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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-08448
Pioneer Emerging Markets Fund
(Exact name of registrant as specified in charter)
60 State Street, Boston, MA 02109
(Address of principal executive offices) (ZIP code)
Dorothy E. Bourassa, Pioneer Investment Management, Inc.,
60 State Street, Boston, MA 02109
(Name and address of agent for service)
Registrant's telephone number, including area code: (617) 742-7825
Date of fiscal year end: November 30
Date of reporting period: December 1, 2004 through May 31, 2005
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO SHAREOWNERS.
PIONEER
-----------------------
EMERGING
MARKETS
FUND
Semiannual
Report
5/31/05
[LOGO]
PIONEER
Investments(R)
Table of Contents
- --------------------------------------------------------------------------------
Letter to Shareowners 1
Portfolio Summary 2
Prices and Distributions 3
Performance Update 4
Comparing Ongoing Fund Expenses 9
Portfolio Management Discussion 11
Schedule of Investments 15
Financial Statements 26
Notes to Financial Statements 35
Factors Considered by the Independent Trustees in Approving
the Management Contract 45
Trustees, Officers and Service Providers 50
The Pioneer Family of Mutual Funds 51
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
LETTER TO SHAREOWNERS 5/31/05
- --------------------------------------------------------------------------------
Dear Shareowner,
- --------------------------------------------------------------------------------
U.S. equity markets stumbled early in the year before advancing to three-year
highs in March. Stocks spent much of April retracing their gains, as higher
interest rates and soaring energy prices overwhelmed sentiment. Then a brisk
May rally left the Dow Industrials, the Standard and Poor's 500 Stock Index and
the NASDAQ Composite slightly below year-end levels.
With investors less welcoming of risk and the economy giving mixed signals,
value stocks were more resilient than growth stocks. Large-capitalization
stocks held up better than small- and mid-sized issues that might be seen as
more vulnerable in an economic "soft patch," in the phrase of Federal Reserve
Board Chairman Alan Greenspan. The possibility of slower growth
notwithstanding, the Fed continued to raise short-term rates in an effort to
head off damaging inflation.
Bond returns were modestly negative overall early in the year, and fixed-income
investors more risk-averse. High-yield and other corporate sectors retrenched
after a run of stellar performance while Treasuries and mortgage-backed
securities showed smaller declines. Long-term bond prices rose and their yields
fell, suggesting that investors were not concerned about inflation and offering
a boost to home buyers. Municipal revenue bonds trended higher against a
backdrop of heavy new issuance by states and localities.
Higher U.S. interest rates enhanced the dollar's appeal and brought a pause in
its protracted fall. However, the stronger dollar meant muted returns for U.S.
investors in overseas markets. Globally, economies rich in metals and other
industrial commodities benefited from heavy demand. Meanwhile, growth in Japan
may have stalled, and Europe's halting expansion ran afoul of political issues.
We believe that the U.S. economy and corporate earnings will continue to grow
at a moderate pace. Although oil prices had backed away from their record
highs, steep energy costs and rising interest rates may hold investor attention
for a while. Looking beyond present concerns, Pioneer's global investment
experts continue to find stocks and bonds with attractive long-term potential
for our domestic and international funds.
Expanding your opportunities
This period was like all others; different classes of investments delivered
different returns. That's why allocating your portfolio across several
investment types is one way to seek wider opportunities. Pioneer's disciplined
approach and growing range of products are designed to help you achieve this
important objective. For thoughtful guidance on how to align your portfolio
with your goals, contact your financial professional.
Please consider a fund's investment objective, risks, charges and expenses
carefully before investing. The prospectus contains this and other information
about each fund and should be read carefully before you invest or send money.
To obtain a prospectus and for other information on any Pioneer fund, contact
your financial advisor, call 1-800-225-6292 or visit our web site at
www.pioneerfunds.com.
Respectfully,
/s/ Osbert M. Hood
Osbert M. Hood, President
Pioneer Investment Management, Inc.
Any information in this shareholder report regarding market or economic trends
or the factors influencing the Fund's historical or future performance are
statements of the opinion of Fund management as of the date of this report.
These statements should not be relied upon for any other purposes. Past
performance is no guarantee of future results, and there is no guarantee that
market forecasts discussed will be realized.
1
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
PORTFOLIO SUMMARY 5/31/05
- --------------------------------------------------------------------------------
Sector Distribution
- --------------------------------------------------------------------------------
(As a percentage of equity holdings)
[THE FOLLOWING DATA WAS REPRESENTED AS A PIE GRAPH IN THE PRINTED MATERIAL]
Health Care 0.3%
Utilities 3.3%
Telecommunication Services 7.3%
Consumer Staples 7.6%
Consumer Discretionary 10.2%
Information Technology 10.3%
Industrials 11.9%
Energy 12.6%
Materials 15.0%
Financials 21.5%
Geographical Distribution
- --------------------------------------------------------------------------------
(As a percentage of equity holdings)
[THE FOLLOWING DATA WAS REPRESENTED AS A BAR CHART IN THE PRINTED MATERIAL]
South Korea 22.1%
Brazil 13.9%
Taiwan 12.2%
South Africa 8.9%
India 8.1%
People's Republic of China 4.5%
Turkey 4.3%
Thailand 3.8%
Russia 3.4%
Mexico 3.2%
Indonesia 3.1%
Malaysia 3.1%
Peru 1.2%
Argentina 1.2%
Phillippines 1.2%
Hong Kong 0.9%
Other (Individually less than 1%) 4.9%
10 Largest Holdings
- --------------------------------------------------------------------------------
(As a percentage of equity holdings)*
1. Petrobras Brasileiro (A.D.R.) 5.09%
2. Samsung Electronics 4.33
3. AngloGold Ashanti, Ltd. (A.D.R.) 1.66
4. Hyundai Motor Co., Ltd. 1.62
5. Anglo American Platinum Corp., Ltd. 1.53
6. Kookmin Bank (A.D.R) 1.22
7. Compania de Minas Buenaventura SA 1.22
8. Fomento Economico Mexicano, SA de CV 1.14
9. Surgutneftegaz (A.D.R.) 1.13
10. Hon Hai Precision Industry 1.10
* This list excludes temporary cash and derivative investments. The portfolio
is actively managed, and current holdings may be different.
2
Pioneer Emerging Markets Fund
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PRICES AND DISTRIBUTIONS
- -----------------------------------------------------------------------------
Net Asset Value Per Share
- -----------------------------------------------------------------------------
Class 5/31/05 11/30/04
- ------- --------- ---------
A $19.11 $17.88
B $17.60 $16.52
C $17.54 $16.47
R $18.91 $17.72
Y $20.14 $18.78
Distributions Per Share
- -----------------------------------------------------------------------------
12/1/04 - 5/31/05
-----------------
Net
Investment Short-Term
Class Income Capital Gains
- ------- ------------ ---------------
A $ - $ -
B $ - $ -
C $ - $ -
R $ - $ -
Y $ - $ -
3
Pioneer Emerging Markets Fund
- -----------------------------------------------------------------------------
PERFORMANCE UPDATE 5/31/05 CLASS A SHARES
- -----------------------------------------------------------------------------
Investment Returns
-----------------------------------------------------------------------------
The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Emerging Markets Fund at public offering price,
compared to that of the Morgan Stanley Capital International (MSCI)
Emerging Markets Index.
[THE FOLLOWING DATA WAS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL]
Value of $10,000 Investment
Date Value MSCI Emerging
Markets Index
5/31/1995 $9,423 $10,000
$11,869 $10,813
5/31/1997 $13,356 $11,651
$12,190 $8,355
5/31/1999 $10,560 $8,644
$14,697 $10,180
5/31/2001 $10,376 $7,982
$11,209 $8,563
5/31/2003 $10,841 $8,014
$14,508 $11,330
5/31/2005 $18,558 $14,743
Average Annual Total Returns
(As of May 31, 2005)
Net Asset Public
Value Offering Price
Period (NAV) (POP)
10 Years 7.01% 6.38%
5 Years 4.78 3.54
1 Year 27.91 20.49
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent
month-end performance results. Current performance may be lower or higher
than the performance data quoted.
The performance data quoted represents past performance, which is no
guarantee of future results. Investment return and principal value will
fluctuate, and shares, when redeemed, may be worth more or less than their
original cost.
POP returns reflect deduction of maximum 5.75% sales charge. NAV results
represent the percent change in net asset value per share. Returns would
have been lower had sales charges been reflected. All results are
historical and assume the reinvestment of dividends and capital gains.
Other share classes are available for which performance and expenses will
differ.
Performance results reflect any applicable expense waivers in effect during
the periods shown. Without such waivers Fund performance would be lower.
Waivers may not be in effect for all funds. Certain fee waivers are
contractual through a specified period. Otherwise, fee waivers can be
rescinded at any time. See the prospectus and financial statements for more
information.
The performance table and graph do not reflect the deduction of fees and
taxes that a shareowner would pay on Fund distributions or the redemption
of Fund shares.
The MSCI Emerging Markets Index measures the performance of emerging market
stocks. Index returns are calculated monthly, assume reinvestment of
dividends and, unlike Fund returns, do not reflect any sales charges, fees
or expenses. You cannot invest directly in an Index.
4
Pioneer Emerging Markets Fund
- -----------------------------------------------------------------------------
PERFORMANCE UPDATE 5/31/05 CLASS B SHARES
- -----------------------------------------------------------------------------
Investment Returns
-----------------------------------------------------------------------------
The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Emerging Markets Fund, compared to that of the
Morgan Stanley Capital International (MSCI) Emerging Markets Index.
[THE FOLLOWING DATA WAS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL]
Value of $10,000 Investment
Date Value MSCI Emerging
Markets Index
5/31/1995 $10,000 $10,000
$12,523 $10,813
5/31/1997 $13,985 $11,651
$12,671 $8,355
5/31/1999 $10,883 $8,644
$15,023 $10,180
5/31/2001 $10,510 $7,982
$11,278 $8,563
5/31/2003 $10,821 $8,014
$14,390 $11,330
5/31/2005 $18,260 $14,743
Average Annual Total Returns
(As of May 31, 2005)
If If
Period Held Redeemed
10 Years 6.21% 6.21%
5 Years 3.98 3.98
1 Year 26.89 22.89
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent
month-end performance results. Current performance may be lower or higher
than the performance data quoted.
The performance data quoted represents past performance, which is no
guarantee of future results. Investment return and principal value will
fluctuate, and shares, when redeemed, may be worth more or less than their
original cost.
"If redeemed" returns reflect the deduction of applicable contingent
deferred sales charge (CSDC). Effective December 1, 2004, the period during
which a CDSC is applied to withdrawals was shortened to 5 years. The
maximum CDSC for class B shares continues to be 4%. For more complete
information, please see the prospectus for details. "If Held" results
represent the percent change in net asset value per share. Returns would
have been lower had sales charges been reflected. Note: Shares purchased
prior to December 1, 2004 remain subject to the CDSC in effect at the time
you purchased those shares. For performance information for shares
purchased prior to December 1, 2004, please visit
www.pioneerfunds.com/bshares.
All results are historical and assume the reinvestment of dividends and
capital gains. Other share classes are available for which performance and
expenses will differ.
Performance results reflect any applicable expense waivers in effect during
the periods shown. Without such waivers Fund performance would be lower.
Waivers may not be in effect for all funds. Certain fee waivers are
contractual through a specified period. Otherwise, fee waivers can be
rescinded at any time. See the prospectus and financial statements for more
information.
The performance table and graph do not reflect the deduction of fees and
taxes that a shareowner would pay on Fund distributions or the redemption
of Fund shares.
The MSCI Emerging Markets Index measures the performance of emerging market
stocks. Index returns are calculated monthly, assume reinvestment of
dividends and, unlike Fund returns, do not reflect any sales charges, fees
or expenses. You cannot invest directly in an Index.
5
Pioneer Emerging Markets Fund
- -----------------------------------------------------------------------------
PERFORMANCE UPDATE 5/31/05 CLASS C SHARES
- -----------------------------------------------------------------------------
Investment Returns
-----------------------------------------------------------------------------
The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Emerging Markets Fund at public offering price,
compared to that of the Morgan Stanley Capital International (MSCI)
Emerging Markets Index.
[THE FOLLOWING DATA WAS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL]
Value of $10,000 Investment
Date Value MSCI Emerging
Markets Index
1/31/1996 $10,000 $10,000
$10,870 $10,268
5/31/1997 $12,139 $11,064
$10,997 $7,934
5/31/1999 $9,390 $8,209
$12,932 $9,668
5/31/2001 $9,075 $7,580
$9,742 $8,132
5/31/2003 $9,363 $7,611
$12,437 $10,759
5/31/2005 $15,807 $14,001
Average Annual Total Returns
(As of May 31, 2005)
If If
Period Held Redeemed
Life-of-Class
(1/31/1996) 5.03% 5.03%
5 Years 4.10 4.10
1 Year 27.10 27.10
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent
month-end performance results. Current performance may be lower or higher
than the performance data quoted.
The performance data quoted represents past performance, which is no
guarantee of future results. Investment return and principal value will
fluctuate, and shares, when redeemed, may be worth more or less than their
original cost.
Class C shares held for less than one year are also subject to a 1%
contingent deferred sales charge (CDSC). The performance of Class C shares
does not reflect the 1% front-end sales charge in effect prior to February
1, 2004. If you paid a 1% sales charge, your returns would be lower than
those shown above. "If Held" results represent the percent change in net
asset value per share. Returns would have been lower had sales charges been
reflected. All results are historical and assume the reinvestment of
dividends and capital gains. Other share classes are available for which
performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during
the periods shown. Without such waivers Fund performance would be lower.
Waivers may not be in effect for all funds. Certain fee waivers are
contractual through a specified period. Otherwise, fee waivers can be
rescinded at any time. See the prospectus and financial statements for more
information.
The performance table and graph do not reflect the deduction of fees and
taxes that a shareowner would pay on Fund distributions or the redemption
of Fund shares.
The MSCI Emerging Markets Index measures the performance of emerging market
stocks. Index returns are calculated monthly, assume reinvestment of
dividends and, unlike Fund returns, do not reflect any sales charges, fees
or expenses. You cannot invest directly in an Index.
6
Pioneer Emerging Markets Fund
- -----------------------------------------------------------------------------
PERFORMANCE UPDATE 5/31/05 CLASS R SHARES
- -----------------------------------------------------------------------------
Investment Returns
-----------------------------------------------------------------------------
The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Emerging Markets Fund, compared to that of the
Morgan Stanley Capital International (MSCI) Emerging Markets Index.
[THE FOLLOWING DATA WAS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL]
Value of $10,000 Investment
Date Value MSCI Emerging
Markets Index
5/31/1995 $10,000 $10,000
$12,530 $10,813
5/31/1997 $14,022 $11,651
$12,737 $8,355
5/31/1999 $10,978 $8,644
$15,208 $10,180
5/31/2001 $10,682 $7,982
$11,482 $8,563
5/31/2003 $11,057 $8,014
$14,853 $11,330
5/31/2005 $18,889 $14,743
Average Annual Total Returns
(As of May 31, 2005)
If If
Period Held Redeemed
10 Years 6.57% 6.57%
5 Years 4.43 4.43
1 Year 27.17 27.17
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent
month-end performance results. Current performance may be lower or higher
than the performance data quoted.
