nvcsr

N-CSR 1 c02124nvcsr.htm CERTIFIED SHAREHOLDER REPORT nvcsr

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 811-07655

Driehaus Mutual Funds

(Exact name of registrant as specified in charter)

25 East Erie Street
Chicago, IL 60611

(Address of principal executive offices) (Zip code)

Mary H. Weiss
25 East Erie Street
Chicago, IL 60611

(Name and address of agent for service)

Registrant’s telephone number, including area code:312-587-3800

Date of fiscal year end: December 31

Date of reporting period: December 31, 2005

Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.

A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget (“OMB”) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 100 F Street, NE, Washington, DC 20549. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.

TABLE OF CONTENTS


	Item 1. Reports to Stockholders
	Item 2. Code of Ethics.
	Item 3. Audit Committee Financial Expert.
	Item 4. Principal Accountant Fees and Services.
	Item 5. Audit Committee of Listed Registrants.
	Item 6. Schedule of Investments.
	Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
	Item 8. Portfolio Managers of Closed-End Management Investment Companies.
	Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
	Item 10. Submission of Matters to a Vote of Security Holders.
	Item 11. Controls and Procedures.
	Item 12. Exhibits.
SIGNATURES
Certification
Certification

Item 1. Reports to Stockholders.

The Report to Shareholders is attached herewith.


Driehaus Mutual Funds Trustees & Officers Richard H. Driehaus President A.R. Umans Chairman of the Board Francis J. Harmon Trustee Daniel F. Zemanek Trustee John E. Angley Vice President Michelle L. Cahoon Treasurer Joseph D. McDermott Chief Compliance Officer Tina M. Payne Secretary Kelly C. Dehler Assistant Secretary Candace A. Croal Assistant Secretary Investment Adviser Driehaus Capital Management LLC 25 East Erie Street Chicago, IL 60611 Distributor Driehaus Securities LLC 25 East Erie Street Chicago, IL 60611 Administrator PFPC Inc. 4400 Computer Drive Westborough, MA 01581 Transfer Agent PFPC Inc. 101 Sabin Street Pawtucket, RI 02862 Custodian JPMorgan Chase Bank, N.A. 3 Chase MetroTech Center Brooklyn, NY 11245		Annual Report to Shareholders December 31, 2005 Driehaus International Discovery Fund Driehaus Emerging Markets Growth Fund Distributed by: Driehaus Securities LLC This report has been prepared for the shareholders of the Funds and is not an offering to sell or buy any Fund securities. Such offering is only made by the Funds’ prospectus.

Table of Contents


Driehaus International Discovery Fund
	Portfolio Manager’s Letter	1
	Performance Overview	4
	Schedule of Investments	5

Driehaus Emerging Markets Growth Fund
	Portfolio Manager’s Letter	12
	Performance Overview	14
	Schedule of Investments	15

Each Fund section includes:
	Statement of Assets and Liabilities
	Statement of Operations
	Statement of Changes in Net Assets
	Financial Highlights

Notes to Financial Statements		23

Report of Independent Registered Public Accounting Firm		29

Interested and Independent Trustees of the Trust		30

Officers of the Trust		31

Fund Expense Examples		32

Shareholder Information		33

Board Considerations in Connection with the Annual Review of the Investment Advisory Agreement		34

Annual Report to Shareholders

December 31, 2005

Investment Philosophy:

The Adviser seeks to achieve superior investment returns primarily by investing in companies outside the U.S. that are currently demonstrating rapid growth in their sales and earnings and which, in our judgement, have the ability to continue or accelerate their growth rates in the future. The Adviser manages the portfolios actively (above average turnover) to insure that the Funds are fully invested, under appropriate market conditions, in companies that meet these criteria. Investors should note that investments in overseas markets can pose more risks than U.S. investments, and the Funds’ share prices are expected to be more volatile than those of U.S.-only funds. In addition, the Funds’ returns will fluctuate with changes in stock market conditions, currency values, interest rates, foreign government regulations, and economic and political conditions in countries in which the Funds invest. These risks are generally greater when investing in emerging markets.

Driehaus International Discovery Fund

Driehaus Emerging Markets Growth Fund

Driehaus International Discovery Fund — Portfolio Manager’s Letter

Dear Fellow Shareholders,

The Driehaus International Discovery Fund was up 43.97% for the year ended December 31, 2005. This performance significantly exceeded the performance of the fund’s two major benchmark indices: the Morgan Stanley Capital International (MSCI) Europe, Australasia and Far East (EAFE^®) Growth Index (which gained 13.28% for the year) and the MSCI All Country (AC) World ex USA Index (which gained 17.11%).

The fund has also outpaced these indices over longer periods. For the three years ended December 31, 2005, the average annualized return for the Driehaus International Discovery Fund was 37.81%, which compares favorably with the MSCI EAFE^® Growth Index return of 20.19% and the MSCI AC World ex USA Index return of 26.20%. Over the past five years, the fund returned 14.32% on an average annualized basis (versus the MSCI EAFE^® Growth Index return of 1.92% and the MSCI AC World ex USA Index return of 6.66%). Since inception of the fund (December 31, 1998), the average annualized return is 27.35%, which exceeds the returns on both the MSCI EAFE^® Growth Index (at 1.03%) and the MSCI AC World ex USA Index (at 6.31%) by a considerable margin.¹

The positive results for 2005 were consistent throughout the year, as the fund outperformed the relevant indices each quarter. A highlight of the year’s performance was the especially strong fourth quarter; the fund outperformed each index by over 1,000 basis points.

One of the key macroeconomic factors that contributed to the fund’s strong performance during the year was the strength of the dollar versus the euro and yen, as well as optimism in overseas markets reacting to the strength of the U.S. economy. In addition to the strong performance experienced in 2005, the assets under management in the fund also increased, from $345 million at year-end 2004 to $603 million at the end of 2005.

Investments in more smaller cap companies (versus 2004) benefited performance. In terms of overall contribution to return, over half of the year’s performance was attributable to smaller capitalization companies (with less than $1.0 billion U.S. Dollar market capitalization). The weighted median market capitalization of the fund was $3.3 billion at the end of 2004, and had fallen to $2.1 billion as of year-end 2005. Smaller cap international companies performed better on a relative basis than larger cap companies during 2005.

The fund’s allocation to Japan was a key component of the year’s strong results. The Japanese stock market was robust for much of the year, and despite sometimes lackluster Japanese economic data, the country’s economy was in recovery. The fund was slightly overweighted in Japanese stocks in general, and benefited from strong stock selection in particular. One of the fund’s best performing holdings was Ibiden Company Limited (4062 JP), a maker of ceramics, housing materials and electronics. One of their specialty ceramic product lines, diesel particulate filters (DPFs) for automotive applications, has expanded rapidly, and this growth is expected to continue. In addition, the company has also experienced strong demand for three of its electronics product lines: printed circuit boards (PCBs), integrated circuit (IC) packages and flip-chip (FC) packages.

Exposure to Western Europe was also a contributing factor to the strong performance, driven primarily by the fund’s positions in several United Kingdom stocks which enhanced returns despite an underweighted allocation to this country’s market.

While the fund’s allocation to the world’s mature markets was the predominant factor that led to the fund’s positive return, the emerging markets also contributed positively to the results. Companies based in Turkey, Taiwan and Egypt boosted the fund’s returns. The Turkish bank Denizbank A.S. (DENIZ TI) was a solid performer in the portfolio. Denizbank’s growth has been fueled by maturing acquisitions and increased penetration of the retail banking segment. Loan growth is expected to continue to exceed industry averages in 2006.

Finland had a negative impact on performance due to a disappointing investment in tire manufacturer Nokian Renkaat Oyj (NRE1V FH). Nokian issued a profit warning in October, cautioning that high margin passenger tire sales were flat during the company’s fiscal third quarter due to high distributor inventories.

Several industry sectors had a significant impact on results, and the consumer discretionary sector led with a positive impact on returns. Japanese real estate companies were especially strong, including Urban Corporation (8868 JP) and Kenedix Inc. (4321 JP). Urban is a Japanese real estate firm specializing in condominium sales and management. The company has successfully capitalized on the Japanese residential real estate boom,

and signed a major financing agreement in June, 2005 with AIG Global Real Estate for property acquisition in Tokyo and Osaka. Kenedix Inc. (4321 JP) is a Japanese real estate securitization firm serving the Japanese REIT (real estate investment trust) market. Japanese REITS have been active asset buyers over the past two years, and Kenedix is a leader in the distribution market, securing over 90% of its contracts without competitive bidding.

Retailers were also strong within the consumer discretionary segment. South Korea-based CJ Home Shopping (035760 KS) sells clothing, kitchen items, appliances and jewelry through home shopping, internet and catalog distribution channels, and also operates a cable television business. Sales of financial services products have fueled growth and growth should continue as the company furthers its expansion into China. Point Inc. (2685 JP), based in Japan, operates a chain of clothing stores, and is a strong competitor in the medium-priced market segment with a focus on private-label brands. Earnings have exceeded expectations. South Africa-based Foschini Limited (FOS SJ) operates chain stores in the clothing, cosmetics, jewelry and sporting goods segments, and has benefited from strong like-for-like merchandise sales growth and an aggressive store opening schedule.

The industrial sector was the second largest contributor to performance after the consumer discretionary segment. Toho Titanium Co. Ltd. (5727 JP) was one of the top 3 performers in the fund for the year. Toho, a Japanese titanium smelter, benefited from tight capacity and high demand from aircraft manufacturers. Domestic sales were especially strong, supported by demand for titanium for re-export to plant projects in China and the Middle East.

Although the energy sector’s impact on the portfolio was positive, one stock hindered performance. Regal Petroleum PLC (RPT LN), based in the United Kingdom, is an independent oil and gas producer with properties in Ukraine, Greece, Romania and Egypt. The stock price declined on news of the failure of the company’s Kallirachi K-2 well.

Another holding that had a negative impact on results was Arbeit-Times Co. Ltd. (2341 JP), a Japanese publisher of free job information newspapers and provider of employment services. Revenue and profit estimates were lowered slightly in April, 2005 based on the company’s withdrawal from some business lines, including used-car magazines and paid-ad job magazines, and softness in the temporary staffing segment.

One stock in the portfolio, Singapore-based Citiraya Industries Ltd. (CTR SP), was no longer traded at year-end and had been written down in value earlier in the year. Trading in the company’s stock was halted in January, 2005 when it was announced that a governmental agency had launched a bribery and fraud investigation of the electronics recycler. The scope of the investigation included top management, and the CEO’s brother was later arrested and charged with helping his brother bribe employees of customers to re-sell microprocessor chips that were to have been destroyed.

