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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 811-01605
Pioneer Balanced Fund
(Exact name of registrant as specified in charter)
60 State Street, Boston, MA 02109
(Address of principal executive offices) (ZIP code)
Dorothy E. Bourassa, Pioneer Investment Management, Inc.,
60 State Street, Boston, MA 02109
(Name and address of agent for service)
Registrant's telephone number, including area code: (617) 742-7825
Date of fiscal year end: December 31
Date of reporting period: January 1, 2006 through June 30, 2006
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO SHAREOWNERS.
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PIONEER
-------
BALANCED
FUND
Semiannual
Report
6/30/06
[LOGO] PIONEER
Investments(R)
Table of Contents
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Letter to Shareowners 2
Portfolio Management Discussion 4
Portfolio Summary 9
Prices and Distributions 10
Performance Update 11
Comparing Ongoing Fund Expenses 15
Schedule of Investments 17
Financial Statements 32
Notes to Financial Statements 40
Trustees, Officers and Service Providers 49
President's
Dear Shareowner,
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We know from the history of the capital markets that sudden shifts in investor
sentiment can occur with little warning, based on an assortment of events. We
believe such a shift in sentiment is occurring in reaction to the possibility
that U.S. economic growth may slow in the second half of 2006.
While U.S. markets fell in late May and early June, the economic events of the
six- and 12-month periods ending June 30, 2006, have actually been
characterized by continued low inflation at home and strong growth prospects
abroad with rising commodity and stock prices.
According to the International Monetary Fund, international economic growth in
2004-5 was the fastest of any two-year period in more than 30 years, and 2006
growth is projected to match the healthy growth of 2005. The growth has been
broad-based, with Europe, Japan, and emerging market economies all showing
strength. The result has been rising prices across a broad range of
commodities, increasing corporate profits, and higher interest rates.
The U.S. bond markets' concern has been that strong economic growth would spark
inflation - we have already seen commodity prices rise, and U.S. labor costs
are threatening to increase, since we are close to full employment. That may
also be a reason why public sentiment is becoming uneasy.
Despite strong first quarter economic growth, the U.S. economy for the second
half of the year may slow in reaction to past increases in interest rates and
energy costs. Thus far the only sign of such a slowdown has been a cooling
housing market. Yet many observers believe a slower growing economy could be
welcomed by the markets.
The U.S. Federal Reserve has continued its program of measured short-term
interest rate increases. However, the Fed Chairman, Ben Bernanke, indicated
that inflation may moderate, which would permit the Fed to stop raising
interest rates. Such action could have positive effects for both consumers and
investors over the intermediate-to-longer term. By restraining inflation, the
Fed may also limit upward
2
Letter
pressure on longer-maturity bond yields and downward pressure on stocks'
price/earnings ratios.
In summary, we think security market valuations remain reasonable, and yet
there are no guarantees in investing. The unpredictability reinforces the
importance of Pioneer's message that investors should remain diversified, take
a long-term view, and base investment decisions on economic and market
fundamentals, rather than on emotion. Our investment philosophy and approach
continue to be based on the use of fundamental research to identify a range of
opportunities that offer an attractive balance of risk and reward to help
shareowners work toward their long-term goals.
Respectfully,
/s/ Osbert M. Hood
Osbert M. Hood,
President
Pioneer Investment Management, Inc.
Any information in this shareholder report regarding market or economic trends
or the factors influencing the Fund's historical or future performance are
statements of the opinion of Fund management as of the date of this report.
These statements should not be relied upon for any other purposes. Past
performance is no guarantee of future results, and there is no guarantee that
market forecasts discussed will be realized.
3
Pioneer Balanced Fund
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PORTFOLIO MANAGEMENT DISCUSSION 6/30/06
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The economy grew at a healthy pace during the first six months of 2006,
although some early signs emerged to indicate that the rate of economic growth
might be slowing. Stocks generally delivered modest returns over the six
months, despite slumping in May and June on worries that the Federal Reserve
might raise interest rates further than had been anticipated and hold back
economic growth. Small- and mid-cap stocks continued to outperform large-caps,
and benchmarks for value stocks recorded higher gains than growth stock
indices. In the fixed income market, interest rates across the yield curve -
among securities of all maturities - rose, and bond prices generally declined.
Shorter-duration strategies tended to produce better returns than long-duration
strategies, especially in high-grade securities. High-yield, below-investment
grade bonds outperformed higher-quality securities early in the year, but
slumped along with stocks in the final two months.
In the following interview, Timothy Mulrenan, who is responsible for the equity
portfolio of Pioneer Balanced Fund, and Richard Schlanger, who is responsible
for the Fund's fixed-income portfolio, discuss the factors that influenced the
Fund's performance over the six months ended June 30, 2006.
Q: How did the Fund perform during the first half of 2006?
A: Pioneer Balanced Fund, Class A shares, had flat returns during the six
months ending June 30, 2006, with a total return of 0.00%, at net asset
value. Over the same time period, the S&P 500 Index and the Lehman
Brothers Aggregate Bond Index returned 2.71% and -0.72%, respectively.
During the same six months, the average return of 577 funds in Lipper's
Mixed-Asset Target Allocation Growth Fund category was 2.38%.
Call 1-800-225-6292 or visit www.pioneerinvestments.com for the most
recent month-end performance results. Current performance may be lower or
higher than the performance data quoted.
The performance data quoted represents past performance, which is no
guarantee of future results. Investment return and principal value will
fluctuate, and shares, when redeemed, may be worth more or less than their
original cost.
4
Pioneer Balanced Fund
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Q: What were the Fund's principal investment strategies during the six months?
A: We maintained a slight overweighting in equities, which comprised about 63%
of assets on June 30, 2006, compared to a typical allocation of 60%.
Within the equity portfolio, we maintained our focus on large-cap
companies that have experienced consistent growth. This emphasis, however,
did not help performance as value stocks and small-company stocks
outperformed the stable growth companies that we believed offered the most
attractive relative values.
We made no major sector changes among our equity investments, although we
modestly reduced our overweight in energy companies. While we still are
impressed by the long-term prospects for the energy sector, we thought
near-term growth may begin to slow. We were overweighted in consumer
staples and, to a lesser extent, in information technology and health
care. We were underweighted in financials, especially banks, because of
the vulnerability of their earnings margins as the difference between
interest rates of short-term and long-term securities flattens. Moreover,
we believe some banks may need to add to their reserves against loan
losses.
We added to our information technology positions when we invested in
Corning, a leader in producing flat-screen panels for televisions and
computer monitors. In media, we sold shares of CBS because of concerns
that growth in traditional media would slow. At the same time, we invested
in cable company Comcast. We also reduced our position in the U.K.-based
Vodafone, a major telecommunications service provider, because of our
concerns about competitive pressure in Europe.
We made no significant changes in our fixed income strategy during the six
months, although duration - or sensitivity to interest rate changes -
increased somewhat, partly because of the natural lengthening of duration
in mortgage securities as mortgage prepayment rates declined. The
portfolio's duration was 4.75 years on June 30, 2006, compared to 4.55
years six months earlier. We invested opportunistically, buying bonds of
Sevan Marine, a Norwegian oil field services company, partly because we
favored the prospects of the Norwegian currency, the Krone. We also
invested in collateralized mortgage obligations. As we did this, we sold
5
Pioneer Balanced Fund
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PORTFOLIO MANAGEMENT DISCUSSION 6/30/06 (continued)
- --------------------------------------------------------------------------------
bonds of Bausch & Lomb, the eye products company, and of Sunsage, a Korean
auto parts company. We also slightly upgraded the overall credit quality
of the portfolio. On June 30, the portfolio's average credit quality was
AA-, with 71.4% of fixed income assets invested in AAA or the equivalent,
while just 8.8% of fixed income assets were invested in high-yield
corporates.
Q: What types of equity investments most influenced performance?
A: Among our stock positions, pharmacy chain CVS was a particularly strong
performer. The company's sales and profit growth exceeded expectations as
the company continued to execute its strategy of buying underperforming
assets and increasing their profitability. Cable company Comcast, in which
we invested when its stock price was low, succeeded in taking more market
share of household expenditures by offering television, Internet and
telephone service.
Several information technology investments also helped, including Cisco,
Hewlett-Packard and First Data, all of which gained while other tech
stocks were declining. The Fund's performance was helped because we had
very limited exposure to the poor-performing semiconductor industry.
Several health care investments held back results, including biotechnology
leader Amgen and generic pharmaceutical manufacturer Teva. Investors were
concerned about a patent dispute over rights to an anemia drug in which
Amgen is involved, while Teva declined after reporting disappointing
earnings. We retained both positions as of June 30, 2006. Also detracting
from performance was Wrigley, which lowered its earnings forecasts because
of investments in new marketing initiatives. We also continued to hold the
position in Wrigley, which we believe has a very attractive franchise.
Shares of Microsoft declined as the company reduced its earnings forecast
due to an increase in investment spending on new marketing and R&D
initiatives. Despite the near-term disappointment, we believe that the
flow of new products at Microsoft, supported by increased spending, will
help drive healthy long-term profit growth.
Media giant Viacom performed poorly as cable network advertising sales, in
both the U.S. and Europe, softened in recent months. We still view the
company as holding some of the highest quality
6
Pioneer Balanced Fund
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- --------------------------------------------------------------------------------
cable network assets and believe the company may deliver above-average
long-term growth and profitability.
Q: What types of fixed income investments most influenced performance?
A: Our relatively short maturity helped in a rising interest rate environment,
as did the quality emphasis. In addition, our overweights in mortgage
securities helped support results during the period.
Holding back results were our positions in some long-duration assets,
which were vulnerable to price losses as long-term interest rates rose. We
had no major credit problems.
Q: What is your investment outlook?
A: We anticipate that economic growth will slow in the coming months. The U.S.
Federal Reserve Board probably is near the end of its cycle of
interest-rate hikes, but other major central banks may continue to raise
rates. One consequence could be a further weakening of the U.S. dollar
versus other currencies. One positive for fixed income markets is that
there still is a lot of liquidity in world markets, which should guard
against any dramatic increase in long-term interest rates. Returns of
between 5% and 5 1/2% are still very attractive to foreign investors.
We expect continued volatility in the domestic equity market over the next
several months against a backdrop of a slowing economy, high energy
prices, high interest rates and the current slowdown in residential real
estate. As a consequence, we believe investors' expectations for corporate
profit growth will probably soften. Offsetting these negative influences,
however, is the widespread expectation that the Federal Reserve will stop
raising interest rates soon. In addition, stock price increases over the
past two years have not kept pace with increases in profits. As a
consequence, current stock prices, as reflected in price/earnings ratios,
are reasonable and provide some downside protection in a volatile
environment. The stock market over the past two years has not
distinguished between cyclical profits and consistent profits. As a
result, we believe that higher-quality growth stocks of companies with
good earnings, high returns on equity and high reinvestment rates should
perform well. These companies, which we have been emphasizing, are trading
at valuations that we do not believe reflect their potential values.
7
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
PORTFOLIO MANAGEMENT DISCUSSION 6/30/06 (continued)
- --------------------------------------------------------------------------------
When interest rates rise, the prices of fixed income securities in the
Fund will generally fall. Conversely, when interest rates fall, the prices
of fixed income securities in the Fund will generally rise. Investments in
the Fund are subject to possible loss due to the financial failure of
underlying securities and their inability to meet their debt obligations.
Prepayment risk is the chance that mortgage-backed bonds will be paid off
early if falling interest rates prompt homeowners to refinance their
mortgages. Forced to reinvest the unanticipated proceeds at lower interest
rates, the Fund would experience a decline in income and lose the
opportunity for additional price appreciation associated with falling
interest rates.
Investing in foreign and/or emerging markets securities involves risks
relating to interest rates, currency exchange rates, economic, and
political conditions.
The Fund may invest in mortgage-backed securities, which during times of
fluctuating interest rates may increase or decrease more than other
fixed-income securities. Mortgage-Backed securities are also subject to
pre-payments. At times, the Fund's investments may represent industries or
industry sectors that are interrelated or have common risks, making it
more susceptible to any economic, political, or regulatory developments or
other risks affecting those industries and sectors.
Any information in this shareholder report regarding market or economic
trends or the factors influencing the Fund's historical or future
performance are statements of the opinion of Fund management as of the
date of this report. These opinions should not be relied upon for any
other purposes. Past performance is no guarantee of future results, and
there is no guarantee that market forecasts discussed will be realized.
8
Pioneer Balanced Fund
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PORTFOLIO SUMMARY 6/30/06
- --------------------------------------------------------------------------------
Portfolio Diversification
- --------------------------------------------------------------------------------
(As a percentage of total investment portfolio)
[The following data was represented as a pie chart in the printed material]
U.S. Common Stocks 60.2%
U.S. Government Securities 23.5%
U.S. Corporate Bonds 9.4%
Temporary Cash Investment 3.4%
Depositary Receipts for International Stocks 1.3%
Asset Backed Securities 1.0%
Collateralized Mortgage Obligations 1.2%
Sector Diversification
- --------------------------------------------------------------------------------
(As a percentage of total long-term securities)
[The following data was represented as a pie chart in the printed material]
U.S. Government Agency Obligations 25.0%
Financials 14.6%
Information Technology 11.9%
Consumer Staples 11.0%
Health Care 8.9%
Consumer Discretionary 8.3%
Industrials 7.9%
Energy 6.1%
Materials 5.0%
Telecommunication Services 0.8%
Utilities 0.5%
10 Largest Holdings
- --------------------------------------------------------------------------------
(As a percentage of long-term securities)*
1. Berkshire Hathaway, Inc. (Class B) 3.42%
2. CVS Corp. 3.38
3. First Data Corp. 3.35
4. PepsiCo, Inc. 3.33
5. Microsoft Corp. 3.22
6. Northrop Grumman Corp. 2.70
7. Praxair, Inc. 2.45
8. United Parcel Service 2.43
9. Comcast Corp. 2.13
10. National-Oilwell Varco, Inc. 2.00
* This list excludes temporary cash and derivative instruments. Portfolio
holdings will vary for other periods.
9
Pioneer Balanced Fund
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PRICES AND DISTRIBUTIONS
- --------------------------------------------------------------------------------
Net Asset Value Per Share
- --------------------------------------------------------------------------------
Class 6/30/06 12/31/05
- ------------ --------- ---------
A $9.82 $9.89
B $9.70 $9.77
C $9.78 $9.85
Investor $9.82 $9.90
Distributions Per Share
- --------------------------------------------------------------------------------
1/1/06 - 6/30/06
-------------------------------------------
Net
Investment Short-Term Long-Term
Class Income Capital Gains Capital Gains
- ------------ ------------ --------------- --------------
A $0.7000 $ - $ -
B $0.0300 $ - $ -
C $0.0300 $ - $ -
Investor $0.0900 $ - $ -
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INDEX DEFINITIONS
- --------------------------------------------------------------------------------
The Standard & Poor's 500 Stock Index (the S&P 500) is a commonly used
measure of the broad U.S. stock market. The Lehman Brothers Aggregate Bond
Index is a measure of the U.S. bond market. Index returns assume
reinvestment of dividends and, unlike Fund returns, do not reflect any
fees, expenses or sales charges. You cannot invest directly in the Indexes.
