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: 811-09687
ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME 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)
Mark R. Manley
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: November 30, 2004
Date of reporting period: November 30, 2004
ITEM 1. REPORTS TO STOCKHOLDERS.
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Large-Cap Value
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[LOGO]AllianceBernstein (SM)
Investment Research and Management
AllianceBernstein Focused Growth & Income Fund
Annual Report -- November 30, 2004
Investment Products Offered
- ---------------------------
o Are Not FDIC Insured
o May Lose Value
o Are Not Bank Guaranteed
- ---------------------------
The investment return and principal value of an investment in the Fund will
fluctuate as the prices of the individual securities in which it invests
fluctuate, so that your shares, when redeemed, may be worth more or less than
their original cost. You should consider the investment objectives, risks,
charges and expenses of the Fund carefully before investing. For a free copy of
the Fund's prospectus, which contains this and other information, visit our web
site at www.alliancebernstein.com or call your financial advisor or
AllianceBernstein at (800) 227-4618. Please read the prospectus carefully
before you invest.
You may obtain performance information current to the most recent month-end by
visiting www.alliancebernstein.com.
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, and information regarding how the Fund voted proxies relating to
portfolio securities during the most recent 12-month period ended June 30,
without charge. Simply visit AllianceBernstein's web site at
www.alliancebernstein.com, or go to the Securities and Exchange Commission's
(the "Commission") web site at www.sec.gov, or call AllianceBernstein at (800)
227-4618.
The Fund files its complete schedule of portfolio holdings with the Commission
for the first and third quarters of each fiscal year on Form N-Q. The Fund's
Forms N-Q are available on the Commission's web site at www.sec.gov. The Fund's
Forms N-Q may also 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 (800) SEC-0330. AllianceBernstein publishes
full portfolio holdings for the Fund monthly at www.alliancebernstein.com.
AllianceBernstein Investment Research and Management, Inc. is an affiliate of
Alliance Capital Management L.P., the manager of the funds, and is a member of
the NASD.
January 28, 2005
Annual Report
This report provides management's discussion of fund performance for
AllianceBernstein Focused Growth & Income Fund, formerly AllianceBernstein
Disciplined Value Fund, (the "Fund") for the annual reporting period ended
November 30, 2004.
Investment Objective and Policies
This open-end fund invests primarily in the equity securities of U.S. companies
that Alliance believes are undervalued. The Fund's investment objective is
long-term growth of capital through the application of a disciplined
value-oriented investment process. The Fund expects, under normal
circumstances, to invest primarily in equity securities of about 75 U.S.
companies. The Fund may also invest up to 15% of its total assets in non-U.S.
companies.
Investment Results
The table on page 5 provides performance data for the Fund and its benchmark,
the Russell 1000 Value Index, for the six- and 12-month periods ended November
30, 2004. Also included in the table are returns for the Fund's peer group, as
represented by the Lipper Multi-Cap Core Funds Average (the "Lipper Average").
Funds in the Lipper Average have generally similar investment objectives to the
Fund, although some may have different investment policies and sales and
management fees.
The Fund underperformed its benchmark, the Russell 1000 Value Index, and the
Lipper Average during both the six- and 12-month periods ended November 30,
2004. The Fund's underweighted positions in the strongest performing Russell
1000 Value Index sectors were primarily responsible for its underperformance
during the six- and 12-month periods ended November 30, 2004.
Fund performance proved disappointing as our perception of relative value
resulted in the Fund being underweighted in stock sectors of the Russell 1000
Value Index that performed best during the annual reporting period ended
November 30, 2004. Specifically, as a result of high valuations, the Fund had
an underweighted position in basic materials, financials (e.g., regional
banks), and was void of utilities (e.g., telecommunication services and
electricity generation). The premature reduction in the Fund's energy
investments also contributed to recent weak relative performance. Also,
individual stock selection was less effective than last year, as the Fund's
investments in media and pharmaceutical companies weighed on performance. By
way of internal performance attribution analysis, the Fund's sector decisions
contributed approximately two-thirds of performance shortfall versus its
benchmark during both the six- and 12-month reporting periods.
During the six-month reporting period ended November 30, 2004, the Russell 1000
Value Index was the best performing large company index; therefore, it proved
to be extremely difficult to beat. In fact, with the exception of the second
quarter of 2004, the Russell 1000 Value Index outperformed the broad market in
every quarter since March 2003, and substantially outperformed the broad market
since early 2000. The deepest value (e.g., the
_______________________________________________________________________________
ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND o 1
lowest price-to-book value stocks) portion of the Russell 1000 Value Index
performed best, dramatically outperforming the highest price-to-book value
stocks during the semi-annual reporting period. As interest rates moved lower
and commodity prices moved higher, it was the low price-to-book value stocks
that led the Russell 1000 Value Index's performance charge.
Market Review and Investment Strategy
Within the equity markets, valuation differentials between individual companies
were quite narrow. As the spread between the cheapest and most expensive stocks
remained compressed--not only between sectors but also within industries--the
valuation opportunity, as the management team measured it, became limited.
Thus, it became increasingly difficult to distinguish potential winners from
losers. Furthermore, investors had been acting in tandem to an unusual degree,
reacting apparently en masse to broad threats and opportunities, rather than
staking out positions on the fundamentals of individual stocks. As a result,
sector allocation rather than stock selection was the primary driver of
portfolio returns for most of the annual reporting period. This did not play to
the management team's strong suit as value managers emphasizing research-driven
stock selection.
Our search for value in a period of tightening valuation spreads sent us down
two diametrically opposed paths over the past several years. At the end of
2002, we began to focus on technology and high-beta names that had been
underperforming for most of the prior year in the run-up to the Iraq war, when
investor risk aversion was high. We considered the downdraft in these stocks
overdone, based on research indicating that the companies' fundamentals were
likely to hold up better-than-expected and that they would be beneficiaries of
easing credit conditions and an improving economic backdrop. These stocks
soared when the economy strengthened and credit spreads narrowed in 2003, which
contributed to the Fund's strong performance. The rally in these stocks was so
vigorous that, by mid-2003, the best opportunities emerged in large-cap quality
companies that had been left behind. However, we remained confident that our
strategy of emphasizing large-cap quality names would ultimately prevail.
The securities we bought and sold for the Fund during the period under review
were selected, as they always are, within the framework of our proprietary
relative value investment process. For each of the large number of companies
covered by AllianceBernstein's fundamental research analysts, we systematically
compared the relationship of a company's securities valuation to its forecast
fundamental performance. The attractiveness of each security in the closely
followed research universe was summarized by ranking stocks based on relative
valuation and relative earnings estimate revision factors. In combination, we
believed these factors provided a useful summary of relative stock price
attractiveness based on traditional fundamental research activities and
provided an excellent foundation for the Fund's investment decisions.
_______________________________________________________________________________
2 o ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND
While our definition of value was constant, the perception of value depended on
how the market was trading off the importance between the moving parts of the
ranking system-relative valuation, relative earnings, and relative price. As
the Fund responded to shifts in the ranking system's perception of value, we
expected its characteristics to consistently capture a very attractive
relationship between portfolio valuation and prospective earnings growth.
In Memory
It is with sadness that we announce the passing of Clifford L. Michel, a member
of the Board of Directors of AllianceBernstein Focused Growth & Income Fund.
Mr. Michel served the interests of the Fund's shareholders for the last five
years. His hard work, dedication and contributions to the Fund will be greatly
missed.
_______________________________________________________________________________
ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND o 3
Historical Performance
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HISTORICAL PERFORMANCE
An Important Note About the Value of Historical Performance
The performance shown on the following pages represents past performance and
does not guarantee future results. Current performance may be lower or higher
than the performance information shown. You may obtain performance information
current to the most recent month-end by visiting www.alliancebernstein.com.
The investment return and principal value of an investment in the Fund will
fluctuate, so that your shares, when redeemed, may be worth more or less than
their original cost. You should consider the investment objectives, risks,
charges and expenses of the Fund carefully before investing. For a free copy of
the Fund's prospectus, which contains this and other information, visit our web
site at www.alliancebernstein.com or call your financial advisor or
AllianceBernstein at (800) 227-4618. You should read the prospectus carefully
before you invest.
Returns are annualized for periods longer than one year. All fees and expenses
related to the operation of the Fund have been deducted. NAV returns do not
reflect sales charges; if sales charges were reflected, the Fund's quoted
performance would be lower. SEC returns reflect the applicable sales charges
for each share class: a 4.25% maximum front-end sales charge for Class A
shares; the applicable contingent deferred sales charge for Class B shares (4%
year 1, 3% year 2, 2% year 3, 1% year 4); a 1% 1 year contingent deferred sales
charge for Class C shares. Returns for Class R Class shares will vary due to
different expenses associated with this class. Performance assumes reinvestment
of distributions and does not account for taxes.