The performance data quoted represents past performance, which is no
guarantee of future results. Investment return and principal value will
fluctuate, and shares, when redeemed, may be worth more or less than their
original cost.
The performance of Class R shares for the period prior to the commencement
of operations of Class R shares on April 1, 2003 is based on the
performance of Class A shares, reduced to reflect the higher distribution
and service fees of Class R shares. For the period after April 1, 2003, the
actual performance of Class R shares is reflected, which performance may be
influenced by the smaller asset size of Class R shares compared to Class A
shares. Class R shares are not subject to sales charges and are available
for limited groups of eligible investors, including institutional
investors. All results are historical and assume the reinvestment of
dividends and capital gains. Other share classes are available for which
performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during
the periods shown. Without such waivers Fund performance would be lower.
Waivers may not be in effect for all funds. Certain fee waivers are
contractual through a specified period. Otherwise, fee waivers can be
rescinded at any time. See the prospectus and financial statements for more
information.
The performance table and graph do not reflect the deduction of fees and
taxes that a shareowner would pay on Fund distributions or the redemption
of Fund shares.
The MSCI Emerging Markets Index measures the performance of emerging market
stocks. Index returns are calculated monthly, assume reinvestment of
dividends and, unlike Fund returns, do not reflect any sales charges, fees
or expenses. You cannot invest directly in an Index.
7
Pioneer Emerging Markets Fund
- -----------------------------------------------------------------------------
PERFORMANCE UPDATE 5/31/05 CLASS Y SHARES
- -----------------------------------------------------------------------------
Investment Returns
---------------------------------------------------------------------------
The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Emerging Markets Fund, compared to that of the
Morgan Stanley Capital International (MSCI) Emerging Markets Index.
Value of $10,000 Investment
Date Value MSCI Emerging
Markets
5/31/1995 $10,000 $10,000
$12,596 $10,813
5/31/1997 $14,174 $11,651
$12,957 $8,355
5/31/1999 $11,320 $8,644
$15,854 $10,180
5/31/2001 $11,258 $7,982
$12,296 $8,563
5/31/2003 $12,019 $8,014
$16,240 $11,330
5/31/2005 $20,926 $14,743
Average Annual Total Returns
(As of May 31, 2005)
If If
Period Held Redeemed
10 Years 7.66% 7.66%
5 Years 5.71 5.71
1 Year 28.86 28.86
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent
month-end performance results. Current performance may be lower or higher
than the performance data quoted.
The performance data quoted represents past performance, which is no
guarantee of future results. Investment return and principal value will
fluctuate, and shares, when redeemed, may be worth more or less than their
original cost.
Performance for periods prior to the inception of Class Y shares reflects
the NAV performance of the Fund's Class A shares. The performance does not
reflect differences in expenses, including the Rule 12b-1 fees applicable
to Class A shares. Since fees for Class A shares are generally higher than
those of Class Y shares, the performance shown for Y shares prior to their
inception would have been higher. Class A shares are used as a proxy from
6/23/94 to 4/9/98. Class Y shares are not subject to sales charges and are
available for limited groups of eligible investors, including institutional
investors. All results are historical and assume the reinvestment of
dividends, and capital gains. Other share classes are available for which
performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during
the periods shown. Without such waivers Fund performance would be lower.
Waivers may not be in effect for all funds. Certain fee waivers are
contractual through a specified period. Otherwise, fee waivers can be
rescinded at any time. See the prospectus and financial statements for more
information.
The performance table and graph do not reflect the deduction of fees and
taxes that a shareowner would pay on Fund distributions or the redemption
of Fund shares.
The MSCI Emerging Markets Index measures the performance of emerging market
stocks. Index returns are calculated monthly, assume reinvestment of
dividends and, unlike Fund returns, do not reflect any sales charges, fees
or expenses. You cannot invest directly in an Index.
8
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
COMPARING ONGOING FUND EXPENSES
- --------------------------------------------------------------------------------
As a shareowner in the Fund, you incur two types of costs:
(1) ongoing costs, including management fees, distribution and/or service
(12b-1) fees, and other Fund expenses; and
(2) transaction costs, including sales charges (loads) on purchase payments and
redemption fees.
This example is intended to help you understand your ongoing expenses (in
dollars) of investing in the Fund and to compare these costs with the ongoing
costs of investing in other mutual funds. The example is based on an investment
of $1,000 at the beginning of the Fund's latest six-month period and held
throughout the six months.
Using the Tables
Actual Expenses
The first table below provides information about actual account values and
actual expenses. You may use the information in this table, together with the
amount you invested, to estimate the expenses that you paid over the period as
follows:
1. Divide your account value by $1,000
Example: an $8,600 account value - $1,000 = 8.6
2. Multiply the result in (1) above by the corresponding share class's number
in the third row under the heading entitled "Expenses Paid During Period"
to estimate the expenses you paid on your account during this period.
Expenses Paid on a $1,000 Investment in Pioneer Emerging Markets Fund
Based on actual returns from December 1, 2004 through May 31, 2005.
Share Class A B C R Y
- ---------------------------------------------------------------------------------------------
Beginning Account Value $1,000.00 $1,000.00 $1,000.00 $1,000.00 $1,000.00
On 12/1/04
Ending Account Value $1,068.80 $1,065.40 $1,065.00 $1,067.20 $1,072.40
(after expenses)
On 5/31/05
Expenses Paid $ 11.09 $ 14.98 $ 14.42 $ 12.73 $ 7.23
During Period*
* Expenses are equal to the Fund's annualized expense ratio of 2.15%, 2.91%,
2.80%, 2.47%, and 1.40% for Class A, Class B, Class C, Class R and Class Y
shares, respectively, multiplied by the average account value over the
period, multiplied by 182/365 (to reflect the one-half year period).
9
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
COMPARING ONGOING FUND EXPENSES (continued)
- --------------------------------------------------------------------------------
Hypothetical Example for Comparison Purposes
The table below provides information about hypothetical account values and
hypothetical expenses based on the Fund's actual expense ratio and an assumed
rate of return of 5% per year before expenses, which is not the Fund's actual
return. The hypothetical account values and expenses may not be used to
estimate the actual ending account balance or expenses you paid for the period.
You may use this information to compare the ongoing costs of investing in the
Fund and other funds. To do so, compare this 5% hypothetical example with the
5% hypothetical examples that appear in the shareholder reports of the other
funds.
Please note that the expenses shown in the tables are meant to highlight your
ongoing costs only and do not reflect any transaction costs, such as sales
charges (loads), or redemption fees that are charged at the time of the
transaction. Therefore, the table below is useful in comparing ongoing costs
only and will not help you determine the relative total costs of owning
different funds. In addition, if these transaction costs were included, your
costs would have been higher.
Expenses Paid on a $1,000 Investment in Pioneer Emerging Markets Fund
Based on a hypothetical 5% return per year before expenses, reflecting the
period from December 1, 2004 through May 31, 2005.
Share Class A B C R Y
- ---------------------------------------------------------------------------------------------
Beginning Account Value $1,000.00 $1,000.00 $1,000.00 $1,000.00 $1,000.00
On 12/1/04
Ending Account Value $1,014.21 $1,010.42 $1,010.97 $1,012.62 $1,017.95
(after expenses)
On 5/31/05
Expenses Paid $ 10.80 $ 14.59 $ 14.04 $ 12.39 $ 7.04
During Period*
* Expenses are equal to the Fund's annualized expense ratio of 2.15%, 2.91%,
2.80%, 2.47%, and 1.40% for Class A, Class B, Class C, Class R and Class Y
shares, respectively, multiplied by the average account value over the
period, multiplied by 182/365 (to reflect the one-half year period).
10
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
PORTFOLIO MANAGEMENT DISCUSSION 5/31/05
- --------------------------------------------------------------------------------
In the following interview, Christopher Smart and Sam Polyak, Pioneer Emerging
Market Fund's Portfolio Managers, discuss the factors that influenced
performance during the six months ended May 31, 2005.
The Fund modestly underperformed both its benchmark and its peer group for the
period. The Class A shares of the Fund produced a total return of 6.88% at net
asset value for the six-month period ended May 31, 2005, trailing the 7.66%
return of the MSCI Emerging Markets Index. The return of the Fund's Class A
shares was slightly below the 7. 08% average return of the 183 funds in their
Lipper peer group, Emerging Markets Funds.
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end
performance results. Current performance may be lower or higher than the
performance data quoted.
The performance data quoted represents past performance, which is no guarantee
of future results. Investment return and principal value will fluctuate, and
shares, when redeemed, may be worth more or less than their original cost.
Q: How did emerging markets equities perform during the Fund's semiannual
reporting period?
A: The asset class outpaced the developed markets amid an environment of
steady worldwide growth, falling long-term interest rates, and strong
commodity prices. Emerging markets equities performed very well in the
first half of the reporting period, but the investment environment turned
more challenging in March. As continued high oil prices triggered fears
of rising inflation and more aggressive interest rate hikes by the U.S.
Federal Reserve, heightened risk aversion among investors led to a sharp
decline in most global equities markets and in the emerging markets in
particular. Still, we maintained our longer term view that the outlook
for the stocks in our portfolio remains promising.
Q: Did this shifting environment affect the way you managed the Fund?
A: On the margin, yes. Although we generally buy stocks with a 12- to 18-month
time horizon, we will sell them if we think that market excesses have
driven them much above their intrinsic values. We therefore established a
more conservative positioning in late February following several months
of strong performance
11
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
PORTFOLIO MANAGEMENT DISCUSSION 5/31/05 (continued)
- --------------------------------------------------------------------------------
for emerging markets stocks. We reduced our exposure to more volatile
markets such as India and Brazil, which helped performance when the global
stock markets weakened during March and April. When this drop caused many
of our favored companies to fall back into more attractive valuation
ranges, we took advantage of the more attractive valuations to add them to
the portfolio. Specifically, we increased the Fund's exposure to stocks
that can benefit from the recovery of domestic consumption we continued to
expect in countries such as Korea. We also increased our holdings in
select technology stocks that were showing signs of improving sales
growth.
Q: What were some notable causes for the Fund's underperformance?
A: Our position in Russian oil stocks was the largest detractor from
performance. While the economy continues to grow rapidly and benefit from
high global oil prices, the Russian government's aggressive efforts to
dismantle the oil giant Yukos dealt a severe blow to investor sentiment.
This led to a sharp decline in Russian stocks, and the Fund's positions
in Gazprom, Lukoil, and Surgutneftegaz underperformed. Fund performance
also was hurt by our holdings in Thailand, which suffered from rising
interest rates and a subsequent slowdown in the economy. Both weighed
heavily on holdings such as Siam Cement and Siam Commercial Bank.
Q: What elements of the portfolio's positioning were positive for performance?
A: Our stock selection in South Korea and Brazil, which are among the Fund's
top country weightings, was helpful to performance. In Brazil, we
benefited from positions in Natura Comesticos, which sells cosmetics
door-to-door, and the retail banking concern Unibanco, which enjoyed a
strong resurgence in lending. Our holdings in Korean shipbuilding stocks,
such as Daewoo Shipbuilding and Samsung Heavy, were also helpful as the
demand for new ships continued to grow. Two utilities also contributed to
performance: Samchully, which distributes natural gas to a growing number
of households in Korea, and Korean Electric Power, which benefited as a
recovery in the Korean currency - the won - helped reduce its foreign
debt burden.
12
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Q: What is your overall view of the asset class, and where are you finding the
most compelling opportunities?
A: We retain a positive view on emerging markets. We believe the U.S. Federal
Reserve will continue to raise interest rates, but not fast enough to
dampen growth in our markets significantly. We also believe that growth
in China, while likely to slow somewhat, will not suffer the collapse
that some investors fear. That should help support demand for key
commodities from many emerging markets. Finally, valuations returned to
attractive levels, in our view, following the March decline. The
price-to-earnings (p/e) ratio of the MSCI Emerging Markets Index is about
60% of the developed markets ratio, despite the fact that earnings growth
is actually stronger in many emerging markets. Those factors, in
combination, should provide a positive underpinning for the asset class.
Specifically, the case for investing in China may be growing more
compelling. Valuations have returned to reasonable levels after two years
of underperformance for the country's stock market, particularly among
companies that benefit from the growing wealth of the Chinese consumer.
They include China Life, the country's largest life insurance company, and
Panva Gas Holdings, which distributes natural gas to retail customers.
India also remains a compelling opportunity, as we believe the
government's efforts to enact economic reforms will help release pent-up
consumer demand. Brazil, where a likely decline in interest rates should
provide an additional spark to the consumer sector, also looks more
attractive.
Overall, we remain confident that our disciplined investment approach,
which incorporates the analysis of both countries and individual
companies, will help the Fund to take advantage of the positive long-term
trends unfolding in many emerging markets.
Investing in foreign and/or emerging markets securities involves risks relating
to interest rates, currency exchange rates, economic, and political conditions.
Because the portfolio invests in a limited number of companies, a change in one
security's value may have a more significant effect on the portfolio's value.
The portfolio focuses on companies in a limited number of sectors making it
more susceptible to adverse economic, political, or regulatory developments
affecting those sectors than a portfolio that invests more broadly. Investing
in small and mid-sized companies may have the potential for higher returns, but
are also subject to greater short-term price fluctuations than larger, more
established companies.
13
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
PORTFOLIO MANAGEMENT DISCUSSION 5/31/05 (continued)
- --------------------------------------------------------------------------------
Any information in this shareholder report regarding market or economic trends
or the factors influencing the Fund's historical or future performance are
statements of the opinion of Fund management as of the date of this report.
These statements should not be relied upon for any other purposes. Past
performance is no guarantee of future results, and there is no guarantee that
market forecasts discussed will be realized.
