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 No. 811-5039
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Credit Suisse Fixed Income Fund
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(Exact Name of Registrant as Specified in Charter)
466 Lexington Avenue, New York, New York 10017-3140
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(Address of Principal Executive Offices) (Zip Code)
J. Kevin Gao, Esq.
Credit Suisse Fixed Income Fund
466 Lexington Avenue
New York, New York 10017-3140
Registrant's telephone number, including area code: (212) 875-3500
Date of fiscal year end: October 31
Date of reporting period: November 1, 2004 to April 30, 2005
ITEM 1. REPORTS TO STOCKHOLDERS.
logo: CREDIT | ASSET
SUISSE | MANAGEMENT
CREDIT SUISSE FUNDS
Semiannual Report
April 30, 2005
(unaudited)
o CREDIT SUISSE
FIXED INCOME FUND
The Fund's investment objectives, risks, charges and expenses (which should be
considered carefully before investing), and more complete information about the
Fund, are provided in the Prospectus, which should be read carefully before
investing. You may obtain additional copies by calling 800-927-2874 or by
writing to Credit Suisse Funds, P.O. Box 55030, Boston, MA 02205-5030.
Credit Suisse Asset Management Securities, Inc., Distributor, is located at 466
Lexington Ave., New York, NY 10017-3140. Credit Suisse Funds are advised by
Credit Suisse Asset Management, LLC.
Investors in the Credit Suisse Funds should be aware that they may be eligible
to purchase Common Class and/or Advisor Class shares (where offered) directly or
through certain intermediaries. Such shares are not subject to a sales charge
but may be subject to an ongoing service and distribution fee of up to 0.50% of
average daily net assets. Investors in the Credit Suisse Funds should also be
aware that they may be eligible for a reduction or waiver of the sales charge
with respect to Class A, B or C shares. For more information, please review the
relevant prospectuses or consult your financial representative.
The views of the Fund's management are as of the date of the letter and the Fund
holdings described in this document are as of April 30, 2005; these views and
Fund holdings may have changed subsequent to these dates. Nothing in this
document is a recommendation to purchase or sell securities.
Fund shares are not deposits or other obligations of Credit Suisse Asset
Management, LLC ("CSAM") or any affiliate, are not FDIC-insured and are not
guaranteed by CSAM or any affiliate. Fund investments are subject to investment
risks, including loss of your investment.
CREDIT SUISSE FIXED INCOME FUND
SEMIANNUAL INVESTMENT ADVISER'S REPORT
April 30, 2005 (unaudited)
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May 25, 2005
Dear Shareholder:
PERFORMANCE SUMMARY
11/01/04 - 04/30/05
FUND & BENCHMARKS PERFORMANCE
Common1 1.26%
Advisor1 0.99%
Class A1,2 1.12%
Class B1,2 0.78%
Class C1,2 0.78%
Lehman Brothers U.S. Aggregate Bond Index3 0.98%
Performance for the Fund's Class A shares, Class B shares and Class C shares
is without the maximum sales charge of 4.75%, 4.00% and 1.00%, respectively2.
MARKET OVERVIEW: A SHIFT IN THE CYCLE
The major factor driving activity in the period was the Federal Open Market
Committee's graduated approach to monetary tightening, which brought the fed
funds rate up 100 basis points, from 1.75% to 2.75% during the Fund's fiscal
half-year. In support of these measured rate hikes the central bank cited
continued improvement in labor-market conditions and growth in total output,
alongside balanced inflation risks. The upward trend in crude oil prices, which
reached a new high of $58 per barrel in March, contributed merely to a
transitory soft patch in economic growth. While short-term interest rates tended
to follow the Fed higher, rates on the long end strangely declined, due in our
view to strong foreign demand for US assets of longer duration. This resulted in
a significant flattening of the yield curve, as the spread between 2-year and
10-year Treasuries dropped from 150 to 55 basis points.
Fed Chairman Greenspan termed the unusual yield curve phenomenon a conundrum,
but we believe the real mystery was the lack of risk aversion among bond market
participants. The longstanding hunger for yield in bonds remained avid into the
new year, particularly for lower rated investment grade and high yield corporate
credits whose valuations had reached historic highs. A correction finally came
in mid-March in a sell-off triggered by a General Motors ("GM") earnings
warning, as a new risk premium priced into the market. In our view, the GM news
helped to accelerate a long-awaited shift in the credit cycle, as we begin to
witness increasingly shareholder-friendly action among corporations such as
buy-backs and increased dividends.
1
CREDIT SUISSE FIXED INCOME FUND
SEMIANNUAL INVESTMENT ADVISER'S REPORT (CONTINUED)
April 30, 2005 (unaudited)
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STRATEGIC REVIEW: DURATION TRADES AND SECURITY SELECTION
In the portfolio we took advantage of the Fed's measured rate hikes through a
curve flattening trade, underweighting shorter duration securities and
overweighting intermediate duration securities. With regard to the credit
sector, we positioned the Fund defensively well in advance of the GM earnings
warning, reducing our exposure to high yield and to investment grade issuers
within the automotive sector. Our positions in Mortgage-Backed Securities
("MBS") benefited due to low volatility and an emphasis on selected mortgage
pools with lower probability of refinancing. In addition, we maintained exposure
to select emerging market bonds, which added to our performance for the period.
Negative contributions to performance included our underweight allocation to US
Agencies, which strengthened in spite of the continuing turbulence at Fannie
Mae.
MARKET OUTLOOK: FUNDAMENTALLY SOUND
In spite of the difficult environment among spread product in the latter part
of the fiscal half-year, we believe the credit environment remains fundamentally
sound thanks to moderate increases in corporate profitability and the continuing
build-up of cash on corporate balance sheets. Given our positive outlook on
credit fundamentals, we would view any further widening in corporate spreads as
an opportunity to increase our weighting relative to the index.
Credit Suisse Fixed Income Management Team
Kevin D. Barry
Michael Gray
Sheila Huang
Richard Avidon
Philip Wubbena
In addition to historical information, this report contains forward-looking
statements, which may concern, among other things, domestic and foreign market,
industry and economic trends and developments and government regulation and
their potential impact on the Fund's investment portfolio. These statements are
subject to risks and uncertainties and actual trends, developments and
regulations in the future and their impact on the Fund could be materially
different from those projected, anticipated or implied. The Fund has no
obligation to update or revise forward-looking statements.
2
CREDIT SUISSE FIXED INCOME FUND
SEMIANNUAL INVESTMENT ADVISER'S REPORT (CONTINUED)
April 30, 2005 (unaudited)
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AVERAGE ANNUAL RETURNS AS OF MARCH 31, 20051
SINCE INCEPTION
1 YEAR 5 YEARS 10 YEARS INCEPTION DATE
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Common Class 1.90% 5.49% 6.23% 6.81% 8/17/87
Advisor Class 1.37% 5.12% -- 5.34% 7/3/96
Class A Without
Sales Charge 1.73% -- -- 3.30% 7/31/01
Class A With Maximum
Sales Charge (3.07)% -- -- 1.94% 7/31/01
Class B Without CDSC 0.91% -- -- 2.50% 7/31/01
Class B With
Maximum CDSC (3.01)% -- -- 2.26% 7/31/01
Class C Without CDSC 0.81% -- -- 2.45% 7/31/01
Class C With
Maximum CDSC (0.17)% -- -- 2.45% 7/31/01
AVERAGE ANNUAL RETURNS AS OF APRIL 30, 20051
SINCE INCEPTION
1 YEAR 5 YEARS 10 YEARS INCEPTION DATE
- --------------------------------------------------------------------------------
Common Class 5.84% 5.93% 6.19% 6.85% 8/17/87
Advisor Class 5.30% 5.55% -- 5.42% 7/3/96
Class A Without
Sales Charge 5.56% -- -- 3.53% 7/31/01
Class A With Maximum
Sales Charge 0.53% -- -- 2.20% 7/31/01
Class B Without CDSC 4.81% -- -- 2.74% 7/31/01
Class B With
Maximum CDSC 0.81% -- -- 2.50% 7/31/01
Class C Without CDSC 4.71% -- -- 2.69% 7/31/01
Class C With
Maximum CDSC 3.71% -- -- 2.69% 7/31/01
Returns represent past performance and include change in share price and
reinvestment of dividends and capital gains. PAST PERFORMANCE CANNOT GUARANTEE
FUTURE RESULTS. The current performance of the Fund may be lower or higher than
the figures shown. Returns and share price will fluctuate, and redemption value
may be less than original cost. The performance results do not reflect the
deduction of taxes that a shareholder would pay on fund distributions or the
redemption of fund shares. Performance information current to the most recent
month-end is available at www.csam.com/us.
3
CREDIT SUISSE FIXED INCOME FUND
SEMIANNUAL INVESTMENT ADVISER'S REPORT (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
1 Fee waivers and/or expense reimbursements reduced expenses for the Fund,
without which performance would be lower. Waivers and/or reimbursements may
be discontinued at any time.
2 Total return for Class A shares for the reporting period, based on offering
price (with maximum sales charge of 4.75%), was down 3.66%. Total return for
Class B shares for the reporting period, based on redemption value (including
maximum contingent deferred sales charge of 4%), was down 3.18%. Total return
for Class C shares for the reporting period, based on redemption value
(including maximum contingent deferred sales charge of 1%), was down 0.21%.
3 The Lehman Brothers U.S. Aggregate Bond Index is composed of the Lehman
Brothers Government/Corporate Bond Index and the Lehman Brothers
Mortgage-Backed Securities Index. It includes U.S. Treasury and agency
issues, corporate bond issues and mortgage-backed securities rated
investment-grade or higher by Moody's Investors Service; the Standard &
Poor's division of The McGraw-Hill Companies, Inc.; or Fitch IBCA Inc.
Investors cannot invest directly in an index.
4
CREDIT SUISSE FIXED INCOME FUND
SEMIANNUAL INVESTMENT ADVISER'S REPORT (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
INFORMATION ABOUT YOUR FUND'S EXPENSES
As an investor of the Fund, you incur two types of costs: ongoing expenses
and transaction costs. Ongoing expenses include management fees, distribution
and service (12b-1) fees and other Fund expenses. Examples of transaction costs
include sales charges (loads), redemption fees and account maintenance fees,
which are not shown in this section and which would result in higher total
expenses. The following table is intended to help you understand your ongoing
expenses of investing in the Fund and to help you compare these expenses with
the ongoing expenses of investing in other mutual funds. The table is based on
an investment of $1,000 made at the beginning of the six month period ended
April 30, 2005.
The table illustrates your Fund's expenses in two ways:
o ACTUAL FUND RETURN. This helps you estimate the actual dollar amount of
ongoing expenses paid on a $1,000 investment in the Fund using the Fund's
actual return during the period. To estimate the expenses you paid over
the period, simply divide your account value by $1,000 (for example, an
$8,600 account value divided by $1,000 = 8.6), then multiply the result by
the number in the "Expenses Paid per $1,000" line under the share class
you hold.
o HYPOTHETICAL 5% FUND RETURN. This helps you to compare your Fund's ongoing
expenses with those of other mutual funds using the Fund's actual expense
ratio and a hypothetical rate of return of 5% per year before expenses.
Examples using a 5% hypothetical fund return may be found in the
shareholder reports of other mutual funds. The hypothetical account values
and expenses may not be used to estimate the actual ending account balance
or expenses you paid for the period.
Please note that the expenses shown in these tables are meant to highlight
your ongoing expenses only and do not reflect any transaction costs, such as
sales charges (loads) or redemption fees. The "Expenses Paid per $1,000" line of
the tables is useful in comparing ongoing expenses only and will not help you
determine the relative total expenses of owning different funds.
5
CREDIT SUISSE FIXED INCOME FUND
SEMIANNUAL INVESTMENT ADVISER'S REPORT (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
EXPENSES AND VALUE OF A $1,000 INVESTMENT
FOR THE SIX MONTH PERIOD ENDED APRIL 30, 2005
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COMMON ADVISOR
ACTUAL FUND RETURN CLASS CLASS CLASS A CLASS B CLASS C
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Beginning Account
Value 11/01/04 $1,000.00 $1,000.00 $1,000.00 $1,000.00 $1,000.00
Ending Account
Value 04/30/05 $1,012.60 $1,009.90 $1,011.20 $1,007.80 $1,007.80
Expenses Paid per $1,000* $ 3.49 $ 5.98 $ 4.74 $ 8.46 $ 8.46
HYPOTHETICAL 5% FUND RETURN
Beginning Account
Value 11/01/04 $1,000.00 $1,000.00 $1,000.00 $1,000.00 $1,000.00
Ending Account
Value 04/30/05 $1,021.32 $1,018.84 $1,020.08 $1,016.36 $1,016.36
Expenses Paid per $1,000* $ 3.51 $ 6.01 $ 4.76 $ 8.50 $ 8.50
COMMON ADVISOR
CLASS CLASS CLASS A CLASS B CLASS C
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ANNUALIZED EXPENSE RATIOS* 0.70% 1.20% 0.95% 1.70% 1.70%
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* Expenses are equal to the Fund's annualized expense ratio for each share
class, multiplied by the average account value over the period, multiplied by
the number of days in the most recent fiscal half year period, then divided
by 365.