I re-joined Driehaus Capital Management, Inc. as portfolio manager of the Driehaus International Discovery Fund effective March 1, 2005. I had previously been a senior member of the firm’s international research team and a portfolio manager of the firm’s international portfolios from 1997 through 2000, after which I managed American Century Investment Management’s International Opportunities Fund. My return enabled Emery Brewer, who had previously managed both the Driehaus International Discovery Fund and the Driehaus Emerging Markets Growth Fund, to turn his attention full-time to the Driehaus Emerging Markets Growth Fund, which he has managed since its 1997 inception. Ivo St. Kovachev, who had previously been a member of the Driehaus International Discovery Fund’s management team, left Driehaus Capital Management, Inc., the fund’s adviser, in February, 2005.

In 2005 we implemented changes to the portfolio management process which we believe had a positive impact on performance. In the first quarter, our research efforts were refocused, allowing our research professionals to align with a given product (rather than industry or geographic sector). The international portfolio management and research team continue to work together and share information as always, but now have a stronger focus specifically on the Driehaus International Discovery Fund’s performance.

In addition, investment analyst Christopher Cintavey joined the Driehaus International Discovery Fund research team in June, 2005. He covers Japan for the fund.

We are pleased with the fund’s performance in 2005. As we begin 2006, we are hopeful that the international markets and the Driehaus International Discovery Fund will again perform well for our shareholders, and we remain committed to finding the best growth ideas beyond our borders.

Sincerely,

(LYNETTE SCHROEDER SIG)

Lynette Schroeder

Portfolio Manager

¹ During these periods, the fund’s returns reflect fee waivers and/or reimbursements without which performance would have been lower.

Performance is historical and does not represent future results.

Regional Weightings*


Western Europe			36.6%
Japan			36.4%
Asia/Far East Ex-Japan			13.6%
North America			4.9%
Eastern Europe			2.3%
Africa			0.9%
South America			0.8%

Top Ten Holdings*


Kenedix, Inc.			2.2%
Point, Inc.			2.1%
Toho Titanium Co., Ltd.			2.1%
Urban Corp.			2.1%
CJ Home Shopping			1.9%
Yamada Denki Co., Ltd.			1.9%
Chiyoda Corp.			1.8%
Tomra Systems ASA			1.8%
Hitachi Construction Machinery Co., Ltd.			1.8%
Logitech International SA			1.8%

* All percentages are stated as a percent of net assets at December 31, 2005.

Driehaus International Discovery Fund

Performance Overview

The performance summarized below is historical and does not represent future results. Investment returns and principal value vary, and you may have a gain or loss when you sell shares. Performance data presented measures the change in the value of an investment in the Fund, assuming reinvestment of all dividends and capital gains. Average annual total return reflects annualized change.

The table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The graph compares the results of a $10,000 investment in the Fund since December 31, 1998 (the date of the Fund’s inception), with all dividends and capital gains reinvested, with the indicated indexes (and dividends reinvested) for the same period.




							Since Inception
Average Annual Total Returns as of 12/31/05	1 Year		3 Years		5 Years		(12/31/98 - 12/31/05)


Driehaus International Discovery Fund (DRIDX)¹		43.97%		37.81%		14.32%		27.35%
MSCI EAFE^® Growth Index²		13.28%		20.19%		1.92%		1.03%
MSCI AC World ex USA Index³		17.11%		26.20%		6.66%		6.31%
MSCI AC World ex USA Growth Index⁴		17.08%		22.74%		3.84%		3.02%

You cannot invest directly in any of these indices.

(PERFORMANCE GRAPH)

¹ The returns for the periods prior to July 1, 2003, reflect fee waivers and/or reimbursements without which performance would have been lower.

² The Morgan Stanley Capital International Europe, Australasia and Far East Growth Index (MSCI EAFE^® Growth Index) is a subset of the MSCI EAFE^® Index (a market capitalization-weighted index designed to measure equity performance in 21 developed markets, excluding the U.S. and Canada) and includes only the MSCI EAFE^® Index stocks which are categorized as growth stocks. Data is in U.S. dollars. Source: Morgan Stanley Capital International Inc.

³ The Morgan Stanley Capital International All Country World ex USA Index (MSCI AC World ex USA Index) is a market capitalization-weighted index designed to measure equity market performance in 48 global developed and emerging markets, excluding the U.S. Data is in U.S. dollars. Source: Morgan Stanley Capital International Inc.

⁴ The Morgan Stanley Capital International All Country World ex USA Growth Index (MSCI AC World ex USA Growth Index) was added as a benchmark because the index includes certain emerging markets countries in which the Fund may invest and which are not included in the MSCI EAFE^® Growth Index. The index is a subset of the MSCI AC World ex USA Index and is composed only of the MSCI AC World ex USA Index stocks which are categorized as growth stocks. Data is in U.S. dollars. Source: Morgan Stanley Capital International Inc.

Driehaus International Discovery Fund

Schedule of Investments

December 31, 2005


			Number		Market
			of		Value
			Shares		(Note A)


EQUITY SECURITIES — 92.7%

FAR EAST — 47.2%
	Japan — 36.4%
		ABC-Mart, Inc.		387,100	$	10,897,291
		Asset Managers Co., Ltd.		644		4,477,721
		Chiyoda Corp.		483,000		11,098,741
		Cosmos Pharmaceutical Corp.		35,200		1,265,511
		Cosmos Pharmaceutical Corp. When Issued**		35,200		1,265,511
		FCC Co., Ltd.		88,100		4,414,898
		Hitachi Construction Machinery Co., Ltd.		474,700		11,069,021
		Hitachi Koki Co., Ltd.		513,000		8,490,914
		Ibiden Co., Ltd.		189,300		10,144,368
		Kenedix, Inc.		2,095		13,198,669
		Komatsu, Ltd.		667,000		11,034,188
		Meiko Electronics Co., Ltd.		123,800		10,182,389
		Micronics Japan Co., Ltd.		58,400		2,287,769
		Miraca Holdings, Inc.		266,100		5,798,762
		Musashino Bank, Ltd.		62,200		3,459,804
		NGK Insulators, Ltd.		254,000		3,777,640
		Nihon Parkerizing Co., Ltd.		184,000		2,897,257
		Nippon Seiki Co., Ltd.		379,000		7,760,928
		Okuma Holdings, Inc.		682,000		8,628,007
		Pacific Management Corp.		959		3,317,692
		Pacific Management Corp. When Issued**		1,428		4,940,213
		Point, Inc.		150,900		12,577,666
		Right On Co., Ltd.		160,700		7,698,775
		Star Micronics Co., Ltd.		449,000		7,344,054
		Sysmex Corp.		155,300		5,925,722
		Toho Titanium Co., Ltd.		120,800		12,547,590
		Urban Corp.		115,700		12,498,563
		Yamada Denki Co., Ltd.		90,900		11,376,470
		Yamaha Motor Co., Ltd.		364,200		9,511,477

						219,887,611

	South Korea — 3.3%
		CJ Home Shopping		92,984		11,443,052
		Hyundai Department Store Co., Ltd.		96,430		8,165,809

						19,608,861

	Singapore — 3.1%
		Citiraya Industries, Ltd.**#		5,320,000		0
		Cosco Corp., Ltd.		6,894,000		8,956,208
		Hyflux, Ltd.		419,500		693,847
		StarHub, Ltd.		7,296,000		8,995,760

						18,645,815

	Australia — 2.5%
		Macquarie Bank, Ltd.		203,886		10,186,301
		Zinifex, Ltd.		926,509		4,673,059

						14,859,360

	Taiwan — 1.2%
		High Tech Computer Corp.		397,000		7,449,835

	China — 0.7%
		Guangzhou R&F Properties Co., Ltd.**		1,139,700		3,968,699

		Total FAR EAST				284,420,181

EUROPE — 38.9%
	Norway — 7.4%
		Aker Yards AS		136,030		6,530,117
		Eltek ASA**		252,100		4,174,088
		Fast Search & Transfer ASA**		2,883,000		10,593,454
		Petroleum Geo-Services ASA**		231,859		7,145,433
		Tandberg Television ASA**		420,520		5,560,785
		Tomra Systems ASA		1,548,700		11,082,958

						45,086,835

	United Kingdom — 5.9%
		Ashtead Group PLC		2,734,364		8,562,086
		Burren Energy PLC		474,236		7,441,170
		CSR PLC**		603,777		9,723,090
		NETeller PLC**		163,121		2,066,972
		Tullow Oil PLC		1,739,710		8,081,510

						35,874,828

	Denmark — 4.5%
		Bang & Olufsen AS		61,725		6,346,842
		GN Store Nord AS		744,800		9,750,238
		Sondagsavisen AS**		211,000		2,594,811
		Topdanmark AS**		96,050		8,336,933

						27,028,824

	Germany — 3.5%
		Bijou Brigitte Modische Accessoires AG		5,642		1,526,273
		Continental AG		32,265		2,864,112
		Software AG		132,667		6,463,171
		United Internet AG		160,727		6,136,652
		Wincor Nixdorf AG		41,498		4,390,681

						21,380,889

	Italy — 3.4%
		ERG SpA		383,591		9,237,029
		Geox SpA		560,894		6,172,244
		Tod’s SpA		72,404		4,880,822

						20,290,095

	Luxembourg — 2.7%
		Stolt Offshore SA**		641,940		7,466,299
		Tenaris SA — ADR		75,573		8,653,109

						16,119,408

	Switzerland — 2.5%
		Logitech International SA**		234,970		11,041,739
		Ypsomed Holding AG**		26,256		4,076,119

						15,117,858

Notes to Financial Statements are an integral part of this Schedule.

Driehaus International Discovery Fund

Schedule of Investments

December 31, 2005


			Number			Market
			of			Value
			Shares			(Note A)


	Spain — 2.5%
		Fadesa Inmobiliaria SA		263,729		$	8,692,407
		Indra Sistemas SA		315,856			6,173,751

							14,866,158

	France — 2.4%
		Axalto Holding NV**		98,438			2,713,056
		SR Teleperformance		74,804			2,337,985
		Vallourec SA		16,705			9,196,284

							14,247,325

	Turkey — 1.4%
		Denizbank AS**		1,263,215			8,184,473

	Belgium — 0.9%
		Option NV**		76,368			5,673,330

	Poland — 0.9%
		TVN SA**		216,756			5,204,786

	Sweden — 0.5%
		Munters AB		106,800			2,944,074

	Ireland — 0.4%
		Anglo Irish Bank Corp. PLC		169,183			2,569,782

		Total EUROPE					234,588,665

NORTH AMERICA — 4.9%
	Canada — 2.5%
		Precision Drilling Trust		121,160			4,000,276
		Trican Well Service, Ltd.**		226,247			10,899,249

							14,899,525

	Bermuda — 1.5%
		Marvell Technology Group, Ltd. — ADR**		157,046			8,808,710

	Mexico — 0.9%
		America Movil SA de CV — L — ADR		195,200			5,711,552

		Total NORTH AMERICA					29,419,787

AFRICA — 0.9%
	South Africa — 0.9%
		Foschini, Ltd.		668,041			5,500,583

		Total AFRICA					5,500,583

SOUTH AMERICA — 0.8%
	Brazil — 0.8%
		Lojas Renner SA**		159,500			5,115,214

		Total SOUTH AMERICA					5,115,214

		Total EQUITY SECURITIES (Cost $407,922,884)					559,044,430

EQUITY CERTIFICATES — 2.8%

FAR EAST — 2.8%
	India — 2.8%
		Bharat Heavy Electricals, Ltd.†		276,206			8,496,621
		Bharti Tele-Ventures, Ltd.**†		1,112,201			8,503,333

							16,999,954

		Total EQUITY CERTIFICATES (Cost $12,502,848)					16,999,954


	TOTAL INVESTMENTS (COST $420,425,732)			95.5	%	$	576,044,384
	Other Assets in Excess of Liabilities			4.5	%		27,204,777

Net Assets				100.0	%	$	603,249,161

The federal income tax basis and unrealized appreciation (depreciation) for all investments is as follows:
Basis						$	421,015,470

Gross Appreciation						$	159,723,375
Gross Depreciation							(4,694,461	)

Net Appreciation						$	155,028,914

** Non-income producing security

† Restricted security — Investments in securities not registered under the Securities Act of 1933, excluding 144A securities. At December 31, 2005, the value of these restricted securities amounted to $16,999,954 or 2.8% of net assets.

