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: 811-08188
AllianceBernstein Emerging Market Debt Fund, Inc.
(Exact name of registrant as specified in charter)
1345 Avenue of the Americas, New York, New York 10105
(Address of principal executive offices) (Zip code)
Edmund P. Bergan, Jr.
Alliance Capital Management, L.P.
1345 Avenue of the Americas
New York, New York 10105
(Name and address of agent for service)
Registrant's telephone number, including area code: (800) 221-5672
Date of fiscal year end: August 31, 2003
Date of reporting period: August 31, 2003
ITEM 1. REPORTS TO STOCKHOLDERS.
[LOGO] ALLIANCEBERNSTEIN(SM)
Investment Research & Management
AllianceBernstein Emerging Market
Debt Fund
Annual Report--August 31, 2003
Investment Products Offered
====================================
o Are Not FDIC Insured
o May Lose Value
o Are Not Bank Guaranteed
====================================
This shareholder report must be preceded or accompanied by the Fund's prospectus
for individuals who are not current shareholders of the Fund.
You may obtain a description of the Fund's proxy voting policies and procedures,
without charge, upon request by visiting Alliance Capital's web site at
www.investor.alliancecapital.com or on the Securities and Exchange Commision's
web site at http://www.sec.gov, or by calling Alliance Capital at (800)
227-4618.
AllianceBernstein Investment Research and Management, Inc., the principal
underwriter of the AllianceBernstein mutual funds and an affiliate of Alliance
Capital Management L.P., the manager of the funds, is a member of the NASD.
October 6, 2003
Annual Report
This report provides performance, investment strategy and outlook for
AllianceBernstein Emerging Market Debt Fund (the "Fund") for the annual
reporting period ended August 31, 2003.
Investment Objectives and Policies
This open-end fund is designed to provide investors with a high level of current
income and, secondarily, capital appreciation. To achieve its objectives, the
Fund invests primarily in a non-diversified portfolio of sovereign debt
obligations and in U.S. and non-U.S. corporate fixed-income securities. The Fund
invests substantially all of its assets in lower-rated securities.
Investment Results
The following table shows how the Fund performed over the past six- and 12-month
periods ended August 31, 2003. For comparison, we have included the returns for
the unmanaged J.P. Morgan Emerging Markets Bond Index Plus (JPM EMBI+), which
provides a broad measure of the performance of a basket of emerging market debt
securities.
INVESTMENT RESULTS*
Periods Ended August 31, 2003
========================================
Returns
========================================
6 Months 12 Months
- --------------------------------------------------------------------------------
AllianceBernstein
Emerging Market
Debt Fund
Class A 16.67% 41.80%
- --------------------------------------------------------------------------------
Class B 16.17% 40.69%
- --------------------------------------------------------------------------------
Class C 16.30% 40.80%
- --------------------------------------------------------------------------------
J.P. Morgan
Emerging
Markets
Bond Index
Plus 12.05% 30.33%
- --------------------------------------------------------------------------------
* The Fund's investment results are for the periods shown and are based on
the net asset value (NAV) of each class of shares as of August 31, 2003.
Returns do not reflect the deduction of taxes that a shareholder would pay on
fund distributions or the redemption of fund shares. All fees and expenses
related to the operation of the Fund have been deducted, but no adjustment
has been made for sales charges that may apply when shares are purchased or
redeemed. Returns for the Fund include the reinvestment of any distributions
paid during each period. Past performance is no guarantee of future results.
The unmanaged J.P. Morgan Emerging Markets Bond Index Plus is a total
return index that tracks the traded market for U.S. dollar-denominated
restructured sovereign bonds; a large percentage of the index is made up of
Brady bonds. The index is unmanaged and reflects no fees or expenses. An
investor cannot invest directly in an index, and its results are not
indicative of any particular investment, including AllianceBernstein Emerging
Market Debt Fund.
Additional investment results appear on page 5.
The Fund outperformed its benchmark, the JPM EMBI+, for both the six- and
12-month periods ended August 31, 2003. The Fund's outperformance was primarily
attributable to
- --------------------------------------------------------------------------------
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 1
its country and security selection. The Fund's overweight allocation to Brazil,
and security selection within it, were the largest contributors to both absolute
and relative performance during the periods under review. Brazilian debt was
also a top performer within the JPM EMBI+, generating six- and 12-month total
returns of 27.0% and 65.8%, respectively.
During the six-month period ended August 31, 2003, performance of the Fund's
holdings of Uruguayan and Venezuelan debt had a positive impact on performance.
Both countries conducted debt exchanges during this period that significantly
improved the maturity structure of their external debt. In the Index, Venezuela
generated a total return of 26.2%, while Uruguay returned 48.9% for the same
period. We have maintained the Fund's overweight position in Russian sovereign
debt, as credit statistics continue to improve. For the annual period, Russian
bonds bettered the Index, returning 31.6%. During the recent six months,
however, the country has lagged the Index, but still generated a positive 7.6%
return.
Market Review and Investment Strategy
During the annual period, investors' desire for higher yielding asset classes
benefited the emerging debt markets. The emerging market debt class, as
represented by the JPM EMBI+, returned a strong 30.33% for the period. Latin
countries outperformed non-Latin regions, posting returns of 35.00% and
24.45%, respectively. Top performing countries were Brazil, Ecuador, Nigeria and
Colombia, while Bulgaria, Poland and Malaysia lagged. All emerging market debt
countries, however, posted positive returns for the period.
At the beginning of the annual period, we increased the Fund's exposure to
Brazil on expectations of a victory for President Lula and on confidence that
his administration would implement market-friendly policies. We further
increased the Fund's exposure to the country during the first half of the
period, as President Lula exceeded expectations in his ability to push forward
crucial tax and social security reforms. We have maintained this position.
Russia and Mexico continue to be large portfolio weightings; however, we reduced
the Fund's Mexican holdings in the final three months of the period as bond
valuations began to exceed interest rate risk. Although we avoided Venezuela
during the last months of 2002, we made a modest investment in the spring, once
new management of the state-owned oil company, PDVSA, proved adept at improving
oil production. This helped to augment international reserves. In April,
Uruguay, with the support of the International Monetary Fund (IMF), announced an
aggressive plan to swap its outstanding debt for longer maturity securities. We
aggressively bought Uruguay bonds after this announcement--a tactic that proved
beneficial to the Fund.
- --------------------------------------------------------------------------------
2 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
PERFORMANCE UPDATE
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
GROWTH OF A $10,000 INVESTMENT
2/25/94* TO 8/31/03
J.P. Morgan Emerging Markets Bond Index Plus: $29,545
AllianceBernstein Emerging Market Debt Fund Class A: $28,112
[GRAPH OMITTED]
[DATA BELOW REPRESENT MOUNTAIN CHART]
AllianceBernstein J.P. Morgan
Emerging Market Emerging Markets
Debt Fund Class A Bond Index Plus
- -----------------------------------------------------------------------------
2/25/94* 9579 10000
8/31/94 9218 9497
8/31/95 9081 9913
8/31/96 12572 13722
8/31/97 16347 17892
8/31/98 10042 12547
8/31/99 12993 16371
8/31/00 18157 21989
8/31/01 18442 22915
8/31/02 19809 22670
8/31/03 28126 29545
This chart illustrates the total value of an assumed $10,000 investment in
AllianceBernstein Emerging Market Debt Fund Class A shares (from 2/25/94* to
8/31/03) as compared to the performance of an appropriate broad-based index.
Returns do not reflect the deduction of taxes that a shareholder would pay on
fund distributions or the redemption of fund shares. The chart reflects the
deduction of the maximum 4.25% sales charge from the initial $10,000 investment
in the Fund and assumes the reinvestment of dividends and capital gains.
Performance for Class B and Class C shares will vary from the results shown
above due to differences in expenses charged to these classes. Past performance
is not indicative of future results, and is not representative of future gain or
loss in capital value or dividend income.
The unmanaged J.P. Morgan Emerging Markets Bond Index Plus is composed of
dollar-denominated restructured sovereign bonds; a large percentage of the index
is made up of Brady bonds.
When comparing AllianceBernstein Emerging Market Debt Fund to the index shown
above, you should note that no charges or expenses are reflected in the
performance of the index. An investor cannot invest directly in an index, and
its results are not indicative of any specific investment, including
AllianceBernstein Emerging Market Debt Fund .
* Fund and benchmark data are from the Fund's Class A share inception date of
2/25/94.
- --------------------------------------------------------------------------------
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 3
PORTFOLIO SUMMARY
August 31, 2003
INCEPTION DATES
Class A Shares
2/25/94
Class B Shares
2/25/94
Class C Shares
2/25/94
PORTFOLIO STATISTICS
Net Assets ($mil): $281.7
SECURITY TYPE
73.4% Sovereign
14.3% Corporate
8.0% Brady Bonds [PIE CHART OMITTED]
0.5% Loan Participation
3.8% Short-Term
COUNTRY BREAKDOWN
20.6% Russia
20.1% Brazil
18.3% Mexico
7.6% United States
4.3% Venezuela
3.9% Philippines
3.9% Colombia [PIE CHART OMITTED]
3.4% Ukraine
3.2% Turkey
3.2% Peru
1.8% Panama
1.5% Ecuador
1.4% Argentina
1.2% Uruguay
5.6% Other
All data as of August 31, 2003. The Fund's security type and country breakdowns
are expressed as a percentage of total investments and may vary over time.
