OMB APPROVAL
OMB Number: 3235-0570
Expires: November 30, 2005
Estimated average burden
hours per response..... 5.0
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 811-07611
Pioneer Value 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: September 30
Date of reporting period: October 1, 2003 through September 30, 2004
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.
PIONEER
-------
VALUE
FUND
Annual
Report
9/30/04
{LOGO] PIONEER
Investments
Table of Contents
- --------------------------------------------------------------------------------
Letter to Shareowners 1
Portfolio Summary 2
Performance Update 3
Comparing Ongoing Fund Expenses 8
Portfolio Management Discussion 10
Schedule of Investments 13
Financial Statements 20
Notes to Financial Statements 29
Report of Independent Registered Public Accounting Firm 37
The Pioneer Family of Mutual Funds 38
Trustees, Officers and Service Providers 39
Pioneer Value Fund
- --------------------------------------------------------------------------------
LETTER TO SHAREOWNERS 9/30/04
- --------------------------------------------------------------------------------
Dear Shareowners,
- --------------------------------------------------------------------------------
High energy prices and rising interest rates caused concern among investors
during the third quarter of 2004. As oil prices touched $50 per barrel for the
first time, many consumers, faced with high priced gasoline and anticipating a
winter of hefty heating bills, responded by holding back on spending. Consumers
account for the bulk of the nation's economic activity, and retail sales over
the summer were erratic. Beyond soaring energy costs, which have the effect of a
tax increase on individuals and businesses, the slack job creation data of the
last few months also undermined confidence in the economic outlook. The markets
in general fell during the third quarter. Continued unsettled conditions in Iraq
and the ever present specter of terrorism also weighed on investors' minds.
Overseas, global markets were fairly stable, after stumbling earlier in the
year.
But the fuzzy economic picture was good news for bond investors. Despite three
hikes in short-term interest rates, the first increases in four years, bond
prices rose and yields fell over the period. Longer-term Treasury securities
were the strongest performers, with corporate bonds, including high-yield
issues, also delivering favorable returns. Lower long-term rates were also
beneficial to the housing and mortgage industries. Behind the rally in bonds
lies investor skepticism about the strength and durability of the current
economic recovery. A slowing recovery leading to an easing of inflationary
pressures may convince the Federal Reserve Board to slow the pace of future rate
increases. Less inflation would also mean better real returns for bond holders.
Pioneer believes that the economy will continue to expand in 2005, but at a more
measured tempo. After an extended period of cutting costs and bolstering balance
sheets, many corporations are financially stronger than they have been in some
time. And although short-term interest rates have risen, they are still
relatively low and do not appear to be a barrier for companies needing to borrow
for expansion. Equity valuations now appear better aligned with earnings
prospects than was the case a year ago, when prices ran ahead of profit
expectations. Therefore, steady but moderate expansion in corporate profits has
the potential to drive stock prices higher.
A one-step approach to portfolio allocation
Building and maintaining a long-term strategy for your portfolio means deciding
on an appropriate mix of investments, then adjusting the weightings as time
passes and your goals change. The Pioneer Ibbotson Asset Allocation Series is a
family of three portfolios - moderate, growth and aggressive - each comprising a
select group of Pioneer Funds. Ibbotson Associates, a leading authority on
investing and asset allocation, diversifies, reallocates and automatically
rebalances the portfolios periodically. By rebalancing the portfolio as rates of
return on stocks, bonds and other investments vary, Ibbotson seeks to manage
risk and to keep your holdings in line with the Fund's stated goals.
Please consider a fund's investment objective, risks, charges and expenses
carefully before investing. The prospectus contains this and other information
about each fund and should be read carefully before you invest or send money. To
obtain a prospectus and for other information on any Pioneer fund, contact your
financial advisor, call 1-800-225-6292 or visit our web site at
www.pioneerfunds.com.
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.
1
Pioneer Value Fund
- --------------------------------------------------------------------------------
PORTFOLIO SUMMARY 9/30/04
- --------------------------------------------------------------------------------
Portfolio Diversification
- --------------------------------------------------------------------------------
(As a percentage of total investment portfolio)
[THE FOLLOWING DATA WAS REPRESENTED BY A PIE CHART IN THE ORIGINAL DOCUMENT.]
U.S. Common Stocks 88.7%
Depositary Receipts for International Stocks 5.5%
Temporary Cash Investments 4.1%
International Common Stocks 1.7%
Sector Distribution
- --------------------------------------------------------------------------------
(As a percentage of equity holdings)
[THE FOLLOWING DATA WAS REPRESENTED BY A PIE CHART IN THE ORIGINAL DOCUMENT.]
Financials 33.9%
Energy 12.7%
Industrials 11.7%
Consumer Discretionary 8.9%
Information Technology 8.6%
Health Care 6.4%
Telecommunication Services 5.9%
Consumer Staples 5.8%
Materials 4.9%
Utilities 1.2%
10 Largest Holdings
- --------------------------------------------------------------------------------
(As a percentage of equity holdings)*
1. Bank of America Corp. 5.26% 6. ConocoPhillips 2.27%
2. Citigroup, Inc. 5.04 7. Time Warner, Inc. 2.25
3. Freddie Mac 3.66 8. First Data Corp. 2.20
4. HCA, Inc. 2.40 9. Hewlett-Packard Co. 2.16
5. United Technologies Corp. 2.30 10. Berkshire Hathaway, Inc. 2.14
*This list excludes money market and derivative instruments. The portfolio is
actively managed, and current holdings may be different.
2
Pioneer Value Fund
- --------------------------------------------------------------------------------
PERFORMANCE UPDATE 9/30/04 CLASS A SHARES
- --------------------------------------------------------------------------------
Share Prices and Distributions
- --------------------------------------------------------------------------------
Net Asset Value per Share 9/30/04 9/30/03
$18.83 $16.25
Net
Distributions per Share Investment Short-Term Long-Term
(10/1/03 - 9/30/04) Income Capital Gains Capital Gains
$0.1383 $ -- $0.0404
Investment Returns
- --------------------------------------------------------------------------------
The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Value Fund at public offering price, compared to that
of the Russell 1000 Value Index.
Average Annual Total Returns
(As of September 30, 2004)
Net Asset Public Offering
Period Value Price (POP)
10 Years 7.80% 7.16%
5 Years 4.88 3.64
1 Year 17.04 10.32
[THE FOLLOWING DATA WAS REPRESENTED BY A MOUNTAIN CHART IN THE ORIGINAL
DOCUMENT.]
Value of $10,000 Investment
Date Pioneer Value Russell 1000
Fund Value Index
9/30/1994 $9,425 $10,000
$11,303 $12,771
9/30/1996 $12,680 $15,063
$18,507 $21,435
9/30/1998 $14,071 $22,208
$15,741 $26,366
9/30/2000 $18,306 $28,717
$16,681 $26,157
9/30/2002 $13,882 $21,724
$17,066 $27,019
9/30/2004 $19,974 $32,560
Call 1-800-225-6292 or visit www.pioneerfunds.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. POP
returns reflect deduction of maximum 5.75% 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 and can be rescinded at any time. See the
prospectus and financial statements for complete details.
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 Russell 1000 Value Index is a measure of the performance of the
value-oriented stocks in the Russell 1000 Index. Index returns assume
reinvestment of dividends and, unlike Fund returns, do not reflect any fees,
expenses or sales charges. You cannot invest directly in any index.
3
Pioneer Value Fund
- --------------------------------------------------------------------------------
PERFORMANCE UPDATE 9/30/04 CLASS B SHARES
- --------------------------------------------------------------------------------
Share Prices and Distributions
- --------------------------------------------------------------------------------
Net Asset Value per Share 9/30/04 9/30/03
$17.87 $15.45
Net
Distributions per Share Investment Short-Term Long-Term
(10/1/03 - 9/30/04) Income Capital Gains Capital Gains
$ -- $ -- $0.0404
Investment Returns
- --------------------------------------------------------------------------------
The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Value Fund, compared to that of the Russell 1000
Value Index.
Average Annual Total Returns
(As of September 30, 2004)
If If
Period Held Redeemed
Life-of-Class
(7/1/96) 4.73% 4.73%
5 Years 3.66 3.50
1 Year 15.95 11.95
[THE FOLLOWING DATA WAS REPRESENTED BY A MOUNTAIN CHART IN THE ORIGINAL
DOCUMENT.]
Value of $10,000 Investment
Date Pioneer Value Russell 1000
Fund Value Index
7/31/1996 $10,000 $10,000
$10,926 $10,695
$15,797 $15,220
9/30/1998 $11,886 $15,769
$13,149 $18,721
9/30/2000 $15,097 $20,391
$13,611 $18,573
9/30/2002 $11,205 $15,425
$13,570 $19,185
9/30/2004 $15,735 $23,116
Call 1-800-225-6292 or visit www.pioneerfunds.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 redeemed" returns reflect deduction of applicable CDSC. The maximum CDSC is
4% and declines over six years. 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 and can be rescinded at any time. See the
prospectus and financial statements for complete details.
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 Russell 1000 Value Index is a measure of the performance of the
value-oriented stocks in the Russell 1000 Index. Index returns assume
reinvestment of dividends and, unlike Fund returns, do not reflect any fees,
expenses or sales charges. You cannot invest directly in any index.
4
Pioneer Value Fund
- --------------------------------------------------------------------------------
PERFORMANCE UPDATE 9/30/04 CLASS C SHARES
- --------------------------------------------------------------------------------
Share Prices and Distributions
- --------------------------------------------------------------------------------
Net Asset Value per Share 9/30/04 9/30/03
$17.87 $15.49
Net
Distributions per Share Investment Short-Term Long-Term
(10/1/03 - 9/30/04) Income Capital Gains Capital Gains
$ -- $ -- $0.0404
Investment Returns
- --------------------------------------------------------------------------------
The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Value Fund at public offering price, compared to that
of the Russell 1000 Value Index.