Additional information on each restricted holding is as follows:


	Acquisition		Acquisition
Security	Date(s)		Cost


Bharat Heavy Electricals, Ltd.		05/25/05 to 11/02/05	$	6,174,400
Bharti Tele-Ventures, Ltd.		12/02/04 to 12/21/05	$	6,328,448

ADR — American Depository Receipt

# This security has been halted from trading since January 24, 2005 and is being valued at a fair value as determined in good faith by or under the direction of the Driehaus Mutual Funds’ Board of Trustees.

Notes to Financial Statements are an integral part of this Schedule.

Driehaus International Discovery Fund

Schedule of Investments

December 31, 2005


	Percent of
Industry	Net Assets

Appliances		2.3%
Auto Parts		0.7%
Automobiles		1.3%
Banking		4.0%
Basic Industries/Multi-Industry		1.0%
Broadcasting & Publishing Services		1.3%
Business & Public Services		3.0%
Chemicals		2.2%
Construction		2.5%
Consumer Durables/Multi-Industry		2.1%
Consumer Non-Durables/Multi-Industry		3.3%
Consumer Services/Multi-Industry		4.2%
Department Stores		1.0%
Electrical & Electronics		4.1%
Electronic Components		11.4%
Energy Equipment		2.4%
Energy Sources		4.1%
Financial Services		0.3%
Gas Pipelines		1.4%
Health Care		1.6%
Industrial Components		1.1%
Industrial Machinery		1.4%
Insurance		1.4%
Machinery & Engineering		10.3%
Merchandising		3.4%
Metals — Nonferrous		2.9%
Oil		2.5%
Real Estate		4.1%
Recreation		1.6%
Semiconductors		1.5%
Technology/Multi-Industry		2.8%
Telecommunications		1.9%
Telephone Utilities		2.4%
Textiles & Apparel		4.0%
Other Assets in Excess of Liabilities		4.5%

TOTAL		100.0%

Notes to Financial Statements are an integral part of this Schedule.

Driehaus International Discovery Fund

Statement of Assets and Liabilities

December 31, 2005


ASSETS:
	Investments, at market value (Cost $420,425,732)			$	576,044,384
	Foreign currency (Cost $6,967,976)				7,036,828
	Cash				21,558,531
	Receivables:
		Dividends			296,267
		Interest			46,617
		Investment securities sold			11,119,332
		Fund shares sold			9,601,826
		Net unrealized appreciation on unsettled foreign currency forward contracts from transaction hedges			25,864
	Prepaid expenses and other assets				59,652


			TOTAL ASSETS		625,789,301


LIABILITIES:
	Payables:
		Investment securities purchased			16,993,416
		Fund shares redeemed			4,642,709
		Due to affiliates			712,133
	Accrued expenses				191,882


			TOTAL LIABILITIES		22,540,140


NET ASSETS				$	603,249,161

SHARES OUTSTANDING (Unlimited shares authorized, no par value)					14,641,797

NET ASSET VALUE PER SHARE				$	41.20


NET ASSETS CONSISTED OF THE FOLLOWING AT DECEMBER 31, 2005:
	Paid-in capital			$	574,671,440
	Accumulated net investment loss				(292,339	)
	Accumulated net realized loss				(126,811,121	)
	Unrealized net foreign exchange gain				62,529
	Unrealized net appreciation on investments				155,618,652

			NET ASSETS	$	603,249,161

Notes to Financial Statements are an integral part of this Statement.

Driehaus International Discovery Fund

Statement of Operations

For the year ended December 31, 2005


INVESTMENT LOSS:
	Income:
		Dividends (Net of non-reclaimable taxes of $240,796)			$	6,569,323
		Interest				286,475
		Other				20,932


			Total income			6,876,730


	Expenses:
		Investment advisory fee				5,889,585
		Administration fee				448,349
		Professional fees				185,582
		Federal and state registration fees				36,000
		Custodian fee				260,888
		Transfer agent fees				88,599
		Trustees’ fees				39,600
		Miscellaneous				203,427

		Total expenses				7,152,030


		Fees paid indirectly				(207,826	)

			Net expenses			6,944,204


				Net investment loss		(67,474	)


NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS:
		Net realized gain from security transactions				63,603,618
		Net realized foreign exchange loss				(573,917	)
		Net change in unrealized foreign exchange gain				(62,144	)
		Net change in unrealized appreciation of investments				96,247,912


			Net realized and unrealized gain on investments and foreign currency transactions			159,215,469


NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS					$	159,147,995

Notes to Financial Statements are an integral part of this Statement.

Driehaus International Discovery Fund

Statement of Changes in Net Assets


				For the year			For the year
				ended			ended
				December 31, 2005			December 31, 2004


INCREASE IN NET ASSETS:
	Operations:
		Net investment loss		$	(67,474	)	$	(163,581	)
		Net realized gain on investments and foreign currency transactions			63,029,701			20,131,509
		Net change in unrealized gain on investments and foreign currency transactions			96,185,768			15,335,681


			Net increase in net assets resulting from operations		159,147,995			35,303,609


	Distributions to shareholders:
		Net investment income			(446,477	)		—
		Capital gains			(54,300,819	)		(11,619,269	)

			Total distributions to shareholders		(54,747,296	)		(11,619,269	)


	Capital share transactions:
		Proceeds from shares sold			212,627,542			156,011,529
		Reinvestment of distributions			53,670,719			11,443,961
		Cost of shares redeemed			(112,461,237	)		(106,830,015	)
		Redemption fees			25,182			56,976

			Net increase in net assets derived from capital share transactions		153,862,206			60,682,451

			Total increase in net assets		258,262,905			84,366,791


NET ASSETS:

	Beginning of period			$	344,986,256		$	260,619,465

	End of period (Including accumulated net investment loss of $292,339 and $555,072, respectively)			$	603,249,161		$	344,986,256


	Capital share transactions are as follows:
		Shares issued			5,567,641			5,186,245
		Shares reinvested			1,341,768			382,485
		Shares redeemed			(3,162,244	)		(3,574,362	)

			Net increase from capital share transactions		3,747,165			1,994,368

Notes to Financial Statements are an integral part of this Statement.

Driehaus International Discovery Fund

Financial Highlights


			For the year			For the year			For the year			For the year			For the year
			ended			ended			ended			ended			ended
			December 31,			December 31,			December 31,			December 31,			December 31,
			2005			2004			2003			2002			2001


Net asset value, beginning of period			$	31.67		$	29.28		$	18.03		$	20.70		$	24.17

	INCOME (LOSS) FROM INVESTMENT OPERATIONS:
	Net investment income (loss)			0.02			(0.02	)		(0.15	)		(0.12	)		(0.24	)
	Net realized and unrealized gain (loss) on investments and foreign currency transactions			13.78			3.45			11.40			(2.57	)		(3.23	)

		Total income (loss) from investment operations		13.80			3.43			11.25			(2.69	)		(3.47	)

	LESS DISTRIBUTIONS:
	Dividends from net investment income			(0.04	)		—			—			—			—
	Distributions from capital gains			(4.23	)		(1.05	)		—			—			—

		Total distributions		(4.27	)		(1.05	)		—			—			—

Redemption fees added to paid-in capital				0.00	~		0.01			0.00	~		0.02			0.00	~

Net asset value, end of period			$	41.20		$	31.67		$	29.28		$	18.03		$	20.70

		Total Return		43.97	%		11.95	%		62.40	%		(12.90	)%		(14.36	)%
RATIOS/SUPPLEMENTAL DATA
	Net assets, end of period (in 000’s)		$	603,249		$	344,986		$	260,619		$	68,113		$	44,847
	Ratio of expenses before fees paid indirectly to average net assets			1.82	%		1.94	%		2.02	%†		2.26	%†		2.34	%†
	Ratio of net expenses to average net assets			1.77	%#		1.70	%#		2.02	%†#		1.86	%†#		2.31	%†#
	Ratio of net investment loss to average net assets			(0.02	)%#		(0.05	)%#		(1.11	)%†#		(0.71	)%†#		(1.12	)%†#
	Portfolio turnover			180.42	%		518.81	%		515.76	%		405.69	%		612.64	%

~ Amount represents less than $0.01 per share

† Such ratios are after administrative agent and transfer agent waivers and Adviser expense reimbursements, when applicable. PFPC Inc., the administrative agent and transfer agent, waived a portion of its fees from December 31, 1998 through December 31, 2001. The Adviser agreed to absorb other operating expenses to the extent necessary to ensure that the total Fund operating expenses (other than interest, taxes, brokerage commissions and other portfolio transaction expenses, capital expenditures, and extraordinary expenses) would not exceed the Fund’s operating expense cap for the first fifty-four months of its operations. For the period June 1, 1999 through June 30, 2002, the operating expense cap was 2.40% of average net assets. For the period July 1, 2002 through June 30, 2003, the Fund was reimbursed for expenses exceeding the 2.40% expense cap after reduction of amounts received through commission recapture programs that were applied to Fund expenses.

# Such ratios are net of fees paid indirectly (see Note B in the Notes to Financial Statements).

Notes to Financial Statements are an integral part of this Schedule.

Driehaus Emerging Markets Growth Fund — Portfolio Manager’s Letter

Dear Fellow Shareholders,

The Driehaus Emerging Markets Growth Fund was up 38.95% for the year ended December 31, 2005. This exceeded the performance of the fund’s major benchmark index, the Morgan Stanley Capital International (MSCI) Emerging Markets Index which gained 34.53% for the year.