Benchmark Disclosure
The unmanaged Russell 1000 Value Index does not reflect fees and expenses
associated with the active management of a mutual fund portfolio. The Index
contains those securities in the Russell 1000 Index with a less-than-average
growth orientation. The Russell 1000 Index is comprised of 1000 of the largest
capitalized companies that are traded in the United States. For the six- and
12-month periods ended November 30, 2004, the Lipper Multi-Cap Core Funds
Average consisted of 779 and 699 funds, respectively. Funds in the Lipper
Average have generally similar investment objectives to AllianceBernstein
Focused Growth & Income Fund, although some may have different investment
policies and sales and management fees. An investor cannot invest directly in
an index or average, and their results are not indicative of the performance
for any specific investment, including the Fund.
A Word About Risk
The Fund can invest in foreign securities, which may magnify fluctuations due
to changes in foreign exchange rates and the possibility of substantial
volatility due to political and economic uncertainties in foreign countries.
The Fund can invest in small- to mid-capitalization companies. These
investments may be more volatile than investments in large-capitalization
companies. The Fund may at times be concentrated in a particular sector or
industry group and, therefore, may be subject to greater risk. While the Fund
invests principally in common stocks and other equity securities, in order to
achieve its investment objectives, the Fund may at times use certain types of
investment derivatives, such as options, futures, forwards and swaps. These
instruments involve risks different from, and in certain cases, greater than,
the risks presented by more traditional investments. These risks are fully
discussed in the Fund's prospectus.
(Historical Performance continued on next page)
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4 o ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND
Historical Performance
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HISTORICAL PERFORMANCE
(continued from previous page)
Returns
THE FUND VS. ITS BENCHMARK -------------------------
PERIODS ENDED NOVEMBER 30, 2004 6 Months 12 Months
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AllianceBernstein Focused Growth & Income Fund
Class A 2.51% 10.70%
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Class B 2.16% 9.91%
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Class C 2.16% 9.91%
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Class R 2.37% 10.48%
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Russell 1000 Value Index 11.01% 19.67%
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Lipper Multi-Cap Core Funds Average 6.06% 11.52%
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GROWTH OF A $10,000 INVESTMENT IN THE FUND
12/22/99* TO 11/30/04
AllianceBernstein Focused Growth & Income Fund Class A: $14,161
Russell 1000 Value Index: $12,770
[THE FOLLOWING TABLE WAS DEPICTED BY A MOUNTAIN CHART IN THE PRINTED MATERIAL.]
AllianceBernstein
Focused Growth & Income Russell 1000
Fund Class A Value Index
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12/22/99* $ 9,575 $ 10,000
11/30/00 $ 10,935 $ 10,403
11/30/01 $ 12,619 $ 10,077
11/30/02 $ 10,460 $ 9,108
11/30/03 $ 12,792 $ 10,671
11/30/04 $ 14,161 $ 12,770
* Since inception of the Fund's Class A shares on 12/22/99.
This chart illustrates the total value of an assumed $10,000 investment in
AllianceBernstein Focused Growth & Income Fund Class A shares (from 12/22/99*
to 11/30/04) as compared to the performance of its benchmark, the Russell 1000
Value Index. 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.
See Historical Performance and Benchmark disclosures on previous page.
(Historical Performance continued on next page)
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ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND o 5
Historical Performance
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HISTORICAL PERFORMANCE
(continued from previous page)
AVERAGE ANNUAL RETURNS AS OF NOVEMBER 30, 2004
- --------------------------------------------------------------
NAV Returns SEC Returns
Class A Shares
1 Year 10.70% 5.99%
Since Inception* 8.24% 7.30%
Class B Shares
1 Year 9.91% 5.91%
Since Inception* 7.50% 7.50%
Class C Shares
1 Year 9.91% 8.91%
Since Inception* 7.49% 7.49%
Class R
1 Year 10.48%
Since Inception* 10.57%
SEC AVERAGE ANNUAL RETURNS (WITH SALES CHARGES)
AS OF THE MOST RECENT CALENDAR QUARTER-END (DECEMBER 31, 2004)
- --------------------------------------------------------------
Class A Shares
1 Year 4.23%
5 Year 7.58%
Since Inception* 8.25%
Class B Shares
1 Year 4.08%
5 Year 7.79%
Since Inception* 8.44%
Class C Shares
1 Year 7.09%
5 Year 7.77%
Since Inception* 8.43%
* Inception dates: 12/22/99 for Class A, B and C shares; 11/3/03 for Class R
shares.
See Historical Performance disclosures on page 4.
_______________________________________________________________________________
6 o ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND
Fund Expenses
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FUND EXPENSES
As a shareholder of the Fund, you incur two types of costs: (1) transaction
costs, including sales charges (loads) on purchase payments, contingent
deferred sales charges on redemptions and (2) ongoing costs, including
management fees; distribution (12b-1) fees; and other Fund expenses. This
example is intended to help you understand your ongoing costs (in dollars) of
investing in the Fund and to compare these costs with the ongoing costs of
investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of
the period and held for the entire period as indicated below.
Actual Expenses
The first line of the table below provides information about actual account
values and actual expenses. You may use the information in this line, together
with the amount you invested, to estimate the expenses that you paid over the
period. Simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.6), then multiply the result by the number
in the first line under the heading entitled "Expenses Paid During Period" to
estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line of the table below provides information about hypothetical
account values and hypothetical expenses based on the Fund's actual expense
ratio and an assumed annual rate of return of 5% before expenses, which is not
the Fund's actual return. The hypothetical account values and expenses may not
be used to estimate the actual ending account balance or expenses you paid for
the period. You may use this information to compare the ongoing costs of
investing in the Fund and other funds by comparing this 5% hypothetical example
with the 5% hypothetical examples that appear in the shareholder reports of
other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as sales
charges (loads), or contingent deferred sales charges on redemptions.
Therefore, the second line of the table is useful in comparing ongoing costs
only, and will not help you determine the relative total costs of owning
different funds. In addition, if these transactional costs were included, your
costs would have been higher.
Ending
Beginning Account Value
Account Value November 30, Expenses Paid
June 1, 2004 2004 During Period*
- -----------------------------------------------------------------------------------------------
Class A
Actual $1,000 $1,025.13 $6.18
Hypothetical (5% return before expenses) $1,000 $1,018.90 $6.16
- -----------------------------------------------------------------------------------------------
Class B
Actual $1,000 $1,021.58 $9.86
Hypothetical (5% return before expenses) $1,000 $1,015.25 $9.82
- -----------------------------------------------------------------------------------------------
Class C
Actual $1,000 $1,021.59 $9.75
Hypothetical (5% return before expenses) $1,000 $1,015.35 $9.72
- -----------------------------------------------------------------------------------------------
Class R
Actual $1,000 $1,023.74 $7.34
Hypothetical (5% return before expenses) $1,000 $1,017.75 $7.31
- -----------------------------------------------------------------------------------------------
* Expenses are equal to the classes' annualized expense ratios of 1.22%,
1.95%, 1.93% and 1.45%, respectively, multiplied by the average account value
over the period, multiplied by the number of days in the most recent fiscal
half-year/366 (to reflect the one-half year period).
_______________________________________________________________________________
ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND o 7
Portfolio Summary and Ten Largest Holdings
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PORTFOLIO SUMMARY
November 30, 2004
PORTFOLIO STATISTICS
Net Assets ($mil): $509.4
SECTOR BREAKDOWN*
24.7% Finance
21.8% Health Care
15.6% Consumer Services
8.3% Consumer Staples
7.2% Capital Goods
6.4% Technology [PIE CHART OMITTED]
2.7% Transportation
2.1% Energy
1.6% Basic Industry
0.9% Consumer Manufacturing
8.7% Short-Term
TEN LARGEST HOLDINGS
November 30, 2004
Focused Growth & Income Fund
Percent of
Company U.S. $ Value Net Assets
_______________________________________________________________________________
Time Warner, Inc. $ 22,137,500 4.3%
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Boston Scientific Corp. 20,886,000 4.1
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Microsoft Corp. 20,107,500 3.9
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Viacom, Inc. Cl. B 19,952,500 3.9
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JP Morgan Chase & Co. 19,013,250 3.7
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ACE, Ltd. (Bermuda) 18,189,000 3.6
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American International Group 18,118,100 3.6
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Citigroup, Inc. 17,900,000 3.5
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General Electric Co. 17,680,000 3.5
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UnitedHealth Group, Inc. 16,570,000 3.3
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$190,553,850 37.4%
* All data are as of November 30, 2004. The Fund's sector breakdown is
expressed as a percentage of total investments and may vary over time.
