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 811-02424
Van Kampen Strategic Growth Fund
(Exact name of registrant as specified in charter)
522 Fifth Avenue, New York, New York 10036
(Address of principal executive offices) (Zip code)
Ronald Robison
522 Fifth Avenue, New York, New York 10036
(Name and address of agent for service)
Registrant's telephone number, including area code: 212-762-4000
Date of fiscal year end: 8/31
Date of reporting period: 8/31/07
Item 1. Report to Shareholders.
The Fund's annual report transmitted to shareholders pursuant to Rule 30e-1
under the Investment Company Act of 1940 is as follows:
Welcome, Shareholder
In this report, you'll learn about how your investment in Van Kampen
Strategic Growth Fund performed during the annual period. The portfolio
management team will provide an overview of the market conditions and
discuss some of the factors that affected investment performance during
the reporting period. In addition, this report includes the fund's
financial statements and a list of fund investments as of August 31,
2007.
THIS MATERIAL MUST BE PRECEDED OR ACCOMPANIED BY A CLASS A, B, AND C
SHARE OR CLASS I AND R SHARE PROSPECTUS FOR THE FUND BEING OFFERED. THE
PROSPECTUSES CONTAIN INFORMATION ABOUT THE FUND, INCLUDING THE INVESTMENT
OBJECTIVES, RISKS, CHARGES AND EXPENSES. TO OBTAIN AN ADDITIONAL
PROSPECTUS, CONTACT YOUR FINANCIAL ADVISOR OR DOWNLOAD ONE AT
VANKAMPEN.COM. PLEASE READ THE PROSPECTUS CAREFULLY BEFORE INVESTING.
MARKET FORECASTS PROVIDED IN THIS REPORT MAY NOT NECESSARILY COME TO
PASS. THERE IS NO ASSURANCE THAT A MUTUAL FUND WILL ACHIEVE ITS
INVESTMENT OBJECTIVE. FUNDS ARE SUBJECT TO MARKET RISK, WHICH IS THE
POSSIBILITY THAT THE MARKET VALUES OF SECURITIES OWNED BY THE FUND WILL
DECLINE AND THAT THE VALUE OF FUND SHARES MAY THEREFORE BE LESS THAN WHAT
YOU PAID FOR THEM. ACCORDINGLY, YOU CAN LOSE MONEY INVESTING IN THIS
FUND.
<Table>
<Caption>
---------------------------------------------------------------------------------------
NOT FDIC INSURED OFFER NO BANK GUARANTEE MAY LOSE VALUE
---------------------------------------------------------------------------------------
NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY NOT A DEPOSIT
---------------------------------------------------------------------------------------
</Table>
Performance Summary as of 8/31/07
PERFORMANCE OF A $10,000 INVESTMENT
This chart compares your fund's performance to that of the Russell 1000(R)
Growth Index from 8/31/97 through 8/31/07. Class A shares, adjusted for sales
charges.
(LINE GRAPH)
<Table>
<Caption>
VAN KAMPEN STRATEGIC GROWTH FUND RUSSELL 1000(R) GROWTH INDEX
-------------------------------- ----------------------------
8/97 9425.00 10000.00
10210.00 10492.10
9564.00 10104.30
9425.00 10533.50
9619.00 10651.50
9504.00 10970.00
10540.00 11795.20
11150.00 12265.40
11275.00 12435.10
10775.00 12082.20
11729.00 12822.20
11369.00 12737.40
8/98 9219.00 10825.80
10224.00 11657.40
10285.00 12594.30
11112.00 13552.30
12960.00 14774.30
14216.00 15641.80
13234.00 14927.30
14864.00 15713.40
14931.00 15733.50
14318.00 15250.00
15698.00 16318.20
15547.00 15799.60
8/99 16142.00 16057.70
16365.00 15720.40
18180.00 16907.70
21032.00 17819.80
26401.00 19673.30
26359.00 18750.70
34838.00 19667.50
33209.00 21075.00
29139.00 20072.10
26087.00 19061.50
29357.00 20506.10
28692.00 19651.10
8/00 32995.00 21430.50
31345.00 19403.20
28372.00 18485.30
22479.00 15760.40
23401.00 15261.60
22950.00 16316.00
19629.00 13546.00
17926.00 12072.00
19204.00 13598.80
18805.00 13398.60
18231.00 13088.30
17348.00 12761.20
8/01 16095.00 11717.70
14392.00 10547.80
14686.00 11101.20
15644.00 12167.60
15775.00 12144.70
15406.00 11930.20
14522.00 11435.10
14925.00 11830.60
14388.00 10865.00
13915.00 10602.20
12811.00 9621.43
11607.00 9092.49
8/02 11540.00 9119.67
10843.00 8173.70
11231.00 8923.49
11425.00 9408.16
10534.00 8758.28
10418.00 8545.77
10415.00 8506.52
10594.00 8664.82
11209.00 9305.60
11980.00 9769.97
11980.00 9904.50
12312.00 10151.00
8/03 12703.00 10403.50
12263.00 10292.10
13337.00 10870.20
13482.00 10983.80
13467.00 11363.80
13661.00 11595.90
13769.00 11669.70
13624.00 11453.00
13180.00 11319.90
13475.00 11531.10
13788.00 11674.90
12867.00 11015.00
8/04 12726.00 10960.70
13095.00 11065.00
13311.00 11237.50
14027.00 11624.00
14411.00 12079.70
13889.00 11676.90
14168.00 11801.20
13900.00 11586.10
13397.00 11365.50
14172.00 11915.40
14302.00 11871.50
14921.00 12451.70
8/05 14850.00 12291.30
15204.00 12347.90
14783.00 12227.90
15454.00 12755.50
15521.00 12715.50
16449.00 12938.70
15961.00 12918.20
16177.00 13108.90
16382.00 13091.10
15298.00 12647.40
15372.00 12597.40
14746.00 12357.50
8/06 14690.00 12743.10
15022.00 13093.20
15480.00 13553.50
15935.00 13822.50
15928.00 13869.30
16349.00 14225.80
15916.00 13958.40
16185.00 14034.10
16703.00 14694.80
17381.00 15223.50
17225.00 14996.20
17038.00 14763.70
8/07 17366.00 14999.00
</Table>
<Table>
<Caption>
A SHARES B SHARES C SHARES I SHARES R SHARES
since 10/02/70 since 4/20/92 since 7/06/93 since 10/16/00 since 10/01/02
- ------------------------------------------------------------------------------------------------------------------
AVERAGE W/MAX W/MAX W/MAX
ANNUAL W/O 5.75% W/O 5.00% W/O 1.00% W/O W/O
TOTAL SALES SALES SALES SALES SALES SALES SALES SALES
RETURNS CHARGES CHARGES CHARGES CHARGES CHARGES CHARGES CHARGES CHARGES
Since
Inception 14.46% 14.28% 10.77% 10.77% 9.33% 9.33% -7.30% 9.15%
10-year 6.30 5.67 5.65 5.65 5.50 5.50 -- --
5-year 8.52 7.24 7.70 7.47 7.71 7.71 8.79 --
1-year 18.22 11.43 17.35 12.35 17.36 16.36 18.53 17.84
- ------------------------------------------------------------------------------------------------------------------
</Table>
PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH IS NO GUARANTEE OF
FUTURE RESULTS, AND CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE FIGURES
SHOWN. FOR THE MOST RECENT MONTH-END PERFORMANCE FIGURES, PLEASE VISIT
VANKAMPEN.COM OR SPEAK WITH YOUR FINANCIAL ADVISOR. INVESTMENT RETURNS AND
PRINCIPAL VALUE WILL FLUCTUATE AND FUND SHARES, WHEN REDEEMED, MAY BE WORTH MORE
OR LESS THAN THEIR ORIGINAL COST.
The returns shown in this report do not reflect the deduction of taxes that a
shareholder would pay on fund distributions or the redemption of fund shares.
Performance of share classes will vary due to differences in sales charges and
expenses. Average annual total return with sales charges includes payment of the
maximum sales charge of 5.75 percent for Class A shares, a contingent deferred
sales charge of 5.00 percent for Class B shares (in year one and declining to
zero after year five), a contingent deferred sales charge of 1.00 percent for
Class C shares in year one, and combined Rule 12b-1 fees and service fees of up
to 0.25 percent for Class A shares and up to 1.00 percent for Class B and C
shares. The since inception and 10-year returns for Class B shares reflect the
conversion of Class B shares into Class A shares eight years after purchase. The
since inception returns for Class C shares reflect the conversion of Class C
shares into Class A shares ten years after purchase. Class I Shares are offered
without any sales charges on purchases or sales and do not include combined Rule
12b-1 fees and service fees. Class I Shares are available for purchase
exclusively by investors through (i) tax-exempt retirement plans with assets of
at least one million dollars (including 401(k) plans, 457 plans, employer
sponsored 403(b) plans, profit sharing and money purchase plans, defined benefit
plans and non-qualified deferred compensation plans), (ii) fee-based investment
programs with assets of at least one million dollars and (iii) institutional
clients with assets of at least one million dollars. Class R Shares are offered
without any sales charges on purchases or sales. The combined Rule 12b-1 fees
and service fees for Class R Shares is up to 0.50 percent. Class R Shares are
available for purchase exclusively by investors through certain tax-exempt
retirement plans (including 401(k) plans, 457 plans, employer sponsored 403(b)
plans, profit sharing and money purchase pension plans, defined benefit plans
and non-qualified deferred compensation plans) held in plan level or omnibus
accounts. Figures shown above assume reinvestment of all dividends and capital
gains.
1
The Russell 1000 Growth Index measures the performance of those Russell 1000
companies (the 1000 largest U.S. companies) with higher price-to-book ratios and
higher forecasted growth values. The index does not include any expenses, fees
or sales charges, which would lower performance. The index is unmanaged and
should not be considered an investment.
2
Fund Report
FOR THE 12-MONTH PERIOD ENDED AUGUST 31, 2007
MARKET CONDITIONS
Despite periods of significant volatility, the U.S. equity market produced
strong performance returns overall for the 12-months ended August 31, 2007. The
period began with the equity market still in a positive mode following the
Federal Open Market Committee's (the "Fed") decision to halt its monetary
tightening policy and keep the target federal fund's rate at 5.25%, where it
remained through the end of the reporting period. Around this time, oil prices
began to recede from their record high level, and the subsequent relief at the
pump sparked consumer spending, and in particular back-to-school retail sales,
in the third quarter 2006. However, during the forth quarter, both investors'
and consumers' enthusiasm diminished somewhat in the face of several unsettling
reports and signals. Among these signs were the continued softening of the
domestic housing market, the mounting evidence of an economic slowdown per
revised reported second and third quarter gross domestic product (GDP) growth
data, and the uncertainty of the market's direction following the mid-term
elections and the Democrats' new majority in both the House of Representatives
and the Senate. As a result, holiday retail sales and market activity through
year-end was somewhat inconsistent, albeit generally positive. At the start of
the calendar year, the equity market found its footing once again, and stocks
experienced a rally that lasted well into February. Following a brief period of
anxiety in the equity market caused by the market sell-off in China on February
27(th) and ongoing tensions in the U.S. housing markets, stocks bounced back and
preformed strongly throughout the next several months.
In the second half of the reporting period, concerns about the housing market,
particularly the subprime mortgage sector (which lends out money to less
credit-worthy borrowers), intensified as the pace of foreclosures increased over
the spring months. The bankruptcies at a number of mortgage lenders contributed
to the demise of several hedge funds invested in subprime-related securities.
Subsequently, credit began tightening across the board, removing much of the
low-cost liquidity that had helped support the merger and acquisition (M&A) boom
and stocks' robust gains for the past several years.
Although stocks generally continued to advance, these developments roiled the
domestic equity market and investors remained uncertain about the direction for
the remainder of the reporting period.
3
PERFORMANCE ANALYSIS
Class A, I and R shares of the Van Kampen Strategic Growth Fund outperformed the
Russell 1000(R) Growth Index and Class B and C shares underperformed the Russell
1000 Growth Index for the 12 months ended August 31, 2007, assuming no deduction
of applicable sales charges.
TOTAL RETURNS FOR THE 12-MONTH PERIOD ENDED AUGUST 31, 2007
<Table>
<Caption>
- -----------------------------------------------------------------------------
RUSSELL 1000(R)
CLASS A CLASS B CLASS C CLASS I CLASS R GROWTH INDEX
18.22%. 17.35% 17.36% 18.53% 17.84% 17.70%
- -----------------------------------------------------------------------------
</Table>
The performance for the five share classes varies because each has different
expenses. The Fund's total return figures assume the reinvestment of all
distributions, but do not reflect the deduction of any applicable sales charges.
Such costs would lower performance. Past performance is no guarantee of future
results. See Performance Summary for standardized performance information and
index definition.
The Van Kampen Strategic Growth Fund's overall outperformance versus the Russell
1000 Growth Index was due to the selection of mostly large capitalization
securities that possessed strong fundamental characteristics with an aggressive
growth tilt. This positioning served as an effective buffer against the volatile
conditions of the domestic equity market during the last months of the reporting
period.
On a sector level, the sectors that contributed most significantly to the Fund's
outperformance during the period were industrial conglomerates, heavy electrical
equipment and telecommunication services. Stock selection within the industrial
sector greatly added to relative returns. In particular, the Fund's focus in the
aerospace segment significantly buoyed performance, while a reduction of
holdings in the defense segment had a positive effect on total returns. In the
heavy electrical equipment sector, investment in a company not held in the
Russell Index was advantageous to performance, and the Fund's other holdings
benefited from the strong demand for machinery and heavy equipment caused by
ongoing robust international commercial growth. In the telecommunication
services sector, selection of wireless telecommunication companies with a
concentration on Latin American countries further helped to enhance relative
returns.
Although many sectors contributed positively to the Fund during the period,
there were several sectors that had a negative impact on overall performance
relative to the Russell 1000 Growth Index. Among these was information
technology, where despite the recent strong returns offered by many of the
Fund's holdings, a lack of exposure to several key hardware and system software
companies along with a sector underweight hurt relative performance. Stock
selection in the consumer staples sector was also detrimental to overall
returns, even though the Fund's underweight position helped to somewhat mitigate
the damaging effects of the holdings. Within the consumer discretionary sector,
a
4
lack of exposure to an internet retailer and unfavorable security selection
diminished relative returns.