The fund has also outpaced this index over longer periods. For the three years ended December 31, 2005, the average annualized return for the Driehaus Emerging Markets Growth Fund was 41.85% (versus a return of 38.35% for the index) and for the five years ended December 31, 2005, the average annualized return was 20.92% (versus 19.43% for the index). Since inception, the average annual total return is 17.90% versus 9.68% for the index.¹

The positive results for 2005 were primarily driven by strength in the second half of the year. After lagging the indices during the first half, the fund outperformed its benchmarks during the third and fourth quarters, exceeding each index by over 300 basis points in the third quarter and by over 500 basis points in the fourth quarter. The emerging markets sector gained strength in the final quarter of the year as economic strength in the U.S. and China positively impacted many emerging markets.

Companies based in Turkey, Taiwan and Egypt added to the fund’s return, and the most positive contribution to the fund’s return relative to the index came from our allocation to Taiwan. Our weighting was roughly in line with the index weighting, and much of the performance was due to stock selection within this market. Technology companies High Tech Computer Corp. (2498 TT) and Largan Precision Co. Ltd. (3008 TT) both enhanced the fund’s performance. High Tech makes Windows-based pocket personal computers and wireless personal digital assistants (PDAs). Continued strong demand for wireless PDAs and a solid product pipeline have driven the company’s growth. Largan Precision makes lenses and shutters for digital and film cameras, scanners and liquid crystal display (LCD) projectors. Largan’s main growth vehicle is their niche in phone camera lenses. The company had a 30% market share in the earlier generation .35 megapixel product line, and is currently ramping up production to meet the needs of the next generation 1.0 megapixel market.

Some emerging markets negatively impacted results. Our exposure to Israeli stocks hurt performance, and even though the Israeli market was relatively strong last year, a number of the companies that we held underperformed the market.

The portfolio was overweighted in financial stocks, and this industry group had the most positive impact on performance. Several individual stocks in this group, including Sberbank RF (SBER RU), Ghaungzhou R & F Properties (2777 HK) and Denizbank A.S. (DENIZ TI) were particularly strong performers. Sberbank, also known as the Savings Bank of the Russian Federation, is a provider of both consumer and commercial banking services. Consumer loan growth and faster-than-expected commission and fee income growth, have led to stronger-than-expected net profit growth. Guangzhou R & F Properties, which is traded in Hong Kong, develops, sells and manages real estate in Guangzhou and Beijing, China. The company operates in a large and relatively untapped market with strong brand recognition, and average net profits are expected to grow 60% over the next two years. Turkish bank Denizbank’s growth has been fueled by maturing acquisitions and increased penetration of the retail banking segment. Loan growth is expected to exceed industry averages in 2006.

Although the information technology and telecommunications industries were not significant contributors to the fund’s performance relative to the index, the three best stocks in the fund were in these sectors. High Tech Computer Corp. (detailed above) was the fund’s best performing stock, followed by Orascom Telecom Holdings SAE (OTLD LI) and NHN Corp. (035420 KS). Orascom, based in Egypt, operates and participates in joint ventures that run GSM (global systems for mobile communications) networks and has operations in Africa and the Middle East. The stock has been a strong performer based on its strong presence in relatively underpenetrated cellular markets and population growth in the markets it serves. NHN Corp., based in South Korea, provides Internet sites with web portal services (such as search engine, online game and content development) and Internet marketing services. The company has benefited from growth in search ad revenues (which still has significant growth potential as the volume of search queries is relatively low). In addition, the monetization of search queries is increasing, as has NHN’s market share in the search ad segment.

The consumer staples industry represented the largest negative impact of any industry group on the fund, relative to the performance of the index. This was largely due to the fact that the fund was underweighted in this relatively strong sector (rather than any specific stock situation).

Several stocks had a negative impact on the fund’s return. Shanda Interactive Entertainment Ltd. (SNDA US), based in China, operates online games licensed from third parties as well as developed in-house. The company’s two major games, Mir II and Woool, have reached the mature phase of the gaming cycle, and the pipeline is not very strong, which led to disappointing price performance. JD Group Limited (JDG SJ), a South African furniture, appliance and home entertainment products retailer, sells a high proportion of goods on credit. Lower interest rates negatively impacted credit revenues, and there were increasing concerns about potential credit regulation in South Africa. Korea Zinc Co. Ltd. (010130 KS), a smelter of non-ferrous metals including zinc, electrolytic gold, silver, lead, sulfuric acid and copper, posted an operating profit shortfall during the first quarter of 2005 due to weakness in the U.S. dollar. Lastly, Singapore-based Citiraya Industries Limited (CTR SP) was written down in value earlier in the year and was no longer trading at year end. Trading in Citiraya was halted in January, 2005 as news of a government-led investigation into fraud at the company surfaced. It was later found that the CEO’s brother had been bribing employees of Citiraya’s customers to re-sell chips that Citiraya was supposed to have destroyed.

Effective March 1, 2005, Lynette Schroeder rejoined the firm to manage the Driehaus International Discovery Fund. This allowed me to focus exclusively on the management of the Driehaus Emerging Markets Growth Fund, which I have managed since its 1997 inception. As always, we continue to seek the fastest growing companies in the world’s emerging markets, and we thank you for your continued interest in the Driehaus Emerging Markets Growth Fund.

Sincerely,

/s/ Emery R. Brewer

Emery R. Brewer

Portfolio Manager

¹ During these periods, the fund’s returns reflect fee waivers and/or reimbursements without which performance would have been lower.

Performance is historical and does not represent future results.

Regional Weightings*


Asia/ Far East Ex-Japan			50.9%
Western Europe			11.2%
South America			11.1%
Africa			7.1%
North America			6.6%
Eastern Europe			5.6%
Middle East			1.4%

Top Ten Holdings*


NHN Corp.			2.2%
Sberbank RF			2.0%
Guangzhou R & F Properties Co., Ltd			1.9%
Unimicron Technology Corp.			1.9%
Urbi Desarrollos Urbanos SA de CV			1.8%
Hyundai Motor Co., Ltd.			1.8%
Wal-Mart de Mexico SA de CV			1.7%
Zijin Mining Group Co., Ltd.			1.7%
Shinhan Financial Group Co., Ltd.			1.7%
America Movil SA de CV — L — ADR			1.7%

* All percentages are stated as a percent of net assets at December 31, 2005.

Driehaus Emerging Markets Growth Fund

Performance Overview

The table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The graph compares the results of a $10,000 investment in the Fund since December 31, 1997 (the date of the Fund’s inception), with all dividends and capital gains reinvested, with the indicated indexes (and dividends reinvested) for the same period.




							Since Inception
Average Annual Total Returns as of 12/31/05	1 Year		3 Years		5 Years		(12/31/97 - 12/31/05)


Driehaus Emerging Markets Growth Fund (DREGX)¹		38.95%		41.85%		20.92%		17.90%
MSCI Emerging Markets Index²		34.53%		38.35%		19.43%		9.68%
MSCI Emerging Markets Growth Index³		35.40%		34.80%		16.18%		8.80%

You cannot invest directly in any of these indices.

(PERFORMANCE GRAPH)

¹ The returns for the periods prior to July 1, 2003, reflect fee waivers and/or reimbursements without which performance would have been lower.

² The Morgan Stanley Capital International Emerging Markets Index (MSCI Emerging Markets Index) is a market capitalization-weighted index designed to measure equity market performance in 26 global emerging markets. Data is in U.S. dollars. Source: Morgan Stanley Capital International Inc.

³ The Morgan Stanley Capital International Emerging Markets Growth Index (MSCI Emerging Markets Growth Index) is a subset of the MSCI Emerging Markets Index and includes only the MSCI Emerging Markets Index stocks which are categorized as growth stocks. The index was added in August 2005 as a comparison to the Fund’s growth-oriented investment style. Data is in U.S. dollars. Source: Morgan Stanley Capital International Inc.

Driehaus Emerging Markets Growth Fund

Schedule of Investments

December 31, 2005


					Market
			Number		Value
			of Shares		(Note A)


EQUITY SECURITIES — 89.2%

FAR EAST — 46.2%
	South Korea — 16.4%
		Daishin Securities Co., Ltd.		142,500	$	3,185,933
		Fine DNC Co., Ltd.**		167,621		1,129,247
		Handsome Co., Ltd.		190,430		2,825,790
		Humax Co., Ltd.		98,629		2,658,792
		Hynix Semiconductor, Inc.**		110,560		3,860,877
		Hyundai Motor Co.		43,960		4,231,397
		LG Card Co., Ltd.**		54,070		2,701,227
		LG Electronics, Inc.		23,520		2,077,792
		NHN Corp.**		19,618		5,240,006
		Samsung Fire & Marine Insurance Co., Ltd.		18,654		2,362,083
		Shinhan Financial Group Co., Ltd.		99,170		4,027,233
		Shinsegae Co., Ltd.		8,938		3,917,034
		Wooree ETI Co., Ltd.**		102,142		1,626,835

						39,844,246

	Taiwan — 12.3%
		Acer, Inc.		1,345,260		3,380,925
		Asustek Computer, Inc.		918,000		2,824,486
		Compeq Manufacturing Co., Ltd.**		4,344,000		2,507,693
		Delta Electronics, Inc.		1,533,000		3,142,915
		High Tech Computer Corp.		134,000		2,514,554
		Janfusun Fancyworld Corp.**		3,932,000		2,569,308
		Largan Precision Co., Ltd.		183,750		2,899,563
		Taiwan Fertilizer Co., Ltd.		1,726,000		2,011,165
		Taiwan Semiconductor Manufacturing Co., Ltd. — ADR		353,824		3,506,396
		Unimicron Technology Corp.		3,312,000		4,681,486

						30,038,491

	China — 10.3%
		China Medical Technologies, Inc. — ADR**		58,100		1,850,485
		China Mengniu Dairy Co., Ltd.		2,600,000		2,213,151
		China Mobile, Ltd.		604,500		2,861,252
		Focus Media Holding, Ltd. — ADR**		87,029		2,938,969
		Guangzhou R & F Properties Co., Ltd.**		1,346,800		4,689,869
		Lee & Man Paper Manufacturing Ltd.		2,238,000		2,482,289
		Li Ning Co., Ltd.		3,746,400		2,657,484
		Suntech Power Holdings Co., Ltd.**		46,200		1,258,950
		Zijin Mining Group Co., Ltd.		9,164,800		4,048,344

						25,000,793

	Indonesia — 1.8%
		PT Bank Mandiri Tbk		11,886,500		1,983,099
		PT Perusahaan Gas Negara Tbk		3,273,000		2,297,426

						4,280,525

	Malaysia — 1.4%
		Digi.com Berhad**		1,591,100		3,283,657

	Thailand — 1.2%
		Bank of Ayudhya Public Co., Ltd. — NVDR		7,872,300		2,859,166

	Pakistan — 1.2%
		Fauji Fertilizer Co., Ltd.		1,228,535		2,815,949

	Singapore — 0.9%
		Citiraya Industries, Ltd.**#		2,216,000		0
		Olam International, Ltd.		2,358,000		2,141,509

						2,141,509

	India — 0.7%
		Sify, Ltd. — ADR**		154,602		1,663,518

		Total FAR EAST				111,927,854

EUROPE — 16.8%
	Russia — 4.2%
		Lukoil — ADR		51,703		3,050,477
		Sberbank RF		3,600		4,716,000
		Vimpel Communications — ADR**		53,400		2,361,882

						10,128,359

	United Kingdom — 3.5%
		BHP Billiton PLC		171,057		2,794,395
		Burren Energy PLC		124,394		1,951,849
		Cairn Energy PLC**		47,229		1,560,134
		Tullow Oil PLC		419,811		1,950,157

						8,256,535

	Turkey — 3.2%
		Denizbank AS**		515,117		3,337,485
		Dogus Otomotiv Servis ve Ticaret AS		514,940		2,611,876
		Yapi Kredi Koray Gayrimenkul Yatirim Ortakligi AS**		544,934		1,839,984

						7,789,345

	Poland — 2.4%
		Grupa Lotos SA**		175,979		2,394,530
		TVN SA**		142,321		3,417,439

						5,811,969

	Austria — 1.5%
		Raiffeisen International Bank Holding AG**		56,200		3,696,011

	Kazakhstan — 1.3%
		Kazakhmys PLC**		237,584		3,161,764

Notes to Financial Statements are an integral part of this Schedule.