_______________________________________________________________________________
8 o ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND
Portfolio of Investments
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PORTFOLIO OF INVESTMENTS
November 30, 2004
Company Shares U.S. $ Value
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COMMON STOCKS-92.9%
Finance-25.1%
Banking - Money Center-4.6%
JPMorgan Chase & Co. 505,000 $ 19,013,250
Wachovia Corp. 85,000 4,398,750
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23,412,000
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Banking - Regional-2.6%
Bank of America Corp. 200,000 9,254,000
North Fork Bancorporation, Inc.* 146,500 4,219,200
-------------
13,473,200
-------------
Brokerage & Money Management-1.9%
Merrill Lynch & Co., Inc. 175,000 9,749,250
-------------
Insurance-12.5%
ACE, Ltd. (Bermuda) 450,000 18,189,000
American International Group 286,000 18,118,100
Axis Capital Holdings, Ltd. (Bermuda) 500,000 13,030,000
The Allstate Corp. 92,100 4,651,050
XL Capital, Ltd. Cl.A* 125,000 9,420,000
-------------
63,408,150
-------------
Miscellaneous-3.5%
Citigroup, Inc. 400,000 17,900,000
-------------
127,942,600
-------------
Health Care-22.1%
Biotechnology-0.8%
Applera Corp.-Applied Biosystems Group 200,000 4,100,000
-------------
Drugs-7.9%
Forest Laboratories, Inc.(a) 250,000 9,742,500
Pfizer, Inc. 344,200 9,558,434
Watson Pharmaceuticals, Inc.(a)* 250,000 7,262,500
Wyeth 350,000 13,954,500
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40,517,934
-------------
Medical Products-5.2%
Beckman Coulter, Inc.* 87,300 5,714,658
Boston Scientific Corp.(a) 600,000 20,886,000
-------------
26,600,658
-------------
Medical Services-8.2%
Anthem, Inc.(a)* 85,000 8,613,050
HCA Healthcare Corp. 67,000 2,641,140
Health Management Associates, Inc. Cl.A* 225,000 4,970,250
UnitedHealth Group, Inc. 200,000 16,570,000
WellPoint Health Networks, Inc.(a) 70,700 8,844,570
-------------
41,639,010
-------------
112,857,602
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_______________________________________________________________________________
ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND o 9
Portfolio of Investments
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Company Shares U.S. $ Value
- -------------------------------------------------------------------------------
Consumer Services-15.9%
Broadcasting & Cable-12.7%
Clear Channel Communications, Inc. 135,000 $ 4,546,800
Comcast Corp. Cl.A(a) 300,000 9,012,000
Time Warner, Inc.(a) 1,250,000 22,137,500
Viacom, Inc. Cl.B 575,000 19,952,500
Westwood One, Inc.(a) 400,000 8,968,000
-------------
64,616,800
-------------
Restaurants & Lodging-0.3%
Wendy's International, Inc.* 45,300 1,615,851
-------------
Retail - General Merchandise-2.9%
The Home Depot, Inc. 350,000 14,612,500
-------------
80,845,151
-------------
Consumer Staples-8.4%
Alcohol-0.8%
Diageo Plc (ADR) (United Kingdom)* 75,000 4,225,500
-------------
Cosmetics-1.9%
Avon Products, Inc. 255,000 9,572,700
-------------
Food-0.0%
Dean Foods Co.(a) 800 25,336
-------------
Household Products-1.4%
The Procter & Gamble Co. 140,000 7,487,200
-------------
Tobacco-4.3%
Altria Group, Inc. 200,000 11,498,000
Loews Corp. - Carolina Group 350,000 10,290,000
-------------
21,788,000
-------------
43,098,736
-------------
Capital Goods-7.4%
Electrical Equipment-1.5%
Emerson Electric Co. 65,000 4,343,300
Johnson Controls, Inc. 50,000 3,070,000
-------------
7,413,300
-------------
Machinery-1.7%
Ingersoll-Rand Co. Cl.A (Bermuda)* 115,000 8,558,300
-------------
Miscellaneous-4.2%
General Electric Co. 500,000 17,680,000
United Technologies Corp. 40,000 3,903,200
-------------
21,583,200
-------------
37,554,800
-------------
_______________________________________________________________________________
10 o ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND
Portfolio of Investments
- -------------------------------------------------------------------------------
Shares or
Principal
Amount
Company (000) U.S. $ Value
- -------------------------------------------------------------------------------
Technology-6.5%
Computer Services-1.9%
Fiserv, Inc.(a) 250,000 $ 9,627,500
-------------
Computer Software-3.9%
Microsoft Corp. 750,000 20,107,500
-------------
Miscellaneous-0.7%
Molex, Inc. Cl.A(a) 150,000 3,643,500
-------------
33,378,500
-------------
Transportation-2.8%
Railroad-2.8%
Burlington Northern Santa Fe Corp. 105,000 4,729,200
Union Pacific Corp.* 150,000 9,516,000
-------------
14,245,200
-------------
Energy-2.2%
Oil Service-2.2%
EnCana Corp. (Canada)* 100,700 5,742,921
Nabors Industries, Ltd. (Barbados)(a)* 77,100 4,009,200
Schlumberger, Ltd. 20,000 1,312,600
-------------
11,064,721
-------------
Basic Industry-1.6%
Chemicals-1.6%
Air Products & Chemicals, Inc. 80,000 4,580,000
E.I. du Pont de Nemours & Co. 78,100 3,539,492
-------------
8,119,492
-------------
Consumer Manufacturing-0.9%
Building & Related-0.9%
American Standard Cos., Inc.(a)* 115,000 4,478,100
-------------
Total Common Stocks
(cost $425,419,070) 473,584,902
-------------
SHORT-TERM INVESTMENT-8.9%
Time Deposit-8.9%
State Street Euro Dollar
1.35%, 12/01/04
(cost $45,275,000) $ 45,275 45,275,000
-------------
Total Investments Before Security Lending
Collateral-101.8%
(cost $470,694,070) 518,859,902
-------------
_______________________________________________________________________________
ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND o 11
Portfolio of Investments
- -------------------------------------------------------------------------------
Shares U.S. $ Value
- -------------------------------------------------------------------------------
INVESTMENT OF CASH COLLATERAL FOR
SECURITIES LOANED-7.9%
Short-Term Investment
UBS Private Money Market Fund, LLC, 1.91%
(cost $40,250,265) 40,250,265 $ 40,250,265
-------------
Total Investments-109.7%
(cost $510,944,335) 559,110,167
Other assets less liabilities-(9.7%) (49,721,236)
-------------
Net Assets-100% $ 509,388,931
=============
* Represents entire or partial securities out on loan. See note E for
securities lending information.
(a) Non-income producing security.
Glossary:
ADR - American Depositary Receipt
See notes to financial statements.
_______________________________________________________________________________
12 o ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND
Statement of Assets & Liabilities
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STATEMENT OF ASSETS & LIABILITIES
November 30, 2004
ASSETS
Investments in securities, at value (cost $510,944,335--
including investment of cash collateral for securities
loaned of $40,250,265) $ 559,110,167(a)
Cash 817
Dividends and interest receivable 2,897,548
Receivable for capital stock sold 1,476,885
Receivable for investment securities sold 899,661
--------------
Total assets 564,385,078
--------------
LIABILITIES
Payable for collateral on securities loaned 40,250,265
Payable for investment securities purchased 12,442,814
Payable for capital stock redeemed 1,588,365
Distribution fee payable 289,873
Advisory fee payable 230,255
Transfer Agent fee payable 50,035
Administrative fee payable 14,165
Accrued expenses 130,375
--------------
Total liabilities 54,996,147
--------------
Net Assets $ 509,388,931
==============
COMPOSITION OF NET ASSETS
Capital stock, at par $ 35,351
Additional paid-in capital 458,216,414
Undistributed net investment income 1,499,243
Accumulated net realized gain on investment transactions 1,472,091
Net unrealized appreciation of investments 48,165,832
--------------
$ 509,388,931
==============
CALCULATION OF MAXIMUM OFFERING PRICE
Class A Shares
Net asset value and redemption price per share
($224,377,358 / 15,272,995 shares of capital
stock issued and outstanding) $14.69
Sales charge--4.25% of public offering price .65
------
Maximum offering price $15.34
======
Class B Shares
Net asset value and offering price per share
($202,458,607 / 14,260,145 shares of capital
stock issued and outstanding) $14.20
======
Class C Shares
Net asset value and offering price per share
($82,311,615 / 5,800,988 shares of capital
stock issued and outstanding) $14.19
======
Class R Shares
Net asset value, redemption, and offering price per share
($241,351 / 16,459 shares of capital stock
issued and outstanding) $14.66
======
(a) Includes securities on loan with a value of $39,246,344 (see Note E).
