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 811-5615 John Hancock Patriot Premium Dividend Fund I (Exact name of registrant as specified in charter) 101 Huntington Avenue, Boston, Massachusetts 02199 (Address of principal executive offices) (Zip code) Susan S. Newton, Secretary 101 Huntington Avenue Boston, Massachusetts 02199 (Name and address of agent for service) Registrant's telephone number, including area code: 617-375-1702 Date of fiscal year end: September 30 Date of reporting period: September 30, 2004 ITEM 1. REPORT TO SHAREHOLDERS. JOHN HANCOCK Patriot Premium Dividend Fund I 9.30.2004 Annual Report [A 2" x 1" John Hancock (Signature)/John Hancock Funds logo in lower, center middle of page. A tag line below reads "JOHN HANCOCK FUNDS."] [A photo of James A Shepherdson, Chief Executive Officer, flush left next to first paragraph.] CEO CORNER Table of contents Your fund at a glance page 1 Managers' report page 2 Fund's investments page 6 Financial statements page 11 Trustees & officers page 26 For more information page 29 Dear Fellow Shareholders, The stock market has made little, if any, headway so far in 2004, as it has wrestled with a variety of uncertainties. Questions about the continuing strength of the economy and the effects of rising interest rates, and expectations for corporate earnings growth, kept investors jittery. In addition, crude oil prices at levels beyond historic highs, geopolitical issues and a closely contested U.S. presidential race all weighed on the market. As a result, the Standard & Poor's 500 Index is up just 1.51% year-to-date through September, while the Dow Jones Industrial Average and the Nasdaq Composite Index have lost ground slightly, returning - -2.06% and -5.00%, respectively. Despite the Federal Reserve's three hikes in short-term interest rates from historic lows, bonds still managed to outperform stocks, with the Lehman Brothers Aggregate Bond Index up 3.35%. In news closer to home, we are pleased to announce that on June 15, 2004, your fund's Board of Trustees appointed Charles L. Ladner as independent Chairman of the Board of Trustees, a position previously held by John Hancock Funds LLC's former Chairman and Chief Executive Officer, Maureen Ford Goldfarb. This appointment came in advance of new SEC regulations requiring all mutual funds to have independent chairmen. Mr. Ladner has served as an independent member of John Hancock Funds' Board of Trustees since 1992 and formerly held the position of Senior Vice President and Chief Financial Officer of UGI Corporation, a public utility holding company in Valley Forge, PA, until his retirement in 1998. He brings a wealth of knowledge, experience and leadership and we are delighted to have him serve as Chairman. Sincerely, /S/ JAMES A. SHEPHERDSON James A. Shepherdson, Chief Executive Officer This commentary reflects the CEO's views as of September 30, 2004. They are subject to change at any time. YOUR FUND AT A GLANCE The Fund seeks to provide high current income, consistent with modest growth of capital, for hold- ers of its common shares by investing at least 80% of its assets in dividend- paying securities. Over the last twelve months * Preferred stocks were volatile in response to shifting views about the direction of the economy, inflation and interest rates. * The Fund's performance was helped by its holdings in utility common stocks, although one holding in that group proved particularly disappointing. * High-quality, fully taxable preferred holdings helped the Fund's performance. [Bar chart with heading "John Hancock Patriot Premium Dividend Fund I." Under the heading is a note that reads "Fund performance for the year ended September 30, 2004." The chart is scaled in increments of 5% with 0% at the bottom and 15% at the top. The first bar represents the 13.40% net asset value for John Hancock Patriot Premium Dividend Fund I. The second bar represents the 9.76% market value for John Hancock Patriot Premium Dividend Fund I. A note below the chart reads "The total returns for the Fund include the reinvestment of all distributions. The performance data contained within this material represents past performance, which does not guarantee future results."] Top 10 issuers 7.3% NSTAR 5.6% Energy East Corp. 4.6% Lehman Brothers Holdings, Inc. 4.4% Shaw Communications, Inc. 4.0% Baltimore Gas & Electric Co. 3.4% El Paso Tennessee Pipeline Co. 3.4% Sierra Pacific Power Co. 3.1% CH Energy Group, Inc. 2.8% South Carolina Electric & Gas Co. 2.6% Alabama Power Co. As a percentage of net assets plus value of preferred shares on September 30, 2004. 1 BY GREGORY K. PHELPS AND MARK T. MALONEY FOR THE PORTFOLIO MANAGEMENT TEAM MANAGERS' REPORT JOHN HANCOCK Patriot Premium Dividend Fund I Preferred stocks -- which are the primary emphasis of John Hancock Patriot Premium Dividend Fund I -- were on a proverbial roller-coaster ride during the 12 months ended September 30, 2004, fluctuating in response to changing expectations about the economy, inflation and interest rates. Preferred stocks began the period on somewhat of a weak footing when faster-than-expected economic growth fanned fears of higher interest rates and caused preferreds to lapse into negative territory. Because preferreds make fixed payments in the form of dividends, their prices, like bonds, tend to move in the opposite direction of expectations for potential interest rates moves. Later, a wintertime preferred stock rally was triggered by weaker-than-expected employment data and comments from the Fed indicating that interest rate hikes were still distant. In the spring, the preferred market sold off once more when a string of stronger-than-expected economic reports and Fed Chairman Alan Greenspan's Congressional testimony convinced investors that the Fed would raise interest rates sooner than expected. But in the final three months of the period, preferreds stabilized and later rallied as investors anticipated three rate hikes, followed by reassuring comments from the Fed suggesting it would take a "measured" approach to subsequent rate hikes. "Preferred stocks ... were on a proverbial roller-coaster ride during the 12 months ended September 30, 2004..." Utility commons outperform Utility common stocks enjoyed much more favorable conditions and produced far better returns than preferreds for the year, defying historical trends by doing well when interest rates were on the rise. Some of their success owed to the 2003 reduction in taxes individuals pay on most stock dividends. Utilities traditionally have offered consistently high dividends over the years, and those with dividends subject to tax relief benefited the most during the period. Another 2 factor aiding the group was its overall improved financial condition, the result of utilities' efforts to reduce debt, improve their balance sheets and shed money-losing unregulated subsidiaries. [Photos of Greg Phelps and Mark Maloney flush right next to first paragraph.] Performance For the 12 months ended September 30, 2004, John Hancock Patriot Premium Dividend Fund I posted total returns of 13.40% at net asset value and 9.76% at market value. The difference in the Fund's net asset value (NAV) performance and its market performance stems from the fact that the market share price is subject to the dynamics of secondary market trading, which could cause it to trade at a discount or premium to the Fund's NAV share price at any time. By comparison, the average income and preferred stock closed-end fund returned 12.30% at net asset value, according to Lipper, Inc. In the same 12-month period, the Dow Jones Utility Average -- which tracks the performance of 15 electric and natural gas utilities -- returned 22.34%, and the broader stock market, as measured by the Standard & Poor's 500 Index, returned 13.86%. Performance boosters Among the Fund's best performers for the year were some utility common stocks, including our holdings in Dominion Resources. The company, a fully integrated gas and electric holding company, benefited from strong results from its regulated electric operation and from improving trends in its gas operations due to rising energy prices. Our holdings in Ameren Corp., an electric and natural gas utility serving Missouri and Southern Illinois, also benefited performance. Investors liked the company's acquisition of Illinois Power, which will add to the company's stable regulated operations, further supporting an attractive dividend payout. A disappointment among our utility common holdings was Kansas-City based Aquila, an electric and gas energy provider that has been punished by investors after retreating from the wholesale energy-trading markets. Despite the company's challenges in fighting its way back, we continue to maintain our stake in Aquila because it has taken a number of positive steps to rebuild its balance sheet. It has extracted itself from money-losing gas supply "Among the Fund's best performers for the year were some utility common stocks..." 