Driehaus Emerging Markets Growth Fund

Schedule of Investments

December 31, 2005


					Market
			Number		Value
			of Shares		(Note A)


	Luxembourg — 0.7%
		Tenaris SA — ADR		15,500	$	1,774,750

		Total EUROPE				40,618,733

SOUTH AMERICA — 11.1%
	Brazil — 11.1%
		Banco Bradesco SA		126,360		3,484,992
		Cyrela Brazil Realty SA		179,710		2,459,359
		Gol-Linhas Aereas Inteligentes SA — ADR		137,196		3,870,299
		Localiza Rent-a-Car SA		189,500		2,320,226
		Natura Cosmeticos SA		54,640		2,406,375
		Net Servicos de Comunicacao SA (Pref.)**		8,117,200		3,714,410
		Petroleo Brasileiro SA — ADR		46,200		3,292,674
		Submarino SA		169,800		3,013,600
		Tele Norte Leste Participacoes SA — ADR		120,904		2,166,600

						26,728,535

		Total SOUTH AMERICA				26,728,535

AFRICA — 7.1%
	South Africa — 7.1%
		Aspen Pharmacare Holdings, Ltd.**		567,441		2,995,264
		Foschini, Ltd.		352,060		2,898,827
		Harmony Gold Mining Co., Ltd.**		201,528		2,704,026
		MTN Group, Ltd.		330,511		3,246,347
		Nedbank Group, Ltd.		182,334		2,881,612
		Sasol, Ltd.		67,239		2,406,896

						17,132,972

		Total AFRICA				17,132,972

NORTH AMERICA — 6.6%
	Mexico — 6.2%
		America Movil SA de CV — L — ADR		136,945		4,007,011
		Fomento Economico Mexicano, SA de CV — ADR		33,000		2,392,830
		Urbi Desarrollos Urbanos SA de CV**		634,736		4,387,782
		Wal-Mart de Mexico SA de CV		748,600		4,154,000

						14,941,623

	Canada — 0.4%
		Yamana Gold Inc.**		148,800		983,568

		Total NORTH AMERICA				15,925,191

MIDDLE EAST — 1.4%
	Israel — 1.4%
		Teva Pharmaceutical Industries, Ltd. — ADR		77,100		3,316,071

		Total MIDDLE EAST				3,316,071

		Total EQUITY SECURITIES (Cost $158,603,984)				215,649,356


EQUITY CERTIFICATES — 4.6%

FAR EAST — 4.6%
	India — 4.6%
		Bharat Heavy Electricals, Ltd.†		59,906		1,842,822
		Bharti Tele-Ventures, Ltd.**†		378,011		2,890,083
		Cipla, Ltd.†		269,609		2,655,379
		Jaiprakash Associates, Ltd.†		440,691		3,805,896

						11,194,180

		Total EQUITY CERTIFICATES (Cost $8,208,494)				11,194,180


RIGHTS — 0.1%

FAR EAST — 0.1%
	Korea — 0.1%
		Fine DNC Co., Ltd. (Foreign) — Rights**		71,578		125,333

		Total RIGHTS (Cost $0)				125,333


	TOTAL INVESTMENTS (COST $166,812,478)			93.9%	$	226,968,869
	Other Assets in Excess of Liabilities			6.1%		14,617,958

Net Assets				100.0%	$	241,586,827

Notes to Financial Statements are an integral part of this Schedule.

Driehaus Emerging Markets Growth Fund

Schedule of Investments

December 31, 2005


The federal income tax basis and unrealized appreciation (depreciation) for all investments is as follows:

Basis:		$	169,492,077

Gross Appreciation		$	58,935,183
Gross Depreciation			(1,458,391	)

	Net Appreciation	$	57,476,792

** Non-income producing security

† Restricted security — Investments in securities not registered under the Securities Act of 1933, excluding 144A securities. At December 31, 2005, the value of these restricted securities amounted to $11,194,180 or 4.6% of net assets.

Additional information on each restricted holding is as follows:


	Acquisition		Acquisition
Security	Date(s)		Cost


Bharat Heavy Electricals, Ltd.		10/31/05 to 12/13/05	$	1,545,604
Bharti Tele-Ventures, Ltd.		10/07/04 to 11/11/05	$	1,375,400
Cipla, Ltd.		07/15/05 to 12/12/05	$	2,190,865
Jaiprakash Associates, Ltd.		08/05/05 to 12/28/05	$	3,096,625

ADR — American Depository Receipt

NVDR — Non-Voting Depository Receipt

Notes to Financial Statements are an integral part of this Schedule.

Driehaus Emerging Markets Growth Fund

Schedule of Investments

December 31, 2005


	Percent of
Industry	Net Assets

Airlines		1.6%
Automobiles		3.8%
Banking		9.5%
Beverages		1.0%
Broadcasting & Publishing Services		1.4%
Business & Public Services		2.9%
Chemicals		3.0%
Consumer Durables/ Multi-Industry		2.3%
Consumer Non-Durables/ Multi-Industry		1.0%
Consumer Services/ Multi-Industry		3.4%
Drugs		1.4%
Electrical & Electronics		5.0%
Electronic Components		7.7%
Energy Equipment		1.0%
Energy Sources		3.7%
Financial Services		4.9%
Food & Household		1.8%
Gas Pipelines		0.7%
Gold Mining		3.2%
Health Care		2.3%
Industrial Machinery		0.8%
Insurance		1.0%
International Trading		1.2%
Leisure & Tourism		1.0%
Medical Instruments		0.8%
Merchandising		5.6%
Metals — Nonferrous		2.5%
Oil		2.6%
Real Estate		2.9%
Semiconductors		1.4%
Software & EDP Services		0.7%
Technology/ Multi-Industry		2.4%
Telecommunications		4.7%
Telecommunications Equipment & Services		1.0%
Telephone Utilities		3.7%
Other Assets in Excess of Liabilities		6.1%

TOTAL		100.0%

Notes to Financial Statements are an integral part of this Schedule.

Driehaus Emerging Markets Growth Fund

Statement of Assets and Liabilities

December 31, 2005


ASSETS:
	Investments, at market value (Cost $166,812,478)			$	226,968,869
	Foreign currency (Cost $3,359,450)				3,411,139
	Cash				11,724,886
	Receivables:
		Dividends			348,112
		Interest			18,383
		Investment securities sold			4,297,063
		Fund shares sold			2,722,148
		Net unrealized appreciation on unsettled foreign currency forward contracts from transaction hedges			5,986
	Prepaid expenses and other assets				40,793


			TOTAL ASSETS		249,537,379


LIABILITIES:
	Payables:
		Investment securities purchased			7,284,828
		Fund shares redeemed			206,662
		Distribution payable			4,824
		Due to affiliates			287,917
		Foreign taxes			7,642
	Accrued expenses				158,679


			TOTAL LIABILITIES		7,950,552


NET ASSETS				$	241,586,827

SHARES OUTSTANDING (Unlimited shares authorized, no par value)					8,538,540

NET ASSET VALUE PER SHARE				$	28.29


NET ASSETS CONSISTED OF THE FOLLOWING AT DECEMBER 31, 2005:
	Paid-in capital			$	182,168,744
	Accumulated net investment loss				(152,608	)
	Accumulated net realized loss				(644,733	)
	Unrealized net foreign exchange gain				59,033
	Unrealized net appreciation on investments				60,156,391

			NET ASSETS	$	241,586,827

Notes to Financial Statements are an integral part of this Statement.

Driehaus Emerging Markets Growth Fund

Statement of Operations

For the year ended December 31, 2005


INVESTMENT LOSS:
	Income:
		Dividends (Net of non-reclaimable taxes of $322,397)				$	3,044,332
		Interest					79,050
		Other					1,295


			Total income				3,124,677


	Expenses:
		Investment advisory fee					2,350,950
		Administration fee					218,318
		Professional fees					111,897
		Federal and state registration fees					26,500
		Custodian fee					336,026
		Transfer agent fees					53,401
		Trustees’ fees					26,400
		Miscellaneous					127,343

		Total expenses					3,250,835


		Fees paid indirectly					(94,456	)

				Net expenses			3,156,379


					Net investment loss		(31,702	)


NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS:
		Net realized gain from security transactions					26,582,648
		Net realized foreign exchange loss					(806,952	)
		Net change in unrealized foreign exchange gain					12,332
		Net change in unrealized appreciation of investments					28,761,259


				Net realized and unrealized gain on investments and foreign currency transactions			54,549,287


NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS						$	54,517,585

Notes to Financial Statements are an integral part of this Statement.

Driehaus Emerging Markets Growth Fund

Statement of Changes in Net Assets


				For the year			For the year
				ended			ended
				December 31, 2005			December 31, 2004


INCREASE IN NET ASSETS:
	Operations:
		Net investment loss		$	(31,702	)	$	(301,840	)
		Net realized gain on investments and foreign currency transactions			25,775,696			15,605,052
		Net change in unrealized gain on investments and foreign currency transactions			28,773,591			10,297,495


			Net increase in net assets resulting from operations		54,517,585			25,600,707


	Distributions to shareholders:
		Net investment income			(570,827	)		(245,634	)
		Capital gains			(25,810,044	)		(11,194,675	)

			Total distributions to shareholders		(26,380,871	)		(11,440,309	)


	Capital share transactions:
		Proceeds from shares sold			119,850,579			56,874,273
		Reinvestment of distributions			25,961,648			11,397,087
		Cost of shares redeemed			(75,911,982	)		(38,979,744	)
		Redemption fees			70,067			42,180

			Net increase in net assets derived from capital share transactions		69,970,312			29,333,796

			Total increase in net assets		98,107,026			43,494,194


NET ASSETS:

	Beginning of period			$	143,479,801		$	99,985,607

	End of period (Including accumulated net investment loss of $152,608 and $702,077, respectively)			$	241,586,827		$	143,479,801


	Capital share transactions are as follows:
		Shares issued			4,518,939			2,661,957
		Shares reinvested			938,938			530,591
		Shares redeemed			(3,157,344	)		(1,881,701	)

			Net increase from capital share transactions		2,300,533			1,310,847

Notes to Financial Statements are an integral part of this Statement.