There is no guarantee that any sectors mentioned will continue to perform as
discussed herein or that securities in such sectors will be held by the Fund in
the future.
After careful consideration, the Board of Trustees has approved changes to the
funds' portfolio management team. Effective September 20, 2007, the U.S. Growth
team will assume day-to-day management responsibilities for Van Kampen's
Strategic Growth Fund. Members of the team responsible for the day-to-day
portfolio management include:
- - Dennis Lynch, managing director, joined the firm in 1998 and contributes more
than 13 years of investment industry experience
- - David Cohen, managing director, joined the firm in 1993 and has 19 years of
experience
- - Sam Chainani, executive director, joined the firm in 1996 and leverages 11
years of financial industry experience
- - Alexander Norton, executive director, joined the firm in 2000 and brings 12
years of investment experience to the team
- - Jason Yeung, executive director, joined the firm in 2002 and has ten years of
investment experience
5
<Table>
<Caption>
TOP 10 HOLDINGS AS OF 8/31/07
Google, Inc., Class A 2.7%
Apple, Inc. 2.6
Hewlett-Packard Co. 2.5
Precision Castparts Corp. 2.4
America Movil SA de CV, Ser L 2.4
Roche Holdings AG 2.3
Cisco Systems, Inc. 2.1
Intel Corp. 2.0
Schlumberger Ltd. 2.0
ABB Ltd. 2.0
<Caption>
SUMMARY OF INVESTMENTS BY INDUSTRY CLASSIFICATION AS OF 8/31/07
Communications Equipment 8.6%
Computer Hardware 7.5
Pharmaceuticals 7.2
Aerospace & Defense 5.6
Semiconductors 4.2
Biotechnology 4.0
Oil & Gas Equipment & Services 3.9
Internet Software & Services 3.8
Wireless Telecommunication Services 3.7
Health Care Equipment 3.1
Construction & Farm Machinery & Heavy Trucks 2.5
Systems Software 2.4
Integrated Oil & Gas 2.3
Semiconductor Equipment 2.2
Investment Banking & Brokerage 2.1
Apparel, Accessories & Luxury Goods 2.0
Heavy Electrical Equipment 2.0
Restaurants 2.0
Fertilizers & Agricultural Chemicals 1.8
Computer Storage & Peripherals 1.7
Industrial Conglomerates 1.7
IT Consulting & Other Services 1.6
Soft Drinks 1.5
Household Products 1.5
Drug Retail 1.4
Internet Retail 1.3
Apparel Retail 1.3
Integrated Telecommunication Services 1.3
Hypermarkets & Super Centers 1.2
Footwear 1.2
Other Diversified Financial Services 1.2
Specialty Stores 1.0
Diversified Metals & Mining 1.0
Auto Parts & Equipment 0.9
Computer & Electronics Retail 0.9
Railroads 0.8
Oil & Gas Exploration & Production 0.8
Specialized Finance 0.8
Application Software 0.7
Oil & Gas Refining & Marketing 0.5
</Table>
<Table>
(continued on next page)
</Table>
6
<Table>
<Caption>
SUMMARY OF INVESTMENTS BY INDUSTRY CLASSIFICATION AS OF 8/31/07
(continued from previous page)
Air Freight & Logistics 0.5
Multi-Line Insurance 0.5
Asset Management & Custody Banks 0.5
Life & Health Insurance 0.5
Real Estate Management & Development 0.5
Electric Utilities 0.5
Electronic Manufacturing Services 0.5
Specialized Consumer Services 0.5
-----
Total Long-Term Investments 99.2
Total Repurchase Agreements 2.0
Liabilities in Excess of Other Assets (1.2)
-----
Net Assets 100.0%
</Table>
Subject to change daily. Provided for informational purposes only and should not
be deemed as a recommendation to buy or sell the securities mentioned or
securities in the industries shown above. All percentages are as a percentage of
net assets. Van Kampen is a wholly owned subsidiary of a global securities firm
which is engaged in a wide range of financial services including, for example,
securities trading and brokerage activities, investment banking, research and
analysis, financing and financial advisory services.
7
FOR MORE INFORMATION ABOUT PORTFOLIO HOLDINGS
Each Van Kampen fund provides a complete schedule of portfolio holdings
in its semiannual and annual reports within 60 days of the end of the
fund's second and fourth fiscal quarters. The semiannual reports and the
annual reports are filed electronically with the Securities and Exchange
Commission (SEC) on Form N-CSRS and Form N-CSR, respectively. Van Kampen
also delivers the semiannual and annual reports to fund shareholders, and
makes these reports available on its public Web site, www.vankampen.com.
In addition to the semiannual and annual reports that Van Kampen delivers
to shareholders and makes available through the Van Kampen public Web
site, each fund files a complete schedule of portfolio holdings with the
SEC for the fund's first and third fiscal quarters on Form N-Q. Van
Kampen does not deliver the reports for the first and third fiscal
quarters to shareholders, nor are the reports posted to the Van Kampen
public Web site. You may, however, obtain the Form N-Q filings (as well
as the Form N-CSR and N-CSRS filings) by accessing the SEC's Web site,
http://www.sec.gov. You may also review and copy them at the SEC's Public
Reference Room in Washington, DC. Information on the operation of the
SEC's Public Reference Room may be obtained by calling the SEC at (800)
SEC-0330. You can also request copies of these materials, upon payment of
a duplicating fee, by electronic request at the SEC's email address
(publicinfo@sec.gov) or by writing the Public Reference section of the
SEC, Washington, DC 20549-0102.
You may obtain copies of a fund's fiscal quarter filings by contacting
Van Kampen Client Relations at (800) 847-2424.
8
HOUSEHOLDING NOTICE
To reduce Fund expenses, the Fund attempts to eliminate duplicate
mailings to the same address. The Fund delivers a single copy of certain
shareholder documents to investors who share an address, even if the
accounts are registered under different names. The Fund's prospectuses
and shareholder reports (including annual privacy notices) will be
delivered to you in this manner indefinitely unless you instruct us
otherwise. You can request multiple copies of these documents by either
calling (800) 341-2911 or writing to Van Kampen Investor Services at 1
Parkview Plaza, P.O. Box 5555, Oakbrook Terrace, IL 60181. Once Investor
Services has received your instructions, we will begin sending individual
copies for each account within 30 days.
PROXY VOTING POLICY AND PROCEDURES AND PROXY VOTING RECORD
You may obtain a copy of the Fund's Proxy Voting Policy and Procedures
without charge, upon request, by calling toll free (800) 847-2424 or by
visiting our Web site at www.vankampen.com. It is also available on the
Securities and Exchange Commission's Web site at http://www.sec.gov.
You may obtain information regarding how the Fund voted proxies relating
to portfolio securities during the most recent twelve-month period ended
June 30 without charge by visiting our Web site at www.vankampen.com.
This information is also available on the Securities and Exchange
Commission's Web site at http://www.sec.gov.
9
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction
costs, including sales charges (loads) on purchase payments of Class A Shares
and contingent deferred sales charges on redemptions of Class B and Class C
Shares; and redemption fees; and (2) ongoing costs, including management fees;
distribution and service (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 3/1/07 - 8/31/07.
ACTUAL EXPENSE
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 rate of return of 5% per year before expenses, which is not
the Fund's actual return. The hypothetical account values and expenses may not
be used to estimate the actual ending account balance or expenses you paid for
the period. You may use this information to compare the ongoing cost of
investing in the Fund and other funds. To do so, compare this 5% hypothetical
example with the 5% hypothetical examples that appear in the shareholder reports
of the other funds.
Please note that the expenses shown in the 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 or redemption fees.
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.
<Table>
<Caption>
BEGINNING ENDING EXPENSES PAID
ACCOUNT VALUE ACCOUNT VALUE DURING PERIOD*
------------------------------------------------
3/1/07 8/31/07 3/1/07-8/31/07
Class A Actual................................ $1,000.00 $1,091.10 $5.80
Hypothetical................................ 1,000.00 1,019.66 5.60
(5% annual return before expenses)
Class B Actual................................ 1,000.00 1,087.03 9.78
Hypothetical................................ 1,000.00 1,015.83 9.45
(5% annual return before expenses)
Class C Actual................................ 1,000.00 1,087.00 9.78
Hypothetical................................ 1,000.00 1,015.83 9.45
(5% annual return before expenses)
Class I Actual................................ 1,000.00 1,092.42 4.48
Hypothetical................................ 1,000.00 1,020.92 4.33
(5% annual return before expenses)
Class R Actual................................ 1,000.00 1,089.68 7.06
Hypothetical................................ 1,000.00 1,018.45 6.82
(5% annual return before expenses)
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 1.10%, 1.86%,
1.86%, 0.85% and 1.34% for Class A, B, C, I and R Shares, respectively,
multiplied by the average account value over the period, multiplied by
184/365 (to reflect the one-half year period).
Assumes all dividends and distributions were reinvested.
10
Investment Advisory Agreement Approval
Both the Investment Company Act of 1940 and the terms of the Fund's investment
advisory agreement require that the investment advisory agreement between the
Fund and its investment adviser be approved annually both by a majority of the
Board of Trustees and by a majority of the independent trustees voting
separately.
At meetings held on April 17, 2007 and May 30, 2007, the Board of Trustees, and
the independent trustees voting separately, considered and ultimately determined
that the terms of the investment advisory agreement are fair and reasonable and
approved the continuance of the investment advisory agreement as being in the
best interests of the Fund and its shareholders. In making its determination,
the Board of Trustees considered materials that were specifically prepared by
the investment adviser at the request of the Board and Fund counsel, and by an
independent provider of investment company data contracted to assist the Board,
relating to the investment advisory agreement review process. The Board also
considered information received periodically about the portfolio, performance,
the investment strategy, portfolio management team and fees and expenses of the
Fund. The Board of Trustees considered the investment advisory agreement over a
period of several months and the trustees held sessions both with the investment
adviser and separate from the investment adviser in reviewing and considering
the investment advisory agreement.
In approving the investment advisory agreement, the Board of Trustees
considered, among other things, the nature, extent and quality of the services
provided by the investment adviser, the performance, fees and expenses of the
Fund compared to other similar funds and other products, the investment
adviser's expenses in providing the services and the profitability of the
investment adviser and its affiliated companies. The Board of Trustees
considered the extent to which any economies of scale experienced by the
investment adviser are shared with the Fund's shareholders, and the propriety of
existing and alternative breakpoints in the Fund's investment advisory fee
schedule. The Board of Trustees considered comparative advisory fees of the Fund
and other investment companies and/or other products at different asset levels,
and considered the trends in the industry versus historical and projected assets
of the Fund. The Board of Trustees also reviewed the benefit to the investment
adviser of receiving research paid for by Fund assets and the propriety of such
arrangements. The Board of Trustees evaluated other benefits the investment
adviser and its affiliates derive from their relationship with the Fund. The
Board of Trustees reviewed information about the foregoing factors and
considered changes, if any, in such information since its previous approval. The
Board of Trustees discussed the financial strength of the investment adviser and
its affiliated companies and the capability of the personnel of the investment
adviser, and specifically the strength and background of its portfolio
management personnel. The Board of Trustees reviewed the statutory and
11
regulatory requirements for approval and disclosure of investment advisory
agreements. The Board of Trustees, including the independent trustees, evaluated
all of the foregoing and does not believe any single factor or group of factors
control or dominate the review process, and, after considering all factors
together, has determined, in the exercise of its business judgment, that
approval of the investment advisory agreement is in the best interests of the
Fund and its shareholders. The following summary provides more detail on certain
matters considered but does not detail all matters considered.
Nature, Extent and Quality of the Services Provided. On a regular basis, the
Board of Trustees considers the roles and responsibilities of the investment
adviser as a whole and for those specific portfolio management, support and
trading functions servicing the Fund. The trustees discuss with the investment
adviser the resources available and used in managing the Fund. The Fund
discloses information about its portfolio management team members and their
experience in its prospectus. The trustees also discuss certain other services
which are provided on a cost-reimbursement basis by the investment adviser or
its affiliates to the Van Kampen funds including certain accounting,
administrative and legal services. The Board has determined that the nature,
extent and quality of the services provided by the investment adviser support
its decision to approve the investment advisory agreement.
Performance, Fees and Expenses of the Fund. On a regular basis, the Board of
Trustees reviews the performance, fees and expenses of the Fund compared to its
peers and to appropriate benchmarks. In addition, the Board spends more focused
time on the performance of the Fund and other funds in the Van Kampen complex,
paying specific attention to underperforming funds. The trustees discuss with
the investment adviser the performance goals and the actual results achieved in
managing the Fund. When considering a fund's performance, the trustees and the
investment adviser place emphasis on trends and longer-term returns (focusing on
one-year, three-year and five-year performance with special attention to
three-year performance) and, when a fund's weighted performance is under the
fund's benchmark, they discuss the causes and where necessary seek to make
specific changes to investment strategy or investment personnel. The Fund
discloses more information about its performance elsewhere in this report and in
the Fund's prospectus. The trustees discuss with the investment adviser the
level of advisory fees for this Fund relative to comparable funds and other
products advised by the adviser and others in the marketplace. The trustees
review not only the advisory fees but other fees and expenses (whether paid to
the adviser, its affiliates or others) and the Fund's overall expense ratio. The
Fund discloses more information about its fees and expenses in its prospectus.
The Board has determined that the performance, fees and expenses of the Fund
support its decision to approve the investment advisory agreement.
Investment Adviser's Expenses in Providing the Service and Profitability. At
least annually, the trustees review the investment adviser's expenses in
providing
12
services to the Fund and other funds advised by the investment adviser and the
profitability of the investment adviser. These profitability reports are put
together by the investment adviser with the oversight of the Board. The trustees
discuss with the investment adviser its revenues and expenses, including among
other things, revenues for advisory services, portfolio management-related
expenses, revenue sharing arrangement costs and allocated expenses both on an
aggregate basis and per fund. The Board has determined that the analysis of the
investment adviser's expenses and profitability support its decision to approve
the investment advisory agreement.
Economies of Scale. On a regular basis, the Board of Trustees considers the size
and growth prospects of the Fund and how that relates to the Fund's expense
ratio and particularly the Fund's advisory fee rate. In conjunction with its
review of the investment adviser's profitability, the trustees discuss with the
investment adviser how more (or less) assets can affect the efficiency or
effectiveness of managing the Fund's portfolio and whether the advisory fee
level is appropriate relative to current and projected asset levels and/or
whether the advisory fee structure reflects economies of scale as asset levels
change. The Board has determined that its review of the actual and potential
economies of scale of the Fund support its decision to approve the investment
advisory agreement.