The indexes defined here pertain to the "Value of $10,000 Investment"
charts on pages 11-14.
10
Pioneer Balanced Fund
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PERFORMANCE UPDATE 6/30/06 CLASS A SHARES
- --------------------------------------------------------------------------------
Investment Returns
-----------------------------------------------------------------------------
The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Balanced Fund at public offering price, compared
to that of the Standard & Poor's 500 Index and the Lehman Brothers
Aggregate Bond Index.
- --------------------------------------------------------
Average Annual Total Returns
(As of June 30, 2006)
Net Asset Public Offering
Period Value (NAV) Price (POP)
10 Years 3.93% 3.45%
5 Years 1.46 0.54
1 Year 3.67 -0.97
- --------------------------------------------------------
[The following data was represented as a mountain chart in the printed material]
Pioneer Lehman Brothers
Balanced Aggregate Standard & Poor's
Fund Bond Index 500 Index
---- ---------- ---------
6/96 9,550 10,000 10,000
11,053 10,815 13,468
6/98 12,448 11,955 17,532
12,380 12,331 21,520
6/00 12,617 12,894 23,081
13,057 14,342 19,660
6/02 11,679 15,579 16,126
12,193 17,200 16,165
6/04 13,231 17,255 19,253
13,545 18,428 20,469
6/06 14,042 18,280 22,234
Call 1-800-225-6292 or visit www.pioneerinvestments.com for the most recent
month-end performance results. Current performance may be lower or higher
than the performance data quoted.
The performance data quoted represents past performance, which is no
guarantee of future results. Investment return and principal value will
fluctuate, and shares, when redeemed, may be worth more or less than their
original cost.
NAV results represent the percent change in net asset value per share.
Returns would have been lower had sales charges been reflected. POP returns
reflect deduction of maximum 4.50% sales charge. All results are historical
and assume the reinvestment of dividends and capital gains. Other share
classes are available for which performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during
the periods shown. Without such waivers Fund performance would be lower.
Waivers may not be in effect for all funds. Certain fee waivers are
contractual through a specified period. Otherwise, fee waivers can be
rescinded at any time. See the prospectus and financial statements for more
information.
The performance table and graph do not reflect the deduction of fees and
taxes that a shareowner would pay on Fund distributions or the redemption
of Fund shares.
The Fund adopted its current name and investment objective on February 3,
1997. Prior to that date, the Fund's name was Pioneer Income Fund and its
objective was income from a portfolio of income-producing bonds and stocks.
11
Pioneer Balanced Fund
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PERFORMANCE UPDATE 6/30/06 CLASS B SHARES
- --------------------------------------------------------------------------------
Investment Returns
-----------------------------------------------------------------------------
The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Balanced Fund, compared to that of the Standard
& Poor's 500 Index and the Lehman Brothers Aggregate Bond Index.
- --------------------------------------------------------
Average Annual Total Returns
(As of June 30, 2006)
If If
Period Held Redeemed
10 Years 2.98% 2.98%
5 Years 0.54 0.54
1 Year 2.73 -1.27
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[The following data was represented as a mountain chart in the printed material]
Pioneer Lehman Brothers
Balanced Aggregate Standard & Poor's
Fund Bond Index 500 Index
---- ---------- ---------
6/96 10,000 10,000 10,000
11,472 10,815 13,468
6/98 12,800 11,955 17,532
12,609 12,331 21,520
6/00 12,740 12,894 23,081
13,060 14,342 19,660
6/02 11,581 15,579 16,126
11,986 17,200 16,165
6/04 12,874 17,255 19,253
13,057 18,428 20,469
6/06 13,414 18,280 22,234
Call 1-800-225-6292 or visit www.pioneerinvestments.com for the most recent
month-end performance results. Current performance may be lower or higher
than the performance data quoted.
The performance data quoted represents past performance, which is no
guarantee of future results. Investment return and principal value will
fluctuate, and shares, when redeemed, may be worth more or less than their
original cost.
"If Held" results represent the percent change in net asset value per
share. Returns would have been lower had sales charges been reflected. "If
Redeemed" returns reflect the deduction of applicable contingent deferred
sales charge (CDSC). Effective December 1, 2004, the period during which a
CDSC is applied to withdrawals was shortened to 5 years. The maximum CDSC
for Class B shares continues to be 4%. For more complete information,
please see the prospectus for details. Note: Shares purchased prior to
December 1, 2004 remain subject to the CDSC in effect at the time you
purchased those shares. For performance information for shares purchased
prior to December 1, 2004, please visit www.pioneerinvestments.com/bshares.
All results are historical and assume the reinvestment of dividends and
capital gains. Other share classes are available for which performance and
expenses will differ.
Performance results reflect any applicable expense waivers in effect during
the periods shown. Without such waivers Fund performance would be lower.
Waivers may not be in effect for all funds. Certain fee waivers are
contractual through a specified period. Otherwise, fee waivers can be
rescinded at any time. See the prospectus and financial statements for more
information.
The performance table and graph do not reflect the deduction of fees and
taxes that a shareowner would pay on Fund distributions or the redemption
of Fund shares.
The Fund adopted its current name and investment objective on February 3,
1997. Prior to that date, the Fund's name was Pioneer Income Fund and its
objective was income from a portfolio of income-producing bonds and stocks.
12
Pioneer Balanced Fund
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PERFORMANCE UPDATE 6/30/06 CLASS C SHARES
- --------------------------------------------------------------------------------
Investment Returns
-----------------------------------------------------------------------------
The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Balanced Fund, compared to that of the Standard
& Poor's 500 Index and the Lehman Brothers Aggregate Bond Index.
- --------------------------------------------------------
Average Annual Total Returns
(As of June 30, 2006)
If If
Period Held Redeemed
Life-of-Class
(1/31/96) 2.95% 2.95%
5 Years 0.54 0.54
1 Year 2.83 2.83
- --------------------------------------------------------
[The following data was represented as a mountain chart in the printed material]
Pioneer Lehman Brothers
Balanced Aggregate Standard & Poor's
Fund Bond Index 500 Index
---- ---------- ---------
6/96 10,000 10,000 10,000
11,517 10,815 13,468
6/98 12,893 11,955 17,532
12,676 12,331 21,520
6/00 12,778 12,894 23,081
13,020 14,342 19,660
6/02 11,530 15,579 16,126
11,928 17,200 16,165
6/04 12,802 17,255 19,253
13,006 18,428 20,469
6/06 13,374 18,280 22,234
Call 1-800-225-6292 or visit www.pioneerinvestments.com for the most recent
month-end performance results. Current performance may be lower or higher
than the performance data quoted.
The performance data quoted represents past performance, which is no
guarantee of future results. Investment return and principal value will
fluctuate, and shares, when redeemed, may be worth more or less than their
original cost.
Class C shares held for less than one year are also subject to a 1%
contingent deferred sales charge (CDSC). The performance of Class C shares
does not reflect the 1% front-end sales charge in effect prior to February
1, 2004. If you paid a 1% sales charge, your returns would be lower than
those shown above. "If Held" results represent the percent change in net
asset value per share. Returns would have been lower had sales charges been
reflected. All results are historical and assume the reinvestment of
dividends and capital gains. Other share classes are available for which
performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during
the periods shown. Without such waivers Fund performance would be lower.
Waivers may not be in effect for all funds. Certain fee waivers are
contractual through a specified period. Otherwise, fee waivers can be
rescinded at any time. See the prospectus and financial statements for more
information.
The performance table and graph do not reflect the deduction of fees and
taxes that a shareowner would pay on Fund distributions or the redemption
of Fund shares.
The Fund adopted its current name and investment objective on February 3,
1997. Prior to that date, the Fund's name was Pioneer Income Fund and its
objective was income from a portfolio of income-producing bonds and stocks.
13
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
PERFORMANCE UPDATE 6/30/06 INVESTOR CLASS SHARES
- --------------------------------------------------------------------------------
Investment Returns
-----------------------------------------------------------------------------
The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Balanced Fund, compared to that of the Standard
& Poor's 500 Index and the Lehman Brothers Aggregate Bond Index.
- --------------------------------------------------------
Average Annual Total Returns
(As of June 30, 2006)
If If
Period Held Redeemed
Life-of-Class
(12/13/04) 2.79% 2.79%
1 Year 3.93 3.93
- --------------------------------------------------------
[The following data was represented as a mountain chart in the printed material]
Pioneer Lehman Brothers
Balanced Aggregate Standard & Poor's
Fund Bond Index 500 Index
---- ---------- ---------
12/04 10,000 10,000 10,000
6/05 9,980 10,251 9,919
6/06 10,372 10,169 10,774
Call 1-800-225-6292 or visit www.pioneerinvestments.com for the most recent
month-end performance results. Current performance may be lower or higher
than the performance data quoted.
The performance data quoted represents past performance, which is no
guarantee of future results. Investment return and principal value will
fluctuate, and shares, when redeemed, may be worth more or less than their
original cost.
Certain Pioneer funds (the "Funds") issued Investor Class shares in
connection with the reorganization of Safeco mutual funds. The Funds are
not offering additional Investor Class shares except in connection with the
reinvestment of dividends on the Funds' outstanding Investor Class shares.
All Investor Class shares of the Funds, whenever issued, convert to Class A
shares of their respective Funds on December 10, 2006. Investor Class
shares are not subject to sales charges.
Performance results reflect any applicable expense waivers in effect during
the periods shown. Without such waivers Fund performance would be lower.
Waivers may not be in effect for all funds. Certain fee waivers are
contractual through a specified period. Otherwise, fee waivers can be
rescinded at any time. See the prospectus and financial statements for more
information.
The performance table and graph do not reflect the deduction of fees and
taxes that a shareowner would pay on Fund distributions or the redemption
of Fund shares.
The Fund adopted its current name and investment objective on February 3,
1997. Prior to that date, the Fund's name was Pioneer Income Fund and its
objective was income from a portfolio of income-producing bonds and stocks.
14
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
COMPARING ONGOING FUND EXPENSES
- --------------------------------------------------------------------------------
As a shareowner in the Fund, you incur two types of costs:
(1) ongoing costs, including management fees, distribution and/or service
(12b-1) fees, and other Fund expenses; and
(2) transaction costs, including sales charges (loads) on purchase payments.
This example is intended to help you understand your ongoing expenses (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 at the beginning of the Fund's latest six-month period and held
throughout the six months.
Using the Tables
Actual Expenses
The first table below provides information about actual account values and
actual expenses. You may use the information in this table, together with the
amount you invested, to estimate the expenses that you paid over the period as
follows:
1. Divide your account value by $1,000
Example: an $8,600 account value [divided by] $1,000 = 8.6
2. Multiply the result in (1) above by the corresponding share class's number
in the third row under the heading entitled "Expenses Paid During Period"
to estimate the expenses you paid on your account during this period.
Expenses Paid on a $1,000 Investment in Pioneer Balanced Fund
Based on actual returns from January 1, 2006 through June 30, 2006
Share Class A B C Investor
- ------------------------------- ------------ ------------ ------------ ------------
Beginning Account Value $1,000.00 $1,000.00 $1,000.00 $1,000.00
On 1/01/06
Ending Account Value $1,000.00 $ 995.90 $ 995.90 $1,001.00
On 6/30/06
Expenses Paid During Period* $ 6.55 $ 11.23 $ 10.39 $ 5.46
* Expenses are equal to the Fund's annualized expense ratio of 1.32%, 2.27%,
2.10% and 1.10%, for Class A, Class B, Class C and Investor Class shares,
respectively, multiplied by the average account value over the period,
multiplied by 181/365 (to reflect the one-half year period).
15
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
COMPARING ONGOING FUND EXPENSES (continued)
- --------------------------------------------------------------------------------
Hypothetical Example for Comparison Purposes
The table below provides information about hypothetical account values and
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 costs 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 tables are meant to highlight your
ongoing costs only and do not reflect any transaction costs, such as sales
charges (loads) that are charged at the time of the transaction. Therefore, the
table below is useful in comparing ongoing costs only and will not help you
determine the relative total costs of owning different funds. In addition, if
these transaction costs were included, your costs would have been higher.
Expenses Paid on a $1,000 Investment in Pioneer Balanced Fund
Based on a hypothetical 5% return per year before expenses, reflecting the
period from January 1, 2006 through June 30, 2006
Share Class A B C Investor
- ------------------------------- ------------ ------------ ------------ ------------
Beginning Account Value $1,000.00 $1,000.00 $1,000.00 $1,000.00
On 1/01/06
Ending Account Value $1,018.25 $1,013.54 $1,014.38 $1,019.34
On 6/30/06
Expenses Paid During Period* $ 6.61 $ 11.33 $ 10.49 $ 5.51
* Expenses are equal to the Fund's annualized expense ratio of 1.32%, 2.27%,
2.10% and 1.10%, for Class A, Class B, Class C and Investor Class shares,
respectively, multiplied by the average account value over the period,
multiplied by 181/365 (to reflect the one-half year period).
