UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------
FORM N-CSR
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CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
INVESTMENT COMPANY ACT FILE NUMBER 811-8689
THE NEVIS FUND, INC.
(Exact name of registrant as specified in charter)
--------
1119 St. Paul Street
Baltimore, MD 21202
(Address of principal executive offices) (Zip code)
SEI Investments
One Freedom Valley Drive
Oaks, PA 19456
(Name and address of agent for service)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: 1-877-44-NEVIS
DATE OF FISCAL YEAR END: MAY 31, 2005
DATE OF REPORTING PERIOD: MAY 31, 2005
ITEM 1. REPORTS TO STOCKHOLDERS.
THE NEVIS FUND, INC.
Supplement dated August 10, 2005 to the
Annual Report dated May 31, 2005
THIS SUPPLEMENT PROVIDES NEW AND ADDITIONAL INFORMATION THAT REPLACES
INFORMATION CONTAINED IN THE ANNUAL REPORT AND SHOULD BE READ IN CONJUNCTION
WITH THE ANNUAL REPORT.
The following paragraph should replace the first paragraph under the heading
"Manager's Discussion and Analysis of Fund Performance" on page 2 of the Annual
report:
The Nevis Fund (the "Fund") started fiscal year 2005 with 20 equity
holdings and ended with 19. During fiscal year 2005 we sold the
following five holdings in their entirety that the Fund had held as of
May 31, 2004: Aspect Telecom, Aspen Technology, Bentley
Pharmaceuticals, Ionics, and Vicor. We sold partial amounts from the
positions in companies that we either held in the Fund last year or
purchased during the year and continue to hold in the Fund, including:
Armor Holdings, Central Garden & Pet, Costar Group, Connetics, Davita,
FLIR Systems, Providian Financial, Scientific Games, Symyx
Technologies, and Wind River Systems.
PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE.
NEV-SK-004-0100
[Nevis Logo Omitted]
The Nevis Fund, Inc.
ANNUAL REPORT TO SHAREHOLDERS
MAY 31, 2005
TABLE OF CONTENTS
Letter to Shareholders .................................................... 1
Manager's Discussion and Analysis of Fund Performance ..................... 2
Statement of Net Assets ................................................... 4
Statement of Operations ................................................... 6
Statement of Changes in Net Assets ........................................ 7
Financial Highlights ...................................................... 8
Notes to Financial Statements ............................................. 9
Report of Independent Registered Public Accounting Firm ................... 12
Directors and Officers of the Nevis Fund (Unaudited) ...................... 13
Disclosure of Fund Expenses (Unaudited) ................................... 15
Approval of Investment Advisory Agreements (Unaudited) .................... 16
A description of the policies and procedures that the Fund uses to determine how
to vote proxies relating to the Fund's portfolio securities, as well as
information relating to how the Fund voted proxies relating to portfolio
securities during the most recent 12-month period ended June 30 is available (i)
without charge, upon request, by calling 1-877-44-NEVIS; and (ii) on the U.S.
Securities and Exchange Commission's website at http://www.sec.gov.
The Fund files its complete schedule of portfolio holdings with the Securities
and Exchange Commission for the first and third quarters of each fiscal year on
Form N-Q within sixty days after the end of the period. The Fund's Forms N-Q are
available on the Commission's website at HTTP://WWW.SEC.GOV, and may be reviewed
and copied at the Commission's Public Reference Room in Washington, DC.
Information on the operation of the Public Reference Room may be obtained by
calling 1-800-SEC-0330.
<page>
LETTER TO SHAREHOLDERS THE NEVIS FUND, INC.
June 30, 2005
Dear Fellow Shareholder:
The Nevis Fund's (the "Fund") Net Asset Value (NAV) on May 31, 2005 was $12.39,
down 0.80% from the May 31, 2004 NAV of $12.49. This compares to the S&P 500
Index which increased 8.20% and the Russell 2000 Index which increased 9.90%
over the same period.
Two significant events in the U.S. economy over the past year have been the
Federal Reserve's (the "Fed") tightening stance toward interest rates, and the
escalating price of crude oil. The Federal Reserve Board has increased its base
lending rate by 0.25% at each of its last nine meetings. The Fed funds rate was
1.00% in June of 2004--today the rate is 3.25%. Meanwhile, the price of crude
oil is hitting new all-time high prices, having just risen to over $60 per
barrel. On the surface, both of these events would appear to be negative for the
stock market. Higher interest rates usually translate into lower earnings
multiples for equities; and higher oil prices often spark renewed inflation
fears and can be a drag on economic growth.
Despite these two phenomena, the U.S. equity market continues to exhibit signs
of strength. Investors appear confident that higher near term interest rates and
the recent surge in the price of oil won't hinder economic growth. In the period
since June 2004 up until today, June 30, 2005, the S&P 500 Index has risen
approximately 7.00%. So if the stock market is concerned about rising interest
rates and oil prices, these concerns do not appear to be reflected in recent
stock market action. Supporting the rise in the S&P 500 Index is the underlying
growth in the operating earnings of the Index's composite companies. The
composite operating earnings of the S&P 500 Index grew 23.70% in 2004 over 2003;
and they are projected to grow 10.90% in 2005 over 2004. If the recent stock
market results are an indicator of future economic activity, then it seems to be
signaling that the rise in interest rates and the price of oil might be nearing
an end.
At the core of our investment strategy is the belief that over time there is a
direct correlation between a company's stock price and that company's potential
ability to generate free cash flow. We believe that low interest rates and low
inflation combined with moderate GDP growth creates a favorable environment for
small-to-mid cap growth stocks. In this setting, real, sustainable growth should
receive a premium multiple as investors seek out investments with cash flows
that have the potential to grow at above average rates.
To this end, we are focused on the growth prospects of our individual holdings;
more specifically, at what rate we expect revenues and earnings might increase
over the next 18-24 months; and where a company's stock could potentially sell,
given its prospects. We are encouraged by the recent quarterly earnings reports
from the Fund's equity holdings.
Please be aware that, unlike other mutual funds, the Fund owns only a limited
number of companies. On May 31, 2005, the Fund owned only 19 positions, with the
top 10 representing over 63% of the Fund's assets. This level of concentration
means that the Fund will likely be more volatile than the major indices.
Moreover, in the short-term, especially during periods of market uncertainty,
our holdings tend to fall more than the indices due in part to inefficiencies
related to lower liquidity.
Thank you for your support.