Driehaus Emerging Markets Growth Fund

Financial Highlights


			For the year			For the year			For the year			For the year			For the year
			ended			ended			ended			ended			ended
			December 31,			December 31,			December 31,			December 31,			December 31,
			2005			2004			2003			2002			2001


Net asset value, beginning of period			$	23.00		$	20.29		$	12.26		$	13.27		$	13.57

	INCOME (LOSS) FROM INVESTMENT OPERATIONS:
	Net investment income (loss)			0.04			(0.01	)		0.00			(0.09	)		(0.11	)
	Net realized and unrealized gain (loss) on investments and foreign currency transactions			8.83			4.75			8.03			(0.93	)		(0.16	)

		Total income (loss) from investment operations		8.87			4.74			8.03			(1.02	)		(0.27	)

	LESS DISTRIBUTIONS:
	Dividends from net investment income			(0.08	)		(0.04	)		—			—			(0.03	)
	Distributions from capital gains			(3.51	)		(2.00	)		—			—			—

		Total distributions		(3.59	)		(2.04	)		—			—			(0.03	)

Redemption fees added to paid-in capital				0.01			0.01			0.00	~		0.01			0.00	~

Net asset value, end of period			$	28.29		$	23.00		$	20.29		$	12.26		$	13.27

		Total Return		38.95	%		24.12	%		65.50	%		(7.61	)%		(1.98	)%
RATIOS/SUPPLEMENTAL DATA
	Net assets, end of period (in 000’s)		$	241,587		$	143,480		$	99,986		$	35,932		$	21,953
	Ratio of expenses before fees paid indirectly to average net assets			2.07	%		2.23	%		2.35	%†		2.50	%†		2.50	%†
	Ratio of net expenses to average net assets			2.01	%#		2.03	%#		2.34	%†#		2.16	%†#		2.49	%†#
	Ratio of net investment income (loss) to average net assets			(0.02	)%#		(0.29	)%#		0.04	%†#		(0.76	)%†#		(0.79	)%†#
	Portfolio turnover			349.69	%		356.90	%		432.47	%		355.14	%		505.50	%

~ Amount represents less than $0.01 per share

† Such ratios are after administrative agent and transfer agent waivers and Adviser expense reimbursements, when applicable. PFPC Inc., the administrative agent and transfer agent, waived a portion of its fees from December 31,1997 through December 31, 2000. The Adviser agreed to absorb other operating expenses to the extent necessary to ensure that the total Fund operating expenses (other than interest, taxes, brokerage commissions and other portfolio transaction expenses, capital expenditures, and extraordinary expenses) would not exceed the Fund’s operating expense cap for the first sixty-six months of its operations. For the period June 1, 1999 through June 30, 2002, the operating expense cap was 2.50% of average net assets. For the period July 1, 2002 through June 30, 2003, the Fund was reimbursed for expenses exceeding the 2.50% expense cap after reduction of amounts received through commission recapture programs that were applied to Fund expenses.

# Such ratios are net of fees paid indirectly (see Note B in the Notes to Financial Statements).

Notes to Financial Statements are an integral part of this Schedule.

Driehaus Mutual Funds

Notes to Financial Statements


A.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization

The Driehaus Mutual Funds (the “Trust”) is a registered management investment company, organized as a Delaware statutory trust, with two separate series (“Funds”). The Trust was organized under an Agreement and Declaration of Trust dated May 31, 1996 and may issue an unlimited number of full and fractional units of beneficial interest (shares) without par value. The two Funds included in the Trust are as follows:


Fund	Commencement of Operations


Driehaus International Discovery Fund		12/31/98
Driehaus Emerging Markets Growth Fund		12/31/97

The investment objective of the Funds is to maximize capital appreciation.

The Driehaus International Discovery Fund seeks to achieve its objective by generally investing in equity securities of small to mid-size foreign companies; however, the Fund may shift its focus toward large cap foreign stocks when market conditions suggest doing so will help the Fund achieve its objective.

The Driehaus Emerging Markets Growth Fund seeks to achieve its objective by investing primarily in equity securities of emerging markets companies.

Fiscal Year End

The fiscal year end for the Funds is December 31.

Securities Valuation and Transactions

Equity securities are valued at the last sale price as of the close of the appropriate exchange or other designated time. In addition, if quotations are not readily available, if the values have been materially affected by events occurring after the closing of a foreign market, or if there has been a movement in the United States market that exceeds a certain threshold, assets may be valued at fair value as determined in good faith by or under the direction of the Trust’s Board of Trustees. Events that may materially affect asset values that could cause a fair value determination include, but are not limited to: corporate announcements relating to a specific security; natural and other disasters which may impact an entire market or region; and political and other events which may be global or impact a particular country or region.

Securities transactions are accounted for on trade date. The cost of investments sold is determined by the use of specific identification method for both financial reporting and income tax purposes. Interest income is recorded on an accrual basis. Dividend income, net of non-reclaimable foreign taxes withheld, is recorded on the ex-dividend date.

The Funds determine income and expenses daily.

Federal Income Taxes

No provision is made for Federal income taxes since each Fund has elected to be taxed as a “regulated investment company” under Subchapter M of the Internal Revenue Code (the “Code”) and has made and declared all the required distributions to its shareholders in amounts sufficient to relieve the Fund from all or substantially all Federal income and excise taxes under provisions of current Federal tax law.

The amount of dividends and distributions from net investment income and net realized capital gains are determined in accordance with Federal income tax regulations, which may differ from generally accepted accounting principles.

For the year ended December 31, 2005, the following permanent reclassifications were recorded to the components of net assets to reflect tax character. These reclassifications relate primarily to foreign currency

Driehaus Mutual Funds

Notes to Financial Statements — (Continued)

losses, sales of passive foreign investment companies and net operating losses. Results of operations and net assets were not affected by these classifications.


	Driehaus			Driehaus
	International			Emerging Markets
	Discovery Fund			Growth Fund

Undistributed ordinary income	$	776,684		$	1,151,998
Undistributed net realized gain		(776,684	)		(1,151,998	)

During the year ended December 31, 2005, the Driehaus International Discovery Fund utilized $5,786,701 of capital loss carryforwards and as of December 31, 2005, the Fund has capital loss carryforwards of $111,765,702 expiring in 2008 and $24,839,330 expiring in 2009. During the year ended December 31, 2005, the Driehaus Emerging Markets Growth Fund utilized $949,637 of capital loss carryforwards and as of December 31, 2005, the Fund has capital loss carryforwards of $645,275 expiring in 2008 and $707,360 expiring in 2009. To the extent that the Funds realize future net capital gains, those capital gains will be offset by any unused capital loss carryforward subject to the limitations described below. For the year ended December 31, 2005, the Driehaus International Discovery Fund and the Driehaus Emerging Markets Growth Fund realized no post-October capital losses. The Driehaus International Discovery Fund realized post-October foreign currency losses of $292,339, which were deferred for tax purposes and will be recognized on January 1, 2006, and the Driehaus Emerging Markets Growth Fund realized post-October foreign currency losses of $152,608 which were deferred for tax purposes and will be recognized on January 1, 2006.

Included in the capital loss carryforward amounts stated above are capital losses that the Driehaus International Discovery Fund inherited from its merger with the Driehaus International Growth Fund and the Driehaus European Opportunity Fund on September 29, 2003 of approximately $133,980,941 and $2,624,091, respectively, which may be applied against any realized net taxable capital gains in future years or until December 31, 2009. Section 382 of the Code imposes certain limitations that will likely reduce the Fund’s ability to use the majority of these capital loss carryforwards.

Included in the capital loss carryforward amounts stated above are capital losses that the Driehaus Emerging Markets Growth Fund inherited from its merger with the Driehaus Asia Pacific Growth Fund on September 29, 2003 of approximately $1,352,635, which may be applied against any realized net taxable capital gains in future years or until December 31, 2009. Section 382 of the Code imposes certain limitations that will likely reduce the Fund’s ability to use the majority of these capital loss carryforwards.

Distributions to Shareholders

The tax character of distributions paid during the fiscal years ended December 31, 2005 and December 31, 2004 was as follows:



		Driehaus				Driehaus
		International				Emerging Markets
		Discovery Fund				Growth Fund

Distributions paid from:		2005		2004		2005		2004

Ordinary income		$	41,961,124	$	4,447,267	$	16,037,581	$	5,508,814
Net long-term capital gains			12,786,172		7,172,002		10,343,290		5,931,495

	Total distributions paid	$	54,747,296	$	11,619,269	$	26,380,871	$	11,440,309

Driehaus Mutual Funds

Notes to Financial Statements — (Continued)

As of December 31, 2005, the components of net assets on a tax basis were as follows:


		Driehaus			Driehaus
		International			Emerging Markets
		Discovery Fund			Growth Fund

Undistributed ordinary income		$	6,024,483		$	1,568,624
Undistributed long-term capital gain			4,359,166			1,818,878

	Accumulated earnings	$	10,383,649		$	3,387,502
Paid-in capital			574,671,440			182,168,744
Accumulated capital and other losses			(136,897,371	)		(1,505,244	)
Unrealized appreciation/(depreciation) on foreign currency			62,529			59,033
Unrealized appreciation on investments			155,028,914			57,476,792

	Net assets	$	603,249,161		$	241,586,827

The differences between book-basis and tax-basis unrealized appreciation are attributable primarily to the tax deferral of losses on wash sales.

Foreign Currency Translation

Foreign currency is translated into U.S. dollar values based upon the current rates of exchange on the date of the Funds’ valuations.

Net realized foreign exchange gains or losses which are reported by the Funds result from currency gains and losses on transaction hedges arising from changes in exchange rates between the trade and settlement dates on forward contracts underlying securities transactions, and the difference between the amounts accrued for dividends, interest, and foreign taxes and the amounts actually received or paid in U.S. dollars for these items. Net unrealized foreign exchange gains and losses result from changes in the U.S. dollar value of assets and liabilities (other than investments in securities), which are denominated in foreign currencies, as a result of changes in exchange rates.

Net realized foreign exchange gains or losses on portfolio hedges result from the use of forward contracts to hedge portfolio positions denominated or quoted in a particular currency in order to reduce or limit exposure in that currency. The Funds had no portfolio hedges during the year ended December 31, 2005.

The Funds do not isolate that portion of the results of operations which results from fluctuations in foreign exchange rates on investments. These fluctuations are included with the net realized gain (loss) from security transactions and the net change in unrealized appreciation (depreciation) of investments.

