		640,848
	2,400	Standard Microsystems Corp. (a)		44,640
	67,400	Texas Instruments Inc.		1,112,774
	72,400	Xilinx, Inc. (b)		1,387,184
				8,420,888
		Telecommunication Equipment (7.1%)
	2,400	Arris Group, Inc. (a)		17,688
	2,400	Ciena Corp. (a)		18,672
	2,400	Corning Inc.		31,848
	2,400	Harmonic, Inc. (a)		15,600
	2,400	Harris Corp.		69,456
	2,400	InterDigital, Inc. (a)		61,968
	2,400	Motorola, Inc.		10,152
	2,400	Nokia Corp. (ADR) (Finland)		28,008
	17,009	Nortel Networks (Canada) (b)		3,710
	2,400	Polycom, Inc. (a)		36,936

See Notes to Financial Statements

10

Morgan Stanley Technology Fund

Portfolio of Investments - March 31, 2009 continued

NUMBER OF
SHARES			VALUE
	133,950	Qualcomm, Inc.	$	5,211,995
	50,000	Research In Motion Ltd. (Canada) (b) (a)		2,153,500
	2,400	Tellabs, Inc. (a)		10,992
				7,670,525
		Wireless Telecommunications (0.0%)
	2,400	Telephone & Data Systems, Inc.		63,624
		Total Common Stocks (Cost $141,315,855)		107,313,338
PRINCIPAL
AMOUNT IN
THOUSANDS
		Short-Term Investments (17.3%)
		Securities held as Collateral on Loaned Securities (12.4%)
		Repurchase Agreements (2.5%)
	$1,348	Banc of Amercia Securities LLC (0.4125%, dated 03/31/09, due 04/01/09; proceeds $1,348,186); fully collateralized by commercial paper at the date of this Portfolio of Investments as follows:
		Breeds Hill Capital LTD, NY 1.10% due 04/09/09; valued at $1,375,980)		1,348,170
	$532	Barclays Capital LLC (0.71% dated 03/31/09, due 04/01/09; proceeds $532,184) fully collateralized by common stocks at the date of this Portfolio of Investments as follows: Expedia Inc. AnnTaylor Stores Corp., Plains Exploration & Production Co.; valued at $559,136		532,173
	532	Citigroup (0.7125% dated 03/31/09, due 04/01/09; proceeds $532,184) fully collateralized by Convertible Senior Debentures at the date of this Portfolio of Investments as follows: General Motors Corp. (Series C) 6.25%, due 01/01/49; valued at $559,127		532,173
	240	Banc of Amercia Securities LLC (0.25%, dated 03/31/09, due 04/01/09; proceeds $240,153); fully collateralized by Government Agency Obligations at the date of this Portfolio of Investments as follows: Federal National Mortgage Assoc. 5.50% due 06/01/38; valued at $245,106		240,152
		Total Repurchase Agreements (Cost $2,652,668)		2,652,668

See Notes to Financial Statements

11

Morgan Stanley Technology Fund

Portfolio of Investments - March 31, 2009 continued

NUMBER OF
SHARES (000)						VALUE
		Investment Company (d) (9.9%)
	10,679	Morgan Stanley Institutional Liquidity Funds – Money Market Portfolio – Institutional Class (Cost $10,679,498 )				$	10,679,498
		Total Securities held as Collateral on Loaned Securities (Cost $13,332,166)					13,332,166
		Investment Company (d) (4.9%)
	5,211	Morgan Stanley Institutional Liquidity Funds – Money Market Portfolio – Institutional Class (Cost $5,210,554)					5,210,554
		Total Short-Term Investments (Cost $18,542,720)					18,542,720
Total Investments (Cost $159,858,575) (e)			117.2		%		125,856,058
Liabilities in Excess of Other Assets			(17.2	)			(18,450,362	)
Net Assets			100.0		%	$	107,405,696

ADR	American Depositary Receipt
(a)	Non-income producing security.
(b)	All or a portion of this security was on loan as of March 31, 2009.
(c)	A security with total market value equal to $0 has been valued at its fair value as determined in good faith under procedures established by and under the general supervision of the Fund’s Trustees. Such fair value measurements may be level 2 measurements if observable inputs are available. See Note 10.
(d)	See Note 4 to the financial statements regarding investments in Morgan Stanley Institutional Liquidity Funds – Money Market Portfolio – Institutional Class.
(e)	The aggregate cost for federal income tax purposes is $162,677,576. The aggregate gross unrealized appreciation is $4,672,807 and the aggregate gross unrealized depreciation is $41,494,325, resulting in net unrealized depreciation of $36,821,518.

Summary of Investments by Industry Classification - March 31, 2009

				PERCENT OF
				TOTAL
INDUSTRY	VALUE			INVESTMENTS
Packaged Software	$	15,338,988			13.6	%
Biotechnology		11,361,451			10.1
Computer Processing Hardware		11,325,452			10.1
Internet Software/Services		10,392,526			9.4
Electronic Production Equipment		9,224,856			8.2
Information Technology Services		9,054,189			8.0
Semiconductors		8,420,888			7.5
Computer Communications		7,723,738			6.9
Telecommunication Equipment		7,670,525			6.8
Investment Company		5,210,554			4.6
Aerospace & Defense		3,974,139			3.5
Computer Peripherals		3,364,016			3.0
Recreational Products		3,247,307			2.9
Internet Retail		2,937,600			2.6
Chemicals: Agricultural		2,493,000			2.2
Medical Specialties		337,320			0.3
Data Processing Services		167,472			0.1
Pharmaceuticals: Major		90,792			0.1
Wireless Telecommunications		63,624			0.1
Electronic Equipment/Instruments		55,608			0.0
Other Consumer Services		30,144			0.0
Pharmaceuticals: Other		26,280			0.0
Electronic Components		13,344			0.0
Electrical Products		79			0.0
	$	112,523,892	+		100.0	%

+ Does not reflect the value of securities held as collateral on loaned securities.

See Notes to Financial Statements

12

Morgan Stanley Technology Fund

Financial Statements

Statement of Assets and Liabilities

March 31, 2009

Assets:
Investments in securities, at value (cost $143,968,523) (including $12,938,935, for securities loaned)	$	109,966,006
Investment in affiliate, at value (cost $15,890,052)		15,890,052
Receivable for:
Dividends		30,192
Shares of beneficial interest sold		2,651
Dividends from affiliate		260
Prepaid expenses and other assets		19,229
Total Assets		125,908,390
Liabilities:
Collateral on securities loaned at value		13,332,166
Payable for:
Investments purchased		4,838,768
Transfer agent fee		67,754
Investment advisory fee		59,966
Shares of beneficial interest redeemed		58,863
Distribution fee		40,687
Administration fee		7,176
Accrued expenses and other payables		97,314
Total Liabilities		18,502,694
Net Assets	$	107,405,696
Composition of Net Assets:
Paid-in-capital	$	2,149,978,176
Net unrealized depreciation		(34,002,517	)
Accumulated net investment loss		(10,909	)
Accumulated net realized loss		(2,008,559,054	)
Net Assets	$	107,405,696
Class A Shares:
Net Assets		$78,704,943
Shares Outstanding (unlimited authorized, $.01 par value)		11,055,051
Net Asset Value Per Share		$7.12
Maximum Offering Price Per Share, (net asset value plus 5.54% of net asset value)		$7.51
Class B Shares:
Net Assets		$19,555,983
Shares Outstanding (unlimited authorized, $.01 par value)		3,024,145
Net Asset Value Per Share		$6.47
Class C Shares:
Net Assets		$8,926,732
Shares Outstanding (unlimited authorized, $.01 par value)		1,380,906
Net Asset Value Per Share		$6.46
Class I Shares:
Net Assets		$218,038
Shares Outstanding (unlimited authorized, $.01 par value)		29,764
Net Asset Value Per Share		$7.33

See Notes to Financial Statements

13

Morgan Stanley Technology Fund

Financial Statements continued

Statement of Operations

For the year ended March 31, 2009

Net Investment Loss:
Income
Dividends (net of $21,034 foreign withholding tax)	$	873,754
Income from securities loaned – net		131,960
Dividends from affiliate		15,350
Total Income		1,021,064
Expenses
Transfer agent fees and expenses		1,114,620
Investment advisory fee		998,452
Distribution fee (Class A shares)		214,761
Distribution fee (Class B shares)		500,230
Distribution fee (Class C shares)		123,035
Shareholder reports and notices		196,687
Administration fee		119,218
Professional fees		101,724
Registration fees		46,524
Custodian fees		5,959
Trustees’ fees and expenses		3,306
Other		21,276
Total Expenses		3,445,792
Less: rebate from Morgan Stanley affiliated cash sweep (Note 4)		(808	)
Net Expenses		3,444,984
Net Investment Loss		(2,423,920	)
Realized and Unrealized Gain (Loss):
Realized Gain (Loss) on:
Investments		(15,533,015	)
Option contracts		547,103
Foreign exchange transactions		(11,383	)
Net Realized Loss		(14,997,295	)
Net Change in Unrealized Appreciation/Depreciation		(36,892,453	)
Net Loss		(51,889,748	)
Net Decrease	$	(54,313,668	)

See Notes to Financial Statements

14

Morgan Stanley Technology Fund

Financial Statements continued

Statements of Changes in Net Assets

	FOR THE YEAR			FOR THE YEAR
	ENDED			ENDED
	MARCH 31, 2009			MARCH 31, 2008
Increase (Decrease) in Net Assets:
Operations:
Net investment loss	$	(2,423,920	)	$	(3,896,769	)
Net realized gain (loss)		(14,997,295	)		9,962,218
Net change in unrealized appreciation/depreciation		(36,892,453	)		(3,902,933	)
Net Increase (Decrease)		(54,313,668	)		2,162,516
Net decrease from transactions in shares of beneficial interest		(30,946,710	)		(62,024,564	)
Net Decrease		(85,260,378	)		(59,862,048	)
Net Assets:
Beginning of period		192,666,074			252,528,122
End of Period (Including accumulated net investment losses of $10,909 and $2,431, respectively)	$	107,405,696		$	192,666,074

See Notes to Financial Statements

15

Morgan Stanley Technology Fund

Notes to Financial Statements - March 31, 2009

1. Organization and Accounting Policies

Morgan Stanley Technology Fund (the “Fund”) is registered under the Investment Company Act of 1940, as amended (the “Act”), as a diversified, open-end management investment company. The Fund’s investment objective is long-term capital appreciation. The Fund was organized as a Massachusetts business trust on December 8, 1994 and commenced operations on November 28, 1995. On July 28, 1997, the Fund converted to a multiple class share structure.