Sincerely,
/s/ David R. Wilmerding, III /s/ Jon C. Baker
David R. Wilmerding, III Jon C. Baker
Co-Manager Co-Manager
*PLEASE CONSIDER THE INVESTMENT OBJECTIVES, RISKS, CHARGES AND EXPENSES OF THE
FUND CAREFULLY BEFORE INVESTING. CONTACT YOUR FINANCIAL ADVISER OR CALL THE FUND
AT 1-877-446-3847 FOR A PROSPECTUS. READ THE PROSPECTUS CAREFULLY BEFORE YOU
INVEST.
1
<page>
MANAGER'S DISCUSSION AND ANALYSIS OF FUND PERFORMANCE
Annual May 31, 2005
The Nevis Fund (the "Fund") started fiscal year 2005 with 20 equity holdings and
ended with 19. During fiscal year 2005 we sold the following five holdings in
their entirety that the Fund had held as of May 31, 2004: Aspect Telecom, Aspen
Technology, Bentley Pharmaceuticals, Ionics, and Vicor. We sold partial amounts
from the positions in companies that we either held in the Fund last year or
purchased during the year and continue to hold in the Fund, including: Armor
Holdings, Central Garden & Pet, Costar Group, Connetics, Davita, FLIR Systems,
Ionics, Providian Financial, Scientific Games, Symyx Technologies, and Wind
River Systems.
During the course of the fiscal year we made net purchases of four new holdings:
Nautilus, Salix Pharmaceuticals, Symyx Technologies, and United Surgical
Partners.
The Fund's Net Asset Value (NAV) decreased from $12.49 per share on May 31, 2004
to $12.39 per share on May 31, 2005, a decrease of 0.80%. This return compares
to an increase of 9.90% for the Russell 2000 Index and an increase of 4.70% for
the Nasdaq Composite Index, and an increase of 8.20% for the S&P 500 Index. THE
PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND THE INVESTMENT RETURN
AND PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE SO THAT AN INVESTOR'S
SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THE ORIGINAL COST. PLEASE
REMEMBER THAT PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS AND CURRENT
PERFORMANCE MAY BE HIGHER OR LOWER THAN THE PERFORMANCE DATA QUOTED. TO OBTAIN
MORE CURRENT PERFORMANCE INFORMATION, PLEASE CALL 1-877-446-3847.
The top five companies contributing negatively to the Fund's performance as
measured on the basis of realized and unrealized losses for the period were
Authentidate, Bentley Pharmaceuticals, Opsware, Vicor, and Autobytel. The top
five companies contributing positively to the Fund's performance as measured on
the basis of realized and unrealized gains for the period were Ionics, Wind
River Systems, Davita, Scientific Games, and Nautilus.
Two companies held in the Fund received buyout offers during the fiscal year and
both were accepted and agreed to by their respective Board of Directors. These
companies were Ionics, which was acquired by General Electric; and Providian
Financial, which has agreed to be acquired by Washington Mutual. The Ionics
transaction closed in February and the Providian transaction is expected to
close by calendar year end, 2005.
THE FUND'S CONCENTRATED POSITIONS OFTEN TRANSLATE INTO HIGHER INDUSTRY
WEIGHTINGS THAN INDICES TYPICALLY HAVE, THEREBY RESULTING IN RETURNS THAT
DEVIATE FROM THE INDICES.
As of May 31, 2005, the Fund had $31,674 in unrealized losses (000) and $96,029
in accumulated tax loss carry forwards (000).
*PLEASE CONSIDER THE INVESTMENT OBJECTIVES, RISKS, CHARGES AND EXPENSES OF THE
FUND CAREFULLY BEFORE INVESTING. CONTACT YOUR FINANCIAL ADVISER OR CALL THE FUND
AT 1-877-446-3847 FOR A PROSPECTUS. READ THE PROSPECTUS CAREFULLY BEFORE YOU
INVEST.
2
<page>
COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT IN
THE NEVIS FUND, INC., VERSUS THE RUSSELL 2000 INDEX
- --------------------------------------------------------
Total Return1
- --------------------------------------------------------
Annualized Annualized Annualized Cumulative
One Year 3 Year 5 Year Inception Inception
Return Return Return to Date 2 to Date 2
- --------------------------------------------------------
-0.80% 6.70% -16.75% 4.46% 35.26% The Nevis Fund, Inc.
- --------------------------------------------------------
9.82% 9.52% 6.68% 5.77% 47.46% Russell 2000 Index
[Line Graph Omitted]
Plot points follow:
The Nevis Fund Russell 2000 Index
6/30/98 10,000 10,000
May 99 19,010 9,711
May 00 33,821 10,673
May 01 20,327 11,280
May 02 11,135 11,224
May 03 10,753 10,306
May 04 13,635 13,427
May 05 13,526 14,746
1 These figures represent past performance as of May 31, 2005. Past performance
is no guarantee of future results. The investment return and principal value
of an investment will fluctuate, so an investor's shares, when redeemed, may
be worth more or less than their original cost. The performance in the above
table does not reflect the deduction of taxes the shareholder would pay on
Fund distributions or redemption of Fund shares. There are specific risks,
including increased volatility and above average price fluctuations, inherent
in investing in technology, science and small capitalized companies. For the
fiscal periods ended May 31, 1999 and May 31, 2000, the Fund benefitted
substantially from first-day realized and unrealized gains from initial public
offerings. These gains were particularly noteworthy given the Fund's
relatively small asset base during portions of these periods. It is unlikely
that the Fund will benefit to the same extent from these types of gains in the
future, especially if Fund assets remain at current levels or if they
increase. The Russell 2000 Index consists of the smallest 2,000 companies in a
group of 3,000 U.S. companies in the Russell 3000 Index, as ranked by market
capitalization.
2 The Nevis Fund commenced operations on June 29, 1998.
3
<page>
STATEMENT OF NET ASSETS THE NEVIS FUND, INC.
May 31, 2005
[Bar Chart Omitted]
Plot points follow:
Sector Weightings (Unaudited)+:
13.7% Consumer Products
11.1% Services-Prepackaged Software
9.0% Medical Products & Services
8.3% Services-Computer Programming Services
7.7% Entertainment
7.5% Services-Business Services
7.4% Information Retrieval Services
6.9% Measuring Devices
5.9% Biological Products
4.8% Financial Services
4.7% Aerospace & Defense
4.7% Chemicals
3.8% Drugs
2.6% Money Market Fund
1.9% Computers & Services
+ Percentages are based on total investments.