See notes to financial statements.
_______________________________________________________________________________
ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND o 13
Statement of Operations
- -------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
Year Ended November 30, 2004
INVESTMENT INCOME
Dividends (net of foreign taxes
withheld of $34,300) $ 9,521,092
Interest 167,981 $ 9,689,073
------------
EXPENSES
Advisory fee 3,577,891
Distribution fee -- Class A 645,416
Distribution fee -- Class B 2,079,878
Distribution fee -- Class C 851,651
Distribution fee -- Class R 428
Transfer agency 1,029,637
Printing 185,515
Custodian 173,732
Registration 103,742
Legal 93,692
Administrative 88,511
Audit 52,084
Directors' fees 21,650
Miscellaneous 27,635
------------
Total expenses 8,931,462
Less: expenses waived and reimbursed by
the Adviser and the Transfer Agent
(see Note B) (741,580)
Less: expense offset arrangement
(see Note B) (52)
------------
Net expenses 8,189,830
------------
Net investment income 1,499,243
------------
REALIZED AND UNREALIZED GAIN
ON INVESTMENT TRANSACTIONS
Net realized gain on investment
transactions 33,088,053
Net change in unrealized
appreciation/depreciation
of investments 8,255,807
------------
Net gain on investment transactions 41,343,860
------------
NET INCREASE IN NET ASSETS
FROM OPERATIONS $ 42,843,103
============
See notes to financial statements.
_______________________________________________________________________________
14 o ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND
Statement of Changes in Net Assets
- -------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
Year Ended Year Ended
November 30, November 30,
2004 2003
============= =============
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS
Net investment income (loss) $ 1,499,243 $ (1,681,751)
Net realized gain on investment
transactions 33,088,053 25,332,701
Net change in unrealized
appreciation/depreciation
of investments 8,255,807 31,818,043
------------- -------------
Net increase in net assets
from operations 42,843,103 55,468,993
CAPITAL STOCK TRANSACTIONS
Net increase 48,919,998 137,965,787
------------- -------------
Total increase 91,763,101 193,434,780
NET ASSETS
Beginning of period 417,625,830 224,191,050
------------- -------------
End of period (including undistributed
net investment income of
$1,499,243 and $0, respectively) $ 509,388,931 $ 417,625,830
============= =============
See notes to financial statements.
_______________________________________________________________________________
ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND o 15
Notes to Financial Statements
- -------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
November 30, 2004
NOTE A
Significant Accounting Policies
AllianceBernstein Focused Growth & Income Fund, Inc. (the "Fund"), formerly
AllianceBernstein Disciplined Value Fund, Inc. organized as a Maryland
corporation on July 6, 1999, is registered under the Investment Company Act of
1940 as a diversified, open-end management investment company. The Fund offers
Class A, Class B, Class C and Class R 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 4% to zero depending on the period of time the shares are
held. Class B shares will automatically convert to Class A shares eight 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. Class R shares are sold without an initial or contingent
deferred sales charge and are offered to certain group retirement plans. All
four 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 U.S. generally accepted
accounting principles 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
Portfolio securities are valued at their current market value determined on the
basis of market quotations or, if market quotations are not readily available
or are deemed unreliable, at "fair value" as determined in accordance with
procedures established by and under the general supervision of the Fund's Board
of Directors.
In general, the market value of securities which are readily available and
deemed reliable are 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. 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
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,
_______________________________________________________________________________
16 o ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
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 valuation, the last available
closing settlement price is used; securities traded in the over-the-counter
market, ("OTC") (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, Alliance
Capital Management, L.P. (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 (including
restricted securities) or are deemed unreliable are valued at fair value.
Factors considered in making this determination may include, but are not
limited to, information obtained by contacting the issuer, analysts, analysis
of the issuer's financial statements or other available documents. In addition,
the Fund may use fair value pricing for securities primarily traded in non-U.S.
markets because, most foreign markets close well before the Fund values its
securities at 4:00 p.m., Eastern Time. The earlier close of these foreign
markets gives rise to the possibility that significant events, including broad
market moves, may have occurred in the interim and may materially affect the
value of those securities. To account for this, the Fund may frequently value
many of its foreign equity securities using fair value prices based on third
party vendor modeling tools to the extent available.
2. Currency Translation
Assets and liabilities denominated in foreign currencies and commitments under
forward exchange currency contracts are translated into U.S. dollars at the
mean of the quoted bid and asked prices of such currencies against the U.S.
dollar. Purchases and sales of portfolio securities are translated into U.S.
dollars at the rates of exchange prevailing when such securities were acquired
or sold. Income and expenses are translated into U.S. dollars at rates of
exchange prevailing when accrued.
_______________________________________________________________________________
ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND o 17
Notes to Financial Statements
- -------------------------------------------------------------------------------
Net realized gain or loss on foreign currency transactions represents foreign
exchange gains and losses from sales and maturities of foreign fixed income
investments, foreign currency exchange contracts, holding of foreign
currencies, currency gains or losses realized between the trade and settlement
dates on foreign investment transactions, and the difference between the
amounts of dividends, interest and foreign withholding taxes recorded on the
Fund's books and the U.S. dollar equivalent amounts actually received or paid.
Net unrealized currency gains and losses from valuing foreign currency
denominated assets and liabilities at period end exchange rates are reflected
as a component of net unrealized appreciation or depreciation of investments
and foreign currency denominated assets and liabilities.
3. Taxes
It is the policy of the Fund 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. The Fund may be subject to taxes imposed by countries in which it
invests. Such taxes are generally based on income and/or capital gains earned
or repatriated. Taxes are accrued and applied to net investment income, net
realized gains and net unrealized appreciation/depreciation as such income
and/or gains are earned.
4. Investment Income and Investment Transactions
Dividend income is recorded on the ex-dividend date or as soon as the Fund is
informed of the dividend. Interest income is accrued daily. Investment
transactions are accounted for on the trade date securities are purchased or
sold. Investment gains and losses are determined on the identified cost basis.
The Fund accretes discounts as adjustments to interest income.
5. Income and Expenses
All income earned and expenses incurred by the Fund are borne on a pro-rata
basis by each outstanding class of shares, based on the proportionate interest
in the Fund represented by the net assets of such class, except that the Fund's
Class B and Class C shares bear higher distribution and transfer agent fees
than Class A and Class R shares.
6. Dividends and Distributions
Dividends and distributions to shareholders, if any, 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 U.S. generally accepted accounting principles. 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.
_______________________________________________________________________________
18 o ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
NOTE B
Advisory Fee and Other Transactions with Affiliates
Until September 6, 2004, under the terms of an investment advisory agreement,
the Fund paid the Adviser an advisory fee at an annual rate of .75% of the
Fund's average daily net assets. Effective September 7, 2004, the terms of the
investment advisory agreement were amended so that the advisory fee was reduced
to an annual rate of .55% of the first $2.5 billion, .45% of the next $2.5
billion and .40% in excess of $5 billion, of the Fund's average daily net
assets. The fee is accrued daily and paid monthly. The Adviser has agreed to
waive its fees and bear certain expenses to the extent necessary to limit total
operating expenses on an annual basis 2.50%, 3.20%, 3.20% and 2.70% of the
daily average net assets for the Class A, Class B, Class C and Class R shares,
respectively. For the year ended November 30, 2004, there were no fees waived
by the Adviser.
Effective January 1, 2004 through September 6, 2004, in contemplation of the
final agreement with the Office of New York Attorney General ("NYAG") the
Adviser began waiving a portion of its advisory fee so as to charge the Fund at
the reduced annual rate discussed above. Through September 6, 2004 such waiver
amounted to $707,211. For a more complete discussion of the Adviser's
settlement with the NYAG, please see "Legal Proceedings" below.
Pursuant to the advisory agreement, the Fund paid $88,511 to the Adviser
representing the cost of certain legal and accounting services provided to the
Fund by the Adviser for the year ended November 30, 2004.
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 $624,959 for the year ended November 30,
2004. During the period, AGIS voluntarily agreed to waive a portion of its fees
for such services. Such waiver amounted to $34,369.
For the year ended November 30, 2004, the Fund's expenses were reduced by $52
under an expense offset arrangement with AGIS.
AllianceBernstein Investment Research and Management, Inc. (the "Distributor"),
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 $28,254 from the sale of Class A shares and received
$2,579, $312,820 and $19,347 in contingent deferred sales charges imposed upon
redemptions by shareholders of Class A, Class B and Class C shares,
respectively, for the year ended November 30, 2004.