Average Annual Total Returns
(As of September 30, 2004)
If If
Period Held Redeemed
Life-of-Class
(7/1/96) 4.73% 4.73%
5 Years 3.63 3.63
1 Year 15.66 15.66
[THE FOLLOWING DATA WAS REPRESENTED BY A MOUNTAIN CHART IN THE ORIGINAL
DOCUMENT.]
Value of $10,000 Investment
Date Pioneer Value Russell 1000
Fund Value Index
7/31/1996 $10,000 $10,000
$10,921 $10,695
$15,781 $15,220
9/30/1998 $11,904 $15,769
$13,166 $18,721
9/30/2000 $15,119 $20,391
$13,610 $18,573
9/30/2002 $11,190 $15,425
$13,607 $19,185
9/30/2004 $15,737 $23,116
Call 1-800-225-6292 or visit www.pioneerfunds.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. 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 and can be rescinded at any time. See the
prospectus and financial statements for complete details.
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 Russell 1000 Value Index is a measure of the performance of the
value-oriented stocks in the Russell 1000 Index. Index returns assume
reinvestment of dividends and, unlike Fund returns, do not reflect any fees,
expenses or sales charges. You cannot invest directly in any index.
5
Pioneer Value Fund
- --------------------------------------------------------------------------------
PERFORMANCE UPDATE 9/30/04 CLASS R SHARES
- --------------------------------------------------------------------------------
Share Prices and Distributions
- --------------------------------------------------------------------------------
Net Asset Value per Share 9/30/04 9/30/03
$18.64 $16.24
Net
Distributions per Share Investment Short-Term Long-Term
(10/1/03 - 9/30/04) Income Capital Gains Capital Gains
$0.0917 $ -- $0.0404
Investment Returns
- --------------------------------------------------------------------------------
The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Value Fund at public offering price, compared to that
of the Russell 1000 Value Index.
Average Annual Total Returns
(As of September 30, 2004)
If If
Period Held Redeemed
10 Years 7.21% 7.21%
5 Years 4.25 4.25
1 Year 15.64 15.64
[THE FOLLOWING DATA WAS REPRESENTED BY A MOUNTAIN CHART IN THE ORIGINAL
DOCUMENT.]
Value of $10,000 Investment
Date Pioneer Value Russell 1000
Fund Value Index
9/30/1994 $10,000 $10,000
$11,932 $12,771
9/30/1996 $13,318 $15,063
$19,341 $21,435
9/30/1998 $14,631 $22,208
$16,286 $26,366
9/30/2000 $18,845 $28,717
$17,086 $26,157
9/30/2002 $14,146 $21,724
$17,337 $27,019
9/30/2004 $20,048 $32,560
Call 1-800-225-6292 or visit www.pioneerfunds.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.
The performance of Class R shares for the period prior to the commencement of
operations of Class R shares on 4/1/03 is based on the performance of Class A
shares, reduced to reflect the higher distribution and service fees of Class R
shares. For the period after April 1, 2003, the actual performance of Class R
shares is reflected, which performance may be influenced by the smaller asset
size of Class R shares compared to Class A shares. 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 and can be rescinded at any time. See the
prospectus and financial statements for complete details.
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 Russell 1000 Value Index is a measure of the performance of the
value-oriented stocks in the Russell 1000 Index. Index returns assume
reinvestment of dividends and, unlike Fund returns, do not reflect any fees,
expenses or sales charges. You cannot invest directly in any index.
6
Pioneer Value Fund
- --------------------------------------------------------------------------------
PERFORMANCE UPDATE 9/30/04 CLASS Y SHARES
- --------------------------------------------------------------------------------
Share Prices and Distributions
- --------------------------------------------------------------------------------
Net Asset Value per Share 9/30/04 8/11/04
$16.84 $18.16
Net
Distributions per Share Investment Short-Term Long-Term
(8/11/04 - 9/30/04) Income Capital Gains Capital Gains
$ -- $ -- $ --
Investment Returns
- --------------------------------------------------------------------------------
The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Value Fund, compared to that of the Russell 1000
Value Index.
Average Annual Total Returns
(As of September 30, 2004)
If If
Period Held Redeemed
10 Years 7.80% 7.80%
5 Years 4.89 4.89
1 Year 17.10 17.10
[THE FOLLOWING DATA WAS REPRESENTED BY A MOUNTAIN CHART IN THE ORIGINAL
DOCUMENT.]
Value of $10,000 Investment
Date Pioneer Value Russell 1000
Fund Value Index
8/31/2004 $10,000 $10,000
9/30/2004 $10,107 $10,155
Call 1-800-225-6292 or visit www.pioneerfunds.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.
Performance for periods prior to the inception of Y shares reflects the NAV
performance of the Fund's A shares. The performance does not reflect differences
in expenses, including the Rule 12b-1 fees applicable to Class A shares. Since
fees for Class A shares are generally higher than those of Class Y shares, the
performance shown for Y shares prior to their inception would have been higher.
Class Y shares are not subject to sales charges and are available for limited
groups of eligible investors, including institutional investors. 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 and can be rescinded at any time. See the
prospectus and financial statements for complete details.
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 Russell 1000 Value Index is a measure of the performance of the
value-oriented stocks in the Russell 1000 Index. Index returns assume
reinvestment of dividends and, unlike Fund returns, do not reflect any fees,
expenses or sales charges. You cannot invest directly in any index.
7
Pioneer Value 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 Value Fund
Based on actual returns from April 1, 2004 through September 30, 2004
Share Class A B C R Y
- ---------------------------------------------------------------------------------------
Beginning Account $1,000.00 $1,000.00 $1,000.00 $1,000.00 $1,000.00
Value On 4/1/04
(8/11/04 for Class Y)
Ending Account $1,009.14 $1,005.64 $1,003.38 $ 998.53 $1,037.40
Value On 9/30/04
Expenses Paid During $ 4.90 $ 7.89 $ 10.60 $ 20.59 $ 0.87
Period*
* Expenses are equal to the Fund's annualized expense ratio of 0.97%, 1.57%,
2.12%, 4.12%, and 0.61% for Classes A, B, C, R and Y, respectively,
multiplied by the average account value over the period, multiplied by
183/366 (to reflect the one-half year period), (51/366 for Class Y.)
8
Pioneer Value Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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). 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 Value Fund
Based on a hypothetical 5% per year return before expenses, reflecting the
period from April 1, 2004 through September 30, 2004
Share Class A B C R Y
- ----------------------------------------------------------------------------------------
Beginning Account $1,000.00 $1,000.00 $1,000.00 $1,000.00 $1,000.00
Value On 4/1/04
(8/11/04 for Class Y)
Ending Account Value $1,019.90 $1,015.55 $1,014.00 $1,011.15 $1,006.12
On 9/30/04
Expenses Paid During $ 4.92 $ 7.93 $ 10.65 $ 20.72 $ 0.85
Period*
* Expenses are equal to the Fund's annualized expense ratio of 0.97%, 1.57%,
2.12%, 4.12%, and 0.61% for Classes A, B, C, R and Y, respectively,
multiplied by the average account value over the period, multiplied by
183/366 (to reflect the one-half year period), (51/366 for Class Y.)
9
Pioneer Value Fund
- --------------------------------------------------------------------------------
PORTFOLIO MANAGEMENT DISCUSSION 9/30/04
- --------------------------------------------------------------------------------
The stock market rally that began in 2003 lost momentum early in 2004. Value
stocks, as represented by the Russell 1000 Value Index, outperformed growth
issues, as represented by the Russell 1000 Growth Index, over the last twelve
months, with most of the fiscal period's gains occurring in late 2003. In the
following discussion, portfolio manager Rod Wright reviews the market and the
economy and describes the factors that affected the Fund's performance for its
latest fiscal year.
Q. Please describe the investment background over the last twelve months.
A. In the last quarter of 2003, weaker and more speculative issues led the
stock market higher in what proved to be the final leg of the rally that had
begun in March. Since then, a number of influences have made markets choppy.
With the economy expanding at a vigorous clip in the first quarter, the
Federal Reserve Board raised interest rates, causing a decline in stock
prices. The Fed has now raised rates three times since June. The market
regained some ground in the summer on the strength of positive earnings, but
the uncertainty caused by the ultimate level of interest rates, higher oil
prices, slower than anticipated jobs growth, the war in Iraq, and the
upcoming election have conspired to keep the overall market relatively flat
in 2004.
Q. How did Pioneer Value Fund perform against that background?
A. For the twelve months ended September 30, 2004, Pioneer Value Fund's Class
A, B, C, R and Y shares had total returns at net asset value of 17.04%,
15.95%, 15.66%, 15.64% and 17.10%, respectively. These figures compare to
the 20.42% return of the Russell 1000 Value Index, the Fund's benchmark, for
the same period. During the 12-month period, the average return of the 413
funds in Lipper's large-cap value category was 16.41%.
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.
10
Pioneer Value Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Q. Which of your decisions or strategies had the most impact on performance?
A. In order to focus more closely on our stock picking, we have aligned the
Fund's sector weightings more closely to our benchmark than before. As a
result, most of the impact on performance comes from stock selection rather
than sector bets. We think this strategy plays to our strengths.