Market
Value
Shares ($ Thousands)
----------- -------------
COMMON STOCK 97.6%
AEROSPACE & DEFENSE 4.7%
Armor Holdings* 25,700 $ 970
- --------------------------------------------------------------------------------------------
BIOLOGICAL PRODUCTS 5.9%
Connetics* 54,550 1,215
- --------------------------------------------------------------------------------------------
CHEMICALS 4.7%
Symyx Technologies* 37,887 965
- --------------------------------------------------------------------------------------------
COMPUTERS & SERVICES 1.9%
Authentidate Holding* 132,823 391
- --------------------------------------------------------------------------------------------
CONSUMER PRODUCTS 13.7%
Central Garden & Pet* 34,528 1,531
Nautilus Group 47,304 1,267
- --------------------------------------------------------------------------------------------
2,798
- --------------------------------------------------------------------------------------------
DRUGS 3.8%
Salix Pharmaceuticals* 44,652 782
- --------------------------------------------------------------------------------------------
ENTERTAINMENT 7.7%
Scientific Games, Cl A* 65,979 1,572
- --------------------------------------------------------------------------------------------
FINANCIAL SERVICES 4.8%
Providian Financial* 55,072 981
- --------------------------------------------------------------------------------------------
INFORMATION RETRIEVAL SERVICES 7.4%
Autobytel* 106,971 520
CoStar Group* 24,456 983
- --------------------------------------------------------------------------------------------
1,503
- --------------------------------------------------------------------------------------------
MEASURING DEVICES 6.9%
FLIR Systems* 52,848 1,416
- --------------------------------------------------------------------------------------------
MEDICAL PRODUCTS & SERVICES 9.1%
DaVita* 21,076 971
United Surgical Partners International* 18,184 875
- --------------------------------------------------------------------------------------------
1,846
- --------------------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements.
4
<page>
STATEMENT OF NET ASSETS (CONCLUDED) THE NEVIS FUND, INC.
May 31, 2005
Market
Value
Shares ($ Thousands)
----------- -------------
SERVICES-BUSINESS SERVICES 7.5%
Gevity HR 37,185 $ 638
Opsware* 180,078 895
- --------------------------------------------------------------------------------------------
1,533
- --------------------------------------------------------------------------------------------
SERVICES-COMPUTER PROGRAMMING SERVICES 8.3%
Wind River Systems* 103,248 1,692
- --------------------------------------------------------------------------------------------
SERVICES-PREPACKAGED SOFTWARE 11.2%
Art Technology Group* 875,159 945
Mapinfo* 107,107 1,335
- --------------------------------------------------------------------------------------------
2,280
- --------------------------------------------------------------------------------------------
TOTAL COMMON STOCK
(Cost $51,618) 19,944
============================================================================================
MONEY MARKET FUND 2.6%
SEI Daily Income Trust, Prime Obligation Fund, Cl A 535,036 535
- --------------------------------------------------------------------------------------------
TOTAL MONEY MARKET FUND
(Cost $535) 535
============================================================================================
TOTAL INVESTMENTS 100.2%
(Cost $52,153) 20,479
============================================================================================
OTHER ASSETS AND LIABILITIES (0.2)%
Investment Advisory Fees Payable (31)
Payable for Fund Shares Redeemed (11)
Other Assets and Liabilities, Net 5
- --------------------------------------------------------------------------------------------
TOTAL OTHER ASSETS AND LIABILITIES (37)
============================================================================================
NET ASSETS -- 100.0% $ 20,442
============================================================================================
NET ASSETS:
Paid-in-Capital (unlimited authorization -- no par value)
based on 1,649,983 outstanding shares of beneficial interest $ 148,865
Accumulated net realized loss on investments (96,749)
Net unrealized depreciation on investments (31,674)
- --------------------------------------------------------------------------------------------
NET ASSETS $ 20,442
============================================================================================
Net Asset Value, Offering and Redemption Price Per Share $ 12.39
============================================================================================
* Non-Income producing security
Cl -- Class
The accompanying notes are an integral part of the financial statements.
5
<page>
STATEMENT OF OPERATIONS THE NEVIS FUND, INC.
For the year ended May 31, 2005
($ Thousands)
- --------------------------------------------------------------------------------
INVESTMENT INCOME:
- --------------------------------------------------------------------------------
Dividend Income $ 37
Interest Income 9
- --------------------------------------------------------------------------------
Total Investment Income 46
- --------------------------------------------------------------------------------
EXPENSES:
Investment Advisory Fees (See Note 4) 366
- --------------------------------------------------------------------------------
Total Expenses 366
- --------------------------------------------------------------------------------
Net Investment Loss (320)
- --------------------------------------------------------------------------------
Net Realized Loss on Investments (1,170)
Net Change in Unrealized Depreciation on Investments 1,130
- --------------------------------------------------------------------------------
Net Realized and Unrealized Loss on Investments (40)
- --------------------------------------------------------------------------------
Net Decrease in Net Assets Resulting from Operations $(360)
================================================================================
The accompanying notes are an integral part of the financial statements.
6
<page>
STATEMENT OF CHANGES IN NET ASSETS THE NEVIS FUND, INC.
For the years ended May 31,
- -----------------------------------------------------------------------------------------------------------------
2005 2004
($ Thousands) ($ Thousands)
--------------- ---------------
OPERATIONS:
Net Investment Loss $ (320) $ (518)
Net Realized Loss on Investments (1,170) (3,589)
Net Change in Unrealized Depreciation on Investments 1,130 12,303
- -----------------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting From Operations (360) 8,196
- -----------------------------------------------------------------------------------------------------------------
SHARES TRANSACTIONS:
Proceeds from Shares Issued 289 4,912
Redemption Fees (See Note 7) 1 50
Cost of Shares Repurchased (9,235) (15,059)
- -----------------------------------------------------------------------------------------------------------------
Decrease in Net Assets from Capital Share Transactions (8,945) (10,097)
- -----------------------------------------------------------------------------------------------------------------
TOTAL DECREASE IN NET ASSETS (9,305) (1,901)
- -----------------------------------------------------------------------------------------------------------------
NET ASSETS:
Beginning of Year 29,747 31,648
- -----------------------------------------------------------------------------------------------------------------
NET ASSETS:
End of Year $20,442 $29,747
=================================================================================================================
CAPITAL SHARE TRANSACTIONS:
Shares Issued 23 387
Shares Redeemed (755) (1,216)
=================================================================================================================
NET DECREASE IN SHARES FROM CAPITAL SHARE TRANSACTIONS (732) (829)
=================================================================================================================
The accompanying notes are an integral part of the financial statements.
7
<page>
FINANCIAL HIGHLIGHTS THE NEVIS FUND, INC.