The "Expenses Paid per $1,000" and the "Annualized Expense Ratios" in the
tables are based on actual expenses paid by the Fund during the period, net
of fee waivers and/or expense reimbursements. If those fee waivers and/or
expense reimbursements had not been in effect, the Fund's actual expenses
would have been higher.
For more information, please refer to the Fund's prospectus.
6
CREDIT SUISSE FIXED INCOME FUND
SEMIANNUAL INVESTMENT ADVISER'S REPORT (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
CREDIT QUALITY BREAKDOWN*
RATINGS
S&P
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AAA 64.2%
AA 1.6%
A 10.1%
BBB 11.7%
BB 1.5%
B 0.6%
CCC 0.4%
NR 0.5%
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Subtotal 90.6%
Short-Term
Investments 9.4%
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Total 100.0%
======
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* Expressed as a percentage of total investments (excluding security lending
collateral) and may vary over time.
7
CREDIT SUISSE FIXED INCOME FUND
SCHEDULE OF INVESTMENTS
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
PAR RATINGS+
(000) (S&P/MOODY'S) MATURITY RATE% VALUE
------ ------------- -------- ----- -----
CORPORATE BONDS (23.5%)
AEROSPACE & DEFENSE (0.5%)
$ 760 Goodrich Corp., Notesss. (BBB- , Baa3) 04/15/08 7.500 $ 825,822
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BANKS (1.9%)
635 Bank of America Corp., Global Notes (AA- , Aa2) 10/01/10 4.250 630,144
150 Bank of America Corp., Rule 144A,
Company Guaranteed Notes
(Callable 12/31/06 @ $104.04)++ (A , Aa3) 12/31/26 8.070 164,289
1,000 Fifth Third Bank, Subordinated Notes (A+ , Aa2) 02/01/15 4.750 992,525
500 Key Bank NA, Subordinated Notes (A- , A2) 07/01/14 5.800 531,878
300 National City Bank, Series BKNT, Notes (A+ , Aa3) 08/01/09 4.150 298,280
400 Wells Fargo & Co., Global Subordinated Notes (AA- , Aa1) 02/09/15 4.750 397,443
------------
3,014,559
------------
CHEMICALS (0.2%)
380 Lubrizol Corp., Senior Notes (BB+ , Baa3) 10/01/09 4.625 376,998
------------
COMMERCIAL SERVICES (0.4%)
450 Cendant Corp., Units (BBB , Baa1) 08/17/06 4.890 450,216
270 Erac USA Finance Co., Rule 144A, Notes++ (BBB+ , Baa1) 05/15/06 6.625 275,447
------------
725,663
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DIVERSIFIED FINANCIALS (6.4%)
175 Capital One Financial Corp., Senior Notes (BBB- , Baa3) 05/17/07 4.738 176,743
815 Citigroup, Inc., Global Subordinated Notes (A+ , Aa2) 09/15/14 5.000 821,904
540 Ford Motor Credit Co., Global Notesss. (BB+ , Baa2) 01/25/07 6.500 540,163
250 Ford Motor Credit Co., Global Notes (BB+ , Baa2) 01/15/10 5.700 226,178
225 Ford Motor Credit Co., Global Notesss. (BB+ , Baa2) 10/01/13 7.000 202,804
1,300 General Electric Capital Corp., Global Notes # (AAA , Aaa) 03/04/08 2.980 1,301,275
350 General Electric Capital Corp., Global Notes (AAA , Aaa) 03/04/15 4.875 351,461
1,190 General Electric Capital Corp., Series MTNA,
Global Notes (AAA , Aaa) 06/15/12 6.000 1,281,152
245 General Motors Acceptance Corp., Global Bonds (BB , Baa2) 11/01/31 8.000 206,656
190 General Motors Acceptance Corp., Global Notesss. (BB , Baa2) 12/01/14 6.750 159,435
625 Goldman Sachs Group, Inc., Global Notes (A+ , Aa3) 01/15/15 5.125 625,356
1,625 Household Finance Corp., Global Notes (A , A1) 12/15/08 4.125 1,607,611
225 JPMorgan Chase & Co., Global Notesss. (A+ , Aa3) 03/01/15 4.750 221,600
530 MBNA America Bank, Rule 144A, Subordinated
Notes++ (BBB , Baa2) 03/15/08 6.750 562,392
205 Merey Sweeny L.P., Rule 144A, Senior Notes++ (NR , Baa3) 12/18/19 8.850 241,438
425 Merrill Lynch & Company, Inc., Series MTNC,
Global Notes (A+ , Aa3) 01/15/15 5.000 426,428
625 OMX Timber Finance Investment LLC, Rule 144A,
Company Guaranteed Notes
(Callable 10/31/19 @ $100.00)++# (A+ , Aa3) 01/29/20 5.420 630,197
870 SLM Corp., Series MTNA, Notes (A , A2) 01/15/09 4.000 860,130
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10,442,923
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See Accompanying Notes to Financial Statements.
8
CREDIT SUISSE FIXED INCOME FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
PAR RATINGS+
(000) (S&P/MOODY'S) MATURITY RATE% VALUE
------ ------------- -------- ----- -----
CORPORATE BONDS
ELECTRIC (2.8%)
$ 310 American Electric Power Company, Inc., Series A,
Global Notes (BBB , Baa3) 05/15/06 6.125 $ 316,887
545 Cincinnati Gas & Electric Co., Notes (BBB , Baa1) 09/15/12 5.700 574,123
285 Constellation Energy Group, Inc., Notes (BBB , Baa1) 04/01/07 6.350 295,883
200 Dominion Resources, Inc., Series A, Notes (BBB+ , Baa1) 11/15/06 3.660 198,874
600 FPL Group Capital, Inc., Notes (A- , A2) 02/16/07 4.086 599,309
400 Oklahoma Gas & Electric Co., Bonds
(Callable 08/01/14 @ $103.25) (BBB+ , A2) 08/01/34 6.500 431,731
285 Old Dominion Electric Cooperative, Series A,
Secured Notes (AAA , Aaa) 06/01/11 6.250 311,395
290 Pacific Gas & Electric Co., First Mortgage Notes (BBB , Baa1) 03/01/34 6.050 310,969
365 PacifiCorp, First Mortgage Notes (A- , A3) 11/15/11 6.900 411,273
480 Pinnacle West Capital Corp., Senior Notes
(Callable 05/01/05 @ $100.00) # (BBB- , Baa2) 11/01/05 3.543 480,000
560 TXU Corp., Rule 144A, Notes++ (BBB- , Ba1) 11/15/24 6.500 554,248
------------
4,484,692
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ENTERTAINMENT (0.1%)
160 AMC Entertainment, Inc., Senior Subordinated Notes
(Callable 02/01/06 @ $101.58) (CCC+ , B3) 02/01/11 9.500 159,200
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ENVIRONMENTAL CONTROL (0.5%)
625 Waste Management, Inc., Global Company
Guaranteed Notes (BBB , Baa3) 05/15/32 7.750 782,749
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FOOD (1.1%)
445 ConAgra Foods, Inc., Notes (BBB+ , Baa1) 09/15/11 6.750 495,996
430 ConAgra Foods, Inc., Notesss. (BBB+ , Baa1) 09/15/30 8.250 590,285
745 Kellogg Co., Global Senior Notes (BBB+ , Baa1) 06/01/08 2.875 715,567
------------
1,801,848
------------
GAS (0.4%)
585 Sempra Energy, Notes (BBB+ , Baa1) 12/01/05 6.950 595,312
------------
HOME BUILDERS (0.4%)
365 D.R. Horton, Inc., Senior Notes (BB+ , Ba1) 02/15/15 5.250 342,073
375 Pulte Homes, Inc., Notes (BBB- , Baa3) 02/15/35 6.000 350,630
------------
692,703
------------
INSURANCE (1.8%)
1,265 American International Group, Inc.,
Global Notes #ss. (AA+ , Aaa) 05/15/13 4.250 1,203,120
770 Berkshire Hathaway Finance Corp., Rule 144A,
Senior Notes++ (AAA , Aaa) 01/15/10 4.125 759,703
235 Florida Windstorm Underwriting Association,
Rule 144A, Senior Notes++ (A- , A3) 08/25/07 6.850 247,087
610 Nationwide Mutual Insurance Co., Rule 144A, Bonds
(Callable 04/15/14 @ $100.00)++ (A- , A2) 04/15/34 6.600 627,999
140 Progressive Corp., Senior Notes (A+ , A1) 12/01/32 6.250 156,289
------------
2,994,198
------------
See Accompanying Notes to Financial Statements.
9
CREDIT SUISSE FIXED INCOME FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
PAR RATINGS+
(000) (S&P/MOODY'S) MATURITY RATE% VALUE
------ ------------- -------- ----- -----
CORPORATE BONDS
INVESTMENT COMPANY (0.2%)
$ 300 Frank Russell Co., Rule 144A, Company Guaranteed
Notes++ (AAA , Aa1) 01/15/09 5.625 $ 315,726
------------
LODGING (0.0%)
63 Windsor Woodmont Black Hawk, Series B,
First Mortgage Notes ^0 (NR , NR) 03/15/49 13.000 4,809
------------
MEDIA (1.8%)
330 CCO Holdings LLC, Global Senior Notes
(Callable 11/15/08 @ $104.38)ss. (CCC- , B3) 11/15/13 8.750 319,275
730 Comcast Cable Communications Holdings, Inc.,
Global Company Guaranteed Notes (BBB , Baa2) 03/15/13 8.375 887,553
10 Comcast Cable Communications, Inc., Senior Notes (BBB , Baa2) 01/30/11 6.750 10,989
325 Cox Communications, Inc., Notes (BBB- , Baa3) 06/15/05 6.875 326,080
425 News America Holdings, Inc., Company Guaranteed
Notesss. (BBB- , Baa3) 02/01/13 9.250 537,270
350 News America, Inc., Company Guaranteed Notes (BBB- , Baa3) 11/30/28 7.625 413,830
320 Time Warner, Inc., Global Company
Guaranteed Notes (BBB+ , Baa1) 04/15/31 7.625 391,175
------------
2,886,172
------------
MINING (0.4%)
620 Phelps Dodge Corp., Senior Notes (BBB , Baa2) 03/15/34 6.125 646,679
------------
MISCELLANEOUS MANUFACTURING (0.5%)
810 Textron, Inc., Senior Notes (A- , A3) 08/01/10 4.500 808,190
------------
OIL & GAS (1.3%)
600 Amerada Hess Corp., Notes (BBB- , Ba1) 08/15/31 7.300 687,982
140 Enterprise Products Operating LP, Rule 144A,
Senior Notes++ (BB+ , Baa3) 03/01/35 5.750 130,662
450 Enterprise Products Operating LP, Series B, Global
Senior Notes (BB+ , Baa3) 10/15/34 6.650 473,136
360 Pemex Project Funding Master Trust, Rule 144A,
Company Guaranteed Notes++# (BBB , Baa1) 06/15/10 4.310 371,340
370 XTO Energy, Inc., Notes (BBB- , Baa3) 06/30/15 5.300 374,406
------------
2,037,526
------------
PIPELINES (0.2%)
325 Kinder Morgan Energy Partners LP, Notes (BBB+ , Baa1) 11/15/14 5.125 323,542
------------
REAL ESTATE (0.2%)
400 EOP Operating LP, Notes (BBB+ , Baa2) 10/01/10 4.650 394,478
------------
RETAIL (0.6%)
845 Target Corp., Notes (A+ , A2) 08/15/10 7.500 969,055
------------
See Accompanying Notes to Financial Statements.