3 contracts and executed a successful common and preferred stock offering, the proceeds of which were used to retire high-cost debt, lowering interest costs. [Table at top left-hand side of page entitled "Top five industry groups1." The first listing is Electric utilities 58%, the second is Investment banking & brokerage 11%, the third is Gas utilities 8%, the fourth is Oil & gas exploration & production 8%, and the fifth is Broadcasting & cable TV 4%.] Preferreds Even in a period when tax policy favored tax-advantaged preferred stocks, a number of our fully taxable preferred holdings were our best performers due to the combination of a lack of supply and rising demand. Standouts included our holdings in Baltimore Gas & Electric, which benefited from the fact that it was a relatively scarce, higher-quality issue with good call protection, meaning that it couldn't be redeemed by its issuer for a stated period of time. Another investment-grade holding that benefited from scarcity was HECO Capital Trust, which is issued by Hawaiian Electric. In addition, we enjoyed good gains from Coastal Finance, a subsidiary of El Paso Corporation, which rallied as El Paso sold non-core assets, paid down debt and improved its balance sheet. [Pie chart in middle of page with heading "Portfolio diversification1" The chart is divided into three sections (from top to right): Preferred stocks 64%, Common stocks 32% and Short-term investments 4%.] Outlook There's been a kind of disconnect between recent Fed actions and the bond and preferred markets' reactions over the past several months. Contrary to historical patterns, bonds and preferreds have recently rallied as rates rose. In our view, this counter-intuitive reaction suggests that the bond market may be forecasting that high and rising oil prices, plus the recent interest rate increases themselves, may be the catalysts for slower economic growth down the road. Moreover, it appears that there are some other crosscurrents that could work against the economy, namely a slowdown in consumer 4 consumption as home loan refinancings slow, and the potential lack of new tax cuts to spur spending. That said, the Fed has indicated that it is leaning toward future rate increases. If the economy strengthens and there is more upward pressure on interest rates than the market currently anticipates, preferreds could undergo a period of lackluster performance. On the other hand, stable or falling rates would likely bode well for preferreds. As for utility common stocks, we remain optimistic about their prospects. The utility companies' improving financial health should continue to catch the eye of investors looking for high dividend-paying defensive stocks. [Table at top of page entitled "SCORECARD." The header for the left column is "INVESTMENT" and the header for the right column is "PERIOD'S PERFORMANCE...AND WHAT'S BEHIND THE NUMBERS." The first listing is Coastal Finance followed by an up arrow with the phrase "Parent company's moves help subsidiary." The second listing is Dominion Resources by an up arrow with the phrase "Rising energy prices help boost financial performance." The third listing is Aquila, Inc. followed by a down arrow with the phrase "Residual problems with energy trading."] "... stable or falling rates would likely bode well for preferreds." This commentary reflects the views of the portfolio management team through the end of the Fund's period discussed in this report. The managers' statements reflect their own opinions. As such, they are in no way guarantees of future events, and are not intended to be used as investment advice or a recommendation regarding any specific security. They are also subject to change at any time as market and other conditions warrant. The Fund normally will invest more than 65% of its managed assets in securities of companies in the utilities industry. Such an investment concentration makes the Fund more susceptible than a more broadly diversified fund to factors adversely affecting the utilities industry. Sector investing is subject to greater risks than the market as a whole. 1 As a percentage of the Fund's portfolio on September 30, 2004. 5 FINANCIAL STATEMENTS FUND'S INVESTMENTS Securities owned by the Fund on September 30, 2004 This schedule is divided into three main categories: common stocks, preferred stocks, and short-term investments. The stocks are further broken down by industry group. Short-term investments, which represent the Fund's cash position, are listed last. Issuer Shares Value Common stocks 47.24% $66,653,009 (Cost $68,185,502) Electric Utilities 41.25% 58,196,556 Alliant Energy Corp. 150,380 3,741,454 Ameren Corp. 45,900 2,118,285 Aquila, Inc. (I) 180,000 561,600 CH Energy Group, Inc. 141,350 6,473,830 Consolidated Edison, Inc. 32,000 1,345,280 Dominion Resources, Inc. 64,300 4,195,575 DTE Energy Co. 126,000 5,315,940 Duke Energy Corp. 40,000 915,600 Energy East Corp. 257,000 6,471,260 NiSource, Inc. 67,600 1,420,276 NSTAR 175,000 8,592,500 Progress Energy, Inc. 52,500 2,222,850 Progress Energy, Inc. (Contingent Value Obligation) (B)(I) 69,000 11,040 Public Service Enterprise Group, Inc. 16,000 681,600 Puget Energy, Inc. 216,900 4,923,630 Sierra Pacific Resources (I) 246,600 2,207,070 TECO Energy, Inc. 173,000 2,340,690 WPS Resources Corp. 40,400 1,817,596 Xcel Energy, Inc. 164,000 2,840,480 Gas Utilities 5.99% 8,456,000 KeySpan Corp. 136,450 5,348,840 National Fuel Gas Co. 47,150 1,335,760 Peoples Energy Corp. 42,500 1,771,400 Telecommunication Services 0.00% 453 Touch America Holdings, Inc. (I) 151,000 453 See notes to financial statements. 6 FINANCIAL STATEMENTS Credit Issuer, description rating (A) Shares Value Preferred stocks 95.90% $135,289,267 (Cost $136,922,424) Agricultural Products 1.86% 2,625,000 Ocean Spray Cranberries, Inc., 6.25%, Ser A (S) BB+ 35,000 2,625,000 Broadcasting & Cable TV 6.46% 9,116,875 Shaw Communications, Inc., 8.45%, Ser A (Canada) B+ 177,500 4,464,125 Shaw Communications, Inc., 8.50% (Canada) B+ 185,000 4,652,750 Consumer Finance 0.49% 687,000 SLM Corp., 6.97%, Ser A BBB+ 12,000 687,000 Diversified Banks 1.68% 2,373,738 Royal Bank of Scotland Group Plc, 5.75%, Ser B (United Kingdom) A 100,200 2,373,738 Electric Utilities 45.15% 63,698,591 Alabama Power Co., 5.20% BBB+ 225,000 5,512,500 Baltimore Gas & Electric Co., 6.99%, Ser 1995 Baa1 34,000 3,581,689 BGE Capital Trust II, 6.20% A3 190,000 4,769,000 Boston Edison Co., 4.25% BBB+ 57,879 4,514,562 Boston Edison Co., 4.78% BBB+ 24,668 2,183,118 Duquesne Light Co., 6.50% BB+ 20,000 1,030,000 Energy East Capital Trust I, 8.25% BBB- 200,000 5,338,000 FPC Capital I, 7.10%, Ser A BB+ 54,500 1,375,580 Georgia Power Co., 6.00%, Ser R A 213,800 5,233,824 Great Plains Energy, Inc., 4.35% BB+ 23,638 1,855,583 Great Plains Energy, Inc., 4.50% BB+ 12,510 960,518 HECO Capital Trust III, 6.50% BBB- 45,000 1,165,050 Monongahela Power Co., $7.73, Ser L CCC+ 34,500 3,286,125 PPL Electric Utilities Corp., 4.60% BBB 3,670 286,719 PSEG Funding Trust II, 8.75% BB+ 60,000 1,653,600 PSI Energy, Inc., 6.875% BBB- 37,000 3,885,000 Public Service Electric & Gas Co., 4.30%, Ser C BB+ 6,560 492,000 Public Service Electric & Gas Co., 6.92% BB+ 26,800 2,783,014 Sierra Pacific Power Co., 7.80%, Ser 1 (Class A) CCC+ 210,000 4,830,000 South Carolina Electric & Gas Co., 6.52% Baa1 55,000 5,793,909 TECO Capital Trust I, 8.50% Ba3 25,000 650,250 Virginia Electric & Power Co., $7.05 BBB 10,200 1,062,075 Xcel Energy, Inc., $4.11, Ser D BB+ 19,550 1,456,475 See notes to financial statements. 