Several of our choices in the energy sector scored impressive gains, as oil
prices moved to record levels. Suncor Energy's costly process for extracting
oil from Canadian oil sands grew more profitable as prices rose. Deep water
driller Transocean Offshore and Anadarko, an exploration and development
company, also benefited from rising prices, as did integrated producers
Conoco Phillips and Occidental Petroleum. Performance relative to the
benchmark suffered somewhat from our not holding ExxonMobil, which we had
viewed as overvalued.
Q. What were some other selections that influenced performance favorably?
A. The turnaround continued at Tyco, a conglomerate with worldwide interests,
as a new management team imposed fiscal discipline. Tyco also sold off
unproductive units and strengthened its balance sheet by reducing its debt
burden. AT&T Wireless rose sharply early in the period on news that Cingular
was launching a takeover bid.
In financials, Countrywide Financial, a mortgage lender, saw profits
increase as mortgage rates moderated and homebuilding continued to be
strong. Credit-card issuer Providian rose on the basis of stronger financial
performance and a revised business strategy. But First Data, which processes
credit-card transactions, rose only modestly as earnings growth stalled.
Freddie Mac, the government-chartered company that purchases home mortgages
and bundles them into securities, rose on strong housing activity while
dealing with a series of regulatory challenges. Successful implementation of
its merger with Fleet Bank helped boost shares of Bank of America.
United Technologies also rose as the company benefited from cyclical
upswings in its Pratt and Whitney aerospace and Carrier
11
Pioneer Value Fund
- --------------------------------------------------------------------------------
PORTFOLIO MANAGEMENT DISCUSSION 9/30/04 (continued)
- --------------------------------------------------------------------------------
air conditioning divisions. Waste Management continued to perform well in
the expanding economy.
Q. Which of the Fund's holdings held back results?
A. Unexpected news of safety concerns surrounding Vioxx, Merck's arthritis
treatment, and the drug's withdrawal from the market drove shares of the
pharmaceutical giant sharply lower on the last day of the period. We are
assessing the impact of this news on Merck's prospects and watching
developments closely. We eliminated shares of AT&T following a court ruling
which allowed the regional Bell companies to raise the price AT&T pays for
access to their lines. The higher fees have done damage to AT&T's position
in the highly competitive, price-sensitive long-distance market. HCA, like
other hospital companies, has seen uncollectable accounts expand, as it
treats numbers of uninsured patients and others who cannot pay their bills.
Among media companies, shares of Clear Channel Communications, which
operates over 1,100 radio stations, have slumped for most of this year as ad
revenues failed to expand with the economic recovery. Time Warner continued
to struggle with problems at its AOL division. Wariness that Wal-Mart's
grocery operation would encroach on its market share caused supermarket
chain Kroger to decline, despite good business fundamentals.
Q. What is your outlook for the economy and for value stocks?
A. Cautiously optimistic. We feel that earnings will expand as the economy
continues to move forward. A moderating economic expansion rate, such as we
are experiencing, could take some of the pressure off the Federal Reserve
Board to raise interest rates further. As earnings have grown while stock
prices remained flat, equity valuations are now more in line with earnings
potential than they were at the beginning of 2004; so, the market is more
attractively valued than a year ago, and gradually rising earnings may fuel
a parallel rise in stock prices. Among other variables, a decline in oil
prices would be a major positive, as would the cooling of international hot
spots like Iraq and North Korea.
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.
12
Pioneer Value Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 9/30/04
- --------------------------------------------------------------------------------
Shares Value
COMMON STOCKS - 96.4%
Energy - 12.2%
Integrated Oil & Gas - 6.6%
775,000 BP Amoco Plc (A.D.R.) $ 44,585,750
1,000,000 ConocoPhillips 82,850,000
1,200,000 ChevronTexaco Corp. 64,368,000
1,024,400 Occidental Petroleum Corp. 57,294,692
--------------
$ 249,098,442
--------------
Oil & Gas Drilling - 2.0%
775,000 ENSCO International, Inc. $ 25,319,250
550,000 Nabors Industries, Inc.* 26,042,500
700,000 Transocean Offshore, Inc.* 25,046,000
--------------
$ 76,407,750
--------------
Oil & Gas Exploration & Production - 3.6%
700,000 Anadarko Petroleum Corp. $ 46,452,000
800,000 Devon Energy Corp. 56,808,000
1,098,800 Suncor Energy, Inc. 35,172,588
--------------
$ 138,432,588
--------------
Total Energy $ 463,938,780
--------------
Materials - 4.7%
Commodity Chemicals - 1.1%
1,000,000 Praxair, Inc. $ 42,740,000
--------------
Diversified Chemical - 0.9%
550,000 PPG Industries, Inc. $ 33,704,000
--------------
Diversified Metals & Mining - 0.7%
500,000 Freeport-McMoRan Copper & Gold, Inc. (Class B) $ 20,250,000
65,000 Phelps Dodge Corp. 5,981,950
--------------
$ 26,231,950
--------------
Metal & Glass Containers - 0.7%
700,000 Ball Corp. $ 26,201,000
--------------
Paper Products - 1.3%
750,000 Weyerhaeuser Co. $ 49,860,000
--------------
Total Materials $ 178,736,950
--------------
Capital Goods - 7.3%
Aerospace & Defense - 1.1%
750,000 Northrop Grumman Corp. $ 39,997,500
--------------
The accompanying notes are an integral part of these financial statements. 13
Pioneer Value Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 9/30/04 (continued)
- --------------------------------------------------------------------------------
Shares Value
Electrical Component & Equipment - 1.8%
2,007,900 General Electric Co. $ 67,425,282
--------------
Industrial Conglomerates - 4.4%
375,000 Donaldson Co., Inc. $ 10,646,250
2,400,000 Tyco International, Ltd. 73,584,000
900,000 United Technologies Corp. 84,042,000
--------------
$ 168,272,250
--------------
Total Capital Goods $ 275,695,032
--------------
Commercial Services & Supplies - 1.8%
Environmental Services - 1.8%
2,500,000 Waste Management, Inc. $ 68,350,000
--------------
Total Commercial Services & Supplies $ 68,350,000
--------------
Transportation - 2.2%
Airlines - 1.0%
2,675,000 Southwest Airlines Co. $ 36,433,500
--------------
Railroads - 0.3%
248,100 Canadian National Railway Co. $ 12,032,850
--------------
Trucking - 0.9%
440,000 United Parcel Service $ 33,404,800
--------------
Total Transportation $ 81,871,150
--------------
Hotels, Restaurants & Leisure - 1.2%
Restaurants - 1.2%
1,675,000 McDonald's Corp. $ 46,950,250
--------------
Total Hotels, Restaurants & Leisure $ 46,950,250
--------------
Media - 6.7%
Advertising - 0.2%
110,000 Omnicom Group $ 8,036,600
--------------
Broadcasting & Cable TV - 2.4%
1,250,000 Clear Channel Communications, Inc. $ 38,962,500
1,775,000 Comcast Corp.* 50,126,000
--------------
$ 89,088,500
--------------
Movies & Entertainment - 3.4%
5,100,000 Time Warner, Inc.* $ 82,314,000
1,400,000 Viacom, Inc. (Class B) 46,984,000
--------------
$ 129,298,000
--------------
14 The accompanying notes are an integral part of these financial statements.
Pioneer Value Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Shares Value
Publishing - 0.7%
308,600 Gannett Co. $ 25,848,336
--------------
Total Media $ 252,271,436
--------------
Retailing - 0.6%
Department Stores - 0.6%
500,000 Kohl's Corp.* $ 24,095,000
--------------
Total Retailing $ 24,095,000
--------------
Food & Drug Retailing - 2.1%
Food Retail - 2.1%
2,617,000 Kroger Co.* $ 40,615,840
175,000 Nestle SA (Registered Shares) 40,200,803
--------------
Total Food & Drug Retailing $ 80,816,643
--------------
Food, Beverage & Tobacco - 2.4%
Packaged Foods & Meats - 0.9%
1,500,000 Sara Lee Corp. $ 34,290,000
--------------
Soft Drinks - 1.5%
1,200,000 PepsiCo, Inc. $ 58,380,000
--------------
Total Food, Beverage & Tobacco $ 92,670,000
--------------
Household & Personal Products - 1.0%
Personal Products - 1.0%
600,000 Kimberly-Clark Corp. $ 38,754,000
--------------
Total Household & Personal Products $ 38,754,000
--------------
Health Care Equipment & Services - 3.3%
Health Care Distributors - 0.9%
920,000 Wyeth $ 34,408,000
--------------
Health Care Facilities - 2.4%
2,300,000 HCA, Inc. $ 87,745,000
400,000 Tenet Healthcare Corp.* 4,316,000
--------------
$ 92,061,000
--------------
Total Health Care Equipment & Services $ 126,469,000
--------------
Pharmaceuticals & Biotechnology - 2.8%
Pharmaceuticals - 2.8%
1,350,000 Merck & Co., Inc. $ 44,550,000
2,000,000 Pfizer, Inc. 61,200,000
--------------
Total Pharmaceuticals & Biotechnology $ 105,750,000
--------------
The accompanying notes are an integral part of these financial statements. 15
Pioneer Value Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 9/30/04 (continued)
- --------------------------------------------------------------------------------