The Fund offers Class A shares, Class B shares, Class C shares and Class I shares. The four classes are substantially the same except that most Class A shares are subject to a sales charge imposed at the time of purchase and some Class A shares, and most Class B shares and Class C shares are subject to a contingent deferred sales charge imposed on shares redeemed within eighteen months, six years and one year, respectively. Class I shares are not subject to a sales charge. Additionally, Class A shares, Class B shares and Class C shares incur distribution expenses.

For the period April 1, 2008 to January 20, 2009, the Fund assessed a 2% redemption fee, on Class A shares, Class B shares, Class C shares, and Class I shares, which was paid directly to the Fund, for shares redeemed or exchanged within thirty days of purchase, subject to certain exceptions. The redemption fee was designed to protect the Fund and its remaining shareholders from the effects of short-term trading. The Board of Trustees has approved the elimination of redemption fees, effective January 21, 2009.

The following is a summary of significant accounting policies:

A. Valuation of Investments — (1) an equity portfolio security listed or traded on the New York Stock Exchange (“NYSE”) or American Stock Exchange or other exchange is valued at its latest sale price prior to the time when assets are valued; if there were no sales that day, the security is valued at the mean between the last reported bid and asked price; (2) an equity portfolio security listed or traded on the Nasdaq is valued at the Nasdaq Official Closing Price; if there were no sales that day, the security is valued at the mean between the last reported bid and asked price; (3) all other portfolio securities for which over-the-counter market quotations are readily available are valued at the mean between the last reported bid and asked price. In cases where a security is traded on more than one exchange, the security is valued on the exchange designated as the primary market; (4) for equity securities traded on foreign exchanges, the last reported sale price or the latest bid price may be used if there were no sales on a particular day; (5) when market quotations are not readily available including circumstances under which Morgan Stanley Investment Advisors Inc. (the “Investment Adviser”) or (effective November 21, 2008) Morgan Stanley Investment Management Limited (the “Sub-Adviser”), an affiliate of the Investment Adviser, determines that the latest sale price, the bid price or the mean between the last reported bid and asked price do not reflect a security’s market value, portfolio securities are valued at their fair value as determined in good faith under procedures

16

Morgan Stanley Technology Fund

Notes to Financial Statements - March 31, 2009 continued

established by and under the general supervision of the Fund’s Trustees. Occasionally, developments affecting the closing prices of securities and other assets may occur between the times at which valuations of such securities are determined (that is, close of the foreign market on which the securities trade) and the close of business on the NYSE. If developments occur during such periods that are expected to materially affect the value of such securities, such valuations may be adjusted to reflect the estimated fair value of such securities as of the close of the NYSE, as determined in good faith by the Fund’s Trustees or by the Investment Adviser using a pricing service and/or procedures approved by the Trustees of the Fund; (6) certain portfolio securities may be valued by an outside pricing service approved by the Fund’s Trustees; (7) investments in open-end mutual funds including the Morgan Stanley Institutional Liquidity Funds, are valued at the net asset value as of the close of each business day; and (8) short-term debt securities having a maturity date of more than sixty days at time of purchase are valued on a mark-to-market basis until sixty days prior to maturity and thereafter at amortized cost based on their value on the 61st day. Short-term debt securities having a maturity date of sixty days or less at the time of purchase are valued at amortized cost, which approximates market value.

B. Accounting for Investments — Security transactions are accounted for on the trade date (date the order to buy or sell is executed). Realized gains and losses on security transactions are determined by the identified cost method. Dividend income and other distributions are recorded on the ex-dividend date. Discounts are accreted and premiums are amortized over the life of the respective securities and are included in interest income. Interest income is accrued daily.

C. Multiple Class Allocations — Investment income, expenses (other than distribution fees), and realized and unrealized gains and losses are allocated to each class of shares based upon the relative net asset value on the date such items are recognized. Distribution fees are charged directly to the respective class.

D. Foreign Currency Translation and Forward Foreign Currency Contracts — The books and records of the Fund are maintained in U.S. dollars as follows: (1) the foreign currency market value of investment securities, other assets and liabilities and forward foreign currency contracts (“forward contracts”) are translated at the exchange rates prevailing at the end of the period; and (2) purchases, sales, income and expenses are translated at the exchange rates prevailing on the respective dates of such transactions. The resultant exchange gains and losses are recorded as realized and unrealized gains/losses on foreign exchange transactions. Pursuant to U.S. federal income tax regulations, certain foreign exchange gains/losses included in realized and unrealized gains/losses are included in or are a reduction of ordinary income for federal income tax purposes. The Fund does not isolate that portion of the results of operations arising as a result of changes in the foreign exchange rates from the changes in the market prices of the securities. Forward contracts are valued daily at the appropriate exchange rates. The resultant unrealized exchange gains and losses are recorded as unrealized foreign currency gains or losses. The Fund records realized

17

Morgan Stanley Technology Fund

Notes to Financial Statements - March 31, 2009 continued

gains or losses on delivery of the currency or at the time the forward contract is extinguished (compensated) by entering into a closing transaction prior to delivery.

E. Options — When the Fund writes a call or put option, an amount equal to the premium received is included in the Fund’s Statement of Assets and Liabilities as a liability which is subsequently marked-to-market to reflect the current market value of the option written. If a written option either expires or the Fund enters into a closing purchase transaction, the Fund realizes a gain or loss without regard to any unrealized gain or loss on the underlying security and the liability related to such option is extinguished. If a written call option is exercised, the Fund realizes a gain or loss from the sale of the underlying security and the proceeds from such sale are increased by the premium originally received. If a written put option is exercised, the amount of the premium originally received reduces the cost of the security which the Fund purchases upon exercise of the option. By writing a covered call option, the Fund, in exchange for the premium, forgoes the opportunity for capital appreciation above the exercise price, should the market price of the underlying security increase. By writing a put option, the Fund, in exchange for the premium, accepts the risk of having to purchase a security at an exercise price that is above the current price.

When the Fund purchases a call or put option, the premium paid is recorded as an investment which is subsequently marked-to-market to reflect the current market value. If a purchased option expires, the Fund will realize a loss to the extent of the premium paid. If the Fund enters into a closing sale transaction, a gain or loss is realized for the difference between the proceeds from the sale and the cost of the option. If a put option is exercised, the cost of the security or currency sold upon exercise will be increased by the premium originally paid. If a call option is exercised, the cost of the security purchased upon exercise will be increased by the premium originally paid. The maximum exposure to loss for any purchased option is limited to the premium initially paid for the option.

Transactions in written options for the year ended March 31, 2009 were as follows:

	NUMBER OF
	CONTRACTS	PREMIUMS
Options written, outstanding at beginning of the period	—	—
Options written	15,758	$1,892,170
Options closed	(15,758)	(1,892,170)
Option written, outstanding at end of period	0	$0

F. Securities Lending — The Fund may lend securities to qualified financial institutions, such as broker-dealers, to earn additional income. Any increase or decrease in the fair value of the securities loaned that might occur and any interest earned or dividends declared on those securities during the term of the loan would remain in the Fund. The Fund receives cash or securities as collateral in an amount equal to or

18

Morgan Stanley Technology Fund

Notes to Financial Statements - March 31, 2009 continued

exceeding 100% of the current fair value of the loaned securities. The collateral is marked-to-market daily, by the securities lending agent, to ensure that a minimum of 100% collateral coverage is maintained.

Based on pre-established guidelines, the securities lending agent invests any cash collateral that is received in high-quality short-term investments. Securities lending income is generated from the earnings on the invested collateral and borrowing fees, less any rebates owed to the borrowers and compensation to the lending agent.

The value of loaned securities and related collateral outstanding at March 31, 2009 were $12,938,935 and $13,332,166, respectively. The Fund received cash collateral which was subsequently invested in Repurchase Agreements and Morgan Stanley Institutional Liquidity Funds as reported in the Portfolio of Investments. The Fund has the right under the lending agreement to recover the securities from the borrower on demand.

G. Federal Income Tax Policy — It is the Fund’s policy to comply with the requirements of Subchapter M of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Therefore, no federal income tax provision is required. The Fund files tax returns with the U.S. Internal Revenue Service, New York State and New York City. The Fund follows the provisions of the Financial Accounting Standards Board (“FASB”) Interpretation No. 48 (“FIN 48”) Accounting for Uncertainty in Income Taxes. FIN 48 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. There are no unrecognized tax benefits in the accompanying financial statements. If applicable, the Fund recognizes interest accrued related to unrecognized tax benefits in interest expense and penalties in other expenses in the Statement of Operations. Each of the tax years in the four year period ended March 31, 2009, remains subject to examination by taxing authorities.