"Other" represents less than 1.0% weightings in the following countries: El
Salvador, Luxembourg, South Africa, Romania, Cayman Islands, Belize, Morocco,
Netherlands, Guatemala, South Korea, Bulgaria and Costa Rica.
- --------------------------------------------------------------------------------
4 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
INVESTMENT RESULTS
AVERAGE ANNUAL RETURNS AS OF AUGUST 31, 2003
Class A Shares
- --------------------------------------------------------------------------------
Without Sales Charge With Sales Charge
1 Year 41.80% 35.71%
5 Years 22.84% 21.80%
Since Inception* 11.98% 11.48%
SEC Yield** 6.71%
Class B Shares
- --------------------------------------------------------------------------------
Without Sales Charge With Sales Charge
1 Year 40.69% 37.69%
5 Years 21.88% 21.88%
Since Inception*(a) 11.45% 11.45%
SEC Yield** 6.23%
Class C Shares
- --------------------------------------------------------------------------------
Without Sales Charge With Sales Charge
1 Year 40.80% 39.80%
5 Years 21.93% 21.93%
Since Inception* 11.12% 11.12%
SEC Yield** 6.23%
SEC AVERAGE ANNUAL RETURNS (WITH SALES CHARGES)
AS OF THE MOST RECENT QUARTER-END (SEPTEMBER 30, 2003)
Class A Class B Class C
- --------------------------------------------------------------------------------
1 Year 46.74% 48.84% 50.75%
5 Years 21.12% 21.16% 21.17%
Since Inception* 11.78% 11.74%(a) 11.40%
The Fund's investment results represent average annual returns. Returns do not
reflect the deduction of taxes that a shareholder would pay on fund
distributions or the redemption of fund shares. The returns reflect reinvestment
of dividends and/or capital gains distributions in additional shares without and
with the effect of the 4.25% maximum front-end sales charge for Class A or
applicable contingent deferred sales charge for Class B (3% year 1, 2% year 2,
1% year 3, 0% year 4); and for Class C shares (1% year 1). Returns for Class A
shares do not reflect the imposition of the 1 year, 1% contingent deferred sales
charge for accounts over $1,000,000.
The Fund invests a significant amount of its assets in foreign securities, which
may magnify fluctuations and can invest a significant portion of its assets in
the securities of a single issuer, which may present greater risk than a more
diversified portfolio. Price fluctuation may be caused by changes in interest
rates or bond credit quality ratings. Changes in interest rates have a greater
effect on bonds with longer maturities than on those with shorter maturities.
Past performance does not guarantee future results. Investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their original cost.
* Inception date: 2/25/94 for all share classes.
** SEC yields are based on SEC guidelines and are calculated on 30 days ended
August 31, 2003.
(a) Assumes conversion of Class B shares into Class A shares after six years.
- --------------------------------------------------------------------------------
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 5
PORTFOLIO OF INVESTMENTS
August 31, 2003
Principal
Amount
(000) U.S. $ Value
- --------------------------------------------------------------------------------
SOVEREIGN DEBT OBLIGATIONS-79.7%
Argentina-1.3%
Republic of Argentina FRN
1.162%, 8/03/12 ............................ $ 6,379 $ 3,763,610
-----------
Belize-0.5%
Government of Belize
9.50%, 8/15/12 ............................. 1,500 1,521,522
-----------
Brazil-18.8%
Banco Nac Desenv Bondes
6.50%, 6/15/06(a) .......................... 1,850 1,893,937
Federal Republic of Brazil
8.875%, 4/15/24 ........................... 3,300 2,516,250
9.375%, 4/07/08 ........................... 2,925 2,932,313
10.00%, 1/16/07 ........................... 1,600 1,661,200
10.125%, 5/15/27 .......................... 4,250 3,672,000
11.00%, 1/11/12 ........................... 1,100 1,100,000
11.00%, 8/17/40 ........................... 7,897 7,202,064
11.25%, 7/26/07 ........................... 2,200 2,341,900
12.00%, 4/15/10 ........................... 3,100 3,259,650
12.75%, 1/15/20 ........................... 3,950 4,108,000
14.50%, 10/15/09 .......................... 2,650 3,100,500
C- Bonds
8.00%, 4/15/14 ............................ 15,054 13,586,223
DCB FRN
Series L
2.188%, 4/15/12 ........................... 6,825 5,485,935
-----------
52,859,972
Bulgaria-0.3%
Republic of Bulgaria
8.25%, 1/15/15(a) ......................... 792 877,140
-----------
Colombia-3.8%
Republic of Colombia
9.75%, 4/23/09 ............................ 375 418,313
10.00%, 1/23/12 ........................... 2,150 2,330,063
10.50%, 7/09/10 ........................... 250 282,500
10.75%, 1/15/13 ........................... 3,100 3,484,400
11.75%, 2/25/20 ........................... 3,490 4,057,125
-----------
10,572,401
-----------
Costa Rica-0.2%
Republic of Costa Rica
8.05%, 1/31/13(a) ......................... 400 433,000
-----------
- --------------------------------------------------------------------------------
6 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
Principal
Amount
(000) U.S. $ Value
- --------------------------------------------------------------------------------
Ecuador-1.4%
Republic of Ecuador
7.00%, 8/15/30(a)(b) ........................ $ 6,050 $ 3,554,376
12.00%, 11/15/12(a) ......................... 600 472,500
-----------
4,026,876
-----------
El Salvador-0.7%
Republic of El Salvador
7.75%, 1/24/23(a) ........................... 1,000 1,035,000
8.50%, 7/25/11(a) ........................... 1,000 1,050,500
-----------
2,085,500
-----------
Guatemala-0.3%
Republic of Guatemala
9.25%, 8/01/13(a) ........................... 950 964,250
-----------
Mexico-14.7%
United Mexican States
6.625%, 3/03/15(c) .......................... 7,025 7,053,100
11.375%, 9/15/16 ............................ 25,100 34,449,749
-----------
41,502,849
-----------
Morocco-0.5%
Kingdom of Morocco Loan Participation FRN
Series A
2.031%, 1/01/09 ............................. 1,373 1,321,291
-----------
Panama-1.8%
Republic of Panama
9.375%, 4/01/29 ............................. 2,400 2,736,000
9.625%, 2/08/11 ............................. 850 960,500
10.75%, 5/15/20 ............................. 1,025 1,219,750
-----------
4,916,250
-----------
Peru-3.1%
Republic of Peru
9.125%, 1/15/08 ............................. 975 1,086,150
9.125%, 2/21/12(a) .......................... 4,650 4,963,875
9.875%, 2/06/15 ............................. 2,525 2,790,125
-----------
8,840,150
-----------
Philippines-3.8%
Republic of Philippines
8.25%, 1/15/14 .............................. 3,300 3,320,625
9.00%, 2/15/13 .............................. 3,625 3,702,938
9.875%, 1/15/19 ............................. 1,100 1,151,150
10.625%, 3/16/25 ............................ 2,300 2,527,700
-----------
10,702,413
-----------
- --------------------------------------------------------------------------------
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 7
Principal
Amount
(000) U.S. $ Value
- --------------------------------------------------------------------------------
Russia-15.9%
Russian Federation
5.00%, 3/31/30(a)(b) ........ $ 36,155 $ 33,127,018
12.75%, 6/24/28(a) .......... 3,000 4,672,500
Russian Ministry of Finance
Series V
3.00%, 5/14/08 .............. 2,400 2,094,000
Series VI
3.00%, 5/14/06(a) ........... 1,250 1,195,375
3.00%, 5/14/06 .............. 3,950 3,777,385
------------
44,866,278
------------
South Africa-0.8%
Republic of South Africa
7.375%, 4/25/12 ............. 2,000 2,190,000
------------
Turkey-3.1%
Republic of Turkey
11.00%, 1/14/13 ............. 1,900 2,007,350
11.75%, 6/15/10 ............. 3,045 3,364,725
11.875%, 1/15/30 ............ 1,525 1,658,438
12.375%, 6/15/09 ............ 1,425 1,617,375
------------
8,647,888
------------
Ukraine-3.4%
Government of Ukraine
7.65%, 6/11/13(a) ........... 2,500 2,460,000
11.00%, 3/15/07(a) .......... 6,339 6,957,303
------------
9,417,303
------------
Uruguay-1.2%
Republic of Uruguay
7.25%, 2/15/11 .............. 1,050 821,625
7.50%, 3/15/15 .............. 361 269,131
7.875%, 1/15/33 ............. 3,625 2,274,687
------------
3,365,443
------------
Venezuela-4.1%
Republic of Venezuela
9.25%, 9/15/27 .............. 11,575 8,785,425
DCB FRN
Series DL
1.875%, 12/18/07 ............ 3,214 2,860,638
------------
11,646,063
------------
Total Sovereign Debt Obligations
(cost $185,672,174) ............ 224,520,199
------------
- --------------------------------------------------------------------------------
8 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
Principal
Amount
(000) U.S. $ Value
- --------------------------------------------------------------------------------
CORPORATE DEBT OBLIGATIONS-13.9%
Brazil-0.7%
Petrobras International Finance
9.875%, 5/09/08 ............... $ 1,100 $1,193,500
Unibanco
9.375%, 4/30/12(a)(b) ......... 900 904,500
----------
2,098,000
----------
Cayman Islands-0.9%
PF Export Receivables Master Trust
6.436%, 6/01/15(a) ............ 2,800 2,629,368
----------
Luxembourg-2.0%
Mobile Telesystems Finance
9.75%, 1/30/08(a) ............. 1,700 1,836,000
10.95%, 12/21/04 .............. 1,405 1,503,350
PTC International Finance II, SA
11.25%, 12/01/09 .............. 2,000 2,170,000
----------
5,509,350
----------
Mexico-3.1%
Innova S de. R.L., SA
12.875%, 4/01/07 .............. 4,750 4,880,625
Monterrey Power SA de C.V ........