Shares Value
Banks - 11.8%
Diversified Banks - 7.7%
4,432,950 Bank of America Corp. $ 192,079,724
1,600,000 U.S. Bancorp 46,240,000
900,000 Wells Fargo & Co. 53,667,000
--------------
$ 291,986,724
--------------
Regional Banks - 0.5%
450,000 North Fork Bancorporation, Inc. (b) $ 20,002,500
--------------
Thrifts & Mortgage Finance - 3.6%
2,050,000 Freddie Mac $ 133,742,000
--------------
Total Banks $ 445,731,224
--------------
Diversified Financials - 12.9%
Asset Management & Custody Banks - 1.5%
2,000,000 The Bank of New York Co., Inc. $ 58,340,000
--------------
Consumer Finance - 1.9%
4,600,000 Providian Financial Corp.* $ 71,484,000
--------------
Investment Banking & Brokerage - 4.6%
525,000 Goldman Sachs Group, Inc. $ 48,951,000
750,000 Lehman Brothers Holdings, Inc. 59,790,000
1,298,400 Merrill Lynch & Co., Inc. 64,556,448
--------------
$ 173,297,448
--------------
Diversified Financial Services - 4.9%
4,172,800 Citigroup, Inc. $ 184,103,936
--------------
Total Diversified Financials $ 487,225,384
--------------
Insurance - 8.1%
Insurance Brokers - 1.1%
950,000 Marsh & McLennan Co., Inc. $ 43,472,000
--------------
Life & Health Insurance - 1.1%
2,727,300 UNUM Corp. $ 42,791,337
--------------
Multi-Line Insurance - 3.0%
500,000 American International Group, Inc. $ 33,995,000
900 Berkshire Hathaway, Inc.* 77,985,000
--------------
$ 111,980,000
--------------
16 The accompanying notes are an integral part of these financial statements.
Pioneer Value Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Shares Value
Property & Casualty Insurance - 2.9%
600,000 Ambac Financial Group, Inc. $ 47,970,000
1,250,000 Allstate Corp. 59,987,500
--------------
$ 107,957,500
--------------
Total Insurance $ 306,200,837
--------------
Software & Services - 3.4%
Application Software - 1.3%
2,667,800 Veritas Software Corp.* $ 47,486,840
--------------
Data Processing & Outsourced Services - 2.1%
1,850,000 First Data Corp. $ 80,475,000
--------------
Total Software & Services $ 127,961,840
--------------
Technology Hardware & Equipment - 4.3%
Communications Equipment - 1.8%
1,450,000 Motorola, Inc. $ 26,158,000
3,185,800 Nokia Corp. (A.D.R.) 43,709,176
--------------
$ 69,867,176
--------------
Computer Hardware - 2.1%
4,200,000 Hewlett-Packard Co. $ 78,750,000
--------------
Electronic Equipment & Instruments - 0.4%
620,400 Koninklijke Philips Electronics $ 14,213,364
--------------
Total Technology Hardware & Equipment $ 162,830,540
--------------
Semiconductors - 0.7%
1,248,200 Intel Corp. $ 25,038,892
--------------
Total Semiconductors $ 25,038,892
--------------
Telecommunication Services - 5.7%
Integrated Telecommunications Services - 2.1%
450,000 Alltel Corp. $ 24,709,500
2,000,000 BellSouth Corp. 54,240,000
--------------
$ 78,949,500
--------------
Wireless Telecommunications Services - 3.6%
3,200,000 AT&T Wireless Services, Inc.* $ 47,296,000
300,000 Nextel Communications, Inc.* 7,152,000
2,400,000 Vodafone Group Plc (A.D.R.) 57,864,000
10,000,000 Vodafone Group Plc 24,007,711
--------------
$ 136,319,711
--------------
Total Telecommunication Services $ 215,269,211
--------------
The accompanying notes are an integral part of these financial statements. 17
Pioneer Value Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 9/30/04 (continued)
- --------------------------------------------------------------------------------
Shares Value
Utilities - 1.2%
Electric Utilities - 1.2%
700,000 Dominion Resources, Inc. $ 45,675,000
--------------
Total Utilities $ 45,675,000
--------------
TOTAL COMMON STOCKS
(Cost $3,073,741,138) $3,652,301,169
--------------
Principal
Amount
TEMPORARY CASH INVESTMENTS - 4.1%
Repurchase Agreement - 3.6%
$137,100,000 Greenwich Capital, Inc., 1.68%, dated
9/30/04, repurchase price of $137,100,000
plus accrued interest on 10/1/04
collateralized by $57,135,000 U.S. Treasury
Bills, 3.5%, 11/15/06, $30,000,000 U.S.
Treasury Bills, 3.375%, 12/15/08 and
$50,000,000 U.S. Treasury Bills, 2.75%,
6/30/06 $ 137,100,000
--------------
Shares
Time Deposits - 0.5%
13,805,232 BNP Paribas $ 13,805,232
4,961,757 Royal Bank of Canada 4,961,757
470,511 Westdeutsche Landesbank Girozentrale 470,511
==============
$ 19,237,500
--------------
TOTAL TEMPORARY CASH INVESTMENTS
(Cost $156,337,500) $ 156,337,500
--------------
TOTAL INVESTMENT IN SECURITIES - 100.5%
Cost ($3,230,078,638) (a) $3,808,638,669
--------------
OTHER ASSETS AND LIABILITIES - (0.5)% $ (19,198,145)
--------------
TOTAL NET ASSETS - 100.0% $3,789,440,524
==============
18 The accompanying notes are an integral part of these financial statements.
Pioneer Value Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
* Non-income producing securities.
A.D.R. American Depositary Receipts
(a) At September 30, 2004, the net unrealized gain on
investments based on cost for federal income tax
purposes of $3,246,120,824 was as follows:
Aggregate gross unrealized gain for all investments in
which there is an excess of value over tax cost $648,860,057
Aggregate gross unrealized loss for all investments in
which there is an excess of tax cost over value (86,342,212)
------------
Net unrealized gain $562,517,845
============
(b) At September 30, 2004, the following securities were out on loan:
Shares Security Market Value
427,500 North Fork Bancorporation, Inc. $19,002,375
-----------
Total $19,002,375
===========
Purchases and sales of securities (excluding temporary cash investments) for the
year ended September 30, 2004 aggregated $1,473,656,478 and $1,785,686,989,
respectively.
The accompanying notes are an integral part of these financial statements. 19
Pioneer Value Fund
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES 9/30/04
- --------------------------------------------------------------------------------
ASSETS:
Investment in securities, at value (including securities
loaned of $19,002,375) (cost $3,230,078,638) $3,808,638,669
Cash 58,530
Receivables -
Fund shares sold 3,057,876
Dividends, interest and foreign taxes withheld 3,553,242
Other 65,894
--------------
Total assets $3,815,374,211
--------------
LIABILITIES:
Payables -
Fund shares repurchased $ 2,659,492
Upon return of securities loaned 19,237,500
Due to affiliates 3,766,440
Accrued expenses 270,255
--------------
Total liabilities $ 25,933,687
--------------
NET ASSETS:
Paid-in capital $2,807,050,960
Undistributed net investment income 13,655,329
Accumulated net realized gain on investments and foreign
currency transactions 390,169,934
Net unrealized gain on investments 578,560,031
Net unrealized gain on assets and liabilities denominated in
foreign currencies 4,270
--------------
Total net assets $3,789,440,524
==============
NET ASSET VALUE PER SHARE:
(No par value, unlimited number of shares authorized)
Class A (based on $3,745,950,373/198,945,805 shares) $ 18.83
==============
Class B (based on $32,440,273/1,814,960 shares) $ 17.87
==============
Class C (based on $9,167,623/513,058 shares) $ 17.87
==============
Class R (based on $10,049/539 shares) $ 18.64
==============
Class Y (based on $1,872,206/99,375 shares) $ 18.84
==============
MAXIMUM OFFERING PRICE:
Class A ($18.83 [divided by] 94.25%) $ 19.98
==============
20 The accompanying notes are an integral part of these financial statements.
Pioneer Value Fund
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
- --------------------------------------------------------------------------------
For the Year Ended 9/30/04
INVESTMENT INCOME:
Dividends (net of foreign taxes withheld of $199,634) $ 65,118,720
Interest 588,247
Income from securities loaned, net 83,810
------------
Total investment income $ 65,790,777
------------
EXPENSES:
Management fees
Basic Fee $ 22,729,835
Performance Adjustment 90,559
Transfer agent fees and expenses
Class A 6,217,166
Class B 77,225
Class C 49,353
Class R 98
Distribution fees
Class A 8,628,313
Class B 283,124
Class C 84,456
Class R 29
Administrative reimbursements 446,808
Custodian fees 179,254
Registration fees 82,035
Professional fees 16,201
Fees and expenses of nonaffiliated trustees 47,035
Miscellaneous 45,517
------------
Total expenses $ 38,977,008
------------
Less fees paid indirectly (40,478)
Net expenses $ 38,936,530
------------
Net investment income $ 26,854,247
------------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS:
Net realized gain (loss) on:
Investments $411,099,019
Other assets and liabilities denominated in
foreign currencies (521,497) $410,577,522
------------ ------------
Change in net unrealized gain on:
Investments $142,288,308
Other assets and liabilities denominated in
foreign currencies 139,429 $142,427,737
------------ ------------
Net gain on investments and foreign currency
transactions $553,005,259
------------
Net increase in net assets resulting from operations $579,859,506
============
The accompanying notes are an integral part of these financial statements. 21
Pioneer Value Fund
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
For the Years Ended 9/30/04 and 9/30/03, respectively
Year Ended Year Ended
9/30/04 9/30/03
FROM OPERATIONS:
Net investment income $ 26,854,247 $ 27,571,486
Net realized gain (loss) on investments and foreign
currency transactions 410,577,522 (6,014,714)
Change in net unrealized gain on investments and
foreign currency transactions 142,427,737 648,601,696
-------------- --------------
Net increase in net assets resulting from operations $ 579,859,506 $ 670,158,468
-------------- --------------
DISTRIBUTIONS TO SHAREOWNERS:
Net investment income:
Class A ($0.14 and $0.24 per share, respectively) $ (28,499,251) $ (51,967,828)
Class B ($0.00 and $0.10 per share, respectively) - (151,062)
Class C ($0.00 and $0.10 per share, respectively) - (42,012)
Class R ($0.09 and $0.06 per share, respectively) (18) (2)
Net realized gain:
Class A ($0.04 and $2.11 per share, respectively) $ (8,442,480) $ (412,167,757)
Class B ($0.04 and $2.11 per share, respectively) (57,538) (3,027,905)
Class C ($0.04 and $2.11 per share, respectively) (17,230) (1,069,111)
Class R ($0.04 and $0.00 per share, respectively) (1) --
-------------- --------------
Total distributions to shareowners $ (37,016,518) $ (468,425,677)
-------------- --------------
FROM FUND SHARE TRANSACTIONS:
Net proceeds from sale of shares $ 154,313,837 $ 168,214,756
Reinvestment of distributions 33,639,128 437,945,687
Cost of shares repurchased (394,332,655) (393,771,669)
-------------- --------------
Net increase (decrease) in net assets resulting
from Fund share transactions $ (206,379,690) $ 212,388,774
--------------- --------------
Net increase in net assets $ 336,463,298 $ 414,121,565
NET ASSETS:
Beginning of year 3,452,977,226 3,038,855,661
-------------- --------------
End of year (including undistributed net investment
income of $13,655,329 and $15,821,848,
respectively) $3,789,440,524 $3,452,977,226
============== ==============
22 The accompanying notes are an integral part of these financial statements.
Pioneer Value Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
For the Years Ended 9/30/04 and 9/30/03, respectively
'04 Shares '04 Amount '03 Shares '03 Amount
CLASS A
Shares sold 7,254,846 $ 132,850,875 9,607,170 $ 146,560,494
Reinvestment of distributions 1,882,875 33,571,800 28,545,217 434,044,832
Less shares repurchased (20,956,950) (383,611,951) (24,720,333) (373,704,092)
----------- ------------- ----------- -------------
Net increase (decrease) (11,819,229) $(217,189,276) 13,432,054 $ 206,901,234
=========== ============= =========== =============
CLASS B
Shares sold 821,981 $ 14,282,504 868,028 $ 12,968,947
Reinvestment of distributions 3,250 52,391 201,911 2,933,220
Less shares repurchased (412,570) (7,199,035) (889,846) (12,610,377)
----------- ------------- ----------- -------------
Net increase 412,661 $ 7,135,860 180,093 $ 3,291,790
=========== ============= =========== =============
CLASS C
Shares sold 304,266 $ 5,316,476 574,508 $ 8,684,815
Reinvestment of distributions 924 14,922 66,620 967,635
Less shares repurchased (202,030) (3,518,368) (520,937) (7,457,200)
----------- ------------- ----------- -------------
Net increase 103,160 $ 1,813,030 120,191 $ 2,195,250
=========== ============= =========== =============
CLASS R (a)
Shares sold 620 $ 11,646 36 $ 500
Reinvestment of distributions 1 15 -- --
Less shares repurchased (118) (2,174) -- --
----------- ------------- ----------- -------------
Net increase 503 $ 9,487 36 $ 500
=========== ============= =========== =============
CLASS Y (b)
Shares sold 99,435 $ 1,852,336
Reinvestment of distributions -- --
Less shares repurchased (60) (1,127)
----------- -------------
Net increase 99,375 $ 1,851,209
=========== =============
(a) Class R shares were first publicly offered on April 1, 2003.
(b) Class Y shares were first publicly offered on August 11, 2004.
The accompanying notes are an integral part of these financial statements. 23
Pioneer Value Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Year Ended Year Ended Year Ended Year Ended Year Ended
CLASS A 9/30/04 9/30/03 9/30/02 9/30/01 9/30/00
Net asset value, beginning of period $ 16.25 $ 15.29 $ 19.12 $ 22.67 $ 20.16
---------- ---------- ---------- ---------- ----------
Increase (decrease) from investment operations:
Net investment income $ 0.14 $ 0.11 $ 0.15 $ 0.17 $ 0.20
Net realized and unrealized gain (loss) on investments
and foreign currency transactions 2.62 3.20 (3.17) (2.05) 3.02
---------- ---------- ---------- ---------- ----------
Net increase (decrease) from investment operations $ 2.76 $ 3.31 $ (3.02) $ (1.88) $ 3.22
Distributions to shareowners:
Net investment income (0.14) (0.24) (0.09) (0.14) (0.20)
Net realized gain (0.04) (2.11) (0.72) (1.53) (0.51)
---------- ---------- ---------- ---------- ----------
Net increase (decrease) in net asset value $ 2.58 $ 0.96 $ (3.83) $ (3.55) $ 2.51
---------- ---------- ---------- ---------- ----------
Net asset value, end of period $ 18.83 $ 16.25 $ 15.29 $ 19.12 $ 22.67
========== ========== ========== ========== ==========
Total return* 17.04% 22.94% (16.78)% (8.88)% 16.29%
Ratio of net expenses to average net assets+ 1.02% 1.19% 1.16% 1.01% 0.96%
Ratio of net investment income to average net assets+ 0.72% 0.85% 0.74% 0.76% 0.81%
Portfolio turnover rate 40% 40% 61% 3% 3%
Net assets, end of period (in thousands) $3,745,950 $3,424,962 $3,016,623 $3,885,560 $4,614,739
Ratios assuming reduction for fees paid indirectly:
Net expenses 1.02% 1.19% 1.16% 0.99% 0.94%
Net investment income 0.72% 0.85% 0.74% 0.78% 0.83%
* 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.
+ Ratios assuming no reduction for fees paid indirectly.
24 The accompanying notes are an integral part of these financial statements.
Pioneer Value Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Year Ended Year Ended Year Ended Year Ended Year Ended
CLASS B 9/30/04 9/30/03 9/30/02 9/30/01 9/30/00
Net asset value, beginning of period $ 15.45 $ 14.71 $ 18.53 $ 22.11 $ 19.74
------- ------- ------- ------- -------
Increase (decrease) from investment operations:
Net investment income (loss) $ (0.04) $ (0.13) $ (0.08) $ 0.01 $ (0.14)
Net realized and unrealized gain (loss) on investments
and foreign currency transactions 2.50 3.08 (3.02) (2.06) 3.02
------- ------- ------- ------- -------
Net increase (decrease) from investment operations $ 2.46 $ 2.95 $ (3.10) $ (2.05) $ 2.88
Distributions to shareowners:
Net investment income -- (0.10) -- -- --
Net realized gain (0.04) (2.11) (0.72) (1.53) (0.51)
------- ------- ------- ------- -------
Net increase (decrease) in net asset value $ 2.42 $ 0.74 $ (3.82) $ (3.58) $ 2.37
------- ------- ------- ------- -------
Net asset value, end of period $ 17.87 $ 15.45 $ 14.71 $ 18.53 $ 22.11
======= ======= ======= ======= =======
Total return* 15.95% 21.11% (17.68)% (9.84)% 14.81%
Ratio of net expenses to average net assets+ 1.89% 2.69% 2.28% 2.07% 2.23%
Ratio of net investment loss to average net assets+ (0.15)% (0.66)% (0.38)% (0.30)% (0.48)%
Portfolio turnover rate 40% 40% 61% 3% 3%
Net assets, end of period (in thousands) $32,440 $21,666 $17,976 $22,372 $20,632
Ratios assuming reduction for fees paid indirectly:
Net expenses 1.89% 2.68% 2.29% 2.05% 2.21%
Net investment loss (0.15)% (0.65)% (0.39)% (0.28)% (0.46)%
* 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.
+ Ratios assuming no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements. 25
Pioneer Value Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Year Ended Year Ended Year Ended Year Ended Year Ended
CLASS C 9/30/04 9/30/03 9/30/02 9/30/01 9/30/00
Net asset value, beginning of period $15.49 $14.69 $ 18.53 $22.16 $19.78
------ ------ ------- ------ ------
Increase (decrease) from investment operations:
Net investment income (loss) $(0.09) $(0.12) $ (0.10) $ 0.04 $(0.15)
Net realized and unrealized gain (loss) on investments
and foreign currency transactions 2.51 3.13 (3.02) (2.12) 3.04
------ ------ ------- ------ ------
Net increase (decrease) from investment operations $ 2.42 $ 3.01 $ (3.12) $(2.08) $ 2.89
Distributions to shareowners:
Net investment income -- (0.10) -- (0.02) --
Net realized gain (0.04) (2.11) (0.72) (1.53) (0.51)
------ ------ ------- ------ ------
Net increase (decrease) in net asset value $ 2.38 $ 0.80 $ (3.84) $(3.63) $ 2.38
------ ------ ------- ------ ------
Net asset value, end of period $17.87 $15.49 $ 14.69 $18.53 $22.16
====== ====== ======= ====== ======
Total return* 15.66% 21.61% (17.79)% (9.98)% 14.83%
Ratio of net expenses to average net assets+ 2.21% 2.48% 2.32% 2.15% 2.19%
Ratio of net investment loss to average net assets+ (0.47)% (0.44)% (0.42)% (0.39)% (0.43)%
Portfolio turnover rate 40% 40% 61% 3% 3%
Net assets, end of period (in thousands) $9,168 $6,349 $ 4,256 $4,431 $3,588
Ratios assuming reduction for fees paid indirectly:
Net expenses 2.20% 2.47% 2.32% 2.11% 2.16%
Net investment loss (0.46)% (0.43)% (0.42)% (0.35)% (0.40)%
* 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.
+ Ratios assuming no reduction for fees paid indirectly.