14
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 5/31/05 (unaudited)
- --------------------------------------------------------------------------------
Shares Value
PREFERRED STOCKS - 3.3%
Capital Goods - 0.2%
Industrial Conglomerates - 0.2%
28,470 LG Corp.* $ 436,547
------------
Total Capital Goods $ 436,547
------------
Media - 0.5%
Broadcasting & Cable Television - 0.5%
4,827,600 Net Servicos de Comunicacao SA* $ 1,303,131
------------
Total Media $ 1,303,131
------------
Banks - 1.1%
Diversified Banks - 1.1%
13,973 Banco Itau Holding Financeira $ 2,460,420
------------
Total Banks $ 2,460,420
------------
Telecommunication Services - 0.6%
Integrated Telecommunication Services - 0.6%
92,894 Tele Norte Leste Participacoes (A.D.R.) (c) $ 1,416,634
------------
Total Telecommunication Services $ 1,416,634
------------
Utilities - 0.9%
Electric Utilities - 0.9%
293,803 Centrais Electricas Brasileiras SA (A.D.R.)*(c) $ 2,037,524
------------
Total Utilities $ 2,037,524
------------
TOTAL PREFERRED STOCKS
(Cost $6,316,367) $ 7,654,256
------------
COMMON STOCKS - 94.0%
Energy - 12.2%
Coal & Consumable Fuels - 0.5%
1,412,000 Yanzhou Coal Mining (Class H) $ 1,121,152
------------
Integrated Oil & Gas - 7.5%
1,767,000 CNOOC, Ltd. $ 972,542
71,210 Gazprom - Reg S (A.D.R.)* 2,406,286
273,100 Petrobras Brasileiro (A.D.R.)* 11,442,890
75,000 Surgutneftegaz (A.D.R.)*(c) 2,539,950
------------
$ 17,361,668
------------
The accompanying notes are an integral part of these financial statements. 15
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 5/31/05 (unaudited) (continued)
- --------------------------------------------------------------------------------
Shares Value
Oil & Gas Equipment & Services - 0.7%
19,700 Samchully Co., Ltd.* $ 1,558,454
------------
Oil & Gas Exploration & Production - 2.1%
2,684,500 China Petroleum & Chemical $ 993,064
18,300 Mol Magyar Olaj 1,364,153
2,994,000 Panva Gas Holdings, Ltd.* 1,212,696
257,700 PTT Public Co., Ltd. 1,249,339
------------
$ 4,819,252
------------
Oil & Gas Refining & Marketing - 0.8%
12,210,800 Petron Corp. $ 737,653
47,200 Repsol SA (A.D.R.) (c) 1,182,832
------------
$ 1,920,485
------------
Oil & Gas Storage & Transporation - 0.6%
86,048,385 Ultrapar Participacoes S.A. $ 1,482,977
------------
Total Energy $ 28,263,988
------------
Materials - 14.6%
Commodity Chemicals - 1.6%
23,289 Daelim Industrial Co.* $ 1,117,869
97,400 Reliance Industries, Ltd. (144A) 2,444,740
------------
$ 3,562,609
------------
Construction Materials - 3.4%
327,163 Akcansa Cimento AS $ 1,114,687
38,930 Asia Cement Co., Ltd.* 1,311,874
692,400 Aveng, Ltd.* 1,169,840
4,461,400 Lafarge Malayan Cement Bhd. 692,877
2,800,000 PT Indocement Tunggal Prakarsa Tbk* 938,403
170,000 Siam Cement Public Co., Ltd. (Foreign Shares) 1,020,273
78,000 Siam City Cement Co., Ltd. (Foreign Shares) 545,146
154,300 Ultra Tech Cement, Ltd. 1,144,754
------------
$ 7,937,854
------------
Diversified Chemicals - 0.5%
2,140,664 Sinopac Holdings Co. $ 1,139,746
------------
16 The accompanying notes are an integral part of these financial statements.
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Shares Value
Diversified Metals & Mining - 2.5%
81,000 Anglo American Platinum Corp., Ltd. $ 3,431,073
47,200 Companhia Vale do Rio Doce (A.D.R.) 1,164,896
33,700 Freeport-McMoRan Copper & Gold, Inc. (Class B) 1,189,610
------------
$ 5,785,579
------------
Fertilizers & Agricultural Chemicals - 0.7%
259,560 Makhteshim-Agan Industries, Ltd. $ 1,572,571
------------
Gold - 1.1%
196,200 IAMGOLD Corp. $ 1,265,490
5,792,000 Zijin Mining Group Co., Ltd. 1,180,457
------------
$ 2,445,947
------------
Paper Products - 0.4%
28,000 Aracruz Cellulose SA (A.D.R.) $ 943,040
------------
Precious Metals & Minerals - 3.3%
109,000 AngloGold Ashanti, Ltd. (A.D.R.) (c) $ 3,743,060
127,900 Compania de Minas Buenaventura SA 2,734,502
4,676,200 PT Aneka Tambang TBK 1,151,561
------------
$ 7,629,123
------------
Specialty Chemicals - 0.5%
712,816 Formosa Plastic Corp. $ 1,211,880
------------
Steel - 0.6%
96,170 Remgro, Ltd. $ 1,466,620
------------
Total Materials $ 33,694,969
------------
Capital Goods - 8.4%
Building Products - 0.9%
15,830 Hanil Cement Co., Ltd.* $ 876,521
353,700 Trakya Cam Sanayii AS* 1,127,424
------------
$ 2,003,945
------------
Construction & Engineering - 3.2%
2,436,073 CTCI Corp. $ 1,288,782
3,310,700 Empressa ICA Sociedad Controladora SA de C.V.* 1,309,600
65,300 GS Engineering & Construction Corp.* 2,031,369
75,000 Kyeryong Construction Industrial Co., Ltd.* 1,565,612
48,200 Larsen & Toubro, Ltd.* 1,152,916
------------
$ 7,348,279
------------
The accompanying notes are an integral part of these financial statements. 17
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 5/31/05 (unaudited) (continued)
- --------------------------------------------------------------------------------
Shares Value
Electrical Components & Equipment - 0.9%
98,000 Bharat Heavy Electricals (Demat Shares)* $ 1,971,451
------------
Industrial Conglomerates - 1.5%
173,900 Copec-Compania Petroleos $ 1,412,053
268,522 KOC Holding AS* 1,134,294
38,900 LG Corp.* 994,351
------------
$ 3,540,698
------------
Industrial Machinery - 1.9%
116,800 Daewoo Heavy Industries & Machinery, Ltd.* $ 2,350,287
140,700 Doosan Heavy Industries & Construction Co.* 1,132,269
2,042,000 Yungtay Engineering Co., Ltd. 1,065,405
------------
$ 4,547,961
------------
Total Capital Goods $ 19,412,334
------------
Commercial Services & Supplies - 1.0%
Data Processing Services - 0.5%
1,235,300 Shinawatra Computer Co., Plc $ 1,124,796
------------
Diversified Commercial Services - 0.5%
127,772 Bidvest Group, Ltd. $ 1,294,741
------------
Total Commercial Services & Supplies $ 2,419,537
------------
Transportation - 2.0%
Marine - 2.0%
1,478,000 China Shipping Development Co., Ltd.* $ 1,177,878
278,000 Malaysia International Shipping Bhd. 1,263,763
252,000 Samsung Heavy Industries Co., Ltd.* 2,107,259
------------
$ 4,548,900
------------
Total Transportation $ 4,548,900
------------
Automobiles & Components - 3.6%
Automobile Manufacturers - 3.0%
43,570 Hyundai Heavy Industries* $ 2,300,679
64,900 Hyundai Motor Co., Ltd.* 3,633,966
108,140 Tata Motors 1,068,747
------------
$ 7,003,392
------------
Motorcycle Manufacturers - 0.6%
47,000 Bajaj Auto, Ltd. (Demat Shares) $ 1,316,674
------------
Total Automobiles & Components $ 8,320,066
------------
18 The accompanying notes are an integral part of these financial statements.
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Shares Value
Hotels, Restaurants & Leisure - 0.8%
Hotels, Resorts & Cruise Lines - 0.8%
126,700 Indian Hotels Co., Ltd. $ 1,932,894
------------
Total Hotels, Restaurants & Leisure $ 1,932,894
------------
Media - 5.0%
Advertising - 0.4%
53,080 G2R Inc.* $ 970,564
------------
Broadcasting & Cable Television - 2.9%
1,320,000 ABS-CBN Broadcasting Corp. $ 265,379
2,800,000 BEC World Public Co., Ltd. (Foreign Shares)* 854,436
38,231 Grupo Televisa SA (A.D.R.)* 2,293,860
4,882,000 Media Prima Bhd.* 2,118,778
233,000 Television Broadcasts, Ltd.* 1,188,860
------------
$ 6,721,313
------------
Movies & Entertainment - 0.8%
1,071,800 Grammy Entertainment Plc (Foreign Shares) $ 342,892
469,500 Zee Telefilms, Ltd. 1,491,552
------------
$ 1,834,444
------------
Publishing - 0.9%
1,034,627 Hurriyet Gazetecilik ve Matbaacilik AS $ 1,976,780
------------
Total Media $ 11,503,101
------------
Food & Drug Retailing - 3.4%
Food Distributors - 0.5%
177,000 Massmart Holdings, Ltd.* $ 1,107,396
------------
Food Retail - 2.9%
76,700 Brasil Distributor Pao Acu (A.D.R.) $ 1,664,390
31,500 CJ Corp.* 2,246,085
30,600 Hyundai Department Store Co., Ltd.* 1,443,567
760,000 President Chain Store Corp. 1,390,300
------------
$ 6,744,342
------------
Total Food & Drug Retailing $ 7,851,738
------------
Food, Beverage & Tobacco - 2.7%
Brewers - 0.5%
41,650 Efes Breweries International (144A) (G.D.R.)* $ 1,249,084
------------
The accompanying notes are an integral part of these financial statements. 19
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 5/31/05 (unaudited) (continued)
- --------------------------------------------------------------------------------
Shares Value
Distillers & Vintners - 0.5%
367,700 Grupo Modelo, SA de CV* $ 1,116,241
------------
Soft Drinks - 1.3%
47,000 Fomento Economico Mexicano, SA de CV $ 2,573,250
985,300 Sermsuk Public Co., Ltd. 494,150
------------
$ 3,067,400
------------
Tobacco - 0.4%
603,000 PT Gudang Garam Public Co., Ltd. $ 816,889
------------
Total Food, Beverage & Tobacco $ 6,249,614
------------
Household & Personal Products - 1.3%
Household Products - 0.6%
261,520 Arcelik AS* $ 1,373,708
------------
Personal Products - 0.7%
47,020 Natura Cosmeticos SA $ 1,569,351
------------
Total Household & Personal Products $ 2,943,059
------------
Pharmaceuticals & Biotechnology - 0.3%
Pharmaceuticals - 0.3%
1,065,400 PT Tempo Scan Pacific $ 782,183
4 Sun Pharmaceutical Industries, Ltd.
(Demat Shares)* 48
------------
$ 782,231
------------
Total Pharmaceuticals & Biotechnology $ 782,231
------------
Banks - 11.3%
Diversified Banks - 10.2%
70,102 Banco Bradesco SA (c) $ 2,241,161
324,400 Bangkok Bank, Ltd. (Foreign Shares) 925,568
1,412,131 Chinatrust Financial Holding Co., Ltd. 1,583,871
971,700 Commerce Asset Holdings Bhd.* 1,190,324
1,596,000 E.Sun Financial Holding Co., Ltd.* 1,293,641
62,900 Hana Bank* 1,598,914
797,600 Kasikornbank 1,166,916
62,000 Kookmin Bank (A.D.R.)*(c) 2,740,400
14,131 Kookmin Bank* 619,057
1,334,600 Metropolitan Bank & Trust Co. 720,337
2,289,000 PT Bank Central Asia Tbk 835,671
20 The accompanying notes are an integral part of these financial statements.
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Shares Value
Diversified Banks (continued)
13,446,785 PT Lippo Bank* $ 1,398,661
749,600 Siam Commercial Bank Plc (Foreign Shares) 876,240
151,486 Standard Bank Group, Ltd. 1,390,527
89,000 State Bank of India 1,364,525
201,210 Turkiye Is Bankasi (Isbank) 1,085,140
68,539 Uniao de Bancos Brasileiros SA (G.D.R.) (144A) (c) 2,460,550
------------
$ 23,491,503
------------
Regional Banks - 1.1%
1,346,000 First Financial Holding* $ 1,093,550
155,000 Grupo Financiero Galicia (A.D.R.)*(c) 1,356,250
------------
$ 2,449,800
------------
Total Banks $ 25,941,303
------------
Diversified Financials - 5.0%
Diversified Financial Services - 5.0%
6,274,000 Bank Mandiri $ 1,092,347
4,655,713 China Development Financial* 1,774,150
859,597 FirstRand, Ltd. 1,735,933
1,117,000 Fubon Group 1,055,495
842,200 MCL Land, Ltd.* 621,589
2,009,100 RHB Capital Bhd. 1,062,438
52,400 Samsung Securities Co., Ltd.* 1,362,877
1,239,900 Sanlam, Ltd.* 2,033,011
6,639,700 SM Prime Holdings 923,328
------------
$ 11,661,168
------------
Total Diversified Financials $ 11,661,168
------------
Insurance - 3.1%
Life & Health Insurance - 1.1%
1,972,000 China Life Insurance Co., Ltd.* $ 1,294,541
778,000 Ping An Insurance Co. of China, Ltd.* 1,217,145
------------
$ 2,511,686
------------
Multi-Line Insurance - 1.5%
465,825 Aksigorta AS $ 1,783,509
22,000 Samsung Fire & Marine Insurance* 1,645,778
------------
$ 3,429,287
------------
The accompanying notes are an integral part of these financial statements. 21
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 5/31/05 (unaudited) (continued)
- --------------------------------------------------------------------------------
Shares Value
Property & Casualty Insurance - 0.5%
62,800 Cathay Financial Holding Co., Ltd., (144A)
(G.D.R.)* $ 1,190,060
------------
Total Insurance $ 7,131,033
------------
Real Estate - 0.5%
Real Estate Management & Development - 0.5%
683,000 Wheelock Properties (Singapore), Ltd. $ 1,118,747
------------
Total Real Estate $ 1,118,747
------------
Software & Services - 0.8%
Application Software - 0.8%
25,068 Infosys Technologies, Ltd. $ 1,285,245
19,800 Satyam Computer Services, Ltd.* 489,258
------------
$ 1,774,503
------------
Total Software & Services $ 1,774,503
------------
Technology Hardware & Equipment - 3.6%
Semiconductors - 2.1%
474,026 Hon Hai Precision Industry $ 2,476,443
1,309,729 Taiwan Semiconductor Manufacturing Co. 2,366,794
------------
$ 4,843,237
------------
Computer Storage & Peripherals - 1.0%
1,275,000 Quanta Computer, Inc.* $ 2,324,737
------------
Electronic Equipment & Instruments - 0.5%
610,000 ACER Sertek, Inc.* $ 1,153,473
------------
Total Technology Hardware & Equipment $ 8,321,447
------------
Semiconductors - 5.7%
20,170 Samsung Electronics $ 9,735,061
148,900 Taiwan Semiconductor Manufacturing Co. (A.D.R.) 1,371,369
2,995,770 United Microelectronics Corp., Ltd. 2,017,846
------------
$ 13,124,276
------------
Total Semiconductors $ 13,124,276
------------
Telecommunication Services - 6.4%
Integrated Telecommunication Services - 2.6%
35,700 Brasil Telecom Participacoes SA $ 1,184,883
243,600 Mahanagar Telephone (Demat Shares) 676,979
22 The accompanying notes are an integral part of these financial statements.
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Shares Value
Integrated Telecommunication Services (continued)
275,260 Mahanagar Telephone Nigam, Ltd.* $ 1,786,437
105,800 Telecom Argentina Stet France Telecom SA (A.D.R.)* 1,291,818
204,300 Telekomunikacja Polska SA 1,132,824
------------
$ 6,072,941
------------
Wireless Telecommunication Services - 3.8%
64,100 Korea Telecom Freetel Co.* $ 1,465,314
39,300 Mobile Telesystems (A.D.R.) (c) 1,379,430
181,000 MTN Group, Ltd.* 1,199,570
58,400 SK Telecom Co., Ltd. 1,221,728
876,000 Taiwan Mobile Co., Ltd. 876,488
346,800 Venfin, Ltd. 1,408,409
36,300 Vimpel Communications (A.D.R.)* 1,344,552
------------
$ 8,895,491
------------
Total Telecommunication Services $ 14,968,432
------------
Utilities - 2.3%
Electric Utilities - 0.8%
66,000 Korea Electric Power Corp.* $ 1,950,097
------------
Gas Utilities - 1.4%
46,500 Korea Gas Corp. $ 1,298,359
3,230,500 PetroChina Co., Ltd.* 2,079,910
------------
$ 3,378,269
------------
Total Utilities $ 5,328,366
------------
TOTAL COMMON STOCKS
(Cost $173,292,358) $217,291,706
------------
WARRANTS - 0.0%
Commercial Services & Supplies - 0.0%
11,697 Bidvest Group, Ltd., Exp. 12/08/06* $ 24,530
------------
TOTAL WARRANTS
(Cost $0) $ 24,530
------------
TEMPORARY CASH INVESTMENTS - 8.7%
Security Lending Collateral - 8.7%
20,134,868 Securities Lending Investment Fund, 2.988% $ 20,134,868
------------
TOTAL TEMPORARY CASH INVESTMENTS
(Cost $20,134,868) $ 20,134,868
------------
The accompanying notes are an integral part of these financial statements. 23
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 5/31/05 (unaudited) (continued)
- --------------------------------------------------------------------------------
Shares Value
TOTAL INVESTMENTS IN SECURITIES - 106.0%
(Cost $199,740,593) (a) (b) $245,105,360
------------
OTHER ASSETS AND LIABILITIES - (6.0)% $(13,842,910)
------------
TOTAL NET ASSETS - 100.0% $231,262,450
============
(A.D.R.) American Depositary Receipt
(G.D.R.) Global Depositary Receipt
* Non-income producing security
144A Security is exempt from registration under Rule 144A of the Securities
Act of 1933. Such securities may be resold normally to qualified
institutional buyers in a transaction exempt from registration. At May
31, 2005, the value of these securities amounted to $7,344,434 or 3.2%
of net assets.