7 FINANCIAL STATEMENTS Credit Issuer, description rating (A) Shares Value Gas Utilities 6.20% $8,742,375 El Paso Tennessee Pipeline Co., 8.25%, Ser A CCC- 156,400 7,125,975 Southern Union Co., 7.55% BB+ 60,000 1,616,400 Integrated Oil & Gas 3.66% 5,160,000 Coastal Finance I, 8.375% CCC- 215,000 5,160,000 Investment Banking & Brokerage 16.52% 23,310,630 Bear Stearns Cos., Inc. (The), 5.72%, Ser F BBB 102,460 5,071,770 JP Morgan Chase & Co., 6.625%, Ser H A- 72,000 3,891,600 Lehman Brothers Holdings, Inc., 5.67%, Depositary Shares, Ser D BBB+ 102,700 5,114,460 Lehman Brothers Holdings, Inc., 5.94%, Depositary Shares, Ser C BBB+ 90,400 4,587,800 Merril Lynch & Co., Inc., 9.00%, Depositary Shares, Ser A A- 90,000 2,295,000 Morgan Stanley Capital Trust V, 5.75% A1 100,000 2,350,000 Oil and Gas Exploration & Production 12.17% 17,167,108 Anadarko Petroleum Corp., 5.46%, Depositary Shares, Ser B BBB- 45,278 4,489,314 Apache Corp., 5.68%, Depositary Shares, Ser B BBB 25,000 2,535,937 Devon Energy Corp., 6.49%, Ser A BBB- 50,000 5,231,250 Nexen, Inc., 7.35% (Canada) BBB- 183,300 4,910,607 Regional Banks 1.64% 2,306,250 HSBC USA, Inc., $2.8575 A1 45,000 2,306,250 Telecommunication Services 0.07% 101,700 Touch America Holdings, Inc., $6.875 (I) N/R 50,850 101,700 Interest Par value Issuer, description, maturity date rate (000) Value Short-term investments 5.54% $7,812,000 (Cost $7,812,000) Commercial Paper 5.54% 7,812,000 ChevronTexaco Corp., 10-01-04 1.700% $7,812 7,812,000 Total investments 148.68% $209,754,276 Other assets and liabilities, net (48.68%) ($68,682,422) Total net assets 100.00% $141,071,854 See notes to financial statements. 8 FINANCIAL STATEMENTS Notes to Schedule of Investments (A) Credit ratings are unaudited and are rated by Moody's Investors Service where Standard & Poor's ratings are not available. (B) This security is fair-valued in good faith under procedures established by the Board of Trustees. (I) Non-income-producing security. (S) This security is exempt from registration under rule 144A of the Securities Act of 1933. Such security may be resold, normally to qualified institutional buyers, in transactions exempt from registration. Rule 144A securities amounted to $2,625,000 or 1.86% of net assets as of September 30, 2004. Parenthetical disclosure of a foreign country in the security description represents country of a foreign issuer. The percentage shown for each investment category is the total value of that category as a percentage of the net assets of the Fund. See notes to financial statements. 9 FINANCIAL STATEMENTS PORTFOLIO CONCENTRATION September 30, 2004 This table shows the percentages of the Fund's investments aggregated by various industries. Industry distribution Value as a percentage of Fund's total investments Agricultural Products 1.25% Broadcasting & Cable TV 4.35 Consumer Finance 0.33 Diversified Banks 1.13 Electric Utilities 58.11 Gas Utilities 8.20 Integrated Oil & Gas 2.46 Investment Banking & Brokerage 11.11 Oil & Gas Exploration & Production 8.19 Regional Banks 1.10 Telecommunication Services 0.05 Short-term investments 3.72 Total investments 100.00% See notes to financial statements. 10 FINANCIAL STATEMENTS ASSETS AND LIABILITIES September 30, 2004 This Statement of Assets and Liabilities is the Fund's balance sheet. It shows the value of what the Fund owns, is due and owes. You'll also find the net asset value for each common share. Assets Investments, at value (cost $212,919,926) $209,754,276 Cash 141 Dividends receivable 647,651 Other assets 42,414 Total assets 210,444,482 Liabilities Payable for investments purchased 505,000 Payable to affiliates Management fees 166,712 Other 16,150 Other payables and accrued expenses 78,769 Total liabilities 766,631 Dutch Auction Rate Transferable Securities preferred shares Series A (DARTS), at value, unlimited number of shares of beneficial interest authorized with no par value, 685 shares issued, liquidation preference of $100,000 per share 68,605,997 Net assets Common shares capital paid-in 142,897,046 Accumulated net realized loss on investments (12,705) Net unrealized depreciation of investments (3,165,650) Accumulated net investment income 1,353,163 Net assets applicable to common shares $141,071,854 Net asset value per common share Based on 15,255,559 shares of beneficial interest outstanding -- unlimited number of shares authorized with no par value $9.25 See notes to financial statements. 11 FINANCIAL STATEMENTS OPERATIONS For the year ended September 30, 2004 This Statement of Operations summarizes the Fund's investment income earned and expenses incurred in operating the Fund. It also shows net gains (losses) for the period stated. Investment income Dividends $12,090,311 Interest 61,222 Total investment income 12,151,533 Expenses Investment management fees 1,643,299 Administration fees 207,188 DARTS auction fees 178,750 Federal excise tax 88,645 Transfer agent fees 46,943 Professional fees 44,060 Custodian fees 42,684 Printing 38,632 Miscellaneous 34,726 Registration and filing fees 24,217 Trustees' fees 12,538 Total expenses 2,361,682 Net investment income 9,789,851 Realized and unrealized gain Net realized gain on investments 66,438 Change in net unrealized appreciation (depreciation) of investments 8,308,808 Net realized and unrealized gain 8,375,246 Distributions to DARTS (836,184) Increase in net assets from operations $17,328,913 See notes to financial statements. 12 FINANCIAL STATEMENTS CHANGES IN NET ASSETS These Statements of Changes in Net Assets show how the value of the Fund's net assets has changed during the last two periods. The difference reflects earnings less expenses, any investment gains and losses and distributions, if any, paid to shareholders and any increase due to reinvestment of distributions. Year Year ended ended 9-30-03 9-30-04 Increase (decrease) in net assets From operations Net investment income $10,484,062 $9,789,851 Net realized gain 510,730 66,438 Change in net unrealized appreciation (depreciation) 7,579,644 8,308,808 Distributions to DARTS (906,591) (836,184) Increase in net assets resulting from operations 17,667,845 17,328,913 Distributions to common shareholders From net investment income (9,775,707) (10,919,843) From Fund share transactions 1,062,637 1,037,662 Net assets Beginning of period 124,670,347 133,625,122 End of period 1 $133,625,122 $141,071,854 1 Includes accumulated net investment income of $3,235,866 and $1,353,163, respectively. See notes to financial statements. 13 FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS COMMON SHARES The Financial Highlights show how the Fund's net asset value for a share has changed since the end of the previous period. Period ended 9-30-00 9-30-01 9-30-02 9-30-03 9-30-04 Per share operating performance Net asset value, beginning of period $9.91 $10.13 $9.74 $8.30 $8.82 Net investment income 1 0.85 0.83 0.78 0.69 0.64 Net realized and unrealized gain (loss) on investments 0.23 (0.39) (1.49) 0.54 0.56 Distributions to DARTS (0.21) (0.18) (0.08) (0.06) (0.05) Total from investment operations 0.87 0.26 (0.79) 1.17 1.15 Less distributions to common shareholders From net investment income (0.65) (0.65) (0.65) (0.65) (0.72) Net asset value, end of period $10.13 $9.74 $8.30 $8.82 $9.25 Per share market value, end of period $8.25 $8.75 $9.15 $9.24 $9.38 Total return at market value 2 (%) 1.19 13.79 12.03 8.91 9.76 Ratios and supplemental data Net assets applicable to common shares, end of period (in millions) $152 $146 $125 $134 $141 Ratio of expenses to average net assets 3 (%) 1.75 1.72 1.79 1.90 1.70 Ratio of net investment income to average net assets 4 (%) 8.94 8.35 8.42 8.33 7.06 Portfolio turnover (%) 19 23 11 10 16 Senior securities Total value of DARTS outstanding (in millions) $68 $68 $68 $69 $69 Involuntary liquidation preference per unit (in thousands) $100 $100 $100 $100 $100 Average market value per unit (in thousands) $100 $100 $100 $100 $100 Asset coverage per unit 5 $315,176 $318,208 $280,462 $287,811 $304,418 See notes to financial statements. 