H. Dividends and Distributions to Shareholders — Dividends and distributions to shareholders are recorded on the ex-dividend date.

I. Use of Estimates — The preparation of financial statements in accordance with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the reported amounts and disclosures. Actual results could differ from those estimates.

2. Investment Advisory, Sub Advisory and Administration Agreements

Pursuant to an Investment Advisory Agreement with the Investment Adviser, the Fund pays an advisory fee, accrued daily and payable monthly, by applying the following annual rates to the net assets of the Fund determined at the close of each business day: 0.67% to the portion of the daily net assets not exceeding $500 million; 0.645 to the portion of the daily net assets exceeding $500 million but not exceeding $3 billion and 0.62% to the portion of the daily net assets in excess of $3 billion.

19

Morgan Stanley Technology Fund

Notes to Financial Statements - March 31, 2009 continued

Effective November 21, 2008, under a Sub-Advisory agreement between the Sub-Adviser and the Investment Adviser, the Sub-Adviser provides the Fund with investment advice and portfolio management relating to the Portfolios’ investments in securities, subject to the overall supervision of the Investment Adviser. As compensation for its services provided pursuant to the Sub-Advisory Agreement, the Investment Adviser paid the Sub-Adviser compensation in the amount of $31,439 for the period ended March 31, 2009.

Pursuant to an Administration Agreement with Morgan Stanley Services Company Inc. (the “Administrator”), an affiliate of the Investment Adviser, and Sub-Adviser, the Fund pays an administration fee, accrued daily and payable monthly, by applying the annual rate of 0.08% to the Fund’s daily net assets.

Under an agreement between the Administrator and State Street Bank and Trust Company (“State Street”), State Street provides certain administrative services to the Fund. For such services, the Administrator pays State Street a portion of the fee the Administrator receives from the Fund.

3. Plan of Distribution

Shares of the Fund are distributed by Morgan Stanley Distributors Inc. (the “Distributor”), an affiliate of the Investment Adviser, Sub-Adviser and Administrator. The Fund has adopted a Plan of Distribution (the “Plan”) pursuant to Rule 12b-1 under the Act. The Plan provides that the Fund will pay the Distributor a fee which is accrued daily and paid monthly at the following annual rates: (i) Class A – up to 0.25% of the average daily net assets of Class A shares; (ii) Class B – up to 1.0% of the average daily net assets of Class B shares; and (iii) Class C – up to 1.0% of the average daily net assets of Class C shares.

In the case of Class B shares, provided that the Plan continues in effect, any cumulative expenses incurred by the Distributor but not yet recovered may be recovered through the payment of future distribution fees from the Fund pursuant to the Plan and contingent deferred sales charges paid by investors upon redemption of Class B shares. Although there is no legal obligation for the Fund to pay expenses incurred in excess of payments made to the Distributor under the Plan and the proceeds of contingent deferred sales charges paid by investors upon redemption of shares, if for any reason the Plan is terminated, the Trustees will consider at that time the manner in which to treat such expenses. The Distributor has advised the Fund that such excess amounts totaled $108,180,604 at March 31, 2009.

In the case of Class A shares and Class C shares, expenses incurred pursuant to the Plan in any calendar year in excess of 0.25% or 1.0% of the average daily net assets of Class A or Class C, respectively, will not be reimbursed by the Fund through payments in any subsequent year, except that expenses representing a gross sales credit to Morgan Stanley Financial Advisors and other authorized financial representatives at the time of sale may be reimbursed in the subsequent calendar year. For the year ended March 31, 2009, the distribution fee was accrued for Class A shares and Class C shares at the annual rate of 0.25% and 1.0%, respectively.

20

Morgan Stanley Technology Fund

Notes to Financial Statements - March 31, 2009 continued

The Distributor has informed the Fund that for the year ended March 31, 2009, it received contingent deferred sales charges from certain redemptions of the Fund’s Class A shares, Class B shares and Class C shares of $372, $55,397 and $592, respectively and received $12,412 in front-end sales charges from sales of the Fund’s Class A shares. The respective shareholders pay such charges which are not an expense of the Fund.

4. Security Transactions and Transactions with Affiliates

The Fund invests in Morgan Stanley Institutional Liquidity Funds – Money Market Portfolio – Institutional Class, an open-end management investment company managed by an affiliate of the Investment Adviser, both directly, and as a portion of the securities held as collateral on loaned securities. Investment Advisory fees paid by the Fund are reduced by an amount equal to the advisory and administrative service fees paid by Morgan Stanley Institutional Liquidity Funds – Money Market Portfolio – Institutional Class with respect to assets invested by the Fund in Morgan Stanley Institutional Liquidity Funds – Money Market Portfolio – Institutional Class. For the year ended March 31, 2009, advisory fees paid were reduced by $808 relating to the Fund’s investment in Morgan Stanley Institutional Liquidity Funds – Money Market Portfolio – Institutional Class. Income distributions earned by the Fund are recorded as “dividends from affiliate” in the Statement of Operations and totaled $15,350 for the year ended March 31, 2009. During the year ended March 31, 2009, cost of purchases and sales in investments in Morgan Stanley Institutional Liquidity Funds – Money Market Portfolio – Institutional Class aggregated $37,200,162 and $32,494,175, respectively.

The cost of purchases and proceeds from sales of portfolio securities, excluding short-term investments, for the year ended March 31, 2009 aggregated $121,029,056 and $151,735,221, respectively. Included in the aforementioned transactions are sales of $1,706,600 with other Morgan Stanley funds, including realized losses of $255,186.

For the year ended March 31, 2009, the Fund incurred brokerage commissions of $56,720 with Morgan Stanley & Co., Inc., an affiliate of the Investment Adviser, Sub-Adviser, Administrator and Distributor, for portfolio transactions executed on behalf of the Fund.

Morgan Stanley Trust, an affiliate of the Investment Adviser, Sub-Adviser, Administrator and Distributor, is the Fund’s transfer agent.

The Fund has an unfunded Deferred Compensation Plan (the “Compensation Plan”) which allows each independent Trustee to defer payment of all, or a portion, of the fees he or she receives for serving on the Board of Trustees. Each eligible Trustee generally may elect to have the deferred amounts credited with a return equal to the total return on one or more of the Morgan Stanley funds that are offered as investment options under the Compensation Plan. Appreciation/depreciation and distributions received from these investments are recorded with an offsetting increase/decrease in the deferred compensation obligation and do not affect the net asset value of the Fund.

21

Morgan Stanley Technology Fund

Notes to Financial Statements - March 31, 2009 continued

5. Expense Offset

The expense offset represents a reduction of the fees and expenses for interest earned on cash balances maintained by the Fund with the transfer agent.

6. Shares of Beneficial Interest

Transactions in shares of beneficial interest were as follows:

	FOR THE YEAR						FOR THE YEAR
	ENDED						ENDED
	MARCH 31, 2009						MARCH 31, 2008
	SHARES			AMOUNT			SHARES			AMOUNT
CLASS A SHARES
Sold		3,503,444		$	27,851,568			795,995		$	11,001,064
Conversion from Class B		660,261			4,661,856			2,434,604			25,942,311
Redeemed		(2,248,434	)		(19,087,970	)		(2,374,688	)		(26,918,634	)
Net increase – Class A		1,915,271			13,425,454			855,911			10,024,741
CLASS B SHARES
Sold		102,739			759,509			163,551			1,749,668
Conversion to Class A		(602,066	)		(4,661,856	)		(2,236,583	)		(25,942,311	)
Redeemed		(5,111,845	)		(37,595,429	)		(4,342,753	)		(42,737,672	)
Net decrease – Class B		(5,611,172	)		(41,497,776	)		(6,415,785	)		(66,930,315	)
CLASS C SHARES
Sold		26,122			218,249			53,616			582,815
Redeemed		(321,837	)		(2,566,430	)		(441,509	)		(4,588,133	)
Net decrease – Class C		(295,715	)		(2,348,181	)		(387,893	)		(4,005,318	)
CLASS I SHARES
Sold		24,243			269,573			31,046			357,985
Redeemed		(75,655	)		(795,780	)		(119,447	)		(1,471,657	)
Net decrease – Class I		(51,412	)		(526,207	)		(88,401	)		(1,113,672	)
Net decrease in Fund		(4,043,028	)	$	(30,946,710	)		(6,036,168	)	$	(62,024,564	)

7. Federal Income Tax Status

The amount of dividends and distributions from net investment income and net realized capital gains are determined in accordance with federal income tax regulations which may differ from generally accepted accounting principles. These “book/tax” differences are either considered temporary or permanent in nature. To the extent these differences are permanent in nature, such amounts are reclassified within the capital accounts based on their federal tax-basis treatment; temporary differences do not require reclassification. Dividends and distributions which exceed net investment income and net realized capital gains for tax purposes are reported as distributions of paid-in-capital.

22

Morgan Stanley Technology Fund

Notes to Financial Statements - March 31, 2009 continued

As of March 31, 2009, the tax-basis components of accumulated losses were as follows:

Net accumulated earnings		—
Capital loss carryforward	$	(2,003,867,433	)
Post-October losses		(1,883,173	)
Temporary differences		(356	)
Net unrealized depreciation		(36,821,518	)
Total accumulated losses	$	(2,042,572,480	)

As of March 31, 2009, the Fund had a net capital loss carryforward of $2,003,867,433, to offset future capital gains to the extent provided by regulations, which will expire according to the following schedule.