_______________________________________________________________________________
ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND o 19
Notes to Financial Statements
- -------------------------------------------------------------------------------
Brokerage commissions paid on investment transactions for the year ended
November 30, 2004, amounted to $1,869,926, of which $212,185 was paid to
Sanford C. Bernstein & Co. LLC, an affiliate of the Adviser.
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 distribution and servicing fees to the Distributor at
an annual rate of up to .30 of 1% of the average daily net assets attributable
to Class A shares, 1% of the average daily net assets attributable to both
Class B and Class C shares and .50 of 1% of the average daily net assets
attributable to Class R shares. The fees are accrued daily and paid monthly.
The Agreement provides that the Distributor 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 $2,150,305 and
$1,088,477 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 and Class R 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 November 30, 2004, were as follows:
Purchases Sales
============= =============
Investment securities (excluding
U.S. government securities) $ 673,519,774 $ 639,203,292
U.S. government securities -0- -0-
The cost of investments for federal income tax purposes, gross unrealized
appreciation and unrealized depreciation are as follows:
Cost $ 514,425,560
=============
Gross unrealized appreciation $ 54,106,210
Gross unrealized depreciation (9,421,603)
-------------
Net unrealized appreciation $ 44,684,607
=============
1. Financial Futures Contracts
The Fund may buy or sell financial futures contracts for the purpose of hedging
its portfolio against adverse effects of anticipated movements in the market.
The
_______________________________________________________________________________
20 o ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
Fund bears the market risk that arises from changes in the value of these
financial instruments and the imperfect correlation between movements in the
price of the futures contracts and movements in the price of the securities
hedged or used for cover.
At the time the Fund enters into a futures contract, the Fund deposits and
maintains as collateral an initial margin as required by the exchange on which
the transaction is affected. Pursuant to the contract, the Fund agrees to
receive from or pay to the broker an amount of cash equal to the daily
fluctuation in the value of the contract. Such receipts or payments are known
as variation margin and are recorded by the Fund as unrealized gains or losses.
Risks may arise from the potential inability of a counterparty to meet the
terms of the contract. When the contract is closed, the Fund records a realized
gain or loss equal to the difference between the value of the contract at the
time it was opened and the time it was closed.
NOTE E
Securities Lending
The Fund has entered into a securities lending agreement with UBS Warburg LLC
(the "Lending Agent"). Under the terms of the agreement, the Lending Agent, on
behalf of the Fund, administers the lending of portfolio securities to certain
broker-dealers. In return, the Fund receives fee income from the lending
transactions or it retains a portion of interest on the investment of any cash
received as collateral. The Fund also continues to receive dividends or
interest on the securities loaned. Unrealized gain or loss on the value of the
securities loaned that may occur during the term of the loan will be reflected
in the accounts of the Fund. All loans are continuously secured by collateral
exceeding the value of the securities loaned. All collateral consists of either
cash or U.S. government securities. The Lending Agent may invest the cash
collateral received in an eligible money market vehicle in accordance with the
investment restrictions of the Fund. The Lending Agent will indemnify the Fund
for any loss resulting from a borrower's failure to return a loaned security
when due. As of November 30, 2004 the Fund had loaned securities with a value
of $39,246,344, and received cash collateral which was invested in a money
market fund valued at $40,250,265 as included in the accompanying portfolio of
investments. For the year ended November 30, 2004 the Fund earned fee income of
$1,482 which is included in interest income in the accompanying statement of
operations.
NOTE F
Capital Stock
There are 12,000,000,000 shares of $0.001 par value capital stock authorized,
divided into four classes, designated Class A, Class B, Class C and Class R
_______________________________________________________________________________
ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND o 21
Notes to Financial Statements
- -------------------------------------------------------------------------------
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
November 30, November 30, November 30 November 30,
2004 2003 2004 2003
------------ ------------ -------------- --------------
Class A
Shares sold 7,238,856 9,125,172 $103,148,985 $111,918,729
- -------------------------------------------------------------------------------
Shares converted
from Class B 484,538 128,407 6,986,924 1,554,768
- -------------------------------------------------------------------------------
Shares redeemed (4,744,089) (3,909,984) (67,118,770) (45,610,030)
- -------------------------------------------------------------------------------
Net increase 2,979,305 5,343,595 $ 43,017,139 $ 67,863,467
===============================================================================
Class B
Shares sold 4,135,410 6,793,783 $ 57,249,878 $ 80,861,501
- -------------------------------------------------------------------------------
Shares converted
to Class A (499,813) (131,271) (6,986,924) (1,554,768)
- -------------------------------------------------------------------------------
Shares redeemed (3,545,993) (2,918,910) (48,720,045) (33,152,522)
- -------------------------------------------------------------------------------
Net increase 89,604 3,743,602 $ 1,542,909 $ 46,154,211
===============================================================================
Class C
Shares sold 2,001,187 3,029,991 $ 27,743,251 $ 35,819,659
- -------------------------------------------------------------------------------
Shares redeemed (1,726,540) (1,060,339) (23,603,007) (11,881,550)
- -------------------------------------------------------------------------------
Net increase 274,647 1,969,652 $ 4,140,244 $ 23,938,109
===============================================================================
Year November 3, Year November 3,
Ended 2003(a) to Ended 2003(a) to
November 30, November 30, November 30, November 30,
2004 2003 2004 2003
------------ ------------ -------------- --------------
Class R
Shares sold 19,114 760 $ 266,911 $ 10,000
- -------------------------------------------------------------------------------
Shares redeemed (3,415) -0- (47,205) -0-
- -------------------------------------------------------------------------------
Net increase 15,699 760 $ 219,706 $ 10,000
===============================================================================
(a) Commencement of distributions.
NOTE G
Risk Involved in Investing in the Fund
In the ordinary course of business, the Fund enters into contracts that contain
a variety of indemnifications. The Fund's maximum exposure under these
arrangements is unknown. However, the Fund has not had prior claims or losses
pursuant to these indemnification provisions and expects the risk of loss
thereunder to be remote.
NOTE H
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")
_______________________________________________________________________________
22 o ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
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 November 30, 2004.
NOTE I
Components of Accumulated Earnings (Deficit)
As of November 30, 2004, the components of accumulated earnings/(deficit) on a
tax basis were as follows:
Accumulated capital and other gain/(losses) $ 4,953,316(a)
Undistributed ordinary income 1,499,243
Unrealized appreciation/(depreciation) 44,684,607(b)
------------
Total accumulated earnings/(deficit) $ 51,137,166
============
(a) During the fiscal year, the Fund utilized capital loss carryforwards of
$27,775,563.
(b) The difference between book-basis and tax-basis unrealized
appreciation/(depreciation) is attributable primarily to the tax deferral of
losses on wash sales.
NOTE J
Legal Proceedings
As has been previously reported, the staff of the U.S. Securities and Exchange
Commission ("SEC") and the NYAG have been investigating practices in the mutual
fund industry identified as "market timing" and "late trading" of mutual fund
shares. Certain other regulatory authorities have also been conducting
investigations into these practices within the industry and have requested that
the Adviser provide information to them. The Adviser has been cooperating and
will continue to cooperate with all of these authorities.
On December 18, 2003, the Adviser confirmed that it had reached terms with the
SEC and the NYAG for the resolution of regulatory claims relating to the
practice of "market timing" mutual fund shares in some of the AllianceBernstein
Mutual Funds. The agreement with the SEC is reflected in an Order of the
Commission ("SEC Order"). The agreement with the NYAG is memorialized in an
Assurrance of Discontinuance dated September 1, 2004 ("NYAG Order"). Among the
key provisions of these agreements are the following:
(i) The Adviser agreed to establish a $250 million fund (the "Reimbursement
Fund") to compensate mutual fund shareholders for the adverse effects of market
timing attributable to market timing relationships described in the SEC Order.
According to the SEC Order, the Reimbursement Fund is to be paid, in order of
priority, to fund investors based on (i) their aliquot share of losses suffered
by the fund due to market timing, and (ii) a proportionate share of advisory
fees paid by such fund during the period of such market timing;
_______________________________________________________________________________
ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND o 23
Notes to Financial Statements
- -------------------------------------------------------------------------------
(ii) The Adviser agreed to reduce the advisory fees it receives from some of
the AllianceBernstein long-term, open-end retail funds until December 31, 2008;
and
(iii) The Adviser agreed to implement changes to its governance and compliance
procedures. Additionally, the SEC Order and the NYAG Order contemplate that the
Adviser's registered investment company clients, including the Fund, will
introduce governance and compliance changes.