16
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 6/30/06 (unaudited)
- --------------------------------------------------------------------------------
Shares Value
COMMON STOCKS - 63.2%
Energy - 5.3%
Integrated Oil & Gas - 1.1%
2,400 BP Amoco Plc (A.D.R.) $ 167,064
18,776 Exxon Mobil Corp. 1,151,908
-----------
$ 1,318,972
-----------
Oil & Gas Drilling - 1.4%
37,200 ENSCO International, Inc. $ 1,711,944
-----------
Oil & Gas Equipment & Services - 2.1%
37,188 National-Oilwell Varco, Inc.* $ 2,354,744
-----------
Oil & Gas Exploration & Production - 0.7%
16,400 Encana Corp. (b) $ 863,296
-----------
Total Energy $ 6,248,956
-----------
Materials - 3.7%
Gold - 1.3%
28,600 Newmont Mining Corp. (b) $ 1,513,798
-----------
Industrial Gases - 2.4%
53,500 Praxair, Inc. $ 2,889,000
-----------
Total Materials $ 4,402,798
-----------
Capital Goods - 4.5%
Aerospace & Defense - 2.6%
49,600 Northrop Grumman Corp. $ 3,177,376
-----------
Industrial Conglomerates - 1.9%
26,400 3M Co. $ 2,132,328
-----------
Total Capital Goods $ 5,309,704
-----------
Commercial Services & Supplies - 0.3%
Diversified Commercial Services - 0.3%
9,700 Cintas Corp.*(b) $ 385,672
-----------
Total Commercial Services & Supplies $ 385,672
-----------
Transportation - 2.4%
Air Freight & Couriers - 2.4%
34,700 United Parcel Service $ 2,856,851
-----------
Total Transportation $ 2,856,851
-----------
The accompanying notes are an integral part of these financial statements. 17
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 6/30/06 (unaudited) (continued)
- --------------------------------------------------------------------------------
Shares Value
Consumer Durables & Apparel - 1.3%
Apparel, Accessories & Luxury Goods - 1.3%
42,800 Liz Claiborne, Inc. $ 1,586,168
-----------
Total Consumer Durables & Apparel $ 1,586,168
-----------
Media - 3.4%
Broadcasting & Cable TV - 2.1%
76,600 Comcast Corp.* $ 2,510,948
-----------
Movies & Entertainment - 1.3%
43,797 Viacom, Inc. (Class B) $ 1,569,684
-----------
Total Media $ 4,080,632
-----------
Retailing - 1.5%
Apparel Retail - 1.5%
61,900 Ross Stores, Inc. $ 1,736,295
-----------
Total Retailing $ 1,736,295
-----------
Food & Drug Retailing - 3.6%
Drug Retail - 3.4%
129,700 CVS Corp. $ 3,981,790
-----------
Food Distributors - 0.1%
3,400 Sysco Corp. $ 103,904
-----------
Hypermarkets & Supercenters - 0.1%
3,700 Wal-Mart Stores, Inc. $ 178,229
-----------
Total Food & Drug Retailing $ 4,263,923
-----------
Food, Beverage & Tobacco - 6.4%
Brewers - 0.6%
14,900 Anheuser-Busch Companies, Inc. (b) $ 679,291
-----------
Packaged Foods & Meats - 1.6%
41,000 William Wrigley Jr. Co. $ 1,859,760
-----------
Soft Drinks - 4.2%
24,800 Coca-Cola Co. $ 1,066,896
65,400 PepsiCo, Inc. 3,926,616
-----------
$ 4,993,512
-----------
Total Food, Beverage & Tobacco $ 7,532,563
-----------
18 The accompanying notes are an integral part of these financial statements.
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Shares Value
Household & Personal Products - 0.9%
Personal Products - 0.9%
27,200 Estee Lauder Co.* $ 1,051,824
------------
Total Household & Personal Products $ 1,051,824
------------
Health Care Equipment & Services - 2.1%
Health Care Distributors - 1.2%
21,100 Cardinal Health, Inc. $ 1,357,363
------------
Health Care Equipment - 0.8%
30,200 Biomet, Inc. $ 944,958
------------
Health Care Technology - 0.1%
5,100 IMS Health, Inc. $ 136,935
------------
Total Health Care Equipment & Services $ 2,439,256
------------
Pharmaceuticals & Biotechnology - 6.5%
Biotechnology - 1.9%
34,868 Amgen, Inc.* $ 2,274,440
------------
Pharmaceuticals - 4.6%
11,100 Eli Lilly & Co. $ 613,497
64,021 Pfizer, Inc. 1,502,573
31,616 Teva Pharmaceutical Industries, Ltd. (b) 998,750
51,500 Wyeth 2,287,115
------------
$ 5,401,935
------------
Total Pharmaceuticals & Biotechnology $ 7,676,375
------------
Banks - 0.3%
Diversified Banks - 0.3%
4,620 U.S. Bancorp $ 142,666
4,000 Wachovia Corp. 216,320
------------
$ 358,986
------------
Total Banks $ 358,986
------------
Diversified Financials - 5.1%
Asset Management & Custody Banks - 1.3%
47,900 The Bank of New York Co., Inc. $ 1,542,380
------------
Consumer Finance - 1.7%
38,900 American Express Co. $ 2,070,258
------------
Investment Banking & Brokerage - 0.7%
9,400 Merrill Lynch & Co., Inc. $ 653,864
------------
The accompanying notes are an integral part of these financial statements. 19
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 6/30/06 (unaudited) (continued)
- --------------------------------------------------------------------------------
Shares Value
Diversified Financial Services - 1.4%
36,700 Bank of America Corp. $ 1,765,270
------------
Total Diversified Financials $ 6,031,772
------------
Insurance - 4.6%
Multi-Line Insurance - 0.2%
3,500 American International Group, Inc. $ 206,675
------------
Property & Casualty Insurance - 4.4%
1,325 Berkshire Hathaway, Inc. (Class B)* $ 4,031,975
47,200 Progressive Corp. 1,213,512
------------
$ 5,245,487
------------
Total Insurance $ 5,452,162
------------
Software & Services - 6.5%
Data Processing & Outsourced Services - 3.3%
87,500 First Data Corp. $ 3,941,000
------------
Systems Software - 3.2%
162,900 Microsoft Corp. $ 3,795,570
------------
Total Software & Services $ 7,736,570
------------
Technology Hardware & Equipment - 4.1%
Communications Equipment - 2.8%
67,600 Cisco Systems, Inc.* $ 1,320,228
29,300 Corning, Inc.* 708,767
33,400 Qualcomm, Inc. 1,338,338
------------
$ 3,367,333
------------
Computer Hardware - 1.3%
49,000 Hewlett-Packard Co. $ 1,552,320
------------
Total Technology Hardware & Equipment $ 4,919,653
------------
Semiconductors - 0.4%
15,000 Intel Corp. $ 284,250
9,000 Texas Instruments, Inc. 272,610
------------
$ 556,860
------------
Total Semiconductors $ 556,860
------------
Telecommunication Services - 0.3%
Wireless Telecommunication Services - 0.3%
18,200 Vodafone Group Plc (A.D.R.) $ 387,660
------------
Total Telecommunication Services $ 387,660
------------
20 The accompanying notes are an integral part of these financial statements.
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Shares Value
TOTAL COMMON STOCKS
(Cost $62,033,024) $75,014,680
-----------
RIGHTS/WARRANTS - 0.0%
Technology Hardware & Equipment - 0.0%
Communications Equipment - 0.0%
1,883 Lucent Technologies, Expires 12/10/07* $ 508
-----------
TOTAL RIGHTS/WARRANTS
(Cost $2,194) $ 508
-----------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
ASSET BACKED SECURITIES - 1.0%
Transportation - 0.0%
Airlines - 0.0%
$ 11,770 BBB+/Baa3 Continental Airlines, 6.648%, 9/15/17 $ 11,704
------------
Total Transportation $ 11,704
------------
Diversified Financials - 0.6%
Diversified Financial Services - 0.6%
210,107 BB-/Ba2 Caithness Coso Fund Corp., 6.263%, 6/15/14
(144A) $ 205,779
217,871 BBB-/Baa2 PF Export Receivable Master Trust, 6.436%,
6/1/15 (144A) 217,834
251,696 BBB/Baa2 Power Receivables Finance, 6.29%, 1/1/12 (144A) 250,732
------------
$ 674,345
------------
Specialized Finance - 0.0%
70,000 AAA/Aaa MBNA Credit Card Master Note, Floating Rate
Note, 12/15/08 $ 69,990
------------
Total Diversified Financials $ 744,335
------------
Utilities - 0.4%
Electric Utilities - 0.4%
272,580 BBB-/Baa3 FPL Energy America Wind LLC, 6.639%,
6/20/23 (144A) $ 278,623
158,400 BB-/Ba2 FPL Energy Wind Funding, 6.876%,
6/27/17 (144A) 158,202
------------
$ 436,825
------------
Total Utilities $ 436,825
------------
TOTAL ASSET BACKED SECURITIES
(Cost $1,199,073) $ 1,192,864
------------
The accompanying notes are an integral part of these financial statements. 21
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 6/30/06 (unaudited) (continued)
- --------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
COLLATERALIZED MORTGAGE OBLIGATIONS - 1.2%
Diversified Financials - 0.1%
Diversified Financial Services - 0.1%
$ 60,000 NR/Ba1 Global Signal, 7.036%, 2/15/36 (144A) $ 59,918
------------
Total Diversified Financials $ 59,918
------------
Government - 1.1%
500,000 AAA/Aaa Fannie Mae, 6.0%, 6/25/16 $ 498,281
145,205 NR/NR Federal Home Loan Bank, 5.0%, 1/15/16 143,211
295,508 AAA/Aaa Federal Home Loan Mortgage Corp., 5.875%,
5/15/16 294,517
437,425 AAA/Aaa Freddie Mac, 6.1%, 9/15/18 435,832
------------
$ 1,371,841
------------
Total Government $ 1,371,841
------------
TOTAL COLLATERALIZED MORTGAGE
OBLIGATIONS
(Cost $1,443,610) $ 1,431,759
------------
CORPORATE BONDS - 9.7%
Energy - 0.8%
Integrated Oil & Gas - 0.1%
120,000 A-/A3 Occidental Petroleum, 6.75%, 1/15/12 $ 126,262
25,000 BBB/Baa2 Petro-Canada, 4.0%, 7/15/13 22,116
15,000 BBB+/Baa1 USX Corp., 6.85%, 3/1/08 15,275
------------
$ 163,653
------------
Oil & Gas Equipment & Services - 0.1%
1,000,000 NR/NR Sevan Marine, 9.0%, 3/31/08 $ 165,776
------------
Oil & Gas Exploration & Production - 0.3%
300,000 BBB/NR Gazprom International SA, 7.201%,
2/1/20 (144A) $ 304,125
65,000 BBB/Baa1 Pemex Project Funding Master, 9.125%,
10/13/10 71,175
------------
$ 375,300
------------
Oil & Gas Refining & Marketing - 0.2%
65,000 BBB/Baa2 Boardwalk Pipelines LLC, 5.5%, 2/1/17 $ 61,315
100,000 BB-/Ba2 Semco Energy, Inc., 7.125%, 5/15/08 99,286
------------
$ 160,601
------------
Oil & Gas Storage & Transportation - 0.1%
40,000 BBB+/Baa1 Kinder Morgan Energy Partners, 6.75%, 3/15/11 $ 40,863
------------
Total Energy $ 906,193
------------
22 The accompanying notes are an integral part of these financial statements.
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
Materials - 1.2%
Aluminum - 0.1%
$ 150,000 B/B1 Novelis, Inc., 7.25%, 2/15/15 $ 144,000
------------
Commodity Chemicals - 0.2%
300,000 BB-/Ba2 Nova Chemicals, Ltd., 6.5%, 1/15/12 $ 276,000
------------
Diversified Metals & Mining - 0.4%
425,000 BBB-/Baa3 Inco, Ltd., 7.2%, 9/15/32 $ 435,078
------------
Fertilizers & Agricultural Chemicals - 0.0%
30,000 BBB+/Baa1 Potash Corp., Saskatchewan, 4.875%, 3/1/13 $ 28,217
------------
Metal & Glass Containers - 0.1%
125,000 BBB/Baa2 Tenneco Packaging, 8.125%, 6/15/17 $ 137,972
------------
Paper Products - 0.4%
150,000 B+/B1 Abitibi-Consolidated, Inc., 6.95%, 4/1/08 145,313
300,000 B-/B3 MDP Acquisition, 9.625%, 10/1/12 309,000
------------
$ 454,313
------------
Total Materials $ 1,475,580
------------
Capital Goods - 0.6%
Aerospace & Defense - 0.1%
25,000 A/A2 Boeing Co., 5.125%, 2/15/13 $ 24,119
80,000 A/A2 Honeywell International, 7.5%, 3/1/10 84,770
------------
$ 108,889
------------
Electrical Component & Equipment - 0.1%
85,000 NR/WD Orcal Geothermal, 6.21%, 12/30/20 (144A) $ 82,750
------------
Industrial Conglomerates - 0.2%
145,000 AAA/Aaa General Electric Capital Corp., 6.125%, 2/22/11 $ 147,725
90,000 AAA/Aaa General Electric Capital Corp., 6.75%, 3/15/32 96,068
------------
$ 243,793
------------
Trading Companies & Distributors - 0.2%
300,000 BBB-/Baa3 Glencore Funding LLC, 6.0%, 4/15/14 (144A) $ 273,986
------------
Total Capital Goods $ 709,418
------------
Automobiles & Components - 0.4%
Automobile Manufacturers - 0.4%
80,000 B+/Ba3 Ford Motor Co., 7.25%, 10/1/08 (b) $ 79,200
500,000 B-/Caa1 General Motors, 7.2%, 1/15/11 (b) 442,500
------------
$ 521,700
------------
Total Automobiles & Components $ 521,700
------------
The accompanying notes are an integral part of these financial statements. 23
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 6/30/06 (unaudited) (continued)