14 FINANCIAL HIGHLIGHTS Notes to Financial Highlights 1 Based on the average of the shares outstanding. 2 Assumes dividend reinvestment. 3 Ratios calculated on the basis of expenses relative to the average net assets of common shares. Without the exclusion of preferred shares, the ratio of expenses would have been 1.18%, 1.18%, 1.20%, 1.23% and 1.14%, respectively. 4 Ratios calculated on the basis of net investment income relative to the average net assets of common shares. Without the exclusion of preferred shares, the ratio of net investment income would have been 6.03%, 5.72%, 5.65%, 5.39% and 4.73%, respectively. 5 Calculated by subtracting the Fund's total liabilities from the Fund's total assets and dividing such amount by the number of DARTS outstanding as of the applicable 1940 Act Evaluation Date, which may differ from the financial reporting date. See notes to financial statements. 15 NOTES TO STATEMENTS Note A Accounting policies John Hancock Patriot Premium Dividend Fund I (the "Fund") is a diversified closed-end management investment company registered under the Investment Company Act of 1940. Significant accounting policies of the Fund are as follows: Valuation of investments Securities in the Fund's portfolio are valued on the basis of market quotations, valuations provided by independent pricing services or at fair value as determined in good faith in accordance with procedures approved by the Trustees. The Fund determines the net asset value of the common shares each business day. Investment transactions Investment transactions are recorded as of the date of purchase, sale or maturity. Net realized gains and losses on sales of investments are determined on the identified cost basis. Expenses The majority of expenses are directly identifiable to an individual fund. Expenses that are not readily identifiable to a specific fund are allocated in such a manner as deemed equitable, taking into consideration, among other things, the nature and type of expense and the relative size of the funds. Federal income taxes The Fund qualifies as a "regulated investment company" by complying with the applicable provisions of the Internal Revenue Code and will not be subject to federal income tax on taxable income that is distributed to shareholders. Therefore, no federal income tax provision is required. Dividends, interest and distributions Dividend income on investment securities is recorded on the ex-dividend date or, in the case of some foreign securities, on the date thereafter when the Fund identifies the dividend. Interest income on investment securities is recorded on the accrual basis. Foreign income may be subject to foreign withholding taxes, which are accrued as applicable. The Fund records distributions from net investment income and net realized gains on the ex-dividend date. During the year ended September 30, 2003 the tax character of distributions paid was as follows: ordinary income $10,682,298. During the year ended September 30, 2004, the tax character of distributions paid was as follows: ordinary income $11,756,027. As of September 30, 2004, the components of distributable earnings on a tax basis included $1,500,578 of undistributed ordinary income. Such distributions and distributable earnings, on a tax basis, are determined in conformity with income tax regulations, which may differ from accounting principles generally accepted in the United States of America. Distributions in excess of tax 16 basis earnings and profits, if any, are reported in the Fund's financial statements as a return of capital. Use of estimates The preparation of these financial statements, in accordance with accounting principles generally accepted in the United States of America, incorporates estimates made by management in determining the reported amount of assets, liabilities, revenues and expenses of the Fund. Actual results could differ from these estimates. Note B Management fee and transactions with affiliates and others The Fund has an investment management contract with John Hancock Advisers, LLC (the "Adviser"), a wholly owned subsidiary of John Hancock Financial Services, Inc. Under the investment management contract, the Fund pays a monthly management fee to the Adviser at an annual rate of 0.50% of the Fund's average weekly net asset value and the value attributable to the Dutch Auction Rate Transferable Securities preferred shares (collectively, "managed assets"), plus 5.00% of the Fund's weekly gross income. The Adviser's total fee is limited to a maximum amount equal to 1.00% annually of the Fund's average weekly managed assets. For the year ended September 30, 2004, the advisory fee incurred did not exceed the maximum advisory fee allowed. The Fund has an administrative agreement with the Adviser under which the Adviser oversees the custodial, auditing, valuation, accounting, legal, stock transfer and dividend disbursing services, and maintains Fund communications with shareholders. The Fund pays the Adviser a monthly administration fee at an annual rate of 0.10% of the Fund's average weekly managed assets. The compensation for the year amounted to $207,188. The Fund also paid the Adviser the amount of $821 for certain publishing services, included in the printing fees. Mr. James A. Shepherdson is a director and/or officer of the Adviser and/or its affiliates, as well as Trustee of the Fund. The compensation of unaffiliated Trustees is borne by the Fund. The unaffiliated Trustees may elect to defer, for tax purposes, their receipt of this compensation under the John Hancock Group of Funds Deferred Compensation Plan. The Fund makes investments into other John Hancock funds, as applicable, to cover its liability for the deferred compensation. Investments to cover the Fund's deferred compensation liability are recorded on the Fund's books as an other asset. The deferred compensation liability and the related other asset are always equal and are marked to market on a periodic basis to reflect any income earned by the investments, as well as any unrealized gains or losses. The Deferred Compensation Plan investments had no impact on the operations of the Fund. 17 Note C Fund share transactions This listing illustrates the Fund's common shares, dividend reinvestments, reclassification of the Fund's capital accounts and the number of common shares outstanding at the beginning and end of the last two periods, along with the corresponding dollar value. Year ended 9-30-03 Year ended 9-30-04 Shares Amount Shares Amount Beginning of period 15,017,782 $141,016,976 15,142,247 $141,943,091 Dividends reinvested 124,465 1,062,637 113,312 1,037,662 Reclassification of capital accounts -- (136,522) -- (83,707) End of period 15,142,247 $141,943,091 15,255,559 $142,897,046 Dutch Auction Rate Transferable Securities preferred shares Series A The Fund issued 685 shares of Dutch Auction Rate Transferable Securities preferred shares Series A ("DARTS") in a public offering. The underwriting discount was recorded as a reduction of the capital of common shares. Dividends on the DARTS, which accrue daily, are cumulative at a rate that was established at the offering of the DARTS and has been reset every 49 days thereafter by an auction. Dividend rates on DARTS ranged from 1.04% to 1.64% during the year ended September 30, 2004. Accrued dividends on DARTS are included in the value of DARTS on the Fund's Statement of Assets and Liabilities. The DARTS are redeemable at the option of the Fund, at a redemption price equal to $100,000 per share, plus accumulated and unpaid dividends on any dividend payment date. The DARTS are also