10
CREDIT SUISSE FIXED INCOME FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
PAR RATINGS+
(000) (S&P/MOODY'S) MATURITY RATE% VALUE
------ ------------- -------- ----- -----
CORPORATE BONDS
TELECOMMUNICATIONS (1.7%)
$ 165 ALLTEL Corp., Notes (A , A2) 05/17/07 4.656 $ 166,482
260 Anixter International, Inc., Company Guaranteed
Notes (BB+ , Ba1) 03/01/15 5.950 254,255
370 Motorola, Inc., Notes (BBB , Baa3) 11/16/07 4.608 372,826
160 New Cingular Wireless Services, Inc., Global Senior
Notes (A , Baa2) 03/01/31 8.750 218,867
345 SBC Communications, Inc., Global Notes (A , A2) 09/15/14 5.100 345,793
325 Sprint Capital Corp., Global Company Guaranteed
Notes (BBB- , Baa3) 01/30/11 7.625 367,279
305 Sprint Capital Corp., Global Company Guaranteed
Notes (BBB- , Baa3) 03/15/32 8.750 411,390
650 Verizon Wireless Capital LLC, Global Notes (A+ , A3) 12/15/06 5.375 663,365
------------
2,800,257
------------
TRANSPORTATION (0.1%)
175 Horizon Lines LLC, Rule 144A, Notes
(Callable 11/01/08 @ $104.50)++ (CCC+ , B3) 11/01/12 9.000 185,062
------------
TOTAL CORPORATE BONDS (Cost $37,803,880) 38,268,163
------------
ASSET BACKED SECURITIES (6.1%)
496 Ameriquest Mortgage Securities, Inc.,
Series 2003-AR2, Class A4 # (AAA , Aaa) 05/25/33 3.370 496,827
4 Capital Auto Receivables Asset Trust, Series 2002-5,
Class A3B # (AAA , Aaa) 04/17/06 2.300 3,552
74 Chase Funding Mortgage Loan, Series 2002-2,
Class 1A4 (AAA , Aaa) 08/25/28 4.877 74,616
682 Countrywide Home Equity Loan Trust, Series 2002-C,
Class A # (AAA , Aaa) 05/15/28 3.194 683,143
1,290 DaimlerChrysler Auto Trust, Series 2004-B, Class A4 (AAA , Aaa) 10/08/09 3.710 1,278,511
105 DaimlerChrysler Master Owner Trust, Series 2002-A,
Class A # (AAA , Aaa) 05/15/07 3.014 105,063
2,245 Discover Card Master Trust I, Series 2003-4,
Class A1 # (AAA , Aaa) 05/15/11 3.064 2,251,665
780 First Franklin Mortgage Loan Asset-Backed Certificates,
Series 2005-FF5, Class A2B # (AAA , Aaa) 03/25/35 3.290 780,000
92 GE Capital Mortgage Services, Inc., Series 1998-HE1,
Class A7 (AAA , Aaa) 06/25/28 6.465 92,255
376 Greenpoint Home Equity Loan Trust, Series 2003-1,
Class A # (AAA , Aaa) 04/15/29 3.224 377,148
456 Greenpoint Home Equity Loan Trust, Series 2004-3,
Class A # (AAA , Aaa) 03/15/35 3.184 457,838
865 Honda Auto Receivables Owner Trust, Series 2003-1,
Class A4 (AAA , Aaa) 07/18/08 2.480 853,377
545 Ixis Real Estate Capital Trust, Series 2005-HE2,
Class M1 # (AA , Aa1) 09/25/35 3.494 545,000
73 Mortgage Lenders Network Home Equity Loan,
Series 1998-2, Class A1 # (AAA , Aaa) 07/25/29 6.605 73,819
See Accompanying Notes to Financial Statements.
11
CREDIT SUISSE FIXED INCOME FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
PAR RATINGS+
(000) (S&P/MOODY'S) MATURITY RATE% VALUE
------ ------------- -------- ----- -----
ASSET BACKED SECURITIES
$ 1,508 SLM Student Loan Trust, Series 2003-1, Class A2 # (AAA , Aaa) 06/17/13 3.050 $ 1,508,944
375 Vanderbilt Mortgage Finance, Series 1998-C,
Class 1B1 (BBB , Baa1) 02/07/15 6.970 381,209
------------
TOTAL ASSET BACKED SECURITIES (Cost $9,969,237) 9,962,967
------------
MORTGAGE-BACKED SECURITIES (49.4%)
1,505 Bank of America Commercial Mortgage, Inc.,
Series 2005-1, Class A5 (AAA , Aaa) 11/10/42 4.976 1,543,232
118,775 Bank of America Commercial Mortgage, Inc.,
Series 2005-1, Class XW # (AAA , Aaa) 11/10/42 0.106 714,507
39,835 Bear Stearns Commercial Mortgage Securities, Inc.,
Series 2003-PWR2, Class X1 # (AAA , Aaa) 05/11/39 0.116 701,602
1,965 Bear Stearns Commercial Mortgage Securities, Inc.,
Series 2004-PWR6, Class A6 (AAA , Aaa) 11/11/41 4.825 1,960,794
1,190 Bear Stearns Commercial Mortgage Securities, Inc.,
Series 2005-T18, Class A4 (AAA , Aaa) 02/13/42 4.933 1,195,356
1,400 Fannie Mae Global Bonds (AAA , Aaa) 11/15/30 6.625 1,731,901
2,265 Fannie Mae Global Notes (AAA , Aaa) 11/15/10 6.625 2,522,515
13 Fannie Mae Pool #004542 (AAA , Aaa) 12/01/08 12.000 13,855
1,252 Fannie Mae Pool #254372++++++ (AAA , Aaa) 07/01/17 6.000 1,298,089
0 Fannie Mae Pool #524164 (1) (AAA , Aaa) 11/01/29 7.000 44
386 Fannie Mae Pool #638040 (AAA , Aaa) 04/01/32 6.500 402,207
378 Fannie Mae Pool #638112 (AAA , Aaa) 04/01/32 6.500 393,169
255 Fannie Mae Pool #656862 (AAA , Aaa) 04/01/33 6.000 262,068
1,689 Fannie Mae Pool #667742 (AAA , Aaa) 04/01/33 6.000 1,736,094
1,398 Fannie Mae Pool #703337 (AAA , Aaa) 04/01/33 5.500 1,413,734
279 Fannie Mae Pool #703598 (AAA , Aaa) 05/01/18 5.500 286,327
220 Fannie Mae Pool #705651 (AAA , Aaa) 06/01/18 5.500 225,836
866 Fannie Mae Pool #713667 (AAA , Aaa) 07/01/33 5.000 860,554
832 Fannie Mae Pool #721796 (AAA , Aaa) 06/01/18 4.500 825,247
3,196 Fannie Mae Pool #725231 (AAA , Aaa) 02/01/34 5.000 3,172,635
2,043 Fannie Mae Pool #725248 (AAA , Aaa) 03/01/34 5.000 2,029,234
1,567 Fannie Mae Pool #725277 (AAA , Aaa) 03/01/19 4.500 1,553,908
986 Fannie Mae Pool #739753 (AAA , Aaa) 12/01/18 5.000 995,171
818 Fannie Mae Pool #741384 (AAA , Aaa) 09/01/18 4.000 795,372
1,341 Fannie Mae Pool #743364 (AAA , Aaa) 10/01/33 5.500 1,355,864
489 Fannie Mae Pool #757490 (AAA , Aaa) 01/01/34 5.500 494,215
2,393 Fannie Mae Pool #758789 (AAA , Aaa) 12/01/33 5.500 2,419,135
1,855 Fannie Mae Pool #761831 (AAA , Aaa) 08/01/33 5.500 1,876,177
824 Fannie Mae Pool #767184 (AAA , Aaa) 02/01/19 5.500 844,835
1,730 Fannie Mae Pool #770154 (AAA , Aaa) 04/01/34 5.000 1,714,702
1,642 Fannie Mae Pool #772297 (AAA , Aaa) 03/01/34 5.500 1,658,815
1,537 Fannie Mae Pool #775174 (AAA , Aaa) 05/01/19 4.500 1,522,228
1,410 Fannie Mae Pool #776327 (AAA , Aaa) 04/01/34 5.000 1,400,457
2,463 Fannie Mae Pool #790724 (AAA , Aaa) 09/01/34 5.500 2,489,326
1,562 Fannie Mae Pool #794268 (AAA , Aaa) 09/01/34 6.500 1,628,127
1,092 Fannie Mae Pool #794821 (AAA , Aaa) 10/01/34 7.000 1,153,993
1,477 Fannie Mae Pool #796906 (AAA , Aaa) 11/01/34 7.000 1,559,909
672 Fannie Mae Strip, Series 337, Class 2 (AAA , Aaa) 06/01/33 5.000 144,475
788 Fannie Mae Strip, Series 354, Class 2 (AAA , Aaa) 11/01/34 5.500 172,937
See Accompanying Notes to Financial Statements.
12
CREDIT SUISSE FIXED INCOME FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
April 30, 2005 (unaudited)
- ------------------------------------------------------------------------------
PAR RATINGS+
(000) (S&P/MOODY'S) MATURITY RATE% VALUE
------ ------------- -------- ----- -----
MORTGAGE-BACKED SECURITIES
$ 1,620 Federal Home Loan Bank Global Bonds (AAA , Aaa) 06/18/14 5.250 $ 1,705,027
2,225 FNMA TBA (AAA , Aaa) 05/02/35 5.000 2,198,057
3,955 FNMA TBA (AAA , Aaa) 05/02/35 5.500 3,993,314
3,930 FNMA TBA (AAA , Aaa) 05/02/35 6.000 4,033,776
2,320 Freddie Mac Global Notes (AAA , Aaa) 11/15/13 4.875 2,379,603
1,575 Freddie Mac Global Subordinated Notes (AAA , Aaa) 03/21/11 5.875 1,682,284
85 Freddie Mac Pool #1B1994 # (AAA , Aaa) 09/01/34 4.763 85,726
1,465 Freddie Mac Pool #A24892 (AAA , Aaa) 07/01/34 6.000 1,504,687
1,370 Freddie Mac Pool #A26682 (AAA , Aaa) 09/01/34 6.000 1,406,686
734 Freddie Mac Pool #B11354 (AAA , Aaa) 12/01/18 5.000 740,982
1,375 Freddie Mac Pool #B13889 (AAA , Aaa) 04/01/19 4.000 1,335,519
1,790 Freddie Mac Pool #N31151++++ (AAA , Aaa) 10/01/34 5.000 1,791,610
990 Freddie Mac REMIC, Series R001, Class AE (AAA , Aaa) 04/15/15 4.375 987,655
1,582 Ginnie Mae Pool #3666 (AAA , Aaa) 01/20/35 6.000 1,631,265
1,640 GNMA TBA (AAA , Aaa) 05/02/35 5.000 1,636,925
1,715 GS Mortgage Securities Corp. II, Series 2004-GG2,
Class A4 (AAA , Aaa) 08/10/38 4.964 1,743,272
964 JPMorgan Chase Commercial Mortgage Securities
Corp., Series 2004-CB9, Class A1 # (AAA , Aaa) 06/12/41 3.475 946,435
301 LB-UBS Commercial Mortgage Trust, Series 2003-C3,
Class A1 (AAA , Aaa) 05/15/27 2.599 291,692
1,637 LB-UBS Commercial Mortgage Trust, Series 2004-C1,
Class A1 (AAA , Aaa) 01/15/29 2.964 1,585,992
1,575 Merrill Lynch Mortgage Trust, Series 2005-MKB2,
Class A4 (AAA , Aaa) 09/12/42 5.204 1,610,801
------------
TOTAL MORTGAGE-BACKED SECURITIES (Cost $80,178,277) 80,359,954
------------
FOREIGN BONDS (11.7%)
ASSET BACKED SECURITIES (1.0%)
1,700 Pure Mortgages, Series 2004-1A, Class A (Ireland) # (AAA , Aaa) 02/28/34 2.932 1,700,000
------------
BANKS (1.0%)
695 Korea Development Bank, Global Notes (South Korea) (A- , A3) 07/20/09 4.750 699,539
915 Royal Bank of Scotland Group PLC, Series 3, Global
Bonds (Callable 12/31/05 @ $100.00)
(United Kingdom) (A , A1) 11/29/49 7.816 940,777
------------
1,640,316
------------
BEVERAGES (0.8%)
885 Diageo Capital PLC, Global Notes (United Kingdom) (A , A2) 05/03/10 4.375 880,692
420 Diageo Finance BV, Global Company Guaranteed
Notes (Netherlands) (A , A2) 04/01/11 3.875 409,336
------------
1,290,028
------------
CHEMICALS (0.1%)
210 Methanex Corp., Yankee Notes (Canada) (BBB- , Ba1) 08/15/05 7.750 213,150
------------
ELECTRIC (0.2%)
330 Compania Nacional de Transmision Electrica SA,
Global Senior Notes (Chile) (A- , Baa1) 04/15/11 7.875 376,221
------------
See Accompanying Notes to Financial Statements.