For a share outstanding throughout each year
For the years ended May 31,
Realized Ratio
Net and Net Net of Net
Asset Unrealized Asset Assets Ratio Investment
Value Net Gains (Losses) Total from Value End of Expenses Loss Portfolio
Beginning Investment on Investment End Total of Year to Average to Average Turnover
of Year Loss Securities* Operations of Year Return+ ($ Thousands) Net Assets Net Assets Rate
================================================================================================================================
2005 $12.49 $(0.16)(2) $ 0.06(1) $(0.10) $12.39 (0.80)% $20,442 1.50% (1.31)% 15.96%
2004 9.85 (0.22) 2.86 2.64 12.49 26.80 29,747 1.50 (1.48) 61.35
2003 10.20 (0.11) (0.24) (0.35) 9.85 (3.43) 31,648 1.50 (1.43) 51.24
2002 18.62 (0.32) (8.10) (8.42) 10.20 (45.22) 36,632 1.50 (1.33) 26.20
2001 30.98 (0.31) (12.05) (12.36) 18.62 (39.90) 80,011 1.50 (1.45) 21.86
- --------------------------------------------------------------------------------------------------------------------------------
* INCLUDES REDEMPTION FEES RETAINED BY THE FUND. SUCH REDEMPTION FEES REPRESENT LESS THAN $0.01 PER SHARE.
+ RETURNS DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND
SHARES.
(1) THE AMOUNT SHOWN FOR THE YEAR ENDED MAY 31, 2005 FOR A SHARE OUTSTANDING THROUGHOUT THE YEAR DOES NOT ACCORD WITH THE
AGGREGATE NET LOSSES ON INVESTMENTS FOR THAT YEAR BECAUSE OF THE SALES AND REPURCHASES OF FUND SHARES IN RELATION TO
FLUCTUATING MARKET VALUE OF THE INVESTMENTS OF THE FUND.
(2) CALCULATED USING THE AVERAGE SHARES METHOD.
The accompanying notes are an integral part of the financial statements.
8
<page>
NOTES TO FINANCIAL STATEMENTS THE NEVIS FUND, INC.
May 31, 2005
1. ORGANIZATION:
THE NEVIS FUND, INC. (the "Fund") was incorporated in Maryland on February 20,
1998. The Fund is registered under the Investment Company Act of 1940, as
amended, as a non-diversified open-end management investment company. The Fund's
prospectus provides a description of the Fund's investment goals and strategies.
2. SIGNIFICANT ACCOUNTING POLICIES:
The following is a summary of the significant accounting policies followed by
the Fund.
USE OF ESTIMATES -- The preparation of financial statements in conformity
with accounting principles generally accepted in the United States of
America, requires management to make estimates and assumptions that affect
the reported amount of assets and liabilities and disclosure of contingent
assets and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates.
SECURITY VALUATION -- Securities listed on a securities exchange, and for
which quotations are readily available, are valued at the last quoted sale
price on the principal exchange or market (foreign or domestic) on which they
are traded on valuation date, or, if there is no such reported sale on the
valuation date, at the most recent quoted bid price. Securities that are
quoted on the NASDAQ national market system are valued at the official
closing price. Short term investments that have remaining maturities of sixty
days or less at the time of purchase are valued at amortized cost, which
approximates market value. Securities and other assets for which market
quotations are not readily available (which may include certain restricted
securities which are subject to limitations as to their sale), or securities
for which market quotations are not reliable, are valued at their fair values
as determined in good faith by or under the supervision of the Fund's Board
of Directors (the "Board"), in accordance with methods that are specifically
authorized by the Board. In determining fair value, the Board considers all
relevant qualitative and quantitative information available. These factors
are subject to change over time and are reviewed periodically. The values
assigned to fair value investments are based on available information and do
not necessarily represent amounts that might ultimately be realized. If a
significant event which is likely to impact the value of one or more
securities held by the Fund occurs after the time at which the market for
such security(ies) closes but before the time that the Fund's net asset value
is calculated on any business day, such event may be taken into account in
determining the fair value of such security(ies) at the time the Fund
calculates its net asset value. For these purposes, significant events after
the close of trading may include, among others, securities trading in other
markets, corporate announcements, natural and other disasters, and political
and other events. Further, because of the inherent uncertainty of valuation,
those estimated values may differ significantly from the values that would
have been used had a ready market for the investments existed, and the
differences could be material. At May 31, 2005, no securities were fair
valued.
FEDERAL INCOME TAXES -- It is the Fund's intention to continue to qualify as
a regulated investment company. The Fund's policy is to comply with the
requirements of Subchapter M of the Internal Revenue Code and to distribute
all of its taxable income and net capital gains to its shareholders.
Accordingly, no provision for federal income or excise taxes is required.
SECURITY TRANSACTIONS AND RELATED INCOME -- Security transactions are
accounted for on the date the security is purchased or sold (trade date).
Costs used in determining realized gains and losses on the sales of
investment securities are based on the specific identification method.
Interest income is recognized on the accrual basis. Dividend income is
recorded on the ex-date.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS -- Dividends from net investment
income are declared and paid to shareholders annually. Any net realized
capital gains are distributed to shareholders at least annually.
3. TRANSACTIONS WITH AFFILIATES:
Certain officers of the Fund are also officers of SEI Investment Global Funds
Services (the "Administrator") and/or SEI Investments Distribution Co. (the
"Distributor"). Such officers are paid no fees by the Fund for serving as
officers of the Fund.
4. INVESTMENT MANAGEMENT ARRANGEMENTS:
The Fund and Nevis Capital Management LLC (the "Adviser") are parties to an
Investment Management Agreement under which the Adviser receives an annual fee
equal to 1.50% of the Fund's average daily net assets. Pursuant to its
Investment Management Agreement with the Fund, the Adviser will only pay
ordinary expenses incurred in the conduct of the Fund's operations. The Fund
will bear any extraordinary expenses incurred in the course of its business. For
purposes of the investment management agreement, commissions related to the
Fund's portfolio transactions are not considered operating expenses, but are
instead considered "investment" expenses and will, therefore, be paid by the
Fund.
5. ADMINISTRATION, TRANSFER AGENCY AND SERVICES, CUSTODIAN AND DISTRIBUTION
AGREEMENTS:
As discussed above, the Adviser has agreed to bear all ordinary expenses
incurred in the conduct of the Fund's operations. This includes the following
contractual relationships: The Fund and the Administrator are parties to an
Administration Agreement under which the Administrator provides administrative
services for an annual fee, computed daily and paid monthly, at the annual rate
of 0.12% of the first $100 million of the Fund's average daily net assets, 0.10%
of the next $100 million
9
<page>
NOTES TO FINANCIAL STATEMENTS (CONTINUED) THE NEVIS FUND, INC.
May 31, 2005
of such assets, and 0.08% of such assets in excess of $200 million subject to a
minimum annual fee of $120,000. For the year ended May 31, 2005, the
Administrator received $119,997.
Forum Shareholder Services, LLC serves as the transfer agent and dividend
disbursing agent for the Fund under a Transfer Agency and Services Agreement
with the Fund.