AMOUNT		EXPIRATION
$	1,275,591,838		March 31, 2010
	670,621,776		March 31, 2011
	25,113,400		March 31, 2012
	19,506,592		March 31, 2015
	13,033,827		March 31, 2017

As of March 31, 2009, the Fund had temporary book/tax differences primarily attributable to post-October losses (capital and foreign currency losses incurred after October 31 within the taxable year which are deemed to arise on the first business day of the Fund’s next taxable year) and capital loss deferrals on wash sales.

Permanent differences, primarily due to foreign currency losses, a net operating loss and an expired capital loss carryforward, resulted in the following reclassifications among the Fund’s components of net assets at March 31, 2009:

ACCUMULATED		ACCUMULATED
NET INVESTMENT		NET REALIZED
LOSS		LOSS		PAID-IN-CAPITAL
$	2,415,442	$	140,023,493	$	(142,438,935	)

8. Purposes of and Risks Relating to Certain Financial Instruments

The Fund may enter into forward contracts for many purposes, including to facilitate settlement of foreign currency denominated portfolio transactions or to manage foreign currency exposure associated with foreign currency denominated securities.

For hedging and investment purposes, the Fund may also engage in transactions in listed and over-the-counter options. Risks may arise from an imperfect correlation between the change in the market of the securities held by the Fund, the prices of options relating to the securities purchased or sold by the Fund and from the possible lack of a liquid secondary market for an option.

These forward and option contracts involve elements of market risk in excess of the amounts reflected in the Statement of Assets and Liabilities. The Fund bears the risk of an unfavorable change in the foreign

23

Morgan Stanley Technology Fund

Notes to Financial Statements - March 31, 2009 continued

exchange rates underlying the forward contracts or in the value of the underlying securities. Risks may also arise upon entering into these contracts from the potential inability of the counterparties to meet the terms of their contracts.

The Fund may lend securities to qualified financial institutions, such as broker-dealers, to earn additional income. Risks in securities lending transactions are that a borrower may not provide additional collateral when required or return the securities when due, and that the value of the short-term investments will be less than the amount of cash collateral plus any rebate that is required to be returned to the borrower.

9. Legal Matters

Beginning October 25, 2002, purported class action complaints were filed in the United States District Court for the Southern District of New York against Morgan Stanley, the Fund (under its former name, the Morgan Stanley Information Fund), Morgan Stanley Investment Advisors Inc., and certain subsidiaries of Morgan Stanley alleging violations of certain federal securities laws in connection with the underwriting and management of the Fund. These actions were consolidated into one action in which plaintiffs allege, among other things, that the prospectuses and registration statements for the Fund improperly failed to disclose that research analysts employed by Morgan Stanley DW Inc. were issuing overly optimistic stock recommendations to help Morgan Stanley obtain investment banking business, and that certain of these reports concerned companies in which the Fund was investing. A similar consolidated complaint was filed with respect to the fund formerly called the Morgan Stanley Technology Fund, which merged with the Fund on October 6, 2003. Both consolidated complaints were stayed pending a decision by the United States Court of Appeals for the Second Circuit of an appeal from the dismissal of a very similar complaint filed by plaintiffs against another mutual funds complex. The case involving the other mutual funds complex has settled. Thereafter, Plaintiffs filed a Second Amended Consolidated Complaint against the Fund, Morgan Stanley Investment Advisors Inc., and certain subsidiaries of Morgan Stanley, and also filed a Second Amended Consolidated Complaint against the fund formerly called the Morgan Stanley Technology Fund, Morgan Stanley Investment Advisors Inc., and certain subsidiaries of Morgan Stanley. The defendants moved to dismiss both Complaints and that motion to dismiss was granted on February 2, 2009. The plaintiffs are currently appealing that decision to the United States Court of Appeals for the Second Circuit.

The Fund and Morgan Stanley believe these lawsuits have no merit. However, the ultimate outcome of these matters is not presently determinable and no provision has been made in the Fund’s financial statements for the effect, if any, of such matters. The Investment Manager has agreed to indemnify the Fund against any losses and claims associated with the complaint filed against the fund formerly called the Morgan Stanley Technology Fund.

24

Morgan Stanley Technology Fund

Notes to Financial Statements - March 31, 2009 continued

10. Fair Valuation Measurements

The Fund adopted FASB Statement of Financial Accounting Standards No. 157, Fair Value Measurements (“SFAS 157”), effective April 1, 2008. In accordance with SFAS 157, fair value is defined as the price that the Fund would receive to sell an investment or pay to transfer a liability in a timely transaction with an independent buyer in the principal market, or in the absence of a principal market the most advantageous market for the investment or liability. SFAS 157 establishes a three-tier hierarchy to distinguish between (1) inputs that reflect the assumptions market participants would use in pricing an asset or liability developed based on market data obtained from sources independent of the reporting entity (observable inputs) and (2) inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing an asset or liability developed based on the best information available in the circumstances (unobservable inputs) and to establish classification of fair value measurements for disclosure purposes. Various inputs are used in determining the value of the Fund’s investments. The inputs are summarized in the three broad levels listed below.

•  Level 1 — quoted prices in active markets for identical investments

•  Level 2 — other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

•  Level 3 — significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities and the determination of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to each security.

The following is a summary of the inputs used as of March 31, 2009 in valuing the Fund’s investments carried at value:

			FAIR VALUE MEASUREMENTS AT MARCH 31, 2009 USING
			QUOTED PRICES IN		SIGNIFICANT		SIGNIFICANT
			ACTIVE MARKET FOR		OTHER OBSERVABLE		UNOBSERVABLE
			IDENTICAL ASSETS		INPUTS		INPUTS
	TOTAL		(LEVEL 1)		(LEVEL 2)		(LEVEL 3)
Investments in Securities	$	125,856,058	$	123,203,390	$	2,652,668	$	0

The Fund held one level 3 security with a value of $0 for the entire period.

11. Accounting Pronouncements

On March 19, 2008, FASB released Statement of Financial Accounting Standards No. 161, Disclosures about Derivative Instruments and Hedging Activities, an amendment of FASB Statement No. 133

25

Morgan Stanley Technology Fund

Notes to Financial Statements - March 31, 2009 continued

(“SFAS 161”). SFAS 161 requires qualitative disclosures about objectives and strategies for using derivatives, quantitative disclosures about fair value amounts of gains and losses on derivative instruments, and disclosures about credit-risk related contingent features in derivative agreements. The application of SFAS 161 is required for fiscal years beginning after November 15, 2008 and interim periods within those fiscal years. At this time, management is evaluating the implications of SFAS 161 and its impact on the Fund’s financial statements has not yet been determined.

On April 9, 2009, FASB issued Staff Position No. 157-4, Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly (“FSP 157-4”). FSP 157-4 provides additional guidance for estimating fair value in accordance with SFAS 157, when the volume and level of activity for the asset or liability have significantly decreased. FSP 157-4 also requires additional disaggregation of the current SFAS 157 required disclosures. FSP 157-4 is effective for interim and annual reporting periods ending after June 15, 2009, and shall be applied prospectively. At this time, management is evaluating the implications of FSP 157-4 and the impact it will have on the Fund’s financial statements.

26

Morgan Stanley Technology Fund

Financial Highlights

Selected ratios and per share data for a share of beneficial interest outstanding throughout each period:

	FOR THE YEAR ENDED MARCH 31,
	2009				2008				2007				2006				2005
Class A Shares
Selected Per Share Data:
Net asset value, beginning of period		$10.32				$10.42				$10.68				$ 9.47				$10.14
Income (loss) from investment operations:
Net investment loss(1)		(0.11	)			(0.13	)			(0.13	)			(0.12	)			(0.05	)
Net realized and unrealized gain (loss)		(3.09	)			0.03				(0.13	)			1.33				(0.62	)
Total income (loss) from investment operations		(3.20	)			(0.10	)			(0.26	)			1.21				(0.67	)
Net asset value, end of period		$ 7.12				$10.32				$10.42				$10.68				$ 9.47
Total Return(2)		(31.01	)	%		(0.96	)	%		(2.43	)	%		12.78		%		(6.61	)	%
Ratios to Average Net Assets(3):
Total expenses (before expense offset)		2.00%(4	)			1.72%(4	)			1.80		%		1.67		%		1.49		%
Net investment loss		(1.32	)	%(4)		(1.18	)	%(4)		(1.27	)	%		(1.19	)	%		(0.58	)	%
Supplemental Data:
Net assets, end of period, in thousands		$78,705				$94,361				$86,308				$110,847				$38,891
Portfolio turnover rate		81		%		122		%		100		%		177		%		106		%

(1)	The per share amounts were computed using an average number of shares outstanding during the period.
(2)	Does not reflect the deduction of sales charge. Calculated based on the net asset value as of the last business day of the period.
(3)	Reflects overall Fund ratios for investment income and non-class specific expenses.
(4)	Reflects rebate of certain Fund expenses in connection with the investments in Morgan Stanley Institutional Liquidity Funds – Money Market Portfolio – Institutional Class during the period. The rebate had an effect of less than 0.005%.