13
CREDIT SUISSE FIXED INCOME FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
April 30, 2005 (unaudited)
- ------------------------------------------------------------------------------
PAR RATINGS+
(000) (S&P/MOODY'S) MATURITY RATE% VALUE
------ ------------- -------- ----- -----
FOREIGN BONDS
HOLDING COMPANIES-DIVERSIFIED (0.6%)
$ 890 Pacificorp Australia, Rule 144A, Bonds
(Australia)++ (AAA , Aaa) 01/15/08 6.150 $ 934,103
------------
INSURANCE (0.2%)
250 Everest Reinsurance Holdings, Notes (Bermuda)ss. (A- , A3) 10/15/14 5.400 252,892
------------
MEDIA (0.3%)
425 Thomson Corp., Global Notes (Canada) (A- , A3) 01/05/12 6.200 461,408
------------
MISCELLANEOUS MANUFACTURING (0.2%)
315 Tyco International Group SA, Yankee Company
Guaranteed Notes (Luxembourg) (BBB , Baa3) 10/15/11 6.375 341,809
------------
OIL & GAS (0.7%)
185 Canadian Natural Resources, Ltd., Yankee Notes
(Canada) (BBB+ , Baa1) 07/15/11 6.700 203,550
400 Nexen, Inc., Yankee Notes (Canada) (BBB- , Baa2) 03/10/35 5.875 386,917
430 Petroliam Nasional Berhad, Rule 144A, Bonds
(Malaysia)++ (A- , A2) 08/15/15 7.750 519,361
------------
1,109,828
------------
PIPELINES (0.2%)
240 Trans-Canada Pipelines, Ltd., Yankee Bonds (Canada) (A- , A2) 01/15/15 4.875 240,849
------------
SOVEREIGN (6.1%)
8,230 Government of New Zealand, Bonds (New Zealand) (AAA , Aaa) 04/15/15 6.000 6,103,840
880 Government of Russia, Series V, Debentures (Russia) (BBB- , Ba2) 05/14/08 3.000 818,400
315 Republic of Indonesia, Rule 144A,
Notes (Indonesia)++ (B+ , B2) 04/20/15 7.250 304,763
490 Republic of Panama, Global Notes (Panama)ss. (BB , Ba1) 03/15/15 7.250 510,825
520 Republic of Venezuela, Global Notes (Venezuela) # (B , B2) 04/20/11 4.150 462,257
350 Republic of Venezuela, Global Notes (Venezuela) (B , B2) 10/08/14 8.500 345,625
410 United Mexican States, Global Notes (Mexico) (BBB , Baa1) 12/30/19 8.125 481,135
495 United Mexican States, Series MTN, Global Notes
(Mexico) (BBB , Baa1) 01/16/13 6.375 517,522
320 United Mexican States, Series MTNA, Global Notes
(Mexico) (BBB , Baa1) 04/08/33 7.500 347,200
------------
9,891,567
------------
TELECOMMUNICATIONS (0.3%)
390 Deutsche Telekom International Finance BV, Global
Company Guaranteed Notes (Netherlands) # (A- , Baa1) 06/15/30 8.750 524,168
------------
TOTAL FOREIGN BONDS (Cost $18,440,896) 18,976,339
------------
See Accompanying Notes to Financial Statements.
14
CREDIT SUISSE FIXED INCOME FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
PAR RATINGS+
(000) (S&P/MOODY'S) MATURITY RATE% VALUE
------ ------------- -------- ----- -----
UNITED STATES TREASURY OBLIGATIONS (4.7%)
$ 780 United States Treasury Bonds++++ (AAA , Aaa) 02/15/23 7.125 $ 1,018,571
1,617 United States Treasury Bonds++++ (AAA , Aaa) 01/15/25 2.375 1,766,913
35 United States Treasury Bonds (AAA , Aaa) 02/15/31 5.375 39,542
455 United States Treasury Notes++++ (AAA , Aaa) 09/30/06 2.500 448,691
1,550 United States Treasury Notes++++ (AAA , Aaa) 04/15/10 4.000 1,557,629
1,638 United States Treasury Notes++++ (AAA , Aaa) 07/15/14 2.000 1,699,965
1,190 United States Treasury Notes++++ (AAA , Aaa) 02/15/15 4.000 1,171,081
------------
TOTAL UNITED STATES TREASURY OBLIGATIONS (Cost $7,571,300) 7,702,392
------------
MUNICIPAL BOND (1.3%)
TEXAS (1.3%)
1,985 University of Texas, University Revenue Bonds,
Financing Systems, Series D (Cost $2,043,444) (AAA , Aaa) 08/15/34 5.000 2,072,618
------------
NUMBER OF
SHARES
---------
COMMON STOCK (0.0%)
FOOD (0.0%)
105 Archibald Candy Corp. *^ (Cost $8,925) 0
------------
PREFERRED STOCK (0.3%)
TELECOMMUNICATIONS (0.3%)
400 Centaur Funding Corp., Series B, Rule 144A++
(Cost $405,680) 540,750
------------
WARRANTS (0.0%)
BUILDING MATERIALS (0.0%)
65 Dayton Superior Corp., Rule 144A, strike $0.01,
expires 06/15/09 *++ 1
------------
TELECOMMUNICATIONS (0.0%)
40 GT Group Telecom, Inc., Rule 144A, strike $0.00,
expires 02/01/10 *++^ 0
70 IWO Holdings, Inc., Rule 144A, strike $7.00,
expires 01/15/11 *++^ 0
------------
0
------------
TOTAL WARRANTS (Cost $3,300) 1
------------
CONTRACTS
---------
OPTIONS PURCHASED (0.0%)
CALL OPTIONS (0.0%)
1,770 European Economic Unit, strike $1.286, expires 05/05/05 15,925
------------
See Accompanying Notes to Financial Statements.
15
CREDIT SUISSE FIXED INCOME FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
CONTRACTS VALUE
--------- -----
OPTIONS PURCHASED
PUT OPTIONS (0.0%)
1,770 European Economic Unit, strike $1.286, expires 05/05/05 $ 6,768
------------
TOTAL OPTIONS PURCHASED (Cost $43,365) 22,693
------------
NUMBER OF
SHARES
- ---------
SHORT-TERM INVESTMENTS (12.1%)
3,378,953 State Street Navigator Prime Fundss.ss. 3,378,953
PAR
(000) MATURITY RATE%
-------- -------- -----
$ 5,088 State Street Bank and Trust Co. Euro Time Deposit ^^ 05/02/05 1.850 5,088,000
6,880 Federal Home Loan Bank Discount Notes ^^ 05/18/05 2.818 6,870,871
4,375 United States Treasury Bills ^^ 06/09/05 2.730 4,362,238
------------
TOTAL SHORT-TERM INVESTMENTS (Cost $19,700,062) 19,700,062
------------
TOTAL INVESTMENTS AT VALUE (109.1%) (Cost $176,168,366) 177,605,939
LIABILITIES IN EXCESS OF OTHER ASSETS (-9.1%) (14,741,915)
------------
NET ASSETS (100.0%) $162,864,024
============
OPEN OPTION CONTRACTS WRITTEN
NUMBER OF EXERCISE EXPIRATION
NAME OF ISSUER CONTRACTS PRICE DATE VALUE
- --------------------------------------------------------------------------------
S&P 500 Put Option 90 $3.50 5/21/05 $31,500
INVESTMENT ABBREVIATIONS
BKNT = Bank Notes
MTN = Medium Term Note
MTNA = Medium Term Note, Series A
MTNC = Medium Term Note, Series C
NR=Not Rated
REMIC=Real Estate Mortgage Investment Conduits
TBA = To Be Announced
See Accompanying Notes to Financial Statements.
16
CREDIT SUISSE FIXED INCOME FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
+ Credit ratings given by The Standard & Poor's Division of The
McGraw-Hill Companies, Inc. ("S&P") and Moody's Investors Service, Inc.
("Moody's") are unaudited.
++ Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At April 30,
2005, these securities amounted to a value of $7,364,568 or 4.52% of
net assets.
++++ Collateral segregated for futures contracts.
++++++ A portion of the security is pledged as collateral for Options Written.
* Non-income producing security.
^ Not readily marketable security; security is valued at fair value as
determined in good faith by, or under the direction of, the Board of
Trustees.
^^ Collateral segregated for TBA securities.
# Variable rate obligations - The interest rate shown is the rate as of
April 30, 2005.
ss. Security or portion thereof is out on loan.
ss.ss. Represents security purchased with cash collateral received for
securities on loan.
0 Bond is currently in default.
(1) Par value of security held is less than 1,000.
See Accompanying Notes to Financial Statements.
17
CREDIT SUISSE FIXED INCOME FUND
STATEMENT OF ASSETS AND LIABILITIES
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
ASSETS
Investments at value, including collateral for securities on loan
of $3,378,953 (Cost $176,168,366) (Note 2) $177,605,9391
Cash 185
Receivable for investments sold 9,822,171
Interest receivable 1,293,517
Receivable for fund shares sold 196,041
Unrealized appreciation on forward foreign currency contracts
(Note 2) 49,349
Variation margin receivable (Note 2) 1,071
Prepaid expenses and other assets 46,855
------------
Total Assets 189,015,128
------------
LIABILITIES
Advisory fee payable (Note 3) 27,408
Administrative services fee payable (Note 3) 54,836
Shareholder servicing/Distribution fee payable (Note 3) 45,702
Payable for investments purchased 21,960,481
Payable upon return of securities loaned (Note 2) 3,378,953
Payable for fund shares redeemed 366,667
Unrealized depreciation on forward foreign currency contracts
(Note 2) 129,848
Dividend payable 49,324
Outstanding options written, at value (premiums received $35,729)
(Note 2) 31,500
Trustees' fee payable 4,410
Other accrued expenses payable 101,975
------------
Total Liabilities 26,151,104
------------
NET ASSETS
Capital stock, $0.001 par value (Note 6) 16,335
Paid-in capital (Note 6) 178,604,443
Undistributed net investment income 576
Accumulated net realized loss on investments, futures
contracts, options written, swap contracts and foreign
currency transactions (16,892,747)
Net unrealized appreciation from investments, futures
contracts, options written and foreign currency translations 1,135,417
------------
Net Assets $162,864,024
============
COMMON SHARES
Net assets $107,906,692
Shares outstanding 10,826,060
------------
Net asset value, offering price, and redemption price per share $9.97
=====
ADVISOR SHARES
Net assets $ 15,035,824
Shares outstanding 1,508,169
------------
Net asset value, offering price, and redemption price per share $9.97
=====
See Accompanying Notes to Financial Statements.
18
CREDIT SUISSE FIXED INCOME FUND
STATEMENT OF ASSETS AND LIABILITIES (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
A SHARES
Net assets $ 29,233,560
Shares outstanding 2,929,376
------------
Net asset value and redemption price per share $9.98
======
Maximum offering price per share (net asset value/(1-4.75%)) $10.48
======
B SHARES
Net assets $ 7,574,245
Shares outstanding 759,184
------------
Net asset value and offering price per share $9.98
======
C SHARES
Net assets $ 3,113,703
Shares outstanding 312,276
------------
Net asset value and offering price per share $9.97
======
- --------------------------------------------------------------------------------
1 Including $3,309,747 of securities on loan.
See Accompanying Notes to Financial Statements.
19
CREDIT SUISSE FIXED INCOME FUND
STATEMENT OF OPERATIONS
For the Six Months Ended April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
INVESTMENT INCOME (Note 2)
Interest $ 3,865,177
Dividends 18,160
Securities lending 5,520
-----------
Total investment income 3,888,857
-----------
EXPENSES
Investment advisory fees (Note 3) 410,657
Administrative services fees (Note 3) 150,562
Shareholder servicing/Distribution fees (Note 3)
Advisor Class 40,476
Class A 35,671
Class B 34,726
Class C 15,793
Transfer agent fees (Note 3) 117,484
Registration fees 24,664
Custodian fees 23,330
Printing fees (Note 3) 23,195
Legal fees 19,168
Audit fees 15,491
Trustees' fees 8,260
Insurance expense 2,141
Commitment fees (Note 4) 2,114
Miscellaneous expense 6,069
-----------
Total expenses 929,801
Less: fees waived (Note 3) (228,215)
-----------
Net expenses 701,586
-----------
Net investment income 3,187,271
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENTS, FUTURES CONTRACTS,
OPTIONS WRITTEN, SWAP CONTRACTS AND FOREIGN CURRENCY RELATED ITEMS
Net realized gain from investments 359,644
Net realized gain from futures contracts 565,192
Net realized gain from options written 280,753
Net realized loss from swap contracts (9,628)
Net realized loss on foreign currency transactions (264,364)
Net change in unrealized appreciation (depreciation)
from investments (1,495,112)
Net change in unrealized appreciation (depreciation)
from futures contracts (451,737)
Net change in unrealized appreciation (depreciation)
from options written (23,805)
Net change in unrealized appreciation (depreciation)
from swap contracts (8,631)
Net change in unrealized appreciation (depreciation)
from foreign currency translations (161,277)
-----------
Net realized and unrealized loss from investments,
futures contracts, options written, swap contracts and
foreign currency related items (1,208,965)
-----------
Net increase in net assets resulting from operations $ 1,978,306
===========
See Accompanying Notes to Financial Statements.
20
CREDIT SUISSE FIXED INCOME FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
FOR THE SIX MONTHS
ENDED FOR THE YEAR
APRIL 30, 2005 ENDED
(UNAUDITED) OCTOBER 31, 2004
------------ ----------------
FROM OPERATIONS
Net investment income $ 3,187,271 $ 5,633,654
Net realized gain from investments, futures contracts,
options written, swap contracts and
foreign currency transactions 931,597 5,086,298
Net change in unrealized appreciation (depreciation)
from investments futures contracts, options written,
swap contracts and foreign currency translations (2,140,562) (793,010)
------------ ------------
Net increase in net assets resulting from operations 1,978,306 9,926,942
------------ ------------
FROM DIVIDENDS
Dividends from net investment income
Common Class shares (2,483,662) (4,136,648)
Advisor Class shares (324,310) (555,913)
Class A shares (606,009) (1,022,785)
Class B shares (117,123) (200,843)
Class C shares (53,109) (83,348)
------------ ------------
Net decrease in net assets resulting from dividends (3,584,213) (5,999,537)
------------ ------------
FROM CAPITAL SHARE TRANSACTIONS (Note 6)
Proceeds from sale of shares 12,705,662 24,916,360
Reinvestment of dividends 3,255,362 5,428,088
Net asset value of shares redeemed (23,033,077) (56,794,831)
------------ ------------
Net decrease in net assets from capital
share transactions (7,072,053) (26,450,383)
------------ ------------
Net decrease in net assets (8,677,960) (22,522,978)
NET ASSETS
Beginning of period 171,541,984 194,064,962
------------ ------------
End of period $162,864,024 $171,541,984
------------ ------------
Undistributed net investment income $ 576 $ 397,518
============ ============
See Accompanying Notes to Financial Statements.