subject to mandatory redemption at a redemption price equal to $100,000 per share, plus accumulated and unpaid dividends, if the Fund is in default on its asset coverage requirements with respect to the DARTS, as defined in the Fund's by-laws. If the dividends on the DARTS shall remain unpaid in an amount equal to two full years' dividends, the holders of the DARTS, as a class, have the right to elect a majority of the Board of Trustees. In general, the holders of the DARTS and the common shareholders have equal voting rights of one vote per share, except that the holders of the DARTS, as a class, vote to elect two members of the Board of Trustees, and separate class votes are required on certain matters that affect the respective interests of the DARTS and common shareholders. Note D Investment transactions Purchases and proceeds from sales or maturities of securities, other than short-term securities and obligations of the U.S. government, during the year ended September 30, 2004, aggregated $36,633,393 and $32,186,090, respectively. The cost of investments owned on September 30, 2004, including short-term investments, for federal income tax purposes, was $212,943,311. Gross unrealized appreciation and depreciation of investments aggregated $17,076,294 and $20,265,329, respectively, resulting in net unrealized depreciation of $3,189,035. The difference between book basis and tax basis net unrealized depreciation of investments is attributable primarily to the tax deferral of losses on certain sales of securities. 18 Note E Reclassification of accounts During the year ended September 30, 2004, the Fund reclassified amounts to reflect a decrease in accumulated net realized loss on investments of $234, an increase in accumulated net investment income of $83,473 and a decrease in capital paid-in of $83,707. This represents the amounts necessary to report these balances on a tax basis, excluding certain temporary differences, as of Septem ber 30, 2004. Additional adjustments may be needed in subsequent reporting periods. These reclassifications, which have no impact on the net asset value of the Fund, are primarily attributable to certain differences in the computation of distributable income and capital gains under federal tax rules versus accounting principles generally accepted in the United States of America, and book and tax differences in accounting for deferred compensation and federal excise tax. The calculation of net investment income per share in the Fund's Financial Highlights excludes these adjustments. 19 AUDITORS' REPORT Report of Deloitte & Touche LLP, Independent Registered Public Accounting Firm To the Board of Trustees and Shareholders of John Hancock Patriot Premium Dividend Fund I, We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of John Hancock Patriot Premium Dividend Fund I (the "Fund") as of September 30, 2004, and the related statement of operations for the year then ended, the statement of changes in net assets for the years ended September 30, 2004 and 2003 and the financial highlights for each of the years in the five-year period ended September 30, 2004. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned at September 30, 2004 by correspondence with the custodian and brokers; where replies were not received from brokers, we performed other auditing procedures. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Fund as of September 30, 2004, the results of its operations, the changes in its net assets and its financial highlights for the respective stated periods in conformity with accounting principles generally accepted in the United States of America. DELOITTE & TOUCHE LLP Boston, Massachusetts November 12, 2004 20 TAX INFORMATION Unaudited For federal income tax purposes, the following information is furnished with respect to the distributions of the Fund, if any, paid during its taxable year ended September 30, 2004. With respect to the ordinary dividends paid by the Fund for the fiscal year ended September 30, 2004, 88.12% of the dividends qualifies for the corporate dividends-received deduction. The Fund hereby designates the maximum amount allowable of its net taxable income as qualified dividend income as provided in the Jobs and Growth Tax Relief Reconciliation Act of 2003. This amount will be reflected on Form 1099-DIV for the calendar year 2004. Shareholders will be mailed a 2004 U.S. Treasury Department Form 1099-DIV in January 2005. This will reflect the total of all distributions that are taxable for calendar year 2004. 21 Investment objective and policy The Fund's investment objective is to provide a high current income consistent with modest growth of capital for holders of its common shares of beneficial interest. The Fund will pursue its objective by investing in a diversified portfolio of dividend-paying preferred and common stocks. The Fund's non-fundamental investment policy with respect to the quality of ratings of its portfolio investments, which was changed by a vote of the Fund's Trustees on September 13, 1994 and became effective October 15, 1994, stipulates that preferred stocks and debt obligations in which the Fund will invest will be rated investment-grade (at least "BBB" by S&P or "Baa" by Moody's) at the time of investment or will be preferred stocks of issuers of investment-grade senior debt, some of which may have speculative characteristics, or, if not rated, will be of comparable quality as determined by the Adviser. The Fund will invest in common stocks of issuers whose senior debt is rated investment-grade or, in the case of issuers that have no rated senior debt outstanding, whose senior debt is considered by the Adviser to be of comparable quality. This revised policy supersedes the requirement that at least 80% of the Fund's total assets consist of preferred stocks and debt obligations rated "A" or higher and dividend-paying common stocks whose issuers have senior debt rated "A" or higher. On November 20, 2001, the Fund's Trustees approved the following investment policy investment restriction change, effective December 15, 2001. Under normal circumstances, the Fund will invest at least 80% of its assets in dividend-paying securities. The "Assets" are defined as net assets including the liquidation preference amount of the DARTS plus borrowings for investment purposes. The Fund will notify shareholders at least 60 days prior to any change in this 80% investment policy. By-laws In November 2002, the Board of Trustees adopted several amendments to the Fund's by-laws, including provisions relating to the calling of a special meeting and requiring advance notice of shareholder proposals or nominees for Trustee. The advance notice provisions in the by-laws require shareholders to notify the Fund in writing of any proposal that they intend to present at an annual meeting of shareholders, including any nominations for Trustee, between 90 and 120 days prior to the first anniversary of the mailing date of the notice from the prior year's annual meeting of shareholders. The notification must be in the form prescribed by the by-laws. The advance notice provisions provide the Fund and its Trustees with the opportunity to thoughtfully consider and address the matters proposed before the Fund prepares and mails its proxy statement to shareholders. Other amendments set forth the procedures that must be followed in order for a shareholder to call a special meeting of shareholders. Please contact the Secretary of the Fund for additional information about the advance notice requirements or the other amendments to the by-laws. On December 16, 2003, the Trustees approved the following change to the Fund's by-laws. The auction preferred section of the Fund's by-laws was changed to update the rating agency requirements, in keeping with recent changes to the agencies' basic maintenance reporting requirements for leveraged closed-end funds. By-laws now require an independent accountant's confirmation only once per year, at the Fund's fiscal year end, and changes to the agencies' basic