Use of Estimates

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 amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of net increases or decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

Indemnifications

Under the Trust’s organizational documents, the Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, in the normal course of business, the Trust enters into contracts that provide general indemnifications to other parties. The Funds’ maximum exposure under these agreements is unknown as this would involve future claims that may be made against the Funds that have not yet occurred. However, the Funds have not had prior claims or losses pursuant to these contracts and expect the risk of loss to be remote.

Driehaus Mutual Funds

Notes to Financial Statements — (Continued)


B.	INVESTMENT ADVISORY FEES, TRANSACTIONS WITH AFFILIATES, AND ADMINISTRATIVE FEES

Richard H. Driehaus, the President of the Trust, is also the Chairman of the Board, sole director, and sole shareholder of Driehaus Capital Management, Inc. (“DCM”), a registered investment adviser, and of Driehaus Securities Corporation (“DSC”), a registered broker-dealer.

DCM serves as the Funds’ investment adviser. In return for its services to the Funds, DCM receives a monthly fee, computed and accrued daily at an annual rate of 1.5% of each Fund’s average daily net assets.

The amounts accrued and payable to DCM during the year ended December 31, 2005, are as follows:


			Advisory Fees
			Payable
			(included in Due
Fund	Advisory Fees		to affiliates)


Driehaus International Discovery Fund	$	5,889,585	$	712,133
Driehaus Emerging Markets Growth Fund		2,350,950		287,917

The Funds direct certain portfolio trades, subject to obtaining the best price and execution, to brokers who have agreed to rebate to the Funds part of the commissions generated. Such rebates are currently used to offset a portion of the Funds’ operating expenses. For the year ended December 31, 2005, these arrangements reduced the expenses of the Driehaus International Discovery Fund and the Driehaus Emerging Markets Growth Fund by $207,826 (2.9%) and $94,456 (2.9%), respectively.

DSC is the Funds’ distributor. DSC also acts as a broker for the Funds for domestically traded securities. For the year ended December 31, 2005, the Funds paid the following brokerage commissions:


	Total		Commissions		Shares Traded
Fund	Commissions		Paid to DSC		through DSC


Driehaus International Discovery Fund	$	3,319,794	$	104,376		4,684,728
Driehaus Emerging Markets Growth Fund		2,902,135		326,637		8,488,543

A portion of these commissions are, in turn, paid by DSC to third parties for clearing and execution services.

Certain officers of the Trust are also officers of DCM and DSC. No such officers received compensation from the Funds.

PFPC Inc. (“PFPC”), an indirect subsidiary of PNC Bank Corp., serves as the Funds’ administrative and accounting agent. In compensation for these services, PFPC receives the larger of a monthly minimum fee or a monthly fee based upon average net assets. PFPC also acts as the transfer agent and dividend disbursing agent for the Funds. In compensation for these services, PFPC receives a monthly fee based on shareholder processing activity during the month.

C. DERIVATIVES AND OTHER FINANCIAL INSTRUMENTS

The Funds invest in equity certificates which allow the Funds to participate in the appreciation (depreciation) of the underlying security without actually owning the underlying security. These instruments are purchased pursuant to an agreement with a financial institution and are valued at a calculated market price based on the value of the underlying security in accordance with the agreement. At December 31, 2005, the Driehaus International Discovery Fund and the Driehaus Emerging Markets Growth Fund had unrealized appreciation of $4,497,106 and $2,985,686, respectively, as a result of their investment in these financial instruments. The aggregate market values of these certificates for the Driehaus International Discovery Fund and the Driehaus Emerging Markets Growth Fund represented 3.0% and 4.9%, respectively, of their total market values at December 31, 2005.

At December 31, 2005, the Funds had foreign currency forward contracts outstanding under which they are obligated to exchange currencies at specified future dates. At December 31, 2005, the Funds’ currency transactions are limited to transaction hedges.

Driehaus Mutual Funds

Notes to Financial Statements — (Continued)

The contractual amounts of foreign currency forward contracts do not necessarily represent the amounts potentially subject to risk. The measurement of the risks associated with these instruments is meaningful only when all related and offsetting transactions are considered. Risks arise from the possible inability of counter parties to meet the terms of their contracts and from movements in currency values.

The Funds had the following outstanding contracts at December 31, 2005:

Driehaus International Discovery Fund
Transaction Hedges:

Foreign Currency Purchased:


							Unrealized
							Appreciation
US Dollars					Settlement		(Depreciation)
Sold		Foreign Currency Purchased			Date		at December 31, 2005


$	604,306		824,316	Australian Dollar		January 2006	$	1,814
	968,723		2,265,165	Brazilian Real		January 2006		(2,617	)
	2,673,184		1,553,735	British Pound Sterling		January 2006		3,372
	529,638		615,678	Canadian Dollar		January 2006		1,929
	639,922		4,961,734	Hong Kong Dollar		January 2006		(51	)
	4,522,410		533,350,455	Japanese Yen		January 2006		(4,952	)
	1,330,300		8,978,594	Norwegian Krone		January 2006		729
	1,508,984		2,508,912	Singapore Dollar		January 2006		272
	830,524		1,091,350	Swiss Franc		January 2006		789

							$	1,285

Foreign Currency Sold:


							Unrealized
							Appreciation
US Dollars					Settlement		(Depreciation)
Purchased		Foreign Currency Sold			Date		at December 31, 2005


$	7,144,609		842,599,475	Japanese Yen		January 2006	$	29,016
	2,160,214		1,824,668	Euro		January 2006		(2,800	)
	1,814,465		3,016,820	Singapore Dollar		January 2006		(1,637	)

							$	24,579

				Net unrealized appreciation			$	25,864

Driehaus Emerging Markets Growth Fund
Transaction Hedges:

Foreign Currency Purchased:


							Unrealized
							Appreciation
US Dollars					Settlement		(Depreciation)
Sold		Foreign Currency Purchased			Date		at December 31, 2005


$	587,315		1,373,318	Brazilian Real		January 2006	$	(1,587	)
	248,217		144,271	British Pound Sterling		January 2006		723
	474,404		3,001,789	South African Rand		January 2006		1,420
	1,082,490		1,094,234,610	South Korean Won		January 2006		(6,843	)
	482,190		19,781,844	Thai Baht		January 2006		(294	)

							$	(6,581	)

Driehaus Mutual Funds

Notes to Financial Statements — (Continued)

Driehaus Emerging Markets Growth Fund — (Continued)
Foreign Currency Sold:


							Unrealized
							Appreciation
US Dollars					Settlement		(Depreciation)
Purchased		Foreign Currency Sold			Date		at December 31, 2005


$	305,434		714,197	Brazilian Real		January 2006	$	2,705
	471,056		3,652,400	Hong Kong Dollar		January 2006		36
	1,782,067		94,503,034	Philippine Peso		January 2006		9,120
	146,366		147,923,852	South Korean Won		January 2006		706

							$	12,567

				Net unrealized appreciation			$	5,986


D.	INVESTMENT TRANSACTIONS

The aggregate purchases and sales of investment securities, other than short-term obligations, for the year ended December 31, 2005, were as follows:


Fund	Purchases		Sales


Driehaus International Discovery Fund	$	763,864,556	$	683,103,032
Driehaus Emerging Markets Growth Fund		559,167,172		525,897,436


E.	RESTRICTED SECURITIES

Restricted securities are securities that are not registered for sale under the Securities Act of 1933 or applicable foreign law and that may be re-sold only in transactions exempt from applicable registration. Restricted securities include Rule 144A securities which may be sold normally to qualified institutional buyers. At December 31, 2005, the Funds held no restricted securities, other than equity certificates. Since an investment in equity certificates represents an agreement entered into with a financial institution, with terms set by such financial institution, these instruments are also deemed to be restricted (see Note C).


F.	LINE OF CREDIT

The Funds have a $50 million line of credit consisting of a $25 million committed line and a $25 million uncommitted line. This line of credit is available primarily to meet large, unexpected shareholder withdrawals subject to certain restrictions. The Funds have agreed to pay commitment fees computed at a rate of 0.125% per annum on the average daily amount of the available committed line. Interest is charged at a rate per annum equal to the Federal Funds Rate in effect at the time of borrowings plus 1%. At December 31, 2005, the Funds had no outstanding borrowings under the line of credit.


G.	OFF BALANCE SHEET RISKS

The Funds’ investments in foreign securities may entail risks due to the potential for political and economic instability in the countries where the issuers of these securities are located. In addition, foreign exchange fluctuations could affect the value of positions held. These risks are generally intensified in emerging markets.


H.	REDEMPTION FEES

The Funds may charge a redemption fee of 2.00% of the redemption amount for shares redeemed within 60 days of purchase. This redemption fee became effective for shares purchased after July 31, 2000. The redemption fees are recorded in paid-in capital.


I.	SUBSEQUENT EVENTS

As of January 1, 2006, Driehaus Capital Management, Inc. and Driehaus Securities Corporation each merged with and changed their names to Driehaus Capital Management LLC and Driehaus Securities LLC, respectively. This is only a change in legal structure and there is no change in control or business operations of the companies.

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Trustees of the Driehaus Mutual Funds:

We have audited the accompanying statements of assets and liabilities of the Driehaus Mutual Funds (comprising the Driehaus International Discovery Fund and the Driehaus Emerging Markets Growth Fund) (the “Funds”), including the schedules of investments, as of December 31, 2005, and the related statements 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 four years in the period then ended. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The financial highlights for the year ended December 31, 2001 were audited by other auditors who have ceased operations. Those auditors expressed an unqualified opinion on those financial highlights in their report dated February 8, 2002.

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 Funds’ 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 Funds’ 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 December 31, 2005, by correspondence with the custodian and brokers. 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 each of the respective Funds constituting the Driehaus Mutual Funds at December 31, 2005, the results of their operations for the year then ended, the changes in their net assets for each of the two years in the period then ended and the financial highlights for each of the four years in the period then ended, in conformity with U.S. generally accepted accounting principles.