Other Benefits of the Relationship. On a regular basis, the Board of Trustees
considers other benefits to the investment adviser and its affiliates derived
from its relationship with the Fund and other funds advised by the investment
adviser. These benefits include, among other things, fees for transfer agency
services provided to the funds, in certain cases research received by the
adviser generated from commission dollars spent on funds' portfolio trading, and
in certain cases distribution or service related fees related to funds' sales.
The trustees review with the investment adviser each of these arrangements and
the reasonableness of its costs relative to the services performed. The Board
has determined that the other benefits received by the investment adviser or its
affiliates support its decision to approve the investment advisory agreement.
13
VAN KAMPEN STRATEGIC GROWTH FUND
PORTFOLIO OF INVESTMENTS -- AUGUST 31, 2007
<Table>
<Caption>
NUMBER OF
DESCRIPTION SHARES VALUE
- ----------------------------------------------------------------------------------------
COMMON STOCKS 99.2%
AEROSPACE & DEFENSE 5.6%
Alliant Techsystems, Inc. (a)............................... 250,000 $ 26,327,500
BE Aerospace, Inc. (a)...................................... 500,000 19,485,000
Goodrich Corp. ............................................. 450,000 28,422,000
Honeywell International, Inc. .............................. 800,000 44,920,000
Precision Castparts Corp. .................................. 700,000 91,217,000
--------------
210,371,500
--------------
AIR FREIGHT & LOGISTICS 0.5%
C.H. Robinson Worldwide, Inc. .............................. 400,000 19,616,000
--------------
APPAREL, ACCESSORIES & LUXURY GOODS 2.0%
Coach, Inc. (a)............................................. 600,000 26,718,000
Phillips-Van Heusen Corp. .................................. 550,000 32,026,500
Under Armour, Inc., Class A (a)............................. 250,000 16,252,500
--------------
74,997,000
--------------
APPAREL RETAIL 1.3%
Guess?, Inc. ............................................... 400,000 21,200,000
TJX Cos., Inc. ............................................. 900,000 27,441,000
--------------
48,641,000
--------------
APPLICATION SOFTWARE 0.7%
NAVTEQ Corp. (a)............................................ 450,000 28,350,000
--------------
ASSET MANAGEMENT & CUSTODY BANKS 0.5%
Janus Capital Group, Inc. .................................. 700,000 18,613,000
--------------
AUTO PARTS & EQUIPMENT 0.9%
Johnson Controls, Inc. ..................................... 300,000 33,930,000
--------------
BIOTECHNOLOGY 4.0%
Celgene Corp. (a)........................................... 1,000,000 64,210,000
Gilead Sciences, Inc. (a)................................... 1,600,000 58,192,000
Vertex Pharmaceuticals, Inc. (a)............................ 700,000 27,272,000
--------------
149,674,000
--------------
COMMUNICATIONS EQUIPMENT 8.6%
Cisco Systems, Inc. (a)..................................... 2,450,000 78,204,000
CommScope, Inc. (a)......................................... 300,000 16,980,000
Corning, Inc. .............................................. 1,500,000 35,055,000
Juniper Networks, Inc. (a).................................. 1,000,000 32,920,000
Nokia Oyj--ADR (Finland).................................... 1,800,000 59,184,000
QUALCOMM, Inc. ............................................. 700,000 27,923,000
Research In Motion Ltd. (Canada) (a)........................ 600,000 51,246,000
Riverbed Technology, Inc. (a)............................... 500,000 22,200,000
--------------
323,712,000
--------------
COMPUTER & ELECTRONICS RETAIL 0.9%
GameStop Corp., Class A (a)................................. 650,000 32,591,000
--------------
</Table>
14 See Notes to Financial Statements
VAN KAMPEN STRATEGIC GROWTH FUND
PORTFOLIO OF INVESTMENTS -- AUGUST 31, 2007 continued
<Table>
<Caption>
NUMBER OF
DESCRIPTION SHARES VALUE
- ----------------------------------------------------------------------------------------
COMPUTER HARDWARE 7.5%
Apple, Inc. (a)............................................. 700,000 $ 96,936,000
Dell, Inc. (a).............................................. 1,400,000 39,550,000
Hewlett-Packard Co. ........................................ 1,900,000 93,765,000
IBM Corp. .................................................. 450,000 52,510,500
--------------
282,761,500
--------------
COMPUTER STORAGE & PERIPHERALS 1.7%
EMC Corp. (a)............................................... 1,600,000 31,456,000
SanDisk Corp. (a)........................................... 600,000 33,636,000
--------------
65,092,000
--------------
CONSTRUCTION & FARM MACHINERY & HEAVY TRUCKS 2.5%
Cummins, Inc. .............................................. 200,000 23,684,000
Deere & Co. ................................................ 350,000 47,621,000
Manitowoc Co., Inc. ........................................ 300,000 23,847,000
--------------
95,152,000
--------------
DIVERSIFIED METALS & MINING 1.0%
Southern Copper Corp. ...................................... 350,000 36,837,500
--------------
DRUG RETAIL 1.4%
CVS Caremark Corp. ......................................... 1,350,000 51,057,000
--------------
ELECTRIC UTILITIES 0.5%
Exelon Corp. ............................................... 250,000 17,667,500
--------------
ELECTRONIC MANUFACTURING SERVICES 0.5%
Trimble Navigation Ltd. (a)................................. 500,000 17,655,000
--------------
FERTILIZERS & AGRICULTURAL CHEMICALS 1.8%
Monsanto Co. ............................................... 1,000,000 69,740,000
--------------
FOOTWEAR 1.2%
Crocs, Inc. (a)............................................. 450,000 26,568,000
NIKE, Inc., Class B......................................... 350,000 19,719,000
--------------
46,287,000
--------------
HEALTH CARE EQUIPMENT 3.1%
Baxter International, Inc. ................................. 1,250,000 68,450,000
Hologic, Inc. (a)........................................... 900,000 47,835,000
--------------
116,285,000
--------------
HEAVY ELECTRICAL EQUIPMENT 2.0%
ABB Ltd.--ADR (Switzerland)................................. 3,000,000 73,980,000
--------------
HOUSEHOLD PRODUCTS 1.5%
Energizer Holdings, Inc. (a)................................ 200,000 21,186,000
Procter & Gamble Co. ....................................... 550,000 35,920,500
--------------
57,106,500
--------------
HYPERMARKETS & SUPER CENTERS 1.2%
Costco Wholesale Corp. ..................................... 750,000 46,312,500
--------------
</Table>
See Notes to Financial Statements 15
VAN KAMPEN STRATEGIC GROWTH FUND
PORTFOLIO OF INVESTMENTS -- AUGUST 31, 2007 continued
<Table>
<Caption>
NUMBER OF
DESCRIPTION SHARES VALUE
- ----------------------------------------------------------------------------------------
INDUSTRIAL CONGLOMERATES 1.7%
3M Co. ..................................................... 450,000 $ 40,945,500
McDermott International, Inc. (Panama) (a).................. 250,000 23,997,500
--------------
64,943,000
--------------
INTEGRATED OIL & GAS 2.3%
Exxon Mobil Corp. .......................................... 700,000 60,011,000
Occidental Petroleum Corp. ................................. 500,000 28,345,000
--------------
88,356,000
--------------
INTEGRATED TELECOMMUNICATION SERVICES 1.3%
AT&T, Inc. ................................................. 1,200,000 47,844,000
--------------
INTERNET RETAIL 1.3%
Amazon.com, Inc. (a)........................................ 350,000 27,968,500
Priceline.com, Inc. (a)..................................... 250,000 20,745,000
--------------
48,713,500
--------------
INTERNET SOFTWARE & SERVICES 3.8%
Baidu.com, Inc.--ADR (Cayman Islands) (a)................... 100,000 20,820,000
Google, Inc., Class A (a)................................... 200,000 103,050,000
VeriSign, Inc. (a).......................................... 600,000 19,320,000
--------------
143,190,000
--------------
INVESTMENT BANKING & BROKERAGE 2.1%
Charles Schwab Corp. ....................................... 2,750,000 54,450,000
Goldman Sachs Group, Inc. .................................. 150,000 26,401,500
--------------
80,851,500
--------------
IT CONSULTING & OTHER SERVICES 1.6%
Accenture Ltd., Class A (Bermuda)........................... 1,500,000 61,815,000
--------------
LIFE & HEALTH INSURANCE 0.5%
Prudential Financial, Inc. ................................. 200,000 17,956,000
--------------
MULTI-LINE INSURANCE 0.5%
Loews Corp. ................................................ 400,000 18,804,000
--------------
OIL & GAS EQUIPMENT & SERVICES 3.9%
Cameron International Corp. (a)............................. 550,000 44,973,500
National-Oilwell Varco, Inc. (a)............................ 200,000 25,600,000
Schlumberger Ltd. (Netherlands Antilles).................... 800,000 77,200,000
--------------
147,773,500
--------------
OIL & GAS EXPLORATION & PRODUCTION 0.8%
Devon Energy Corp. ......................................... 400,000 30,124,000
--------------
OIL & GAS REFINING & MARKETING 0.5%
Valero Energy Corp. ........................................ 300,000 20,553,000
--------------
</Table>
16 See Notes to Financial Statements
VAN KAMPEN STRATEGIC GROWTH FUND
PORTFOLIO OF INVESTMENTS -- AUGUST 31, 2007 continued
<Table>
<Caption>
NUMBER OF
DESCRIPTION SHARES VALUE
- ----------------------------------------------------------------------------------------
OTHER DIVERSIFIED FINANCIAL SERVICES 1.2%
Bank of America Corp. ...................................... 350,000 $ 17,738,000
JPMorgan Chase & Co. ....................................... 600,000 26,712,000
--------------
44,450,000
--------------
PHARMACEUTICALS 7.2%
Abbott Laboratories......................................... 1,050,000 54,505,500
Roche Holdings AG--ADR (Switzerland)........................ 1,000,000 86,898,900
Schering-Plough Corp. ...................................... 2,000,000 60,040,000
Shire PLC--ADR (United Kingdom)............................. 900,000 70,866,000
--------------
272,310,400
--------------
RAILROADS 0.8%
Canadian National Railway Co. (Canada)...................... 600,000 31,590,000
--------------
REAL ESTATE MANAGEMENT & DEVELOPMENT 0.5%
CB Richard Ellis Group, Inc., Class A (a)................... 600,000 17,712,000
--------------
RESTAURANTS 2.0%
McDonald's Corp. ........................................... 1,500,000 73,875,000
--------------
SEMICONDUCTOR EQUIPMENT 2.2%
KLA-Tencor Corp. ........................................... 550,000 31,608,500
MEMC Electronic Materials, Inc. (a)......................... 500,000 30,710,000
Varian Semiconductor Equipment Associates, Inc. (a)......... 350,000 19,470,500
--------------
81,789,000
--------------
SEMICONDUCTORS 4.2%
Altera Corp. ............................................... 850,000 20,238,500
Intel Corp. ................................................ 3,000,000 77,250,000
Intersil Corp., Class A..................................... 600,000 19,992,000
Texas Instruments, Inc. .................................... 1,200,000 41,088,000
--------------
158,568,500
--------------
SOFT DRINKS 1.5%
PepsiCo, Inc. .............................................. 850,000 57,825,500
--------------
SPECIALIZED CONSUMER SERVICES 0.5%
Sotheby's................................................... 400,000 17,312,000
--------------
SPECIALIZED FINANCE 0.8%
IntercontinentalExchange, Inc. (a).......................... 200,000 29,174,000
--------------
SPECIALTY STORES 1.0%
Dick's Sporting Goods, Inc. (a)............................. 214,100 13,895,090
Tiffany & Co. .............................................. 500,000 25,665,000
--------------
39,560,090
--------------
</Table>
See Notes to Financial Statements 17
VAN KAMPEN STRATEGIC GROWTH FUND
PORTFOLIO OF INVESTMENTS -- AUGUST 31, 2007 continued
<Table>
<Caption>
NUMBER OF
DESCRIPTION SHARES VALUE
- ----------------------------------------------------------------------------------------
SYSTEMS SOFTWARE 2.4%
Microsoft Corp. ............................................ 1,500,000 $ 43,095,000
Oracle Corp. (a)............................................ 2,000,000 40,560,000
VMware, Inc., Class A (a)................................... 103,700 7,143,893
--------------
90,798,893
--------------
WIRELESS TELECOMMUNICATION SERVICES 3.7%
America Movil SA de CV, Ser L--ADR (Mexico)................. 1,500,000 90,690,000
Vimpel-Communications--ADR (Russia)......................... 2,000,000 48,800,000
--------------
139,490,000
--------------
TOTAL LONG-TERM INVESTMENTS 99.2%
(Cost $3,071,684,613)................................................ 3,741,807,883
--------------
REPURCHASE AGREEMENTS 2.0%
Banc of America Securities ($25,033,238 par collateralized by U.S.
Government obligations in a pooled cash account, interest rate of
5.30%, dated 08/31/07, to be sold on 09/04/07 at $25,047,980)........ 25,033,238
Citigroup Global Markets, Inc. ($22,251,767 par collateralized by U.S.
Government obligations in a pooled cash account, interest rate of
5.25%, dated 08/31/07, to be sold on 09/04/07 at $22,264,747).......... 22,251,767
State Street Bank & Trust Co. ($27,025,995 par collateralized by U.S.
Government obligations in a pooled cash account, interest rate of
4.83%, dated 08/31/07, to be sold on 09/04/07 at $27,040,499)........ 27,025,995
--------------
TOTAL REPURCHASE AGREEMENTS
(Cost $74,311,000)................................................... 74,311,000
--------------
TOTAL INVESTMENTS 101.2%
(Cost $3,145,995,613)................................................ 3,816,118,883
LIABILITIES IN EXCESS OF OTHER ASSETS (1.2%).......................... (44,459,844)
--------------
NET ASSETS 100.0%..................................................... $3,771,659,039
==============
</Table>
Percentages are calculated as a percentage of net assets.
(a) Non-income producing security as this stock currently does not declare
income dividends.