maintenance reporting requirements that include modifications to 22 the eligible assets and their respective discount factors. These revisions bring the Fund's by-laws in line with current rating agency requirements. On September 14, 2004, the Trustees approved an amendment to the Fund's by-laws increasing the maximum applicable dividend rate ceiling on the preferred shares to conform with the modern calculation methodology used by the industry and other John Hancock funds. Dividend reinvestment plan The Fund offers its shareholders a Dividend Reinvestment Plan (the "Plan"), which offers the opportunity to earn compounded yields. Each holder of common shares will automatically have all distributions of dividends and capital gains reinvested by Mellon Investor Services, as Plan agent for the common shareholders (the "Plan Agent"), unless an election is made to receive cash. Holders of common shares who elect not to participate in the Plan will receive all distributions in cash, paid by check mailed directly to the shareholder of record (or if the common shares are held in street or other nominee name, then to the nominee) by the Plan Agent, as dividend-disbursing agent. Shareholders whose shares are held in the name of a broker or a nominee should contact the broker or nominee to determine whether and how they may participate in the Plan. If the Fund declares a dividend payable either in common shares or in cash, non-participants will receive cash and participants in the Plan will receive the equivalent in common shares. If the market price of the common shares on the payment date of the dividend is equal to or exceeds their net asset value as determined on the payment date, participants will be issued common shares (out of authorized but unissued shares) at a value equal to the higher of net asset value or 95% of the market price. If the net asset value exceeds the market price of the common shares at such time, or if the Board of Trustees declares a dividend payable only in cash, the Plan Agent will, as agent for Plan participants, buy shares in the open market, on the New York Stock Exchange or elsewhere, for the participant's accounts. Such purchases will be made promptly after the payable date for such dividend and, in any event, prior to the next ex-dividend date after such date, except where necessary to comply with federal securities laws. If, before the Plan Agent has completed its purchases, the market price exceeds the net asset value of the common shares, the average per share purchase price paid by the Plan Agent may exceed the net asset value of the common shares, resulting in the acquisition of fewer shares than if the dividend had been paid in shares issued by the Fund. Each participant will pay a pro rata share of brokerage commissions incurred with respect to the Plan Agent's open market purchases in connection with the reinvestment of dividends and distributions. The cost per share of the shares purchased for each participant's account will be the average cost, including brokerage commissions, of any shares purchased on the open market plus the cost of any shares issued by the Fund. There will be no brokerage charges with respect to common shares issued directly by the Fund. There are no other charges to participants for reinvesting dividends or capital gain distributions. Participants in the Plan may withdraw from the Plan at any time by contacting the Plan Agent by telephone, in writing or by visiting the Plan Agent's Web site at www.melloninvestor.com. Such withdrawal will be effective immediately if received prior to a dividend record date; otherwise, it will be effective for all subsequent dividend record dates. When a participant withdraws from the Plan or upon termination of the Plan, as provided below, certificates 23 for whole common shares credited to his or her account under the Plan will be issued and a cash payment will be made for any fraction of a share credited to such account. The Plan Agent maintains each shareholder's account in the Plan and furnishes monthly written confirmations of all transactions in the accounts, including information needed by the shareholders for personal and tax records. The Plan Agent will hold common shares in the account of each Plan participant in non-certificated form in the name of the participant. Proxy material relating to the shareholders' meetings of the Fund will include those shares purchased, as well as shares held pursuant to the Plan. The reinvestment of dividends and distributions will not relieve participants of any federal income tax that may be payable or required to be withheld on such dividends or distributions. Participants under the Plan will receive tax information annually. The amount of dividend to be reported on 1099-DIV should be: (1) in the case of shares issued by the Fund, the fair market value of such shares on the dividend payment date and (2) in the case of shares purchased by the Plan Agent in the open market, the amount of cash used by the Plan Agent to purchase shares in the open market, including the amount of cash allocated to brokerage commissions paid on such purchases. Experience under the Plan may indicate that changes are desirable. Accordingly, the Fund reserves the right to amend or terminate the Plan as applied to any dividend or distribution paid subsequent to written notice of the change sent to all shareholders of the Fund at least 90 days before the record date for the dividend or distribution. The Plan may be amended or terminated by the Plan Agent after at least 90 days' written notice to all shareholders of the Fund. All correspondence or additional information concerning the Plan should be directed to the Plan Agent, Mellon Bank, N.A., c/o Mellon Investor Services, P.O. Box 3338, South Hackensack, NJ 07606-1938 (telephone 1-800-852-0218). Shareholder communication and assistance If you have any questions concerning the Fund, we will be pleased to assist you. If you hold shares in your own name and not with a brokerage firm, please address all notices, correspondence, questions or other communications regarding the Fund to the transfer agent at: Mellon Investor Services 85 Challenger Road Overpeck Centre Ridgefield Park, NJ 07660 Telephone 1-800-852-0218 If your shares are held with a brokerage firm, you should contact that firm, bank or other nominee for assistance. 24 Shareholder meeting On March 18, 2004, the Annual Meeting of the Fund was held to elect three Trustees and to ratify the actions of the Trustees in selecting independent auditors for the Fund. Proxies covering 14,044,515 shares of beneficial interest were voted at the meeting. The common shareholders elected the following Trustees to serve until their respective successors are duly elected and qualified (there were no current nominees for election by the preferred shareholders), with the votes tabulated as follows: WITHHELD FOR AUTHORITY - ------------------------------------------------------------- Patti McGill Peterson 13,833,353 210,665 Steven Pruchansky 13,885,053 158,965 Norman H. Smith 13,856,705 187,313 The common and preferred shareholders also ratified the Trustees' selection of Deloitte & Touche LLP as the Fund's independent auditors for the fiscal year ending September 30, 2004, with the votes tabulated as follows: 13,842,853 FOR, 64,146 AGAINST and 137,516 ABSTAINING. 