Wachovia Bank, N.A. serves as custodian for the Fund.
6. FEES PAID TO INDEPENDENT DIRECTORS:
For the year ended May 31, 2005, Independent Director Charles E. Noell received
$9,000, and Independent Directors Bailey Morris-Eck and Joseph R. Hardiman each
received $12,500, for attendance at Board meetings.
7. REDEMPTION FEE:
The Fund imposes a redemption fee equal to 2% on shares redeemed within 180 days
of their purchase. The redemption fee is intended to limit short-term trading in
the Fund. Any proceeds from the fees will be credited to the assets of the Fund.
For the year ended May 31, 2005, $1,424 in redemption fees were retained by the
Fund.
8. INVESTMENT TRANSACTIONS:
The cost of security purchases and the proceeds from security sales, other than
short-term investments, for the year ended May 31, 2005 were as follows (000):
Purchases................................ $ 3,820
Sales.................................... 12,713
9. FEDERAL TAX INFORMATION:
Dividends from net investment income and distributions from net realized capital
gains are determined in accordance with U.S. Federal income tax regulations,
which may differ from those amounts determined under accounting principles
generally accepted in the United States of America. These book/tax differences
are either temporary or permanent in nature.
To the extent these differences are permanent, they are charged or credited to
paid-in-capital, undistributed net investment income or accumulated net realized
gain, as appropriate, in the period that the differences arise. Accordingly, the
following differences as of May 31, 2005, primarily attributable to certain net
operating losses, which for tax purposes have been reclassified to
paid-in-capital as follows (000):
Increase
Undistributed Decrease
Net Investment Paid-in-
Income Capital
-------------- --------------
$320 ($320)
During the years ended May 31, 2005 and May 31, 2004, there were no dividends
and distributions declared by the Fund.
As of May 31, 2005, the components of accumulated losses on a tax basis were as
follows (000):
Capital loss carryforwards:
Expiring in 2009 $ (15,922)
Expiring in 2010 (20,955)
Expiring in 2011 (35,702)
Expiring in 2012 (22,992)
Expiring in 2013 (458)
---------
Total capital loss carryforwards (96,029)
Post-October losses (720)
Net unrealized depreciation (31,674)
---------
Total accumulated losses $(128,423)
=========
For Federal income tax purposes, capital loss carryforwards may be carried
forward and applied against future capital gains. Post October losses represent
losses realized on investment transactions from November 1, 2004 through May 31,
2005 that, in accordance with Federal income tax regulations, the Fund may elect
to defer and treat as having arisen in the following fiscal year.
At May 31, 2005, the total cost of securities and the net realized gains or
losses on securities sold for federal income tax purposes were not different
from amounts reported for financial reporting purposes. The aggregate gross
unrealized appreciation and depreciation for securities held by the Fund at May
31, 2005, is as follows (000):
Federal Tax Cost......................... $ 52,153
========
Aggregate gross unrealized
appreciation ......................... 5,486
Aggregate gross unrealized
depreciation ......................... (37,160)
--------
Net unrealized depreciation ............ $(31,674)
========
10. CONCENTRATION/RISK:
The Fund is non-diversified, which means that it may invest in the securities of
relatively few companies. As a result, the Fund may be more susceptible to a
single adverse economic or regulatory occurrence affecting one or more of these
companies and may experience increased volatility due to its investments in
those securities.
10
<page>
NOTES TO FINANCIAL STATEMENTS (CONCLUDED) THE NEVIS FUND, INC.
May 31, 2005
11. COMMITMENTS AND CONTINGENCIES:
The Fund is involved, from time to time, in litigation arising in the ordinary
course of business, which, in the opinion of management, is not expected to
result in any significant adverse impact on the Fund's net assets or results of
operations. The Fund is covered by a directors and officer's insurance policy
with an initial $500,000 deductible for various litigation matters.
12. GAIN CONTINGENCY:
The Fund's Adviser is currently in discussion with regulatory authorities. The
discussion matter concerns the interpretation of certain terms of the advisory
agreement as stated in the Fund's registration statement. The outcome of the
discussions, although not determinable, may result in a future gain to the Fund.
13. CHANGE IN INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM:
The Board has selected Briggs, Bunting & Dougherty, LLP ("Briggs, Bunting") to
serve as the Fund's independent registered public accounting firm for the Fund's
fiscal year ending May 31, 2005. The decision to select Briggs, Bunting was
recommended by the Audit Committee and was approved by the Board on May 19,
2005.
The selection of Briggs, Bunting does not reflect any disagreements with or
dissatisfaction by the Fund or the Board with the performance of the Fund's
prior auditor. Rather, this change was approved by the Board upon the Audit
Committee's recommendation of Briggs, Bunting.
11
<page>
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and Board of Directors of
The Nevis Fund, Inc.
We have audited the accompanying statement of net assets of The Nevis Fund,
Inc., as of May 31, 2005, and the related statement of operations, the statement
of changes in net assets and the financial highlights for the year then ended.
These financial statements and financial highlights are the responsibility of
the Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audit. The statement
of changes in net assets for the year ended May 31, 2004 and the financial
highlights for each of the four years in the period then ended have been audited
by other auditors, whose reports dated July 27, 2004 and July 12, 2001 expressed
an unqualified opinion on such financial statements and financial highlights.
We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation of
securities owned as of May 31, 2005 by correspondence with the custodian. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides 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
Nevis Fund, Inc. as of May 31, 2005, the results of its operations, the changes
in its net assets and its financial highlights for the year then ended, in
conformity with accounting principles generally accepted in the United States of
America.
/s/ Briggs, Bunting & Dougherty, LLP
BRIGGS, BUNTING & DOUGHERTY, LLP
Philadelphia, Pennsylvania
June 20, 2005
12
<page>
DIRECTORS AND OFFICERS OF THE NEVIS FUND, INC. (UNAUDITED)
- ----------------------------------------------------------------------------------------------------------------------------------
TERM OF NUMBER OF
OFFICE PORTFOLIOS
AND PRINCIPAL IN FUND
POSITION(S) LENGTH OF OCCUPATION(S) COMPLEX OTHER DIRECTORSHIPS
NAME, HELD WITH TIME DURING PAST OVERSEEN HELD BY
ADDRESS AND AGE REGISTRANT SERVED FIVE YEARS BY DIRECTOR DIRECTOR
- ----------------------------------------------------------------------------------------------------------------------------------
INTERESTED DIRECTORS*
- --------------------
David R., Wilmerding, President and Indefinite; Managing Member, Nevis 1 N/A
III Director Director Capital Management LLC.