ADR--American Depositary Receipt
18 See Notes to Financial Statements
VAN KAMPEN STRATEGIC GROWTH FUND
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
August 31, 2007
<Table>
ASSETS:
Total Investments (Cost $3,145,995,613)..................... $ 3,816,118,883
Cash........................................................ 320
Receivables:
Investments Sold.......................................... 39,833,093
Dividends................................................. 2,281,250
Fund Shares Sold.......................................... 689,193
Interest.................................................. 10,556
Other....................................................... 633,216
---------------
Total Assets............................................ 3,859,566,511
---------------
LIABILITIES:
Payables:
Investments Purchased..................................... 72,209,894
Fund Shares Repurchased................................... 7,690,434
Distributor and Affiliates................................ 3,627,192
Investment Advisory Fee................................... 1,419,138
Trustees' Deferred Compensation and Retirement Plans........ 729,403
Accrued Expenses............................................ 2,231,411
---------------
Total Liabilities....................................... 87,907,472
---------------
NET ASSETS.................................................. $ 3,771,659,039
===============
NET ASSETS CONSIST OF:
Capital (Par value of $0.01 per share with an unlimited
number of shares authorized).............................. $ 8,109,245,832
Net Unrealized Appreciation................................. 670,123,270
Accumulated Net Investment Loss............................. (671,376)
Accumulated Net Realized Loss............................... (5,007,038,687)
---------------
NET ASSETS.................................................. $ 3,771,659,039
===============
MAXIMUM OFFERING PRICE PER SHARE:
Class A Shares:
Net asset value and redemption price per share (Based on
net assets of $2,546,740,770 and 54,660,272 shares of
beneficial interest issued and outstanding)............. $ 46.59
Maximum sales charge (5.75%* of offering price)......... 2.84
---------------
Maximum offering price to public........................ $ 49.43
===============
Class B Shares:
Net asset value and offering price per share (Based on
net assets of $982,228,027 and 25,045,922 shares of
beneficial interest issued and outstanding)............. $ 39.22
===============
Class C Shares:
Net asset value and offering price per share (Based on
net assets of $190,230,926 and 4,728,598 shares of
beneficial interest issued and outstanding)............. $ 40.23
===============
Class I Shares:
Net asset value and offering price per share (Based on
net assets of $50,006,036 and 1,055,043 shares of
beneficial interest issued and outstanding)............. $ 47.40
===============
Class R Shares:
Net asset value and offering price per share (Based on
net assets of $2,453,280 and 53,276 shares of beneficial
interest issued and outstanding)........................ $ 46.05
===============
</Table>
* On sales of $50,000 or more, the sales charge will be reduced.
See Notes to Financial Statements 19
VAN KAMPEN STRATEGIC GROWTH FUND
FINANCIAL STATEMENTS continued
Statement of Operations
For the Year Ended August 31, 2007
<Table>
INVESTMENT INCOME:
Dividends (Net of foreign withholding taxes of $515,097).... $ 34,043,468
Interest.................................................... 6,607,546
------------
Total Income.............................................. 40,651,014
------------
EXPENSES:
Distribution (12b-1) and Service Fees
Class A................................................... 6,615,796
Class B................................................... 11,361,882
Class C................................................... 2,142,151
Class R................................................... 8,971
Investment Advisory Fee..................................... 18,361,091
Transfer Agent Fees......................................... 15,430,987
Reports to Shareholders..................................... 971,577
Accounting and Administrative Expenses...................... 491,426
Custody..................................................... 189,042
Professional Fees........................................... 171,388
Trustees' Fees and Related Expenses......................... 119,786
Registration Fees........................................... 101,479
Other....................................................... 150,891
------------
Total Expenses.......................................... 56,116,467
Less Credits Earned on Cash Balances.................... 162,291
------------
Net Expenses............................................ 55,954,176
------------
NET INVESTMENT LOSS......................................... $(15,303,162)
============
REALIZED AND UNREALIZED GAIN/LOSS:
Realized Gain/Loss:
Investments............................................... $418,964,548
Foreign Currency Transactions............................. (135)
------------
Net Realized Gain........................................... 418,964,413
------------
Unrealized Appreciation/Depreciation:
Beginning of the Period................................... 390,690,115
End of the Period......................................... 670,123,270
------------
Net Unrealized Appreciation During the Period............... 279,433,155
------------
NET REALIZED AND UNREALIZED GAIN............................ $698,397,568
============
NET INCREASE IN NET ASSETS FROM OPERATIONS.................. $683,094,406
============
</Table>
20 See Notes to Financial Statements
VAN KAMPEN STRATEGIC GROWTH FUND
FINANCIAL STATEMENTS continued
Statements of Changes in Net Assets
<Table>
<Caption>
FOR THE FOR THE
YEAR ENDED YEAR ENDED
AUGUST 31, 2007 AUGUST 31, 2006
----------------------------------
FROM INVESTMENT ACTIVITIES:
Operations:
Net Investment Loss.................................... $ (15,303,162) $ (28,467,728)
Net Realized Gain...................................... 418,964,413 602,318,022
Net Unrealized Appreciation/Depreciation During
the Period........................................... 279,433,155 (592,957,591)
--------------- ---------------
NET CHANGE IN NET ASSETS FROM INVESTMENT ACTIVITIES.... 683,094,406 (19,107,297)
--------------- ---------------
FROM CAPITAL TRANSACTIONS:
Proceeds from Shares Sold.............................. 361,164,686 511,765,322
Cost of Shares Repurchased............................. (1,533,900,373) (1,593,108,658)
--------------- ---------------
NET CHANGE IN NET ASSETS FROM CAPITAL TRANSACTIONS..... (1,172,735,687) (1,081,343,336)
--------------- ---------------
TOTAL DECREASE IN NET ASSETS........................... (489,641,281) (1,100,450,633)
NET ASSETS:
Beginning of the Period................................ 4,261,300,320 5,361,750,953
--------------- ---------------
End of the Period (Including accumulated net investment
loss of $671,376 and $602,271, respectively)......... $ 3,771,659,039 $ 4,261,300,320
=============== ===============
</Table>
See Notes to Financial Statements 21
VAN KAMPEN STRATEGIC GROWTH FUND
FINANCIAL HIGHLIGHTS
THE FOLLOWING SCHEDULE PRESENTS FINANCIAL HIGHLIGHTS FOR ONE SHARE OF THE FUND
OUTSTANDING THROUGHOUT THE PERIODS INDICATED.
<Table>
<Caption>
YEAR ENDED AUGUST 31,
CLASS A SHARES --------------------------------------------------------
2007 2006 2005 2004 2003
--------------------------------------------------------
NET ASSET VALUE, BEGINNING OF THE
PERIOD.............................. $ 39.41 $ 39.84 $ 34.14 $ 34.08 $ 30.96
-------- -------- -------- -------- --------
Net Investment Loss (a)............. (0.05) (0.12) -0-(c) (0.16) (0.18)
Net Realized and Unrealized
Gain/Loss......................... 7.23 (0.31) 5.70 0.22 3.30
-------- -------- -------- -------- --------
Total from Investment Operations...... 7.18 (0.43) 5.70 0.06 3.12
-------- -------- -------- -------- --------
NET ASSET VALUE, END OF THE PERIOD.... $ 46.59 $ 39.41 $ 39.84 $ 34.14 $ 34.08
======== ======== ======== ======== ========
Total Return (b)...................... 18.22% -1.08% 16.70% 0.18% 10.08%
Net Assets at End of the Period (In
millions)........................... $2,546.7 $2,727.5 $3,240.5 $3,663.9 $4,222.8
Ratio of Expenses to Average Net
Assets.............................. 1.13% 1.09% 1.14% 1.08% 1.15%
Ratio of Net Investment Loss to
Average Net Assets.................. (0.13%) (0.29%) (0.00%) (0.46%) (0.61%)
Portfolio Turnover.................... 111% 109% 100% 177% 180%
</Table>
(a) Based on average shares outstanding.
(b) Assumes reinvestment of all distributions for the period and does not
include payment of the maximum sales charge of 5.75% or contingent deferred
sales charge (CDSC). On purchases of $1 million or more, a CDSC of 1% may be
imposed on certain redemptions made within eighteen months of purchase. If
the sales charges were included, total returns would be lower. These returns
include combined Rule 12b-1 fees and service fees of up to .25% and do not
reflect the deduction of taxes that a shareholder would pay on Fund
distributions or the redemption of Fund shares.
(c) Amount is less than $.01.
22 See Notes to Financial Statements
VAN KAMPEN STRATEGIC GROWTH FUND
FINANCIAL HIGHLIGHTS continued
THE FOLLOWING SCHEDULE PRESENTS FINANCIAL HIGHLIGHTS FOR ONE SHARE OF THE FUND
OUTSTANDING THROUGHOUT THE PERIODS INDICATED.
<Table>
<Caption>
YEAR ENDED AUGUST 31,
CLASS B SHARES ------------------------------------------------------
2007 2006 2005 2004 2003
------------------------------------------------------
NET ASSET VALUE, BEGINNING OF THE
PERIOD............................... $33.42 $ 34.05 $ 29.40 $ 29.57 $ 27.07
------ -------- -------- -------- --------
Net Investment Loss (a).............. (0.33) (0.37) (0.25) (0.38) (0.36)
Net Realized and Unrealized
Gain/Loss.......................... 6.13 (0.26) 4.90 0.21 2.86
------ -------- -------- -------- --------
Total from Investment Operations....... 5.80 (0.63) 4.65 (0.17) 2.50
------ -------- -------- -------- --------
NET ASSET VALUE, END OF THE PERIOD..... $39.22 $ 33.42 $ 34.05 $ 29.40 $ 29.57
====== ======== ======== ======== ========
Total Return (b)....................... 17.35% -1.85% 15.82% -0.57% 9.24%
Net Assets at End of the Period (In
millions)............................ $982.2 $1,237.7 $1,731.5 $2,010.4 $2,346.3
Ratio of Expenses to Average
Net Assets........................... 1.89% 1.85% 1.90% 1.85% 1.91%
Ratio of Net Investment Loss to Average
Net Assets........................... (0.89%) (1.05%) (0.76%) (1.23%) (1.37%)
Portfolio Turnover..................... 111% 109% 100% 177% 180%
</Table>
(a) Based on average shares outstanding.
(b) Assumes reinvestment of all distributions for the period and does not
include payment of the maximum CDSC of 5%, charged on certain redemptions
made within one year of purchase and declining to 0% after the fifth year.
If the sales charge was included, total returns would be lower. These
returns include combined Rule 12b-1 fees and service fees of up to 1% and do
not reflect the deduction of taxes that a shareholder would pay on Fund
distributions or the redemption of Fund shares.
See Notes to Financial Statements 23
VAN KAMPEN STRATEGIC GROWTH FUND
FINANCIAL HIGHLIGHTS continued
THE FOLLOWING SCHEDULE PRESENTS FINANCIAL HIGHLIGHTS FOR ONE SHARE OF THE FUND
OUTSTANDING THROUGHOUT THE PERIODS INDICATED.
<Table>
<Caption>
YEAR ENDED AUGUST 31,
CLASS C SHARES ----------------------------------------------
2007 2006 2005 2004 2003
----------------------------------------------
NET ASSET VALUE, BEGINNING OF THE PERIOD.... $34.28 $34.92 $30.16 $30.34 $27.75
------ ------ ------ ------ ------
Net Investment Loss (a)................... (0.34) (0.38) (0.25) (0.39) (0.36)
Net Realized and Unrealized Gain/Loss..... 6.29 (0.26) 5.01 0.21 2.95
------ ------ ------ ------ ------
Total from Investment Operations............ 5.95 (0.64) 4.76 (0.18) 2.59
------ ------ ------ ------ ------
NET ASSET VALUE, END OF THE PERIOD.......... $40.23 $34.28 $34.92 $30.16 $30.34
====== ====== ====== ====== ======
Total Return (b)............................ 17.36% -1.83% 15.78% -0.59% 9.33%(c)
Net Assets at End of the Period (In
millions)................................. $190.2 $238.4 $332.8 $430.2 $570.1
Ratio of Expenses to Average Net Assets..... 1.89% 1.85% 1.90% 1.85% 1.91%
Ratio of Net Investment Loss to Average Net
Assets.................................... (0.89%) (1.05%) (0.75%) (1.23%) (1.34%)(c)
Portfolio Turnover.......................... 111% 109% 100% 177% 180%
</Table>
(a) Based on average shares outstanding.
(b) Assumes reinvestment of all distributions for the period and does not
include payment of the maximum CDSC of 1%, charged on certain redemptions
made within one year of purchase. If the sales charge was included, total
returns would be lower. These returns include combined Rule 12b-1 fees and
service fees of up to 1% and do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption on Fund
shares.
(c) Certain non-recurring payments were made to Class C Shares, resulting in an
increase to the Total Return and Ratio of Net Investment Loss to Average Net
Assets of .03%.
24 See Notes to Financial Statements
VAN KAMPEN STRATEGIC GROWTH FUND
FINANCIAL HIGHLIGHTS continued
THE FOLLOWING SCHEDULE PRESENTS FINANCIAL HIGHLIGHTS FOR ONE SHARE OF THE FUND
OUTSTANDING THROUGHOUT THE PERIODS INDICATED.
<Table>
<Caption>
YEAR ENDED AUGUST 31,
CLASS I SHARES ----------------------------------------------
2007 2006 2005 2004 2003
----------------------------------------------
NET ASSET VALUE, BEGINNING OF THE PERIOD.... $39.99 $40.33 $34.47 $34.33 $31.10
------ ------ ------ ------ ------
Net Investment Income/Loss (a)............ 0.05 (0.01) 0.07 (0.08) (0.11)
Net Realized and Unrealized Gain/Loss..... 7.36 (0.33) 5.79 0.22 3.34
------ ------ ------ ------ ------
Total from Investment Operations............ 7.41 (0.34) 5.86 0.14 3.23
------ ------ ------ ------ ------
NET ASSET VALUE, END OF THE PERIOD.......... $47.40 $39.99 $40.33 $34.47 $34.33
====== ====== ====== ====== ======
Total Return (b)............................ 18.53% -0.84% 17.00% 0.41% 10.39%
Net Assets at End of the Period (In
millions)................................. $ 50.0 $ 55.6 $ 55.0 $ 31.8 $ 33.9
Ratio of Expenses to Average Net Assets..... 0.88% 0.84% 0.90% 0.84% 0.90%
Ratio of Net Investment Income/Loss to
Average Net Assets........................ 0.12% (0.03%) 0.20% (0.21%) (0.36%)
Portfolio Turnover.......................... 111% 109% 100% 177% 180%
</Table>
(a) Based on average shares outstanding.