(a) Distributions of investments by country of issue, as a percentage of
equity holdings (excluding temporary cash investments) is as follows:
South Korea 22.1%
Brazil 13.9
Taiwan 12.2
South Africa 8.9
India 8.1
People's Republic of China 4.5
Turkey 4.3
Thailand 3.8
Russia 3.4
Mexico 3.2
Indonesia 3.1
Malaysia 3.1
Peru 1.2
Argentina 1.2
Philippines 1.2
Hong Kong 0.9
Other (Individually less than 1%) 4.9
----
100.0%
======
(b) At May 31, 2005, the net unrealized gain on investments based on cost for
federal income tax purposes of $203,082,841 was as follows:
Aggregate gross unrealized gain for all investments in which there is
an excess of value over tax cost $46,624,851
Aggregate gross unrealized loss for all investments in which there is
an excess of tax cost over value (4,602,333)
-----------
Net unrealized gain $42,022,518
===========
24 The accompanying notes are an integral part of these financial statements.
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(c) At May 31, 2005, the following securities were out on loan:
Shares Security Market Value
108,240 AngloGold Ashanti, Ltd. (A.D.R.) $ 3,716,962
66,597 Banco Bradesco SA 2,129,106
231,413 Centrais Electricas Brasileiras SA (A.D.R.)* 1,606,006
33,535 China Telecom, Ltd. (A.D.R.)+ 1,165,006
82,400 Grupo Financiero Galicia (A.D.R.)* 721,000
60,800 Kookmin Bank (A.D.R.)* 2,687,360
27,140 Lukoil Holdings (A.D.R.)+ 948,543
37,335 Mobile Telesystems (A.D.R.) 1,310,459
44,840 Repsol SA (A.D.R.) 1,123,690
71,250 Surgutneftegaz (A.D.R.)* 2,413,238
88,249 Tele Norte Leste Participacoes (A.D.R.) 1,345,797
3,200 Uniao de Bancos Brasileiros SA (G.D.R.) (144A) 114,880
-----------
Total $19,282,047
===========
+ Pending sales for securities China Telecom, Ltd. and Lukoil Holdings as of
May 31, 2005.
Purchases and sales of securities (excluding temporary cash investments) for
the period ended May 31, 2005 aggregated $103,246,810 and $162,307,636,
respectively.
The accompanying notes are an integral part of these financial statements. 25
Pioneer Emerging Markets Fund
- -----------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES 5/31/05 (unaudited)
- -----------------------------------------------------------------------------
ASSETS:
Investment in securities (including securities loaned of
$19,282,047) (cost $199,740,593) $245,105,360
Cash 345,134
Foreign currencies, at value ($1,468,045) 1,466,964
Receivables -
Investment securities sold 5,521,725
Fund shares sold 294,730
Forward foreign currency settlement contracts, net 37
Dividends, interest and foreign taxes withheld 1,027,923
Due from Pioneer Investment Management, Inc. 51,047
Other 1,439
-------------
Total assets $253,814,359
-------------
LIABILITIES:
Payables -
Investment securities purchased $ 1,190,970
Fund shares repurchased 392,999
Upon return of securities loaned 20,134,868
Due to affiliates 460,574
Accrued expenses 157,873
Reserve for repatriation taxes 214,625
-------------
Total liabilities $ 22,551,909
-------------
NET ASSETS:
Paid-in capital $199,738,115
Undistributed net investment income 766,149
Accumulated net realized loss on investments and foreign
currency transactions (14,385,898)
Net unrealized gain on investments 45,150,142
Net unrealized loss on forward foreign currency contracts
and other assets and liabilities denominated in foreign
currencies (6,058)
-------------
Total net assets $231,262,450
=============
NET ASSET VALUE PER SHARE:
(No par value, unlimited number of shares authorized)
Class A (based on $147,251,699/7,706,123 shares) $ 19.11
=============
Class B (based on $34,643,509/1,968,713 shares) $ 17.60
=============
Class C (based on $35,577,441/2,027,929 shares) $ 17.54
=============
Class R (based on $86,398/4,569 shares) $ 18.91
=============
Class Y (based on $13,703,403/680,343 shares) $ 20.14
=============
MAXIMUM OFFERING PRICE:
Class A ($19.11 [divided by] 94.25%) $ 20.28
=============
26 The accompanying notes are an integral part of these financial statements.
Pioneer Emerging Markets Fund
- -----------------------------------------------------------------------------
STATEMENT OF OPERATIONS (unaudited)
- -----------------------------------------------------------------------------
For the Six Months Ended 5/31/05
INVESTMENT INCOME:
Dividends (net of foreign taxes withheld of $650,134) $ 4,780,608
Interest 47,473
Income from securities loaned, net 22,498
-------------
Total investment income $ 4,850,579
-------------
EXPENSES:
Management fees $ 1,421,816
Transfer agent fees and expenses
Class A 412,884
Class B 91,481
Class C 69,786
Class R 226
Class Y 360
Distribution fees
Class A 191,607
Class B 184,441
Class C 182,857
Class R 177
Administrative reimbursements 24,992
Custodian fees 185,844
Registration fees 62,477
Professional fees 50,032
Printing expense 18,600
Fees and expenses of nonaffiliated trustees 5,062
Miscellaneous 14,773
-------------
Total expenses $ 2,917,415
Less management fees waived and expenses reim-
bursed by Pioneer Investment Management, Inc. (61,589)
Less fees paid indirectly (9,145)
-------------
Net expenses $ 2,846,681
-------------
Net investment income $ 2,003,898
-------------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS:
Net realized gain (loss) on:
Investments (net of foreign capital gain taxes of
$78,530) $ 42,062,366
Forward foreign currency contracts and other assets
and liabilities denominated in foreign currencies (313,771) $ 41,748,595
------------- -------------
Change in net unrealized loss on:
Investments (net of decrease in reserve for
repatriation taxes of $36,862) $ (27,788,428)
Forward foreign currency contracts and other assets
and liabilities denominated in foregin currencies (38,087) $ (27,826,515)
------------- -------------
Net gain on investments and foreign currency
transactions $ 13,922,080
-------------
Net increase in net assets resulting from operations $ 15,925,978
=============
The accompanying notes are an integral part of these financial statements. 27
Pioneer Emerging Markets Fund
- -----------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- -----------------------------------------------------------------------------
For the Six Months Ended 5/31/05 and the Year Ended 11/30/04
Six Months
Ended
5/31/05 Year Ended
(unaudited) 11/30/04
FROM OPERATIONS:
Net investment income $ 2,003,898 $ 1,766,742
Net realized gain on investments and foreign currency
transactions 41,748,595 43,488,541
Change in net unrealized gain (loss) on investments
and foreign currency transactions (27,826,515) 9,253,202
------------- --------------
Net increase (decrease) in net assets resulting
from operations $ 15,925,978 $ 54,508,485
------------- --------------
DISTRIBUTIONS TO SHAREOWNERS:
Net investment income:
Class A ($0.00 and $0.04 per share, respectively) $ - $ (308,722)
Class R ($0.00 and $0.15 per share, respectively) - (147)
Class Y ($0.00 and $0.16 per share, respectively) - (613,683)
------------- --------------
Total distributions to shareowners $ - $ (922,552)
------------- --------------
FROM FUND SHARE TRANSACTIONS:
Net proceeds from sale of shares $ 40,405,187 $ 91,657,497
Reinvestment of distributions - 321,605
Cost of shares repurchased (99,001,058) (117,299,715)
------------- --------------
Net increase (decrease) in net assets resulting
from fund share transactions $ (58,595,871) $ (25,320,613)
------------- --------------
Net increase (decrease) in net assets $ (42,669,893) $ 28,265,320
NET ASSETS:
Beginning of period 273,932,343 245,667,023
------------- --------------
End of period (accumulated undistributed net
investment income (loss) of $766,149 and
($1,237,749), respectively) $ 231,262,450 $ 273,932,343
============= ==============
28 The accompanying notes are an integral part of these financial statements.
Pioneer Emerging Markets Fund
- -----------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS (continued)
- -----------------------------------------------------------------------------
'05 Shares '05 Amounts '04 Shares '04 Amounts
(unaudited) (unaudited)
CLASS A
Shares sold 1,353,062 $ 25,714,561 3,615,669 $ 58,232,544
Reinvestment of distributions - - 17,598 268,196
Less shares repurchased (1,842,708) (34,660,891) (3,864,993) (60,813,131)
---------- ------------- ---------- -------------
Net decrease (489,646) $ (8,946,330) (231,726) $ (2,312,391)
========== ============= ========== ==============
CLASS B
Shares sold 270,915 $ 4,797,770 908,252 $ 13,763,154
Less shares repurchased (502,083) (8,730,502) (1,578,190) (23,101,481)
---------- ------------- ---------- -------------
Net decrease (231,168) $ (3,932,732) (669,938) $ (9,338,327)
========== ============= ========== ==============
CLASS C
Shares sold 295,981 $ 5,195,457 1,115,792 $ 16,655,237
Less shares repurchased (489,273) (8,483,732) (809,502) (11,737,597)
---------- ------------- ---------- -------------
Net increase (decrease) (193,292) $ (3,288,275) 306,290 $ 4,917,640
========== ============= ========== ==============
CLASS R
Shares sold 1,268 $ 23,516 3,802 $ 60,477
Reinvestment of distributions - - 9 139
Less shares repurchased (42) (788) (628) (10,375)
---------- ------------- ---------- -------------
Net increase 1,226 $ 22,728 3,183 $ 50,241
========== ============= ========== ==============
CLASS Y
Shares sold 234,355 $ 4,673,883 172,410 $ 2,946,085
Reinvestment of distributions - - 3,354 53,270
Less shares repurchased (2,453,008) (47,125,145) (1,190,329) (21,637,131)
---------- ------------- ---------- -------------
Net decrease (2,218,653) $ (42,451,262) (1,014,565) $ (18,637,776)
========== ============= ========== ==============
The accompanying notes are an integral part of these financial statements. 29
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Six Months
Ended
5/31/05 Year Ended
CLASS A (unaudited) 11/30/04
Net asset value, beginning of period $ 17.88 $ 14.47
------- --------
Increase (decrease) from investment operations:
Net investment income (loss) $ 0.17 $ 0.10
Net realized and unrealized gain (loss) on investments and
foreign currency transactions 1.06 3.35
------- --------
Net increase (decrease) from investment operations $ 1.23 $ 3.45
Distributions to shareowners:
Net investment income - (0.04)
------- --------
Net increase (decrease) in net asset value $ 1.23 $ 3.41
------- --------
Net asset value, end of period $ 19.11 $ 17.88
======= ========
Total return* 6.88% 23.86%
Ratio of net expenses to average net assets+ 2.16%** 2.17%
Ratio of net investment income (loss) to average net assets+ 1.74%** 0.61%
Portfolio turnover rate 85%** 69%
Net assets, end of period (in thousands) $147,252 $146,503
Ratios with no waiver of management fees and assumption of
expenses by PIM and no reduction for fees paid indirectly:
Net expenses 2.23%** 2.24%
Net investment income (loss) 1.67%** 0.54%
Ratios with waiver of management fees and assumption of
expenses by PIM and reduction for fees paid indirectly:
Net expenses 2.15%** 2.17%
Net investment income (loss) 1.75%** 0.61%
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Year Ended Year Ended Year Ended Year Ended
CLASS A 11/30/03 11/30/02 11/30/01 11/30/00
Net asset value, beginning of period $ 10.11 $ 9.91 $ 10.82 $ 13.80
-------- ------- ------- ---------
Increase (decrease) from investment operations:
Net investment income (loss) $ 0.07 $ (0.01) $ 0.00(a) $ (0.17)
Net realized and unrealized gain (loss) on investments and
foreign currency transactions 4.29 0.21 (0.91) (2.81)
-------- ------- ------- ---------
Net increase (decrease) from investment operations $ 4.36 $ 0.20 $ (0.91) $ (2.98)
Distributions to shareowners:
Net investment income - - - -
-------- ------- ------- ---------
Net increase (decrease) in net asset value $ 4.36 $ 0.20 $ (0.91) $ (2.98)
-------- ------- ------- ---------
Net asset value, end of period $ 14.47 $ 10.11 $ 9.91 $ 10.82
======== ======= ======= ==========
Total return* 43.13% 2.02% (8.41)% (21.59)%
Ratio of net expenses to average net assets+ 2.65% 2.58% 2.76% 2.19%
Ratio of net investment income (loss) to average net assets+ 0.51% (0.09)% (0.04)% (1.13)%
Portfolio turnover rate 88% 101% 177% 139%
Net assets, end of period (in thousands) $121,974 $94,999 $82,739 $ 88,175
Ratios with no waiver of management fees and assumption of
expenses by PIM and no reduction for fees paid indirectly:
Net expenses 2.65% 2.58% 2.76% 2.19%
Net investment income (loss) 0.51% (0.09)% (0.04)% (1.13)%
Ratios with waiver of management fees and assumption of
expenses by PIM and reduction for fees paid indirectly:
Net expenses 2.64% 2.57% 2.74% 2.16%
Net investment income (loss) 0.52% (0.08)% (0.02)% (1.10)%
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized
+ Ratios with no reduction for fees paid indirectly.
(a)Amount rounds to less than one cent per share.