9.625%, 11/15/09(a) ........... 857 982,612
Pemex Project Funding Master Trust
8.625%, 2/01/22(a) ............ 500 531,250
9.125%, 10/13/10 .............. 2,000 2,340,000
----------
8,734,487
----------
Netherlands-2.1%
Hurricane Finance
9.625%, 2/12/10(a) ............ 900 967,500
Kazkommerts International BV
8.50%, 4/16/13(a) ............. 4,100 4,018,000
Turanalem Finance BV
10.00%, 5/29/07(a) ............ 1,000 1,042,000
----------
6,027,500
----------
Romania-0.4%
MobiFon Holdings BV
12.50%, 7/31/10(a) ............ 1,100 1,171,500
----------
Russia-3.0%
Gazprom Oao
9.625%, 3/01/13(a) ............ 5,550 5,883,000
Tyumen Oil
11.00%, 11/06/07(a) ........... 2,200 2,456,188
----------
8,339,188
----------
South Korea-0.3%
Hanvit Bank, SA
12.75%, 3/01/10(a) ............ 725 820,156
----------
- --------------------------------------------------------------------------------
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 9
Shares or
Principal
Amount
(000) U.S. $ Value
- -----------------------------------------------------------------------------
United States-1.4%
Citgo Petroleum Group
11.375%, 2/01/11(a) .............. $ 1,900 $ 2,128,000
Freeport-McMoran Copper & Gold
10.125%, 2/01/10 ................. 1,550 1,693,375
------------
3,821,375
------------
Total Corporate Debt Obligations
(cost $36,788,212) ............... 39,150,924
------------
WARRANTS(d)-0.0%
Central Bank of Nigeria
Warrants, expiring 11/15/20 ...... 3,250 -0-
Republic of Venezuela
Warrants, expiring 4/15/20 ....... 48,195 -0-
------------
Total Warrants
(cost $0) ........................ -0-
------------
SHORT-TERM INVESTMENT-3.7%
Time Deposit-3.7%
Societe Generale
1.06%, 9/02/03
(cost $10,300,000) ............... $ 10,300 10,300,000
------------
Total Investments-97.3%
(cost $232,760,386) ........... 273,971,123
Other assets less liabilities-2.7% 7,745,970
------------
Net Assets-100% .................. $281,717,093
------------
CREDIT DEFAULT SWAP CONTRACTS (see Note D)
Swap Counterparty Notional Unrealized
Referenced Amount Termination Appreciation/
Obligation (000's) Interest Rate Date (Depreciation)
- ---------------------- ---------- --------------- ------------ ---------------
Buy Contracts:
Citigroup Global Markets, Inc.
Republic of Colombia
9.75%, 4/23/09 10,000 3.15% 1/30/04 $ (77,000)
Morgan Stanley
Federal Republic of Brazil
10.125%, 5/15/27 2,000 15.25 7/30/04 (238,800)
Sale Contracts:
Citigroup Global Markets, Inc.
Federal Republic of Brazil
12.25%, 3/06/30 3,300 6.35 8/20/05 77,550
Citigroup Global Markets, Inc.
Republic of Turkey
11.875%, 1/15/30 3,650 17.30 8/13/08 57,144
Citigroup Global Markets, Inc.
Republic of Colombia
9.75%, 4/23/09 10,000 5.70 1/30/05 520,000
- --------------------------------------------------------------------------------
10 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
CREDIT DEFAULT SWAP CONTRACTS (continued)
Swap Counterparty Notional Unrealized
Referenced Amount Termination Appreciation/
Obligation (000's) Interest Rate Date (Depreciation)
- ---------------------- ---------- --------------- ------------ ---------------
Sale Contracts (continued)
Deutsche Bank
Federal Republic of Brazil
8.00%, 4/15/14 3,500 14.50% 3/08/08 $ 897,400
Deutsche Bank
Federal Republic of Brazil
12.25%, 3/06/30 1,300 17.85 2/06/08 485,550
Deutsche Bank
Republic of Romania
8.50%, 5/08/12 3,500 3.55 4/03/10 65,800
J. P. Morgan Chase
Federal Republic of Brazil
8.00%, 8/15/14 1,650 8.60 9/20/08 55,935
J. P. Morgan Chase
Federal Republic of Brazil
8.00%, 8/15/14 1,650 9.05 9/20/13 97,515
J. P. Morgan Chase
Russian Federation
5.00%, 3/31/30 3,300 3.20 6/25/13 40,590
J. P. Morgan Chase
Russian Federation
5.00%, 3/31/30 3,300 3.20 6/26/13 40,590
Morgan Stanley
Federal Republic of Brazil
10.125%, 5/15/27 2,000 17.75 2/13/08 707,800
UBS Warburg
Federal Republic of Brazil
11.00%, 8/17/40 2,250 8.80 9/20/13 118,125
REVERSE REPURCHASE AGREEMENT (see Note D)
Broker Interest Rate Maturity Amount
- ---------------- --------- ---------------- -----------
Lehman Brothers 0.50% 12/31/03 $4,949,183
(a) Security is exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At August 31,
2003, the aggregate market value of these securities amounted to $90,720,223
or 32.2% of net assets.
(b) Coupon increases periodically based upon a predetermined schedule. Stated
interest rate in effect at August 31, 2003.
(c) Position, or portion thereof, with an aggregate market value of $5,187,465
has been segregated to collateralize reverse repurchase agreements.
(d) Non-income producing security.
Glossary of Terms:
DCB -Debt Conversion Bonds
FRN -Floating Rate Note
See notes to financial statements.
- --------------------------------------------------------------------------------
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 11
STATEMENT OF ASSETS & LIABILITIES
August 31, 2003
Assets
Investments in securities,
at value (cost $232,760,386).......................... $ 273,971,123
Cash.................................................... 587,434
Interest receivable..................................... 7,275,626
Receivable for investment securities sold............... 5,562,803
Unrealized appreciation on swap contracts............... 3,163,999
Receivable for capital stock sold....................... 1,926,620
---------------
Total assets............................................ 292,487,605
---------------
Liabilities
Reverse repurchase agreement............................ 4,949,183
Unrealized depreciation on swap contracts............... 315,800
Payable for investment securities purchased............. 2,120,906
Payable for capital stock redeemed...................... 1,797,516
Dividend payable........................................ 657,853
Interest payable........................................ 358,878
Advisory fee payable.................................... 175,390
Distribution fee payable................................ 166,583
Administrative fee payable.............................. 23,006
Accrued expenses........................................ 205,397
---------------
Total liabilities....................................... 10,770,512
---------------
Net Assets.............................................. $ 281,717,093
---------------
Composition of Net Assets
Capital stock, at par................................... $ 36,243
Additional paid-in capital.............................. 287,211,796
Distributions in excess of net investment income........ (1,003,454)
Accumulated net realized loss on investment
transactions.......................................... (48,586,428)
Net unrealized appreciation on investments.............. 44,058,936
---------------
$ 281,717,093
---------------
Calculation of Maximum Offering Price
Class A Shares
Net asset value and redemption price per share
($118,669,083 / 15,363,737 shares of
capital stock issued and outstanding)................. $7.72
Sales charge--4.25% of public offering price............ .34
-----
Maximum offering price.................................. $8.06
-----
Class B Shares
Net asset value and offering price per share
$89,570,900 / 11,480,068 shares of
capital stock issued and outstanding)................... $7.80
-----
Class C Shares
Net asset value and offering price per share
($73,477,110 / 9,399,331 shares of
capital stock issued and outstanding)................... $7.82
-----
See notes to financial statements.
- --------------------------------------------------------------------------------
12 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
STATEMENT OF OPERATIONS
Year Ended August 31, 2003
Investment Income
Interest............................... $ 29,348,692
Expenses
Advisory fee........................... $ 1,888,435
Distribution fee--Class A.............. 307,679
Distribution fee--Class B.............. 896,195
Distribution fee--Class C.............. 596,120
Transfer agency........................ 331,722
Custodian.............................. 231,633
Administrative......................... 140,200
Audit and legal........................ 131,475
Printing............................... 103,163
Registration........................... 65,663
Directors' fees........................ 20,088
Miscellaneous.......................... 23,108
---------------
Total expenses before interest......... 4,735,481
Interest expense....................... 1,194,486
---------------
Total expenses......................... 5,929,967
Less: expense offset arrangement
(see Note B)........................... (234)
---------------
Net expenses........................... 5,929,733
---------------
Net investment income.................. 23,418,959
---------------
Realized and Unrealized Gain (Loss)
on Investment Transactions
Net realized gain (loss) on:
Investment transactions............. 29,681,299
Written options..................... 420,087
Swap contract....................... (90,560)
Net change in unrealized
appreciation/depreciation of:
Investments......................... 28,882,188
Swap contracts...................... 2,918,199
---------------
Net gain on investment transactions.... 61,811,213
---------------
Net Increase in Net Assets
from Operations........................ $ 85,230,172
---------------
See notes to financial statements.