See Notes to Financial Statements

27

Morgan Stanley Technology Fund

Financial Highlights continued

	FOR THE YEAR ENDED MARCH 31,
	2009				2008				2007				2006				2005
Class B Shares
Selected Per Share Data:
Net asset value, beginning of period		$9.45				$9.61				$9.92				$8.87				$9.58
Income (loss) from investment operations:
Net investment loss(1)		(0.17	)			(0.20	)			(0.19	)			(0.19	)			(0.13	)
Net realized and unrealized gain (loss)		(2.81	)			0.04				(0.12	)			1.24				(0.58	)
Total income (loss) from investment operations		(2.98	)			(0.16	)			(0.31	)			1.05				(0.71	)
Net asset value, end of period		$6.47				$9.45				$9.61				$9.92				$8.87
Total Return(2)		(31.53	)	%		(1.66	)	%		(3.13	)	%		11.84		%		(7.41	)	%
Ratios to Average Net Assets(3):
Total expenses (before expense offset)		2.75%(4	)			2.47%(4	)			2.55		%		2.45		%		2.35		%
Net investment loss		(2.07	)	%(4)		(1.93	)	%(4)		(2.02	)	%		(1.97	)	%		(1.44	)	%
Supplemental Data:
Net assets, end of period, in thousands		$19,556				$81,609				$144,588				$242,405				$421,973
Portfolio turnover rate		81		%		122		%		100		%		177		%		106		%

(1)	The per share amounts were computed using an average number of shares outstanding during the period.
(2)	Does not reflect the deduction of sales charge. Calculated based on the net asset value as of the last business day of the period.
(3)	Reflects overall Fund ratios for investment income and non-class specific expenses.
(4)	Reflects rebate of certain Fund expenses in connection with the investments in Morgan Stanley Institutional Liquidity Funds – Money Market Portfolio – Institutional Class during the period. The rebate had an effect of less than 0.005%.

See Notes to Financial Statements

28

Morgan Stanley Technology Fund

Financial Highlights continued

	FOR THE YEAR ENDED MARCH 31,
	2009				2008				2007				2006				2005
Class C Shares
Selected Per Share Data:
Net asset value, beginning of period		$9.44				$9.60				$9.92				$8.86				$9.57
Income (loss) from investment operations:
Net investment loss(1)		(0.17	)			(0.20	)			(0.19	)			(0.19	)			(0.13	)
Net realized and unrealized gain (loss)		(2.81	)			0.04				(0.13	)			1.25				(0.58	)
Total income (loss) from investment operations		(2.98	)			(0.16	)			(0.32	)			1.06				(0.71	)
Net asset value, end of period		$6.46				$9.44				$9.60				$9.92				$8.86
Total Return(2)		(31.57	)	%		(1.67	)	%		(3.23	)	%		11.96		%		(7.42	)	%
Ratios to Average Net Assets(3):
Total expenses (before expense offset)		2.75%(4	)			2.47%(4	)			2.55		%		2.45		%		2.34		%
Net investment loss		(2.07	)	%(4)		(1.93	)	%(4)		(2.02	)	%		(1.97	)	%		(1.43	)	%
Supplemental Data:
Net assets, end of period, in thousands		$8,927				$15,835				$19,823				$30,866				$39,754
Portfolio turnover rate		81		%		122		%		100		%		177		%		106		%

(1)	The per share amounts were computed using an average number of shares outstanding during the period.
(2)	Does not reflect the deduction of sales charge. Calculated based on the net asset value as of the last business day of the period.
(3)	Reflects overall Fund ratios for investment income and non-class specific expenses.
(4)	Reflects rebate of certain Fund expenses in connection with the investments in Morgan Stanley Institutional Liquidity Funds – Money Market Portfolio – Institutional Class during the period. The rebate had an effect of less than 0.005%.

See Notes to Financial Statements

29

Morgan Stanley Technology Fund

Financial Highlights continued

	FOR THE YEAR ENDED MARCH 31,
	2009				2008				2007				2006				2005
Class I Shares
Selected Per Share Data:
Net asset value, beginning of period		$10.60				$10.67				$10.91				$ 9.65				$10.32
Income (loss) from investment operations:
Net investment loss(1)		(0.09	)			(0.11	)			(0.10	)			(0.10	)			(0.04	)
Net realized and unrealized gain (loss)		(3.18	)			0.04				(0.14	)			1.36				(0.63	)
Total income (loss) from investment operations		(3.27	)			(0.07	)			(0.24	)			1.26				(0.67	)
Net asset value, end of period		$ 7.33				$10.60				$10.67				$10.91				$ 9.65
Total Return(2)		(30.85	)	%		(0.66	)	%		(2.20	)	%		13.06		%		(6.49	)	%
Ratios to Average Net Assets(3):
Total expenses (before expense offset)		1.75%(4	)			1.47%(4	)			1.55		%		1.45		%		1.35		%
Net investment loss		(1.07	)	%(4)		(0.93	)	%(4)		(1.02	)	%		(0.97	)	%		(0.44	)	%
Supplemental Data:
Net assets, end of period, in thousands		$218				$860				$1,809				$6,537				$8,051
Portfolio turnover rate		81		%		122		%		100		%		177		%		106		%

(1)	The per share amounts were computed using an average number of shares outstanding during the period.
(2)	Calculated based on the net asset value as of the last business day of the period.
(3)	Reflects overall Fund ratios for investment income and non-class specific expenses.
(4)	Reflects rebate of certain Fund expenses in connection with the investments in Morgan Stanley Institutional Liquidity Funds – Money Market Portfolio – Institutional Class during the period. The rebate had an effect of less than 0.005%.

See Notes to Financial Statements

30

Morgan Stanley Technology Fund

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Trustees of
Morgan Stanley Technology Fund:

We have audited the accompanying statement of assets and liabilities of Morgan Stanley Technology Fund (the “Fund”), including the portfolio of investments, as of March 31, 2009, and the related statement of operations for the year then ended and the statements of changes in 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. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). 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. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, 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. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of March 31, 2009, by correspondence with the custodian and brokers; where replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Morgan Stanley Technology Fund as of March 31, 2009, 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.

Deloitte & Touche LLP
New York, New York
May 26, 2009

31

Morgan Stanley Technology Fund

An Important Notice Concerning Our U.S. Privacy Policy (unaudited)

We are required by federal law to provide you with a copy of our Privacy Policy annually.

The following Policy applies to current and former individual investors in Morgan Stanley Advisor funds. This Policy is not applicable to partnerships, corporations, trusts or other non-individual clients or account holders. Please note that we may amend this Policy at any time, and will inform you of any changes to this Policy as required by law.

We Respect Your Privacy

We appreciate that you have provided us with your personal financial information. We strive to maintain the privacy of such information while we help you achieve your financial objectives. This Policy describes what non-public personal information we collect about you, why we collect it, and when we may share it with others. We hope this Policy will help you understand how we collect and share non-public personal information that we gather about you. Throughout this Policy, we refer to the non-public information that personally identifies you or your accounts as “personal information.”

1. What Personal Information Do We Collect About You?

To serve you better and manage our business, it is important that we collect and maintain accurate information about you. We may obtain this information from applications and other forms you submit to us, from your dealings with us, from consumer reporting agencies, from our Web sites and from third parties and other sources.

For example:

•  We may collect information such as your name, address, e-mail address, telephone/fax numbers, assets, income and investment objectives through applications and other forms you submit to us.

•  We may obtain information about account balances, your use of account(s) and the types of products and services you prefer to receive from us through your dealings and transactions with us and other sources.

•  We may obtain information about your creditworthiness and credit history from consumer reporting agencies.

•  We may collect background information from and through third-party vendors to verify representations you have made and to comply with various regulatory requirements.

•  If you interact with us through our public and private Web sites, we may collect information that you provide directly through online communications (such as an e-mail address). We may also collect information about your Internet service provider, your domain name, your computer’s operating system and Web browser, your use of our Web sites and your product and service preferences, through the use of “cookies.” “Cookies” recognize your computer each time your return to one of our sites, and help to improve our sites’ content and personalize your experience on our sites by, for example, suggesting

32

Morgan Stanley Technology Fund

An Important Notice Concerning Our U.S. Privacy Policy (unaudited) continued

offerings that may interest you. Please consult the Terms of Use of these sites for more details on our use of cookies.

2. When Do We Disclose Personal Information We Collect About You?

To provide you with the products and services you request, to serve you better and to manage our business, we may disclose personal information we collect about you to our affiliated companies and to non-affiliated third parties as required or permitted by law.

A. Information We Disclose to Our Affiliated Companies.  We do not disclose personal information that we collect about you to our affiliated companies except to enable them to provide services on our behalf or as otherwise required or permitted by law.

B. Information We Disclose to Third Parties.  We do not disclose personal information that we collect about you to non-affiliated third parties except to enable them to provide services on our behalf, to perform joint marketing agreements with other financial institutions, or as otherwise required or permitted by law. For example, some instances where we may disclose information about you to nonaffiliated third parties include: for servicing and processing transactions, to offer our own products and services, to protect against fraud, for institutional risk control, to respond to judicial process or to perform services on our behalf. When we share personal information with these companies, they are required to limit their use of personal information to the particular purpose for which it was shared and they are not allowed to share personal information with others except to fulfill that limited purpose.

3. How Do We Protect the Security and Confidentiality of Personal Information We Collect About You?

We maintain physical, electronic and procedural security measures to help safeguard the personal information we collect about you. We have internal policies governing the proper handling of client information. Third parties that provide support or marketing services on our behalf may also receive personal information, and we require them to adhere to confidentiality standards with respect to such information.