- --------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
Consumer Durables & Apparel - 0.2%
Home Furnishings - 0.1%
$ 95,000 BBB-/Baa3 Mohawk Industries, Inc., 6.125%, 1/15/16 $ 91,585
------------
Total Consumer Durables & Apparel $ 91,585
------------
Consumer Services - 0.1%
Hotels, Resorts & Cruise Lines - 0.2%
100,000 BBB-/Ba1 Royal Caribbean Cruises, 7.25%, 6/15/16 $ 99,027
------------
Total Consumer Services $ 99,027
------------
Media - 1.3%
Broadcasting & Cable TV - 0.9%
500,000 BBB+/Baa2 Comcast Cable Corp., 7.125%, 6/15/13 $ 523,766
80,000 BBB+/Baa2 Comcast Cable Corp., 5.3%, 1/15/14 75,267
300,000 BBB-/Baa3 Cox Communications, 7.125%, 10/1/12 310,297
150,000 BB+/Baa3 Cox Enterprises, 4.375%, 5/1/08 (144A) 145,181
------------
$ 1,054,511
------------
Publishing - 0.4%
512,000 BBB/Baa2 News America, Inc., 7.3%, 4/30/28 $ 519,196
------------
Total Media $ 1,573,707
------------
Retailing - 0.1%
Department Stores - 0.0%
15,000 A/Baa1 Nordstrom, Inc., 5.625%, 1/15/09 $ 14,927
------------
Specialty Stores - 0.1%
130,000 BBB-/Baa3 Tanger Factory Outlet Centers, Inc., 6.15%,
11/15/15 $ 126,303
------------
Total Retailing $ 141,230
------------
Food, Beverage & Tobacco - 0.1%
Brewers - 0.0%
35,000 BBB+/Baa1 Miller Brewing Co., 5.5%, 8/15/13 (144A) $ 33,582
------------
Packaged Foods & Meats - 0.1%
35,000 A+/A1 Unilever Capital Corp., 7.125%, 11/1/10 $ 36,748
------------
Soft Drinks - 0.0%
35,000 A/A3 Bottling Group LLC, 5.0%, 11/15/13 $ 33,284
------------
Total Food, Beverage & Tobacco $ 103,614
------------
Health Care Equipment & Services - 0.4%
Health Care Facilities - 0.4%
500,000 BB+/Ba2 HCA, Inc., 6.3%, 10/1/12 $ 470,261
------------
Total Health Care Equipment & Services $ 470,261
------------
24 The accompanying notes are an integral part of these financial statements.
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
Banks - 0.5%
Diversified Banks - 0.5%
$ 80,000 AAA/Aaa International Bank for Reconstruction &
Development, 4.375%, 9/28/06 $ 79,805
115,000 BB+/Baa2 Kazkommerts International BV, 8.0%, 11/3/15 111,550
150,000 AAA/Aaa KFW-Kredit Wiederaufbau, 2.75%, 5/8/07 146,524
225,000 AA-/Aa2 National Westminster, 7.375%, 10/1/09 238,246
30,000 AA-/Aa2 US Bancorp, 3.125%, 3/15/08 28,815
------------
$ 604,940
------------
Regional Banks - 0.0%
40,000 A-/A2 Keycorp, 2.75%, 2/27/07 $ 39,141
------------
Total Banks $ 644,081
------------
Diversified Financials - 0.6%
Consumer Finance - 0.2%
265,000 A/A2 SLM Corp., Floating Rate Note, 7/25/14 $ 242,146
------------
Investment Banking & Brokerage - 0.2%
200,000 B+/Ba2 E*Trade Financial Corp., 8.0%, 6/15/11 $ 204,000
------------
Diversified Financial Services - 0.2%
300,000 A-/Baa3 Brascan Corp., 5.75%, 3/1/10 $ 298,126
------------
Total Diversified Financials $ 744,272
------------
Insurance - 1.1%
Life & Health Insurance - 0.3%
300,000 BB+/Ba1 Provident Co., Inc., 7.0%, 7/15/18 $ 289,643
------------
Multi-Line Insurance - 0.1%
150,000 A/Baa1 Loew Corp., 5.25%, 3/15/16 $ 138,793
------------
Property & Casualty Insurance - 0.4%
180,000 BBB-/NR Kingsway America, Inc., 7.5%, 2/1/14 $ 178,233
350,000 BB+/Baa3 Ohio Casualty Corp., 7.3%, 6/15/14 353,995
------------
$ 532,228
------------
Reinsurance - 0.3%
300,000 BBB-/Baa3 Odyssey Re Holdings, 7.65%, 11/1/13 $ 288,243
100,000 BBB/NA Platinum Underwriters HD, 7.5%, 6/1/17 98,099
------------
$ 386,342
------------
Total Insurance $ 1,347,006
------------
The accompanying notes are an integral part of these financial statements. 25
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 6/30/06 (unaudited) (continued)
- --------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
Real Estate - 1.0%
Real Estate Investment Trusts - 1.0%
$ 300,000 BBB-/Baa3 Colonial Reality LP, 6.15%, 4/15/13 $ 295,610
300,000 BBB-/Baa3 Health Care REIT, Inc., 6.2%, 6/1/16 291,435
316,000 BB/Ba2 Host Marriott LP, 6.375%, 3/15/15 297,040
250,000 B+/B1 Trustreet Properties, Inc., 7.5%, 4/1/15 246,250
100,000 BB+/Ba2 Ventas Realty Capital Corp., 7.125%,
6/1/15 (144A) 100,000
------------
$ 1,230,335
------------
Total Real Estate $ 1,230,335
------------
Technology Hardware & Equipment - 0.4%
Computer Hardware - 0.4%
500,000 BBB-/Baa3 NCR Corp., 7.125%, 6/15/09 $ 510,414
------------
Total Technology Hardware & Equipment $ 510,414
------------
Semiconductors - 0.2%
250,000 BBB-/Baa3 Chartered Semiconductor, 6.375%, 8/3/15 $ 238,665
------------
Total Semiconductors $ 238,665
------------
Telecommunication Services - 0.5%
Integrated Telecommunication Services - 0.4%
250,000 BBB+/Baa2 Telecom Italia Capital, 4.875%, 10/1/10 $ 239,054
300,000 BBB+/Baa2 Telecom Italia Capital, 5.25%, 11/15/13 277,340
------------
$ 516,394
------------
Wireless Telecommunication Services - 0.1%
90,000 BBB-/Baa3 Embarq Corp., 7.082%, 6/1/16 $ 89,506
------------
Total Telecommunication Services $ 605,900
------------
Utilities - 0.1%
Electric Utilities - 0.1%
115,000 BBB+/Baa3 Entergy Gulf States, 5.7%, 6/1/15 $ 108,198
------------
Total Utilities $ 108,198
------------
TOTAL CORPORATE BONDS
(Cost $11,752,816) $ 11,521,186
------------
26 The accompanying notes are an integral part of these financial statements.
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
TOTAL CORPORATE BONDS
U.S. GOVERNMENT AND AGENCY OBLIGATIONS - 24.3%
Government - 24.3%
$ 100,000 AAA/Aaa Fannie Mae, 5.24%, 8/7/18 $ 94,863
65,000 AAA/Aaa Federal Home Loan Bank, 3.875%, 6/14/13 58,934
370,248 NR/Aaa Federal Home Loan Bank, 5.27%, 12/28/12 365,065
110,000 AAA/Aaa Federal Home Loan Bank, 6.0%, 4/15/32 111,173
300,000 AAA/Aaa Federal Home Loan Mortgage Corp., 3.25%, 2/25/08 289,235
772,329 AAA/Aaa Federal Home Loan Mortgage Corp., 4.5%, 12/1/20 729,165
860,097 AAA/Aaa Federal Home Loan Mortgage Corp., 5.0%, 11/1/34 805,827
826,990 AAA/Aaa Federal Home Loan Mortgage Corp., 5.0%, 4/1/34 774,810
241,188 NR/NR Federal Home Loan Mortgage Corp., 5.5%, 10/1/16 237,009
365,443 AAA/Aaa Federal Home Loan Mortgage Corp., 5.5%, 11/1/34 351,931
273,601 NR/NR Federal Home Loan Mortgage Corp., 5.5%, 12/1/18 269,472
907,785 AAA/Aaa Federal Home Loan Mortgage Corp., 5.5%, 12/1/34 874,220
478,279 AAA/Aaa Federal Home Loan Mortgage Corp., 5.5%, 12/1/35 459,681
184,687 NR/NR Federal Home Loan Mortgage Corp., 6.0%, 1/1/33 182,522
273,323 NR/NR Federal Home Loan Mortgage Corp., 6.0%, 4/1/33 270,120
330,594 AAA/Aaa Federal Home Loan Mortgage Corp., 6.0%, 5/1/33 326,491
156,800 AAA/Aaa Federal Home Loan Mortgage Corp., 6.0%, 6/1/34 154,696
157,990 AAA/Aaa Federal Home Loan Mortgage Corp., 6.5%, 10/1/33 159,951
19,891 NR/NR Federal Home Loan Mortgage Corp., 6.5%, 11/1/33 20,144
47,079 NR/NR Federal Home Loan Mortgage Corp., 6.5%, 5/1/09 47,347
304,815 AAA/Aaa Federal Home Loan Mortgage Corp., 6.5%, 5/1/32 307,506
104,861 AAA/Aaa Federal National Mortgage Association, 4.78%, 12/1/12 100,303
157,936 AAA/Aaa Federal National Mortgage Association, 5.0%, 12/1/17 152,456
121,464 AAA/Aaa Federal National Mortgage Association, 5.0%, 3/1/33 114,092
347,536 AAA/Aaa Federal National Mortgage Association, 5.0%, 5/1/18 335,464
391,356 AAA/Aaa Federal National Mortgage Association, 5.0%, 6/1/34 366,997
350,000 AAA/Aaa Federal National Mortgage Association, 5.2%, 11/8/10 344,106
344,182 AAA/Aaa Federal National Mortgage Association, 5.5%, 11/1/33 332,033
173,512 AAA/Aaa Federal National Mortgage Association, 5.5%, 12/1/34 167,101
409,523 NR/NR Federal National Mortgage Association, 5.5%, 2/1/17 402,676
81,204 AAA/Aaa Federal National Mortgage Association, 5.5%, 2/1/18 79,879
109,597 NR/NR Federal National Mortgage Association, 5.5%, 3/1/34 105,548
323,355 AAA/Aaa Federal National Mortgage Association, 5.5%, 4/1/34 311,408
48,105 AAA/Aaa Federal National Mortgage Association, 5.5%, 7/1/23 46,835
230,040 AAA/Aaa Federal National Mortgage Association, 5.5%, 8/1/14 226,731
52,955 AAA/Aaa Federal National Mortgage Association, 5.5%, 9/1/17 52,079
38,210 AAA/Aaa Federal National Mortgage Association, 6.0%, 1/1/29 37,795
10,888 AAA/Aaa Federal National Mortgage Association, 6.0%, 1/1/29 11,039
233,175 NR/NR Federal National Mortgage Association, 6.0%, 1/1/33 230,366
240,564 AAA/Aaa Federal National Mortgage Association, 6.0%, 12/1/33 237,511
259,439 NR/NR Federal National Mortgage Association, 6.0%, 2/1/33 256,147
The accompanying notes are an integral part of these financial statements. 27
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 6/30/06 (unaudited) (continued)
- --------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
TOTAL CORPORATE BONDS
$ 35,001 AAA/Aaa Federal National Mortgage Association, 6.0%, 3/1/33 $ 34,557
1,000,000 AAA/Aaa Federal National Mortgage Association, 6.0%, 7/1/36 984,062
43,780 AAA/Aaa Federal National Mortgage Association, 6.0%, 8/1/32 43,252
15,105 AAA/Aaa Federal National Mortgage Association, 6.0%, 9/1/29 14,940
1,260,000 AAA/Aaa Federal National Mortgage Association,6.125%, 3/15/12 1,298,144
35,425 NR/NR Federal National Mortgage Association, 6.5%, 10/1/32 35,738
124,003 NR/NR Federal National Mortgage Association, 6.5%, 4/1/29 125,896
46,823 AAA/Aaa Federal National Mortgage Association, 6.5%, 7/1/29 47,304
254,115 NR/NR Federal National Mortgage Association, 6.5%, 7/1/32 256,358
119,912 NR/NR Federal National Mortgage Association, 6.5%, 9/1/32 121,527
122,764 AAA/Aaa Federal National Mortgage Association, 6.5%, 12/1/21 124,243
13,767 AAA/Aaa Federal National Mortgage Association, 7.0%, 3/1/12 14,021
40,000 AAA/Aaa Federal National Mortgage Association,7.125%, 6/15/10 42,323
3,655 AAA/Aaa Federal National Mortgage Association, 8.0%, 1/1/31 3,857
5,069 AAA/Aaa Federal National Mortgage Association, 8.0%, 10/1/30 5,350
12,321 AAA/Aaa Federal National Mortgage Association, 8.0%, 2/1/29 13,021
1,822 AAA/Aaa Federal National Mortgage Association, 8.0%, 2/1/30 1,925
27,556 AAA/Aaa Federal National Mortgage Association, 8.0%, 3/1/31 29,115
6,028 AAA/Aaa Federal National Mortgage Association, 8.0%, 4/1/20 6,362
2,205 AAA/Aaa Federal National Mortgage Association, 8.0%, 4/1/30 2,328
2,316 AAA/Aaa Federal National Mortgage Association, 8.0%, 5/1/31 2,444
2,124 AAA/Aaa Federal National Mortgage Association, 8.0%, 7/1/30 2,241
47,027 AAA/Aaa Federal National Mortgage Association, 9.0%, 4/1/33 49,670
354,823 NR/NR Government National Mortgage Association II,
5.5%, 2/20/34 342,783
379,197 AAA/Aaa Government National Mortgage Association II,
6.0%, 10/20/33 377,014
114,149 AAA/Aaa Government National Mortgage Association,
4.5%, 1/15/35 104,830
176,729 AAA/Aaa Government National Mortgage Association,
4.5%, 4/15/35 162,301
399,285 AAA/Aaa Government National Mortgage Association,
5.0%, 10/15/34 377,970
283,371 AAA/Aaa Government National Mortgage Association,
5.0%, 4/15/34 268,507
192,460 AAA/Aaa Government National Mortgage Association,
5.5%, 10/15/33 186,782
238,669 AAA/Aaa Government National Mortgage Association,
5.5%, 12/15/34 231,539
457,877 AAA/Aaa Government National Mortgage Association,
5.5%, 8/15/17 452,800
28 The accompanying notes are an integral part of these financial statements.
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
TOTAL CORPORATE BONDS
$ 378,939 AAA/Aaa Government National Mortgage Association,
5.5%, 8/15/19 $ 374,540
117,176 AAA/Aaa Government National Mortgage Association,
5.5%, 8/15/33 113,719
338,841 NR/NR Government National Mortgage Association,
5.5%, 8/15/33 328,845
93,621 AAA/Aaa Government National Mortgage Association,
5.5%, 9/15/33 90,916
424,619 AAA/Aaa Government National Mortgage Association,
5.50%, 8/15/33 412,092
204,160 NR/NR Government National Mortgage Association,
6.0%, 10/15/33 202,796
5,232 NR/NR Government National Mortgage Association,
6.0%, 4/15/14 5,269
17,711 AAA/Aaa Government National Mortgage Association,
6.0%, 8/15/13 17,808
762,192 AAA/Aaa Government National Mortgage Association,
6.0%, 8/15/34 756,913
832,221 AAA/Aaa Government National Mortgage Association,
6.0%, 9/15/33 826,660
261,693 AAA/Aaa Government National Mortgage Association,
6.0%, 9/15/34 259,881
385,759 AAA/Aaa Government National Mortgage Association,
6.0%, 12/15/33 383,182
190,571 NR/NR Government National Mortgage Association,
6.5%, 10/15/28 193,517
88,320 NR/NR Government National Mortgage Association,
6.5%, 5/15/33 89,472
10,751 AAA/Aaa Government National Mortgage Association,
7.0%, 4/15/28 11,092
3,283 NR/NR Government National Mortgage Association,
7.0%, 8/15/28 3,387
7,208 NR/NR Government National Mortgage Association,
7.5%, 1/15/30 7,536
4,449 NR/NR Government National Mortgage Association,
7.75%, 11/15/29 4,693
29,527 NR/NR Government National Mortgage Association,
8.0%, 2/15/30 31,348
200,000 AAA/Aaa U.S. Treasury Bonds, 4.0%, 2/15/14 185,797
720,000 AAA/Aaa U.S. Treasury Bonds, 5.25%, 11/15/28 716,625
200,000 AAA/Aaa U.S. Treasury Bonds, 6.25%, 8/15/23 220,578
100,000 AAA/Aaa U.S. Treasury Bonds, 7.125%, 2/15/23 119,641
The accompanying notes are an integral part of these financial statements. 29
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 6/30/06 (unaudited) (continued)
- --------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
TOTAL CORPORATE BONDS
$ 62,139 AAA/Aaa U.S. Treasury Inflation Notes, 1.875%, 7/15/15 $ 58,962
453,792 AAA/Aaa U.S. Treasury Inflation Protected Security,
3.375%, 1/15/12 475,347
173,613 AAA/Aaa U.S. Treasury Inflation Protected Security,
3.5%, 1/15/11 181,595
1,985,000 AAA/Aaa U.S. Treasury Notes, 4.0%, 11/15/12 1,865,745
800,000 AAA/Aaa U.S. Treasury Notes, 4.125%, 5/15/15 742,844
300,000 AAA/Aaa U.S. Treasury Notes, 4.25%, 11/15/14 282,141
400,000 AAA/Aaa U.S. Treasury Notes, 4.25%, 8/15/15 374,266
700,000 AAA/Aaa U.S. Treasury Notes, 4.75%, 11/15/08 693,739
360,000 AAA/Aaa U.S. Treasury Notes, 5.375%, 2/15/31 366,216
95,000 AAA/Aaa U.S. Treasury Notes, 5.5%, 8/15/28 97,605
1,100,000 AAA/Aaa U.S. Treasury Notes, 5.625%, 5/15/08 1,108,680
500,000 AAA/Aaa U.S. Treasury Notes, 4.75%, 5/15/14 487,744
200,000 AAA/Aaa U.S. Treasury Strip, 0.0%, 11/15/15 123,202
------------
$ 28,778,325
------------
TOTAL U.S. GOVERNMENT AND AGENCY OBLIGATIONS
(Cost $29,919,793) $ 28,778,325
------------
Shares TEMPORARY CASH INVESTMENT - 3.6%
Security Lending Collateral - 3.6%
4,186,236 Securities Lending Investment Fund, 5.16% $ 4,186,236
------------
TOTAL TEMPORARY CASH INVESTMENT
(Cost $4,186,236) $ 4,186,236
------------
TOTAL INVESTMENT IN SECURITIES - 103.0%
(Cost $110,536,744) $122,125,558
------------
OTHER ASSETS AND LIABILITIES - (3.0)% $ (3,509,996)
------------
TOTAL NET ASSETS - 100.0% $118,615,562
============
(A.D.R.) American Depositary Receipt
* Non-income producing security
N/R Not rated by either S&P or Moody's
(144A) Security is exempt from registration under Rule 144A of the Securities
Act of 1933. Such securities may be resold normally to qualified
institutional buyers in a transaction exempt from registration At June
30, 2006, the value of these securities amounted to $2,110,712 or 1.8%
of total net assets.