- --------------------------------------------------------------------------------
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 13
STATEMENT OF CHANGES IN NET ASSETS
Year Ended Year Ended
August 31, August 31,
2003 2002
--------------- ---------------
Increase (Decrease) In Net Assets
From Operations
Net investment income.................. $ 23,418,959 $ 20,824,274
Net realized gain (loss) on
investment transactions............. 30,010,826 (24,305,694)
Net change in unrealized
appreciation/depreciation
of investments...................... 31,800,387 15,480,097
--------------- ---------------
Net increase in net assets
from operations..................... 85,230,172 11,998,677
Dividends to Shareholders from:
Net investment income
Class A............................. (10,200,153) (8,504,921)
Class B............................. (8,446,512) (9,034,739)
Class C............................. (5,499,918) (4,787,207)
Tax return of capital
Class A............................. -0- (735,143)
Class B............................. -0- (780,940)
Class C............................. -0- (413,794)
Capital Stock Transactions
Net increase........................... 18,645,018 23,122,724
--------------- ---------------
Total increase......................... 79,728,607 10,864,657
Net Assets
Beginning of period.................... 201,988,486 191,123,829
--------------- ---------------
End of period.......................... $ 281,717,093 $ 201,988,486
--------------- ---------------
See notes to financial statements.
- --------------------------------------------------------------------------------
14 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
STATEMENT OF CASH FLOWS
Year Ended August 31, 2003
Increase (Decrease) in Cash from
Operating Activities:
Interest received...................... $ 25,635,479
Interest expense paid.................. (873,167)
Operating expenses paid................ (4,663,539)
---------------
Net increase in cash from operating
activities.......................... $ 20,098,773
Investing Activities:
Proceeds from disposition of long-term
portfolio investments............... 362,963,211
Purchase of long-term portfolio
investments......................... (331,156,020)
Purchase of short-term portfolio
investments, net.................... (9,541,820)
---------------
Net increase in cash from investing
activities.......................... 22,265,371
Financing Activities:*
Decrease in reverse repurchase
agreements.......................... (36,528,715)
Subscription of capital stock, net..... 7,334,330
Cash dividends paid.................... (12,582,482)
---------------
Net decrease in cash from financing
activities.......................... (41,776,867)
---------------
Net increase in cash................... 587,277
Cash at beginning of period............ 157
---------------
Cash at end of period.................. $ 587,434
---------------
- -------------------------------------------------------------------------------
Reconciliation of Net Increase in
Net Assets from Operations to
Net Increase in Cash from Operating
Activities:
Net increase in net assets resulting from
operations........................... $ 85,230,172
Adjustments:
Increase in interest receivable........ $ (710,483)
Net realized gain on investment
transactions......................... (30,010,826)
Net change in unrealized
appreciation/depreciation
of investments ...................... (31,800,387)
Accretion of bond discount and
amortization of bond premium......... (3,002,730)
Increase in interest payable........... 321,319
Increase in accrued expenses........... 71,708
---------------
Total adjustments...................... (65,131,399)
---------------
Net Increase in Cash from Operating
Activities............................. $ 20,098,773
---------------
* Non-cash financing activities not included herein consist of reinvestment of
dividends. See notes to financial statements.
- --------------------------------------------------------------------------------
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 15
NOTES TO FINANCIAL STATEMENTS
August 31, 2003
NOTE A
Significant Accounting Policies
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND, Inc. (the "Fund"), formerly
Alliance Emerging Market Debt Fund, Inc., was incorporated in the state of
Maryland on December 2, 1993, as a non-diversified, open-end management
investment company. The Fund offers Class A, Class B and Class C shares. Class A
shares are sold with a front-end sales charge of up to 4.25% for purchases not
exceeding $1,000,000. With respect to purchases of $1,000,000 or more, Class A
shares redeemed within one year of purchase may be subject to a contingent
deferred sales charge of 1%. Class B shares are currently sold with a contingent
deferred sales charge which declines from 3% to zero depending on the period of
time the shares are held. Class B shares will automatically convert to Class A
shares six years after the end of the calendar month of purchase. Class C shares
are subject to a contingent deferred sales charge of 1% on redemptions made
within the first year after purchase. All three classes of shares have identical
voting, dividend, liquidation and other rights, except that each class bears
different distribution expenses and has exclusive voting rights with respect to
its distribution plan. The financial statements have been prepared in conformity
with accounting principles generally accepted in the United States, which
require management to make certain estimates and assumptions that affect the
reported amounts of assets and liabilities in the financial statements and
amounts of income and expenses during the reporting period. Actual results could
differ from those estimates. Additional information about some of the items
discussed in these Notes to Financial Statements is contained in the Fund's
Statement of Additional Information, which is available upon request. The
following is a summary of significant accounting policies followed by the Fund.
1. Security Valuation
In accordance with Pricing Policies adopted by the Board of Directors of the
Fund (the "Pricing Policies") and applicable law, portfolio securities are
valued at current market value or at fair value. The Board of Directors has
delegated to the Adviser, subject to the Board's continuing oversight, certain
responsibilities with respect to the implementation of the Pricing Policies.
Pursuant to the Pricing Policies, securities for which market quotations are
readily available are valued at their current market value. In general, the
market value of these securities is determined as follows:
Securities listed on a national securities exchange or on a foreign securities
exchange are valued at the last sale price at the close of the exchange or
foreign securities exchange. If there has been no sale on such day, the
securities are valued at the mean of the closing bid and asked prices on such
day. If no bid or asked prices are quoted on such day, then the security is
valued in good faith at fair value in accordance with the Pricing Policies.
Securities listed on more than one exchange are valued by reference to the
principal exchange on which the securities are traded; securities not listed on
an exchange but traded on The
- --------------------------------------------------------------------------------
16 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
Nasdaq Stock Market, Inc. ("NASDAQ") are valued in accordance with the NASDAQ
Official Closing Price; listed put or call options are valued at the last sale
price. If there has been no sale on that day, such securities will be valued at
the closing bid prices on that day; open futures contracts and options thereon
are valued using the closing settlement price or, in the absence of such a
price, the most recent quoted bid price. If there are no quotations available
for the day of valuations, the last available closing settlement price is used;
securities traded in the over-the-counter market,(but excluding securities
traded on NASDAQ) are valued at the mean of the current bid and asked prices as
reported by the National Quotation Bureau or other comparable sources; U.S.
Government securities and other debt instruments having 60 days or less
remaining until maturity are valued at amortized cost if their original maturity
was 60 days or less, or by amortizing their fair value as of the 61st day prior
to maturity if their original term to maturity exceeded 60 days; fixed-income
securities, including mortgage backed and asset backed securities, may be valued
on the basis of prices provided by a pricing service or at a price obtained from
one or more of the major broker/dealers. In cases where broker/dealer quotes are
obtained, the Pricing Policies provide that the Adviser may establish procedures
whereby changes in market yields or spreads are used to adjust, on a daily
basis, a recently obtained quoted price on a security; and OTC and other
derivatives are valued on the basis of a quoted bid price or spread from a major
broker/dealer in such security. Securities for which market quotations are not
readily available are valued at fair value in accordance with the Pricing
Policies.
2. Taxes
It is the Fund's policy to meet the requirements of the Internal Revenue Code
applicable to regulated investment companies and to distribute all of its
investment company taxable income and net realized gains, if any, to
shareholders. Therefore, no provisions for federal income or excise taxes are
required.
3. Investment Income and Investment Transactions
Interest income is accrued daily. Dividend income is recorded on the ex-dividend
date. Investment transactions are accounted for on the date securities are
purchased or sold. Investment gains and losses are determined on the identified
cost basis. The Fund accretes discount as an adjustment to interest income.
Additionally, the Fund amortizes premium on debt securities for financial
statement reporting purposes only.
4. Income and Expenses
All income earned and expenses incurred by the Fund are borne on a pro-rata
basis by each settled class of shares, based on the proportionate interest in
the Fund represented by the shares of such class, except that the Fund's Class B
and Class C shares bear higher distribution and transfer agent fees than Class A
shares.
- --------------------------------------------------------------------------------
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 17
5. Dividends and Distributions
Dividends and distributions to shareholders are recorded on the ex-dividend
date. Income dividends and capital gains distributions are determined in
accordance with federal tax regulations and may differ from those determined in
accordance with accounting principles generally accepted in the United States.
To the extent these differences are permanent, such amounts are reclassified
within the capital accounts based on their federal tax basis treatment;
temporary differences do not require such reclassification.
NOTE B
Advisory Fee and Other Transactions with Affiliates
Under the terms of an investment advisory agreement, the Fund pays Alliance
Capital Management L.P. (the "Adviser") an advisory fee at an annual rate of .75
of 1% of the average daily net assets of the Fund. Such fee is accrued daily and
paid monthly.