33

Morgan Stanley Technology Fund

Trustee and Officer Information (unaudited)

Independent Trustees:

				Number of
				Portfolios
				in Fund
		Term of		Complex
		Office and		Overseen
	Position(s)	Length of		by
Name, Age and Address of	Held with	Time	Principal Occupation(s)	Independent		Other Directorships
Independent Trustee	Registrant	Served*	During Past 5 Years	Trustee**		Held by Independent Trustee
Frank L. Bowman (64) c/o Kramer Levin Naftalis & Frankel LLP Counsel to the Independent Trustees 1177 Avenue of the Americas New York, NY 10036	Trustee	Since August 2006	President, Strategic Decisions, LLC (consulting) (since February 2009); Director or Trustee of various Retail Funds and Institutional Funds (since August 2006); Chairperson of the Insurance Sub-Committee of the Compliance and Insurance Committee (since February 2007); served as President and Chief Executive Officer of the Nuclear Energy Institute (policy organization) through November 2008; retired as Admiral, U.S. Navy in January 2005 after serving over 8 years as Director of the Naval Nuclear Propulsion Program and Deputy Administrator–Naval Reactors in the National Nuclear Security Administration at the U.S. Department of Energy (1996-2004), Knighted as Honorary Knight Commander of the Most Excellent Order of the British Empire; Awarded the Officer de l’Orde National du Mérite by the French Government.		168	Director of the Armed Services YMCA of the USA; member, BP America External Advisory Council (energy); member, National Academy of Engineers.
Michael Bozic (68) c/o Kramer Levin Naftalis & Frankel LLP Counsel to the Independent Trustees 1177 Avenue of the Americas New York, NY 10036	Trustee	Since April 1994	Private investor; Chairperson of the Compliance and Insurance Committee (since October 2006); Director or Trustee of the Retail Funds (since April 1994) and Institutional Funds (since July 2003); formerly, Chairperson of the Insurance Committee (July 2006-September 2006); Vice Chairman of Kmart Corporation (December 1998-October 2000), Chairman and Chief Executive Officer of Levitz Furniture Corporation (November 1995-November 1998) and President and Chief Executive Officer of Hills Department Stores (May 1991-July 1995); variously Chairman, Chief Executive Officer, President and Chief Operating Officer (1987-1991) of the Sears Merchandise Group of Sears, Roebuck & Co.		170	Director of various business organizations.

34

Morgan Stanley Technology Fund

Trustee and Officer Information (unaudited) continued

				Number of
				Portfolios
				in Fund
		Term of		Complex
		Office and		Overseen
	Position(s)	Length of		by
Name, Age and Address of	Held with	Time	Principal Occupation(s)	Independent		Other Directorships
Independent Trustee	Registrant	Served*	During Past 5 Years	Trustee**		Held by Independent Trustee
Kathleen A. Dennis (55) c/o Kramer Levin Naftalis & Frankel LLP Counsel to the Independent Trustees 1177 Avenue of the Americas New York, NY 10036	Trustee	Since August 2006	President, Cedarwood Associates (mutual fund and investment management) (since July 2006); Chairperson of the Money Market and Alternatives Sub-Committee of the Investment Committee (since October 2006) and Director or Trustee of various Retail Funds and Institutional Funds (since August 2006); formerly, Senior Managing Director of Victory Capital Management (1993-2006).		168	Director of various non-profit organizations.
Dr. Manuel H. Johnson (60) c/o Johnson Smick Group, Inc. 888 16th Street, N.W. Suite 740 Washington, D.C. 20006	Trustee	Since July 1991	Senior Partner, Johnson Smick International, Inc. (consulting firm); Chairperson of the Investment Committee (since October 2006) and Director or Trustee of the Retail Funds (since July 1991) and Institutional Funds (since July 2003); Co-Chairman and a founder of the Group of Seven Council (G7C) (international economic commission); formerly, Chairperson of the Audit Committee (July 1991-September 2006); Vice Chairman of the Board of Governors of the Federal Reserve System and Assistant Secretary of the U.S. Treasury.		170	Director of NVR, Inc. (home construction); Director of Evergreen Energy.
Joseph J. Kearns (66) c/o Kearns & Associates LLC PMB754 23852 Pacific Coast Highway Malibu, CA 90265	Trustee	Since August 1994	President, Kearns & Associates LLC (investment consulting); Chairperson of the Audit Committee (since October 2006) and Director or Trustee of the Retail Funds (since July 2003) and Institutional Funds (since August 1994); formerly, Deputy Chairperson of the Audit Committee (July 2003-September 2006) and Chairperson of the Audit Committee of Institutional Funds (October 2001-July 2003); CFO of the J. Paul Getty Trust.		171	Director of Electro Rent Corporation (equipment leasing) and The Ford Family Foundation.

35

Morgan Stanley Technology Fund

Trustee and Officer Information (unaudited) continued

				Number of
				Portfolios
				in Fund
		Term of		Complex
		Office and		Overseen
	Position(s)	Length of		by
Name, Age and Address of	Held with	Time	Principal Occupation(s)	Independent		Other Directorships
Independent Trustee	Registrant	Served*	During Past 5 Years	Trustee**		Held by Independent Trustee
Michael F. Klein (50) c/o Kramer Levin Naftalis & Frankel LLP Counsel to the Independent Trustees 1177 Avenue of the Americas New York, NY 10036	Trustee	Since August 2006	Managing Director, Aetos Capital, LLC (since March 2000) and Co-President, Aetos Alternatives Management, LLC (since January 2004); Chairperson of the Fixed Income Sub-Committee of the Investment Committee (since October 2006) and Director or Trustee of various Retail Funds and Institutional Funds (since August 2006); formerly, Managing Director, Morgan Stanley & Co. Inc. and Morgan Stanley Dean Witter Investment Management, President, Morgan Stanley Institutional Funds (June 1998-March 2000) and Principal, Morgan Stanley & Co. Inc. and Morgan Stanley Dean Witter Investment Management (August 1997-December 1999).		168	Director of certain investment funds managed or sponsored by Aetos Capital, LLC. Director of Sanitized AG and Sanitized Marketing AG (specialty chemicals).
Michael E. Nugent (72) c/o Triumph Capital, L.P. 445 Park Avenue New York, NY 10022	Chairperson of the Board and Trustee	Chairperson of the Boards since July 2006 and Trustee since July 1991	General Partner, Triumph Capital, L.P. (private investment partnership); Chairperson of the Boards of the Retail Funds and Institutional Funds (since July 2006); Director or Trustee of the Retail Funds (since July 1991) and Institutional Funds (since July 2001); formerly, Chairperson of the Insurance Committee (until July 2006).		170	None.
W. Allen Reed (62)† c/o Kramer Levin Naftalis & Frankel LLP Counsel to the Independent Trustees 1177 Avenue of the Americas New York, NY 10036	Trustee	Since August 2006	Chairperson of the Equity Sub-Committee of the Investment Committee (since October 2006) and Director or Trustee of various Retail Funds and Institutional Funds (since August 2006); formerly, President and CEO of General Motors Asset Management; Chairman and Chief Executive Officer of the GM Trust Bank and Corporate Vice President of General Motors Corporation (August 1994-December 2005).		168	Director of Temple-Inland Industries (packaging and forest products); Director of Legg Mason, Inc. and Director of the Auburn University Foundation.

36

Morgan Stanley Technology Fund

Trustee and Officer Information (unaudited) continued

				Number of
				Portfolios
				in Fund
		Term of		Complex
		Office and		Overseen
	Position(s)	Length of		by
Name, Age and Address of	Held with	Time	Principal Occupation(s)	Independent		Other Directorships
Independent Trustee	Registrant	Served*	During Past 5 Years	Trustee**		Held by Independent Trustee
Fergus Reid (76) c/o Lumelite Plastics Corporation 85 Charles Colman Blvd. Pawling, NY 12564	Trustee	Since June 1992	Chairman of Lumelite Plastics Corporation; Chairperson of the Governance Committee and Director or Trustee of the Retail Funds (since July 2003) and Institutional Funds (since June 1992).		171	Trustee and Director of certain investment companies in the JPMorgan Funds complex managed by JPMorgan Investment Management Inc.
Interested Trustee:
				Number of
				Portfolios
				in Fund
		Term of		Complex
		Office and		Overseen
	Position(s)	Length of		by
Name, Age and Address of	Held with	Time	Principal Occupation(s)	Interested		Other Directorships
Interested Trustee	Registrant	Served*	During Past 5 Years	Trustee**		Held by Interested Trustee
James F. Higgins (61) c/o Morgan Stanley Trust Harborside Financial Center Plaza Two Jersey City, NJ 07311	Trustee	Since June 2000	Director or Trustee of the Retail Funds (since June 2000) and Institutional Funds (since July 2003); Senior Advisor of Morgan Stanley (since August 2000).		169	Director of AXA Financial, Inc. and The Equitable Life Assurance Society of the United States (financial services).

*	This is the earliest date the Trustee began serving the funds advised by Morgan Stanley Investment Advisors Inc. (the “Investment Adviser”) (the “Retail Funds”) or the funds advised by Morgan Stanley Investment Management Inc. and Morgan Stanley AIP GP LP (the “Institutional Funds”).
**	The Fund Complex includes all open-end and closed-end funds (including all of their portfolios) advised by the Investment Adviser and any funds that have an investment adviser that is an affiliated person of the Investment Adviser (including, but not limited to, Morgan Stanley Investment Management Inc.).
†	For the period September 26, 2008 through February 5, 2009, W. Allen Reed was an Interested Trustee. At all other times covered by this report, Mr. Reed was an Independent Trustee.