1119 St. Paul St. since 1998
Baltimore, MD 21202
44
- ----------------------------------------------------------------------------------------------------------------------------------
Jon C. Baker Senior Vice Indefinite; Managing Member, Nevis 1 N/A
1119 St. Paul St. President and Director Capital Management LLC.
Baltimore, MD 21202 Director since 1998
41
- ----------------------------------------------------------------------------------------------------------------------------------
INDEPENDENT DIRECTORS
- ---------------------
Joseph R. Hardiman Director Indefinite; Retired; President and Chief 1 Director, Corvis
1119 St. Paul St. Director Executive Officer and a member Corporation
Baltimore, MD 21202 since 1998 of the Board of Directors and the (optical networks),
68 Executive Committees of the National SoundView
Association of Securities Dealers, Inc. Technology Group,
and its wholly owned subsidiary, The Inc. (investment
Nasdaq Stock Market, Inc. from banking), Deutsche
September 1987 to January 1997. Asset Management
Funds and ISI
Family of Funds.
- ----------------------------------------------------------------------------------------------------------------------------------
Bailey Morris-Eck Director Indefinite; Senior Associate of the Reuters 1 Director of
Good Fellowship Farm Director Foundation and Director of Reuters/ Reuters/Carnegie
3023 Black Rock Road since 1999 Carnegie Public Policy Series. Served as Public Policy
Butler, MD 21023-1039 Vice President of the Bookings Institution Series, Investment
62 from April 1997 through April 1999. Served Company of
as a Senior Advisor to the U.S. President America, AMF,
on Economic Policy and Summit Coordina- AMCAP Fund, Inc.
tion from 1994-1997. and American Funds
Group.
- ----------------------------------------------------------------------------------------------------------------------------------
Charles E. Noell Director Indefinite; General Partner of JMI Equity Fund, L.P. 1 Director, Peregrine
1119 St. Paul St. Director Systems, Neon
Baltimore, MD 21202 since 1998 Systems and Trans-
53 action Systems
Architects, Inc.
(software companies)
- ----------------------------------------------------------------------------------------------------------------------------------
13
<page>
DIRECTORS AND OFFICERS OF THE NEVIS FUND, INC. (CONCLUDED) (UNAUDITED)
- ----------------------------------------------------------------------------------------------------------------------------------
TERM OF NUMBER OF
OFFICE PORTFOLIOS
AND PRINCIPAL IN FUND
POSITION(S) LENGTH OF OCCUPATION(S) COMPLEX OTHER DIRECTORSHIPS
NAME, HELD WITH TIME DURING PAST OVERSEEN HELD BY
ADDRESS AND AGE REGISTRANT SERVED FIVE YEARS BY DIRECTOR DIRECTOR
- ----------------------------------------------------------------------------------------------------------------------------------
OFFICERS
- --------
Timothy D. Barto Vice President Indefinite; SEI Investments since 1999. General N/A N/A
One Freedom and Assistant Since Counsel, Vice President and Secretary
Valley Drive Secretary 1/25/00 of the Administration and Adviser,
Oaks, PA 19456 present. Associate, Dechert Price &
37 Rhoades (law firm), 1997-1997.
- ----------------------------------------------------------------------------------------------------------------------------------
Edward J. Veilleux Vice President Indefinite; President, EJV Financial Services N/A N/A
One Freedom and Chief since (consulting) since 2002; Director,
Valley Drive Compliance 10/04 Deutsche Asset Management
Oaks, PA 19456 Officer 1987-2002.
61
- ----------------------------------------------------------------------------------------------------------------------------------
Michael Lawson+ Treasurer and Indefinite; SEI Investments since 10/98; Assistant N/A N/A
One Freedom Chief Financial since Product Manager, Pilgrim Baxter &
Associates (2/98-10/98); Manager of
Valley Drive Officer 07/05 Fund Accounting, SEI Investments
Oaks, PA 19456 (4/95-2/98); Investment Accounting
44 Manager, PFPC (11/92-4/95).
- ---------------------------------------------------------------------------------------------------------------------------------
James Ndiaye Vice President Indefinite; Joined SEI Investments in October 2004. N/A N/A
One Freedom and Assistant since Vice President, Deutsche Asset
Valley Drive Secretary 11/04 Management, 2003-2004. Associate,
Oaks, PA 19456 Morgan, Lewis & Bockius LLP,
36 2000-2003. Assistant Vice President,
ING Variable Annuities Group, 1999-2000.
- ----------------------------------------------------------------------------------------------------------------------------------
Philip Masterson Vice President Indefinite; Joined SEI Investments in August 2004. N/A N/A
One Freedom and Assistant since General Counsel, Citco Mutual Fund
Valley Drive Secretary 11/04 Services, 2003-2004. Vice President
Oaks, PA 19456 and Associate Counsel, Oppenheimer
41 Funds, 2001-2003. Vice President and
Assistant Counsel, OppenheimerFunds,
1997-2001.
- ----------------------------------------------------------------------------------------------------------------------------------
Michael Pang Vice President Indefinite; Joined SEI Investments Company in N/A N/A
One Freedom and Assistant since January 2005. Counsel, Caledonian Bank
Valley Drive Secretary 2/05 & Trust's Mutual Funds Group, 2004.
Counsel, Permal Asset Management,
Oaks, PA 19456 2001-2004. Associate, Schulte, Roth
33 & Zebels Investment Management,
2000-2001. Staff Attorney, U.S. SEC's
Division of Enforcement, Northeast
Regional Office, 1997-2000.
- ----------------------------------------------------------------------------------------------------------------------------------
Sofia Rosala Vice President Indefinite; Corporate Counsel of the Administrator N/A N/A
One Freedom and Assistant since since 2004. Compliance Officer of
Valley Drive Secretary 2/05 SEI Investments Company from
Oaks, PA 19456 2001-2004. Account & Product
31 Consultant, SEI Private Trust
Company, 1998-2001.
- ----------------------------------------------------------------------------------------------------------------------------------
<FN>
*Director who is deemed to be an "interested person" of the Nevis Fund as defined in the 1940 Act is referred to as an "Interested
Director". Mr. Wilmerding, III and Mr. Baker are considered to be "interested persons" of the Nevis Fund as they are Managing
Members of Nevis Capital Management LLC, the Nevis Fund's Adviser.
+Prior to Mr. Michael Lawson, Peter Golden served in the capacity of Treasurer and Chief Financial officer. A meeting of the Board
of Directors was held on July 26, 2005 at which time Mr. Golden's successor was elected.
</FN>
14
<page>
DISCLOSURE OF FUND EXPENSES THE NEVIS FUND, INC.