21
CREDIT SUISSE FIXED INCOME FUND
FINANCIAL HIGHLIGHTS
(For a Common Class Share of the Fund Outstanding Throughout Each Period)
- --------------------------------------------------------------------------------
FOR THE SIX MONTHS
ENDED FOR THE YEAR ENDED OCTOBER 31,
APRIL 30, 2005 -----------------------------------------------------------
(UNAUDITED) 2004 2003 20021 2001 2000
----------- -------- -------- -------- -------- --------
PER SHARE DATA
Net asset value, beginning of period $ 10.07 $ 9.84 $ 9.42 $ 10.33 $ 9.78 $ 9.89
-------- -------- -------- -------- -------- --------
INVESTMENT OPERATIONS
Net investment income 0.202 0.322 0.372 0.50 0.64 0.64
Net gain (loss) on investments, futures contracts,
options written, swap contracts and foreign
currency related items
(both realized and unrealized) (0.07) 0.25 0.49 (0.91) 0.55 (0.11)
-------- -------- -------- -------- -------- --------
Total from investment operations 0.13 0.57 0.86 (0.41) 1.19 0.53
-------- -------- -------- -------- -------- --------
LESS DIVIDENDS
Dividends from net investment income (0.23) (0.34) (0.44) (0.50) (0.64) (0.64)
-------- -------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 9.97 $ 10.07 $ 9.84 $ 9.42 $ 10.33 $ 9.78
======== ======== ======== ======== ======== ========
Total return3 1.26% 5.95% 9.19% (4.07)% 12.52% 5.59%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s omitted) $107,907 $113,947 $129,743 $194,688 $334,647 $302,188
Ratio of expenses to average net assets 0.70%4 0.70% 0.70% 0.70% 0.72% 0.77%
Ratio of net investment income
to average net assets 4.05%4 3.27% 3.82% 4.90% 6.32% 6.53%
Decrease reflected in above operating expense
ratios due to waivers 0.28%4 0.29% 0.28% 0.22% 0.13% 0.02%
Portfolio turnover rate 169% 385% 434% 385% 383% 247%
- --------------------------------------------------------------------------------
1 As required, effective November 1, 2001, the Fund adopted the provisions of
AICPA Audit and Accounting Guide for Investment Companies and began including
paydown gains and losses in interest income. The effect of this change is
less than $0.01 per share for the year ended October 31, 2002 on net
investment income, net realized and unrealized gains and losses and the ratio
of net investment income to average net assets. Per share ratios and
supplemental data for prior periods have not been restated to reflect this
change.
2 Per share information is calculated using the average shares outstanding
method.
3 Total returns are historical and assume changes in share price and
reinvestment of all dividends and distributions. Had certain expenses not
been reduced during the years shown, total returns would have been lower.
Total returns for periods less than one year are not annualized.
4 Annualized.
See Accompanying Notes to Financial Statements.
22
CREDIT SUISSE FIXED INCOME FUND
FINANCIAL HIGHLIGHTS
(For an Advisor Class Share of the Fund Outstanding Throughout Each Period)
- --------------------------------------------------------------------------------
FOR THE SIX MONTHS
ENDED FOR THE YEAR ENDED OCTOBER 31,
APRIL 30, 2005 -----------------------------------------------------------
(UNAUDITED) 2004 2003 20021 2001 2000
----------- -------- -------- -------- -------- --------
PER SHARE DATA
Net asset value, beginning of period $ 10.07 $ 9.84 $ 9.42 $ 10.33 $ 9.78 $ 9.89
-------- -------- -------- -------- -------- --------
INVESTMENT OPERATIONS
Net investment income 0.182 0.282 0.332 0.47 0.62 0.62
Net gain (loss) on investments, futures contracts,
options written, swap contracts and foreign
currency related items
(both realized and unrealized) (0.08) 0.24 0.49 (0.91) 0.55 (0.11)
-------- -------- -------- -------- -------- --------
Total from investment operations 0.10 0.52 0.82 (0.44) 1.17 0.51
-------- -------- -------- -------- -------- --------
LESS DIVIDENDS
Dividends from net investment income (0.20) (0.29) (0.40) (0.47) (0.62) (0.62)
-------- -------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 9.97 $ 10.07 $ 9.84 $ 9.42 $ 10.33 $ 9.78
======== ======== ======== ======== ======== ========
Total return3 0.99% 5.42% 8.77% (4.31)% 12.24% 5.33%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s omitted) $ 15,036 $ 16,912 $ 19,990 $ 25,650 $ 42,633 $ 6,804
Ratio of expenses to average net assets 1.20%4 1.20% 1.09% 0.95% 0.96% 1.02%
Ratio of net investment income
to average net assets 3.55%4 2.78% 3.42% 4.65% 5.86% 6.31%
Decrease reflected in above operating expense
ratios due to waivers 0.28%4 0.29% 0.28% 0.22% 0.17% 0.02%
Portfolio turnover rate 169% 385% 434% 385% 383% 247%
- --------------------------------------------------------------------------------
1 As required, effective November 1, 2001, the Fund adopted the provisions of
AICPA Audit and Accounting Guide for Investment Companies and began including
paydown gains and losses in interest income. The effect of this change is
less than $0.01 per share for the year ended October 31, 2002 on net
investment income, net realized and unrealized gains and losses and the ratio
of net investment income to average net assets. Per share ratios and
supplemental data for prior periods have not been restated to reflect this
change.
2 Per share information is calculated using the average shares outstanding
method.
3 Total returns are historical and assume changes in share price and
reinvestment of all dividends and distributions. Had certain expenses not
been reduced during the years shown, total returns would have been lower.
Total returns for periods less than one year are not annualized.
4 Annualized.
See Accompanying Notes to Financial Statements.
23
CREDIT SUISSE FIXED INCOME FUND
FINANCIAL HIGHLIGHTS
(For a Class A Share of the Fund Outstanding Throughout Each Period)
- --------------------------------------------------------------------------------
FOR THE SIX MONTHS
ENDED FOR THE YEAR ENDED OCTOBER 31,
APRIL 30, 2005 ------------------------------------------------
(UNAUDITED) 2004 2003 20021 20012
----------- -------- -------- -------- --------
PER SHARE DATA
Net asset value, beginning of period $ 10.08 $ 9.85 $ 9.42 $ 10.33 $ 10.26
-------- -------- -------- -------- --------
INVESTMENT OPERATIONS
Net investment income 0.193 0.303 0.183 0.48 0.15
Net gain (loss) on investments,
futures contracts, options written,
swap contracts and foreign currency
related items (both realized and unrealized) (0.08) 0.25 0.66 (0.91) 0.07
-------- -------- -------- -------- --------
Total from investment operations 0.11 0.55 0.84 (0.43) 0.22
-------- -------- -------- -------- --------
LESS DIVIDENDS
Dividends from net investment income (0.21) (0.32) (0.41) (0.48) (0.15)
-------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 9.98 $ 10.08 $ 9.85 $ 9.42 $ 10.33
======== ======== ======== ======== ========
Total return4 1.12% 5.68% 9.03% (4.27)% 2.13%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s omitted) $ 29,234 $ 30,050 $ 33,556 $ 3,829 $ 406
Ratio of expenses to average net assets 0.95%5 0.95% 0.95% 0.95% 0.95%5
Ratio of net investment income
to average net assets 3.80%5 3.03% 1.83% 4.54% 5.66%5
Decrease reflected in above operating expense
ratios due to waivers 0.28%5 0.29% 0.28% 0.25% 0.31%5
Portfolio turnover rate 169% 385% 434% 385% 383%
- --------------------------------------------------------------------------------
1 As required, effective November 1, 2001, the Fund adopted the provisions of
AICPA Audit and Accounting Guide for Investment Companies and began including
paydown gains and losses in interest income. The effect of this change is
less than $0.01 per share for the year ended October 31, 2002 on net
investment income, net realized and unrealized gains and losses and the ratio
of net investment income to average net assets. Per share ratios and
supplemental data for prior periods have not been restated to reflect this
change.
2 For the period July 31, 2001 (inception date) through October 31, 2001.
3 Per share information is calculated using the average shares outstanding
method.
4 Total returns are historical and assume changes in share price and
reinvestment of all dividends and distributions and no sales charge. Had
certain expenses not been reduced during the periods shown, total returns
would have been lower. Total returns for periods less than one year are not
annualized.
5 Annualized.
See Accompanying Notes to Financial Statements.
24
CREDIT SUISSE FIXED INCOME FUND
FINANCIAL HIGHLIGHTS
(For a Class B Share of the Fund Outstanding Throughout Each Period)
- --------------------------------------------------------------------------------
FOR THE SIX MONTHS
ENDED FOR THE YEAR ENDED OCTOBER 31,
APRIL 30, 2005 ------------------------------------------------
(UNAUDITED) 2004 2003 20021 20012
----------- -------- -------- -------- --------
PER SHARE DATA
Net asset value, beginning of period $ 10.07 $ 9.84 $ 9.42 $ 10.33 $ 10.26
-------- -------- -------- -------- --------
INVESTMENT OPERATIONS
Net investment Income 0.153 0.233 0.263 0.40 0.13
Net gain (loss) on investments,
futures contracts, options written,
swap contracts and foreign currency
related items (both realized and unrealized) (0.07) 0.25 0.50 (0.91) 0.07
-------- -------- -------- -------- --------
Total from investment operations 0.08 0.48 0.76 (0.51) 0.20
-------- -------- -------- -------- --------
LESS DIVIDENDS
Dividends from net investment income (0.17) (0.25) (0.34) (0.40) (0.13)
-------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 9.98 $ 10.07 $ 9.84 $ 9.42 $ 10.33
======== ======== ======== ======== ========
Total return4 0.78% 4.90% 8.11% (5.02)% 1.96%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s omitted) $ 7,574 $ 7,385 $ 8,395 $ 5,149 $ 1,044
Ratio of expenses to average net assets 1.70%5 1.70% 1.70% 1.70% 1.70%5
Ratio of net investment income
to average net assets 3.05%5 2.28% 2.65% 3.76% 4.87%5
Decrease reflected in above operating expense
ratios due to waivers 0.28%5 0.29% 0.28% 0.24% 0.32%5
Portfolio turnover rate 169% 385% 434% 385% 383%
- --------------------------------------------------------------------------------
1 As required, effective November 1, 2001, the Fund adopted the provisions of
AICPA Audit and Accounting Guide for Investment Companies and began including
paydown gains and losses in interest income. The effect of this change is
less than $0.01 per share for the year ended October 31, 2002 on net
investment income, net realized and unrealized gains and losses and the ratio
of net investment income to average net assets. Per share ratios and
supplemental data for prior periods have not been restated to reflect this
change.
2 For the period July 31, 2001 (inception date) through October 31, 2001.
3 Per share information is calculated using the average shares outstanding
method.
4 Total returns are historical and assume changes in share price, reinvestment
of all dividends and distributions and no sales charge. Had certain expenses
not been reduced during the periods shown, total returns would have been
lower. Total returns for periods less than one year are not annualized.
5 Annualized.
See Accompanying Notes to Financial Statements.
25
CREDIT SUISSE FIXED INCOME FUND
FINANCIAL HIGHLIGHTS
(For a Class C Share of the Fund Outstanding Throughout Each Period)
- --------------------------------------------------------------------------------
FOR THE SIX MONTHS
ENDED FOR THE YEAR ENDED OCTOBER 31,
APRIL 30, 2005 ------------------------------------------------
(UNAUDITED) 2004 2003 20021 20012
----------- -------- -------- -------- --------
PER SHARE DATA
Net asset value, beginning of period $ 10.06 $ 9.84 $ 9.42 $ 10.33 $ 10.26
-------- -------- -------- -------- --------
INVESTMENT OPERATIONS
Net investment income 0.153 0.223 0.243 0.40 0.12
Net gain (loss) on investments,
futures contracts, options written,
swap contracts and foreign currency
related items (both realized and unrealized) (0.07) 0.25 0.52 (0.91) 0.07
-------- -------- -------- -------- --------
Total from investment operations 0.08 0.47 0.76 (0.51) 0.19
-------- -------- -------- -------- --------
LESS DIVIDENDS
Dividends from net investment income (0.17) (0.25) (0.34) (0.40) (0.12)
-------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 9.97 $ 10.06 $ 9.84 $ 9.42 $ 10.33
======== ======== ======== ======== ========
Total return4 0.78% 4.79% 8.11% (5.03)% 1.89%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s omitted) $ 3,114 $ 3,247 $ 2,381 $ 1,033 $ 296
Ratio of expenses to average net assets 1.70%5 1.70% 1.70% 1.70% 1.70%5
Ratio of net investment income
to average net assets 3.05%5 2.25% 2.45% 3.81% 4.82%5
Decrease reflected in above operating expense
ratios due to waivers 0.28%5 0.29% 0.28% 0.23% 0.33%5
Portfolio turnover rate 169% 385% 434% 385% 383%
- --------------------------------------------------------------------------------
1 As required, effective November 1, 2001, the Fund adopted the provisions of
AICPA Audit and Accounting Guide for Investment Companies and began including
paydown gains and losses in interest income. The effect of this change is
less than $0.01 per share for the year ended October 31, 2002 on net
investment income, net realized and unrealized gains and losses and the ratio
of net investment income to average net assets. Per share ratios and
supplemental data for prior periods have not been restated to reflect this
change.