37

Morgan Stanley Technology Fund

Trustee and Officer Information (unaudited) continued

Executive Officers:

		Term of
		Office and
	Position(s)	Length of
Name, Age and Address of	Held with	Time
Executive Officer	Registrant	Served*	Principal Occupation(s) During Past 5 Years
Randy Takian (34) 522 Fifth Avenue New York, NY 10036	President and Principal Executive Officer	President and Principal Executive Officer (since September 2008)	President and Principal Executive Officer (since September 2008) of funds in the Fund Complex; President and Chief Executive Officer of Morgan Stanley Services Company Inc. (since September 2008). President of the Investment Adviser (since July 2008). Head of the Retail and Intermediary business within Morgan Stanley Investment Management (since July 2008). Head of Liquidity and Bank Trust business (since July 2008) and the Latin American franchise (since July 2008) at Morgan Stanley Investment Management. Managing Director, Director and/or Officer of the Investment Adviser and various entities affiliated with the Investment Adviser. Formerly Head of Strategy and Product Development for the Alternatives Group and Senior Loan Investment Management. Formerly with Bank of America (July 1996-March 2006), most recently as Head of the Strategy, Mergers and Acquisitions team for Global Wealth and Investment Management.
Kevin Klingert (46) 522 Fifth Avenue New York, NY 10036	Vice President	Since June 2008	Global Head, Chief Operating Officer and acting Chief Investment Officer of the Global Fixed Income Group of Morgan Stanley Investment Management Inc. and the Investment Adviser (since April 2008). Head of Global Liquidity Portfolio Management and co-Head of Liquidity Credit Research of Morgan Stanley Investment Management (since December 2007). Managing Director of Morgan Stanley Investment Management Inc. and the Investment Adviser (since December 2007). Previously, Managing Director on the Management Committee and head of Municipal Portfolio Management and Liquidity at BlackRock (October 1991 to January 2007).
Carsten Otto (45) 522 Fifth Avenue New York, NY 10036	Chief Compliance Officer	Since October 2004	Managing Director and Global Head of Compliance for Morgan Stanley Investment Management (since April 2007) and Chief Compliance Officer of the Retail Funds and Institutional Funds (since October 2004). Formerly, U.S. Director of Compliance (October 2004-April 2007) and Assistant Secretary and Assistant General Counsel of the Retail Funds.
Stefanie V. Chang Yu (42) 522 Fifth Avenue New York, NY 10036	Vice President	Since December 1997	Managing Director of the Investment Adviser and various entities affiliated with the Investment Adviser; Vice President of the Retail Funds (since July 2002) and Institutional Funds (since December 1997); Secretary of various entities affiliated with the Investment Adviser.
Francis J. Smith (43) c/o Morgan Stanley Trust Harborside Financial Center Plaza Two Jersey City, NJ 07311	Treasurer and Chief Financial Officer	Treasurer since July 2003 and Chief Financial Officer since September 2002	Executive Director of the Investment Adviser and various entities affiliated with the Investment Adviser; Treasurer and Chief Financial Officer of the Retail Funds (since July 2003).
Mary E. Mullin (42) 522 Fifth Avenue New York, NY 10036	Secretary	Since June 1999	Executive Director of the Investment Adviser and various entities affiliated with the Investment Adviser; Secretary of the Retail Funds (since July 2003) and Institutional Funds (since June 1999).

* This is the earliest date the Officer began serving the Retail Funds or Institutional Funds.

38

Trustees

Frank L. Bowman

Michael Bozic

Kathleen A. Dennis

James F. Higgins

Dr. Manuel H. Johnson

Joseph J. Kearns

Michael F. Klein

Michael E. Nugent

W. Allen Reed

Fergus Reid

Officers

Michael E. Nugent

Chairperson of the Board

Randy Takian

President and Principal Executive Officer

Kevin Klingert

Vice President

Carsten Otto

Chief Compliance Officer

Stefanie V. Chang Yu

Vice President

Francis J. Smith

Treasurer and Chief Financial Officer

Mary E. Mullin

Secretary

Transfer Agent

Morgan Stanley Trust

Harborside Financial Center, Plaza Two

Jersey City, New Jersey 07311

Independent Registered Public Accounting Firm

Deloitte & Touche LLP

Two World Financial Center

New York, New York 10281

Legal Counsel

Clifford Chance US LLP

31 West 52nd Street

New York, New York 10019

Counsel to the Independent Trustees

Kramer Levin Naftalis & Frankel LLP

1177 Avenue of the Americas

New York, New York 10036

Investment Adviser

Morgan Stanley Investment Advisors Inc.

522 Fifth Avenue

New York, New York 10036

Sub-Adviser

Morgan Stanley Investment Management Limited

25 Cabot Square, Canary Wharf

London E14 4QA England

This report is submitted for the general information of the shareholders of the Fund. For more detailed information about the Fund, its fees and expenses and other pertinent information, please read its Prospectus. The Fund’s Statement of Additional Information contains additional information about the Fund, including its trustees. It is available, without charge, by calling (800) 869-NEWS.

This report is not authorized for distribution to prospective investors in the Fund unless preceded or accompanied by an effective Prospectus. Read the Prospectus carefully before investing.

Morgan Stanley Distributors Inc., member FINRA.

(c)  2009 Morgan Stanley

INVESTMENT MANAGEMENT

Morgan Stanley

Technology Fund

Annual Report

March 31, 2009

TECHANN

IU09-02294P-Y03/09

Item 2. Code of Ethics.

(a) The Fund has adopted a code of ethics (the “Code of Ethics”) that applies to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the Fund or a third party.

(b) No information need be disclosed pursuant to this paragraph.

(c) Not applicable.

(d) Not applicable.

(e) Not applicable.

(f)

(1)	The Fund’s Code of Ethics is attached hereto as Exhibit 12 A.
(2)	Not applicable.
(3)	Not applicable.

Item 3. Audit Committee Financial Expert.

The Fund’s Board of Trustees has determined that Joseph J. Kearns, an “independent” Trustee, is an “audit committee financial expert” serving on its audit committee. Under applicable securities laws, a person who is determined to be an audit committee financial expert will not be deemed an “expert” for any purpose, including without limitation for the purposes of Section 11 of the Securities Act of 1933, as a result of being designated or identified as an audit committee financial expert. The designation or identification of a person as an audit committee financial expert does not impose on such person any duties, obligations, or liabilities that are greater than the duties, obligations, and liabilities imposed on such person as a member of the audit committee and Board of Trustees in the absence of such designation or identification

2

Item 4. Principal Accountant Fees and Services.

(a)(b)(c)(d) and (g). Based on fees billed for the periods shown:

2009

	Registrant			Covered Entities(1)
Audit Fees	$	42,550			N/A
Non-Audit Fees
Audit-Related Fees	$	—	(2)	$	6,418,000	(2)
Tax Fees	$	6,225	(3)	$	881,000	(4)
All Other Fees	$			$
Total Non-Audit Fees	$	6,225		$	7,299,000
Total	$	48,775		$	7,299,000

2008

	Registrant			Covered Entities(1)
Audit Fees	$	39,300			N/A
Non-Audit Fees
Audit-Related Fees	$	—	(2)	$	6,767,000	(2)
Tax Fees	$	5,459	(3)	$	1,310,000	(4)
All Other Fees	$			$		(5)
Total Non-Audit Fees	$	5,459		$	8,077,000
Total	$	44,759		$	8,077,000

N/A- Not applicable, as not required by Item 4.

(1)	Covered Entities include the Adviser (excluding sub-advisors) and any entity controlling, controlled by or under common control with the Adviser that provides ongoing services to the Registrant.
(2)	Audit-Related Fees represent assurance and related services provided that are reasonably related to the performance of the audit of the financial statements of the Covered Entities’ and funds advised by the Adviser or its affiliates, specifically data verification and agreed-upon procedures related to asset securitizations and agreed-upon procedures engagements.
(3)	Tax Fees represent tax compliance, tax planning and tax advice services provided in connection with the preparation and review of the Registrant’s tax returns.
(4)	Tax Fees represent tax compliance, tax planning and tax advice services provided in connection with the review of Covered Entities’ tax returns.
(5)	All other fees represent project management for future business applications and improving business and operational processes.

(e)(1) The audit committee’s pre-approval policies and procedures are as follows:

3

APPENDIX A

AUDIT COMMITTEE
AUDIT AND NON-AUDIT SERVICES
PRE-APPROVAL POLICY AND PROCEDURES
OF THE
MORGAN STANLEY RETAIL AND INSTITUTIONAL FUNDS

AS ADOPTED AND AMENDED JULY 23, 2004,¹

     1. Statement of Principles

The Audit Committee of the Board is required to review and, in its sole discretion, pre-approve all Covered Services to be provided by the Independent Auditors to the Fund and Covered Entities in order to assure that services performed by the Independent Auditors do not impair the auditor’s independence from the Fund.

The SEC has issued rules specifying the types of services that an independent auditor may not provide to its audit client, as well as the audit committee’s administration of the engagement of the independent auditor. The SEC’s rules establish two different approaches to pre-approving services, which the SEC considers to be equally valid. Proposed services either: may be pre-approved without consideration of specific case-by-case services by the Audit Committee (“general pre-approval”); or require the specific pre-approval of the Audit Committee or its delegate (“specific pre-approval”). The Audit Committee believes that the combination of these two approaches in this Policy will result in an effective and efficient procedure to pre-approve services performed by the Independent Auditors. As set forth in this Policy, unless a type of service has received general pre-approval, it will require specific pre-approval by the Audit Committee (or by any member of the Audit Committee to which pre-approval authority has been delegated) if it is to be provided by the Independent Auditors. Any proposed services exceeding pre-approved cost levels or budgeted amounts will also require specific pre-approval by the Audit Committee.

The appendices to this Policy describe the Audit, Audit-related, Tax and All Other services that have the general pre-approval of the Audit Committee. The term of any general pre-approval is 12 months from the date of pre-approval, unless the Audit Committee considers and provides a different period and states otherwise. The Audit Committee will annually review and pre-approve the services that may be provided by the Independent Auditors without obtaining specific pre-approval from the Audit Committee. The Audit Committee will add to or subtract from the list of general pre-approved services from time to time, based on subsequent determinations.

¹ This Audit Committee Audit and Non-Audit Services Pre-Approval Policy and Procedures (the “Policy”), adopted as of the date above, supersedes and replaces all prior versions that may have been adopted from time to time.