In anticipation of final, definitive documentation of the NYAG Order and
effective January 1, 2004, the Adviser began waiving a portion of its advisory
fee. On September 7 2004, the Fund's investment advisory agreement was amended
to reflect the reduced advisory fee. For more information on this waiver and
amendment to the Fund's investment advisory agreement, please see "Advisory Fee
and Other Transactions with Affiliates" above.
A special committee of the Adviser's Board of Directors, comprised of the
members of the Adviser's Audit Committee and the other independent member of
the Adviser's Board, is continuing to direct and oversee an internal
investigation and a comprehensive review of the facts and circumstances
relevant to the SEC's and the NYAG's investigations.
In addition, the Independent Directors of the Fund ("the Independent
Directors") have initiated an investigation of the above-mentioned matters with
the advice of an independent economic consultant and independent counsel. The
Independent Directors have formed a special committee to supervise the
investigation.
On October 2, 2003, a putative class action complaint entitled Hindo et al. v.
AllianceBernstein Growth & Income Fund et al. (the "Hindo Complaint") was filed
against the Adviser; Alliance Capital Management Holding L.P.; Alliance Capital
Management Corporation; AXA Financial, Inc.; certain of the AllianceBernstein
Mutual Funds, including the Fund; Gerald Malone; Charles Schaffran
(collectively, the "Alliance Capital defendants"); and certain other defendants
not affiliated with the Adviser. The Hindo Complaint was filed in the United
States District Court for the Southern District of New York by alleged
shareholders of two of the AllianceBernstein Mutual Funds. The Hindo Complaint
alleges that certain of the Alliance Capital defendants failed to disclose that
they improperly allowed certain hedge funds and other unidentified parties to
engage in late trading and market timing of AllianceBernstein Fund securities,
violating Sections 11 and 15 of the Securities Act, Sections 10(b) and 20(a) of
the Exchange Act, and Sections 206 and 215 of the Advisers Act. Plaintiffs seek
an unspecified amount of compensatory damages and rescission of their contracts
with the Adviser, including recovery of all fees paid to the Adviser pursuant
to such contracts.
_______________________________________________________________________________
24 o ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
Since October 2, 2003, numerous additional lawsuits making factual allegations
similar to those in the Hindo Complaint were filed against the Adviser and
certain other defendants, some of which name the Fund as a defendant. All of
these lawsuits seek an unspecified amount of damages. The lawsuits are now
pending in the United States District Court for the District of Maryland
pursuant to a ruling by the Judicial Panel on Multidistrict Litigation
transferring and centralizing all of the mutual fund cases involving market and
late trading in the District of Maryland.
As a result of the matters discussed above, investors in the AllianceBernstein
Mutual Funds may choose to redeem their investments. This may require the
AllianceBernstein Mutual Funds to sell investments held by those funds to
provide for sufficient liquidity and could also have an adverse effect on the
investment performance of the AllianceBernstein Mutual Funds.
The Adviser and approximately twelve other investment management firms were
publicly mentioned in connection with the settlement by the SEC of charges that
an unaffiliated broker/dealer violated federal securities laws relating to its
receipt of compensation for selling specific mutual funds and the disclosure of
such compensation. The SEC has indicated publicly that, among other things, it
is considering enforcement action in connection with mutual funds' disclosure
of such arrangements and in connection with the practice of considering mutual
fund sales in the direction of brokerage commissions from fund portfolio
transactions. The SEC has issued subpoenas to the Adviser in connection with
this matter and the Adviser has provided documents and other information to the
SEC and is cooperating fully with its investigation.
On June 22, 2004, a purported class action complaint entitled Aucoin, et al. v.
Alliance Capital Management L.P., et al. ("Aucoin Complaint") was filed against
the Adviser, Alliance Capital Management Holding L.P., Alliance Capital
Management Corporation, AXA Financial, Inc., AllianceBernstein Investment
Research & Management, Inc., certain current and former directors of the
AllianceBernstein Mutual Funds, and unnamed Doe defendants. The Aucoin
Complaint names certain of the AllianceBernstein mutual funds as nominal
defendants. The Aucoin Complaint was filed in the United States District Court
for the Southern District of New York by an alleged shareholder of an
AllianceBernstein mutual fund. The Aucoin Complaint alleges, among other
things, (i) that certain of the defendants improperly authorized the payment of
excessive commissions and other fees from fund assets to broker-dealers in
exchange for preferential marketing services, (ii) that certain of the
defendants misrepresented and omitted from registration statements and other
reports material facts concerning such payments, and (iii) that certain
defendants caused such conduct as control persons of other defendants. The
Aucoin Complaint asserts claims for violation of Sections 34(b), 36(b) and
48(a) of the Investment Company Act, Sections 206 and 215 of the Advisers Act,
breach of common law
_______________________________________________________________________________
ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND o 25
Notes to Financial Statements
- -------------------------------------------------------------------------------
fiduciary duties, and aiding and abetting breaches of common law fiduciary
duties. Plaintiffs seek an unspecified amount of compensatory damages and
punitive damages, rescission of their contracts with the Adviser, including
recovery of all fees paid to the Adviser pursuant to such contracts, an
accounting of all fund-related fees, commissions and soft dollar payments, and
restitution of all unlawfully or discriminatorily obtained fees and expenses.
Since June 22, 2004, numerous additional lawsuits making factual allegations
substantially similar to those in the Aucoin Complaint were filed against the
Adviser and certain other defendants, and others may be filed.
It is possible that these matters and/or other developments resulting from
these matters could result in increased redemptions of the Fund's shares or
other adverse consequences to the Fund. However, the Adviser believes that
these matters are not likely to have a material adverse effect on its ability
to perform advisory services relating to the Fund.
_______________________________________________________________________________
26 o ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND
Financial Highlights
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Class A
---------------------------------------------------------------
December 22,
Year Ended November 30, 1999(a) to
-------------------------------------------------- November 30,
2004 2003 2002 2001 2000
----------- ----------- ----------- ----------- -----------
Net asset value,
beginning of period $13.27 $10.85 $13.09 $11.42 $10.00
INCOME FROM INVESTMENT
OPERATIONS
Net investment income (loss)(b) .10(c)(d) (.01) (.01) (.07)(c) (.03)(c)
Net realized and unrealized
gain (loss) on investment
transactions 1.32 2.43 (2.23) 1.82 1.45
Net increase (decrease) in
net asset value from
operations 1.42 2.42 (2.24) 1.75 1.42
LESS: DISTRIBUTIONS
Distributions in excess
of net realized gain on
investment transactions -0- -0- -0- (.08) -0-
Net asset value,
end of period $14.69 $13.27 $10.85 $13.09 $11.42
TOTAL RETURN
Total investment return based
on net asset value(e) 10.70% 22.30% (17.11)% 15.40% 14.20%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $224,377 $163,169 $75,413 $76,617 $14,583
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements 1.19% 1.51% 1.59% 1.85% 2.50%(f)
Expenses, before waivers/
reimbursements 1.34% 1.51% 1.59% 1.88% 9.25%(f)
Net investment
income (loss) .73%(c)(d) (.12)% (.10)% (.55)%(c) (.33)%(c)(f)
Portfolio turnover rate 132% 159% 218% 299% 249%
See footnote summary on page 30.
_______________________________________________________________________________
ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND o 27
Financial Highlights
- -------------------------------------------------------------------------------
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Class B
------------------------------------------------------------------
December 22,
Year Ended November 30, 1999(a) to
----------------------------------------------------- November 30,
2004 2003 2002 2001 2000
------------ ------------- ----------- ----------- -----------
Net asset value,
beginning of period $12.92 $10.64 $12.93 $11.36 $10.00
INCOME FROM INVESTMENT
OPERATIONS
Net investment income (loss)(b) -0-(c)(d)(g) (.10) (.10) (.16)(c) (.11)(c)
Net realized and unrealized
gain (loss) on investment
transactions 1.28 2.38 (2.19) 1.81 1.47
Net increase (decrease) in
net asset value from
operations 1.28 2.28 (2.29) 1.65 1.36
LESS: DISTRIBUTIONS
Distributions in excess
of net realized gain on
investment transactions -0- -0- -0- (.08) -0-
Net asset value,
end of period $14.20 $12.92 $10.64 $12.93 $11.36
TOTAL RETURN
Total investment return based
on net asset value(c) 9.91% 21.43% (17.71)% 14.60% 13.60%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $202,459 $183,098 $110,968 $98,204 $2,597
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements 1.92% 2.25% 2.32% 2.55% 3.20%(f)
Expenses, before waivers/
reimbursements 2.07% 2.25% 2.32% 2.60% 8.16%(f)
Net investment loss (.03)%(c)(d) (.87)% (.84)% (1.28)%(c) (1.08)%(c)(f)
Portfolio turnover rate 132% 159% 218% 299%(c) 249%(c)
See footnote summary on page 30.