25 TRUSTEES & OFFICERS This chart provides information about the Trustees and Officers who oversee your John Hancock fund. Officers elected by the Trustees manage the day-to-day operations of the Fund and execute policies formulated by the Trustees. Independent Trustees Name, age Number of Position(s) held with Fund Trustee John Hancock Principal occupation(s) and other of Fund funds overseen directorships during past 5 years since 1 by Trustee Charles L. Ladner,2 Born: 1938 1992 48 Independent Chairman (since 2004); Chairman and Trustee, Dunwoody Village, Inc. (retirement services) (until 2003); Senior Vice President and Chief Financial Officer, UGI Corporation (Public Utility Holding Company) (retired 1998); Vice President and Director for AmeriGas, Inc. (retired 1998); Director of AmeriGas Partners, L.P. (until 1997) (gas distribution); Director, EnergyNorth, Inc. (until 1995); Director, Parks and History Association (since 2001). James F. Carlin, Born: 1940 1988 28 Director and Treasurer, Alpha Analytical Inc. (analytical laboratory) (since 1985); Part Owner and Treasurer, Lawrence Carlin Insurance Agency, Inc. (since 1995); Part Owner and Vice President, Mone Lawrence Carlin Insurance Agency, Inc. (since 1996); Director and Treasurer, Rizzo Associates (until 2000); Chairman and CEO, Carlin Consolidated, Inc. (management/investments) (since 1987); Director and Partner, Proctor Carlin & Co., Inc. (until 1999); Trustee, Massachusetts Health and Education Tax Exempt Trust (since 1993); Director of the following: Uno Restaurant Corp. (until 2001), Arbella Mutual (insurance) (until 2000), HealthPlan Services, Inc. (until 1999), Flagship Healthcare, Inc. (until 1999), Carlin Insurance Agency, Inc. (until 1999); Chairman, Massachusetts Board of Higher Education (until 1999). William H. Cunningham, Born: 1944 1995 28 Former Chancellor, University of Texas System and former President of the University of Texas, Austin, Texas; Chairman and CEO, IBT Technologies (until 2001); Director of the following: The University of Texas Investment Management Company (until 2000), Hire.com (until 2004), STC Broadcasting, Inc. and Sunrise Television Corp. (electronic manufacturing) (until 2001), Symtx, Inc. (since 2001), Adorno/Rogers Technology, Inc. (until 2004), Pinnacle Foods Corporation (until 2003), rateGenius (Internet service) (until 2003), Jefferson-Pilot Corporation (diversified life insurance company) (since 1985), New Century Equity Holdings (formerly Billing Concepts) (until 2001), eCertain (until 2001), ClassMap.com (until 2001), Agile Ventures (until 2001), LBJ Foundation (until 2000), Golfsmith International, Inc. (until 2000), Metamor Worldwide (until 2000), AskRed.com (until 2001), Southwest Airlines (since 2000) and Introgen (since 2000); Advisory Director, 26 Independent Trustees (continued) Name, age Number of Position(s) held with Fund Trustee John Hancock Principal occupation(s) and other of Fund funds overseen directorships during past 5 years since 1 by Trustee William H. Cunningham, Born: 1944 (continued) 1995 28 Q Investments (until 2003); Advisory Director, Chase Bank (formerly Texas Commerce Bank -- Austin) (since 1988), LIN Television (since 2002), WilTel Communications (until 2003) and Hayes Lemmerz International, Inc. (diversified automotive parts supply company) (since 2003). Ronald R. Dion, Born: 1946 1998 28 Chairman and Chief Executive Officer, R.M. Bradley & Co., Inc.; Director, The New England Council and Massachusetts Roundtable; Trustee, North Shore Medical Center; Director, Boston Stock Exchange; Director, BJ's Wholesale Club, Inc. and a corporator of the Eastern Bank; Trustee, Emmanuel College. John A. Moore,2 Born: 1939 2002 30 President and Chief Executive Officer, Institute for Evaluating Health Risks, (nonprofit institution) (until 2001); Chief Scientist, Sciences International (health research) (until 2003); Principal, Hollyhouse (consulting) (since 2000); Director, CIIT (nonprofit research) (since 2002). Patti McGill Peterson,2 Born: 1943 2002 30 Executive Director, Council for International Exchange of Scholars and Vice President, Institute of International Education (since 1998); Senior Fellow, Cornell Institute of Public Affairs, Cornell University (until 1998); Former President of Wells College and St. Lawrence University; Director, Niagara Mohawk Power Corporation (until 2003); Director, Ford Foundation, International Fellowships Program (since 2002); Director, Lois Roth Endowment (since 2002); Director, Council for International Educational Exchange (since 2003). Steven Pruchansky, Born: 1944 1992 28 Chairman and Chief Executive Officer, Greenscapes of Southwest Florida, Inc. (since 2000); Director and President, Greenscapes of Southwest Florida, Inc. (until 2000); Managing Director, JonJames, LLC (real estate) (since 2001); Director, First Signature Bank & Trust Company (until 1991); Director, Mast Realty Trust (until 1994); President, Maxwell Building Corp. (until 1991). Norman H. Smith, Born: 1933 1992 28 Lieutenant General, United States Marine Corps; Deputy Chief of Staff for Manpower and Reserve Affairs, Headquarters Marine Corps; Commanding General III Marine Expeditionary Force/3rd Marine Division (retired 1991). John P. Toolan,2 Born: 1930 1993 28 Director, The Smith Barney Muni Bond Funds, The Smith Barney Tax-Free Money Funds, Inc., Vantage Money Market Funds (mutual funds), The Inefficient-Market Fund, Inc. (closed-end investment company); Chairman, Smith Barney Trust Company of Florida (retired 1991); Director, Smith Barney, Inc., Mutual Management Company and Smith Barney Advisers, Inc. (investment advisers) (retired 1991); Senior Executive Vice President, Director and member of the Executive Committee, Smith Barney, Harris Upham & Co., Incorporated (investment bankers) (until 1991). 27 Non-Independent Trustees 3 Name, age Number of Position(s) held with Fund Trustee John Hancock Principal occupation(s) and other of Fund funds overseen directorships during past 5 years since 1 by Trustee James A. Shepherdson, Born: 1952 2004 48 President and Chief Executive Officer Executive Vice President, Manulife Financial Corporation; Chairman, Director, President and Chief Executive Officer, John Hancock Advisers, LLC and The Berkeley Group; Chairman, Director, President and Chief Executive Officer, John Hancock Funds, LLC; Chairman, President, Director and Chief Executive Officer, Sovereign Asset Management Corporation ("SAMCorp"); President, John Hancock Retirement Services, John Hancock Life Insurance Company (until 2004); Chairman, Essex Corporation (until 2004); Co-Chief Executive Officer, MetLife Investors Group (until 2003); Senior Vice President, AXA/Equitable Insurance Company (until 2000). Principal officers who are not Trustees Name, age Position(s) held with Fund Officer Principal occupation(s) and of Fund directorships during past 5 years since William H. King, Born: 1952 1992 Vice President and Treasurer Vice President and Assistant Treasurer, the Adviser; Vice President and Treasurer of each of the John Hancock funds; Assistant Treasurer of each of the John Hancock funds (until 2001). Susan S. Newton, Born: 1950 1992 Senior Vice President, Secretary and Chief Legal Officer Senior Vice President, Secretary and Chief Legal Officer, SAMCorp., the Adviser and each of the John Hancock funds, John Hancock Funds and The Berkeley Group; Vice President, Signature Services (until 2000); Director, Senior Vice President and Secretary, NM Capital. The business address for all Trustees and Officers is 101 Huntington Avenue, Boston, Massachusetts 02199. The Statement of Additional Information of the Fund includes additional information about members of the Board of Trustees of the Fund and is available, without charge, upon request, by calling 1-800-225-5291. 1 Each Trustee serves until resignation, retirement age or until his or her successor is elected. 2 Member of Audit Committee. 3 Non-independent Trustees hold positions with the Fund's investment adviser, underwriter and certain other affiliates. 