(a) At June 30, 2006, the net unrealized gain on investments based on cost for federal income tax
purposes of $110,568,116 was as follows:
Aggregate gross unrealized gain for all investments in
which there is an excess of value over tax cost $ 15,375,743
Aggregate gross unrealized loss for all investments in
which there is an excess of tax cost over value (3,818,301)
------------
Net unrealized gain $ 11,557,442
============
30 The accompanying notes are an integral part of these financial statements.
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(b) At June 30, 2006, the following securities were out on loan:
Principal Market
Amount Security Value
$ 14,751 Anheuser-Busch Companies, Inc. $ 672,498
9,603 Cintas Corp.* 381,815
16,236 Encana Corp. 854,663
79,000 Ford Motor Co., 7.25%, 10/1/08 79,626
495,000 General Motors, 7.2%, 1/15/11 454,410
12,692 Newmont Mining Corp. 671,788
31,300 Teva Pharmaceutical Industries, Ltd. 988,767
----------
Total $4,103,567
==========
Purchases and sales of securities (excluding temporary cash investments) for
the six months ended June 30, 2006 aggregated $8,157,032 and $17,716,686,
respectively.
The accompanying notes are an integral part of these financial statements. 31
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES 6/30/06 (unaudited)
- --------------------------------------------------------------------------------
ASSETS:
Investment in securities (including securities loaned of
$4,103,567) (cost $110,536,744) $122,125,558
Cash 429,095
Receivables -
Investment securities sold 1,174,401
Fund shares sold 21,535
Forward foreign currency portfolio hedge contracts, open net 5,556
Dividends, interest and foreign taxes withheld 434,246
Due from Pioneer Investment Management, Inc. 536
Other 19,427
------------
Total assets $124,210,354
------------
LIABILITIES:
Payables -
Investment securities purchased $ 982,156
Fund shares repurchased 324,124
Upon return of securities loaned 4,186,236
Due to affiliates 51,792
Accrued expenses 50,484
------------
Total liabilities $ 5,594,792
------------
NET ASSETS:
Paid-in capital $110,220,206
Distributions in excess of net investment income (23,901)
Accumulated net realized loss on investments and foreign currency
transactions (3,175,042)
Net unrealized gain on investments 11,588,814
Net unrealized gain on forward foreign currency contracts and
other assets and liabilities denominated in foreign currencies 5,485
------------
Total net assets $118,615,562
============
NET ASSET VALUE PER SHARE:
(Unlimited number of shares authorized)
Class A (based on $86,935,396/8,851,197 shares) $ 9.82
============
Class B (based on $13,531,823/1,395,652 shares) $ 9.70
============
Class C (based on $10,092,788/1,031,763 shares) $ 9.78
============
Investor Class (based on $8,055,555/820,551 shares) $ 9.82
============
MAXIMUM OFFERING PRICE:
Class A ($9.82 [divided by] 95.5%) $ 10.28
============
32 The accompanying notes are an integral part of these financial statements.
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS (unaudited)
- --------------------------------------------------------------------------------
For the Six Months Ended 6/30/06
INVESTMENT INCOME:
Dividends (net of foreign taxes withheld of $563) $ 501,416
Interest 1,168,093
Income from securities loaned, net 5,453
-----------
Total investment income $ 1,674,962
-----------
EXPENSES:
Management fees $ 409,643
Transfer agent fees and expenses
Class A 138,351
Class B 36,370
Class C 19,050
Investor Class 17,032
Distribution fees
Class A 109,730
Class B 73,572
Class C 58,198
Administrative reimbursements 12,345
Custodian fees 10,559
Professional fees 15,901
Printing expense 24,722
Fees and expenses of nonaffiliated trustees 4,257
Miscellaneous 12,920
-----------
Total expenses $ 942,650
Less management fees waived and
expenses reimbursed by Pioneer
Investment Management, Inc. (3,075)
-----------
Net expenses $ 939,575
-----------
Net investment income $ 735,387
-----------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Net realized gain (loss) on:
Investments $ 2,132,702
Forward foreign currency contracts and other assets
and liabilities denominated in foreign currencies (191) $ 2,132,511
----------- -----------
Change in net unrealized gain on:
Investments $(2,830,447)
Forward foreign currency contracts and other assets
and liabilities denominated in foreign currencies 5,485 $(2,824,962)
----------- -----------
Net loss on investments and foreign
currency transactions $ (692,451)
-----------
Net increase in net assets resulting from operations $ 42,936
===========
The accompanying notes are an integral part of these financial statements. 33
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
For the Six Months Ended 6/30/06 and the Year Ended 12/31/05
Six Months
Ended Year
6/30/06 Ended
(unaudited) 12/31/05
FROM OPERATIONS:
Net investment income $ 735,387 $ 1,431,146
Net realized gain on investments and foreign currency
transactions 2,132,511 4,998,446
Change in net unrealized loss on investments and
foreign currency transactions (2,824,962) (2,249,215)
------------- -------------
Net increase in net assets resulting from
operations $ 42,936 $ 4,180,377
------------- -------------
DISTRIBUTIONS TO SHAREOWNERS:
Net investment income:
Class A ($0.07 and $0.14 per share, respectively) $ (629,082) $ (1,384,378)
Class B ($0.03 and $0.06 per share, respectively) (43,193) (101,717)
Class C ($0.03 and $0.07 per share, respectively) (33,179) (95,269)
Investor Class ($0.09 and $0.17 per share,
respectively) (76,125) (167,088)
------------- -------------
Total distributions to shareowners $ (781,579) $ (1,748,452)
------------- -------------
FROM FUND SHARE TRANSACTIONS:
Net proceeds from sale of shares $ 6,389,493 $ 13,360,430
Reinvestment of distributions 714,822 1,595,887
Cost of shares repurchased (17,970,814) (38,298,111)
------------- -------------
Net decrease in net assets resulting from
Fund share transactions $ (10,866,499) $ (23,341,794)
------------- -------------
Net decrease in net assets $ (11,605,142) $ (20,909,869)
NET ASSETS:
Beginning of period 130,220,704 151,130,573
------------- -------------
End of period (including undistributed (distributions in
excess of) net investment income of ($23,901) and
$22,291 respectively) $ 118,615,562 $ 130,220,704
============= =============
34 The accompanying notes are an integral part of these financial statements.
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
'06 Shares '06 Amount '05 Shares '05 Amounts
(unaudited) (unaudited)
CLASS A
Shares sold 423,777 $ 4,281,184 801,871 $ 7,780,552
Reinvestment of distributions 58,105 574,161 129,132 1,260,024
Less shares repurchased (1,001,540) (10,049,384) (1,946,433) (18,968,004)
---------- ------------- ---------- -------------
Net decrease (519,658) $ (5,194,039) (1,015,430) $ (9,927,428)
========== ============= ========== =============
CLASS B
Shares sold 125,503 $ 1,245,244 358,655 $ 3,442,850
Reinvestment of distributions 3,791 36,888 9,121 88,008
Less shares repurchased (378,142) (3,764,385) (635,188) (6,084,346)
---------- ------------- ---------- -------------
Net decrease (248,848) $ (2,482,253) (267,412) $ (2,553,488)
========== ============= ========== =============
CLASS C
Shares sold 85,849 $ 857,144 219,863 $ 2,130,962
Reinvestment of distributions 3,142 30,831 9,043 87,662
Less shares repurchased (316,860) (3,161,265) (386,809) (3,755,990)
---------- ------------- ---------- -------------
Net decrease (227,869) $ (2,273,290) (157,903) $ (1,537,366)
========== ============= ========== =============
INVESTOR CLASS
Shares sold 591 $ 5,921 612 $ 6,066
Reinvestment of distributions 7,373 72,942 16,430 160,193
Less shares repurchased (98,659) (995,780) (969,565) (9,489,771)
---------- ------------- ---------- -------------
Net decrease (90,695) $ (916,917) (952,523) $ (9,323,512)
========== ============= ========== =============
The accompanying notes are an integral part of these financial statements. 35
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Six Months
Ended
6/30/06 Year Ended
(unaudited) 12/31/05
CLASS A
Net asset value, beginning of period $ 9.89 $ 9.72
------- -------
Increase (decrease) from investment operations:
Net investment income $ 0.07 $ 0.11
Net realized and unrealized gain (loss) on investments (0.07) 0.20
------- -------
Net increase (decrease) from investment operations $ - $ 0.31
Distributions to shareowners:
Net investment income (0.07) (0.14)
------- -------
Net increase (decrease) in net asset value $ (0.07) $ 0.17
------- -------
Net asset value, end of period $ 9.82 $ 9.89
======= =======
Total return* 0.00% 3.25%
Ratio of net expenses to average net assets+ 1.32%** 1.35%
Ratio of net investment income to average net assets+ 1.34%** 1.21%
Portfolio turnover rate 13%** 26%
Net assets, end of period (in thousands) $86,935 $92,715
Ratios with reductions for fees paid indirectly:
Net expenses 1.32%** 1.35%
Net investment income 1.34%** 1.21%
Year Ended Year Ended Year Ended Year Ended
12/31/04 12/31/03 12/31/02 12/31/01 (a)
CLASS A
Net asset value, beginning of period $ 9.47 $ 8.29 $ 9.46 $ 9.94
-------- -------- -------- --------
Increase (decrease) from investment operations:
Net investment income $ 0.14 $ 0.12 $ 0.11 $ 0.19
Net realized and unrealized gain (loss) on investments 0.27 1.20 (1.17) (0.47)
-------- -------- -------- --------
Net increase (decrease) from investment operations $ 0.41 $ 1.32 $ (1.06) $ (0.28)
Distributions to shareowners:
Net investment income (0.17) (0.14) (0.11) (0.20)
-------- -------- -------- --------
Net increase (decrease) in net asset value $ 0.25 $ 1.18 $ (1.17) $ (0.48)
-------- -------- -------- --------
Net asset value, end of period $ 9.71 $ 9.47 $ 8.29 $ 9.46
======== ======== ======== ========
Total return* 4.43% 15.99% (11.20)% (2.87)%
Ratio of net expenses to average net assets+ 1.29% 1.38% 1.41% 1.31%
Ratio of net investment income to average net assets+ 1.51% 1.25% 1.19% 1.97%
Portfolio turnover rate 31% 44% 180% 133%
Net assets, end of period (in thousands) $100,920 $107,265 $106,734 $141,746
Ratios with reductions for fees paid indirectly:
Net expenses 1.29% 1.38% 1.41% 1.30%
Net investment income 1.51% 1.25% 1.19% 1.98%
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized.
+ Ratio with no reduction for fees paid indirectly.
(a) At January 1, 2001, the Fund began accreting discounts and amortizing
premiums on debt securities. The effect of this change for the year ended
December 31, 2001, was to decrease net investment income by less than one
cent per share, increase net realized and unrealized gain (loss) by less
than one cent per share and decrease the ratio of net investment income to
average net assets assuming reduction for fees paid indirectly from 2.02%
to 1.98%. Per share ratios and supplemental data for periods prior to
January 1, 2001, have not been restated to reflect this change in
presentation.
The accompanying notes are an integral part of these financial statements.
36
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Six Months
Ended
6/30/06 Year Ended
(unaudited) 12/31/05
CLASS B
Net asset value, beginning of period $ 9.77 $ 9.61
------- -------
Increase (decrease) from investment operations:
Net investment income $ 0.02 $ 0.02
Net realized and unrealized gain (loss) on investments (0.06) 0.20
------- -------
Net increase (decrease) from investment operations $ (0.04) $ 0.22
Distributions to shareowners:
Net investment income (0.03) (0.06)
------- -------
Net increase (decrease) in net asset value $ (0.07) $ 0.16
------- -------
Net asset value, end of period $ 9.70 $ 9.77
======= =======
Total return* (0.41)% 2.29%
Ratio of net expenses to average net assets+ 2.27%** 2.30%
Ratio of net investment income to average net assets+ 0.38%** 0.26%
Portfolio turnover rate 13%** 26%
Net assets, end of period (in thousands) $13,532 $16,074
Ratios with reduction for fees paid indirectly:
Net expenses 2.27%** 2.30%
Net investment income 0.38%** 0.26%
Year Ended Year Ended Year Ended Year Ended
12/31/04 12/31/03 12/31/02 12/31/01 (a)
CLASS B
Net asset value, beginning of period $ 9.37 $ 8.21 $ 9.36 $ 9.85
------- ------- --------- -------
Increase (decrease) from investment operations:
Net investment income $ 0.05 $ 0.03 $ 0.02 $ 0.12
Net realized and unrealized gain (loss) on investments 0.27 1.18 (1.13) (0.48)
------- ------- --------- -------
Net increase (decrease) from investment operations $ 0.32 $ 1.21 $ (1.11) $ (0.36)
Distributions to shareowners:
Net investment income (0.08) (0.05) (0.04) (0.13)
------- ------- --------- -------
Net increase (decrease) in net asset value $ 0.24 $ 1.16 $ (1.15) $ (0.49)
------- ------- --------- -------
Net asset value, end of period $ 9.61 $ 9.37 $ 8.21 $ 9.36
======= ======= ========= =======
Total return* 3.48% 14.71% (11.90)% (3.72)%
Ratio of net expenses to average net assets+ 2.24% 2.35% 2.32% 2.20%
Ratio of net investment income to average net assets+ 0.59% 0.27% 0.28% 1.04%
Portfolio turnover rate 31% 44% 180% 133%
Net assets, end of period (in thousands) $18,369 $16,168 $ 16,256 $18,110
Ratios with reduction for fees paid indirectly:
Net expenses 2.24% 2.35% 2.32% 2.19%
Net investment income 0.59% 0.27% 0.28% 1.05%
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized.