2 For the period July 31, 2001 (inception date) through October 31, 2001.
3 Per share information is calculated using the average shares outstanding
method.
4 Total returns are historical and assume changes in share price, reinvestment
of all dividends and distributions and no sales charge. Had certain expenses
not been reduced during the periods shown, total returns would have been
lower. Total returns for periods less than one year are not annualized.
5 Annualized.
See Accompanying Notes to Financial Statements.
26
CREDIT SUISSE FIXED INCOME FUND
NOTES TO FINANCIAL STATEMENTS
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
NOTE 1. ORGANIZATION
Credit Suisse Fixed Income Fund (the "Fund") is registered under the
Investment Company Act of 1940, as amended (the "1940 Act"), as a diversified
open-end management investment company that seeks to generate high current
income consistent with reasonable risk and, secondarily, capital appreciation.
The Fund was organized under the laws of the Commonwealth of Massachusetts as a
business trust on January 20, 1987.
The Fund is authorized to offer five classes of shares: Common Class shares,
Advisor Class shares, Class A shares, Class B shares, and Class C shares. Each
class of shares represents an equal pro rata interest in the Fund, except that
each bears different expenses which reflect the differences in the range of
services provided to them. The Fund's Common Class shares are closed to new
investors, other than (1) investors in employee retirement, stock, bonus,
pension or profit-sharing plans, (2) investment advisory clients of Credit
Suisse Asset Management, LLC ("CSAM"), (3) certain registered investment
advisers ("RIAs"), (4) certain broker-dealers and RIAs with clients
participating in comprehensive fee programs and (5) employees of CSAM or its
affiliates and current and former Directors or Trustees of funds advised by CSAM
or its affiliates. Any Common Class shareholder as of the close of business on
December 12, 2001 can continue to buy Common Class shares of the Fund and open
new accounts under the same Social Security number. Class A shares are sold
subject to a front-end sales charge of up to 4.75%. Class B shares are sold
subject to a contingent deferred sales charges which declines from 4.00% to zero
depending on the period of time the shares are held. Class C shares are sold
subject to a contingent deferred sales charge of 1.00% if redeemed within the
first year of purchase.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
A) SECURITY VALUATION -- The net asset value of the Fund is determined daily
as of the close of regular trading on the New York Stock Exchange, Inc. (the
"Exchange") on each day the Exchange is open for business. Debt securities with
a remaining maturity greater than 60 days are valued in accordance with the
price supplied by a pricing service, which may use a matrix, formula or other
objective method that takes into consideration market indices, yield curves and
other specific adjustments. Debt obligations that will mature in 60 days or less
are valued on the basis of amortized cost, which approximates market value,
unless it is determined that using this method would not represent fair value.
The Fund's equity investments are valued at market value, which is generally
27
CREDIT SUISSE FIXED INCOME FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
determined using the closing price on the exchange or market on which the
security is primarily traded at the time of valuation (the "Valuation Time"). If
no sales are reported, equity investments are generally valued at the most
recent bid quotation as of the Valuation Time or at the lowest asked quotation
in the case of a short sale of securities. Securities and other assets for which
market quotations are not readily available, or whose values have been
materially affected by events occurring before the Fund's Valuation Time but
after the close of the securities' primary markets, are valued at fair value as
determined in good faith by, or under the direction of, the Board of Trustees
under procedures established by the Board of Trustees. The Fund may utilize a
service provided by an independent third party which has been approved by the
Board of Trustees to fair value certain securities.
B) FOREIGN CURRENCY TRANSACTIONS -- The books and records of the Fund are
maintained in U.S. dollars. Transactions denominated in foreign currencies are
recorded at the current prevailing exchange rates. All assets and liabilities
denominated in foreign currencies are translated into U.S. dollar amounts at the
current exchange rate at the end of the period. Translation gains or losses
resulting from changes in the exchange rate during the reporting period and
realized gains and losses on the settlement of foreign currency transactions are
reported in the results of operations for the current period. The Fund does not
isolate that portion of realized gains and losses on investments in equity
securities which is due to changes in the foreign exchange rate from that which
is due to changes in market prices of equity securities. The Fund isolates that
portion of realized gains and losses on investments in debt securities which is
due to changes in the foreign exchange rate from that which is due to changes in
market prices of debt securities.
C) SECURITY TRANSACTIONS AND INVESTMENT INCOME -- Security transactions are
accounted for on a trade date basis. Interest income is recorded on the accrual
basis. The Fund amortizes premium and accretes discount using the effective
interest method. Dividends are recorded on the ex-dividend date. Certain
expenses are class- specific expenses and vary by class. Income, expenses
(excluding class-specific expenses) and realized/unrealized gains/ losses are
allocated proportionately to each class of shares based upon the relative net
asset value of the outstanding shares of that class. The cost of investments
sold is determined by use of the specific identification method for both
financial reporting and income tax purposes.
28
CREDIT SUISSE FIXED INCOME FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
D) DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS -- Dividends from net
investment income are declared daily and paid monthly. Distributions of net
realized capital gains, if any, are declared and paid at least annually.
However, to the extent that a net realized capital gain can be reduced by a
capital loss carry forward, such gain will not be distributed. Income and
capital gain distributions are determined in accordance with federal income tax
regulations, which may differ from accounting principles generally accepted in
the United States of America ("GAAP").
E) FEDERAL INCOME TAXES -- No provision is made for federal taxes as it is
the Fund's intention to continue to qualify for and elect the tax treatment
applicable to regulated investment companies under the Internal Revenue Code of
1986, as amended, and to make the requisite distributions to its shareholders,
which will be sufficient to relieve it from federal income and excise taxes.
F) USE OF ESTIMATES -- The preparation of financial statements in conformity
with GAAP requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from these estimates.
G) SHORT-TERM INVESTMENTS -- The Fund, together with other funds/portfolios
advised by Credit Suisse Asset Management, LLC ("CSAM"), an indirect,
wholly-owned subsidiary of Credit Suisse Group, pools available cash into either
a short-term variable rate time deposit issued by State Street Bank and Trust
Company ("SSB"), the Fund's custodian, or a money market fund advised by CSAM.
The short-term time deposit issued by SSB is a variable rate account classified
as a short-term investment.
H) FORWARD FOREIGN CURRENCY CONTRACTS -- The Fund may enter into forward
foreign currency contracts for the purchase or sale of a specific foreign
currency at a fixed price on a future date. Risks may arise upon entering into
these contracts from the potential inability of counterparties to meet the terms
of their contracts and from unanticipated movements in the value of a foreign
currency. The Fund will enter into forward foreign currency contracts primarily
for hedging purposes. Forward foreign currency contracts are adjusted by the
daily exchange rate of the underlying currency and any
29
CREDIT SUISSE FIXED INCOME FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
gains or losses are recorded for financial statement purposes as unrealized
until the contract settlement date or an offsetting position is entered into. At
April 30, 2005, the Fund had the following open forward foreign currency
contracts:
FOREIGN CURRENCY
FORWARD FOREIGN EXPIRATION TO BE CONTRACT CONTRACT UNREALIZED
CURRENCY CONTRACT DATE PURCHASED/(SOLD) AMOUNT VALUE GAIN (LOSS)
---------------------------------------------------------------------------------------------------------------------------
Australian Dollar 7/13/05 A$ 2,020,000 $ 1,557,420 $ 1,569,220 $ 11,800
British Pound 7/13/05 (pound) (406,000) (764,498) (772,777) (8,279)
European Economic Unit 7/13/05 (euro) 2,300,000 2,990,000 2,975,537 (14,463)
European Economic Unit 7/13/05 (euro) (1,000,000) (1,300,200) (1,293,712) 6,488
European Economic Unit 7/13/05 (euro) (1,700,000) (2,194,020) (2,199,310) (5,290)
European Economic Unit 7/13/05 (euro) (1,300,000) (1,677,780) (1,681,825) (4,045)
Japanese Yen 7/13/05 (Y) 162,800,000 1,521,495 1,561,873 40,378
New Zealand Dollar 7/13/05 NZ$ (1,169,000) (833,497) (849,225) (15,728)
New Zealand Dollar 7/13/05 NZ$ (8,300,000) (5,926,573) (6,029,568) (102,995)
Norwegian Krone 7/13/05 NKr 12,273,000 1,936,919 1,955,014 18,095
Swedish Krona 7/13/05 SKr 13,718,250 1,936,484 1,930,024 (6,460)
----------- ----------- ---------
$(2,754,250) $(2,834,749) $ (80,499)
=========== =========== =========
I) TBA PURCHASE COMMITMENTS -- The Fund may enter into "TBA" (to be
announced) purchase commitments to purchase securities for a fixed price at a
future date, typically not exceeding 45 days. TBA purchase commitments may be
considered securities in themselves, and involve a risk of loss if the value of
the security to be purchased declines prior to settlement date. This risk is in
addition to the risk of decline in the Fund's other assets. Unsettled TBA
purchase commitments are valued at the current market value of the underlying
securities, according to the procedures described under "Security Valuation"
above.
J) FUTURES -- The Fund may enter into futures contracts to the extent
permitted by its investment policies and objectives. Upon entering into a
futures contract, the Fund is required to deposit cash or pledge U.S. Government
securities as initial margin. Subsequent payments, which are dependent on the
daily fluctuations in the value of the underlying instrument, are made or
received by the Fund each day (daily variation margin) and are recorded as
unrealized gains or losses until the contracts are closed. When the contracts
are closed, the Fund records a realized gain or loss equal to the difference
between the proceeds from (or cost of) the closing transactions and the Fund's
basis in the contracts. Risks of entering into futures contracts for hedging
purposes include the possibility that a change in the value of the contract may
not correlate with the changes in the value of the underlying instruments. In
addition, the purchase of a futures contract involves the risk that the Fund
could lose more than the original margin deposit and subsequent
30
CREDIT SUISSE FIXED INCOME FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
payments required for a futures transaction. At April 30, 2005, the Fund had the
following open futures contracts:
UNREALIZED
NUMBER OF EXPIRATION CONTRACT CONTRACT APPRECIATION
FUTURES CONTRACT CONTRACTS DATE AMOUNT VALUE (DEPRECIATION)
-------------------- ------------- ---------- ------------ ------------ --------------
U.S. Treasury 2 Year
Notes Futures 94 6/30/05 $ 19,528,780 $ 19,524,094 $ (4,686)
U.S. Treasury 5 Year
Notes Futures 22 6/21/05 2,384,687 2,385,969 1,282
------------ ------------ ---------
21,913,467 21,910,063 (3,404)
------------ ------------ ---------
U.S. Treasury Bonds
Futures (11) 6/21/05 (1,254,483) (1,263,281) (8,798)
U.S. Treasury 10 Year
Notes Futures (106) 6/21/05 (11,596,891) (11,810,719) (213,828)
------------ ------------ ---------
(12,851,374) (13,074,000) (222,626)
------------ ------------ ---------
$ 9,062,093 $ 8,836,063 $(226,030)
============ ============ =========
K) OPTIONS -- The Fund may purchase and write (sell) call and put options on
securities, currencies and swap agreements (options on swap agreements are
commonly known as "swaptions"). The Fund may write covered and uncovered put and
call options and purchase put and call options for hedging purposes or to
increase total return. The risk associated with purchasing an option is that the
Fund pays a premium whether or not the option is exercised. Additionally, the
Fund bears the risk of loss of premium and change in market value should the
counterparty not perform under the contract. Put and call options purchased are
accounted for in the same manner as portfolio securities. The cost of securities
acquired through the exercise of call options is increased by the premium paid.
The proceeds from securities sold through the exercise of put options are
decreased by the premium paid.
When the Fund writes an option, the premium received by the Fund is recorded
as a liability and is subsequently adjusted to the current market value of the
option written. Premiums received from writing options that expire unexercised
are recorded by the Fund on the expiration date as realized gains from options
transactions. The difference between the premium received and the amount paid on
effecting a closing purchase transaction, including brokerage commissions, is
also treated as a realized gain, or if the premium received is less than the
amount paid for the closing purchase transaction, as a realized loss. If a call
option is exercised, the premium received is added to the proceeds from the sale
of the underlying security in determining whether the Fund has realized a gain
or loss. If a put option is exercised, the premium received reduces the cost
basis of the security purchased by the Fund. The risk
31
CREDIT SUISSE FIXED INCOME FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
involved in writing an option is that, if the option is exercised, the
underlying security could then be purchased or sold by the Fund at a
disadvantageous price. Uncovered options are riskier than covered options
because there is no underlying security held by the Fund that can act as a
partial hedge. Uncovered calls have speculative characteristics and the
potential for loss is unlimited. There is also a risk that the securities on
which the option is written may not be available for purchase if the call option
is exercised. Uncovered put options have speculative characteristics and the
potential loss is substantial.