26 The accompanying notes are an integral part of these financial statements.
Pioneer Value Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
4/1/03(a)
Year Ended to
9/30/04 9/30/03
CLASS R
Net asset value, beginning of period $16.24 $13.91
------ ------
Increase from investment operations:
Net investment income (loss) $(0.12) $ 0.05
Net realized and unrealized gain on investments and
foreign currency transactions 2.65 2.34
------ ------
Net increase from investment operations $ 2.53 $ 2.39
Distributions to shareowners:
Net investment income (0.09) (0.06)
Net realized gain (0.04) -
------ ------
Net increase in net asset value $ 2.40 $ 2.33
------ ------
Net asset value, end of period $18.64 $16.24
====== ======
Total return* 15.64% 17.19%
Ratio of net expenses to average net assets+ 2.79% 1.42%**
Ratio of net investment income (loss) to average
net assets+ (1.02)% 0.71%**
Portfolio turnover rate 40% 40%
Net assets, end of period (in thousands) $ 10 $ 1
Ratios assuming reduction for fees paid indirectly:
Net expenses 2.77% 1.42%**
Net investment income (loss) (1.00)% 0.71%**
(a) Class R shares were first publicly offered on April 1, 2003.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges.
** Annualized.
+ Ratio assuming no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements. 27
Pioneer Value Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
8/11/04(a)
to
9/30/04
CLASS Y
Net asset value, beginning of period $18.16
------
Increase from investment operations:
Net investment income $ 0.02
Net realized and unrealized gain on investments and foreign
currency transactions 0.66
------
Net increase from investment operations $ 0.68
------
Net increase in net asset value $ 0.68
------
Net asset value, end of period $18.84
======
Total return* 3.74%
Ratio of net expenses to average net assets+ 0.61%**
Ratio of net investment income to average net assets+ 1.37%**
Portfolio turnover rate 40%
Net assets, end of period (in thousands) $1,872
Ratios assuming reduction for fees paid indirectly:
Net expenses 0.61%**
Net investment income 1.37%**
(a) Class Y shares were first publicly offered on August 11, 2004. * Assumes
initial investment at net asset value at the beginning of each
period, reinvestment of distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges.
** Annualized.
+ Ratio assuming no reduction for fees paid indirectly.
28 The accompanying notes are an integral part of these financial statements.
Pioneer Value Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 9/30/04
- --------------------------------------------------------------------------------
1. Organization and Significant Accounting Policies
Pioneer Value 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 investment objective of the Fund is reasonable income
and growth of capital.
The Fund offers five classes of shares - Class A, Class B, Class C, Class R and
Class Y shares. Class R shares were first publicly offered on April 1, 2003 and
Class Y shares were first publicly offered August 11, 2004. Each class of shares
represents an interest in the same portfolio of investments of the Fund and has
equal rights to voting, redemptions, dividends and liquidation, except that each
class of shares can bear different transfer agent and distribution fees and have
exclusive voting rights with respect to the distribution plans that have been
adopted by Class A, Class B, Class C, Class R and Class Y shareowners,
respectively.
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 gains 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 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 of the Fund. 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, 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,
29
Pioneer Value Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 9/30/04 (continued)
- --------------------------------------------------------------------------------
or under the direction of, the Board of Trustees. 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 September 30, 2004 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
the exercise of reasonable diligence. Interest income is recorded on the
accrual basis. Dividend and interest income are reported net of
unrecoverable foreign taxes withheld at the applicable country rates.
Gains and losses on sales of investments are calculated on the identified
cost method for both financial reporting and federal income tax purposes.
B. Foreign Currency Translation
The books and records of the Fund are maintained in U.S. dollars. Amounts
denominated in foreign currencies are translated into U.S. dollars using
current exchange rates.
Net realized gains and losses on foreign currency transactions represent,
among other things, the net realized gains and losses on foreign currency
contracts, disposition of foreign currencies and the difference between the
amount of income accrued and the U.S. dollars actually received. Further,
the effects of changes in foreign currency exchange rates on investments are
not segregated in the statement of operations from the effects of changes in
market price of those securities but are included with the net realized and
unrealized gain or loss on investments.
C. 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.
30
Pioneer Value Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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 distributions paid during the years ended September 30,
2004 and 2003 were as follows:
- --------------------------------------------------------------------------------
2004 2003
- --------------------------------------------------------------------------------
Distributions paid from:
Ordinary income $28,499,269 $ 52,160,904
Long-term capital gain 8,517,249 416,264,773
Return of capital -- --
----------- ------------
Total $37,016,518 $468,425,677
=========== ============
- --------------------------------------------------------------------------------
The following shows the components of distributable earnings on a federal
income tax basis at September 30, 2004.
- --------------------------------------------------------------------------------
2004
- --------------------------------------------------------------------------------
Undistributed ordinary income $ 52,551,724
Undistributed long-term gain 367,315,725
Unrealized appreciation 562,522,115
------------
Total $982,389,564
============
- --------------------------------------------------------------------------------
The difference between book-basis and tax-basis unrealized appreciation is
attributable to the tax deferral of losses on wash sales.
At September 30, 2004, the Fund reclassified $521,497 to decrease
undistributed net investment income and $521,497 to increase accumulated net
realized gain on investments and foreign currency transactions to reflect
permanent book/tax differences. This reclassification has no impact on the
net asset value of the Fund and is designed to present the Fund's capital
accounts on a tax basis.
31
Pioneer Value Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 9/30/04 (continued)
- --------------------------------------------------------------------------------
D. 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. As of September 30, 2004,
the Fund had no outstanding settlement or portfolio hedges.
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 indirect subsidiary of UniCredito Italiano S.p.A.
(UniCredito Italiano), earned $219,433 in underwriting commissions on the
sale of Class A shares during the year ended September 30, 2004.
F. Class Allocations
Distribution fees are calculated based on the average daily net asset value
attributable to Class A, Class B, Class C and Class R shares of the Fund,
respectively. Class Y 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.
32
Pioneer Value Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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, Class R and Class Y 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.
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
value of cash collateral at period end is disclosed on the Statements of
Assets and Liabilities. The Fund has the right under the lending agreements
to recover the securities from the borrower on demand. The Fund invests cash
collateral in Time Deposits, which is managed by Brown Brothers Harriman &
Co., the Fund's custodian.
33
Pioneer Value Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 9/30/04 (continued)
- --------------------------------------------------------------------------------
2. Management Agreement
PIM, a wholly owned indirect subsidiary of UniCredito Italiano, manages the
Fund's portfolio. PIM receives a basic fee that is calculated at the annual rate
of 0.60% of the Fund's average daily net assets. The basic fee is subject to a
performance adjustment limited to a maximum of +/-0.10% based on the Fund's
investment performance as compared with the Russell 1000[RegTM] Value Index over
a rolling 36-month period. In addition, the fee is further limited to a maximum
annualized rate adjustment of +/-0.10% (a "ceiling" and a "floor"). Effective
August 1, 2004 PIM commenced a voluntary waiver of the minimum fee provision
(the "floor"), but may reimpose it in the future. Pursuant to a shareowner vote
on April 17, 2003 the benchmark was changed from the Lipper Growth & Income
Funds Index effective May 1, 2003; however, the Lipper Growth & Income Index
will be used for monthly periods prior to May 1, 2003 until it is eventually
phased out. For the year ended September 30, 2004, the aggregate performance
adjustment resulted in an increase to the basic fee of $90,559. For the year
ended September 30, 2004, the net management fee was equivalent to 0.60% of
average daily net assets.
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 September 30, 2004, $1,822,059 was payable to
PIM related to management fees, administration costs and certain other services
and is included in due to affiliates.
3. Transfer Agent
PIMSS, a wholly owned indirect subsidiary of UniCredito Italiano, provides
substantially all transfer agent and shareowner services to the Fund at
negotiated rates. Included in due to affiliates is $1,176,351 in transfer agent
fees payable to PIMSS at September 30, 2004.
4. Distribution and Service Plans
The Fund adopted a Plan of Distribution for each class of shares (Class A Plan,
Class B Plan, Class C Plan and Class R Plan) in accordance with Rule 12b-1 under
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 Fund's 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.
34
Pioneer Value Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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. Pursuant to the
Class R Plan, the Fund pays PFD 0.50% of the average daily net assets
attributable to Class R shares, for distribution services. Included in due to
affiliates is $768,030 in distribution fees payable to PFD at September 30,
2004. The Fund also has adopted a separate service plan for Class R shares
(Service Plan). The Service Plan authorizes the Fund to pay securities dealers,
plan administrators or other service organizations that agree to provide certain
services to retirement plans or plan participants holding shares of the Fund a
service fee of up to 0.25% of the Fund's average daily net assets attributable
to Class R shares held by such plans.
In addition, redemptions of each class of shares may be subject to a contingent
deferred sales charge (CDSC). Effective February 1, 2004, 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 (12 months for shares purchased prior to February
1, 2004). Class B shares that are redeemed within six 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. Redemptions of Class C shares
within one year of purchase are subject to a CDSC of 1.00%. Redemptions of Class
R shares within 18 months of purchase were subject to a CDSC of 1.00%. Effective
July 1, 2004, the CDSC on Class R shares were eliminated. Proceeds from the
CDSCs are paid to PFD. For the year ended September 30, 2004, CDSCs in the
amount of $57,222 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 year ended September 30, 2004, the Fund's expenses
were reduced by $40,478 under such arrangements.
6. Line of Credit
The Fund, along with certain others in the Pioneer Family of Funds
35
Pioneer Value Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 9/30/04 (continued)
- --------------------------------------------------------------------------------
(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
year ended September 30, 2004, the Fund had no borrowings under this agreement.