+ Ratio with no reduction for fees paid indirectly.
(a) At January 1, 2001, the Fund began accreting discounts and amortizing
premiums on debt securities. The effect of this change for the year ended
December 31, 2001, was to decrease net investment income by less than one
cent per share, increase net realized and unrealized gain (loss) by less
than one cent per share and decrease the ratio of net investment income to
average net assets assuming reduction for fees paid indirectly from 1.08%
to 1.05%. Per share ratios and supplemental data for periods prior to
January 1, 2001, have not been restated to reflect this change in
presentation.
The accompanying notes are an integral part of these financial statements.
37
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Six Months
Ended
6/30/06 Year Ended
(unaudited) 12/31/05
CLASS C
Net asset value, beginning of period $ 9.85 $ 9.68
------- -------
Increase (decrease) from investment operations:
Net investment income $ 0.03 $ 0.04
Net realized and unrealized gain (loss) on investments (0.07) 0.20
------- -------
Net increase (decrease) from investment operations $ (0.04) $ 0.24
Distributions to shareowners:
Net investment income (0.03) (0.07)
------- -------
Net increase (decrease) in net asset value $ (0.07) $ 0.17
------- -------
Net asset value, end of period $ 9.78 $ 9.85
======= =======
Total return* (0.41)% 2.51%
Ratio of net expenses to average net assets+ 2.10%** 2.12%
Ratio of net investment income to average net assets+ 0.55%** 0.44%
Portfolio turnover rate 13%** 26%
Net assets, end of period (in thousands) $10,093 $12,411
Ratios with reduction for fees paid indirectly:
Net expenses 2.10%** 2.12%
Net investment income 0.55%** 0.44%
Year Ended Year Ended Year Ended Year Ended
12/31/04 12/31/03 12/31/02 12/31/01 (a)
CLASS C
Net asset value, beginning of period $ 9.45 $ 8.27 $ 9.44 $ 9.94
------- ------- --------- -------
Increase (decrease) from investment operations:
Net investment income $ 0.06 $ 0.02 $ 0.01 $ 0.13
Net realized and unrealized gain (loss) on investments 0.26 1.20 (1.14) (0.54)
------- ------- --------- -------
Net increase (decrease) from investment operations $ 0.32 $ 1.22 $ (1.13) $ (0.41)
Distributions to shareowners:
Net investment income (0.09) (0.04) (0.04) (0.09)
------- ------- --------- -------
Net increase (decrease) in net asset value $ 0.23 $ 1.18 $ (1.17) $ (0.50)
------- ------- --------- -------
Net asset value, end of period $ 9.68 $ 9.45 $ 8.27 $ 9.44
======= ======= ========= =======
Total return* 3.42% 14.82% (12.02)% (4.11)%
Ratio of net expenses to average net assets+ 2.18% 2.38% 2.53% 2.44%
Ratio of net investment income to average net assets+ 0.73% 0.24% 0.06% 0.75%
Portfolio turnover rate 31% 44% 180% 133%
Net assets, end of period (in thousands) $13,720 $ 8,416 $ 7,806 $ 5,499
Ratios with reduction for fees paid indirectly:
Net expenses 2.18% 2.38% 2.53% 2.43%
Net investment income 0.73% 0.24% 0.06% 0.76%
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized.
+ Ratio with no reduction for fees paid indirectly.
(a) At January 1, 2001, the Fund began accreting discounts and amortizing
premiums on debt securities. The effect of this change for the year ended
December 31, 2001, was to decrease net investment income by less than one
cent per share, increase net realized and unrealized gain (loss) by less
than one cent per share and decrease the ratio of net investment income to
average net assets assuming reduction for fees paid indirectly from 0.86%
to 0.76%. Per share ratios and supplemental data for periods prior to
January 1, 2001, have not been restated to reflect this change in
presentation.
The accompanying notes are an integral part of these financial statements.
38
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Six Months
Ended 12/11/04 (a)
6/30/06 Year Ended to
(unaudited) 12/31/05 12/31/04
INVESTOR CLASS
Net asset value, beginning of period $ 9.90 $ 9.72 $ 9.66
------- ------- -------
Increase from investment operations:
Net investment income $ 0.08 $ 0.18 $ 0.01
Net realized and unrealized gain (loss)
on investments (0.07) 0.17 0.05
------- ------- -------
Net increase from investment operations $ 0.01 $ 0.35 $ 0.06
Distributions to shareowners:
Net investment income (0.09) (0.17) -
------- ------- -------
Net increase (decrease) in net asset value $ (0.08) $ 0.18 $ 0.06
------- ------- -------
Net asset value, end of period $ 9.82 $ 9.90 $ 9.72
======= ======= =======
Total return* 0.10% 3.62% 0.62%(b)
Ratio of net expenses to average net assets+ 1.10%** 1.11% 1.06%**
Ratio of net investment income to average
net assets+ 1.56%** 1.49% 1.06%**
Portfolio turnover rate 13%** 26% 31%
Net assets, end of period (in thousands) $ 8,056 $ 9,020 $18,121
Ratios with no assumption of expenses by
PIM and no reduction for fees paid
indirectly:
Net expenses 1.17%** 1.14% 1.06%**
Net investment income 1.49%** 1.45% 1.06%**
Ratios with assumption of expenses by PIM
and reduction for fees paid indirectly:
Net expenses 1.10%** 1.10% 1.06%**
Net investment income 1.56%** 1.49% 1.06%**
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges.
** Annualized.
+ Ratio with no reduction for fees paid indirectly.
(a) Investor class shares commenced operations on December 11, 2004.
(b) Not Annualized
The accompanying notes are an integral part of these financial statements. 39
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 6/30/06 (unaudited)
- --------------------------------------------------------------------------------
1. Organization and Significant Accounting Policies
Pioneer Balanced Fund (the Fund) is a Delaware statutory trust registered under
the Investment Company Act of 1940 as a diversified, open-end management
investment company. The Fund's investment objective is to seek capital growth
and current income by actively managing investments in a diversified portfolio
of equity securities and bonds.
The Trustees have authorized the issuance of four classes of shares of the
Fund. The Fund offers four Classes of shares designated as - Class A, Class B,
Class C and Investor Class shares. Investor Class shares were first issued
December 10, 2004. The Fund is not offering additional Investor Class shares
except in connection with the reinvestment of dividends on the Fund's
outstanding Investor Class shares. Each class of shares represents an interest
in the same portfolio of investments of the Fund and have equal rights to
voting, redemptions, dividends and liquidation, except that each class of
shares can bear different transfer agent and distribution fees and has
exclusive voting rights with respect to the distribution plans that have been
adopted by Class A, Class B and Class C shareowners, respectively. There is no
distribution plan for Investor Class shares.
The Fund's financial statements have been prepared in conformity with U.S.
generally accepted accounting principles that require the management of the
Fund to, among other things, make estimates and assumptions that affect the
reported amounts of assets and liabilities, the disclosure of contingent assets
and liabilities at the date of the financial statements, and the reported
amounts of income, expenses and gain and losses on investments during the
reporting year. Actual results could differ from those estimates. The following
is a summary of significant accounting policies followed by the Fund in the
preparation of its financial statements, which are consistent with those
policies generally accepted in the investment company industry:
A. Security Valuation
Security transactions are recorded as of trade date. The net asset value
of the Fund is computed once daily, on each day the New York Stock
Exchange (NYSE) is open, as of the close of regular trading on the NYSE.
In computing the net asset value, debt securities are valued at prices
supplied by independent pricing services,
40
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
which consider such factors as Treasury spreads, yields, maturities and
ratings. Valuations may be supplemented by dealers and other sources, as
required. Equity securities are valued at the last sale price on the
principal exchange where they are traded. Securities that have not traded
on the date of valuation, or securities for which sale prices are not
generally reported, are valued at the mean between the last bid and asked
prices. Securities for which market quotations are not readily available
are valued at their fair values as determined by, or under the direction
of, the Board of Trustees. Trading in foreign securities is substantially
completed each day at various times prior to the close of the NYSE. The
values of such securities used in computing the net asset value of the
Fund's shares are determined as of such times. The Fund also may use the
fair value of a security including a non-U.S. security when the closing
market price on the principal exchange where the security is traded no
longer reflects the value of the security. At June 30, 2006 there were no
securities fair valued. Temporary cash investments are valued at amortized
cost.
Dividend income is recorded on the ex-dividend date except that certain
dividends from foreign securities where the ex dividend date may have
passed are recorded as soon as the Fund becomes aware of the ex-dividend
data in exercise of reasonable diligence. Interest income is recorded on
the accrual basis. All discounts/premiums on debt securities are
accreted/amortized into interest income for financial reporting purposes.
Gains and losses on sales of investments are calculated on the identified
cost method for both financial reporting and federal income tax purposes.
The Fund invests in REIT securities, the value of which can fall for a
variety of reasons, such as declines in rental income, fluctuating
interest rates, poor property management, environmental liabilities,
uninsured damage, increased competition, or changes in real estate tax
laws. The Fund may invest in mortgage-backed securities, which during
times of fluctuating interest rates may increase of decrease more than
other fixed-income securities. Mortgage backed securities are also subject
to pre-payments. At times, the Fund's investments may represent industries
or industry sectors that are interrelated or have common risks, making it
more susceptible to any economic, political, or regulatory developments or
other
41
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 6/30/06 (unaudited) (continued)
- --------------------------------------------------------------------------------
risks affecting those industries and sectors. Information regarding the
Fund's principal risk is contained in the Fund's prospectus. Please refer
to those documents when considering the Fund's risks.
B. Futures Contracts
The Fund may enter into futures transactions to hedge against changes in
interest rates, securities prices, and currency rates or to seek to
increase total return. Upon entering into a futures contract, the Fund is
required to deposit with a broker an amount of cash or securities equal to
the minimum "initial margin" requirements of the associated futures
exchange. Subsequent payments on futures contracts ("variation margin")
are paid or received by the Fund, depending on the daily fluctuation in
the value of the contracts, and are recorded by the Fund as unrealized
gains or losses. When the contract is closed, the Fund realizes a gain or
loss equal to the difference between the opening and closing value of the
contract. The use of futures contracts involves, to varying degrees,
elements of market risk which may exceed the amounts recognized by the
Fund. Changes in the value of the contracts may not directly correlate to
the changes in the value of the underlying securities. These risks may
decrease the effectiveness of the Fund's hedging and trading strategies
and potentially result in a loss. As of June 30, 2006, the Fund had no
open futures contracts.
C. Forward Foreign Currency Contracts
The Fund enters into forward foreign currency contracts (contracts) for
the purchase or sale of a specific foreign currency at a fixed price on a
future date as a hedge or cross-hedge against either specific investment
transactions (settlement hedges) or portfolio positions (portfolio
hedges). All contracts are marked to market daily at the applicable
exchange rates, and any resulting unrealized gains or losses are recorded
in the Fund's financial statements. The Fund records realized gains and
losses at the time a portfolio hedge is offset by entry into a closing
transaction or extinguished by delivery of the currency. Risks may arise
upon entering into these contracts from the potential inability of
counterparties to meet the terms of the contract and from unanticipated
movements in the value of foreign currencies relative to the U.S. dollar
(see Note 7).
42
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
D. Federal Income Taxes
It is the Fund's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income and net realized capital gains, if
any, to its shareowners. Therefore, no federal income tax provision is
required.
The amounts and characterizations of distributions to shareowners for
financial reporting purposes are determined in accordance with federal
income tax rules. Therefore, the sources of the Fund's distributions may
be shown in the accompanying financial statements as either from or in
excess of net investment income or net realized gain on investment
transactions, or from paid-in capital, depending on the type of book/tax
differences that may exist.
The tax character of current year distributions paid will be determined at
the end of the current fiscal year. The tax character of distributions
paid during the year ended December 31, 2005 and was as follows:
- --------------------------------------------------------------------
2005
- --------------------------------------------------------------------
Distributions paid from:
Ordinary income $1,748,452
Long-term capital gain -
----------
Total $1,748,452
==========
- --------------------------------------------------------------------
The following shows the components of distributable earnings on a
federal income tax basis at December 31, 2005.
- --------------------------------------------------------------------
2005
- --------------------------------------------------------------------
Undistributed ordinary income $ 31,314
Capital loss carryforward (5,285,204)
Unrealized appreciation 14,387,889
----------
Total $9,133,999
==========
- --------------------------------------------------------------------
The difference between book-basis and tax-basis unrealized appreciation is
attributable to the tax deferral of losses on wash sales and the tax
treatment of premium and amortization.
43
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 6/30/06 (unaudited) (continued)
- --------------------------------------------------------------------------------
E. Fund Shares
The Fund records sales and repurchases of its shares as of trade date.
Pioneer Funds Distributor, Inc. (PFD), the principal underwriter for the
Fund and a wholly owned subsidiary of UniCredito Italiano S.p.A.
(UniCredito Italiano), earned $7,919 in underwriting commissions on the
sale of Class A shares during the six months ended June 30, 2006.
F. Class Allocations
Distribution fees are calculated based on the average daily net asset
value attributable to Class A, Class B and Class C shares of the Fund,
respectively (see Note 4). Investor Class shares are not subject to a
distribution plan. Shareowners of each class share all expenses and fees
paid to the transfer agent, Pioneer Investment Management Shareholder
Services, Inc. (PIMSS), for its services, which are allocated based on the
number of accounts in each class and the ratable allocation of related
out-of-pocket expenses (see Note 3). Income, common expenses and realized
and unrealized gains and losses are calculated at the Fund level and
allocated daily to each class of shares based on the respective percentage
of adjusted net assets at the beginning of the day.
Distributions to shareowners are recorded as of the ex-dividend date.
Distributions paid by the Fund with respect to each class of shares are
calculated in the same manner, at the same time, and in the same amount,
except that Class A, Class B, Class C and Investor Class shares can bear
different transfer agent and distribution fees.
G. Repurchase Agreements
With respect to repurchase agreements entered into by the Fund, the value
of the underlying securities (collateral), including accrued interest
received from counterparties, is required to be at least equal to or in
excess of the value of the repurchase agreement at the time of purchase.
The collateral for all repurchase agreements is held in safekeeping in the
customer-only account of the Fund's custodian, or subcustodians. The
Fund's investment adviser, Pioneer Investment Management, Inc. (PIM), is
responsible for determining that the value of the collateral remains at
least equal to the repurchase price.