Exchange-traded options are valued at the last sale price in the market where
such contracts are principally traded. OTC equity index options are priced
according to the contract specifications (days to expiration, current spot index
level, interest rates, dividends, strike price) using the Black-Scholes pricing
model, modified for dividends. The volatility input assumption is interpolated
from the previous day's price. On a weekly basis and at month end, CSAM receives
a price indication sheet from the various broker-dealers and inputs these prices
to update the volatility.
Transactions in written options for puts and calls for the six months ended
April 30, 2005 were as follows:
NUMBER OF PREMIUMS
CONTRACTS RECEIVED
--------- ----------
Options outstanding at beginning of period 105 $ 47,985
Options written 2,130 393,618
Options expired -- --
Options bought to close (2,145) (405,874)
------ ---------
Options outstanding at end of period 90 $ 35,729
====== =========
L) SWAPS -- The Fund may enter into index swaps for hedging purposes or to
seek to increase total return. A swap is an agreement that obligates two parties
to exchange a series of cash flows at specified intervals based upon or
calculated by reference to changes in specified prices or rates for a specified
amount of an underlying asset or notional principal amount. The Fund will enter
into index swaps only on a net basis, which means that the two payment streams
are netted out, with the Fund receiving or paying, as the case may be, only the
net amount of the two payments. Risks may arise as a result of the failure of
the counterparty to the swap contract to comply with the terms of the swap
contract. The loss incurred by the failure of a counterparty is generally
limited to the net interest payment to be received by the Fund, and/or the
termination value at the end of the contract. Therefore, the Fund
32
CREDIT SUISSE FIXED INCOME FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
considers the creditworthiness of each counterparty to a swap contract in
evaluating potential credit risk. Additionally, risks may arise from
unanticipated movements in interest rates or in the value of the underlying
reference asset or index.
The Fund records unrealized gains or losses on a daily basis representing the
value and the current net receivable or payable relating to open swap contracts.
Net amounts received or paid on the swap contract are recorded as realized gains
or losses. Fluctuations in the value of swaps contracts are recorded for
financial statement purposes as unrealized appreciation or depreciation of swap
contracts. Realized gains and losses from terminated swaps are included in net
realized gains/losses on swap contracts transactions. At April 30, 2005 the Fund
had no outstanding swap contracts.
M) SECURITIES LENDING -- Loans of securities are required at all times to be
secured by collateral at least equal to 102% of the market value of domestic
securities on loan (including any accrued interest thereon) and 105% of the
market value of foreign securities on loan (including any accrued interest
thereon). Cash collateral received by the Fund in connection with securities
lending activity may be pooled together with cash collateral for other
funds/portfolios advised by CSAM and may be invested in a variety of
investments, including certain CSAM-advised funds, funds advised by SSB, the
Fund's securities lending agent or money market instruments. However, in the
event of default or bankruptcy by the other party to the agreement, realization
and/or retention of the collateral may be subject to legal proceedings.
SSB has been engaged by the Fund to act as the Fund's securities lending
agent. The Fund's securities lending arrangement provides that the Fund and SSB
will share the net income earned from securities lending activities. During the
six months ended April 30, 2005, total earnings from the Fund's investment in
cash collateral received in connection with securities lending arrangements was
$97,104 of which $89,264 was rebated to borrowers (brokers). The Fund retained
$5,520 from the cash collateral investment and SSB, as lending agent, was paid
$2,320. The Fund may also be entitled to certain minimum amounts of income from
its securities lending activities. Securities lending income is accrued as
earned.
N) OTHER -- Lower-rated debt securities (commonly known as "junk bonds")
possess speculative characteristics and are subject to greater market
33
CREDIT SUISSE FIXED INCOME FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
fluctuations and risk of lost income and principal than higher-rated debt
securities for a variety of reasons. Also, during an economic downturn or
substantial period of rising interest rates, highly leveraged issuers may
experience financial stress which would adversely affect their ability to
service their principal and interest payment obligations, to meet projected
business goals and to obtain additional financing.
In addition, periods of economic uncertainty and changes can be expected to
result in increased volatility of market prices of lower-rated debt securities
and (to the extent the Fund invests in junk bonds) the Fund's net asset value.
The Fund may invest in securities of foreign countries and governments which
involve certain risks in addition to those inherent in domestic investments.
Such risks generally include, among others, currency risks (fluctuations in
currency exchange rates), information risk (key information may be inaccurate or
unavailable) and political risk (expropriation, nationalization or the
imposition of capital or currency controls or punitive taxes). Other risks of
investing in foreign securities include liquidity and valuation risks.
The Fund may be subject to taxes imposed by countries in which it invests
with respect to its investments in issuers existing or operating in such
countries. Such taxes are generally based on income earned or repatriated and
capital gains realized on the sale of such investments. The Fund accrues such
taxes when the related income or gains are earned.
NOTE 3. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES
CSAM serves as investment adviser for the Fund. For its investment advisory
services, CSAM is entitled to receive a fee from the Fund at an annual rate of
0.50% of the Fund's average daily net assets. For the six months ended April 30,
2005, investment advisory fees earned and voluntarily waived were $410,657 and
$228,215, respectively.
Credit Suisse Asset Management Securities, Inc. ("CSAMSI"), an affiliate of
CSAM, and SSB serve as co-administrators to the Fund.
For its co-administrative services, CSAMSI currently receives a fee
calculated at an annual rate of 0.10% of the Fund's average daily net assets.
For the six months ended April 30, 2005, co-administrative services fees earned
by CSAMSI were $82,131.
34
CREDIT SUISSE FIXED INCOME FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
NOTE 3. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES
For its co-administrative services, SSB receives a fee, exclusive of
out-of-pocket expenses, calculated in total for all the Credit Suisse
funds/portfolios co-administered by SSB and allocated based upon relative
average net assets of each fund/portfolio, subject to an annual minimum fee. For
the six months ended April 30, 2005, co-administrative services fees earned by
SSB (including out-of-pocket expenses) were $68,431.
In addition to serving as the Fund's co-administrator, CSAMSI currently
serves as distributor of the Fund's shares. Pursuant to distribution plans
adopted by the Fund pursuant to Rule 12b-1 under the 1940 Act, CSAMSI receives
fees for its distribution services. Advisor Class shares may pay such fee at an
annual rate not to exceed 0.75% of the average daily net assets. This fee is
currently calculated at an annual rate of 0.50% of the average daily net assets
of the Advisor Class shares. For Class A shares of the Fund, the fee is
calculated at an annual rate of 0.25% of the daily average net assets of the
Class A shares. For Class B and Class C shares of the Fund, the fee are
calculated at an annual rate of 1.00% of the average daily net assets of the
Class B and Class C shares of the Fund. Common Class shares do not bear any
distribution fees.
Certain brokers, dealers and financial representatives provide transfer agent
related services to the Fund, and receive compensation for these services from
CSAM. CSAM is then reimbursed by the Fund. For the six months ended April 30,
2005, the Fund reimbursed CSAM $131,450, which is included in the Fund's
transfer agent expense.
For the six months ended April 30, 2005, CSAMSI and its affiliates advised
the Fund that it retained $15 from commissions earned on the sale of the Fund's
Class A shares.
Merrill Corporation ("Merrill"), an affiliate of CSAM, has been engaged by
the Fund to provide certain financial printing and fulfillment services. For the
six months ended April 30, 2005, Merrill was paid $11,083 for its services to
the Fund.
NOTE 4. LINE OF CREDIT
The Fund, together with other funds/portfolios advised by CSAM (collectively,
the "Participating Funds"), participates in a $75 million committed, unsecured
line of credit facility ("Credit Facility") for temporary or emergency purposes
with Deutsche Bank, A.G. as administrative agent and
35
CREDIT SUISSE FIXED INCOME FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
NOTE 4. LINE OF CREDIT
syndication agent and SSB as operations agent. Under the terms of the Credit
Facility, the Participating Funds pay an aggregate commitment fee at a rate of
0.10% per annum on the average unused amount of the Credit Facility, which is
allocated among the Participating Funds in such manner as is determined by the
governing Boards of the Participating Funds. In addition, the Participating
Funds pay interest on borrowings at the Federal Funds rate plus 0.50%. At April
30, 2005 and during the period ended April 30, 2005, the Fund had no borrowings
under the Credit Facility.
NOTE 5. PURCHASES AND SALES OF SECURITIES
For the six months ended April 30, 2005, purchases and sales of investment
securities (excluding short-term investments) and U.S. Government and Agency
Obligations were as follows:
INVESTMENT SECURITIES US GOVERNMENT/AGENCY OBLIGATIONS
--------------------- --------------------------------
Purchases $ 285,006,121 $ 229,567,922
Sales 303,096,781 224,667,184
At April 30, 2005, the identified cost for federal income tax purposes, as
well as the gross unrealized appreciation from investments for those securities
having an excess of value over cost, gross unrealized depreciation from
investments for those securities having an excess of cost over value and the net
unrealized appreciation from investments were $176,168,366, $2,324,492,
$(886,919) and $1,437,573, respectively.
NOTE 6. CAPITAL SHARE TRANSACTIONS
The Fund is authorized to issue an unlimited number of full and fractional
shares of beneficial interest, $.001 par value per share, of which an unlimited
number of shares are classified as Common Class shares, Advisor Class shares,
Class A shares, Class B shares, and Class C shares. Transactions in capital
shares for each class of the fund were as follows:
COMMON CLASS
-------------------------------------------------------
FOR THE SIX MONTHS ENDED FOR THE YEAR ENDED
APRIL 30, 2005 (UNAUDITED) OCTOBER 31, 2004
-------------------------------------------------------
SHARES VALUE SHARES VALUE
----------- ------------ ---------- ------------
Shares sold 729,333 $ 7,300,213 1,765,117 $ 17,536,529
Shares issued in reinvestment
of dividends 238,561 2,385,156 397,120 3,942,591
Shares redeemed (1,461,696) (14,642,249) (4,022,117) (39,854,945)
----------- ------------ ---------- ------------
Net decrease (493,802) $ (4,956,880) (1,859,880) $(18,375,825)
=========== ============ ========== ============
36
CREDIT SUISSE FIXED INCOME FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
NOTE 6. CAPITAL SHARE TRANSACTIONS
ADVISOR CLASS
-------------------------------------------------------
FOR THE SIX MONTHS ENDED FOR THE YEAR ENDED
APRIL 30, 2005 (UNAUDITED) OCTOBER 31, 2004
-------------------------------------------------------
SHARES VALUE SHARES VALUE
----------- ------------ ---------- ------------
Shares sold 81,011 $ 813,365 59,167 $ 583,439
Shares issued in reinvestment
of dividends 22,026 220,292 39,204 389,176
Shares redeemed (275,064) (2,744,443) (448,568) (4,474,273)
----------- ------------ ---------- ------------
Net decrease (172,027) $ (1,710,786) (350,197) $ (3,501,658)
=========== ============ ========== ============
CLASS A
-------------------------------------------------------
FOR THE SIX MONTHS ENDED FOR THE YEAR ENDED
APRIL 30, 2005 (UNAUDITED) OCTOBER 31, 2004
-------------------------------------------------------
SHARES VALUE SHARES VALUE
----------- ------------ ---------- ------------
Shares sold 277,966 $ 2,781,629 440,763 $ 4,374,282
Shares issued in reinvestment
of dividends 56,296 563,462 95,842 952,141
Shares redeemed (387,329) (3,896,052) (960,335) (9,547,906)
----------- ------------ ---------- ------------
Net decrease (53,067) $ (550,961) (423,730) $ (4,221,483)
=========== ============ ========== ============
CLASS B
-------------------------------------------------------
FOR THE SIX MONTHS ENDED FOR THE YEAR ENDED
APRIL 30, 2005 (UNAUDITED) OCTOBER 31, 2004
-------------------------------------------------------
SHARES VALUE SHARES VALUE
----------- ------------ ---------- ------------
Shares sold 131,125 $ 1,308,009 40,551 $ 402,569
Shares issued in reinvestment
of dividends 7,402 74,061 12,358 122,683
Shares redeemed (112,995) (1,131,825) (172,157) (1,690,467)
----------- ------------ ---------- ------------
Net increase (decrease) 25,532 $ 250,245 (119,248) $ (1,165,215)
=========== ============ ========== ============
CLASS C
-------------------------------------------------------
FOR THE SIX MONTHS ENDED FOR THE YEAR ENDED
APRIL 30, 2005 (UNAUDITED) OCTOBER 31, 2004
-------------------------------------------------------
SHARES VALUE SHARES VALUE
----------- ------------ ---------- ------------
Shares sold 50,208 $ 502,446 202,928 $ 2,019,541
Shares issued in reinvestment
of dividends 1,239 12,391 2,166 21,497
Shares redeemed (61,887) (618,508) (124,305) (1,227,240)
----------- ------------ ---------- ------------
Net increase (decrease) (10,440) $ (103,671) 80,789 $ 813,798
=========== ============ ========== ============
37
CREDIT SUISSE FIXED INCOME FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 2005 (unaudited)
- --------------------------------------------------------------------------------
NOTE 6. CAPITAL SHARE TRANSACTIONS
On April 30, 2005, the number of shareholders that held 5% or more of the
outstanding shares of each class of the Fund was as follows:
NUMBER OF APPROXIMATE PERCENTAGE
SHAREHOLDERS OF OUTSTANDING SHARES
------------ ----------------------
Common Class 5 67%
Class A 2 48%
Class B 1 16%
Class C 1 68%
Some of the shareholders are omnibus accounts, which hold shares on behalf of
individual shareholders.