May 31, 2005 (Unaudited)
All mutual funds have operating expenses. As a shareholder of a mutual fund,
your investment is affected by these ongoing costs, which include investment
advisory fees. It is important for you to understand the impact of these costs
on your investment returns.
Operating expenses such as these are deducted from the mutual fund's gross
income and directly reduce its final investment return. These expenses are
expressed as a percentage of the mutual fund's average net assets; this
percentage is known as the mutual fund's expense ratio.
The following examples use the expense ratio and are intended to help you
understand the ongoing costs (in dollars) of investing in your Fund and to
compare these costs with those of other mutual funds. The examples are based on
an investment of $1,000 made at the beginning of the period shown and held for
the entire period.
The table below illustrates your Fund's costs in two ways:
o ACTUAL FUND RETURN. This section helps you to estimate the actual expenses
after fee waivers that your Fund incurred over the period. The "Expenses Paid
During Period" column shows the actual dollar expense cost incurred by a $1,000
investment in the Fund, and the "Ending Account Value" number is derived from
deducting that expense cost from the Fund's gross investment return.
You can use this information, together with the actual amount you invested in
the Fund, to estimate the expenses you paid over that period. Simply divide your
actual account value by $1,000 to arrive at a ratio (for example, an $8,600
account value divided by $1,000 = 8.6), then multiply that ratio by the number
shown for your Fund under "Expenses Paid During Period."
o HYPOTHETICAL 5% RETURN. This section helps you compare your Fund's costs with
those of other mutual funds. It assumes that the Fund had an annual 5% return
before expenses during the year, but that the expense ratio (Column 3) for the
period is unchanged. This example is useful in making comparisons because the
Securities and Exchange Commission requires all mutual funds to make this 5%
calculation. You can assess your Fund's comparative cost by comparing the
hypothetical result for your Fund in the "Expenses Paid During Period" column
with those that appear in the same charts in the shareholder reports for other
mutual funds.
NOTE: Because the return is set at 5% for comparison purposes -- NOT your Fund's
actual return -- the account values shown may not apply to your specific
investment.
- --------------------------------------------------------------------------------
BEGINNING ENDING EXPENSES
ACCOUNT ACCOUNT ANNUALIZED PAID
VALUE VALUE EXPENSE DURING
12/1/04 5/31/05 RATIOS PERIOD*
- --------------------------------------------------------------------------------
Actual Fund Return $1,000.00 $ 998.40 1.50% $7.47
Hypothetical 5% Return 1,000.00 1,017.45 1.50 7.54
* Expenses are equal to the Fund's annualized expense ratio multiplied by the
average account value over the period, multiplied by 182/365 (to reflect (the
one-half year period).
15
<page>
APPROVAL OF INVESTMENT ADVISORY AGREEMENTS THE NEVIS FUND, INC.
May 31, 2005 (Unaudited)
BOARD CONSIDERATIONS IN APPROVING THE ADVISORY AGREEMENT. The Board of
Directors' continuance of the Advisory Agreement, after the initial two-year
term, must be specifically approved at least annually (i) by the vote of the
Directors or by a vote of the shareholders of the Fund and (ii) by the vote of a
majority of the Directors who are not parties to the Advisory Agreement or
"interested persons" of any party thereto, cast in person at a meeting called
for the purpose of voting on such approval. Each year, the Board of Directors
(the "Board") calls and holds a meeting to decide whether to renew the Advisory
Agreement for an additional one-year term. In preparation for the meeting, the
Board requests and reviews a wide variety of information from the Adviser. The
Directors use this information, as well as other information that the Adviser
and other Fund service providers may submit to the Board, to help them decide
whether to renew the Advisory Agreement for another year.
Before this year's meeting on May 23, 2005, the Board requested and received
written materials from the Adviser regarding, among other things: (a) the
nature, extent and quality of the services to be provided by the Adviser; (b)
the investment performance of the Fund and the Adviser; (c) the costs of the
services to be provided and profits to be realized by the Adviser and its
affiliates from the relationship with the Fund; (d) the extent to which
economies of scale would be realized as the Fund grows; and (e) whether fee
levels reflect these economies of scale for the benefit of Fund investors, as
discussed in further detail below.
At the meeting, the Adviser, along with other Fund service providers, presented
additional oral and written information to help the Board evaluate the Adviser's
fee and other aspects of the Agreement. Among other things, the representative
reviewed the Adviser's background and investment management philosophy, noting
that there had been no change in investment philosophy or process.
Noting that the independent Directors met and separately discussed the advisory
agreement renewal in some depth, the Board then discussed the written materials
that the Board received before the meeting and the Adviser's oral presentation
and any other information that the Board received at the meeting, and
deliberated on the renewal of the Advisory Agreement in light of this
information. In its deliberations, the Board did not identify any single piece
of information discussed below that was all-important, controlling or
determinative of its decision.
NATURE, EXTENT AND QUALITY OF ADVISORY AND OTHER SERVICES. The Board considered
the experience of the individuals responsible for the day-to-day management of
the Fund, and their tenure with the Adviser. In considering the nature, extent
and quality of the services provided by the Adviser, the Board reviewed the
portfolio management services provided by the Adviser to the Fund, including the
quality and continuity of the Adviser's portfolio management personnel, and the
Board concluded that it was satisfied with the services provided to the Fund.
FUND PERFORMANCE AND INVESTMENT OBJECTIVES. The Board also compared the Fund's
performance to benchmark indices and other similar mutual funds over various
periods of time and, noting that they receive and discuss similar performance
reports at each quarterly meeting, concluded that they were satisfied with the
investment performance of the Fund.
COSTS OF ADVISORY SERVICES AND ECONOMIES OF SCALE. In concluding that the
advisory fees payable by the Fund were reasonable, the Board reviewed a report
of the costs of services provided by and the profits realized by the Adviser
from its relationship with the Fund and concluded on the basis of information
from the Adviser that the Fund was unprofitable due to its small size and
because the Adviser pays ordinary operating expenses of the Fund. The Board also
reviewed reports comparing the expense ratio and advisory fee paid by the Fund
to those paid by other comparable mutual funds and concluded that the advisory
fee was reasonable and the result of arm's length negotiations, and the expense
ratio paid by the Fund was consistent with industry standards, noting that a
reduction of Fund assets had lead to a situation in which fee waivers and
reimbursements exceeded the fee to which the Adviser was entitled. In addition,
the Board considered whether economies of scale were realized during the current
contract period, and determined that economies of scale did not appear
foreseeable in light of the lack of profitability of the Fund.
Based on the Board's deliberations and its evaluation of the information
described above, the Board, including all of the independent Directors,
unanimously: (a) concluded that terms of the Agreement are fair and reasonable;
(b) concluded that the Adviser's fees are reasonable in light of the services
that the Adviser provides to the Fund; and (c) agreed to renew the Agreement for
another year.