28 For more information The Fund's proxy voting policies, procedures and records are available without charge, upon request: By phone On the Fund's Web site On the SEC's Web site 1-800-225-5291 www.jhfunds.com/proxy www.sec.gov Investment adviser John Hancock Advisers, LLC 101 Huntington Avenue Boston, MA 02199-7603 Custodian The Bank of New York One Wall Street New York, NY 10286 Transfer agent and dividend disburser Mellon Investor Services 85 Challenger Road Overpeck Centre Ridgefield Park, NJ 07660 Transfer agent for DARTS Deutsche Bank Trust Company Americas 280 Park Avenue New York, NY 10017 Legal counsel Wilmer Cutler Pickering Hale and Dorr LLP 60 State Street Boston, MA 02109-1803 Independent registered public accounting firm Deloitte & Touche LLP 200 Berkeley Street Boston, MA 02116-5022 Stock symbol Listed New York Stock Exchange: PDF For shareholder assistance refer to page 24 How to contact us Internet www.jhfunds.com Mail Regular mail: Mellon Investor Services 85 Challenger Road Overpeck Centre Ridgefield Park, NJ 07660 Phone Customer service representatives 1-800-852-0218 Portfolio commentary 1-800-344-7054 24-hour automated information 1-800-843-0090 TDD line 1-800-231-5469 A listing of month-end portfolio holdings is available on our Web site, www.jhfunds.com. A more detailed portfolio holdings summary is available on a quarterly basis 60 days after the fiscal quarte r on our Web site or upon request by calling 1-800-225-5291, or on the Securities and Exchange Commission's Web site, www.sec.gov. 29 [A 1 1/2" x 1/2" John Hancock (Signature) logo in upper left hand corner. A tag line below reads "JOHN HANCOCK FUNDS."] 1-800-852-0218 1-800-843-0090 EASI-Line 1-800-231-5469 (TDD) www.jhfunds.com PRESORTED STANDARD U. S. POSTAGE PAID MIS P100A 9/04 11/04 ITEM 2. CODE OF ETHICS. As of the end of the period, September 30, 2004, the registrant has adopted a code of ethics, as defined in Item 2 of Form N-CSR, that applies to its Chief Executive Officer, Chief Financial Officer and Treasurer (respectively, the principal executive officer, the principal financial officer and the principal accounting officer, the "Senior Financial Officers"). A copy of the code of ethics is filed as an exhibit to this Form N-CSR. ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT. Charles L. Ladner is the audit committee financial expert and is "independent", pursuant to general instructions on Form N-CSR Item 3. ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. (a) Audit Fees The aggregate fees billed for professional services rendered by the principal accountant(s) for the audit of the registrant's annual financial statements or services that are normally provided by the accountant(s) in connection with statutory and regulatory filings or engagements amounted to $29,750 for the fiscal year ended September 30, 2003 and $31,250 for the fiscal year ended September 30, 2004. These fees were billed to the registrant and were approved by the registrant's audit committee. (b) Audit-Related Services There were no audit-related fees during the fiscal year ended September 30, 2003 and fiscal year ended September 30, 2004 billed to the registrant or 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 ("control affiliates"). (c) Tax Fees The aggregate fees billed for professional services rendered by the principal accountant(s) for the tax compliance, tax advice and tax planning ("tax fees") amounted to $2,100 for the fiscal year ended September 30, 2003 and $2,250 for the fiscal year ended September 30, 2004. The nature of the services comprising the tax fees was the review of the registrant's income tax returns and tax distribution requirements. These fees were billed to the registrant and were approved by the registrant's audit committee. There were no tax fees billed to the control affiliates. (d) All Other Fees The all other fees billed to the registrant for products and services provided by the principal accountant were $21,700 for the fiscal year ended September 30, 2003 and $4,000 for the fiscal year ended September 30, 2004. There were no other fees during the fiscal year ended September 30, 2003 and September 30, 2004 billed to control affiliates for products and services provided by the principal accountant. The nature of the services comprising the all other fees was related to the principal accountant's report on the registrant's Eligible Asset Coverage. These fees were approved by the registrant's audit committee. (e) (1) See attachment "Approval of Audit, Audit-related, Tax and Other Services", with the audit committee pre-approval policies and procedures. (e)(2) There were no fees that were approved by the audit committee pursuant to the de minimis exception for the fiscal years ended September 30, 2003 and September 30, 2004 on behalf of the registrant or on behalf of the control affiliates that relate directly to the operations and financial reporting of the registrant. (f) According to the registrant's principal accountant, for the fiscal year ended September 30, 2004, the percentage of hours spent on the audit of the registrant's financial statements for the most recent fiscal year that were attributed to work performed by persons who were not full-time, permanent employees of principal accountant was less than 50%. (g) The aggregate non-audit fees billed by the registrant's accountant(s) for services rendered to the registrant and rendered to the registrant's control affiliates for each of the last two fiscal years of the registrant were $149,700 for the fiscal year ended September 30, 2003, and $2,250 for the fiscal year ended September 30, 2004. (h) The audit committee of the registrant has considered the non-audit services provided by the registrant's principal accountant(s) to the control affiliates and has determined that the services that were not pre-approved are compatible with maintaining the principal accountant(s)' independence. ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS. The registrant has a separately-designated standing audit committee comprised of independent trustees. The members of the audit committee are as follows: Charles L. Ladner Dr. John A. Moore Patti McGill Peterson John P. Toolan ITEM 6. SCHEDULE OF INVESTMENTS. Not applicable. ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. See attached Exhibit "Proxy Voting Policies and Procedures". ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS. Not applicable. ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. (a) There were no material changes to previously disclosed John Hancock Funds - Administration Committee Charter. ITEM 10. CONTROLS AND PROCEDURES. (a) Based upon their evaluation of the registrant's disclosure controls and procedures as conducted within 90 days of the filing date of this Form N-CSR, the registrant's principal executive officer and principal accounting officer have concluded that those disclosure controls and procedures provide reasonable assurance that the material information required to be disclosed by the registrant on this report is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms. (b) There were no changes in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting. ITEM 11. EXHIBITS. (a)(1) Code of Ethics for Senior Financial Officers is attached. (a)(2) Separate certifications for the registrant's principal executive officer and principal accounting officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002 and Rule 30a-2(a) under the Investment Company Act of 1940, are attached. (b)(1) Separate certifications for the registrant's principal executive officer and principal accounting officer, as required by 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and Rule 30a-2(b) under the Investment Company Act of 1940, are attached. The certifications furnished pursuant to this paragraph are not deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that section. Such certifications are not deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that the Registrant specifically incorporates them by reference. (c)(1) Proxy Voting Policies and Procedures are attached. (c)(2) Approval of Audit, Audit-related, Tax and Other Services is attached. (c)(3) Contact person at the registrant. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. John Hancock Patriot Premium Dividend Fund I By: ------------------------------ James A. Shepherdson President and Chief Executive Officer Date: November 23, 2004 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By: ------------------------------ James A. Shepherdson President and Chief Executive Officer Date: November 23, 2004 By: ------------------------------ William H. King Vice President and Treasurer Date: November 23, 2004