ADDITIONAL INFORMATION (unaudited)
For the fiscal year ended September 30, 2004, certain dividends paid by the Fund
may be subject to a maximum tax rate of 15%, as provided for by the Jobs and
Growth Tax Relief Reconciliation Act (the Act) of 2003. The Fund intends to
designate up to the maximum amount of such dividends allowable under the Act, as
taxed at a maximum rate of 15%. Complete information will be computed and
reported in conjunction with your 2004 Form 1099-DIV.
The qualifying percentage of the Fund's ordinary income dividends for the
purposes of the corporate dividends received deduction was 100.00%.
36
Pioneer Value Fund
- --------------------------------------------------------------------------------
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
- --------------------------------------------------------------------------------
To the Board of Trustees and Shareowners
of Pioneer Value Fund:
We have audited the statement of assets and liabilities, including the schedule
of investments, of Pioneer Value Fund (the "Fund") as of September 30, 2004, and
the related statement of operations for the year then ended, the statements of
changes in net assets for each of the two years in the period then ended, and
the financial highlights for each of the three years in the period then ended.
These financial statements and financial highlights are the responsibility of
the Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits. The financial
highlights for each of the two years in the period ended September 30, 2001 were
audited by other auditors who have ceased operations and whose report, dated
November 5, 2001, expressed an unqualified opinion on those financial
highlights.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements and financial highlights. Our procedures
included confirmation of securities owned as of September 30, 2004, by
correspondence with the custodian. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Pioneer Value Fund at September 30, 2004, the results of its operations for the
year then ended, the changes in its net assets for each of the two years in the
period then ended, and the financial highlights for each of the three years in
the period then ended, in conformity with U.S. generally accepted accounting
principles.
/s/ Ernst & Young LLP
Boston, Massachusetts
November 10, 2004
37
- --------------------------------------------------------------------------------
THE PIONEER FAMILY OF MUTUAL FUNDS
- --------------------------------------------------------------------------------
Please consider a fund's investment objective, risks, charges and expenses
carefully before investing. The prospectus contains this and other information
about a fund and should be read carefully before you invest or send money. To
obtain a prospectus and for other information on any Pioneer fund, contact your
advisor, call 1-800-225-6292 or visit our web site at www.pioneerfunds.com.
U.S. Equity Asset Allocation
Pioneer Fund Pioneer Ibbotson Moderate
Pioneer Balanced Fund Allocation Fund
Pioneer Equity Income Fund Pioneer Ibbotson Growth
Pioneer Growth Shares Allocation Fund
Pioneer Mid Cap Growth Fund Pioneer Ibbotson Aggressive
Pioneer Mid Cap Value Fund Allocation Fund
Pioneer Oak Ridge Large Cap
Growth Fund International/Global Equity
Pioneer Oak Ridge Small Cap Pioneer Emerging Markets Fund
Growth Fund Pioneer Europe Select Fund
Pioneer Papp America-Pacific Pioneer Europe Fund
Rim Fund Pioneer International Equity Fund
Pioneer Papp Small and Mid Cap Pioneer International Value Fund
Growth Fund
Pioneer Papp Stock Fund Fixed Income
Pioneer Papp Strategic Pioneer America Income Trust
Growth Fund Pioneer Bond Fund
Pioneer Real Estate Shares Pioneer Global High Yield Fund
Pioneer Research Fund* Pioneer High Yield Fund
Pioneer Small Cap Value Fund Pioneer Short Term Income Fund
Pioneer Small Company Fund Pioneer Strategic Income Fund
Pioneer Value Fund Pioneer Tax Free Income Fund
Money Market
Pioneer Cash Reserves Fund**
* Name change effective December 11, 2003. Formerly known as Pioneer Core
Equity Fund.
** An investment in the Fund is not insured or guaranteed by the Federal
Deposit Insurance Corporation or any other government agency. Although the
Fund seeks to preserve the value of your investment at $1.00 per share, it
is possible to lose money by investing in the Fund.
38
Pioneer Value Fund
- --------------------------------------------------------------------------------
TRUSTEES, OFFICERS AND SERVICE PROVIDERS
- --------------------------------------------------------------------------------
Investment Adviser
Pioneer Investment Management, Inc.
Custodian
Brown Brothers Harriman & Co.
Independent Registered Public Accounting Firm
Ernst & Young LLP
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.
Trustees and Officers
The Fund's Board of Trustees provides broad supervision over the Fund's affairs.
The officers of the Fund are responsible for the Fund's operations. The Fund's
Trustees and officers are listed below, together with their principal
occupations during the past five years. Trustees who are interested persons of
the Fund within the meaning of the Investment Company Act of 1940 are referred
to as Interested Trustees. Trustees who are not interested persons of the Fund
are referred to as Independent Trustees. Each of the Trustees serves as a
trustee of each of the 65 U.S. registered investment portfolios for which
Pioneer Investment Management, Inc. ("Pioneer") serves as investment adviser
(the "Pioneer Funds"). The address for all Interested Trustees and all officers
of the Fund is 60 State Street, Boston, Massachusetts 02109.
The Fund's statement of additional information provides more detailed
information regarding the Fund's Trustees and is available upon request, without
charge, by calling 1-800-225-6292.
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 September 30 is publicly available to
shareowners at www.pioneerfunds.com. This information is also available at
pioneerfunds.com and the SEC's website at http://www.sec.gov.
39
Pioneer Value Fund
- --------------------------------------------------------------------------------
INTERESTED TRUSTEES
- --------------------------------------------------------------------------------
Positions Held Term of Office and Other Directorships
Name and Age With the Fund Length of Service Principal Occupation During Past Five Years Held by this Trustee
John F. Cogan, Chairman of the Board, Since 1982. Deputy Chairman and a Director of Director of Harbor
Jr. (78)* Trustee and President Serves until Pioneer Global Asset Management S.p.A. Global Company, Ltd.
retirement or (PGAM); Non-Executive Chairman and a
removal. Director of Pioneer Investment
Management USA Inc. (PIM-USA); Chairman
and a Director of Pioneer; Director of
Pioneer Alternative Investment
Management Limited (Dublin); President
and a Director of Pioneer Alternative
Investment Management (Bermuda) Limited
and affiliated funds; President and
Director of Pioneer Funds Distributor,
Inc. (PFD); President of all of the
Pioneer Funds Counsel (since 2000,
partner prior to 2000), Wilm Pickering
Hale and Dorr LLP (counsel to PIM-USA an
Pioneer Funds)
*Mr. Cogan is an Interested Trustee because he is an officer or director of Pioneer and certain of its affiliates.
====================================================================================================================================
Osbert M. Trustee and Since June, 2003. President and Chief Executive Officer, None
Hood (52)** Executive Vice President Serves until PIM-USA since May, 2003 (Director since
retirement or January, 2001); President and Director
removal. of Pioneer since May, 2003; Chairman and
Director of Pioneer Investment
Management Shareholder Services, Inc.
(PIMSS) since May, 2003; Executive Vice
President of all of the Pioneer Funds
since June, 2003; Executive Vice
President and Chief Operating Officer of
PIM-USA, November 2000 to May 2003;
Executive Vice President, Chief
Financial Officer and Treasurer, John
Hancock Advisers, L.L.C., Boston, MA,
November 1999 to November 2000; Senior
Vice President and Chief Financial
Officer, John Hancock Advisers, L.L.C.,
April 1997 to November 1999
====================================================================================================================================
**Mr. Hood is an Interested Trustee because he is an officer or director of Pioneer and certain of its affiliates.
40
Pioneer Value Fund
- --------------------------------------------------------------------------------
INTERESTED TRUSTEES
- --------------------------------------------------------------------------------
Positions Held Term of Office and Other Directorships
Name and Age With the Fund Length of Service Principal Occupation During Past Five Years Held by this Trustee
Mary K. Bush Trustee Since 1997. President, Bush International Director of Brady
(56) Serves until (international financial advisory firm) Corporation
3509 Woodbine retirement or (industrial
Street, removal. identification and
Chevy Chase, specialty coated
MD 20815 material products
manufacturer),
Millennium
Chemicals, Inc.
(commodity
chemicals), Mortgage
Guaranty Insurance
Corporation, and
R.J. Reynolds
Tobacco Holdings,
Inc. (tobacco)
====================================================================================================================================
Richard H. Trustee Since 1992. Alexander Graham Bell Professor of None
Egdahl, M.D. Serves until Health Care Entrepreneurship, Boston
(77) retirement or University; Professor of Management,
Boston University removal. Boston University School of Management;
Healthcare Professor of Public Health, Boston
Entrepreneurship University School of Public Health;
Program, Professor of Surgery, Boston University
53 Bay State School of Medicine; and University
Road, Professor, Boston University
Boston, MA
02215
====================================================================================================================================
Margaret B.W. Trustee Since 1990. Founding Director, The Winthrop Group, None
Graham (57) Serves until Inc. (consulting firm); Professor of
1001 Sherbrooke retirement or Management, Faculty of Management,
Street West, removal. McGill University
Montreal,
Quebec, Canada
H3A 1G5
====================================================================================================================================
Marguerite A. Trustee Since 1982. President and Chief Executive Officer, Director of New
Piret (56) Serves until Newbury, Piret & Company, Inc. America High Income
One Boston retirement or (investment banking firm) Fund, Inc.
Place, removal. (closed-end
28th Floor, investment company)
Boston, MA
02108
====================================================================================================================================
41
Pioneer Value Fund
- --------------------------------------------------------------------------------
INDEPENDENT TRUSTEES
- --------------------------------------------------------------------------------
Positions Held Term of Office and Other Directorships
Name and Age With the Fund Length of Service Principal Occupation During Past Five Years Held by this Trustee
Stephen K. Trustee Since 1993. Senior Counsel, Sullivan & Cromwell Director, The Swiss
West (76) Serves until (law firm) Helvetia Fund, Inc.