(b) Assumes reinvestment of all distributions for the period. These returns do
not reflect the deduction of taxes that a shareholder would pay on Fund
distributions or the redemptions of Fund shares.
See Notes to Financial Statements 25
VAN KAMPEN STRATEGIC GROWTH FUND
FINANCIAL HIGHLIGHTS continued
THE FOLLOWING SCHEDULE PRESENTS FINANCIAL HIGHLIGHTS FOR ONE SHARE OF THE FUND
OUTSTANDING THROUGHOUT THE PERIODS INDICATED.
<Table>
<Caption>
OCTOBER 1, 2002
(COMMENCEMENT
YEAR ENDED AUGUST 31, OF INVESTMENT
CLASS R SHARES -------------------------------------- OPERATIONS) TO
2007 2006 2005 2004 AUGUST 31, 2003
---------------------------------------------------------
NET ASSET VALUE, BEGINNING OF THE
PERIOD............................. $39.08 $39.58 $34.02 $34.04 $29.94
------ ------ ------ ------ ------
Net Investment Loss (a)............ (0.14) (0.19) (0.04) (0.24) (0.24)
Net Realized and Unrealized
Gain/Loss........................ 7.11 (0.31) 5.60 0.22 4.34
------ ------ ------ ------ ------
Total from Investment Operations..... 6.97 (0.50) 5.56 (0.02) 4.10
------ ------ ------ ------ ------
NET ASSET VALUE, END OF THE PERIOD... $46.05 $39.08 $39.58 $34.02 $34.04
====== ====== ====== ====== ======
Total Return (b)..................... 17.84% -1.26%(c) 16.34% -0.06% 13.69%*
Net Assets at End of the Period (In
millions).......................... $ 2.5 $ 2.0 $ 2.0 $ 20.0 $ 0.5
Ratio of Expenses to Average Net
Assets............................. 1.38% 1.27%(c) 1.37% 1.33% 1.41%
Ratio of Net Investment Loss to
Average Net Assets................. (0.34%) (0.47%)(c) (0.11%) (0.65%) (0.85%)
Portfolio Turnover................... 111% 109% 100% 177% 180%
</Table>
* Non-Annualized
(a) Based on average shares outstanding.
(b) Assumes reinvestment of all distributions for the period. These returns
include combined Rule 12b-1 fees and service fees of up to .50% and do not
reflect the deduction of taxes that a shareholder would pay on Fund
distributions or the redemptions of Fund shares.
(c) The Total Return, Ratio of Expenses to Average Net Assets, and Ratio of Net
Investment Loss to Average Net Assets reflect actual 12b-1 fees of less than
.50%.
26 See Notes to Financial Statements
VAN KAMPEN STRATEGIC GROWTH FUND
NOTES TO FINANCIAL STATEMENTS -- AUGUST 31, 2007
1. SIGNIFICANT ACCOUNTING POLICIES
Van Kampen Strategic Growth Fund (the "Fund") is organized as a Delaware
statutory trust, and is registered as a diversified open-end management
investment company under the Investment Company Act of 1940 (the "1940 Act"), as
amended. The Fund's investment objective is capital appreciation. The Fund
commenced investment operations on October 2, 1970. The Fund offers Class A
Shares, Class B Shares, Class C Shares, Class I Shares and Class R Shares. Each
class of shares differs by its initial sales load, contingent deferred sales
charges, the allocation of class-specific expenses and voting rights on matters
affecting a single class.
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
preparation of financial statements in conformity with U.S. generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
A. SECURITY VALUATION Investments in securities listed on a securities exchange
are valued at their last sale price as of the close of such securities exchange.
Equity securities traded on NASDAQ are valued at the NASDAQ Official Closing
Price. Listed and unlisted securities for which the last sale price is not
available are valued at the mean of the last reported bid and asked prices. For
those securities where quotations or prices are not readily available,
valuations are determined in accordance with procedures established in good
faith by the Board of Trustees. Short-term securities with remaining maturities
of 60 days or less are valued at amortized cost, which approximates market
value.
B. SECURITY TRANSACTIONS Security transactions are recorded on a trade date
basis. Realized gains and losses are determined on an identified cost basis.
The Fund may invest in repurchase agreements, which are short-term
investments whereby the Fund acquires ownership of a debt security and the
seller agrees to repurchase the security at a future time and specified price.
The Fund may invest independently in repurchase agreements, or transfer
uninvested cash balances into a pooled cash account along with other investment
companies advised by Van Kampen Asset Management (the "Adviser") or its
affiliates, the daily aggregate of which is invested in repurchase agreements.
Repurchase agreements are fully collateralized by the underlying debt security.
The Fund will make payment for such securities only upon physical delivery or
evidence of book entry transfer to the account of the custodian bank. The seller
is required to maintain the value of the underlying security at not less than
the repurchase proceeds due the Fund.
C. INCOME AND EXPENSES Dividend income is recorded on the ex-dividend date and
interest income is recorded on an accrual basis. Income and expenses of the Fund
are allocated on a pro rata basis to each class of shares, except for
distribution and service fees and incremental transfer agency costs which are
unique to each class of shares.
D. FEDERAL INCOME TAXES It is the Fund's policy to comply with the requirements
of Subchapter M of the Internal Revenue Code applicable to regulated investment
companies
27
VAN KAMPEN STRATEGIC GROWTH FUND
NOTES TO FINANCIAL STATEMENTS -- AUGUST 31, 2007 continued
and to distribute substantially all of its taxable income to its shareholders.
Therefore, no provision for federal income taxes is required. The Fund may be
subject to taxes imposed by countries in which it invests. Such taxes are
generally based on income earned or gains realized or repatriated. Taxes are
accrued and applied to net investment income, net realized capital gains and net
unrealized appreciation, as applicable, as the income is earned or capital gains
are recorded.
The Fund intends to utilize provisions of the federal income tax laws which
allow it to carry a realized capital loss forward for eight years following the
year of loss and offset such losses against any future realized capital gains.
During the current fiscal year, the Fund utilized capital losses carried forward
of $419,806,059. At August 31, 2007, the Fund had an accumulated capital loss
carryforward for tax purposes of $5,006,227,572, which will expire according to
the following schedule.
<Table>
<Caption>
AMOUNT EXPIRATION
$2,253,729,859.............................................. August 31, 2010
2,752,497,713.............................................. August 31, 2011
</Table>
At August 31, 2007, the cost and related gross unrealized appreciation and
depreciation were as follows:
<Table>
Cost of investments for tax purposes........................ $3,146,806,727
==============
Gross tax unrealized appreciation........................... $ 713,965,120
Gross tax unrealized depreciation........................... (44,652,964)
--------------
Net tax unrealized appreciation on investments.............. $ 669,312,156
==============
</Table>
E. DISTRIBUTION OF INCOME AND GAINS The Fund declares and pays dividends at
least annually from net investment income and from net realized gains, if any.
Distributions from net realized gains for book purposes may include short-term
capital gains, which are included as ordinary income for tax purposes. There
were no distributions paid during the years ended August 31, 2007 and 2006.
Permanent differences, primarily due to a net operating loss, resulted in
the following reclassifications among the Fund's components of net assets at
August 31, 2007:
<Table>
<Caption>
ACCUMULATED NET ACCUMULATED NET
INVESTMENT LOSS REALIZED LOSS CAPITAL
--------------- --------------- ------------
$15,234,057 $30,532 $(15,264,589)
</Table>
As of August 31, 2007, there were no distributable earnings on a tax basis.
Net realized gains or losses may differ for financial reporting and tax
purposes primarily as a result of the deferral of losses relating to wash sales
transactions.
F. EXPENSE REDUCTIONS During the year ended August 31, 2007, the Fund's custody
fee was reduced by $162,291 as a result of credits earned on cash balances.
G. FOREIGN CURRENCY TRANSLATION The market value of foreign securities, forward
foreign currency contracts and other assets and liabilities denominated in a
foreign currency are
28
VAN KAMPEN STRATEGIC GROWTH FUND
NOTES TO FINANCIAL STATEMENTS -- AUGUST 31, 2007 continued
translated into U.S. dollars at the mean of the quoted bid and ask prices of
such currencies against the U.S. dollar. Purchases and sales of portfolio
securities are translated at the rate of exchange prevailing when such
securities were acquired or sold. The cost of securities is determined using
historical exchange rates. Gains and losses on the sale of securities are not
segregated for financial reporting purposes between amounts arising from the
changes in exchange rates and amounts arising from changes in the market prices
of securities. Realized gains and losses on foreign currency include the net
realized amount from the sale of foreign currency and the amount realized
between trade date and settlement date on securities transactions. Income and
expenses are translated at rates prevailing when accrued.
2. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES
Under the terms of the Fund's Investment Advisory Agreement, the Adviser will
provide investment advice and facilities to the Fund for an annual fee payable
monthly as follows:
<Table>
<Caption>
AVERAGE DAILY NET ASSETS % PER ANNUM
First $350 million.......................................... .575%
Next $350 million........................................... .525%
Next $350 million........................................... .475%
Over $1.05 billion.......................................... .425%
</Table>
For the year ended August 31, 2007, the Fund recognized expenses of
approximately $97,400 representing legal services provided by Skadden, Arps,
Slate, Meagher & Flom LLP, counsel to the Fund, of which a trustee of the Fund
is a partner of such firm and he and his law firm provide legal services as
legal counsel to the Fund.
Under separate Accounting Services and Chief Compliance Officer (CCO)
Employment agreements, the Adviser provides accounting services and the CCO
provides compliance services to the Fund. The costs of these services are
allocated to each fund. For the year ended August 31, 2007, the Fund recognized
expenses of approximately $186,300 representing Van Kampen Investments Inc.'s or
its affiliates' (collectively "Van Kampen") cost of providing accounting
services to the Fund, as well as the salary, benefits and related costs of the
CCO and related support staff paid by Van Kampen. Services provided pursuant to
the Accounting Services and CCO Employment agreement are reported as part of
"Accounting and Administrative Expenses" on the Statement of Operations.
Van Kampen Investor Services Inc. (VKIS), an affiliate of the Adviser,
serves as the shareholder servicing agent for the Fund. For the year ended
August 31, 2007, the Fund recognized expenses of approximately $12,122,800
representing transfer agency fees paid to VKIS. Transfer agency fees are
determined through negotiations with the Fund's Board of Trustees.
Certain officers and trustees of the Fund are also officers and directors of
Van Kampen. The Fund does not compensate its officers or trustees who are also
officers of Van Kampen.
The Fund provides deferred compensation and retirement plans for its
trustees who are not officers of Van Kampen. Under the deferred compensation
plan, trustees may elect to defer all or a portion of their compensation.
Amounts deferred are retained by the Fund, and to the extent permitted by the
1940 Act, as amended, may be invested in the common shares of those funds
selected by the trustees. Investments in such funds of $559,859 are included in
"Other" assets on the Statement of Assets and Liabilities at August 31, 2007.
Appreciation/depreciation and distributions received from these investments are
recorded with an
29
VAN KAMPEN STRATEGIC GROWTH FUND
NOTES TO FINANCIAL STATEMENTS -- AUGUST 31, 2007 continued
offsetting increase/decrease in the deferred compensation obligation and do not
affect the net asset value of the Fund. Benefits under the retirement plan are
payable upon retirement for a ten-year period and are based upon each trustee's
years of service to the Fund. The maximum annual benefit per trustee under the
plan is $2,500.
For the year ended August 31, 2007, the Fund paid brokerage commissions to
Morgan Stanley DW Inc., an affiliate of the Adviser, totaling $557,685.
For the year ended August 31, 2007, Van Kampen, as Distributor for the Fund,
received net commissions on sales of the Fund's Class A Shares of approximately
$345,300 and contingent deferred sales charge (CDSC) on redeemed shares of
approximately $1,287,700. Sales charges do not represent expenses of the Fund.
3. CAPITAL TRANSACTIONS
For the years ended August 31, 2007 and 2006, transactions were as follows:
<Table>
<Caption>
FOR THE FOR THE
YEAR ENDED YEAR ENDED
AUGUST 31, 2007 AUGUST 31, 2006
------------------------------ ------------------------------
SHARES VALUE SHARES VALUE
Sales:
Class A.................... 6,544,066 $ 286,906,971 9,539,369 $ 395,313,593
Class B.................... 1,315,980 48,489,603 2,047,020 72,463,766
Class C.................... 222,561 8,351,927 394,163 14,361,191
Class I.................... 357,770 15,645,437 677,738 28,589,018
Class R.................... 39,604 1,770,748 25,099 1,037,754
----------- --------------- ----------- ---------------
Total Sales.................. 8,479,981 $ 361,164,686 12,683,389 $ 511,765,322
=========== =============== =========== ===============
Repurchases:
Class A.................... (21,091,877) $ (918,641,244) (21,666,389) $ (899,288,527)
Class B.................... (13,306,293) (491,004,084) (15,868,735) (558,115,587)
Class C.................... (2,448,340) (91,957,524) (2,967,859) (107,402,540)
Class I.................... (693,514) (30,627,206) (651,419) (27,373,544)
Class R.................... (38,720) (1,670,315) (22,588) (928,460)
----------- --------------- ----------- ---------------
Total Repurchases............ (37,578,744) $(1,533,900,373) (41,176,990) $(1,593,108,658)
=========== =============== =========== ===============
</Table>
4. REDEMPTION FEE
The Fund will assess a 2% redemption fee on the proceeds of Fund shares that are
redeemed (either by sale or exchange) within seven days of purchase. The
redemption fee is paid directly to the Fund and allocated on a pro rata basis to
each class of shares. For the year ended August 31, 2007, the Fund received
redemption fees of approximately $15,100 which are reported as part of "Cost of
Shares Repurchased" on the Statement of Changes in Net Assets. The per share
impact from redemption fees paid to the Fund was less than $0.01.
5. INVESTMENT TRANSACTIONS
During the period, the cost of purchases and proceeds from sales of investments,
excluding short-term investments, were $4,368,731,126 and $5,265,376,130,
respectively.