Pursuant to the advisory agreement, the Fund paid $140,200 to the Adviser
representing the cost of certain legal and accounting services provided to the
Fund by the Adviser for the year ended August 31, 2003.
The Fund compensates Alliance Global Investor Services, Inc. (AGIS), a
wholly-owned subsidiary of the Adviser, under a Transfer Agency Agreement for
providing personnel and facilities to perform transfer agency services for the
Fund. Such compensation amounted to $197,731 for the year ended August 31, 2003.
For the year ended August 31, 2003, the Fund's expenses were reduced by $234
under an expense offset arrangement with AGIS.
AllianceBernstein Investment Research and Management, Inc. (the "Distributor"),
formerly Alliance Fund Distributors, Inc., a wholly-owned subsidiary of the
Adviser, serves as the distributor of the Fund's shares. The Distributor has
advised the Fund that it has retained front-end sales charges of $24,446 from
the sale of Class A shares and received $5,960, $174,223 and $21,471 in
contingent deferred sales charges imposed upon redemptions by shareholders of
Class A, Class B and Class C shares, respectively, for the year ended August 31,
2003.
NOTE C
Distribution Services Agreement
The Fund has adopted a Distribution Services Agreement (the "Agreement")
pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the
Agreement the Fund pays a distribution fee to the Distributor at an annual rate
of up to .30 of 1% of the average daily net assets attributable to Class A
shares and 1% of the average daily net assets attributable to Class B and Class
C shares. The fees are accrued daily and paid monthly. The Agreement provides
that the Dis-
- --------------------------------------------------------------------------------
18 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
tributor will use such payments in their entirety for distribution assistance
and promotional activities. The Distributor has advised the Fund that it has
incurred expenses in excess of the distribution costs reimbursed by the Fund in
the amount of $4,792,673 and $2,311,391 for Class B and Class C shares,
respectively; such costs may be recovered from the Fund in future periods so
long as the Agreement is in effect. In accordance with the Agreement, there is
no provision for recovery of unreimbursed distribution costs, incurred by the
Distributor, beyond the current fiscal year for Class A shares. The Agreement
also provides that the Adviser may use its own resources to finance the
distribution of the Fund's shares.
NOTE D
Investment Transactions
Purchases and sales of investment securities (excluding short-term investments)
for the year ended August 31, 2003, were as follows:
Purchases Sales
--------------- ---------------
Investment securities (excluding U.S.
government securities)............... $ 330,017,941 $ 365,554,464
U.S. government securities............. 577,273 581,384
At August 31, 2003, the cost of investments for federal income tax purposes,
gross unrealized appreciation and unrealized depreciation (excluding swap
contracts) are as follows:
Cost.................................................... $ 234,583,130
---------------
Gross unrealized appreciation........................... $ 42,411,183
Gross unrealized depreciation........................... (3,023,190)
---------------
Net unrealized appreciation............................. $ 39,387,993
---------------
1. Swap Agreements
The Fund may enter into swaps on sovereign debt obligations to protect itself
from interest rate fluctuations on the underlying debt instruments and for
investment purposes. A swap is an agreement that obligates two parties to
exchange a series of cash flows at specified intervals based upon or calculated
by reference to changes in specified prices or rates for a specified amount of
an underlying asset. The payment flows are usually netted against each other,
with the difference being paid by one party to the other.
Risks may arise as a result of the failure of the counterparty to the swap
contract to comply with the terms of the swap contract. The loss incurred by the
failure of a counterparty is generally limited to the net interest payment to be
received by the Fund, and/or the termination value at the end of the contract.
Therefore, the Fund considers the creditworthiness of each counterparty to a
swap contract in evaluating potential credit risk. Additionally, risks may arise
from unanticipated movements in interest rates or in the underlying value of the
securities.
- --------------------------------------------------------------------------------
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 19
The Fund records a net receivable or payable on a daily basis for the net
interest income or expense expected to be received or paid in the interest
period. Net interest received or paid on these contracts is recorded as interest
income (or as an offset to interest income). Fluctuations in the value of swap
contracts are recorded for financial statement purposes as a component of net
change in unrealized appreciation/depreciation of investments. Realized gains
and/or losses from terminated swap contracts are included in net realized gain
or loss on investment transactions.
The Fund may enter into credit default swaps. A sell/(buy) in a credit default
swap provides upon the occurrence of a credit event, as defined in the swap
agreement, for the Fund to buy/(sell) from/(to) the Counterparty at par and
take/(deliver) the principal amount (the "Notional Amount") of the referenced
obligation. During the term of the swap agreement, the Fund receives/(pays)
semi-annual fixed interest payments from/(to) the respective Counterparty,
calculated at the agreed upon interest rate applied to the Notional Amount.
Credit default swaps may involve greater risks than if a Fund had invested in
the referenced obligation directly. Credit default swaps are subject to general
market risk, liquidity risk and credit risk. If the Fund is a buyer and no
credit event occurs, it will lose its investment. In addition, the value of the
referenced obligation received by the Fund as a seller if a credit event occurs,
coupled with the periodic payments previously received, may be less than the
full notional value it pays to the buyer, resulting in a loss of value to the
Fund.
2. Reverse Repurchase Agreements
Under a reverse repurchase agreement, the Fund sells securities and agrees to
repurchase them at a mutually agreed upon date and price. At the time the Fund
enters into a reverse repurchase agreement, it will establish a segregated
account with the custodian containing liquid assets having a value at least
equal to the repurchase price.
For the year ended August 31, 2003, the average amount of reverse repurchase
agreements outstanding was $43,084,173 and the daily weighted average interest
rate was 1.22%.
3. Option Transactions
For hedging and investment purposes, the Fund may purchase and write (sell) put
and call options on U.S. and foreign government securities and foreign
currencies that are traded on U.S. and foreign securities exchanges and
over-the-counter markets.
The risk associated with purchasing an option is that the Fund pays a premium
whether or not the option is exercised. Additionally, the Fund bears the risk of
loss of premium and a change in market value should the counterparty not
- --------------------------------------------------------------------------------
20 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
perform under the contract. Put and call options purchased are accounted for in
the same manner as portfolio securities. The cost of securities acquired through
the exercise of call options is increased by premiums paid. The proceeds from
securities sold through the exercise of put options are decreased by the
premiums paid.
When the Fund writes an option, the premium received by the Fund is recorded as
a liability and is subsequently adjusted to the current market value of the
option written. Premiums received from written options which expire unexercised
are recorded by the Fund on the expiration date as realized gains from options
written. The difference between the premium received and the amount paid on
effecting a closing purchase transaction, including brokerage commissions, is
also treated as a realized gain, or if the premium received is less than the
amount paid for the closing purchase transaction, as a realized loss. If a call
option is exercised, the premium received is added to the proceeds from the sale
of the underlying security or currency in determining whether the Fund has a
realized gain or loss. If a put option is exercised, the premium received
reduces the cost basis of the security or currency purchased by the Fund. In
writing an option, the Fund bears the market risk of an unfavorable change in
the price of the security or currency underlying the written option. Exercise of
an option written by the Fund could result in the Fund selling or buying a
security or currency at a price different from the current market value.
Transactions in options written for the year ended August 31, 2003 were as
follows:
Number of Premiums
Contracts Received
--------------- ---------------
Options outstanding at
August 31, 2002........................ -0- $ -0-
Options written........................ 24,318,011 427,263
Options terminated in closing purchase
transactions........................... (16,636,601) (256,395)
Options expired........................ (7,681,410) (170,868)
--------------- ---------------
Options outstanding at
August 31, 2003........................ -0- $ -0-
--------------- ---------------
- --------------------------------------------------------------------------------
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 21
NOTE E
Capital Stock
There are 9,000,000,000 shares of $.001 par value capital stock authorized,
divided into three classes, designated Class A, Class B and Class C shares. Each
class consists of 3,000,000,000 authorized shares. Transactions in capital stock
were as follows:
================================== ==================================
Shares Amount
================================== ==================================
Year Ended Year Ended Year Ended Year Ended
August 31, 2003 August 31, 2002 August 31, 2003 August 31, 2002
---------------------------------------------------------------------
Class A
Shares sold 15,805,963 7,408,459 $ 109,920,861 $ 45,752,765
- ------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends and
distributions 767,001 774,307 5,359,919 4,809,570
- ------------------------------------------------------------------------------------
Shares converted
from Class B 1,081,814 752,632 7,661,897 4,666,315
- ------------------------------------------------------------------------------------
Shares redeemed (14,979,291) (6,726,005) (106,021,261) (41,296,519)
- ------------------------------------------------------------------------------------
Net increase 2,675,487 2,209,393 $ 16,921,416 $ 13,932,131
- ------------------------------------------------------------------------------------
Class B
Shares sold 4,004,147 3,961,357 $ 28,604,474 $ 25,161,520
- ------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends and
distributions 517,733 656,486 3,639,603 4,128,656
- ------------------------------------------------------------------------------------
Shares converted
to Class A (1,070,593) (743,923) (7,661,897) (4,666,315)
- ------------------------------------------------------------------------------------
Shares redeemed (5,118,893) (3,700,767) (36,999,728) (23,076,497)
- ------------------------------------------------------------------------------------
Net increase
(decrease) (1,667,606) 173,153 $ (12,417,548) $ 1,547,364
- ------------------------------------------------------------------------------------
Class C
Shares sold 4,327,340 2,485,082 $ 31,650,442 $ 15,814,450
- -------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends and
distributions 355,635 411,963 2,514,505 2,595,917
- ------------------------------------------------------------------------------------
Shares redeemed (2,747,810) (1,727,056) (20,023,797) (10,767,138)
- ------------------------------------------------------------------------------------
Net increase 1,935,165 1,169,989 $ 14,141,150 $ 7,643,229
- ------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
22 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
NOTE F
Joint Credit Facility
A number of open-end mutual funds managed by the Adviser, including the Fund,
participate in a $500 million revolving credit facility (the "Facility")
intended to provide short-term financing if necessary, subject to certain
restrictions in connection with abnormal redemption activity. Commitment fees
related to the Facility are paid by the participating funds and are included in
miscellaneous expenses in the statement of operations. The Fund did not utilize
the Facility during the year ended August 31, 2003.