125 Broad retirement or (closed-end
Street, removal. investment company)
New York, NY and AMVESCAP PLC
10004 (investment
managers)
====================================================================================================================================
John Winthrop Trustee Since 1985. President, John Winthrop & Co., Inc. None
(68) Serves until (private investment firm)
One North retirement or
Adgers Wharf, removal.
Charleston, SC
29401
- ------------------------------------------------------------------------------------------------------------------------------------
FUND OFFICERS
- ------------------------------------------------------------------------------------------------------------------------------------
Dorothy E. Secretary Since September, Secretary of PIM-USA; Senior Vice None
Bourassa (56) 2003. Serves at President-Legal of Pioneer; and
the discretion of Secretary/Clerk of most of PIM-USA's
Board. subsidiaries since October 2000;
Secretary of all of the Pioneer Funds
since September 2003 (Assistant
Secretary from November 2000 to
September 2003); and Senior Counsel,
Assistant Vice President and Director of
Compliance of PIM-USA from April 1998
through October 2000
====================================================================================================================================
Christopher J. Assistant Secretary Since September, Assistant Vice President and Senior None
Kelley (39) 2003. Serves at Counsel of Pioneer since July 2002; Vice
the discretion of President and Senior Counsel of BISYS
Board. Fund Services, Inc. (April 2001 to June
2002); Senior Vice President and Deputy
General Counsel of Funds Distributor,
Inc. (July 2000 to April 2001; Vice
President and Associate General Counsel
from July 1996 to July 2000); Assistant
Secretary of all of the Pioneer Funds
since September 2003
====================================================================================================================================
42
Pioneer Value Fund
- --------------------------------------------------------------------------------
FUND OFFICERS (continued)
- --------------------------------------------------------------------------------
Positions Held Term of Office and Other Directorships
Name and Age With the Fund Length of Service Principal Occupation During Past Five Years Held by this Trustee
David C. Phelan Assistant Secretary Since September, Partner, Hale and Dorr LLP; Assistant None
(47) 2003. Serves at Secretary of all of Pioneer Funds since
the discretion of September 2003
Board.
====================================================================================================================================
Vincent Nave Treasurer Since November, Vice President-Fund Accounting, None
(59) 2000. Serves at Administration and Custody Services of
the discretion of Pioneer (Manager from September 1996 to
Board. February 1999); and Treasurer of all of
the Pioneer Funds (Assistant Treasurer
from June 1999 to November 2000)
====================================================================================================================================
Mark E. Bradley Assistant Since November, Deputy Treasurer of Pioneer since 2004; None
(45) Treasurer 2004. Treasurer and Senior Vice President, CDC
Serves at the IXIS Asset Management Services from 2002
discretion of the to 2003; Assistant Treasurer and Vice
Board President, MFS Investment Management
from 1997 to 2002; and Assistant
Treasurer of all of the Pioneer Funds
since November 2004
====================================================================================================================================
Luis I. Presutti Assistant Since November, Assistant Vice President-Fund None
(39) Treasurer 2000. Accounting, Administration and Custody
Serves at the Services of Pioneer (Fund Accounting
discretion of the Manager from 1994 to 1999); and
Board Assistant Treasurer of all of the
Pioneer Funds since November 2000
====================================================================================================================================
Gary Sullivan Assistant Since May, 2002. Fund Accounting Manager-Fund Accounting, None
(46) Treasurer Serves at the Administration and Custody Services of
discretion of the Pioneer; and Assistant Treasurer of all
Board of the Pioneer Funds since May 2002
====================================================================================================================================
43
Pioneer Value Fund
- --------------------------------------------------------------------------------
FUND OFFICERS (continued)
- --------------------------------------------------------------------------------
Positions Held Term of Office and Other Directorships
Name and Age With the Fund Length of Service Principal Occupation During Past Five Years Held by this Trustee
Katherine Kim Assistant Since September, Fund Administration Manager-Fund None
Sullivan (30) Treasurer 2003. Accounting, Administration and Custody
Serves at the Services since June 2003; Assistant Vice
discretion of the PresidentMutual Fund Operations of State
Board Street Corporation from June 2002 to
June 2003 (formerly Deutsche Bank Asset
Management); Pioneer Fund Accounting,
Administration and Custody Services
(Fund Accounting Manager from August
1999 to May 2002, Fund Accounting
Supervisor from 1997 to July 1999);
Assistant Treasurer of all of the
Pioneer Funds since September 2003
====================================================================================================================================
Martin J. Chief Compliance Since October, Chief Compliance Officer of Pioneer None
Wolin (37) Officer 2004. (Director of Compliance and Senior
Serves at the Counsel from November 2000 to September
discretion of the 2004); Vice President and Associate
Board General Counsel of UAM Fund Services,
Inc. (mutual fund administration
company) from February 1998 to November
2000; and Chief Compliance Officer of
all of the Pioneer Funds.
====================================================================================================================================
The outstanding capital stock of PFD, Pioneer and PIMSS is indirectly wholly owned by UniCredito Italiano S.p.A. ("UniCredito
Italiano"), one of the largest banking groups in Italy. Pioneer, the fund's investment adviser, provides investment management and
financial services to mutual funds, institutional and other clients.
====================================================================================================================================
44
- --------------------------------------------------------------------------------
HOW TO CONTACT PIONEER
- --------------------------------------------------------------------------------
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@pioneerinvest.com
(for general questions about Pioneer only)
Visit our web site: www.pioneerfunds.com
Please consider the fund's investment objectives, risks, charges and expenses
carefully before investing. The prospectus contains this and other information
about the fund and should be read carefully before you invest or send money. To
obtain a prospectus and for other information on any Pioneer fund, call
1-800-225-6292 or visit our website www.pioneerfunds.com.
The Trust 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
website at 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.
[LOGO] PIONEER
Investments
Pioneer Investment Management, Inc.
60 State Street
Boston, MA 02109
www.pioneerfunds.com
16411-00-1104
(C)2004 Pioneer Funds Distributor, Inc.
Underwriter of Pioneer mutual funds
Member SIPC
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.
Audit Fees
Fees for audit services provided to the Fund,
including fees associated with the routine and non-
routine filings of its Form N-1A, totaled
approximately $44,800 in 2004 and approximately
$42,150 in 2003.
(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.
Audit-Related and Other Fees
There were no audit-related and other services
provided to the Fund during the fiscal years ended
September 30, 2004 and 2003. Additionally, there
were fees for tax compliance services in 2003 that
totaled approximately $4,100 for the 2002 tax
returns.
(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.
Tax Fees
Fees for tax compliance services, primarily for tax
returns, totaled $6,000 in 2004 and $3,600 in 2003.
(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.
Audit-Related and Other Fees
There were no audit-related and other services
provided to the Fund during the fiscal years ended
September 30, 2004 and 2003.
(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 recognizes 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 recognizes 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.
The Fund's independent auditor, Ernst & Young
LLP ("E&Y"), recently has advised the Securities
and Exchange Commission, the Public Company
Accounting Oversight Board, and the Audit
Committee of the Fund's Board of Trustees that
certain non-audit work performed by E&Y's China
affiliate has raised questions regarding E&Y's
independence with respect to its performance of
audit services for the Fund. In July 2004, E&Y
became aware that member firms in China ("E&Y
China") provided certain tax services to offices of
UniCredito Italiano, S.p.A. ("UCI"), a member of
the Fund's Investment Company Complex. The
services included receipt and disbursement of
monies transferred to E&Y China by UCI in
payment of individual expatriate income taxes due
on returns prepared by E&Y China for certain UCI
employees located in China from October 1998 to
May 2003. E&Y became auditors of the Fund in
May 2002. These expatriate tax services were
discontinued in May 2003. The fees received by
E&Y China for all such services totaled $3,685.
The Fund's Audit Committee and E&Y have
discussed the matter, including the nature of the
services provided, the personnel involved in
providing the services and the fees received by
E&Y for performing the services. The Committee
continues to review the facts and circumstances
surrounding the matter, including the issue of
whether the monies transferred for employees' taxes
were de facto monies due the employees for tax
payments rather than monies belonging to UCI.
E&Y has informed the Audit Committee that based
on its internal reviews and the de minimis nature of
the services provided and fees received, it does not
believe its independence with respect to the Fund
has been impaired.
Aggregate Non-Audit Fees
The aggregate non-audit fees for the Fund and
affiliates, as previously defined, totaled $6,000 in
2004 and $31,000 in 2003. These fees include
services provided prior to May 6, 2003, the effective
date of the pre-approval process.
(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.
Non-Audit Services
Beginning with non-audit service contracts entered
into on or after May 6, 2003, the effective date of the
new SEC pre-approval rules, the Funds audit
committee is required to pre-approve services to
affiliates defined by SEC rules to the extent that the
services are determined to have a direct impact on
the operations or financial reporting of the Fund.
For the years ended September 30, 2004 and 2003,
there were no services provided to an affiliate that
required the Funds audit committee pre-approval.
The Funds audit committee of the Board of Trustees
has considered whether the provision of non-audit
services that were rendered to the Affiliates (as
defined) 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
accountants independence.
ITEMS 5-6. [RESERVED]
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. [RESERVED]
ITEM 9. 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 10. 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 Value Fund
By (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr, President
Date November XX, 2004
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr., President
Date November XX, 2004
By (Signature and Title)* /s/ Vincent Nave
Vincent Nave, Treasurer
Date November XX, 2004
* Print the name and title of each signing officer under his or her signature.