30
VAN KAMPEN STRATEGIC GROWTH FUND
NOTES TO FINANCIAL STATEMENTS -- AUGUST 31, 2007 continued
6. DISTRIBUTION AND SERVICE PLANS
Shares of the Fund are distributed by Van Kampen Funds Inc. (the "Distributor"),
an affiliate of the Adviser. The Fund has adopted a distribution plan pursuant
to Rule 12b-1 under the 1940 Act, as amended, and a service plan (collectively,
the "Plans") for Class A Shares, Class B Shares, Class C Shares and Class R
Shares to compensate the Distributor for the sale, distribution, shareholder
servicing and maintenance of shareholder accounts for these shares. Under the
Plans, the Fund will incur annual fees of up to .25% of Class A average daily
net assets, up to 1.00% each of Class B and Class C average daily net assets and
up to .50% of Class R average daily net assets. These fees are accrued daily and
paid to the Distributor monthly.
The amount of distribution expenses incurred by the Distributor and not yet
reimbursed ("unreimbursed receivable") was approximately $3,919,800 and
$1,476,600 for Class B and Class C Shares, respectively. These amounts may be
recovered from future payments under the distribution plan or CDSC. To the
extent the unreimbursed receivable has been fully recovered, the distribution
fee is reduced.
7. INDEMNIFICATIONS
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 contracts and expects the
risk of loss to be remote.
8. ACCOUNTING PRONOUNCEMENTS
In July 2006, the Financial Accounting Standards Board (FASB) issued
Interpretation 48, Accounting for Uncertainty in Income Taxes -- an
interpretation of FASB Statement 109 (FIN 48). FIN 48 clarifies the accounting
for income taxes by prescribing the minimum recognition threshold a tax position
must meet before being recognized in the financial statements. FIN 48 is
effective for the fiscal years beginning after December 15, 2006 and is to be
applied to all open tax years as of the effective date. Recent SEC guidance
allows implementing FIN 48 in the fund NAV calculations as late as the fund's
last NAV calculation in the first required financial statement period. As a
result, the Fund will incorporate FIN 48 in its semi annual report on February
29, 2008. The impact to the Fund's financial statements, if any, is currently
being assessed.
In addition, in September 2006, Statement of Financial Accounting Standards
No. 157, Fair Value Measurements (SFAS 157), was issued and is effective for
fiscal years beginning after November 15, 2007. SFAS 157 defines fair value,
establishes a framework for measuring fair value and expands disclosures about
fair value measurements. Management is currently evaluating the impact the
adoption of SFAS 157 will have on the Fund's financial statement disclosures.
9. FUND MERGER
On September 19, 2007, the Trustees of Van Kampen Strategic Growth Fund ("Target
Fund") announced its intention to merge the Target Fund into the Van Kampen Pace
Fund ("Acquiring Fund"). The Trustees of each of the funds have approved in
principal an agreement and plan of reorganization between the funds providing
for a transfer of assets and liabilities of the Target Fund to the Acquiring
Fund in exchange for shares of beneficial interest of the Acquiring Fund (the
"Reorganization"). The Reorganization is subject to the approval by the
shareholders of the Target Fund.
31
VAN KAMPEN STRATEGIC GROWTH FUND
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and Board of Trustees of
Van Kampen Strategic Growth Fund
We have audited the accompanying statement of assets and liabilities,
including the portfolio of investments, of Van Kampen Strategic Growth Fund
(formerly the Van Kampen Emerging Growth Fund) (the "Fund") as of August 31,
2007, and the related statement of operations for the year then ended, the
statements of changes in net assets for each of the two years in the period then
ended, and the financial highlights for each of the five years in the period
then ended. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements and financial highlights are free of material misstatement.
We were not engaged to perform an audit of the Fund's internal control over
financial reporting. Our audits included consideration of internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Fund's internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements and financial highlights, assessing the accounting
principles used and significant estimates made by management, and evaluating the
overall financial statement presentation. Our procedures included confirmation
of securities owned as of August 31, 2007, by correspondence with the custodian
and brokers or by other appropriate auditing procedures where replies from
brokers were not received. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of the
Van Kampen Strategic Growth Fund at August 31, 2007, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended, and the financial highlights for each of
the five years in the period then ended, in conformity with U.S. generally
accepted accounting principles.
/s/ Ernst & Young LLP
Chicago, Illinois
October 16, 2007
32
VAN KAMPEN STRATEGIC GROWTH FUND
BOARD OF TRUSTEES, OFFICERS AND IMPORTANT ADDRESSES
BOARD OF TRUSTEES
DAVID C. ARCH
JERRY D. CHOATE
ROD DAMMEYER
LINDA HUTTON HEAGY
R. CRAIG KENNEDY
HOWARD J KERR
JACK E. NELSON
HUGO F. SONNENSCHEIN
WAYNE W. WHALEN* - Chairman
SUZANNE H. WOOLSEY
OFFICERS
RONALD E. ROBISON
President and Principal Executive Officer
DENNIS SHEA
Vice President
J. DAVID GERMANY
Vice President
AMY R. DOBERMAN
Vice President
STEFANIE V. CHANG
Vice President and Secretary
JOHN L. SULLIVAN
Chief Compliance Officer
STUART N. SCHULDT
Chief Financial Officer and Treasurer
INVESTMENT ADVISER
VAN KAMPEN ASSET MANAGEMENT
522 Fifth Avenue
New York, New York 10036
DISTRIBUTOR
VAN KAMPEN FUNDS INC.
One Parkview Plaza--Suite 100
P.O. Box 5555
Oakbrook Terrace, Illinois 60181-5555
SHAREHOLDER SERVICING AGENT
VAN KAMPEN INVESTOR SERVICES INC.
P.O. Box 947
Jersey City, New Jersey 07303-0947
CUSTODIAN
STATE STREET BANK
AND TRUST COMPANY
One Lincoln Street
Boston, Massachusetts 02111
LEGAL COUNSEL
SKADDEN, ARPS, SLATE,
MEAGHER & FLOM LLP
333 West Wacker Drive
Chicago, Illinois 60606
INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
ERNST & YOUNG LLP
233 South Wacker Drive
Chicago, Illinois 60606
* "Interested persons" of the Fund, as defined in the Investment Company Act
of 1940, as amended.
33
VAN KAMPEN STRATEGIC GROWTH FUND
TRUSTEES AND OFFICERS
The business and affairs of the Fund are managed under the direction of the
Fund's Board of Trustees and the Fund's officers appointed by the Board of
Trustees. The tables below list the trustees and executive officers of the Fund
and their principal occupations during the last five years, other directorships
held by trustees and their affiliations, if any, with Van Kampen Investments,
the Adviser, the Distributor, Van Kampen Advisors Inc., Van Kampen Exchange
Corp. and Investor Services. The term "Fund Complex" includes each of the
investment companies advised by the Adviser as of the date of this Annual
Report. Trustees serve until reaching their retirement age or until their
successors are duly elected and qualified. Officers are annually elected by the
trustees.
INDEPENDENT TRUSTEES
<Table>
<Caption>
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE FUND SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE
David C. Arch (62) Trustee Trustee Chairman and Chief 73 Trustee/Director/Managing
Blistex Inc. since 2003 Executive Officer of General Partner of funds
1800 Swift Drive Blistex Inc., a consumer in the Fund Complex.
Oak Brook, IL 60523 health care products Director of the Heartland
manufacturer. Alliance, a nonprofit
organization serving
human needs based in
Chicago. Board member of
the Illinois
Manufacturers'
Association.
Jerry D. Choate (69) Trustee Trustee Prior to January 1999, 73 Trustee/Director/Managing
33971 Selva Road since 1999 Chairman and Chief General Partner of funds
Suite 130 Executive Officer of the in the Fund Complex.
Dana Point, CA 92629 Allstate Corporation Director of H&R Block,
("Allstate") and Allstate Amgen Inc., a
Insurance Company. Prior biotechnological company,
to January 1995, and Valero Energy
President and Chief Corporation, an
Executive Officer of independent refining
Allstate. Prior to August company.
1994, various management
positions at Allstate.
</Table>
34
<Table>
<Caption>
VAN KAMPEN STRATEGIC GROWTH FUND
TRUSTEES AND OFFICERS continued
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE FUND SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE
Rod Dammeyer (66) Trustee Trustee President of CAC, L.L.C., 73 Trustee/Director/Managing
CAC, L.L.C. since 2003 a private company General Partner of funds
4350 LaJolla Village Drive offering capital in the Fund Complex.
Suite 980 investment and management Director of Quidel
San Diego, CA 92122-6223 advisory services. Corporation, Stericycle,
Inc., Ventana Medical
Systems, Inc. and Trustee
of The Scripps Research
Institute. Prior to April
2007, Director of GATX
Corporation. Prior to
April 2004, Director of
TheraSense, Inc. Prior to
January 2004, Director of
TeleTech Holdings Inc.
and Arris Group, Inc.
Linda Hutton Heagy+ (59) Trustee Trustee Managing Partner of 73 Trustee/Director/Managing
Heidrick & Struggles since 1995 Heidrick & Struggles, an General Partner of funds
233 South Wacker Drive international executive in the Fund Complex.
Suite 7000 search firm. Prior to Trustee on the University
Chicago, IL 60606 1997, Partner of Ray & of Chicago Hospitals
Berndtson, Inc., an Board, Vice Chair of the
executive recruiting Board of the YMCA of
firm. Prior to 1995, Metropolitan Chicago and
Executive Vice President a member of the Women's
of ABN AMRO, N.A., a bank Board of the University
holding company. Prior to of Chicago.
1990, Executive Vice
President of The Exchange
National Bank.
</Table>
35
<Table>
<Caption>
VAN KAMPEN STRATEGIC GROWTH FUND
TRUSTEES AND OFFICERS continued
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE FUND SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE
R. Craig Kennedy (55) Trustee Trustee Director and President of 73 Trustee/Director/Managing
1744 R Street, NW since 1995 the German Marshall Fund General Partner of funds
Washington, DC 20009 of the United States, an in the Fund Complex.
independent U.S.
foundation created to
deepen understanding,
promote collaboration and
stimulate exchanges of
practical experience
between Americans and
Europeans. Formerly,
advisor to the Dennis
Trading Group Inc., a
managed futures and
option company that
invests money for
individuals and
institutions. Prior to
1992, President and Chief
Executive Officer,
Director and member of
the Investment Committee
of the Joyce Foundation,
a private foundation.
Howard J Kerr (71) Trustee Trustee Prior to 1998, President 73 Trustee/Director/Managing
14 Huron Trace since 2003 and Chief Executive General Partner of funds
Galena, IL 61036 Officer of Pocklington in the Fund Complex.
Corporation, Inc., an Director of the Lake
investment holding Forest Bank & Trust.
company. Director of the Marrow
Foundation.
Jack E. Nelson (71) Trustee Trustee President of Nelson 73 Trustee/Director/Managing
423 Country Club Drive since 1995 Investment Planning General Partner of funds
Winter Park, FL 32789 Services, Inc., a in the Fund Complex.
financial planning
company and registered
investment adviser in the
State of Florida.
President of Nelson Ivest
Brokerage Services Inc.,
a member of FINRA,
Securities Investors
Protection Corp. and the
Municipal Securities
Rulemaking Board.
President of Nelson Sales
and Services Corporation,
a marketing and services
company to support
affiliated companies.
</Table>
36
<Table>
<Caption>
VAN KAMPEN STRATEGIC GROWTH FUND
TRUSTEES AND OFFICERS continued
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE FUND SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE
Hugo F. Sonnenschein (66) Trustee Trustee President Emeritus and 73 Trustee/Director/Managing
1126 E. 59th Street since 2003 Honorary Trustee of the General Partner of funds
Chicago, IL 60637 University of Chicago and in the Fund Complex.
the Adam Smith Trustee of the University
Distinguished Service of Rochester and a member
Professor in the of its investment
Department of Economics committee. Member of the
at the University of National Academy of
Chicago. Prior to July Sciences, the American
2000, President of the Philosophical Society and
University of Chicago. a fellow of the American
Academy of Arts and
Sciences.
</Table>
37
<Table>
<Caption>
VAN KAMPEN STRATEGIC GROWTH FUND
TRUSTEES AND OFFICERS continued
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE FUND SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE
Suzanne H. Woolsey, Ph.D. Trustee Trustee Chief Communications 73 Trustee/Director/Managing
(65) since 1999 Officer of the National General Partner of funds
815 Cumberstone Road Academy of in the Fund Complex.
Harwood, MD 20776 Sciences/National Director of Fluor Corp.,
Research Council, an an engineering,
independent, federally procurement and
chartered policy construction
institution, from 2001 to organization, since
November 2003 and Chief January 2004. Director of
Operating Officer from Intelligent Medical
1993 to 2001. Prior to Devices, Inc., a symptom
1993, Executive Director based diagnostic tool for
of the Commission on physicians and clinical
Behavioral and Social labs. Director of the
Sciences and Education at Institute for Defense
the National Academy of Analyses, a federally
Sciences/National funded research and
Research Council. From development center,
1980 through 1989, Director of the German
Partner of Coopers & Marshall Fund of the
Lybrand. United States, Director
of the Rocky Mountain
Institute of Technology
and the Colorado College.
</Table>
38
VAN KAMPEN STRATEGIC GROWTH FUND
TRUSTEES AND OFFICERS continued
INTERESTED TRUSTEE*
<Table>
<Caption>
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS
OF INTERESTED TRUSTEE FUND SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE
Wayne W. Whalen* (68) Trustee Trustee Partner in the law firm 73 Trustee/Director/Managing
333 West Wacker Drive since 1995 of Skadden, Arps, Slate, General Partner of funds
Chicago, IL 60606 Meagher & Flom LLP, legal in the Fund Complex.
counsel to funds in the Director of the Abraham
Fund Complex. Lincoln Presidential
Library Foundation.
</Table>
+ As indicated above, Ms. Heagy is an employee of Heidrick and Struggles, an
international executive search firm ("Heidrick"). Heidrick has been (and may
continue to be) engaged by Morgan Stanley from time to time to perform
executive searches. Such searches have been unrelated to Van Kampen's or
Morgan Stanley's asset management businesses and have been done by
professionals at Heidrick without any involvement by Ms. Heagy. Ethical wall
procedures exist to ensure that Ms. Heagy will not have any involvement with
any searches performed by Heidrick for Morgan Stanley. Ms. Heagy does not
receive any compensation, directly or indirectly, for searches performed by
Heidrick for Morgan Stanley. Ms. Heagy does own common shares of Heidrick
(representing less than 1% of Heidrick's outstanding common shares).