44
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
H. Security Lending
The Fund lends securities in its portfolio to certain broker-dealers or
other institutional investors, with the Fund's custodian acting as the
lending agent. When entering into a loan, the Fund receives collateral,
which is maintained by the custodian and earns income in the form of
negotiated lenders' fees. The Fund also continues to receive interest or
payments in lieu of dividends on the securities loaned. Gain or loss in
the fair value of the loaned securities that may occur during the term of
the loan will be for the account of the Fund. The loans are secured by
collateral of at least 102%, at all times, of the fair value of the
securities loaned. The amount of the collateral will be adjusted daily to
reflect any price fluctuation in the value of the loaned securities. The
Fund has the right under the lending agreements to recover the securities
from the borrower on demand. The Fund invests cash collateral in interest
bearing bank deposits.
2. Management Agreement
PIM, a wholly owned indirect subsidiary of UniCredito Italiano, manages the
Fund's portfolio. Management fees are calculated daily at the annual rate of
0.65% of the Fund's average daily net assets up to $1 billion; 0.60% of the
next $4 billion; and 0.55% of the excess over $5 billion.
Through December 10, 2006, PIM has agreed not to impose all or a portion of its
management fee and to assume other operating expenses (excluding taxes,
commissions, interest and extraordinary expenses) of the Fund to the extent
necessary to limit Investor Class expenses to 1.10% of the average daily net
assets attributable to Investor Class shares.
In addition, under the management and administration agreements, certain other
services and costs, including accounting, regulatory reporting and insurance
premiums, are paid by the Fund. At June 30, 2006, $2,974 was payable to PIM
related to management fees, administrative costs and certain other services,
and is included in due to affiliates.
45
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 6/30/06 (unaudited) (continued)
- --------------------------------------------------------------------------------
3. Transfer Agent
PIMSS, a wholly owned subsidiary of UniCredito Italiano, provides substantially
all transfer agent and shareowner services to the Fund at negotiated rates.
Included in due to affiliates is $47,597 in transfer agent fees payable to
PIMSS at June 30, 2006.
4. Distribution Plans
The Fund adopted a Plan of Distribution for each class of shares (Class A Plan,
Class B Plan and Class C Plan) in accordance with Rule 12b-1 of the Investment
Company Act of 1940. Pursuant to the Class A Plan, the Fund pays PFD a service
fee of up to 0.25% of the average daily net assets attributable to Class A
shares in reimbursement of its actual expenditures to finance activities
primarily intended to result in the sale of Class A shares. Pursuant to the
Class B Plan and the Class C Plan, the Fund pays PFD 1.00% of the average daily
net assets attributable to each class of shares. The fee consists of a 0.25%
service fee and a 0.75% distribution fee paid as compensation for personal
services and/or account maintenance services or distribution services with
regard to Class B and Class C shares. Included in due to affiliates is $1,221
in distribution fees payable to PFD at June 30, 2006.
In addition, redemptions of each class of shares (except Investor Class shares)
may be subject to a contingent deferred sales charge (CDSC). A CDSC of 1.00%
may be imposed on redemptions of certain net asset value purchases of Class A
shares within 18 months of purchase. Class B shares subscribed on or after
December 1, 2004 that are redeemed within five years of purchase are subject to
a CDSC at declining rates beginning at 4.00%, based on the lower of cost or
market value of shares being redeemed. Shares purchased prior to December 1,
2004 remain subject to the CDSC in effect at the time those shares were
purchased. Redemptions of Class C shares within one year of purchase are
subject to a CDSC of 1.00%. Proceeds from the CDSCs are paid to PFD. For the
six months ended June 30, 2006, CDSCs in the amount of $18,708 were paid to
PFD.
5. Expense Offset Arrangements
The Fund has entered into certain expense offset arrangements with PIMSS
resulting in a reduction in the Fund's total expenses due to interest earned on
cash held by PIMSS. For the six months
46
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
ended June 30, 2006, the Fund's expenses were not reduced under such
arrangements.
6. Line of Credit Facility
The Fund, along with certain others in the Pioneer Family of Funds (the Funds),
collectively participate in a $50 million committed, unsecured revolving line
of credit facility. Borrowings are used solely for temporary or emergency
purposes. The Fund may borrow up to the lesser of $50 million or the limits set
by its prospectus for borrowings. Interest on collective borrowings is payable
at the Federal Funds Rate plus 1/2% on an annualized basis. The Funds pay an
annual commitment fee for this facility. The commitment fee is allocated among
such Funds based on their respective borrowing limits. For the six months ended
June 30, 2006, the Fund had no borrowings under this agreement.
7. Forward Foreign Currency Contracts
During the six months ended June 30, 2006, the Fund had entered into various
contracts that obligate the Fund to deliver currencies at specified future
dates. At the maturity of a contract, the Fund must make delivery of the
foreign currency. Alternatively, prior to the settlement date of a portfolio
hedge, the Fund may close out such contracts by entering into an offsetting
hedge contract. At June 30, 2006, the Fund had no outstanding settlement
hedges. The Fund's gross forward currency portfolio contracts receivable and
payable as of June 30, 2006 were $176,226 and $170,670, respectively, resulting
in a net receivable of $5,556.
8. Merger Information
On December 8, 2004, beneficial owners of Safeco Balanced Fund (one of the
series that comprised Safeco Common Stock Trust) approved a proposed Agreement
and Plan of Reorganization that provided for the merger listed below. This
tax-free reorganization was accomplished on December 10, 2004, by exchanging
all of Safeco's net assets for Investor Class shares, based on the Fund's Class
A shares' ending net asset value. The following charts show the details of the
reorganizations as of that closing date ("Closing Date"):
47
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 6/30/06 (unaudited) (continued)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------
Pioneer Safeco Pioneer
Balanced Fund Balanced Fund Balanced Fund
(Pre-Reorganization ) (Pre-Reorganization) (Post-Reorganization)
- --------------------------------------------------------------------------------------------------
Net Assets $131,213,704 $18,324,440 $149,538,144
Shares Outstanding 13,574,726 1,479,627 15,471,658
Investor Shares
Issued 1,896,932
- --------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------
Unrealized Accumulated
Appreciation/ Loss on
on Closing Date Closing Date
- --------------------------------------------------------------------------------------------------
Safeco Balanced Fund $2,484,884 $(483,521)
- --------------------------------------------------------------------------------------------------
ADDITIONAL INFORMATION (unaudited)
For the fiscal year ended December 31, 2005, the percentage of the ordinary
income distributions made by the Fund subject to a maximum tax rate of 15%, as
provided for by the Jobs and Growth Tax Relief Act of 2003, was 61.37%.
The qualifying percentage of the Fund's ordinary income dividends for the
purposes of the corporate dividends received deduction was 57.58%.
48
Pioneer Balanced Fund
- --------------------------------------------------------------------------------
TRUSTEES, OFFICERS AND SERVICE PROVIDERS
- --------------------------------------------------------------------------------
Trustees Officers
John F. Cogan, Jr., Chairman John F. Cogan, Jr., President
David R. Bock Osbert M. Hood, Executive
Mary K. Bush Vice President
Margaret B.W. Graham Vincent Nave, Treasurer
Osbert M. Hood Dorothy E. Bourassa, Secretary
Thomas J. Perna
Marguerite A. Piret
Stephen K. West
John Winthrop
Investment Adviser
Pioneer Investment Management, Inc.
Custodian
Brown Brothers Harriman & Co.
Principal Underwriter
Pioneer Funds Distributor, Inc.
Legal Counsel
Wilmer Cutler Pickering Hale and Dorr LLP
Shareowner Services and Transfer Agent
Pioneer Investment Management Shareholder Services, Inc.
Proxy Voting Policies and Procedures of the Fund are available without charge,
upon request, by calling our toll-free number (1-800-225-6292). Information
regarding how the Fund voted proxies relating to portfolio securities during
the most recent 12-month period ended June 30 is publicly available to
shareowners at www.pioneerinvestments.com. This information is also available
on the Securities and Exchange Commission's web site at http://www.sec.gov.
49
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This page for your notes.
50
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This page for your notes.
51
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52
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HOW TO CONTACT PIONEER
- --------------------------------------------------------------------------------
We are pleased to offer a variety of convenient ways for you to contact us for
assistance or information.
Call us for:
Account Information, including existing accounts,
new accounts, prospectuses, applications
and service forms 1-800-225-6292
FactFone(SM) for automated fund yields, prices,
account information and transactions 1-800-225-4321
Retirement plans information 1-800-622-0176
Telecommunications Device for the Deaf (TDD) 1-800-225-1997
Write to us:
PIMSS, Inc.
P.O. Box 55014
Boston, Massachusetts 02205-5014
Our toll-free fax 1-800-225-4240
Our internet e-mail address ask.pioneer@pioneerinvestments.com
(for general questions about Pioneer only)
Visit our web site: www.pioneerinvestments.com
Before investing consider the Fund's investment objectives, risks, charges and
expenses. Contact your advisor or Pioneer Investments for a prospectus
containing this information. Read it carefully.
The Fund files a complete statement of investments with the Securities and
Exchange Commission for the first and third quarters for each fiscal year on
Form N-Q. Shareholders may view the filed Form N-Q by visiting the
Commission's web site at http://www.sec.gov. The filed form may also be viewed
and copied at the Commission's Public Reference Room in Washington, DC.
Information regarding the operations of the Public Reference Room may be
obtained by calling 1-800-SEC-0330.
ITEM 2. CODE OF ETHICS.
(a) Disclose whether, as of the end of the period covered by the report, the
registrant has adopted a code of ethics that applies to the registrant's
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 registrant or a third party. If
the registrant has not adopted such a code of ethics, explain why it has not
done so.
The registrant has adopted, as of the end of the period covered by this report,
a code of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer and controller.
(b) For purposes of this Item, the term "code of ethics" means written standards
that are reasonably designed to deter wrongdoing and to promote:
(1) Honest and ethical conduct, including the ethical handling of actual
or apparent conflicts of interest between personal and professional
relationships;
(2) Full, fair, accurate, timely, and understandable disclosure in
reports and documents that a registrant files with, or submits to, the
Commission and in other public communications made by the registrant;
(3) Compliance with applicable governmental laws, rules, and
regulations;
(4) The prompt internal reporting of violations of the code to an
appropriate person or persons identified in the code; and
(5) Accountability for adherence to the code.
(c) The registrant must briefly describe the nature of any amendment, during the
period covered by the report, to a provision of its code of ethics that applies
to the registrant's 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
registrant or a third party, and that relates to any element of the code of
ethics definition enumerated in paragraph (b) of this Item. The registrant must
file a copy of any such amendment as an exhibit pursuant to Item 10(a), unless
the registrant has elected to satisfy paragraph (f) of this Item by posting its
code of ethics on its website pursuant to paragraph (f)(2) of this Item, or by
undertaking to provide its code of ethics to any person without charge, upon
request, pursuant to paragraph (f)(3) of this Item.
The registrant has made no amendments to the code of ethics during the period
covered by this report.
(d) If the registrant has, during the period covered by the report, granted a
waiver, including an implicit waiver, from a provision of the code of ethics to
the registrant's 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
registrant or a third party, that relates to one or more of the items set forth
in paragraph (b) of this Item, the registrant must briefly describe the nature
of the waiver, the name of the person to whom the waiver was granted, and the
date of the waiver.
Not applicable.
(e) If the registrant intends to satisfy the disclosure requirement under
paragraph (c) or (d) of this Item regarding an amendment to, or a waiver from,
a provision of its code of ethics that applies to the registrant's principal
executive officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions and that relates to any
element of the code of ethics definition enumerated in paragraph (b) of this
Item by posting such information on its Internet website, disclose the
registrant's Internet address and such intention.
Not applicable.
(f) The registrant must:
(1) File with the Commission, pursuant to Item 10(a), a copy of its code
of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer or controller,
or persons performing similar functions, as an exhibit to its annual
report on this Form N-CSR;
(2) Post the text of such code of ethics on its Internet website and
disclose, in its most recent report on this Form N-CSR, its Internet
address and the fact that it has posted such code of ethics on its
Internet website; or
(3) Undertake in its most recent report on this Form N-CSR to provide to
any person without charge, upon request, a copy of such code of ethics
and explain the manner in which such request may be made.
See Item 10(2)
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a) (1) Disclose that the registrant's board of trustees has determined that
the registrant either:
(i) Has at least one audit committee financial expert serving on its audit
committee; or
(ii) Does not have an audit committee financial expert serving on its audit
committee.
The registrant's Board of Trustees has determined that the registrant has at
least one audit committee financial expert.
(2) If the registrant provides the disclosure required by paragraph
(a)(1)(i) of this Item, it must disclose the name of the audit committee
financial expert and whether that person is "independent." In order to be
considered "independent" for purposes of this Item, a member of an audit
committee may not, other than in his or her capacity as a member of the audit
committee, the board of trustees, or any other board committee:
(i) Accept directly or indirectly any consulting, advisory, or other
compensatory fee from the issuer; or
(ii) Be an "interested person" of the investment company as defined in
Section 2(a)(19) of the Act (15 U.S.C. 80a-2(a)(19)).
Ms. Marguerite A. Piret, an independent trustee, is such an audit committee
financial expert.
(3) If the registrant provides the disclosure required by paragraph (a)(1)
(ii) of this Item, it must explain why it does not have an audit committee
financial expert.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Disclose, under the caption AUDIT FEES, the aggregate fees billed for each
of the last two fiscal years for professional services rendered by the principal
accountant for the audit of the registrant's annual financial statements or
services that are normally provided by the accountant in connection with
statutory and regulatory filings or engagements for those fiscal years.
N/A
(b) Disclose, under the caption AUDIT-RELATED FEES, the aggregate fees billed in
each of the last two fiscal years for assurance and related services by the
principal accountant that are reasonably related to the performance of the audit
of the registrant's financial statements and are not reported under
paragraph (a) of this Item. Registrants shall describe the nature of the
services comprising the fees disclosed under this category.
N/A
(c) Disclose, under the caption TAX FEES, the aggregate fees billed in each of
the last two fiscal years for professional services rendered by the principal
accountant for tax compliance, tax advice, and tax planning. Registrants shall
describe the nature of the services comprising the fees disclosed under this
category.
N/A
(d) Disclose, under the caption ALL OTHER FEES, the aggregate fees billed in
each of the last two fiscal years for products and services provided by the
principal accountant, other than the services reported in paragraphs (a) through
(c) of this Item. Registrants shall describe the nature of the services
comprising the fees disclosed under this category.
N/A
(e) (1) Disclose the audit committee's pre-approval policies and procedures
described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.