NOTE G
Concentration of Risk
Investing in securities of foreign companies and foreign governments involves
special risks which include the possibility of future political and economic
developments which could adversely affect the value of such securities.
Moreover, securities of many foreign companies and foreign governments and their
markets may be less liquid and their prices more volatile than those of
comparable U.S. companies and the United States government. The Fund invests in
the Sovereign Debt Obligations of countries that are considered emerging market
countries at the time of purchase. Therefore, the Fund is susceptible to
governmental factors and economic and debt restructuring developments adversely
affecting the economies of these emerging market countries. In addition, these
debt obligations may be less liquid and subject to greater volatility than debt
obligations of more developed countries.
NOTE H
Distributions to Shareholders
The tax character of distributions paid during the fiscal years ended August 31,
2003 and August 31, 2002 were as follows:
2003 2002
--------------- --------------
Distributions paid from:
Ordinary income................... $ 24,146,583 $ 22,411,441(a)
--------------- --------------
Total taxable distributions.......... 24,146,583 22,411,441
Tax return of capital............. -0- 1,929,877
--------------- --------------
Total distributions paid............. $ 24,146,583 $ 24,341,318
--------------- --------------
- --------------------------------------------------------------------------------
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 23
As of August 31, 2003, the components of accumulated earnings/(deficit) on a tax
basis were as follows:
Accumulated capital and other losses................... $ (47,109,285)(b)
Unrealized appreciation/(depreciation)................. 42,236,192(c)
--------------
Total accumulated earnings/(deficit)................... $ (4,873,093)
--------------
(a) Total distributions paid differ from the statement of changes in net assets
because for tax purposes dividends are recognized when actually paid.
(b) On August 31, 2003, the Fund had a net capital loss carryforward for federal
income tax purposes of $47,109,285 of which $842,303 expires in the year
2007, $29,154,909 expires in the year 2008, $5,826,966 expires in the year
2009 and $11,285,107 expires in the year 2010. To the extent future capital
gains are offset by capital loss carryforwards, such gains will not be
distributed. During the fiscal year, the Fund utilized capital loss
carryforwards of $15,941,606.
(c) The differences between book-basis and tax-basis unrealized
appreciation/(depreciation) are attributable primarily to the tax deferral
of losses on wash sales and the difference between book and tax amortization
methods for premium.
During the current fiscal year, permanent differences, primarily due to
distributions in excess of net investment income and the tax treatment of bond
premium, resulted in a net decrease in distributions in excess of net investment
income, a net increase in accumulated net realized loss on investment
transactions and a decrease in additional paid-in capital. This reclassification
had no effect on net assets.
NOTE I
Legal Proceedings
Alliance Capital Management L.P., ("Alliance Capital") the Fund's Adviser, has
been contacted by the Office of the New York State Attorney General ("NYAG") and
the United States Securities and Exchange Commission ("SEC") in connection with
their investigation of practices in the mutual fund industry identified as
"market timing" and "late trading" of mutual fund shares. Alliance Capital has
been providing full cooperation with respect to these investigations.
Based on the preliminary results of its own ongoing internal investigation
concerning mutual fund transactions, Alliance Capital has identified conflicts
of interest in connection with certain market timing transactions. In this
regard, Alliance Capital has suspended two of its employees, neither of which
was a portfolio manager or officer of the Fund. Alliance Capital continues to
review the facts and circumstances relevant to the SEC's and NYAG's
investigations, including whether third parties may have engaged in illegal late
trading in the Funds and whether any of its employees knowingly facilitated such
late trading. Consistent with the best interests of the Fund and its
shareholders, Alliance Capital intends to vigorously pursue its rights, and the
rights of the Fund and its shareholders, if it is determined that such trading
occurred. At the present time, management of Alliance Capital is unable to
estimate the impact, if any, that the
- --------------------------------------------------------------------------------
24 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
outcome of these investigations may have on the Fund or Alliance Capital's
results of operations or financial condition.
Alliance Capital also announced that its Board of Directors authorized a special
committee, comprised of the members of Alliance Capital's Audit Committee and
the other independent member of the Board, to direct and oversee a comprehensive
review of the facts and circumstances relevant to the SEC's and the NYAG's
investigations.
On October 2, 2003, a class action complaint entitled Hindo et al. v.
AllianceBernstein Growth & Income Fund et al. (the "Hindo Complaint"), was filed
in federal district court in the Southern District of New York against Alliance
Capital Management Holding L.P.; Alliance Capital ; Alliance Capital Management
Corporation (collectively, the "Alliance Capital defendants"); certain of the
AllianceBernstein Mutual Funds, including the Fund, AXA Financial, Inc.; Gerald
Malone; Charles Schaffran; Edward J. Stern; Canary Capital Partners, LLC; Canary
Investment Management LLC; Canary Capital Partners, Ltd.; and other unnamed
defendants. The action, which is brought on behalf of a putative class of all
persons who purchased shares in one or more of the defendant mutual funds
between October 2, 1998 and September 29, 2003, alleges violations of the
Securities Act of 1933, the Securities Exchange Act of 1934 and the Investment
Advisors Act of 1940. The principal allegations of the Hindo Complaint are that
the Alliance Capital defendants entered into agreements under which certain
named and unnamed parties were permitted to engage in late trading and market
timing transactions in the defendant funds. According to the Complaint, these
agreements were fraudulent and a breach of fiduciary duty to fund shareholders.
In addition, plaintiffs allege that the prospectuses for the named
AllianceBernstein mutual funds were false and misleading because they: (i)
failed to disclose the existence of these late trading and market timing
agreements; and (ii) represented that fund shareholders would be safeguarded
against the effects of such agreements. Plaintiffs seek unspecified damages, the
rescission of plaintiffs' contracts with Alliance Capital, and recovery of any
fees paid in connection therewith. Alliance Capital is evaluating the claims in
the Hindo Complaint and intends to vigorously defend against them. At the
present time, management of Alliance Capital is unable to estimate the impact,
if any, that the outcome of this action may have on the Fund or on Alliance
Capital's results of operations or financial condition. On October 8, 2003, a
similar complaint was filed in federal district court in the Eastern District of
New York in which all AllianceBernstein Funds are named as nominal defendants.
Alliance Capital understands that additional lawsuits that are similar to these
lawsuits have been filed, and believes that others may be filed, against
Alliance Capital defendants, the Funds and related parties.
- --------------------------------------------------------------------------------
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 25
FINANCIAL HIGHLIGHTS
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
========================================================
Class A
========================================================
Year Ended August 31,
-------------------------------------------------------
2003 2002(a) 2001 2000 1999
-------------------------------------------------------
Net asset value, beginning
of period.......................... $ 6.02 $ 6.37 $ 7.06 $ 5.69 $ 5.05
Income From Investment
Operations
Net investment income(b) ............ .69 .69 .85 .75 .71
Net realized and unrealized
gain (loss) on investment
transactions....................... 1.71 (.24) (.76) 1.40 .74
Net increase (decrease) in
net asset value from
operations......................... 2.40 .45 .09 2.15 1.45
Less: Dividends and
Distributions
Dividends from net investment
income............................. (.70) (.74) (.78) (.75) (.74)
Tax return of capital................ -0- (.06) -0- (.03) (.03)
Distributions in excess of
net investment income.............. -0- -0- -0- -0- (.04)
Total dividends and
distributions...................... (.70) (.80) (.78) (.78) (.81)
Net asset value, end of period ...... $ 7.72 $ 6.02 $ 6.37 $ 7.06 $ 5.69
Total Return
Total investment return based
on net asset value(c).............. 41.80% 7.38% 1.55% 39.76% 29.40%
Ratios/Supplemental Data
Net assets, end of period
(000's omitted).................... $118,669 $76,397 $66,750 $66,075 $50,540
Ratio to average net assets of:
Expenses........................... 1.94% 1.88% 2.20% 1.76% 1.59%
Expenses, excluding interest
expense.......................... 1.46% 1.50% 1.47% 1.51% 1.59%
Net investment income.............. 9.73% 11.02% 12.78% 11.59% 12.34%
Portfolio turnover rate.............. 125% 170% 150% 173% 179%
See footnote summary on page 29.