30 The accompanying notes are an integral part of these financial statements.
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Six Months
Ended
5/31/05 Year Ended
CLASS B (unaudited) 11/30/04
Net asset value, beginning of period $ 16.52 $ 13.46
------- -------
Increase (decrease) from investment operations:
Net investment income (loss) $ 0.09 $ (0.01)
Net realized and unrealized gain (loss) on investments and
foreign currency transactions 0.99 3.07
------- -------
Net increase (decrease) from investment operations $ 1.08 $ 3.06
------- -------
Net increase (decrease) in net asset value $ 1.08 $ 3.06
------- -------
Net asset value, end of period $ 17.60 $ 16.52
======= ========
Total return* 6.54% 22.73%
Ratio of net expenses to average net assets+ 2.91%** 2.89%
Ratio of net investment income (loss) to average net assets+ 1.01%** (0.10)%
Portfolio turnover rate 85%** 69%
Net assets, end of period (in thousands) $34,644 $36,352
Ratios with no waiver of management fees and assumption of
expenses by PIM and no reduction for fees paid indirectly:
Net expenses 2.94%** 2.95%
Net investment income (loss) 0.99%** (0.16)%
Ratios with waiver of management fees and assumption of
expenses by PIM and reduction for fees paid indirectly:
Net expenses 2.91%** 2.89%
Net investment income (loss) 1.01%** (0.10)%
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Year Ended Year Ended Year Ended Year Ended
CLASS B 11/30/03 11/30/02 11/30/01 11/30/00
Net asset value, beginning of period $ 9.47 $ 9.34 $ 10.28 $ 13.23
------- ------- ------- ---------
Increase (decrease) from investment operations:
Net investment income (loss) $ (0.08) $ (0.58) $ (0.10) $ (0.34)
Net realized and unrealized gain (loss) on investments and
foreign currency transactions 4.07 0.71 (0.84) (2.61)
------- ------- ------- ---------
Net increase (decrease) from investment operations $ 3.99 $ 0.13 $ (0.94) $ (2.95)
------- ------- ------- ---------
Net increase (decrease) in net asset value $ 3.99 $ 0.13 $ (0.94) $ (2.95)
------- ------- ------- ---------
Net asset value, end of period $ 13.46 $ 9.47 $ 9.34 $ 10.28
======= ======= ======= ==========
Total return* 42.13% 1.39% (9.14)% (22.30)%
Ratio of net expenses to average net assets+ 3.37% 3.21% 3.59% 3.05%
Ratio of net investment income (loss) to average net assets+ (0.26)% (0.66)% (0.87)% (1.97)%
Portfolio turnover rate 88% 101% 177% 139%
Net assets, end of period (in thousands) $38,615 $29,674 $35,651 $ 40,763
Ratios with no waiver of management fees and assumption of
expenses by PIM and no reduction for fees paid indirectly:
Net expenses 3.37% 3.21% 3.59% 3.05%
Net investment income (loss) (0.26)% (0.66)% (0.87)% (1.97)%
Ratios with waiver of management fees and assumption of
expenses by PIM and reduction for fees paid indirectly:
Net expenses 3.37% 3.21% 3.58% 3.03%
Net investment income (loss) (0.26)% (0.66)% (0.86)% (1.95)%
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized
+ Ratios with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements. 31
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Six Months
Ended
5/31/05 Year Ended
CLASS C (unaudited) 11/30/04
Net asset value, beginning of period $ 16.47 $ 13.39
------- -------
Increase (decrease) from investment operations:
Net investment income (loss) $ 0.09 $ 0.00(a)
Net realized and unrealized gain (loss) on investments and
foreign currency transactions 0.98 3.08
------- -------
Net increase (decrease) from investment operations $ 1.07 $ 3.08
------- -------
Net increase (decrease) in net asset value $ 1.07 $ 3.08
------- -------
Net asset value, end of period $ 17.54 $ 16.47
======= =======
Total return* 6.50% 23.00%
Ratio of net expenses to average net assets+ 2.80%** 2.78%
Ratio of net investment income (loss) to average net assets+ 1.12%** (0.01)%
Portfolio turnover rate 85%** 69%
Net assets, end of period (in thousands) $35,577 $36,579
Ratios with no waiver of management fees by PIM and no
reduction for fees paid indirectly:
Net expenses 2.82%** 2.86%
Net investment income (loss) 1.10%** (0.08)%
Ratios with waiver of management fees by PIM and reduction for
fees paid indirectly:
Net expenses 2.80%** 2.78%
Net investment income (loss) 1.12%** (0.01)%
Pioneer Emerging Markets Fund
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- -------------------------------------------------------------------------------
Year Ended Year Ended Year Ended Year Ended
CLASS C 11/30/03 11/30/02 11/30/01 11/30/00
Net asset value, beginning of period $ 9.42 $ 9.29 $ 10.23 $ 13.12
------- ------- ------- ---------
Increase (decrease) from investment operations:
Net investment income (loss) $ (0.14) $ (0.18) $ (0.01) $ (0.14)
Net realized and unrealized gain (loss) on investments and
foreign currency transactions 4.11 0.31 (0.93) (2.75)
------- ------- ------- ---------
Net increase (decrease) from investment operations $ 3.97 $ 0.13 $ (0.94) $ (2.89)
------- ------- ------- ---------
Net increase (decrease) in net asset value $ 3.97 $ 0.13 $ (0.94) $ (2.89)
------- ------- ------- ---------
Net asset value, end of period $ 13.39 $ 9.42 $ 9.29 $ 10.23
======= ======= ======= ==========
Total return* 42.14% 1.40% (9.19)% (22.03)%
Ratio of net expenses to average net assets+ 3.32% 3.16% 3.57% 2.85%
Ratio of net investment income (loss) to average net assets+ (0.18)% (0.63)% (0.81)% (1.81)%
Portfolio turnover rate 88% 101% 177% 139%
Net assets, end of period (in thousands) $25,632 $29,239 $15,864 $ 12,861
Ratios with no waiver of management fees by PIM and no
reduction for fees paid indirectly:
Net expenses 3.32% 3.16% 3.57% 2.85%
Net investment income (loss) (0.18)% (0.63)% (0.81)% (1.81)%
Ratios with waiver of management fees by PIM and reduction for
fees paid indirectly:
Net expenses 3.32% 3.15% 3.55% 2.82%
Net investment income (loss) (0.18)% (0.62)% (0.79)% (1.78)%
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized
+ Ratios with no reduction for fees paid indirectly.
(a) Amount rounds to less than one cent per share.
32 The accompanying notes are an integral part of these financial statements.
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------
Six Months
Ended 4/1/03(a)
5/31/05 Year Ended to
CLASS R (unaudited) 11/30/04 11/30/03
Net asset value, beginning of period $ 17.72 $ 14.51 $ 9.57
------- ------- -------
Increase from investment operations:
Net investment income $ 0.15 $ 0.11 $ 0.02
Net realized and unrealized gain on investments
and foreign currency transactions 1.04 3.25 4.93
------- ------- -------
Net increase from investment operations $ 1.19 $ 3.36 $ 4.95
Distributions to shareowners:
Net investment income - (0.15) (0.01)
------- ------- -------
Net increase in net asset value $ 1.19 $ 3.21 $ 4.94
------- ------- -------
Net asset value, end of period $ 18.91 $ 17.72 $ 14.51
======= ======= ========
Total return* 6.72% 23.35% 51.74%
Ratio of net expenses to average net assets+ 2.47%** 2.61% 2.13%**
Ratio of net investment income to average net
assets+ 1.68%** 0.13% 0.56%**
Portfolio turnover rate 85%** 69% 88%
Net assets, end of period (in thousands) $ 86 $ 59 $ 2
Ratios with no waiver of management fees by PIM
and no reduction for fees paid indirectly:
Net expenses 2.59%** 2.70% 2.13%**
Net investment income 1.56%** 0.04% 0.56%**
Ratios with waiver of management fees by PIM and
reduction for fees paid indirectly:
Net expenses 2.47%** 2.61% 2.13%**
Net investment income 1.68%** 0.13% 0.56%**
(a) Class R Shares were first publicly offered on April 1, 2003.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized
+ Ratios with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements. 33
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Six Months
Ended
5/31/05 Year Ended
CLASS Y (unaudited) 11/30/04
Net asset value, beginning of period $ 18.78 $ 15.19
------- -------
Increase (decrease) from investment operations:
Net investment income (loss) $ 0.12 $ 0.28
Net realized and unrealized gain (loss) on investments and
foreign currency transactions 1.24 3.47
------- -------
Net increase (decrease) from investment operations $ 1.36 $ 3.75
Distributions to shareowners:
Net investment income - (0.16)
------- -------
Net increase (decrease) in net asset value $ 1.36 $ 3.59
------- -------
Net asset value, end of period $ 20.14 $ 18.78
======= =======
Total return* 7.24% 24.86%
Ratio of net expenses to average net assets+ 1.40%** 1.30%
Ratio of net investment income (loss) to average net assets+ 2.58%** 1.46%
Portfolio turnover rate 85%** 69%
Net assets, end of period (in thousands) $13,703 $54,440
Ratios with no waiver of management fees by PIM and no
reduction for fees paid indirectly:
Net expenses 1.40%** 1.37%
Net investment income (loss) 2.58%** 1.39%
Ratios with waiver of management fees by PIM and reduction for
fees paid indirectly:
Net expenses 1.40%** 1.30%
Net investment income (loss) 2.58%** 1.46%
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Year Ended Year Ended Year Ended Year Ended
CLASS Y 11/30/03 11/30/02 11/30/01 11/30/00
Net asset value, beginning of period $ 10.51 $ 10.20 $ 11.03 $ 13.99
------- ------- ------- ---------
Increase (decrease) from investment operations:
Net investment income (loss) $ 0.19 $ 0.13 $ 0.10 $ (0.10)
Net realized and unrealized gain (loss) on investments and
foreign currency transactions 4.50 0.18 (0.93) (2.86)
------- ------- ------- ---------
Net increase (decrease) from investment operations $ 4.69 $ 0.31 $ (0.83) $ (2.96)
Distributions to shareowners:
Net investment income (0.01) - - -
------- ------- ------- ---------
Net increase (decrease) in net asset value $ 4.68 $ 0.31 $ (0.83) $ (2.96)
------- ------- ------- ---------
Net asset value, end of period $ 15.19 $ 10.51 $ 10.20 $ 11.03
======= ======= ======= =========
Total return* 44.63% 3.04% (7.52)% (21.16)%
Ratio of net expenses to average net assets+ 1.60% 1.58% 1.80% 1.62%
Ratio of net investment income (loss) to average net assets+ 1.52% 0.93% 0.96% (0.62)%
Portfolio turnover rate 88% 101% 177% 139%
Net assets, end of period (in thousands) $59,444 $41,683 $43,861 $ 47,378
Ratios with no waiver of management fees by PIM and no
reduction for fees paid indirectly:
Net expenses 1.60% 1.58% 1.80% 1.62%
Net investment income (loss) 1.52% 0.93% 0.96% (0.62)%
Ratios with waiver of management fees by PIM and reduction for
fees paid indirectly:
Net expenses 1.60% 1.58% 1.80% 1.60%
Net investment income (loss) 1.52% 0.93% 0.96% (0.60)%
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized
+ Ratios with no reduction for fees paid indirectly.
34 The accompanying notes are an integral part of these financial statements.
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 5/31/05 (unaudited)
- --------------------------------------------------------------------------------
1. Organization and Significant Accounting Policies
Pioneer Emerging Markets Fund (the Fund) is a Delaware statutory trust
registered under the Investment Company Act of 1940 as a diversified, open-end
management investment company. The investment objective of the Fund is to seek
long-term growth of capital.
The Fund offers five classes of shares - Class A, Class B, Class C, Class R,
and Class Y shares. Each class of shares represents an interest in the same
portfolio of investments of the Fund and has equal rights to voting,
redemptions, dividends and liquidation, except that the level of transfer agent
and distribution fees may differ among classes. Class A, Class B, Class C and
Class R shareowners have exclusive voting rights with respect to the
distribution plan for each class. There is no distribution plan for Class Y
shares.
The Fund's financial statements have been prepared in conformity with U.S.
generally accepted accounting principles that require the management of the
Fund to, among other things, make estimates and assumptions that affect the
reported amounts of assets and liabilities, the disclosure of contingent assets
and liabilities at the date of the financial statements, and the reported
amounts of income, expenses and gains and losses on investments during the
reporting year. Actual results could differ from those estimates. The following
is a summary of significant accounting policies followed by the Fund in the
preparation of its financial statements, which are consistent with those
policies generally accepted in the investment company industry:
A. Security Valuation
Security transactions are recorded as of trade date. The net asset value
of the Fund is computed once daily, on each day the New York Stock
Exchange (NYSE) is open, as of the close of regular trading on the NYSE.
In computing the net asset value, securities are valued using the last
sale price on the principal exchange where they are traded. Securities
that have not traded on the date of valuation, or securities for which
sale prices are not generally reported, are valued using the mean between
the last bid and asked prices. Securities for which market quotations are
not readily available are valued at their fair values as determined by, or
under the direction of, the Board of Trustees. The Fund invests primarily
in securities of non-U.S. issuers. The principal exchanges and markets for
such securities have closing times prior to the close of the
35
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 5/31/05 (unaudited) (continued)
- --------------------------------------------------------------------------------
NYSE. However, the value of these securities may be influenced by changes
in global markets occurring after the closing times of the local exchanges
and markets up to the time the Fund determines its net asset value.
Consequently, the Board of Trustees of the Fund has determined that the
use of daily fair valuations as provided by a pricing service is
appropriate for the Fund. The Fund may also take into consideration other
significant events in determining the fair value of these securities.
Thus, the Fund's securities valuations may differ from prices reported by
the various local exchanges and markets. Temporary cash investments are
valued at amortized cost.
Dividend income is recorded on the ex-dividend date, except that certain
dividends from foreign securities where the ex-dividend date may have
passed are recorded as soon as the Fund becomes aware of the ex-dividend
data in exercise of reasonable diligence. Dividend and interest income are
recorded on the accrual basis net of unrecoverable foreign taxes withheld
at the applicable country rates.
Gains and losses on sales of investments are calculated on the identified
cost method for both financial reporting and federal income tax purposes.
The Fund's investments in emerging markets or countries with limited or
developing markets may subject the Fund to a greater degree of risk than
in a developed market. Risks associated with these developing markets
include political, social or economic factors and may affect the price of
the Fund's investments and income generated by these investments, as well
as the Fund's ability to repatriate such amounts.
B. Foreign Currency Translation
The books and records of the Fund are maintained in U.S. dollars. Amounts
denominated in foreign currencies are translated into U.S. dollars using
current exchange rates.
Net realized gains and losses on foreign currency transactions represent,
among other things, the net realized gains and losses on foreign currency
contracts, disposition of foreign currencies and the difference between
the amount of income accrued and the U.S. dollars actually received.
Further, the effects of changes in foreign currency exchange rates on
investments are not segregated
36
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
in the statement of operations from the effects of changes in market price
of those securities but are included with the net realized and unrealized
gain or loss on investments.
C. Forward Foreign Currency Contracts
The Fund enters into forward foreign currency contracts (contracts) for
the purchase or sale of a specific foreign currency at a fixed price on a
future date as a hedge or cross-hedge against either specific investment
transactions (settlement hedges) or portfolio positions (portfolio
hedges). All contracts are marked to market daily at the applicable
exchange rates, and any resulting unrealized gains or losses are recorded
in the Fund's financial statements. The Fund records realized gains and
losses at the time a portfolio hedge is offset by entry into a closing
transaction or extinguished by delivery of the currency. Risks may arise
upon entering into these contracts from the potential inability of
counterparties to meet the terms of the contract and from unanticipated
movements in the value of foreign currencies relative to the U.S. dollar
(see Note 6).