* Mr. Whalen is an "interested person" (within the meaning of Section 2(a)(19)
of the 1940 Act) of certain funds in the Fund Complex by reason of he and
his firm currently providing legal services as legal counsel to such funds
in the Fund Complex.
39
VAN KAMPEN STRATEGIC GROWTH FUND
TRUSTEES AND OFFICERS continued
OFFICERS
<Table>
<Caption>
TERM OF
OFFICE AND
POSITION(S) LENGTH OF
NAME, AGE AND HELD WITH TIME PRINCIPAL OCCUPATION(S)
ADDRESS OF OFFICER FUND SERVED DURING PAST 5 YEARS
Ronald E. Robison (68) President and Officer President of funds in the Fund Complex since September 2005
522 Fifth Avenue Principal Executive since 2003 and Principal Executive Officer of funds in the Fund Complex
New York, NY 10036 Officer since May 2003. Managing Director of Van Kampen Advisors
Inc. since June 2003. Director of Investor Services since
September 2002. Director of the Adviser, Van Kampen
Investments and Van Kampen Exchange Corp. since January
2005. Managing Director of Morgan Stanley and Morgan Stanley
& Co. Incorporated. Managing Director and Director of Morgan
Stanley Investment Management Inc. Chief Administrative
Officer, Managing Director and Director of Morgan Stanley
Investment Advisors Inc. and Morgan Stanley Services Company
Inc. Managing Director and Director of Morgan Stanley
Distributors Inc. and Morgan Stanley Distribution Inc. Chief
Executive Officer and Director of Morgan Stanley Trust.
Executive Vice President and Principal Executive Officer of
the Institutional and Retail Morgan Stanley Funds. Director
of Morgan Stanley SICAV. Previously, Chief Global Operations
Officer of Morgan Stanley Investment Management Inc. and
Executive Vice President of funds in the Fund Complex from
May 2003 to September 2005.
Dennis Shea (54) Vice President Officer Managing Director of Morgan Stanley Investment Advisors
522 Fifth Avenue since 2006 Inc., Morgan Stanley Investment Management Inc., the Adviser
New York, NY 10036 and Van Kampen Advisors Inc. Chief Investment Officer--
Global Equity of the same entities since February 2006. Vice
President of Morgan Stanley Institutional and Retail Funds
since February 2006. Vice President of funds in the Fund
Complex since March 2006. Previously, Managing Director and
Director of Global Equity Research at Morgan Stanley from
April 2000 to February 2006.
J. David Germany (53) Vice President Officer Managing Director of Morgan Stanley Investment Advisors
20 Bank Street, since 2006 Inc., Morgan Stanley Investment Management Inc., the Adviser
Canary Wharf and Van Kampen Advisors Inc. Chief Investment Officer--
London, GBR E14 4AD Global Fixed Income of the same entities since December
2005. Managing Director and Director of Morgan Stanley
Investment Management Ltd. Director of Morgan Stanley
Investment Management (ACD) Limited since December 2003.
Vice President of Morgan Stanley Institutional and Retail
Funds since February 2006. Vice President of funds in the
Fund Complex since March 2006.
</Table>
40
<Table>
<Caption>
VAN KAMPEN STRATEGIC GROWTH FUND
TRUSTEES AND OFFICERS continued
TERM OF
OFFICE AND
POSITION(S) LENGTH OF
NAME, AGE AND HELD WITH TIME PRINCIPAL OCCUPATION(S)
ADDRESS OF OFFICER FUND SERVED DURING PAST 5 YEARS
Amy R. Doberman (45) Vice President Officer Managing Director and General Counsel--U.S. Investment
522 Fifth Avenue since 2004 Management; Managing Director of Morgan Stanley Investment
New York, NY 10036 Management Inc., Morgan Stanley Investment Advisors Inc. and
the Adviser. Vice President of the Morgan Stanley
Institutional and Retail Funds since July 2004 and Vice
President of funds in the Fund Complex since August 2004.
Previously, Managing Director and General Counsel of
Americas, UBS Global Asset Management from July 2000 to July
2004 and General Counsel of Aeltus Investment Management,
Inc. from January 1997 to July 2000.
Stefanie V. Chang (40) Vice President Officer Executive Director of Morgan Stanley Investment Management
522 Fifth Avenue and Secretary since 2003 Inc. Vice President and Secretary of funds in the Fund
New York, NY 10036 Complex.
John L. Sullivan (52) Chief Compliance Officer Chief Compliance Officer of funds in the Fund Complex since
1 Parkview Plaza - Suite 100 Officer since 1996 August 2004. Prior to August 2004, Director and Managing
Oakbrook Terrace, IL 60181 Director of Van Kampen Investments, the Adviser, Van Kampen
Advisors Inc. and certain other subsidiaries of Van Kampen
Investments, Vice President, Chief Financial Officer and
Treasurer of funds in the Fund Complex and head of Fund
Accounting for Morgan Stanley Investment Management Inc.
Prior to December 2002, Executive Director of Van Kampen
Investments, the Adviser and Van Kampen Advisors Inc.
Stuart N. Schuldt (45) Chief Financial Officer Officer Executive Director of Morgan Stanley Investment Management
1 Parkview Plaza - Suite 100 and Treasurer since 2007 Inc. since June 2007. Chief Financial Officer and Treasurer
Oakbrook Terrace, IL 60181 of funds in the Fund Complex since June 2007. Prior to June
2007, Senior Vice President of Northern Trust Company,
Treasurer and Principal Financial Officer for Northern Trust
U.S. mutual fund complex.
</Table>
41
Van Kampen Strategic Growth Fund
An Important Notice Concerning Our U.S. Privacy Policy
We are required by federal law to provide you with a copy of our Privacy
Policy annually.
The following Policy applies to current and former individual clients of Van
Kampen Investments Inc., Van Kampen Asset Management, Van Kampen Advisors
Inc., Van Kampen Funds Inc., Van Kampen Investor Services Inc. and Van
Kampen Exchange Corp., as well as current and former individual investors in
Van Kampen mutual funds, unit investment trusts, and related companies.
This Policy is not applicable to partnerships, corporations, trusts or other
non-individual clients or account holders, nor is this Policy applicable to
individuals who are either beneficiaries of a trust for which we serve as
trustee or participants in an employee benefit plan administered or advised
by us. This Policy is, however, applicable to individuals who select us to
be a custodian of securities or assets in individual retirement accounts,
401(k) accounts, 529 Educational Savings Accounts, accounts subject to the
Uniform Gifts to Minors Act, or similar accounts.
Please note that we may amend this Policy at any time, and will inform you
of any changes to this Policy as required by law.
WE RESPECT YOUR PRIVACY
We appreciate that you have provided us with your personal financial
information. We strive to maintain the privacy of such information while we
help you achieve your financial objectives. This Policy describes what
non-public personal information we collect about you, why we collect it, and
when we may share it with others.
We hope this Policy will help you understand how we collect and share
non-public personal information that we gather about you. Throughout this
Policy, we refer to the non-public information that personally identifies
you or your accounts as "personal information."
1. WHAT PERSONAL INFORMATION DO WE COLLECT ABOUT YOU?
To serve you better and manage our business, it is important that we collect
and maintain accurate information about you. We may obtain this information
from applications and other forms you submit to us, from your dealings with
us, from consumer reporting agencies, from our Web sites and from third
parties and other sources.
(continued on next page)
Van Kampen Strategic Growth Fund
An Important Notice Concerning Our U.S. Privacy Policy continued
For example:
-- We may collect information such as your name, address, e-mail address,
telephone/fax numbers, assets, income and investment objectives through
applications and other forms you submit to us.
-- We may obtain information about account balances, your use of
account(s) and the types of products and services you prefer to receive
from us through your dealings and transactions with us and other
sources.
-- We may obtain information about your creditworthiness and credit
history from consumer reporting agencies.
-- We may collect background information from and through third-party
vendors to verify representations you have made and to comply with
various regulatory requirements.
-- If you interact with us through our public and private Web sites, we
may collect information that you provide directly through online
communications (such as an e-mail address). We may also collect
information about your Internet service provider, your domain name,
your computer's operating system and Web browser, your use of our Web
sites and your product and service preferences, through the use of
"cookies." "Cookies" recognize your computer each time you return to
one of our sites, and help to improve our sites' content and
personalize your experience on our sites by, for example, suggesting
offerings that may interest you. Please consult the Terms of Use of
these sites for more details on our use of cookies.
2. WHEN DO WE DISCLOSE PERSONAL INFORMATION WE COLLECT ABOUT YOU?
To provide you with the products and services you request, to serve you
better and to manage our business, we may disclose personal information we
collect about you to our affiliated companies and to non-affiliated third
parties as required or permitted by law.
A. INFORMATION WE DISCLOSE TO OUR AFFILIATED COMPANIES. We do not disclose
personal information that we collect about you to our affiliated companies
except to enable them to provide services on our behalf or as otherwise
required or permitted by law.
B. INFORMATION WE DISCLOSE TO THIRD PARTIES. We do not disclose personal
information that we collect about you to non-affiliated third parties except
to enable them to provide services on our behalf, to perform joint marketing
agreements with
(continued on back)
Van Kampen Strategic Growth Fund
An Important Notice Concerning Our U.S. Privacy Policy continued
other financial institutions, or as otherwise required or permitted by law.
For example, some instances where we may disclose information about you to
non-affiliated third parties include: for servicing and processing
transactions, to offer our own products and services, to protect against
fraud, for institutional risk control, to respond to judicial process or to
perform services on our behalf. When we share personal information with
these companies, they are required to limit their use of personal
information to the particular purpose for which it was shared and they are
not allowed to share personal information with others except to fulfill that
limited purpose.
3. HOW DO WE PROTECT THE SECURITY AND CONFIDENTIALITY OF PERSONAL
INFORMATION WE COLLECT ABOUT YOU?
We maintain physical, electronic and procedural security measures to help
safeguard the personal information we collect about you. We have internal
policies governing the proper handling of client information. Third parties
that provide support or marketing services on our behalf may also receive
personal information, and we require them to adhere to confidentiality
standards with respect to such information.
The Statement of Additional Information includes additional information
about Fund trustees and is available, without charge, upon request by
calling 1-800-847-2424.
Van Kampen Funds Inc.
1 Parkview Plaza - Suite 100
P.O. Box 5555
Oakbrook Terrace, IL 60181-5555
www.vankampen.com
Copyright (C)2007 Van Kampen Funds Inc.
All rights reserved. Member FINRA/SIPC.
16, 116, 216, 516, 316
EMGANN 10/07
(VAN KAMPEN INVESTMENTS LOGO) IU07-03925P-Y08/07
Item 2. Code of Ethics.
(a) The Fund has adopted a code of ethics (the "Code of Ethics") that applies to
its principal executive officer, principal financial officer, principal
accounting officer or controller, or persons performing similar functions,
regardless of whether these individuals are employed by the Fund or a third
party.
(b) No information need be disclosed pursuant to this paragraph.
(c) Due to personnel changes at the Adviser, the list of covered officers set
forth in Exhibit B was amended in November 2006 and June 2007 and the
general counsel's designee set forth in Exhibit C was amended in October
and December 2006. All three editions of Exhibit B and all three editions
of Exhibit C are attached.
(d) Not applicable.
(e) Not applicable.
(f)
(1) The Fund's Code of Ethics is attached hereto as Exhibit 12(1).
(2) Not applicable.
(3) Not applicable.
Item 3. Audit Committee Financial Expert.
The Fund's Board of Trustees has determined that it has three "audit committee
financial experts" serving on its audit committee, each of whom are
"independent" Trustees : Rod Dammeyer, Jerry D. Choate and R. Craig Kennedy.
Under applicable securities laws, a person who is determined to be an audit
committee financial expert will not be deemed an "expert" for any purpose,
including without limitation for the purposes of Section 11 of the Securities
Act of 1933, as a result of being designated or identified as an audit committee
financial expert. The designation or identification of a person as an audit
committee financial expert does not impose on such person any duties,
obligations, or liabilities that are greater than the duties, obligations, and
liabilities imposed on such person as a member of the audit committee and Board
of Trustees in the absence of such designation or identification.
Item 4. Principal Accountant Fees and Services.
(a)(b)(c)(d) and (g). Based on fees billed for the periods shown:
2007
REGISTRANT COVERED ENTITIES(1)
---------- -------------------
AUDIT FEES.............. $71,100 N/A
NON-AUDIT FEES
AUDIT-RELATED FEES... $ 0 $ 781,800(2)
TAX FEES............. $ 2,575(3) $ 63,070(4)
ALL OTHER FEES....... $ 0 $ 157,910(5)
TOTAL NON-AUDIT FEES.... $ 2,575 $1,002,780
TOTAL................... $73,675 $1,002,780
2006
REGISTRANT COVERED ENTITIES(1)
---------- -------------------
AUDIT FEES.............. $69,000 N/A
NON-AUDIT FEES
AUDIT-RELATED FEES... $ 0 $ 706,000(2)
TAX FEES............. $ 2,300(3) $ 75,537(4)
ALL OTHER FEES....... $ 0 $ 749,041(5)
TOTAL NON-AUDIT FEES.... $ 2,300 $1,530,578
TOTAL................... $71,300 $1,530,578
N/A- Not applicable, as not required by Item 4.
(1) Covered Entities include the Adviser (excluding sub-advisors) and any
entity controlling, controlled by or under common control with the Adviser
that provides ongoing services to the Registrant.
(2) Audit-Related Fees represent assurance and related services provided that
are reasonably related to the performance of the audit of the financial
statements of the Covered Entities' and funds advised by the Adviser or its
affiliates, specifically attestation services provided in connection with a
SAS 70 Report.
(3) Tax Fees represent tax advice and compliance services provided in
connection with the review of the Registrant's tax.
(4) Tax Fees represent tax advice services provided to Covered Entities,
including research and identification of PFIC entities.
(5) All Other Fees represent attestation services provided in connection with
performance presentation standards and assistance with compliance policies
and procedures.