16
<page>
NOTES
INVESTMENT ADVISER
Nevis Capital Management LLC
1119 St. Paul Street
Baltimore, MD 21202
ADMINISTRATOR
SEI Investments Global Funds Services
One Freedom Valley Drive
Oaks, PA 19456
DIRECTORS
Joseph Hardiman
Bailey Morris-Eck
Charles Noell
Jon Baker
David Wilmerding, III
DISTRIBUTOR
SEI Investments Distribution Co.
One Freedom Valley Drive
Oaks, PA 19456
LEGAL COUNSEL
Morgan, Lewis & Bockius LLP
1701 Market Street
Philadelphia, PA 19103
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Briggs, Bunting & Dougherty, LLP
2 Penn Center, Suite 820
Philadelphia, PA 19102-1732
NEV-AR-002-0400
ITEM 2. CODE OF ETHICS.
The registrant has adopted a Code of Ethics that applies to the registrant's
principal executive officer, the principal financial officer, comptroller or
principal accounting officer, and any person who performs a similar function.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a)(1) The registrant's Board of Directors has determined that the Board's Audit
Committee does not have an "audit committee financial expert," as the Securities
and Exchange Commission has defined that term. After carefully considering all
of the factors involved in the definition of "audit committee financial expert,"
the Board determined that none of the members of the audit committee met all
five qualifications in the definition, although some members of the Audit
Committee met some of the qualifications. The Board also determined that while
the Audit Committee members have general financial expertise, given the size and
type of The Nevis Fund Inc., (the "Fund") and in light of the nature of the
accounting and valuation issues that the Fund has presented over the past
several years, it did not appear that the Audit Committee members lacked any
necessary skill to serve on the Audit Committee.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Fees billed by Briggs, Bunting & Dougherty, LLP and KPMG LLP ("KPMG") related to
the Fund
Briggs, Bunting & Dougherty, LLP billed the Fund aggregate fees for services
rendered to the Fund for the fiscal year 2005 and KPMG LLP billed the Fund
aggregate fees for services rendered to the Fund for the fiscal year 2004 as
follows:
- ------------------ ----------------------------------------------------- -----------------------------------------------------
2005* 2004+
- ------------------ ----------------------------------------------------- -----------------------------------------------------
All fees and All fees and All other fees All fees and All fees and All other fees
services to the services to and services to services to the services to and services to
Trust that were service service Trust that were service service
pre-approved affiliates that affiliates that pre-approved affiliates that affiliates that
were did not require were did not require
pre-approved pre-approval pre-approved pre-approval
- ------- ---------- ----------------- ----------------- ----------------- ----------------- ----------------- -----------------
(a) Audit $18,000 N/A $0 $52,000 N/A $0
Fees(1)
- ------- ---------- ----------------- ----------------- ----------------- ----------------- ----------------- -----------------
(b) Audit-Related $0 $0 $0 $0 $0 $0
Fees
- ------- ---------- ----------------- ----------------- ----------------- ----------------- ----------------- -----------------
(c) Tax Fees $0 $0 $0 $0 $0 $0
- ------- ---------- ----------------- ----------------- ----------------- ----------------- ----------------- -----------------
(d) All $0 $0 $0 $0 $0 $0
Other
Fees
- ------- ---------- ----------------- ----------------- ----------------- ----------------- ----------------- -----------------
*Briggs, Bunting & Dougherty, LLP
+KPMG
Notes:
(1) Audit fees include amounts related to the audit of the registrant's
annual financial statements and services normally provided by the
accountant in connection with statutory and regulatory filings.
(e)(1) Registrant's full audit committee is responsible for any pre-approval
of audit for non-audit services, and does pre-approve audit or
non-audit services pursuant to policies and procedures as described in
paragraph (c)(7) of Rule 2-01 of Regulation S-X.
(e)(2) Percentage of fees billed applicable to non-audit services pursuant to
waiver of pre-approval requirement were as follows:
---------------------------- ----------------- ----------------
2005* 2004+
---------------------------- ----------------- ----------------
Audit-Related Fees 0% 0%
---------------------------- ----------------- ----------------
Tax Fees 0% 0%
---------------------------- ----------------- ----------------
All Other Fees 0% 0%
---------------------------- ----------------- ----------------
*Briggs, Bunting & Dougherty, LLP
+KPMG
(f) Not applicable.
(g)(1) The aggregate non-audit fees and services billed by Briggs, Bunting &
Dougherty, LLP for fiscal year 2005 were $0.
(g)(2) The aggregate non-audit fees and services billed by KPMG for fiscal
year 2004 were $0.
(h) Not applicable.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable to open-end management investment companies.
ITEM 6. SCHEDULE OF INVESTMENTS
Not applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable to open-end management investment companies.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES
Not applicable. Effective for closed-end management investment companies for
fiscal years ending on or after December 31, 2005
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT COMPANY AND
AFFILIATED PURCHASERS.
Not applicable to open-end management investment companies.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not applicable.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The certifying officers, whose certifications are included herewith, have
evaluated the registrant's disclosure controls and procedures within 90 days of
the filing date of this report. In their opinion, based on their evaluation, the
registrant's disclosure controls and procedures are adequately designed, and are
operating effectively to ensure, that information required to be disclosed by
the registrant in the reports it files or submits under the Securities Exchange
Act of 1934 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 significant changes in the registrant's internal control over
financial reporting that occurred during the registrant's last fiscal half-year
that has materially affected, or is reasonably likely to materially affect, the
registrants internal control over financial reporting.
ITEMS 12. EXHIBITS.
(a)(1) Code of Ethics attached hereto.
(a)(2) A separate certification for the principal executive officer and the
principal financial officer of the registrant as required by Rule 30a-2(a) under
the Investment Company Act of 1940, as amended (17 CFR 270.30a-2(a)), are filed
herewith.
(b) Officer certifications as required by Rule 30a-2(b) under the Investment
Company Act of 1940, as amended (17 CFR 270.30a-2(b)) also accompany this filing
as an Exhibit.
- --------------------------------------------------------------------------------
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.
(Registrant) The Nevis Fund, Inc.
By (Signature and Title)* /s/ David R. Wilmerding, III
----------------------------
David R. Wilmerding, III
Chief Executive Officer
Date: 08/09/05
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/ David R. Wilmerding, III
----------------------------
David R. Wilmerding, III
Chief Executive Officer
Date: 08/09/05
By (Signature and Title)* /s/ Michael Lawson
------------------
Michael Lawson
Chief Financial Officer
Date: 08/09/05
* Print the name and title of each signing officer under his or her signature.