D. Futures Contracts
The Fund may enter into futures transactions to hedge against changes in
interest rates, securities prices, and currency rates or to seek to
increase total return. Upon entering into a futures contract, the Fund is
required to deposit with a broker an amount of cash or securities equal to
the minimum "initial margin" requirements of the associated futures
exchange. Subsequent payments for futures contracts ("variation margin")
are paid or received by the Fund, depending on the daily fluctuation in
the value of the contracts, and are recorded by the Fund as unrealized
gains or losses. When the contract is closed, the Fund realizes a gain or
loss equal to the difference between the opening and closing values of the
contract. The use of futures contracts involves, to varying degrees,
elements of market risks which may exceed the amounts recognized by the
Fund. Changes in value of the contracts may not directly correlate to the
changes in value of the underlying securities. These risks may decrease
the effectiveness of the Fund's hedging strategies and potentially result
in a loss. At May 31, 2005, the Fund had no open futures contracts.
37
Pioneer Emerging Markets Fund
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NOTES TO FINANCIAL STATEMENTS 5/31/05 (unaudited) (continued)
- --------------------------------------------------------------------------------
E. Federal Income Taxes
It is the Fund's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income and net realized capital gains, if
any, to its shareowners. Therefore, no federal income tax provision is
required.
In addition to the requirements of the Internal Revenue Code, the Fund may
also be required to pay local taxes on the recognition of capital gains
and/or the repatriation of foreign currencies in certain countries. During
the six months ended May 31, 2005, the Fund paid $78,530 in such taxes.
In determining the daily net asset value, the Fund estimates the reserve
for such taxes, if any, associated with investments in certain countries.
The estimated reserve for the capital gains is based on the net unrealized
appreciation on certain portfolio securities, the holding period of such
securities and the related tax rates, tax loss carryforward (if
applicable) and other such factors. As of May 31, 2005, the Fund had
$214,625 in reserve related to capital gains. The estimated reserve for
the repatriation of foreign currencies is based on principal balances
and/or unrealized appreciation of applicable securities, the holding
period of such investments and the related tax rates and other such
factors. As of May 31, 2005, the Fund had no reserve related to taxes on
the repatriation of foreign currencies.
The amounts and characterizations of distributions to shareowners for
financial reporting purposes are determined in accordance with federal
income tax rules. Therefore, the sources of the Fund's distributions may
be shown in the accompanying financial statements as either from or in
excess of net investment income or net realized gain on investment
transactions, or from paid-in capital, depending on the type of book/tax
differences that may exist.
At November 30, 2004, the Fund had a net capital loss carryforward of
$54,036,311, of which $1,968,607 will expire in 2005, $6,469,549 will
expire in 2008, $34,401,642 will expire in 2009 and $11,196,513 will
expire in 2010 if not utilized.
38
Pioneer Emerging Markets Fund
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- --------------------------------------------------------------------------------
The tax character of distributions paid during the year ended November 30,
2004 was as follows:
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
2004
- -----------------------------------------------------------------------------
Distributions paid from:
Ordinary income $922,522
Long-term capital gain -
--------
Total $922,522
========
- -----------------------------------------------------------------------------
The following shows the components of distributable earnings on a
federal income tax basis at November 30, 2004:
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
2004
- -----------------------------------------------------------------------------
Undistributed ordinary income $ -
Capital loss carryforward (54,036,311)
Unrealized appreciation 69,634,668
-----------
Total $15,598,357
===========
- -----------------------------------------------------------------------------
The difference between book basis and tax-basis unrealized appreciation is
attributable to the tax deferral of losses on wash sales and the tax basis
adjustments on Passive Foreign Investment Company (PFIC) holdings and the
mark to market of forward currency contracts.
F. Fund Shares
The Fund records sales and repurchases of its shares as of trade date.
Pioneer Funds Distributor, Inc. (PFD), the principal underwriter for the
Fund and a wholly owned indirect subsidiary of UniCredito Italiano
S.p.A.(UniCredito Italiano), earned $17,157 in underwriting commissions on
the sale of Class A shares during the six months ended May 31, 2005.
G. Class Allocations
Distribution fees are calculated based on the average daily net asset
value attributable to Class A, Class B, Class C and Class R shares of the
Fund, respectively (see Note 4). Class Y shares are not subject to a
distribution plan. Shareowners of each class share all expenses and fees
paid to the transfer agent, Pioneer Investment Management Shareholder
Services, Inc. (PIMSS), for its
39
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 5/31/05 (continued)
- --------------------------------------------------------------------------------
services, which are allocated based on the number of accounts in each
class and the ratable allocation of related out-of-pocket expenses (see
Note 3). Income, common expenses and realized and unrealized gains and
losses are calculated at the Fund level and allocated daily to each class
of shares based on the respective percentage of adjusted net assets at the
beginning of the day.
Distributions to shareowners are recorded as of the ex-dividend date.
Distributions paid by the Fund with respect to each class of shares are
calculated in the same manner, at the same time, and in the same amount,
except that Class A, Class B, Class C, Class R and Class Y shares can bear
different transfer agent and distribution fees.
H. Securities Lending
The Fund lends securities in its Portfolio to certain brokers-dealers or
other institutional investors, with the Fund's custodian acting as the
lending agent. When entering into a loan, the Fund receives collateral,
which is maintained by the custodian and earns income in the form of
negotiated lenders' fees. The Fund also continues to receive interest or
payments in lieu of dividends on the securities loaned. Gain or loss on
the value of the loaned securities that may occur during the term of the
loan will be for the account of the Fund. The loans are secured by
collateral of at least 102%, at all times, of the fair value of the
securities loaned. The amount of the collateral will be adjusted daily to
reflect any price fluctuation in the value of the loaned securities. The
Fund has the right under the lending agreements to recover the securities
on loan from the borrower on demand. The Fund invests cash collateral in
the Securities Lending Investment Fund, which is managed by Brown Brothers
Harriman & Co., the Fund's custodian.
I. Repurchase Agreements
With respect to repurchase agreements entered into by the Fund, the value
of the underlying securities (collateral), including accrued interest
received from counterparties, is required to be at least equal to or in
excess of the value of the repurchase agreements is held in safekeeping in
the customer-only account of the Fund's custodian, or subcustodians. The
Fund's investment adviser, Pioneer Investment Management, Inc. (PIM), is
responsible for determining
40
Pioneer Emerging Markets Fund
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that the value of the collateral remains at least equal to the repurchase
price.
2. Management Agreement
PIM, a wholly owned indirect subsidiary of UniCredito Italiano, manages the
Fund's Portfolio. Effective December 31, 2003, management fees are calculated
daily at an annual rate of 1.15% of the Fund's average daily net assets. Prior
to December 31, 2003, the management fees were calculated daily at the annual
rate of 1.25% of the Fund's average daily net assets.
PIM has agreed not to impose all or a portion of its management fee and, if
necessary, to limit other ordinary operating expense to the extent required to
reduce Class A expenses to 2.15% of the average daily net assets attributable
to Class A shares. The portion of the Fund expenses attributable to classes of
shares other than Class A will be reduced only to the extent such expenses are
reduced for Class A shares.
Effective April 1, 2005, PIM has agreed to limit ordinary operating expenses to
the extent required to reduce fund expenses to 2.15%, 3.05%, 3.05% and 2.40% of
the average daily net assets attributable to Class A, Class B, Class C and
Class R shares, respectively. Class Y shares do not have an expense limitation.
These expense limitations are in effect through April 1, 2008 for Class A
shares and through April 1, 2006 for Class B, Class C and Class R shares.
Pioneer expects to continue its limitation of expenses unless the expense limit
agreement with the fund is terminated pursuant to the terms of the expense
limit agreement. However, there can be no assurance that Pioneer will extend
the expense limitation beyond April 1, 2008 for Class A shares and April 1,
2006 for Class B, Class C and Class R shares. The fund may terminate the
expense limit agreement at any time; provided, however, that the Board of
Trustees would not take such action unless it determined termination of the
agreement to be in the best interests of the fund and its shareholders.
In addition, under the management and administration agreements, certain other
services and costs, including accounting, regulatory reporting and insurance
premiums, are paid by the Fund. At May 31, 2005, $299,589, was payable to PIM
related to management fees, administrative costs and certain other services,
and is included in due to affiliates.
41
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 5/31/05 (unaudited) (continued)
- --------------------------------------------------------------------------------
3. Transfer Agent
PIMSS, a wholly owned indirect subsidiary of UniCredito Italiano, provides
substantially all transfer agent and shareowner services to the Fund at
negotiated rates. Included in due to affiliates is $63,749 in transfer agent
fees payable to PIMSS at May 31, 2005.
4. Distribution and Service Plans
The Fund adopted a Plan of Distribution with respect to Class A, Class B, Class
C and Class R shares (Class A Plan, Class B Plan, Class C Plan and Class R
Plan) in accordance with Rule 12b-1 of the Investment Company Act of 1940.
Pursuant to the Class A Plan, the Fund pays PFD a service fee of up to 0.25% of
the Fund's average daily net assets attributable to Class A shares in
reimbursement of its actual expenditures to finance activities primarily
intended to result in the sale of Class A shares. Pursuant to the Class B Plan
and the Class C Plan, the Fund pays PFD 1.00% of the average daily net assets
attributable to each class of shares. The fee consists of a 0.25% service fee
and a 0.75% distribution fee paid as compensation for personal services and/or
account maintenance services or distribution services with regard to Class B
and Class C shares. Pursuant to the Class R Plan, the Fund pays PFD 0.50% of
the average daily net assets attributable to Class R shares for distribution
services. Included in due to affiliates is $97,236 in distribution fees payable
to PFD at May 31, 2005. The Fund also has adopted a separate service plan for
Class R shares (Service Plan). The Service Plan authorizes the Fund to pay
securities dealers, plan administrators or other service organizations that
agree to provide certain services to retirement plans or plan participants
holdings shares of the Fund a service fee of up to 0.25% of the Fund's average
daily net assets attributable to Class R shares help by such plans.
In addition, redemptions of each class of shares (except Class Y shares) may be
subject to a contingent deferred sales charge (CDSC). Effective February 1,
2004 a CDSC of 1.00% may be imposed on redemptions of certain net asset value
purchases of Class A shares within 18 months of purchase (12 months for shares
purchased prior to February 1, 2004). Class B shares subscribed on or after
December 1, 2004 that are redeemed within five years of purchase are subject to
a CDSC at declining rates beginning at 4.0%, based on the lower of cost or
market value of shares being redeemed. Shares purchases prior to December 1,
2004, remain subject to the CDSC in
42
Pioneer Emerging Markets Fund
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- --------------------------------------------------------------------------------
effect at the time those shares were purchased. Redemptions of Class C shares
within one year of purchase are subject to a CDSC of 1.00%. Redemptions of
Class R shares within 18 months of purchase were subject to a CDSC of 1.00%.
Effective July 1, 2004, the CDSC on Class R shares was eliminated. Proceeds
from the CDSCs are paid to PFD. For the six months ended May 31, 2005, CDSCs in
the amount of $41,156 were paid to PFD.
The Fund charges a 2.0% redemption fee on Class A, Class B, Class C, Class R
and Class Y shares sold within 30 days of purchase. For Class A, Class R and
Class Y shares this fee became effective November 1, 2003, while for Class B
and Class C shares, this fee became effective July 1, 2004. The fee does not
apply to certain types of transactions as described in the Fund's prospectus.
For the six months ended May 31, 2005, the Fund collected $17,648 in redemption
fees, which are included in the Fund's capital account.
5. Directed Brokerage And Expense Offset Arrangements
The Fund has entered into directed brokerage arrangements with brokers with
whom PIM places trades on behalf of the Fund where they provide services to the
Fund in addition to trade execution. These services included payments of
certain expenses on behalf of the Fund. For the six months ended May 31, 2005,
the Fund's expenses were not reduced under these arrangements. In addition, the
Fund has entered into certain expense offset arrangements with PIMSS resulting
in a reduction in the Fund's total expenses, due to interest earned on cash
held by PIMSS. For the six months ended May 31, 2005, the Fund's expenses were
reduced by $9,145 under such arrangements.
6. Forward Foreign Currency Contracts
At May 31, 2005, the Fund had entered into various contracts that obligate the
Fund to deliver currencies at specified future dates. At the maturity of a
contract, the Fund must make delivery of the foreign currency. Alternatively,
prior to the settlement date of a portfolio hedge, the Fund may close out such
contracts by entering into an offsetting hedge contract. At May 31, 2005, the
Fund had no outstanding portfolio hedges. The Fund's gross forward currency
settlement contracts receivable and payable were $325,603, and $325,566,
respectively, resulting in a net receivable of $37.
43
Pioneer Emerging Markets Fund
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NOTES TO FINANCIAL STATEMENTS 5/31/05 (unaudited) (continued)
- --------------------------------------------------------------------------------
7. Line of Credit Facility
The Fund, along with certain other funds in the Pioneer Family of Funds (the
Funds), participates in a $50 million committed, unsecured revolving line of
credit facility. Borrowings are used solely for temporary or emergency
purposes. The Fund may borrow up to the lesser of $50 million or the limits set
by its prospectus for borrowings. Interest on collective borrowings is payable
at the Federal Funds Rate plus 1/2% on an annualized basis. The Funds pay an
annual commitment fee for this facility. The commitment fee is allocated among
such Funds based on their respective borrowing limits. For the six months ended
May 31, 2005, there were no borrowings under such agreement.
44
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
FACTORS CONSIDERED BY THE INDEPENDENT TRUSTEES IN
APPROVING THE MANAGEMENT CONTRACT
- --------------------------------------------------------------------------------
The Investment Company Act of 1940 requires that both the Board of Trustees and
a majority of the Independent Trustees (collectively "the Trustees") voting
separately annually approve the Fund's management contract (the "Management
Contract"). The Trustees have determined that the terms of the Management
Contract are fair and reasonable and that renewal of the contract will enable
the Fund to receive quality investment advisory services at a cost deemed
reasonable and is in the best interests of the Fund and its shareowners. In
making such determinations, the Independent Trustees relied upon the assistance
of counsel to the Independent Trustees and counsel to the Fund.
Throughout the year, the Independent Trustees regularly met in executive
session separately from the Interested Trustees of the Fund and any officer of
Pioneer Investment Management, Inc., the Fund's adviser (the "Investment
Adviser"), or its affiliates. While the Trustees, including the Independent
Trustees, act on all major matters relating to the Fund, a significant portion
of the activities of the Board of Trustees (including certain of those
described herein) is conducted through committees, the members of which are
comprised exclusively of Independent Trustees. Such committee meetings are
attended by officers of the Fund or the Investment Adviser to the extent
requested by the members of the committee.
In evaluating the Management Contract, the Trustees conducted a review that was
specifically focused upon the renewal of the Management Contract, and relied
upon their knowledge, resulting from their meetings throughout the year, of the
Investment Adviser, its services and the Fund. Both in meetings specifically
dedicated to renewal of the Management Contract and at other meetings during
the course of the year, the Trustees, including the Independent Trustees,
received materials relating to the Investment Adviser's investment and
management services under the Management Contract. These materials included (i)
information on the investment performance of the Fund, a peer group of funds
and an index, in each case selected by the Independent Trustees for this
purpose, (ii) sales and redemption data in respect of the Fund, (iii) the
general investment outlook in the markets in which the Fund invests, (iv)
arrangements in respect of the distribution of the Fund's shares, (v) the
procedures employed to determine the value of each of the Fund's assets, (vi)
the Investment Adviser's management of the relationships with the Fund's
unaffiliated service providers, (vii) the record of compliance with the Fund's
investment policies and restrictions and with the Fund's Code of Ethics and
45
Pioneer Emerging Markets Fund
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FACTORS CONSIDERED BY THE INDEPENDENT TRUSTEES IN
APPROVING THE MANAGEMENT CONTRACT (continued)
- --------------------------------------------------------------------------------
the structure and responsibilities of the Investment Adviser's compliance
department, (viii) the nature, cost and character of non-investment management
services provided by the Investment Adviser and its affiliates and (ix) the
disclosures included in the Fund's prospectuses and reports to shareowners.