4

The purpose of this Policy is to set forth the policy and procedures by which the Audit Committee intends to fulfill its responsibilities. It does not delegate the Audit Committee’s responsibilities to pre-approve services performed by the Independent Auditors to management.

The Fund’s Independent Auditors have reviewed this Policy and believes that implementation of the Policy will not adversely affect the Independent Auditors’ independence.

     2. Delegation

As provided in the Act and the SEC’s rules, the Audit Committee may delegate either type of pre-approval authority to one or more of its members. The member to whom such authority is delegated must report, for informational purposes only, any pre-approval decisions to the Audit Committee at its next scheduled meeting.

     3. Audit Services

The annual Audit services engagement terms and fees are subject to the specific pre-approval of the Audit Committee. Audit services include the annual financial statement audit and other procedures required to be performed by the Independent Auditors to be able to form an opinion on the Fund’s financial statements. These other procedures include information systems and procedural reviews and testing performed in order to understand and place reliance on the systems of internal control, and consultations relating to the audit. The Audit Committee will approve, if necessary, any changes in terms, conditions and fees resulting from changes in audit scope, Fund structure or other items.

In addition to the annual Audit services engagement approved by the Audit Committee, the Audit Committee may grant general pre-approval to other Audit services, which are those services that only the Independent Auditors reasonably can provide. Other Audit services may include statutory audits and services associated with SEC registration statements (on Forms N-1A, N-2, N-3, N-4, etc.), periodic reports and other documents filed with the SEC or other documents issued in connection with securities offerings.

The Audit Committee has pre-approved the Audit services in Appendix B.1. All other Audit services not listed in Appendix B.1 must be specifically pre-approved by the Audit Committee (or by any member of the Audit Committee to which pre-approval has been delegated).

     4. Audit-related Services

Audit-related services are assurance and related services that are reasonably related to the performance of the audit or review of the Fund’s financial statements and, to the extent they are Covered Services, the Covered Entities or that are traditionally performed by the Independent Auditors. Because the Audit Committee believes that the provision of Audit-related services does not impair the independence of the auditor and is consistent with the SEC’s rules on auditor independence, the Audit Committee may grant general pre-approval to Audit-related services. Audit-related services include, among others, accounting consultations related to accounting, financial reporting or disclosure matters

5

not classified as “Audit services”; assistance with understanding and implementing new accounting and financial reporting guidance from rulemaking authorities; agreed-upon or expanded audit procedures related to accounting and/or billing records required to respond to or comply with financial, accounting or regulatory reporting matters; and assistance with internal control reporting requirements under Forms N-SAR and/or N-CSR.

The Audit Committee has pre-approved the Audit-related services in Appendix B.2. All other Audit-related services not listed in Appendix B.2 must be specifically pre-approved by the Audit Committee (or by any member of the Audit Committee to which pre-approval has been delegated).

     5. Tax Services

The Audit Committee believes that the Independent Auditors can provide Tax services to the Fund and, to the extent they are Covered Services, the Covered Entities, such as tax compliance, tax planning and tax advice without impairing the auditor’s independence, and the SEC has stated that the Independent Auditors may provide such services.

Pursuant to the preceding paragraph, the Audit Committee has pre-approved the Tax Services in Appendix B.3. All Tax services in Appendix B.3 must be specifically pre-approved by the Audit Committee (or by any member of the Audit Committee to which pre-approval has been delegated).

     6. All Other Services

The Audit Committee believes, based on the SEC’s rules prohibiting the Independent Auditors from providing specific non-audit services, that other types of non-audit services are permitted. Accordingly, the Audit Committee believes it may grant general pre-approval to those permissible non-audit services classified as All Other services that it believes are routine and recurring services, would not impair the independence of the auditor and are consistent with the SEC’s rules on auditor independence.

The Audit Committee has pre-approved the All Other services in Appendix B.4. Permissible All Other services not listed in Appendix B.4 must be specifically pre-approved by the Audit Committee (or by any member of the Audit Committee to which pre-approval has been delegated).

     7. Pre-Approval Fee Levels or Budgeted Amounts

Pre-approval fee levels or budgeted amounts for all services to be provided by the Independent Auditors will be established annually by the Audit Committee. Any proposed services exceeding these levels or amounts will require specific pre-approval by the Audit Committee. The Audit Committee is mindful of the overall relationship of fees for audit and non-audit services in determining whether to pre-approve any such services.

     8. Procedures

All requests or applications for services to be provided by the Independent Auditors that do not require specific approval by the Audit Committee will be submitted to the Fund’s Chief Financial Officer and must include a detailed description of the services to be

6

rendered. The Fund’s Chief Financial Officer will determine whether such services are included within the list of services that have received the general pre-approval of the Audit Committee. The Audit Committee will be informed on a timely basis of any such services rendered by the Independent Auditors. Requests or applications to provide services that require specific approval by the Audit Committee will be submitted to the Audit Committee by both the Independent Auditors and the Fund’s Chief Financial Officer, and must include a joint statement as to whether, in their view, the request or application is consistent with the SEC’s rules on auditor independence.

The Audit Committee has designated the Fund’s Chief Financial Officer to monitor the performance of all services provided by the Independent Auditors and to determine whether such services are in compliance with this Policy. The Fund’s Chief Financial Officer will report to the Audit Committee on a periodic basis on the results of its monitoring. Both the Fund’s Chief Financial Officer and management will immediately report to the chairman of the Audit Committee any breach of this Policy that comes to the attention of the Fund’s Chief Financial Officer or any member of management.

     9. Additional Requirements

The Audit Committee has determined to take additional measures on an annual basis to meet its responsibility to oversee the work of the Independent Auditors and to assure the auditor’s independence from the Fund, such as reviewing a formal written statement from the Independent Auditors delineating all relationships between the Independent Auditors and the Fund, consistent with Independence Standards Board No. 1, and discussing with the Independent Auditors its methods and procedures for ensuring independence.

     10. Covered Entities

Covered Entities include the Fund’s investment adviser(s) and any entity controlling, controlled by or under common control with the Fund’s investment adviser(s) that provides ongoing services to the Fund(s). Beginning with non-audit service contracts entered into on or after May 6, 2003, the Fund’s audit committee must pre-approve non-audit services provided not only to the Fund but also to the Covered Entities if the engagements relate directly to the operations and financial reporting of the Fund. This list of Covered Entities would include:

Morgan Stanley Retail Funds
Morgan Stanley Investment Advisors Inc.
Morgan Stanley & Co. Incorporated
Morgan Stanley DW Inc.
Morgan Stanley Investment Management Inc.
Morgan Stanley Investment Management Limited
Morgan Stanley Investment Management Private Limited
Morgan Stanley Asset & Investment Trust Management Co., Limited
Morgan Stanley Investment Management Company
Van Kampen Asset Management
Morgan Stanley Services Company, Inc.
Morgan Stanley Distributors Inc.
Morgan Stanley Trust FSB

7

Morgan Stanley Institutional Funds
Morgan Stanley Investment Management Inc.
Morgan Stanley Investment Advisors Inc.
Morgan Stanley Investment Management Limited
Morgan Stanley Investment Management Private Limited
Morgan Stanley Asset & Investment Trust Management Co., Limited
Morgan Stanley Investment Management Company
Morgan Stanley & Co. Incorporated
Morgan Stanley Distribution, Inc.
Morgan Stanley AIP GP LP
Morgan Stanley Alternative Investment Partners LP

(e)(2) Beginning with non-audit service contracts entered into on or after May 6, 2003, the audit committee also is required to pre-approve services to Covered Entities to the extent that the services are determined to have a direct impact on the operations or financial reporting of the Registrant. 100% of such services were pre-approved by the audit committee pursuant to the Audit Committee’s pre-approval policies and procedures (attached hereto).

(f) Not applicable.

(g) See table above.

(h) The audit committee of the Board of Trustees has considered whether the provision of services other than audit services performed by the auditors to the Registrant and Covered Entities is compatible with maintaining the auditors’ independence in performing audit services.

Item 5. Audit Committee of Listed Registrants.

(a) The Fund has a separately-designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Exchange Act whose members are: Joseph Kearns, Michael Nugent and Allen Reed.

(b) Not applicable.

Item 6. Schedule of Investments

(a) Refer to Item 1.

(b) Not applicable.

8

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

Applicable only to reports filed by closed-end funds.

Item 8. Portfolio Managers of Closed-End Management Investment Companies

Applicable only to reports filed by closed-end funds.

Item 9. Closed-End Fund Repurchases

Applicable only to reports filed by closed-end funds.

Item 10. Submission of Matters to a Vote of Security Holders

Not applicable.

Item 11. Controls and Procedures

(a) The Fund’s principal executive officer and principal financial officer have concluded that the Fund’s disclosure controls and procedures are sufficient to ensure that information required to be disclosed by the Fund in this Form N-CSR was recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, based upon such officers’ evaluation of these controls and procedures as of a date within 90 days of the filing date of the report.

(b) There were no changes in the registrant’s internal control over financial reporting that
occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

Item 12. Exhibits

(a) The Code of Ethics for Principal Executive and Senior Financial Officers is attached hereto.

(b) A separate certification for each principal executive officer and principal financial officer of the registrant are attached hereto as part of EX-99.CERT.

9

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.

Morgan Stanley Technology Fund

/s/ Randy TakianRandy Takian

Principal Executive Officer

May 21, 2009

          Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

/s/ Randy TakianRandy Takian

Principal Executive Officer

May 21, 2009

/s/ Francis SmithFrancis Smith

Principal Financial Officer

May 21, 2009

10