_______________________________________________________________________________
28 o ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND
Financial Highlights
- -------------------------------------------------------------------------------
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Class C
------------------------------------------------------------------
December 22,
Year Ended November 30, 1999(a) to
----------------------------------------------------- November 30,
2004 2003 2002 2001 2000
------------ ------------- ----------- ----------- -----------
Net asset value,
beginning of period $12.91 $10.63 $12.92 $11.34 $10.00
INCOME FROM INVESTMENT
OPERATIONS
Net investment income (loss)(b) -0-(c)(d)(g) (.10) (.10) (.16)(c) (.12)(c)
Net realized and unrealized
gain (loss) on investment
transactions 1.28 2.38 (2.19) 1.82 1.46
Net increase (decrease) in
net asset value from
operations 1.28 2.28 (2.29) 1.66 1.34
LESS: DISTRIBUTIONS
Distributions in excess
of net realized gain on
investment transactions -0- -0- -0- (.08) -0-
Net asset value,
end of period $14.19 $12.91 $10.63 $12.92 $11.34
TOTAL RETURN
Total investment return based
on net asset value(d) 9.91% 21.45% (17.72)% 14.71% 13.40%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $82,312 $71,348 $37,810 $35,790 $2,525
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements 1.90% 2.22% 2.30% 2.56% 3.20%(f)
Expenses, before waivers/
reimbursements 2.05% 2.22% 2.30% 2.60% 10.14%(f)
Net investment loss (.01)%(c)(d) (.84)% (.82)% (1.28)%(c) (1.08)%(c)(f)
Portfolio turnover rate 132% 159% 218% 299%(c) 249%(c)
See footnote summary on page 30.
_______________________________________________________________________________
ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND o 29
Financial Highlights
- -------------------------------------------------------------------------------
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Class R
-------------------------------
Year November 3,
Ended 2003(h) to
November 30, November 30,
2004 2003
-------------- --------------
Net asset value, beginning of period $13.27 $13.16
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss)(b) .18(c)(d) -0-(g)
Net realized and unrealized gain on
investment transactions 1.21 .11
Net increase in net asset value from
operations 1.39 .11
Net asset value, end of period $14.66 $13.27
TOTAL RETURN
Total investment return based on net
asset value(e) 10.48% .84%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $241 $10
Ratio to average net assets of:
Expenses, net of waivers/reimbursements 1.45% 1.83%(f)
Expenses, before waivers/reimbursements 1.59% 1.83%(f)
Net investment income (loss) 1.25%(c)(d) (.26)%(f)
Portfolio turnover rate 132% 159%
(a) Commencement of operations.
(b) Based on average shares outstanding.
(c) Net of fees and expenses waived/reimbursed by the Adviser.
(d) Net of fees and expenses waived/reimbursed by the Transfer Agent.
(e) Total investment return is calculated assuming an initial investment made
at the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period. Initial sales charge or contingent
defered sales charge is not reflected in the calculation of the 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.
(f) Annualized.
(g) Amount is less than $0.005.
(h) Commencement of distributions.
_______________________________________________________________________________
30 o ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND
Report of Independent Registered Public Accounting Firm
- -------------------------------------------------------------------------------
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and Board of Directors of
AllianceBernstein Focused Growth & Income Fund, Inc.
We have audited the accompanying statement of assets and liabilities of
AllianceBernstein Focused Growth & Income Fund, Inc., formerly
AllianceBernstein Disciplined Value Fund, Inc. (the "Fund"), including the
portfolio of investments, as of November 30, 2004 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 periods indicated therein. These financial statements and financial
highlights are the responsibility of the Fund's management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits.
We conducted our audits in accordance with standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements and financial highlights are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements and the financial
highlights. Our procedures included confirmation of securities owned as of
November 30, 2004, by correspondence with the custodian and brokers. 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 Focused Growth & Income Fund, Inc. at November 30, 2004, 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 indicated periods, in conformity with U.S. generally
accepted accounting principles.
/s/ Ernst & Young LLP
New York, New York
January 10, 2005
_______________________________________________________________________________
ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND o 31
Board of Directors
- -------------------------------------------------------------------------------
BOARD OF DIRECTORS
William H. Foulk, Jr.(1), Chairman
Marc O. Mayer, President
Ruth Block(1)
David H. Dievler(1)
John H. Dobkin(1)
Michael J. Downey(1)
OFFICERS
Philip L. Kirstein, Senior Vice President and Independent Compliance Officer
Frank V. Caruso,(2) Senior Vice President
Paul C. Rissman,(2) Senior Vice President
Thomas J. Bardong, Vice President
Mark R. Manley, Secretary
Mark D. Gersten, Treasurer and Chief Financial Officer
Vincent S. Noto, Controller
Custodian
State Street Bank & Trust Company
225 Franklin Street
Boston, MA 02110
Principal Underwriter
AllianceBernstein Investment Research and Management, Inc.
1345 Avenue of the Americas
New York, NY 10105
Transfer Agent
Alliance Global Investor Services, Inc.
P.O. Box 786003
San Antonio, TX 78278-6003
Toll-free (800) 221-5672
Independent Registered Public Accounting Firm
Ernst & Young LLP
5 Times Square
New York, NY 10036
Legal Counsel
Seward & Kissel LLP
One Battery Park Plaza
New York, NY 10004
(1) Member of the Audit Committee and the Governance and Nominating Committee.
(2) Messrs. Rissman and Caruso are the persons primarily responsible for the
day-to-day management of the Fund's investment portfolio.
_______________________________________________________________________________
32 o ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND
Management of the Fund
- -------------------------------------------------------------------------------
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, ADDRESS, PRINCIPAL COMPLEX DIRECTORSHIPS
DATE OF BIRTH, OCCUPATION(S) OVERSEEN BY HELD BY
(YEAR ELECTED) DURING PAST 5 YEARS DIRECTOR DIRECTOR
- --------------------------------------------------------------------------------------------------------------
DISINTERESTED DIRECTORS
William H. Foulk, Jr., # Investment Adviser and an 113 None
2 Sound View Drive Independent Consultant. He
Suite 100, was formerly Senior Manager
Greenwich, CT 06830 of Barrett Associates, Inc., a
Chairman of the Board registered investment adviser,
9/7/32 with which he had been
(1999) associated since prior to 2000.
He was formerly Deputy
Comptroller and Chief Investment
Officer of the State of New York
and, prior thereto, Chief
Investment Officer of the
New York Bank for Savings.
Ruth Block, #** Formerly Executive Vice President 94 None
500 S.E. Mizner Blvd. and Chief Insurance Officer of
Boca Raton, FL 33432 The Equitable Life Assurance
11/7/30 Society of the United States;
(1999) 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, # Independent Consultant. Until 98 None
P.O. Box 167 December 1994 he was Senior
Spring Lake, NJ 07762 Vice President of Alliance Capital
10/23/29 Management Corporation ("ACMC")
(1999) responsible 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 a Senior Manager at
Price Waterhouse & Co. Member
of American Institute of Certified
Public Accountants since 1953.
_______________________________________________________________________________
ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND o 33
Management of the Fund
- -------------------------------------------------------------------------------
PORTFOLIOS
IN FUND OTHER
NAME, ADDRESS, PRINCIPAL COMPLEX DIRECTORSHIPS
DATE OF BIRTH, OCCUPATION(S) OVERSEEN BY HELD BY
(YEAR ELECTED) DURING PAST 5 YEARS DIRECTOR DIRECTOR
- --------------------------------------------------------------------------------------------------------------
DISINTERESTED DIRECTORS (continued)
John H. Dobkin, # Consultant. Formerly President 96 None
P.O. Box 12, of Save Venice, Inc. (preservation
Annandale, NY 12504 organization) from 2001-2002;
2/19/42 Senior Advisor from June
(1999) 1999 - June 2000 and President
of Historic Hudson Valley (historic
preservation) from December
1989 - May 1999. Previously, he
was Director of the National
Academy of Design and during
1988-1992, he was Director and
Chairman of the Audit Committee
of ACMC.
Michael J. Downey, # Consultant since January 2004. 66 Asia Pacific
c/o Alliance Capital Formerly managing partner of Fund, Inc.,
Management L.P. Lexington Capital, LLC (investment and The
1345 Avenue of the advisory firm) from 1997 until Merger Fund
Americas December 2003. Prior thereto,
New York, NY 10105 Chairman and CEOof Prudential
1/24/44 Mutual Fund Management
(2005) (1987-1993).