Specifically in connection with the Independent Trustees' review of the
Management Contract, the Independent Trustees requested and the Investment
Adviser provided additional information in order to evaluate the quality of the
Investment Adviser's services and the reasonableness of the fee under the
Management Contract. Among other items, this information included data or
analyses of (1) investment performance for one, three, and five-year periods
for the Fund and a peer group selected by the Independent Trustees for this
purpose, (2) management and other fees incurred by a peer group of funds
selected by the Independent Trustees for this purpose, (3) the advisory fees of
comparable portfolios of other clients of the Investment Adviser, (4) expense
ratios for the Fund and a peer group of funds selected by the Independent
Trustees for this purpose, (5) the overall organization of the Investment
Adviser, (6) the Investment Adviser's financial results and condition,
including its and certain of its affiliates profitability from services
performed for the Fund, (7) transfer agency fees and administrative
reimbursements paid to the Investment Adviser or affiliates, (8) investment
management staffing, and (9) operating expenses paid to third parties. The
Trustees also reviewed information regarding the potential for each of the Fund
and the Investment Adviser to benefit from further economies of scale in the
management of the Fund in light of reasonable growth expectations for the Fund,
the break points in the Fund's management fee and of a peer group of funds
selected by the Independent Trustees for this purpose and certain of the Fund's
expenses that are not incurred as fees based on a percentage of net assets.
The following summarizes matters considered by the Trustees in connection with
their renewal of the Fund's Management Contract. The Trustees did not identify
any single factor as all-important or controlling, and the summary does not
detail all the matters that were considered.
A. Ancillary Benefits to Shareowners. The Trustees considered the benefits to
shareowners of investing in a Fund that is part of a large number of
investment companies offering a variety of
46
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
investment disciplines and providing for a large variety of Fund and
shareowner services.
B. Compliance and Investment Performance. The Trustees determined that the
Investment Adviser had policies and systems reasonably designed to achieve
compliance with the Fund's investment objective and regulatory
requirements. The Trustees also reviewed the Fund's investment performance
based upon total return, as well as the Fund's performance compared to
both the performance of a peer group and the results of an index, in each
case selected by the Independent Trustees for this purpose. The Fund's
performance based upon total return was in the fourth quintile of the peer
group for the 12 months ended June 30, 2004, the third quintile for the
three years ended June 30, 2004, and the second quintile for the five
years ended June 30, 2004. (In all quintile rankings referred to
throughout this discussion first quintile is most favorable to the Fund's
shareowners. Thus, highest relative performance would be first quintile
and lowest relative expenses also would be first quintile.) The Trustees
concluded that the performance of the Fund supported the continuation of
the Management Contract.
C. The Investment Adviser's Personnel and Methods. The Trustees reviewed the
background of members of the team responsible for the daily management of
the Fund and the Fund's investment objective and discipline. The
Independent Trustees also have had discussions with senior management of
the Investment Adviser responsible for investment operations and the
senior management of the Investment Adviser's equities group. Among other
things, the Trustees considered the number, education and experience of
the Investment Adviser's investment staff and their use of technology and
emphasis on analytics in view of the risk profile of securities in which
the Fund invests. The Trustees concluded that the Investment Adviser had
the quality and depth of personnel and the well-developed methods
essential to performing its duties under the Management Contract.
D. Nature and Quality of Other Services. The Trustees considered the nature,
quality, cost and extent of other services provided to shareowners of the
Fund, including administrative and shareowner services performed by the
Investment Adviser under the Management Contract. The Trustees also
considered the reasonableness
47
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
FACTORS CONSIDERED BY THE INDEPENDENT TRUSTEES IN
APPROVING THE MANAGEMENT CONTRACT (continued)
- --------------------------------------------------------------------------------
of the arrangements for reimbursement of the Investment Adviser's
out-of-pocket costs and expenses, including overhead, for certain
administrative services that the Investment Adviser is not required to
provide under the Management Contract. The Trustees also considered the
nature and extent of the other services provided by the Investment
Adviser's affiliates under other contracts and its supervision of third
party service providers. Based on these considerations, the Trustees
concluded that the nature, quality, cost and extent of such services are
satisfactory and reliable and serve the shareowners of the Fund well.
E. Management Fee and Expenses. The Trustees considered the Investment
Adviser's fee under the Management Contract relative to the management
fees charged by a peer group of funds selected by the Independent Trustees
for this purpose using data provided by an independent third party. The
Fund's management fee for the 12 months ended June 30, 2004 was in the
third quintile relative to the management fees paid by the other funds in
that peer group for the comparable period. The Trustees determined that
the fee under the Management Contract was reasonable and fair in light of
both the overall nature and quality of services provided by the Investment
Adviser and the fees charged by the funds in the peer group. The Trustees
also considered the Fund's expense ratio (before and after giving effect
to the expense limitation) for the 12 months ended June 30, 2004 and
expense ratios for the comparable period of a peer group of funds selected
by the Independent Trustees for this purpose. The Fund's expense ratio
(after giving effect to the expense limitation) was in the third quintile
of this peer group for the most recent fiscal year. The Trustees concluded
that the Fund's overall expense ratio was comparable to that of most of
the comparably-sized funds.
F. Profitability. The Trustees considered the level of the Investment Adviser's
profits with respect to the management of the Pioneer Funds, including
details with respect to the Fund. This consideration included a review of
the Investment Adviser's methodology in allocating certain of its costs to
the management of each Fund. The Trustees also considered the financial
results realized by the Investment Adviser in connection with the
operation of the Fund. They further considered the profits realized by the
Investment Adviser and its affiliates from non-fund businesses that may
benefit from or be related to the Fund's business. The Trustees
48
Pioneer Emerging Markets Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
considered the Investment Adviser's profit margins in comparison with the
limited available industry data. The Trustees concluded that the
Investment Adviser's profits from management of the Pioneer Funds,
including the financial results derived from the Fund, bear a reasonable
relationship to the services rendered and are fair for the management of
the Fund.
G. Economies of Scale. The Trustees considered the economies of scale with
respect to the management of the Fund, whether the Fund had appropriately
benefited from any economies of scale, and whether there was potential for
realization of any further economies of scale. The Trustees concluded
that, at current and reasonable foreseeable asset growth, break points in
the management fee were not necessary at this time. As assets increase,
the Trustees will continue to evaluate annually the appropriateness of
break points.
H. Other Benefits to the Investment Adviser. The Trustees also considered the
character and amount of fees paid by the Fund, other than under the
Management Contract, for services provided by the Investment Adviser and
affiliates, including fees for services such as shareowner services. The
Trustees also considered the receipt of sales loads and payments under
Rule 12b-1 plans in respect of the Pioneer Funds (including the Fund), and
benefits to the Investment Adviser from the use of "soft" commission
dollars to pay for research and brokerage services. The Trustees further
considered the revenues and profitability of the Investment Adviser's
businesses other than the fund business, including the Investment
Adviser's institutional investment advisory business. The Trustees
considered the intangible benefits that accrue to the Investment Adviser
and its affiliates by virtue of its relationship with the Fund and the
Pioneer Funds as a group. The Trustees concluded that all these types of
benefits accruing to the Investment Adviser were reasonable in the context
of the overall relationship between the Investment Adviser and the Fund.
Conclusion. The Trustees, in light of the Investment Adviser's overall
performance, considered it appropriate to continue to retain the management
services of the Investment Adviser. Based on their evaluation of all material
factors deemed relevant and the advice of independent counsel, the Trustees
concluded that the Management Contract with the Fund is fair and reasonable and
voted to approve the continuation of the Management Contract for another year.
49
Pioneer Emerging Markets Fund
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TRUSTEES, OFFICERS AND SERVICE PROVIDERS
- --------------------------------------------------------------------------------
Trustees
John F. Cogan, Jr., Chairman
David R. Bock
Mary K. Bush
Margaret B.W. Graham
Osbert M. Hood
Marguerite A. Piret
Stephen K. West
John Winthrop
Officers
John F. Cogan, Jr., President
Osbert M. Hood, Executive
Vice President
Vincent Nave, Treasurer
Dorothy E. Bourassa, Secretary
Investment Adviser and Administrator
Pioneer Investment Management, Inc.
Custodian
Brown Brothers Harriman & Co.
Principal Underwriter
Pioneer Funds Distributor, Inc.
Legal Counsel
Wilmer Cutler Pickering Hale and Dorr LLP
Shareowner Services and Transfer Agent
Pioneer Investment Management Shareholder Services, Inc.
Proxy Voting Policies and Procedures of the Fund are available without charge,
upon request, by calling our toll free number (1-800-225-6292). Information
regarding how the Fund voted proxies relating to portfolio securities during
the most recent 6-month period ended August 31, 2004 is publicly available to
shareowners at www.pioneerfunds.com. This information is also available on the
Securities and Exchange Commission's web site at http://www.sec.gov.
50
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THE PIONEER FAMILY OF MUTUAL FUNDS
- --------------------------------------------------------------------------------
Please consider a fund's investment objectives, risks, charges and expenses
carefully before investing. The prospectus contains this and other information
about a fund and should be read carefully before you invest or send money. To
obtain a prospectus and for other information on any Pioneer fund, contact your
advisor, call 1-800-225-6292 or visit our web site at www.pioneerfunds.com.
U.S. Equity
Pioneer Fund
Pioneer Balanced Fund
Pioneer Cullen Value Fund
Pioneer Equity Income Fund
Pioneer Equity Opportunity Fund
Pioneer Growth Opportunities Fund
Pioneer Growth Shares
Pioneer Mid Cap Growth Fund
Pioneer Mid Cap Value Fund
Pioneer Oak Ridge Large Cap
Growth Fund
Pioneer Oak Ridge Small Cap
Growth Fund**
Pioneer AmPac Growth Fund(1)
Pioneer Small and Mid Cap
Growth Fund(2)
Pioneer Growth Leaders Fund(3)
Pioneer Strategic Growth Fund(4)
Pioneer Real Estate Shares
Pioneer Research Fund
Pioneer Small Cap Value Fund
Pioneer Small Company Fund
Pioneer Value Fund
Asset Allocation
Pioneer Ibbotson Moderate
Allocation Fund
Pioneer Ibbotson Growth
Allocation Fund
Pioneer Ibbotson Aggressive
Allocation Fund
Pioneer Ibbotson Conservative
Allocation Fund
International/Global Equity
Pioneer Emerging Markets Fund
Pioneer Europe Select Equity Fund
Pioneer International Equity Fund
Pioneer International Value Fund
Fixed Income
Pioneer America Income Trust
Pioneer Bond Fund
Pioneer California Tax Free
Income Fund
Pioneer Global High Yield Fund
Pioneer High Yield Fund
Pioneer Municipal Bond Fund
Pioneer Short Term Income Fund
Pioneer Strategic Income Fund
Pioneer Tax Free Income Fund
Money Market
Pioneer Cash Reserves Fund*
Pioneer Tax Free Money Market Fund
1 Formerly Pioneer Papp America-Pacific Rim Fund
2 Formerly Pioneer Papp Small and Mid Cap Growth Fund
3 Formerly Pioneer Papp Stock Fund
4 Formerly Pioneer Papp Strategic Growth Fund
* An investment in the Fund is not insured or guaranteed by the Federal Deposit
Insurance Corporation or any other government agency. Although the Fund seeks
to preserve the value of your investment at $1.00 per share, it is possible to
lose money by investing in the Fund.
** Effective May 26, 2005, Pioneer Oak Ridge Small Cap Growth Fund is generally
closed to new investors. Purchases in the Fund will be limited to existing
investors.
51
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This page for your notes.
52
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HOW TO CONTACT PIONEER
- --------------------------------------------------------------------------------
We are pleased to offer a variety of convenient ways for you to contact us for
assistance or information.
Call us for:
Account Information, including existing accounts,
new accounts, prospectuses, applications
and service forms 1-800-225-6292
FactFone(SM) for automated fund yields, prices,
account information and transactions 1-800-225-4321
Retirement plans information 1-800-622-0176
Telecommunications Device for the Deaf (TDD) 1-800-225-1997
Write to us:
PIMSS, Inc.
P.O. Box 55014
Boston, Massachusetts 02205-5014
Our toll-free fax 1-800-225-4240
Our internet e-mail address ask.pioneer@pioneerinvest.com
(for general questions about Pioneer only)
Visit our web site: www.pioneerfunds.com
Please consider the Fund's investment objectives, risks, charges and expenses
carefully before investing. The prospectus contains this and other information
about the Fund and should be read carefully before you invest or send money.
To obtain a prospectus and for other information on any Pioneer fund, call
1-800-225-6292 or visit our web site www.pioneerfunds.com.
The Fund files a complete statement of investments with the Securities and
Exchange Commission for the first and third quarters for each fiscal year on
Form N-Q. Shareholders may view the filed Form N-Q by visiting the
Commission's web site at http://www.sec.gov. The filed form may also be viewed
and copied at the Commission's Public Reference Room in Washington, DC.
Information regarding the operations of the Public Reference Room may be
obtained by calling 1-800-SEC-0330.
ITEM 2. CODE OF ETHICS.
(a) Disclose whether, as of the end of the period covered by the report, the
registrant has adopted a code of ethics that applies to the registrant's
principal executive officer, principal financial officer, principal accounting
officer or controller, or persons performing similar functions, regardless of
whether these individuals are employed by the registrant or a third party. If
the registrant has not adopted such a code of ethics, explain why it has not
done so.
The registrant has adopted, as of the end of the period covered by this report,
a code of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer and controller.
(b) For purposes of this Item, the term "code of ethics" means written standards
that are reasonably designed to deter wrongdoing and to promote:
(1) Honest and ethical conduct, including the ethical handling of actual
or apparent conflicts of interest between personal and professional
relationships;
(2) Full, fair, accurate, timely, and understandable disclosure in
reports and documents that a registrant files with, or submits to, the
Commission and in other public communications made by the registrant;
(3) Compliance with applicable governmental laws, rules, and
regulations;
(4) The prompt internal reporting of violations of the code to an
appropriate person or persons identified in the code; and
(5) Accountability for adherence to the code.
(c) The registrant must briefly describe the nature of any amendment, during the
period covered by the report, to a provision of its code of ethics that applies
to the registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the
registrant or a third party, and that relates to any element of the code of
ethics definition enumerated in paragraph (b) of this Item. The registrant must
file a copy of any such amendment as an exhibit pursuant to Item 10(a), unless
the registrant has elected to satisfy paragraph (f) of this Item by posting its
code of ethics on its website pursuant to paragraph (f)(2) of this Item, or by
undertaking to provide its code of ethics to any person without charge, upon
request, pursuant to paragraph (f)(3) of this Item.
The registrant has made no amendments to the code of ethics during the period
covered by this report.
(d) If the registrant has, during the period covered by the report, granted a
waiver, including an implicit waiver, from a provision of the code of ethics to
the registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the
registrant or a third party, that relates to one or more of the items set forth
in paragraph (b) of this Item, the registrant must briefly describe the nature
of the waiver, the name of the person to whom the waiver was granted, and the
date of the waiver.
Not applicable.