- --------------------------------------------------------------------------------
26 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
========================================================
Class B
========================================================
Year Ended August 31,
-------------------------------------------------------
2003 2002(a) 2001 2000 1999
-------------------------------------------------------
Net asset value, beginning
of period.......................... $ 6.09 $ 6.45 $ 7.14 $ 5.74 $ 5.05
Income From Investment
Operations
Net investment income(b)............. .64 .64 .79 .71 .67
Net realized and unrealized
gain (loss) on investment
transactions....................... 1.73 (.24) (.76) 1.40 .76
Net increase (decrease) in
net asset value from
operations......................... 2.37 .40 .03 2.11 1.43
Less: Dividends and
Distributions
Dividends from net investment
income............................. (.66) (.70) (.72) (.68) (.68)
Tax return of capital................ -0- (.06) -0- (.03) (.03)
Distributions in excess of
net investment income.............. -0- -0- -0- -0- (.03)
Total dividends and
distributions...................... (.66) (.76) (.72) (.71) (.74)
Net asset value, end of period ...... $ 7.80 $ 6.09 $ 6.45 $ 7.14 $ 5.74
Total Return
Total investment return based
on net asset value(c).............. 40.69% 6.50% .63% 38.41% 28.85%
Ratios/Supplemental Data
Net assets, end of period
(000's omitted).................... $89,571 $80,064 $83,706 $108,075 $110,003
Ratio to average net assets of:
Expenses........................... 2.64% 2.58% 2.88% 2.45% 2.31%
Expenses, excluding interest
expense.......................... 2.17% 2.20% 2.17% 2.21% 2.31%
Net investment income.............. 9.07% 10.25% 11.80% 10.85% 11.59%
Portfolio turnover rate.............. 125% 170% 150% 173% 179%
See footnote summary on page 29.
- --------------------------------------------------------------------------------
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 27
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
========================================================
Class C
========================================================
Year Ended August 31,
-------------------------------------------------------
2003 2002(a) 2001 2000 1999
-------------------------------------------------------
Net asset value, beginning
of period............... $ 6.10 $ 6.46 $ 7.15 $ 5.74 $ 5.05
Income From Investment
Operations
Net investment income(b) .63 .64 .79 .71 .67
Net realized and unrealized
gain (loss) on investment
transactions............ 1.75 (.24) (.76) 1.41 .76
Net increase (decrease) in
net asset value from
operations.............. 2.38 .40 .03 2.12 1.43
Less: Dividends and
Distributions
Dividends from net investment
income.................. (.66) (.70) (.72) (.68) (.68)
Tax return of capital... -0- (.06) -0- (.03) (.03)
Distributions in excess of
net investment income... -0- -0- -0- -0- (.03)
Total dividends and
distributions........... (.66) (.76) (.72) (.71) (.74)
Net asset value, end of period $ 7.82 $ 6.10 $ 6.46 $ 7.15 $ 5.74
Total Return
Total investment return based
on net asset value(c)... 40.80% 6.50% .63% 38.58% 28.85%
Ratios/Supplemental Data
Net assets, end of period
(000's omitted)......... $73,477 $45,527 $40,667 $48,960 $39,024
Ratio to average net assets of:
Expenses.............. 2.63% 2.56% 2.87% 2.45% 2.30%
Expenses, excluding interest
expense............... 2.16% 2.19% 2.16% 2.20% 2.30%
Net investment income. 8.91% 10.16% 11.81% 10.78% 11.56%
Portfolio turnover rate. 125% 170% 150% 173% 179%
See footnote summary on page 29.
- --------------------------------------------------------------------------------
28 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
(a) As required, effective September 1, 2001, the Fund has adopted the
provisions of the AICPA Audit and Accounting Guide, Audits of Investment
Companies, and began amortizing premium on debt securities for financial
statement reporting purposes only. For the year ended August 31, 2002, the
effect of this change to Class A, B and C was to decrease net investment
income per share by $.01 and decrease net realized and unrealized loss on
investment transactions per share by $.01. Consequently, the ratio of net
investment income to average net assets was decreased from 11.10% to 11.02%
for Class A, from 10.34% to 10.25% for Class B and from 10.24% to 10.16% for
Class C. Per share, ratios and supplemental data for periods prior to
September 1, 2001 have not been restated to reflect this change in
presentation.
(b) Based on average shares outstanding.
(c) Total investment return is calculated assuming an initial investment made at
the net asset value at the beginning of the year, reinvestment of all
dividends and distributions at net asset value during the year, and
redemption on the last day of the year. Initial sales charge or contingent
deferred sales charge is not reflected in the calculation of total
investment return. Total return does not reflect the deduction of taxes that
a shareholder would pay on Fund distributions or the redemption of Fund
shares. Total investment return calculated for a period of less than one
year is not annualized.
- --------------------------------------------------------------------------------
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 29
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
To the Shareholders and Board of Directors of AllianceBernstein Emerging Market
Debt Fund, Inc.
We have audited the accompanying statement of assets and liabilities of
AllianceBernstein Emerging Market Debt Fund, Inc. (formerly, Alliance Emerging
Market Debt Fund, Inc.) (the "Fund"), including the portfolio of investments, as
of August 31, 2003, and the related statement of operations for the year then
ended, the statement of changes in net assets for each of the two years in the
period then ended, and the financial highlights for each of the five years in
the period then ended. These financial statements and financial highlights are
the responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements and financial highlights. Our procedures included
confirmation of securities owned as of August 31, 2003, by correspondence with
the custodian and others. 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
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND, Inc. at August 31, 2003, the
results of its operations for the year then ended, the changes in its net assets
for each of the two years in the period then ended, and the financial highlights
for each of the five years in the period then ended, in conformity with
accounting principles generally accepted in the United States.
New York, New York
October 10, 2003
- --------------------------------------------------------------------------------
30 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
BOARD OF DIRECTORS
John D. Carifa, Chairman
Ruth Block(1)
David H. Dievler(1)
John H. Dobkin(1)
William H. Foulk, Jr.(1)
Clifford L. Michel(1)
Donald J. Robinson(1)
OFFICERS
John D. Carifa, Chairman and President
Kathleen A. Corbet, Senior Vice President
Paul J. DeNoon(2), Vice President
Edmund P. Bergan, Jr., Secretary
Mark D. Gersten, Treasurer and Chief Financial Officer
Vincent S. Noto, Controller
Principal Underwriter
AllianceBernstein Investment Research and Management, Inc.
1345 Avenue of the Americas
New York, NY 10105
Custodian
The Bank of New York
One Wall Street
New York, NY 10286
Legal Counsel
Seward & Kissel LLP
One Battery Park Plaza
New York, NY 10004
Transfer Agent
Alliance Global Investor Services, Inc.
P.O. Box 1520
Secaucus, NJ 07096-1520
Toll-Free (800) 221-5672
Independent Auditors
Ernst & Young LLP
5 Times Square
New York, NY 10036
(1) Member of the Audit Committee.
(2) Mr. DeNoon is the person primarily responsible for the day-to-day management
of the Fund's investment portfolio.
- --------------------------------------------------------------------------------
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 31
MANAGEMENT OF THE FUND
Board of Directors Information
The business and affairs of the Fund are managed under the direction of the
Board of Directors. Certain information concerning the Fund's Directors is set
forth below.
PORTFOLIOS
IN FUND OTHER
NAME, AGE OF DIRECTOR, PRINCIPAL COMPLEX DIRECTORSHIP
ADDRESS OCCUPATION(S) OVERSEEN BY HELD BY
(YEARS OF SERVICE*) DURING PAST 5 YEARS DIRECTOR DIRECTOR
- ---------------------------------------------------------------------------------------------------------------------------
INTERESTED DIRECTOR
John D. Carifa,**, 58 President, Chief Operating Officer 116 None
1345 Avenue of the and a Director of Alliance Capital
Americas Management Corporation
New York, NY 10105 ("ACMC"), with which he has been
(9) associated since prior to 1998.
DISINTERESTED DIRECTORS
Ruth Block,#+, 72 Formerly Executive Vice 97 None
500SE Mizner Blvd. President and Chief Insurance
Boca Raton, FL 33432 Officer of The Equitable Life
(9) Assurance Society of the United
States; Chairman and Chief
Executive Officer of Evlico; Director
of Avon, BP (oil and gas), Ecolab
Incorporated (specialty chemicals),
Tandem Financial Group, and
Donaldson Lufkin & Jenrette
Securities Corporation. Former
Governor at Large National
Association of Securities Dealers,
Inc.
David H. Dievler,#+, 74 Independent consultant. Until 101 None
P.O. Box 167 December 1994, he was Senior
Spring Lake, NJ 07762 Vice President of ACMC responsible
(9) for mutual fund administration.
Prior to joining ACMC in 1984,
he was Chief Financial Officer of
Eberstadt Asset Management since
1968. Prior to that, he was Senior
Manager at Price Waterhouse & Co.
Member of American Institute of
Certified Public Accountants since
1953.
John H. Dobkin,#+, 61 Consultant. Formerly President of 98 None
P.O. Box 12 Save Venice, Inc. (preservation
Annandale, NY 12504 organization) from 2001-2002.