(e)(1) The audit committee's pre-approval policies and procedures are as
follows:
JOINT AUDIT COMMITTEE
AUDIT AND NON-AUDIT SERVICES
PRE-APPROVAL POLICY AND PROCEDURES
OF THE
VAN KAMPEN FUNDS
AS ADOPTED JULY 23, 2003 AND AMENDED MAY 26, 2004(1)
1. STATEMENT OF PRINCIPLES
The Audit Committee of the Board is required to review and, in its sole
discretion, pre-approve all Covered Services to be provided by the Independent
Auditors to the Fund and Covered Entities in order to assure that services
performed by the Independent Auditors do not impair the auditor's independence
from the Fund.(2)
The SEC has issued rules specifying the types of services that an
independent auditor may not provide to its audit client, as well as the audit
committee's administration of the engagement of the independent auditor. The
SEC's rules establish two different approaches to pre-approving services, which
the SEC considers to be equally valid. Proposed services either: may be
pre-approved without consideration of specific case-by-case services by the
Audit Committee ("general pre-approval"); or require the specific pre-approval
of the Audit Committee ("specific pre-approval"). The Audit Committee believes
that the combination of these two approaches in this Policy will result in an
effective and efficient procedure to pre-approve services performed by the
Independent Auditors. As set forth in this Policy, unless a type of service has
received general pre-approval, it will require specific pre-approval by the
Audit Committee (or by any member of the Audit Committee to which pre-approval
authority has been delegated) if it is to be provided by the Independent
Auditors. Any proposed services exceeding pre-approved cost levels or budgeted
amounts will also require specific pre-approval by the Audit Committee.
For both types of pre-approval, the Audit Committee will consider whether
such services are consistent with the SEC's rules on auditor independence. The
Audit Committee will also consider whether the Independent Auditors are best
positioned to provide the most effective and efficient services, for reasons
such as its familiarity with the Fund's business, people, culture, accounting
systems, risk profile and other factors, and whether the service might enhance
the Fund's ability to manage or control risk or improve audit quality. All such
factors will be considered as a whole, and no one factor should necessarily be
determinative.
The Audit Committee is also mindful of the relationship between fees for
audit and non-audit services in deciding whether to pre-approve any such
services and may determine for each fiscal year, the appropriate ratio between
the total amount of fees for Audit, Audit-related and Tax services for the Fund
(including any Audit-related or Tax service fees for Covered Entities that were
subject to pre-approval), and the total amount of fees for certain permissible
non-audit services classified as All Other services for the Fund (including any
such services for Covered Entities subject to pre-approval).
The appendices to this Policy describe the Audit, Audit-related, Tax and
All Other services that have the general pre-approval of the Audit Committee.
The term of any general pre-approval is 12 months from the date of pre-approval,
unless the Audit Committee considers and provides a different period and states
otherwise. The Audit Committee will annually review and pre-approve the services
that may be provided by the Independent Auditors without obtaining specific
pre-approval from the Audit Committee. The Audit Committee will add to or
subtract from the list of general pre-approved services from time to time, based
on subsequent determinations.
The purpose of this Policy is to set forth the policy and procedures by
which the Audit Committee intends to fulfill its responsibilities. It does not
delegate the Audit Committee's responsibilities to pre-approve services
performed by the Independent Auditors to management.
- ----------
(1) This Joint Audit Committee Audit and Non-Audit Services Pre-Approval Policy
and Procedures (the "Policy"), amended as of the date above, supercedes and
replaces all prior versions that may have been amended from time to time.
(2) Terms used in this Policy and not otherwise defined herein shall have the
meanings as defined in the Joint Audit Committee Charter.
The Fund's Independent Auditors have reviewed this Policy and believes that
implementation of the Policy will not adversely affect the Independent Auditors'
independence.
2. DELEGATION
As provided in the Act and the SEC's rules, the Audit Committee may
delegate either type of pre-approval authority to one or more of its members.
The member to whom such authority is delegated must report, for informational
purposes only, any pre-approval decisions to the Audit Committee at its next
scheduled meeting.
3. AUDIT SERVICES
The annual Audit services engagement terms and fees are subject to the
specific pre-approval of the Audit Committee. Audit services include the annual
financial statement audit and other procedures required to be performed by the
Independent Auditors to be able to form an opinion on the Fund's financial
statements. These other procedures include information systems and procedural
reviews and testing performed in order to understand and place reliance on the
systems of internal control, and consultations relating to the audit. The Audit
Committee will monitor the Audit services engagement as necessary, but no less
than on a quarterly basis, and will also approve, if necessary, any changes in
terms, conditions and fees resulting from changes in audit scope, Fund structure
or other items.
In addition to the annual Audit services engagement approved by the Audit
Committee, the Audit Committee may grant general pre-approval to other Audit
services, which are those services that only the Independent Auditors reasonably
can provide. Other Audit services may include statutory audits and services
associated with SEC registration statements (on Forms N-1A, N-2, N-3, N-4,
etc.), periodic reports and other documents filed with the SEC or other
documents issued in connection with securities offerings.
The Audit Committee has pre-approved the Audit services in Appendix B.1.
All other Audit services not listed in Appendix B.1 must be specifically
pre-approved by the Audit Committee (or by any member of the Audit Committee to
which pre-approval has been delegated).
4. AUDIT-RELATED SERVICES
Audit-related services are assurance and related services that are
reasonably related to the performance of the audit or review of the Fund's
financial statements or, to the extent they are Covered Services, the Covered
Entities' financial statements, or that are traditionally performed by the
Independent Auditors. Because the Audit Committee believes that the provision of
Audit-related services does not impair the independence of the auditor and is
consistent with the SEC's rules on auditor independence, the Audit Committee may
grant general pre-approval to Audit-related services. Audit-related services
include, among others, accounting consultations related to accounting, financial
reporting or disclosure matters not classified as "Audit services"; assistance
with understanding and implementing new accounting and financial reporting
guidance from rulemaking authorities; agreed-upon or expanded audit procedures
related to accounting and/or billing records required to respond to or comply
with financial, accounting or regulatory reporting matters; and assistance with
internal control reporting requirements under Forms N-SAR and/or N-CSR.
The Audit Committee has pre-approved the Audit-related services in Appendix
B.2. All other Audit-related services not listed in Appendix B.2 must be
specifically pre-approved by the Audit Committee (or by any member of the Audit
Committee to which pre-approval has been delegated).
5. TAX SERVICES
The Audit Committee believes that the Independent Auditors can provide Tax
services to the Fund and, to the extent they are Covered Services, the Covered
Entities, such as tax compliance, tax planning and tax advice without impairing
the auditor's independence, and the SEC has stated that the Independent Auditors
may provide such services. Hence, the Audit Committee believes it may grant
general pre-approval to those Tax services that have historically been provided
by the Independent Auditors, that the Audit Committee has reviewed and believes
would not impair the independence of the Independent Auditors, and that are
consistent with the SEC's rules on auditor independence. The Audit Committee
will not permit the retention of the
Independent Auditors in connection with a transaction initially recommended by
the Independent Auditors, the sole business purpose of which may be tax
avoidance and the tax treatment of which may not be supported in the Internal
Revenue Code and related regulations. The Audit Committee will consult with
Director of Tax or outside counsel to determine that the tax planning and
reporting positions are consistent with this policy.
Pursuant to the preceding paragraph, the Audit Committee has pre-approved
the Tax Services in Appendix B.3. All Tax services involving large and complex
transactions not listed in Appendix B.3 must be specifically pre-approved by the
Audit Committee (or by any member of the Audit Committee to which pre-approval
has been delegated), including tax services proposed to be provided by the
Independent Auditors to any executive officer or trustee/director/managing
general partner of the Fund, in his or her individual capacity, where such
services are paid for by the Fund (generally applicable only to internally
managed investment companies).
6. ALL OTHER SERVICES
The Audit Committee believes, based on the SEC's rules prohibiting the
Independent Auditors from providing specific non-audit services, that other
types of non-audit services are permitted. Accordingly, the Audit Committee
believes it may grant general pre-approval to those permissible non-audit
services classified as All Other services that it believes are routine and
recurring services, would not impair the independence of the auditor and are
consistent with the SEC's rules on auditor independence.
The Audit Committee has pre-approved the All Other services in Appendix
B.4. Permissible All Other services not listed in Appendix B.4 must be
specifically pre-approved by the Audit Committee (or by any member of the Audit
Committee to which pre-approval has been delegated).
A list of the SEC's prohibited non-audit services is attached to this
policy as Appendix B.5. The SEC's rules and relevant guidance should be
consulted to determine the precise definitions of these services and the
applicability of exceptions to certain of the prohibitions.
7. PRE-APPROVAL FEE LEVELS OR BUDGETED AMOUNTS
Pre-approval fee levels or budgeted amounts for all services to be provided
by the Independent Auditors will be established annually by the Audit Committee.
Any proposed services exceeding these levels or amounts will require specific
pre-approval by the Audit Committee. The Audit Committee is mindful of the
overall relationship of fees for audit and non-audit services in determining
whether to pre-approve any such services. For each fiscal year, the Audit
Committee may determine the appropriate ratio between the total amount of fees
for Audit, Audit-related, and Tax services for the Fund (including any
Audit-related or Tax services fees for Covered Entities subject to
pre-approval), and the total amount of fees for certain permissible non-audit
services classified as All Other services for the Fund (including any such
services for Covered Entities subject to pre-approval).
8. PROCEDURES
All requests or applications for services to be provided by the Independent
Auditors that do not require specific approval by the Audit Committee will be
submitted to the Fund's Chief Financial Officer and must include a detailed
description of the services to be rendered. The Fund's Chief Financial Officer
will determine whether such services are included within the list of services
that have received the general pre-approval of the Audit Committee. The Audit
Committee will be informed on a timely basis of any such services rendered by
the Independent Auditors. Requests or applications to provide services that
require specific approval by the Audit Committee will be submitted to the Audit
Committee by both the Independent Auditors and the Fund's Chief Financial
Officer, and must include a joint statement as to whether, in their view, the
request or application is consistent with the SEC's rules on auditor
independence.
The Audit Committee has designated the Fund's Chief Financial Officer to
monitor the performance of all services provided by the Independent Auditors and
to determine whether such services are in compliance with this Policy. The
Fund's Chief Financial Officer will report to the Audit Committee on a periodic
basis on the results of its monitoring. A sample report is included as Appendix
B.7. Both the Fund's Chief Financial Officer and management will immediately
report to the chairman of the Audit Committee any breach of this Policy that
comes to the attention of the Fund's Chief Financial Officer or any member of
management.
9. ADDITIONAL REQUIREMENTS
The Audit Committee has determined to take additional measures on an annual
basis to meet its responsibility to oversee the work of the Independent Auditors
and to assure the auditor's independence from the Fund, such as reviewing a
formal written statement from the Independent Auditors delineating all
relationships between the Independent Auditors and the Fund, consistent with
Independence Standards Board No. 1, and discussing with the Independent Auditors
its methods and procedures for ensuring independence.
10. COVERED ENTITIES
Covered Entities include the Fund's investment adviser(s) and any entity
controlling, controlled by or under common control with the Fund's investment
adviser(s) that provides ongoing services to the Fund(s). Beginning with
non-audit service contracts entered into on or after May 6, 2003, the Fund's
audit committee must pre-approve non-audit services provided not only to the
Fund but also to the Covered Entities if the engagements relate directly to the
operations and financial reporting of the Fund. This list of Covered Entities
would include:
- Van Kampen Investments Inc.
- Van Kampen Asset Management
- Van Kampen Advisors Inc.
- Van Kampen Funds Inc.
- Van Kampen Investor Services Inc.
- Morgan Stanley Investment Management Inc.
- Morgan Stanley Trust Company
- Morgan Stanley Investment Management Ltd.
- Morgan Stanley Investment Management Company
- Morgan Stanley Asset & Investment Trust Management Company Ltd.
(e)(2) Beginning with non-audit service contracts entered into on or after May
6, 2003, the audit committee also is required to pre-approve services to Covered
Entities to the extent that the services are determined to have a direct impact
on the operations or financial reporting of the Registrant. 100% of such
services were pre-approved by the audit committee pursuant to the Audit
Committee's pre-approval policies and procedures (included herein).
(f) Not applicable.
(g) See table above.
(h) The audit committee of the Board of Trustees has considered whether the
provision of services other than audit services performed by the auditors to the
Registrant and Covered Entities is compatible with maintaining the auditors'
independence in performing audit services.
Item 5. Audit Committee of Listed Registrants.
(a) The Fund has a separately-designated standing audit committee established in
accordance with Section 3(a)(58)(A) of the Exchange Act whose members are: R.
Craig Kennedy, Jerry D. Choate, Rod Dammeyer.
(b) Not applicable.
Item 6. Schedule of Investments.
Please refer to Item #1.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies.
Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable.
Item 9. Purchases of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchasers.
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
Not applicable.
Item 11. Controls and Procedures.
(a) The Fund's principal executive officer and principal financial officer have
concluded that the Fund's disclosure controls and procedures are sufficient to
ensure that information required to be disclosed by the Fund in this Form N-CSR
was recorded, processed, summarized and reported within the time periods
specified in the Securities and Exchange Commission's rules and forms, based
upon such officers' evaluation of these controls and procedures as of a date
within 90 days of the filing date of the report.
(b) There were no changes in the registrant's internal control over financial
reporting that occurred during the second fiscal quarter of the period covered
by this report that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting.
Item 12. Exhibits.
(1) The Code of Ethics for Principal Executive and Senior Financial Officers is
attached hereto.
(2)(a) A certification for the Principal Executive Officer of the registrant is
attached hereto as part of EX-99.CERT.
(2)(b) A certification for the Principal Financial Officer of the registrant is
attached hereto as part of EX-99.CERT.
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) Van Kampen Strategic Growth Fund
By: /s/ Ronald E. Robison
------------------------------
Name: Ronald E. Robison
Title: Principal Executive Officer
Date: October 18, 2007
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed by the following
persons on behalf of the registrant and in the capacities and on the dates
indicated.
By: /s/ Ronald E. Robison
-----------------------------
Name: Ronald E. Robison
Title: Principal Executive Officer
Date: October 18, 2007
By: /s/ Stuart N. Schuldt
------------------------------
Name: Stuart N. Schuldt
Title: Principal Financial Officer
Date: October 18, 2007