(e) If the registrant intends to satisfy the disclosure requirement under
paragraph (c) or (d) of this Item regarding an amendment to, or a waiver from,
a provision of its code of ethics that applies to the registrant's principal
executive officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions and that relates to any
element of the code of ethics definition enumerated in paragraph (b) of this
Item by posting such information on its Internet website, disclose the
registrant's Internet address and such intention.
Not applicable.
(f) The registrant must:
(1) File with the Commission, pursuant to Item 10(a), a copy of its code
of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer or controller,
or persons performing similar functions, as an exhibit to its annual
report on this Form N-CSR;
(2) Post the text of such code of ethics on its Internet website and
disclose, in its most recent report on this Form N-CSR, its Internet
address and the fact that it has posted such code of ethics on its
Internet website; or
(3) Undertake in its most recent report on this Form N-CSR to provide to
any person without charge, upon request, a copy of such code of ethics
and explain the manner in which such request may be made.
See Item 10(2)
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a) (1) Disclose that the registrant's board of trustees has determined that
the registrant either:
(i) Has at least one audit committee financial expert serving on its audit
committee; or
(ii) Does not have an audit committee financial expert serving on its audit
committee.
The registrant's Board of Trustees has determined that the registrant has at
least one audit committee financial expert.
(2) If the registrant provides the disclosure required by paragraph
(a)(1)(i) of this Item, it must disclose the name of the audit committee
financial expert and whether that person is "independent." In order to be
considered "independent" for purposes of this Item, a member of an audit
committee may not, other than in his or her capacity as a member of the audit
committee, the board of trustees, or any other board committee:
(i) Accept directly or indirectly any consulting, advisory, or other
compensatory fee from the issuer; or
(ii) Be an "interested person" of the investment company as defined in
Section 2(a)(19) of the Act (15 U.S.C. 80a-2(a)(19)).
Ms. Marguerite A. Piret, an independent trustee, is such an audit committee
financial expert.
(3) If the registrant provides the disclosure required by paragraph (a)(1)
(ii) of this Item, it must explain why it does not have an audit committee
financial expert.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Disclose, under the caption AUDIT FEES, the aggregate fees billed for each
of the last two fiscal years for professional services rendered by the principal
accountant for the audit of the registrant's annual financial statements or
services that are normally provided by the accountant in connection with
statutory and regulatory filings or engagements for those fiscal years.
N/A
(b) Disclose, under the caption AUDIT-RELATED FEES, the aggregate fees billed in
each of the last two fiscal years for assurance and related services by the
principal accountant that are reasonably related to the performance of the audit
of the registrant's financial statements and are not reported under
paragraph (a) of this Item. Registrants shall describe the nature of the
services comprising the fees disclosed under this category.
N/A
(c) Disclose, under the caption TAX FEES, the aggregate fees billed in each of
the last two fiscal years for professional services rendered by the principal
accountant for tax compliance, tax advice, and tax planning. Registrants shall
describe the nature of the services comprising the fees disclosed under this
category.
N/A
(d) Disclose, under the caption ALL OTHER FEES, the aggregate fees billed in
each of the last two fiscal years for products and services provided by the
principal accountant, other than the services reported in paragraphs (a) through
(c) of this Item. Registrants shall describe the nature of the services
comprising the fees disclosed under this category.
N/A
(e) (1) Disclose the audit committee's pre-approval policies and procedures
described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.
PIONEER FUNDS
APPROVAL OF AUDIT, AUDIT-RELATED, TAX AND OTHER SERVICES
PROVIDED BY THE INDEPENDENT AUDITOR
SECTION I - POLICY PURPOSE AND APPLICABILITY
The Pioneer Funds recognize the importance of maintaining the independence of
their outside auditors. Maintaining independence is a shared responsibility
involving Pioneer Investment Management, Inc ("PIM"), the audit committee and
the independent auditors.
The Funds recognize that a Fund's independent auditors: 1) possess knowledge of
the Funds, 2) are able to incorporate certain services into the scope of the
audit, thereby avoiding redundant work, cost and disruption of Fund personnel
and processes, and 3) have expertise that has value to the Funds. As a result,
there are situations where it is desirable to use the Fund's independent
auditors for services in addition to the annual audit and where the potential
for conflicts of interests are minimal. Consequently, this policy, which is
intended to comply with Rule 210.2-01(C)(7), sets forth guidelines and
procedures to be followed by the Funds when retaining the independent audit firm
to perform audit, audit-related tax and other services under those
circumstances, while also maintaining independence.
Approval of a service in accordance with this policy for a Fund shall also
constitute approval for any other Fund whose pre-approval is required pursuant
to Rule 210.2-01(c)(7)(ii).
In addition to the procedures set forth in this policy, any non-audit services
that may be provided consistently with Rule 210.2-01 may be approved by the
Audit Committee itself and any pre-approval that may be waived in accordance
with Rule 210.2-01(c)(7)(i)(C) is hereby waived.
Selection of a Fund's independent auditors and their compensation shall be
determined by the Audit Committee and shall not be subject to this policy.
SECTION II - POLICY
- ---------------- -------------------------------- -------------------------------------------------
SERVICE SERVICE CATEGORY DESCRIPTION SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
CATEGORY
- ---------------- -------------------------------- -------------------------------------------------
I. AUDIT Services that are directly o Accounting research assistance
SERVICES related to performing the o SEC consultation, registration
independent audit of the Funds statements, and reporting
o Tax accrual related matters
o Implementation of new accounting
standards
o Compliance letters (e.g. rating agency
letters)
o Regulatory reviews and assistance
regarding financial matters
o Semi-annual reviews (if requested)
o Comfort letters for closed end
offerings
- ---------------- -------------------------------- -------------------------------------------------
II. Services which are not o AICPA attest and agreed-upon procedures
AUDIT-RELATED prohibited under Rule o Technology control assessments
SERVICES 210.2-01(C)(4) (the "Rule") o Financial reporting control assessments
and are related extensions of o Enterprise security architecture
the audit services support the assessment
audit, or use the
knowledge/expertise gained
from the audit procedures as a
foundation to complete the
project. In most cases, if
the Audit-Related Services are
not performed by the Audit
firm, the scope of the Audit
Services would likely
increase. The Services are
typically well-defined and
governed by accounting
professional standards (AICPA,
SEC, etc.)
- ---------------- -------------------------------- -------------------------------------------------
------------------------------------- ------------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the audit period for all services and related fees
pre-approved specific service reported at each regularly
subcategories. Approval of the scheduled Audit Committee
independent auditors as meeting.
auditors for a Fund shall
constitute pre approval for
these services.
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the fund fiscal year within services and related fees
a specified dollar limit (including comparison to
for all pre-approved specified dollar limits)
specific service subcategories reported quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limit for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for Audit-Related
Services not denoted as
"pre-approved", or
to add a specific service
subcategory as "pre-approved"
------------------------------------- ------------------------------------
SECTION III - POLICY DETAIL, CONTINUED
- ----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
- ----------------------- --------------------------- -----------------------------------------------
III. TAX SERVICES Services which are not o Tax planning and support
prohibited by the Rule, o Tax controversy assistance
if an officer of the Fund o Tax compliance, tax returns, excise
determines that using the tax returns and support
Fund's auditor to provide o Tax opinions
these services creates
significant synergy in
the form of efficiency,
minimized disruption, or
the ability to maintain a
desired level of
confidentiality.
- ----------------------- --------------------------- -----------------------------------------------
- ------------------------------------- -------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
- ------------------------------------- -------------------------
- ------------------------------------- -------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year all such services and
within a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for tax services not
denoted as pre-approved, or to add a specific
service subcategory as
"pre-approved"
- ------------------------------------- -------------------------
SECTION III - POLICY DETAIL, CONTINUED
- ----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
- ----------------------- --------------------------- -----------------------------------------------
IV. OTHER SERVICES Services which are not o Business Risk Management support
prohibited by the Rule, o Other control and regulatory
A. SYNERGISTIC, if an officer of the Fund compliance projects
UNIQUE QUALIFICATIONS determines that using the
Fund's auditor to provide
these services creates
significant synergy in
the form of efficiency,
minimized disruption,
the ability to maintain a
desired level of
confidentiality, or where
the Fund's auditors
posses unique or superior
qualifications to provide
these services, resulting
in superior value and
results for the Fund.
- ----------------------- --------------------------- -----------------------------------------------
- --------------------------------------- ------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
- ------------------------------------- --------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year within all such services and
a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for "Synergistic" or
"Unique Qualifications" Other
Services not denoted as
pre-approved to the left, or to
add a specific service
subcategory as "pre-approved"
- ------------------------------------- --------------------------
SECTION III - POLICY DETAIL, CONTINUED
- ----------------------- ------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PROHIBITED SERVICE SUBCATEGORIES
DESCRIPTION
- ----------------------- ------------------------- -----------------------------------------------
PROHIBITED SERVICES Services which result 1. Bookkeeping or other services
in the auditors losing related to the accounting records or
independence status financial statements of the audit
under the Rule. client*
2. Financial information systems design
and implementation*
3. Appraisal or valuation services,
fairness* opinions, or
contribution-in-kind reports
4. Actuarial services (i.e., setting
actuarial reserves versus actuarial
audit work)*
5. Internal audit outsourcing services*
6. Management functions or human
resources
7. Broker or dealer, investment
advisor, or investment banking services
8. Legal services and expert services
unrelated to the audit
9. Any other service that the Public
Company Accounting Oversight Board
determines, by regulation, is
impermissible
- ----------------------- ------------------------- -----------------------------------------------
- ------------------------------------------- ------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
- ------------------------------------------- ------------------------------
o These services are not to be o A summary of all
performed with the exception of the(*) services and related
services that may be permitted fees reported at each
if they would not be subject to audit regularly scheduled
procedures at the audit client (as Audit Committee meeting
defined in rule 2-01(f)(4)) level will serve as continual
the firm providing the service. confirmation that has
not provided any
restricted services.
- ------------------------------------------- ------------------------------
- --------------------------------------------------------------------------------
GENERAL AUDIT COMMITTEE APPROVAL POLICY:
o For all projects, the officers of the Funds and the Fund's auditors will each
make an assessment to determine that any proposed projects will not impair
independence.
o Potential services will be classified into the four non-restricted service
categories and the "Approval of Audit, Audit-Related, Tax and Other
Services" Policy above will be applied. Any services outside the specific
pre-approved service subcategories set forth above must be specifically
approved by the Audit Committee.
o At least quarterly, the Audit Committee shall review a report summarizing the
services by service category, including fees, provided by the Audit firm as
set forth in the above policy.
- --------------------------------------------------------------------------------
(2) Disclose the percentage of services described in each of paragraphs (b)
through (d) of this Item that were approved by the audit committee pursuant
to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
N/A
(f) If greater than 50 percent, disclose the percentage of hours expended on the
principal accountant's engagement to audit the registrant's financial statements
for the most recent fiscal year that were attributed to work performed by
persons other than the principal accountant's full-time, permanent employees.
N/A
(g) Disclose the aggregate non-audit fees billed by the registrant's accountant
for services rendered to the registrant, and rendered to the registrant's
investment adviser (not including any sub-adviser whose role is primarily
portfolio management and is subcontracted with or overseen by another investment
adviser), and any entity controlling, controlled by, or under common control
with the adviser that provides ongoing services to the registrant for each of
the last two fiscal years of the registrant.
The Fund's independent auditor, Ernst & Young
LLP ("E&Y"), has advised the Securities
and Exchange Commission, the Public Company
Accounting Oversight Board, and the Audit
Committee of the Fund's Board of Trustees that
certain non-audit work performed by E&Y's China
affiliate raised questions regarding E&Y's
independence with respect to its performance of
audit services for the Fund. In July 2004, E&Y
became aware that member firms in China ("E&Y
China") provided certain tax services to offices of
UniCredito Italiano, S.p.A. ("UCI"), a member of
the Fund's Investment Company Complex. The
services included receipt and disbursement of
monies transferred to E&Y China by UCI in
payment of individual expatriate income taxes due
on returns prepared by E&Y China for certain UCI
employees located in China from October 1998 to
May 2003. E&Y became auditors of the Fund in
May 2002. These expatriate tax services were
discontinued in May 2003. The fees received by
E&Y China for all such services totaled $3,685.
The Fund's Audit Committee and E&Y have
discussed the matter, including the nature of the
services provided, the personnel involved in
providing the services and the fees received by
E&Y for performing the services. E&Y has informed
the Audit Committee that based on its internal reviews
and the de minimis nature of the services provided and
fees received, it does not believe its independence
with respect to the Fund has been impaired.
N/A
(h) Disclose whether the registrant's audit committee of the board of trustees
has considered whether the provision of non-audit services that were rendered to
the registrant's investment adviser (not including any subadviser whose role is
primarily portfolio management and is subcontracted with or overseen by another
investment adviser), and any entity controlling, controlled by, or under common
control with the investment adviser that provides ongoing services to the
registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of
Rule 2-01 of Regulation S-X is compatible with maintaining the principal
accountant's independence.
N/A
ITEMS 5-6. [RESERVED]
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
A closed-end management investment company that is filing an annual report on
this Form N-CSR must, unless it invests exclusively in non-voting securities,
describe the policies and procedures that it uses to determine how to vote
proxies relating to portfolio securities, including the procedures that the
company uses when a vote presents a conflict between the interests of its
shareholders, on the one hand, and those of the company's investment adviser;
principal underwriter; or any affiliated person (as defined in Section 2(a)(3)
of the Investment Company Act of 1940 (15 U.S.C. 80a-2(a)(3)) and the rules
thereunder) of the company, its investment adviser, or its principal
underwriter, on the other. Include any policies and procedures of the company's
investment adviser, or any other third party, that the company uses, or that are
used on the company's behalf, to determine how to vote proxies relating to
portfolio securities.
Not applicable to open-end management investment companies.
ITEM 8. [RESERVED]
ITEM 9. CONTROLS AND PROCEDURES.
(a) Disclose the conclusions of the registrant's principal executive officer or
officers and principal financial officer or officers, or persons performing
similar functions, about the effectiveness of the registrant's disclosure
controls and procedures (as defined in Rule 30a-2(c) under the Act (17 CFR
270.30a-2(c))) based on their evaluation of these controls and procedures as of
a date within 90 days of the filing date of the report that includes the
disclosure required by this paragraph.
The registrant's principal executive officer and principal financial
officer have concluded, that the registrant's disclosure controls and
procedures are effective based on their evaluation of these controls and
procedures as of a date within 90 days of the filing date of this report.
(b) Disclose whether or not there were significant changes in the registrant's
internal controls or in other factors that could significantly affect these
controls subsequent to the date of their evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
There were no significant changes in the registrant's internal controls or
in other factors that could significantly affect these controls subsequent to
the date of their evaluation, including any corrective actions with regard
to significant deficiencies and material weaknesses.
ITEM 10. EXHIBITS.
File the exhibits listed below as part of this Form. Letter or number the
exhibits in the sequence indicated.
(a) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit.
(b) A separate certification for each principal executive officer and principal
financial officer of the registrant as required by Rule 30a-2 under the Act
(17 CFR 270.30a-2).
Filed herewith.
SIGNATURES
[See General Instruction F]
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Pioneer Emerging Markets Fund
By (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr, President
Date July 29, 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.
By (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr., President
Date July 29, 2005
By (Signature and Title)* /s/ Vincent Nave
Vincent Nave, Treasurer
Date July 29, 2005
* Print the name and title of each signing officer under his or her signature.