(9) Formerly a Senior Advisor from
June 1999-June 2000 and
President of Historic Hudson
Valley (historic preservation) from
December 1989-May 1999.
Previously, Director of the National
Academy of Design and during
1988-1992, Director and Chairman of the
Audit Committee of ACMC.
- --------------------------------------------------------------------------------
32 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
PORTFOLIOS
IN FUND OTHER
NAME, AGE OF DIRECTOR, PRINCIPAL COMPLEX DIRECTORSHIP
ADDRESS OCCUPATION(S) OVERSEEN BY HELD BY
(YEARS OF SERVICE*) DURING PAST 5 YEARS DIRECTOR DIRECTOR
- ---------------------------------------------------------------------------------------------------------------------------
DISINTERESTED DIRECTORS
(continued)
William H. Foulk, Jr.,#+, 71 Investment Adviser and an 113 None
2 Sound View Drive independent consultant. Formerly
Suite 100 Senior Manager of Barrett
Greenwich, CT 06830 Associates, Inc., a registered
(9) investment adviser, with which he
had been associated since prior
to 1998. He was formerly Deputy
Comptroller of the State of New
York and, prior thereto, Chief
Investment Officer of the New
York Bank for Savings.
Clifford L. Michel,#+, 64 Senior Counsel of the law firm of 97 Placer
15 St. Bernard's Road Cahill Gordon & Reindel since Dome, Inc.
Gladstone, NJ 07934 February 2001 and a partner of
(9) that firm for more than 25 years
prior thereto. President and Chief
Executive Officer of Wenonah
Development Company
(investments) and a Director
of Placer Dome, Inc. (mining).
Donald J. Robinson,#+ 69 Senior Counsel to the law firm of 96 None
98 Hell's Peak Road Orrick, Herrington & Sutcliffe LLP
Weston, VT 05161 since prior to 1998. Formerly a
(7) senior partner and a member of
the Executive Committee of that
firm. He was also a member
and Chairman of the Municipal
Securities Rulemaking Board
and a Trustee of the Museum
of the City of New York.
* There is no stated term of office for the Fund's Directors.
** Mr. Carifa is an "interested director", as defined in the 1940 Act, due to
his position as President and Chief Operating Officer of ACMC, the Fund's
investment adviser.
# Member of the Audit Committee.
+ Member of the Nominating Committee.
- --------------------------------------------------------------------------------
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 33
Officers of the Fund
Certain information concerning the Fund's Officers is listed below.
POSITION(S) PRINCIPAL OCCUPATION
NAME AND AGE HELD WITH FUND DURING PAST 5 YEARS
- ------------------------------------------------------------------------------------------------------------
John D. Carifa, 58 Chairman and President See biography above.
Kathleen A. Corbet, 43 Senior Vice President Executive Vice President of ACMC**,
with which she has been associated
since prior to 1998.
Paul J. DeNoon, 41 Vice President Senior Vice President of ACMC**,
with which he has been associated
since prior to 1998.
Edmund P. Bergan, Jr., 53 Secretary Senior Vice President and General
Counsel of AllianceBernstein
Investment Research and Management,
Inc. ("ABIRM")** and Alliance Global
Investor Services, Inc. ("AGIS")**, with
which he has been associated since prior
to 1998.
Mark D. Gersten, 53 Treasurer and Chief Senior Vice President of AGIS** and a
Financial Officer Vice President of ABIRM**, with which
he has been associated since prior to
1998.
Vincent S. Noto, 38 Controller Vice President of AGIS**, with which he
has been associated since prior to 1998.
* The address for each of the Fund's Officers is 1345 Avenue of the Americas,
New York, NY 10105.
** ACMC, ABIRM and AGIS are affiliates of the Fund.
The Fund's Statement of Additional Information ("SAI") has additional
information about the Fund's Directors and officers and is available without
charge upon request. Contact your financial representative or Alliance
Capital at 800-227-4618 for a free prospectus or SAI.
- --------------------------------------------------------------------------------
34 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
ALLIANCEBERNSTEIN FAMILY OF FUNDS
Wealth Strategies Funds
Balanced Wealth Strategy
Wealth Appreciation Strategy
Wealth Preservation Strategy
Tax-Managed Balanced Wealth Strategy
Tax-Managed Wealth Appreciation Strategy*
Tax-Managed Wealth Preservation Strategy**
Blended Style Series
U.S. Large Cap Portfolio
Growth Funds
Domestic
Growth Fund
Health Care Fund
Mid-Cap Growth Fund
Premier Growth Fund
Small Cap Growth Fund+
Technology Fund
Global & International
All-Asia Investment Fund
Global Small Cap Fund
Greater China '97 Fund
International Premier Growth Fund
New Europe Fund
Worldwide Privatization Fund
Select Investor Series
Biotechnology Portfolio
Premier Portfolio
Technology Portfolio
Value Funds
Domestic
Balanced Shares
Disciplined Value Fund
Growth & Income Fund
Real Estate Investment Fund
Small Cap Value Fund
Utility Income Fund
Value Fund
Global & International
Global Value Fund
International Value Fund
Taxable Bond Funds
Americas Government Income Trust
Corporate Bond Portfolio
Emerging Market Debt Fund
Global Strategic Income Trust
High Yield Fund
Multi-Market Strategy Trust
Quality Bond Portfolio
Short Duration Portfolio
U.S. Government Portfolio
Municipal Bond Funds
National
Insured National
Arizona
California
Insured California
Florida
Massachusetts
Michigan
Minnesota
New Jersey
New York
Ohio
Pennsylvania
Virginia
Intermediate Municipal Bond Funds
Intermediate California
Intermediate Diversified
Intermediate New York
Closed-End Funds
All-Market Advantage Fund
ACM Income Fund
ACM Government Opportunity Fund
ACM Managed Dollar Income Fund
ACM Managed Income Fund
ACM Municipal Securities Income Fund
California Municipal Income Fund
National Municipal Income Fund
New York Municipal Income Fund
The Spain Fund
World Dollar Government Fund
World Dollar Government Fund II
We also offer Exchange Reserves,++ which serves as the money market fund
exchange vehicle for the AllianceBernstein mutual funds.
For more complete information on any AllianceBernstein mutual fund, including
investment objectives and policies, sales charges, expenses, risks and other
matters of importance to prospective investors, visit our web site at
www.alliancebernstein.com or call us at (800) 227-4616 for a current prospectus.
Please read the prospectus carefully before you invest or send money.
* Formerly Growth Investors Fund.
** Formerly Conservative Investors Fund.
+ Quasar Fund changed its name to Small Cap Growth Fund on 11/1/03.
++ An investment in the Fund is not a deposit in a bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
government agency. Although the Fund seeks to preserve the value of your
investment at $1.00 per share, it is possible to lose money by investing in
the Fund.
- --------------------------------------------------------------------------------
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 35
NOTES
- --------------------------------------------------------------------------------
36 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
1345 Avenue of the Americas
New York, NY 10105
(800) 221-5672
[LOGO] ALLIANCEBERNSTEIN(SM)
Investment Research & Management
SM This service mark used under license from the owner, Alliance Capital
Management L.P.
GDGAR0803
ITEM 2. CODE OF ETHICS.
(a) The registrant has adopted a code of ethics that applies to its principal
executive officer, principal financial officer and principal accounting officer.
A copy of the registrant's code of ethics is filed herewith as Exhibit 10(a)(1).
(b) During the period covered by this report, no amendments were made to the
provisions of the code of ethics adopted in 2(a) above.
(c) During the period covered by this report, no implicit or explicit waivers to
the provisions of the code of ethics adopted in 2(a) above were granted.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
The registrant's Board of Directors has determined that independent directors
Messrs. David H. Dievler and William H. Foulk qualify as audit committee
financial experts.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Form N-CSR disclosure requirement not yet effective with respect to the
registrant.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable to the registrant.
ITEM 6. [RESERVED]
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable to the registrant.
ITEM 8. [RESERVED]
ITEM 9. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive officer and principal financial officer
have concluded that the registrant's disclosure controls and procedures (as
defined in Rule 30a-2(c) under the Investment Company Act of 1940, as amended)
are effective at the reasonable assurance level based on their evaluation of
these controls and procedures as of a date within 90 days of the filing date of
this document.
(b) There were no significant changes in the registrant's internal controls that
could significantly affect these controls subsequent to the date of their
evaluation, including any corrective actions with regard to significant
deficiencies and material weaknesses.
ITEM 10. EXHIBITS.
The following exhibits are attached to this Form N-CSR:
Exhibit No. DESCRIPTION OF EXHIBIT
10 (a) (1) Code of ethics that is subject to the disclosure of Item 2
hereof
10 (b) (1) Certification of Principal Executive Officer Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002
10 (b) (2) Certification of Principal Financial Officer Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002
10 (c) Certification of Principal Executive Officer and Principal
Financial Officer Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
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): AllianceBernstein Emerging Market Debt Fund, Inc.
By: /s/John D. Carifa
---------------------------------
John D. Carifa
President
Date: October 30, 2003
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: /s/John D. Carifa
---------------------------------
John D. Carifa
President
Date: October 30, 2003
By: /s/Mark D. Gersten
-------------------------------
Mark D. Gersten
Treasurer and Chief Financial Officer
Date: October 30, 2003