INTERESTED DIRECTOR
Marc O. Mayer,+ Executive Vice President of 66 None
1345 Avenue of the ACMC since 2001; prior thereto,
Americas Chief Executive Officer of Sanford C.
New York, NY 10105 Bernstein & Co., LLC and its
10/2/57 predecessor since prior to 2000.
(2003)
* There is no stated term of office for the Fund's Directors.
** Ms. Block was an "interested person," as defined in the 1940 Act, until
October 21, 2004 by reason of her ownership of 116 American Depositary Shares
of AXA having a value of approximately $2,396. AXA is a controlling person of
ACMC. Ms. Block received shares of The Equitable Companies Incorporated as part
of the demutualization of The Equitable Life Assurance Society of the United
States, which were subsequently converted through a corporate action into 116
American Depositary Shares of AXA.
+ Mr. Mayer is an "interested person," as defined in the 1940 Act, due to his
position as an Executive Vice President of ACMC, the investment adviser.
# Member of the Audit Committee and the Governance and Nominating Committee.
_______________________________________________________________________________
34 o ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND
Management of the Fund
- -------------------------------------------------------------------------------
Officer Information
Certain information concerning the Fund's Officers is listed below.
NAME, ADDRESS* POSITION(S) PRINCIPAL OCCUPATION
AND DATE OF BIRTH HELD WITH FUND DURING PAST 5 YEARS**
- --------------------------------------------------------------------------------------------------------------
Marc O. Mayer President and Chief See biography above.
10/2/57 Executive Officer
Paul C. Rissman Senior Vice President Executive Vice President of ACMC,**
11/10/56 with which he has been associated
since prior to 2000.
Frank V. Caruso Senior Vice President Senior Vice President of ACMC,** with
10/28/56 which he has been associated since
prior to 2000.
Philip L. Kirstein Senior Vice President Senior Vice President, Independent
5/29/45 and Independent Compliance Officer-Mutual Funds of
Compliance Officer ACMC** with which he has been
associated since October 2004. Prior
thereto, he was Of Counsel to
Kirkpatrick & Lockhart, LLP from
October 2003 to October 2004, and
General Counsel and First Vice
President of Merrill Lynch Investment
Managers L.P. since prior to 2000 until
March 2003.
Thomas J. Bardong Vice President Senior Vice President of ACMC,** with
4/28/45 which he has been associated since
prior to 2000.
Mark R. Manley Secretary Senior Vice President, Deputy General
10/23/62 Counsel and Chief Compliance Officer
of ACMC,** with which he has been
associated since prior to 2000.
Mark D. Gersten Treasurer and Chief Senior Vice President of Alliance
10/4/50 Financial Officer Global Investor Services, Inc.
("AGIS"),** and a Vice President of
AllianceBernstein Investment Research
and Management, Inc. ("ABIRM")** with
which he has been associated since
prior to 2000.
Vincent S. Noto Controller Vice President of AGIS,** with which
12/14/64 he has been associated since prior to
2000.
* 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.
_______________________________________________________________________________
ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND o 35
AllianceBernstein Family of Funds
- -------------------------------------------------------------------------------
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 Funds
- --------------------------------------------
U.S. Large Cap Portfolio
International Portfolio
Tax-Managed International Portfolio
- --------------------------------------------
Growth Funds
- --------------------------------------------
Domestic
Growth Fund
Mid-Cap Growth Fund
Large Cap Growth Fund*
Small Cap Growth Fund
Global & International
All-Asia Investment Fund
Global Health Care Fund*
Global Research Growth Fund
Global Technology Fund*
Greater China '97 Fund
International Premier Growth Fund
New Europe Fund
Worldwide Privatization Fund
- --------------------------------------------
Value Funds
- --------------------------------------------
Domestic
Balanced Shares
Focused Growth & Income 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) 227-4618 for a current
prospectus. You should read the prospectus carefully before you invest.
* Prior to December 15, 2004, these Funds were named as follows: Global Health
Care Fund was Health Care Fund; Large Cap Growth Fund was Premier Growth Fund;
Global Technology Fund was Technology Fund; and Focused Growth & Income Fund
was Disciplined Value Fund.
** Effective February 1, 2005, Small Cap Value Fund will be renamed
Small/Mid-Cap Value Fund.
*** 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.
_______________________________________________________________________________
36 o ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND
ALLIANCEBERNSTEIN FOCUSED GROWTH & INCOME FUND
1345 Avenue of the Americas
New York, NY 10105
(800) 221-5672
[LOGO](AllianceBernstein [LOGO](SM)
Investment Research and Management
SM This service mark used under license from the owner, Alliance Capital
Management L.P.
ACBVIDVFAR1104
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 11(a)(1).
(b) During the period covered by this report, no material 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
David H. Dievler and William H. Foulk, Jr. qualify as audit committee financial
experts.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) - (c) The following table sets forth the aggregate fees billed by the
independent registered public accounting firm Ernst & Young LLP, for the Fund's
last two fiscal years for professional services rendered for: (i) the audit of
the Fund's annual financial statements included in the Fund's annual report to
stockholders; (ii) assurance and related services that are reasonably related to
the performance of the audit of the Fund's financial statements and are not
reported under (i), which include multi-class distribution testing, advice and
education on accounting and auditing issues, and consent letters; and (iii) tax
compliance, tax advice and tax return preparation.
Audit-Related
Audit Fees Fees Tax Fees
- ----------------------------------------------------------------------------------------------------
AllianceBernstein Focused Growth & Income 2003 $35,000 $1,302 $11,466
Fund, Inc..**
2004 $38,000 $4,130 $19,335
** Formerly known as AllianceBernstein Disciplined Value Fund
(d) Not applicable.
(e) (1) Beginning with audit and non-audit service contracts entered into on or
after May 6, 2003, the Fund's Audit Committee policies and procedures require
the pre-approval of all audit and non-audit services provided to the Fund by the
Fund's independent registered public accounting firm. The Fund's Audit Committee
policies and procedures also require pre-approval of all audit and non-audit
services provided to the Adviser and Service Affiliates to the extent that these
services are directly related to the operations or financial reporting of the
Fund.
(e) (2) All of the amounts for Audit Fees, Audit-Related Fees and Tax Fees in
the table under Item 4 (a) - (c) are for services pre-approved by the Fund's
Audit Committee.
(f) Not applicable.
(g) The following table sets forth the aggregate non-audit services provided to
the Fund, the Fund's Adviser and entities that control, are controlled by or
under common control with the Adviser that provide ongoing services to the Fund,
which include conducting an annual internal control report pursuant to Statement
on Auditing Standards No. 70 ("Service Affiliates"):
Total Amount of
Foregoing Column
Pre-approved by the
Audit Committee
All Fees for (Portion Comprised of
Non-Audit Services Audit Related Fees)
Provided to the (Portion Comprised of
Portfolio, the Adviser Tax Fees)
and Service Affiliates
- -----------------------------------------------------------------------------------------------------------------
AllianceBernstein Focused Growth & Income 2003 $664,433 [ $299,768 ]
Fund, Inc. ( $288,302 )
( $ 11,466 )
2004 $1,161,565 [ $173,465 ]
( $154,130 )
( $ 19,335 )
(h) The Audit Committee of the Fund has considered whether the provision of any
non-audit services not pre-approved by the Audit Committee provided by the
Fund's independent registered public accounting firm to the Adviser and Service
Affiliates is compatible with maintaining the auditor's independence.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable to the registrant.
ITEM 6. SCHEDULE OF INVESTMENTS.
Please see Schedule of Investments contained in the Report to Shareholders
included under Item 1 of this Form N-CSR.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable to the registrant.
ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable to the registrant.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no material changes to the procedures by which shareholders may
recommend nominees to the Fund's Board of Directors since the Fund last provided
disclosure in response to this item.
ITEM 10. 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 over
financial reporting 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 11. EXHIBITS.
The following exhibits are attached to this Form N-CSR:
Exhibit No. DESCRIPTION OF EXHIBIT
----------- ----------------------
11 (a) (1) Code of ethics that is subject to the disclosure of
Item 2 hereof
11 (b) (1) Certification of Principal Executive Officer Pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002
11 (b) (2) Certification of Principal Financial Officer Pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002
11 (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 Focused Growth & Income Fund, Inc.
By: /s/ Marc O. Mayer
-----------------
Marc O. Mayer
President
Date: January 27, 2005
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ Marc O. Mayer
-----------------
Marc O. Mayer
President
Date: January 27, 2005
By: /s/ Mark D. Gersten
-------------------
Mark D. Gersten
Treasurer and Chief Financial Officer
Date: January 27, 2005