NOTE 7. CONTINGENCIES
In the normal course of business, the Fund may provide general
indemnifications pursuant to certain contracts and organizational documents. The
Fund's maximum exposure under these arrangements is dependent on future claims
that may be made against the Fund and, therefore, cannot be estimated; however,
based on experience, the risk of loss from such claims is considered remote.
38
CREDIT SUISSE FIXED INCOME FUND
BOARD APPROVAL OF ADVISORY AGREEMENT (UNAUDITED)
- --------------------------------------------------------------------------------
In approving the Investment Advisory Agreement, the Board of Trustees of the
Fund, including the Independent Trustees, considered the following factors:
Investment Advisory Fee Rates
-----------------------------
The Board reviewed and considered the contractual advisory fee rate of 0.50%
paid by the Fund (the "Contractual Advisory Fee") to CSAM in light of the extent
and quality of the advisory services provided. The Board also reviewed and
considered the fee waivers and/or expense reimbursement arrangements currently
in place for the Fund and considered the actual fee rate after taking waivers
and reimbursements into account of 0.28% for the Fund (the "Net Advisory Fee").
The Board acknowledged that the fee waivers and reimbursements could be
discontinued at any time.
Additionally, the Board received and considered information comparing the
Fund's Contractual Advisory Fee and Net Advisory Fee and the Fund's overall
expenses with those of funds in both the relevant expense group ("Peer Group")
and universe of funds (the "Universe") provided by an independent provider of
investment company data.
Nature, Extent and Quality of the Services under the Advisory Agreement
-----------------------------------------------------------------------
The Board received and considered information regarding the nature, extent
and quality of services provided to the Fund by CSAM under the Advisory
Agreement. The Board also noted information received at regular meetings
throughout the year related to the services rendered by CSAM. The Board reviewed
background information about CSAM, including its Form ADV. The Board considered
the background and experience of CSAM's senior management and the expertise of,
and the amount of attention given to the Fund by senior personnel of CSAM. In
addition, the Board reviewed the qualifications, backgrounds and
responsibilities of the portfolio management teams primarily responsible for the
day-to-day portfolio management of the Fund and the extent of the resources
devoted to research and analysis of actual and potential investments. The Board
also received and considered information about the nature, extent and quality of
services and fee rates offered to other CSAM clients for comparable services.
Fund Performance
----------------
The Board received and considered the one, three and five-year performance of
the Fund, along with comparisons, for all presented periods, both to the Peer
39
CREDIT SUISSE FIXED INCOME FUND
BOARD APPROVAL OF ADVISORY AGREEMENT (UNAUDITED)(CONTINUED)
- --------------------------------------------------------------------------------
Group and the Universe. The Board was provided with a description of the
methodology used to arrive at the funds included in the Peer Group and the
Universe.
The Board reviewed information comparing the performance of the various
Credit Suisse Funds to performance benchmarks that the Board had previously
established and progress that had been made in certain instances toward
achieving those benchmarks. The Board also reviewed comparisons between the Fund
and its identified benchmark over various time periods.
CSAM Profitability
------------------
The Board received and considered a profitability analysis of CSAM based on
the fees payable under the Advisory Agreement, including any fee waivers or fee
caps, as well as other relationships between the Fund on the one hand and CSAM
affiliates on the other. The Board received profitability information for the
other funds in the CSAM family of funds.
Economies of Scale
------------------
The Board considered whether economies of scale in the provision of services
to the Fund were being passed along to the shareholders. Accordingly, the Board
considered whether alternative fee structures (such as breakpoint fee
structures) would be more appropriate or reasonable taking into consideration
economies of scale or other efficiencies that might accrue from increases in the
Fund's asset levels.
Other Benefits to CSAM
----------------------
The Board considered other benefits received by CSAM and its affiliates as a
result of its relationship with the Fund. Such benefits include, among others,
research arrangements with brokers who execute transactions on behalf of the
Fund, administrative and brokerage relationships with affiliates of CSAM and
benefits potentially derived from an increase in CSAM's businesses as a result
of its relationship with the Fund (such as the ability to market to shareholders
other financial products offered by CSAM and its affiliates).
The Board considered the standards applied in seeking best execution and the
existence of quality controls applicable to brokerage allocation procedures. The
Board also reviewed CSAM's method for allocating portfolio investment
opportunities between the Fund and other advisory clients.
40
CREDIT SUISSE FIXED INCOME FUND
BOARD APPROVAL OF ADVISORY AGREEMENT (UNAUDITED)(CONTINUED)
- --------------------------------------------------------------------------------
Conclusions
-----------
In selecting CSAM, and approving the Advisory Agreement and the investment
advisory fee under such agreement, the Board concluded that:
o although the Contractual Advisory Fee was higher than that of its Peer
Group, the fee was considered reasonable recognizing that the amount that
shareholders were actually charged, the Net Advisory Fee, was
approximately the median of the Fund's Peer Group.
o the Fund's one and two-year performance was above the median of its Peer
Group, while the Fund's three and five-year performance record was below
that of its Peer Group. The Board discussed the underperformance with
CSAM, but considered the improvements in the Fund's recent performance to
be a positive reflection of the enhanced research and portfolio management
changes instituted by CSAM.
o aside from performance (as discussed above), the Board was satisfied with
the nature and extent of the investment advisory services provided to the
Fund by CSAM and that, based on dialogue with management and counsel, the
services provided by CSAM under the Advisory Agreement are typical of, and
consistent with, those provided to mutual funds by other investment
advisers. The Board understood that CSAM had or was in the process of
addressing any performance issues.
o in light of the costs of providing investment management and other
services to the Fund and CSAM's ongoing commitment to the Fund and
willingness to cap fees and expenses, the profits and other ancillary
benefits that CSAM and its affiliates received were considered reasonable.
o CSAM's profitability based on fees payable under the Advisory Agreement
was reasonable in light of the nature, extent and quality of the services
provided to the Fund thereunder.
o in light of the relatively small size of the Fund and the amount of the
Net Advisory Fees, the Fund's current fee structure (without breakpoints)
was considered reasonable.
No single factor reviewed by the Board was identified by the Board as the
principal factor in determining whether to approve the Advisory Agreement. The
Independent Trustees were advised by separate independent legal counsel
throughout the process.
41
CREDIT SUISSE FIXED INCOME FUND
PRIVACY POLICY NOTICE (UNAUDITED)
- --------------------------------------------------------------------------------
Important Privacy Choices for Consumers
---------------------------------------
We are committed to maintaining the privacy of every current and prospective
customer. We recognize that you entrust important personal information to us,
and we wish to assure you that we take seriously our responsibilities in
protecting and safeguarding this information.
In connection with making available investment products and services to
current and potential customers, we may obtain nonpublic personal information
about you. This information may include your name, address, e-mail address,
social security number, account number, assets, income, financial situation,
transaction history and other personal information.
We may collect nonpublic information about you from the following sources:
o Information we receive on applications, forms, questionnaires, web sites,
agreements or in the course of establishing or maintaining a customer
relationship; and
o Information about your transactions with us, our affiliates, or others.
We do not disclose any nonpublic personal information about our customers or
former customers to anyone, except with your consent or as otherwise permitted
by law.
RESTRICT INFORMATION SHARING WITH AFFILIATES: In cases where we believe that
additional products and services may be of interest to you, we may share the
information described above with our affiliates unless you say "No."
[ ] No, please do not share personal and financial information with your
affiliated companies. [If you check this box, you must send this notice
back to us with your name, address and account number to Credit Suisse
Funds, 466 Lexington Avenue, New York, New York 10017.]
We may also disclose this information to firms that perform services on our
behalf. These agents and service providers are required to treat the information
confidentially and use it only for the purpose for which it is provided.
We restrict access to nonpublic personal information about you to those
employees, agents or other parties who need to know that information to provide
products or services to you or in connection with your investments with or
through us. We maintain physical, electronic and procedural safeguards that
comply with federal standards to guard your nonpublic personal information.
Note: This Notice is provided to clients and prospective clients of Credit
Suisse Asset Management, LLC ("CSAM"), and Credit Suisse Asset Management
Securities, Inc., and shareholders and prospective shareholders in
CSAM-sponsored and-advised investment companies, including Credit Suisse Funds,
and other consumers and customers, as applicable. This Notice is not intended to
be incorporated in any offering materials but is merely a statement of our
current Privacy Policy, and may be amended from time to time upon notice to you.
This Notice is dated as of May 17, 2005.
42
CREDIT SUISSE FIXED INCOME FUND
PROXY VOTING AND PORTFOLIO HOLDINGS INFORMATION (UNAUDITED)
- --------------------------------------------------------------------------------
Information regarding how the Fund voted proxies related to its portfolio
securities during the 12-month period ended June 30, 2004 as well as the
policies and procedures that the Fund uses to determine how to vote proxies
relating to its portfolio securities are available:
o By calling 1-800-927-2874
o On the Fund's website, www.csam.com/us
o On the website of the Securities and Exchange Commission,
http://www.sec.gov.
The Fund files a complete schedule of its portfolio holdings for the first
and third quarters of its fiscal year with the SEC on Form N-Q. The Fund's Forms
N-Q are available on the SEC's website at http://www.sec.gov and may be reviewed
and copied at the SEC's Public Reference Room in Washington, DC. Information on
the operation of the SEC's Public Reference Room may be obtained by calling
1-800-SEC-0330.
43
This page intentionally left blank
logo:
P.O. BOX 55030, BOSTON, MA 02205-5030 CREDIT | ASSET
800-927-2874 o www.csam.com/us SUISSE | MANAGEMENT
CREDIT SUISSE ASSET MANAGEMENT SECURITIES, INC., DISTRIBUTOR. FI-SAR-0405
ITEM 2. CODE OF ETHICS.
This item is inapplicable to a semi-annual report on Form N-CSR.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
This item is inapplicable to a semi-annual report on Form N-CSR.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
This item is inapplicable to a semi-annual report on Form N-CSR.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
This item is not applicable to the registrant.
ITEM 6. SCHEDULE OF INVESTMENTS
Included as part of the report to shareholders filed under Item 1 of this Form.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
This item is not applicable to the registrant.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
This item is not applicable to the registrant.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
This item is not applicable to the registrant.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Nominating Committee recommends Board member candidates. Shareholders of the
registrant may also submit nominees that will be considered by the Committee.
Recommendations should be mailed to the registrant's Secretary, c/o Credit
Suisse Asset Management, LLC, 466 Lexington Avenue, New York, NY 10017. Any
submission should include at a minimum the following information: the name, age,
business address, residence address and principal occupation or employment of
such individual; the class, series and number of shares of the registrant that
are beneficially owned by such individual; the date such shares were acquired
and the investment intent of such acquisition; whether such shareholder believes
such individual is, or is not, an "interested person" of the registrant (as
defined in the Investment Company Act of 1940) and information regarding such
individual that is sufficient, in the Committee's discretion, to make such
determination; and all other information relating to such individual that is
required to be disclosed in solicitation of proxies for election of directors in
an election contest (even if an election contest is not involved) or is
otherwise required pursuant to the rules for proxy materials under the
Securities Exchange Act of 1934.
ITEM 11. CONTROLS AND PROCEDURES.
(a) As of a date within 90 days from the filing date of this report, the
principal executive officer and principal financial officer concluded that the
registrant's disclosure controls and procedures (as defined in Rule 30a-3(c)
under the Investment Company Act of 1940 (the "Act")) were effective based on
their evaluation of the disclosure controls and procedures required by Rule
30a-3(b) under the Act and Rules 13a-15(b) or 15d-15(b) under the Securities
Exchange Act of 1934.
(b) There were no changes in registrant's internal control over financial
reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the
registrant's last fiscal half-year that have materially affected, or are
reasonably likely to materially affect, the registrant's internal control over
financial reporting.
ITEM 12. EXHIBITS.
(a)(1) Not applicable.
(a)(2) The certifications of the registrant as required by Rule 30a-2(a) under
the Act are exhibits to this report.
(a)(3) Not applicable.
(b) The certifications of the registrant as required by Rule 30a-2(b) under
the Act are an exhibit to this report.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
Credit Suisse Fixed Income Fund
/s/ Michael E. Kenneally
--------------------------------
Name: Michael E. Kenneally
Title: Chief Executive Officer
Date: July 5, 2005
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.
/s/ Michael E. Kenneally
--------------------------------
Name: Michael E. Kenneally
Title: Chief Executive Officer
Date: July 5, 2005
/s/ Michael A. Pignataro
--------------------------------
Name: Michael A. Pignataro
Title: Chief Financial Officer
Date: July 5, 2005