PIONEER FUNDS
APPROVAL OF AUDIT, AUDIT-RELATED, TAX AND OTHER SERVICES
PROVIDED BY THE INDEPENDENT AUDITOR
SECTION I - POLICY PURPOSE AND APPLICABILITY
The Pioneer Funds recognize the importance of maintaining the independence of
their outside auditors. Maintaining independence is a shared responsibility
involving Pioneer Investment Management, Inc ("PIM"), the audit committee and
the independent auditors.
The Funds recognize that a Fund's independent auditors: 1) possess knowledge of
the Funds, 2) are able to incorporate certain services into the scope of the
audit, thereby avoiding redundant work, cost and disruption of Fund personnel
and processes, and 3) have expertise that has value to the Funds. As a result,
there are situations where it is desirable to use the Fund's independent
auditors for services in addition to the annual audit and where the potential
for conflicts of interests are minimal. Consequently, this policy, which is
intended to comply with Rule 210.2-01(C)(7), sets forth guidelines and
procedures to be followed by the Funds when retaining the independent audit firm
to perform audit, audit-related tax and other services under those
circumstances, while also maintaining independence.
Approval of a service in accordance with this policy for a Fund shall also
constitute approval for any other Fund whose pre-approval is required pursuant
to Rule 210.2-01(c)(7)(ii).
In addition to the procedures set forth in this policy, any non-audit services
that may be provided consistently with Rule 210.2-01 may be approved by the
Audit Committee itself and any pre-approval that may be waived in accordance
with Rule 210.2-01(c)(7)(i)(C) is hereby waived.
Selection of a Fund's independent auditors and their compensation shall be
determined by the Audit Committee and shall not be subject to this policy.
SECTION II - POLICY
- ---------------- -------------------------------- -------------------------------------------------
SERVICE SERVICE CATEGORY DESCRIPTION SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
CATEGORY
- ---------------- -------------------------------- -------------------------------------------------
I. AUDIT Services that are directly o Accounting research assistance
SERVICES related to performing the o SEC consultation, registration
independent audit of the Funds statements, and reporting
o Tax accrual related matters
o Implementation of new accounting
standards
o Compliance letters (e.g. rating agency
letters)
o Regulatory reviews and assistance
regarding financial matters
o Semi-annual reviews (if requested)
o Comfort letters for closed end
offerings
- ---------------- -------------------------------- -------------------------------------------------
II. Services which are not o AICPA attest and agreed-upon procedures
AUDIT-RELATED prohibited under Rule o Technology control assessments
SERVICES 210.2-01(C)(4) (the "Rule") o Financial reporting control assessments
and are related extensions of o Enterprise security architecture
the audit services support the assessment
audit, or use the
knowledge/expertise gained
from the audit procedures as a
foundation to complete the
project. In most cases, if
the Audit-Related Services are
not performed by the Audit
firm, the scope of the Audit
Services would likely
increase. The Services are
typically well-defined and
governed by accounting
professional standards (AICPA,
SEC, etc.)
- ---------------- -------------------------------- -------------------------------------------------
------------------------------------- ------------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the audit period for all services and related fees
pre-approved specific service reported at each regularly
subcategories. Approval of the scheduled Audit Committee
independent auditors as meeting.
auditors for a Fund shall
constitute pre approval for
these services.
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the fund fiscal year within services and related fees
a specified dollar limit (including comparison to
for all pre-approved specified dollar limits)
specific service subcategories reported quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limit for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for Audit-Related
Services not denoted as
"pre-approved", or
to add a specific service
subcategory as "pre-approved"
------------------------------------- ------------------------------------
SECTION III - POLICY DETAIL, CONTINUED
- ----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
- ----------------------- --------------------------- -----------------------------------------------
III. TAX SERVICES Services which are not o Tax planning and support
prohibited by the Rule, o Tax controversy assistance
if an officer of the Fund o Tax compliance, tax returns, excise
determines that using the tax returns and support
Fund's auditor to provide o Tax opinions
these services creates
significant synergy in
the form of efficiency,
minimized disruption, or
the ability to maintain a
desired level of
confidentiality.
- ----------------------- --------------------------- -----------------------------------------------
- ------------------------------------- -------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
- ------------------------------------- -------------------------
- ------------------------------------- -------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year all such services and
within a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for tax services not
denoted as pre-approved, or to add a specific
service subcategory as
"pre-approved"
- ------------------------------------- -------------------------
SECTION III - POLICY DETAIL, CONTINUED
- ----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
- ----------------------- --------------------------- -----------------------------------------------
IV. OTHER SERVICES Services which are not o Business Risk Management support
prohibited by the Rule, o Other control and regulatory
A. SYNERGISTIC, if an officer of the Fund compliance projects
UNIQUE QUALIFICATIONS determines that using the
Fund's auditor to provide
these services creates
significant synergy in
the form of efficiency,
minimized disruption,
the ability to maintain a
desired level of
confidentiality, or where
the Fund's auditors
posses unique or superior
qualifications to provide
these services, resulting
in superior value and
results for the Fund.
- ----------------------- --------------------------- -----------------------------------------------
- --------------------------------------- ------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
- ------------------------------------- --------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year within all such services and
a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for "Synergistic" or
"Unique Qualifications" Other
Services not denoted as
pre-approved to the left, or to
add a specific service
subcategory as "pre-approved"
- ------------------------------------- --------------------------
SECTION III - POLICY DETAIL, CONTINUED
- ----------------------- ------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PROHIBITED SERVICE SUBCATEGORIES
DESCRIPTION
- ----------------------- ------------------------- -----------------------------------------------
PROHIBITED SERVICES Services which result 1. Bookkeeping or other services
in the auditors losing related to the accounting records or
independence status financial statements of the audit
under the Rule. client*
2. Financial information systems design
and implementation*
3. Appraisal or valuation services,
fairness* opinions, or
contribution-in-kind reports
4. Actuarial services (i.e., setting
actuarial reserves versus actuarial
audit work)*
5. Internal audit outsourcing services*
6. Management functions or human
resources
7. Broker or dealer, investment
advisor, or investment banking services
8. Legal services and expert services
unrelated to the audit
9. Any other service that the Public
Company Accounting Oversight Board
determines, by regulation, is
impermissible
- ----------------------- ------------------------- -----------------------------------------------
- ------------------------------------------- ------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
- ------------------------------------------- ------------------------------
o These services are not to be o A summary of all
performed with the exception of the(*) services and related
services that may be permitted fees reported at each
if they would not be subject to audit regularly scheduled
procedures at the audit client (as Audit Committee meeting
defined in rule 2-01(f)(4)) level will serve as continual
the firm providing the service. confirmation that has
not provided any
restricted services.
- ------------------------------------------- ------------------------------
- --------------------------------------------------------------------------------
GENERAL AUDIT COMMITTEE APPROVAL POLICY:
o For all projects, the officers of the Funds and the Fund's auditors will each
make an assessment to determine that any proposed projects will not impair
independence.
o Potential services will be classified into the four non-restricted service
categories and the "Approval of Audit, Audit-Related, Tax and Other
Services" Policy above will be applied. Any services outside the specific
pre-approved service subcategories set forth above must be specifically
approved by the Audit Committee.
o At least quarterly, the Audit Committee shall review a report summarizing the
services by service category, including fees, provided by the Audit firm as
set forth in the above policy.
- --------------------------------------------------------------------------------
(2) Disclose the percentage of services described in each of paragraphs (b)
through (d) of this Item that were approved by the audit committee pursuant
to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
N/A
(f) If greater than 50 percent, disclose the percentage of hours expended on the
principal accountant's engagement to audit the registrant's financial statements
for the most recent fiscal year that were attributed to work performed by
persons other than the principal accountant's full-time, permanent employees.
N/A
(g) Disclose the aggregate non-audit fees billed by the registrant's accountant
for services rendered to the registrant, and rendered to the registrant's
investment adviser (not including any sub-adviser whose role is primarily
portfolio management and is subcontracted with or overseen by another investment
adviser), and any entity controlling, controlled by, or under common control
with the adviser that provides ongoing services to the registrant for each of
the last two fiscal years of the registrant.
N/A
(h) Disclose whether the registrant's audit committee of the board of trustees
has considered whether the provision of non-audit services that were rendered to
the registrant's investment adviser (not including any subadviser whose role is
primarily portfolio management and is subcontracted with or overseen by another
investment adviser), and any entity controlling, controlled by, or under common
control with the investment adviser that provides ongoing services to the
registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of
Rule 2-01 of Regulation S-X is compatible with maintaining the principal
accountant's independence.
The Fund's independent auditor, Ernst &
Young LLP ("E&Y"), has advised the Audit
Committee of the Fund's Board of Trustees that
E&Ys Spanish affiliate (E&Y Spain) performed
certain non-audit work for Pioneer Global
Investments Limited ("PGIL"), an affiliate of the
Funds investment adviser. The services involved
the receipt and disbursement of monies transferred
to E&Y Spain by PGIL in payment of individual
payroll and related income tax withholdings due on
returns prepared by E&Y Spain for certain PGIL
employees located in Spain from February 2001 to
October 2005. E&Y became auditors of the Fund in
May 2002. These payroll and tax services were
discontinued in November 2005. The annual fee
received by E&Y Spain for all such services totaled
approximately 9,000 Euro per year. E&Y has informed
the Audit Committee that based on its internal
reviews and the de minimus nature of the services
provided and fees received, E&Y does not believe
its independence with respect to the Fund has been
impaired or that it is disqualified from acting as
independent auditors to the Fund.
N/A
Item 5. Audit Committee of Listed Registrants
(a) If the registrant is a listed issuer as defined in Rule 10A-3
under the Exchange Act (17 CFR 240.10A-3), state whether
or not the registrant has a separately-designated standing
audit committee established in accordance with Section
3(a)(58)(A) of the Exchange Act (15 U.S.C. 78c(a)(58)(A)).
If the registrant has such a committee, however designated,
identify each committee member. If the entire board of directors
is acting as the registrants audit committee as specified in
Section 3(a)(58)(B) of the Exchange Act (15 U.S.C. 78c(a)(58)(B)),
so state.
N/A
(b) If applicable, provide the disclosure required by Rule 10A-3(d)
under the Exchange Act (17 CFR 240.10A-3(d)) regarding an exemption
from the listing standards for audit committees.
N/A
Item 6. Schedule of Investments.
File Schedule I Investments in securities of unaffiliated issuers
as of the close of the reporting period as set forth in 210.12-
12 of Regulation S-X [17 CFR 210.12-12], unless the schedule is
included as part of the report to shareholders filed under Item
1 of this Form.
Included in Item 1
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR
CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
A closed-end management investment company that is filing an annual report on
this Form N-CSR must, unless it invests exclusively in non-voting securities,
describe the policies and procedures that it uses to determine how to vote
proxies relating to portfolio securities, including the procedures that the
company uses when a vote presents a conflict between the interests of its
shareholders, on the one hand, and those of the company's investment adviser;
principal underwriter; or any affiliated person (as defined in Section 2(a)(3)
of the Investment Company Act of 1940 (15 U.S.C. 80a-2(a)(3)) and the rules
thereunder) of the company, its investment adviser, or its principal
underwriter, on the other. Include any policies and procedures of the company's
investment adviser, or any other third party, that the company uses, or that are
used on the company's behalf, to determine how to vote proxies relating to
portfolio securities.
Not applicable to open-end management investment companies.
Item 8. Portfolio Managers of Closed-End Management Investment
Companies.
(a) If the registrant is a closed-end management investment company that
is filing an annual report on this Form N-CSR,provide the following
information:
(1) State the name, title, and length of service of the person or persons
employed by or associated with the registrant or an investment adviser
of the registrant who are primarily responsible for the day-to-day management
of the registrants portfolio (Portfolio Manager). Also state each Portfolio
Managers business experience during the past 5 years.
Not applicable to open-end management investment companies.
Item 9. Purchases of Equity Securities by Closed-End Management
Investment Company and Affiliated Purchasers.
(a) If the registrant is a closed-end management investment company,
in the following tabular format, provide the information specified in
paragraph (b) of this Item with respect to any purchase made by or on
behalf of the registrant or any affiliated purchaser, as defined in
Rule 10b-18(a)(3) under the Exchange Act (17 CFR 240.10b-18(a)(3)), of
shares or other units of any class of the registrants equity securities
that is registered by the registrant pursuant to Section 12 of the
Exchange Act (15 U.S.C. 781). Instruction to paragraph (a). Disclose
all purchases covered by this Item, including purchases that do not
satisfy the conditions of the safe harbor of Rule 10b-18 under the
Exchange Act (17 CFR 240.10b-18), made in the period covered by the
report. Provide disclosures covering repurchases made on a monthly basis.
For example, if the reporting period began on January 16 and ended on
July 15, the chart would show repurchases for the months from January 16
through February 15, February 16 through March 15, March 16 through
April 15, April 16 through May 15, May 16 through June 15, and June 16
through July 15.
Not applicable to open-end management investment companies.
Item 10. Submission of Matters to a Vote of Security Holders.
Describe any material changes to the procedures by which shareholders
may recommend nominees to the registrants board of directors, where
those changes were implemented after the registrant last provided
disclosure in response to the requirements of Item 7(d)(2)(ii)(G)
of Schedule 14A (17 CFR 240.14a-101), or this Item.
There have been no material changes to the procedures by which the
shareholders may recommend nominees to the registrants board of
directors since the registrant last provided disclosure in response
to the requirements of Item 7(d)(2)(ii)(G) of Schedule 14(A) in
its definitive proxy statement, or this Item.
ITEM 11. CONTROLS AND PROCEDURES.
(a) Disclose the conclusions of the registrant's principal executive officer or
officers and principal financial officer or officers, or persons performing
similar functions, about the effectiveness of the registrant's disclosure
controls and procedures (as defined in Rule 30a-2(c) under the Act (17 CFR
270.30a-2(c))) based on their evaluation of these controls and procedures as of
a date within 90 days of the filing date of the report that includes the
disclosure required by this paragraph.
The registrant's principal executive officer and principal financial
officer have concluded, that the registrant's disclosure controls and
procedures are effective based on their evaluation of these controls and
procedures as of a date within 90 days of the filing date of this report.
(b) Disclose whether or not there were significant changes in the registrant's
internal controls or in other factors that could significantly affect these
controls subsequent to the date of their evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
There were no significant changes in the registrant's internal controls or
in other factors that could significantly affect these controls subsequent to
the date of their evaluation, including any corrective actions with regard
to significant deficiencies and material weaknesses.
ITEM 12. EXHIBITS.
File the exhibits listed below as part of this Form. Letter or number the
exhibits in the sequence indicated.
(a) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit.
(b) A separate certification for each principal executive officer and principal
financial officer of the registrant as required by Rule 30a-2 under the Act
(17 CFR 270.30a-2).
Filed herewith.
SIGNATURES
[See General Instruction F]
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Pioneer Balanced Fund
By (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr, President
Date August 31, 2006
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr., President
Date August 31, 2006
By (Signature and Title)* /s/ Vincent Nave
Vincent Nave, Treasurer
Date August 31, 2006
* Print the name and title of each signing officer under his or her signature.