Chicago, Illinois

February 15, 2006

Interested and Independent Trustees of the Trust

The following table sets forth certain information with respect to the Trustees of the Trust:


				Number of
		Term of		Portfolios in
		Office and		the Fund	Other
	Position(s)	Length of	Principal	Complex	Directorships
Name, Address and	Held with	Time	Occupations(s)	Overseen by	Held by
Date of Birth	the Trust	Served**	During Past 5 Years	Trustee	Trustee

Interested Trustee:*
Richard H. Driehaus 25 East Erie Street Chicago, IL 60611 DOB: 07/1942	Trustee and President	Since 1996	Chairman of the Board of the Adviser and the Distributor; Chief Executive Officer of Driehaus Capital Management (USVI) LLC (“USVI”); Chief Investment Officer and Portfolio Manager of the Adviser and USVI.	2	Driehaus Enterprise Management, Inc.; Vintage Properties, Inc.; Davies 53 Limited; The Richard H. Driehaus Foundation; and The Richard H. Driehaus Museum
Independent Trustees:
A.R. Umans c/o Driehaus Capital Management LLC 25 East Erie Street Chicago, IL 60611 DOB: 03/1927	Trustee and Chairman	Since 1996 Since 2005	Chairman of the Board, Commerce National Group (investment co.) since 2005; Chairman of the Board and Chief Executive Officer, RHC/Spacemaster Corporation (manufacturing) prior thereto.	2	None

Francis J. Harmon c/o Driehaus Capital Management LLC 25 East Erie Street Chicago, IL 60611 DOB: 11/1942	Trustee	Since 1998	Principal Account Executive — Labor Affairs, Blue Cross and Blue Shield of Illinois.	2	None

Daniel F. Zemanek c/o Driehaus Capital Management LLC 25 East Erie Street Chicago, IL 60611 DOB: 05/1942	Trustee	Since 1996	Senior Vice President of Sunrise Development, Inc. since January 2003; Consultant, real-estate development, August 1998 to January 2003.	2	None

* Mr. Driehaus is an “interested person” of the Trust, the Adviser and the Distributor, as defined in the Investment Company act of 1940, because he is an officer of the Adviser and the Distributor. In addition, Mr. Driehaus controls the Adviser and the Distributor.

** Each Trustee will serve as a Trustee of the Trust until (i) termination of the Trust, or (ii) until the Trustee’s retirement, resignation or death, or (iii) as otherwise specified in the Trust’s governing documents.

Officers of the Trust

The following table sets forth certain information with respect to the advisory board member and officers of the Trust:


		Term of
		Office and
	Position(s)	Length of	Principal
Name, Address and	Held with	Time	Occupations(s)
Date of Birth	the Trust	Served	During Past 5 Years

Arthur B. Mellin¹190 South LaSalle Street Chicago, IL 60603 DOB: 11/1942	Advisory Board Member	Since 1998	President of Mellin Securities Incorporated and Mellin Asset Management, Inc.

John E. Angley 25 East Erie Street Chicago, IL 60611 DOB: 07/1949	Vice President	Since 2004²	Director of Sales of the Adviser since 1999; President and Chief Operating Officer of Kemper Asset Management, Inc., prior thereto.

Michelle L. Cahoon 25 East Erie Street Chicago, IL 60611 DOB: 07/1966	Treasurer	Since 2002²	Vice President, Treasurer and Chief Financial Officer of the Adviser and Distributor since 2004; Vice President and Controller of the Adviser since 2003; Vice President, Treasurer and Controller of the Distributor since 2003; Controller of the Adviser and the Distributor since 2002; Manager with Arthur Andersen LLP from 1992-2002.

Joseph D. McDermott 25 East Erie Street Chicago, IL 60611 DOB: 10/1968	Chief Compliance Officer	Since 2004²	Chief Compliance Officer of the Adviser and Distributor and Chief Compliance Officer of Driehaus Capital Management (USVI) LLC since 2004; Director of Compliance of the Adviser and Distributor from 2000-2003.

Tina M. Payne 301 Bellevue Parkway Wilmington, DE 19809 DOB: 05/1974	Secretary	Since 2005²	Vice President and Associate Counsel, PFPC Inc. (financial services company) since 2003; Associate, Stradley, Ronon, Stevens & Young, LLC (law firm) from 2001-2003.

Kelly C. Dehler 25 East Erie Street Chicago, IL 60611 DOB: 10/1961	Assistant Secretary	Since 2004²	Attorney with the Adviser since 2004; Regulatory Compliance Officer Allstate Financial Services, L.L.C. (retail broker dealer) from 2003-2004; Assistant Secretary and Regulatory Associate of the Adviser from 2002-2003; Senior Paralegal with the Adviser from 2000-2002.

Candace A. Croal 301 Bellevue Parkway Wilmington, DE 19809 DOB: 06/1975	Assistant Secretary	Since 2005²	Senior Regulatory Administrator, PFPC Inc. (financial services company) since 2002; Senior Paralegal, Morgan Lewis & Bockius, L.L.P. (law firm) from 1999-2002.

¹ Mr. Driehaus and Mr. Mellin are brothers-in-law.

² Officers of the Trust are elected annually.

The Statement of Additional Information for the Driehaus Mutual Funds contains more detail about the Trust’s trustees and officers and is available upon request, without charge. For further information, please call 1-800-560-6111.

Fund Expense Examples

As a mutual fund shareholder, you may incur two types of costs: (1) transaction costs, including sales charges; redemption fees; and exchange fees and (2) ongoing costs, including management fees; distribution (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in each 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 six months ended December 31, 2005.

Actual Expenses

The first line of the tables below (“Actual”) 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 expense 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 tables below (“Hypothetical”) 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. You may use this information to compare the ongoing costs of investing in the Funds versus 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, redemption fees or exchange 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.

Driehaus International Discovery Fund




					Expenses Paid During
	Beginning Account		Ending Account Value		Six Months Ending
	July 1, 2005		December 31, 2005		December 31, 2005*


Actual	$	1,000	$	1,337.90	$	10.43

Hypothetical (5% return before expenses)	$	1,000	$	1,016.28	$	9.00

Driehaus Emerging Markets Growth Fund




					Expenses Paid During
	Beginning Account		Ending Account Value		Six Months Ending
	July 1, 2005		December 31, 2005		December 31, 2005*


Actual	$	1,000	$	1,368.12	$	11.88

Hypothetical (5% return before expenses)	$	1,000	$	1,015.17	$	10.11

* Expenses are equal to the Fund’s annualized expense ratio for the six-month period in the table below multiplied by the average account value over the period, multiplied by the number of days in the most recent fiscal half-year (184), then divided by 365 to reflect the half-year period.


Driehaus International Discovery Fund	1.77	%
Driehaus Emerging Markets Growth Fund	1.99	%

Shareholder Information

TAX INFORMATION (UNAUDITED) FOR THE YEAR ENDED DECEMBER 31, 2005

We are providing this information as required by the Internal Revenue Code. The amounts shown may differ from those elsewhere in this report because of differences between tax and financial reporting requirements.

The Funds’ distributions included capital gain amounts as follows:


	Driehaus		Driehaus
	International		Emerging Markets
	Discovery Fund		Growth Fund

Total long-term gains 20% rate gains	$	12,786,172	$	10,614,120

For taxable non-corporate shareholders, the following percentages of income and short-term capital gains represent qualified dividend income subject to the 15% rate category:


Driehaus		Driehaus
International		Emerging Markets
Discovery Fund		Growth Fund

	8.63%		8.45%

For corporate shareholders, the following percentages of income and short-term capital gains qualified for the dividends-received deduction:


Driehaus		Driehaus
International		Emerging Markets
Discovery Fund		Growth Fund

	0%		0%

PROXY VOTING POLICIES AND PROCEDURES AND PROXY VOTING RECORD

A description of the Funds’ policies and procedures with respect to the voting of proxies relating to the Funds’ portfolio securities is available without charge, upon request, by calling 1-800-560-6111. This information is also available on the Funds’ website at http://www.driehaus.com.

Information regarding how the Funds voted proxies related to portfolio securities during the 12-month period ended June 30, 2005 is available without charge, upon request, by calling 1-800-560-6111. This information is also available on the Securities and Exchange Commission’s (“SEC”) website at http://www.sec.gov.

HOW TO OBTAIN QUARTERLY PORTFOLIO HOLDINGS

Each Fund files a complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Funds’ Form N-Q is available electronically on the SEC’s website at http://www.sec.gov; hard copies may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC 20549. For more information on the Public Reference Room, call 1-800-SEC-0330. Each Fund’s complete schedule of portfolio holdings is also available on the Funds’ website at http://www.driehaus.com.

Board Considerations In Connection with the Annual Review of the

Investment Advisory Agreement

The Board of Trustees approved the renewal of the investment advisory agreement (the “Agreement”) with Driehaus Capital Management, Inc. (the “Adviser”) for Driehaus Emerging Markets Growth Fund (“DEMG”) and Driehaus International Discovery Fund (“DIDF”) in September 2005. As part of its review process, the Board requested and evaluated all information it deemed reasonably necessary to evaluate the Agreement. The Board reviewed comprehensive materials received from the Adviser, including data prepared by independent third parties, and independent legal counsel. The Board also received extensive information throughout the year regarding performance and operating results of each Fund. After their review of the information received, the Independent Trustees presented their findings and their recommendation to renew the Agreement to the full Board.

In connection with the contract review process, the Board considered the factors discussed below, among others. The Board also considered that the Adviser has managed each Fund since its inception, and the Board believes that a long-term relationship with a capable, conscientious adviser is in the best interests of each Fund. The Board considered, generally, that shareholders invested in each Fund, knowing that the Adviser managed the Fund and knowing the investment advisory fee schedule.

Nature, Quality and Extent of Services. The Board considered the nature, extent and quality of services provided under the Agreement, including portfolio management services and administrative services. The Board considered the experience and skills of senior management and investment personnel, the resources made available to such personnel, the ability of the Adviser to attract and retain high-quality personnel, and the organizational depth of the Adviser. The Board also considered compliance with legal and regulatory requirements, as well as the Adviser’s handling of portfolio brokerage, including its processes for seeking and measuring whether the Funds were obtaining best execution. The Board reviewed each Fund’s performance on a gross and net return basis over one-year, three-year and five-year periods ended June 30, 2005 and July 31, 2005, as well as over rolling periods since inception of each Fund. The Board also received and reviewed updated performance information through September 16, 2005. The Board noted that the Adviser represented that because its aggressive growth investment style resulted in performance volatility over shorter time periods, it was meaningful to analyze performance over rolling time periods to show the consistent out-performance to their benchmark indices over the life of the Funds. The Board compared short-term and long-term returns to various agreed-upon performance measures, including market indices and peer groups. The Board considered whether investment results were consistent with each Fund’s investment objective and policies.

On the basis of this evaluation and its ongoing review of investment results, the Board concluded that the nature, quality and extent of services provided by the Adviser historically have been and continue to be satisfactory. The Board noted that the Funds’ gross and net performance for the three and five-year periods, as compared to their respective peer groups (from data compiled from Morningstar Inc. and Lipper Inc., independent providers of mutual fund data), and the Funds’ net performance as compared to their benchmark indices, was satisfactory. The Board noted that DEMG’s gross and net performance for the year-to-date and one-year periods as compared to both peer groups and its benchmarks was below expectations, but the Board took into account the factors contributing to DEMG’s recent under-performance, including the fact that its peer groups include all styles of funds, and noted its favorable longer-term and rolling year performance. The Board noted that DIDF’s gross and net performance for the year-to-date and one-year periods as compared to both peer groups and its benchmarks was good.

Fees and Expenses. The Board considered each Fund’s advisory fee rates, operating expenses and total expense ratio, and compared them to fees and expenses of peer groups based on data compiled from Lipper as of June 30, 2005 (which includes data as of earlier period-ends). The information provided to the Board showed that each Fund’s advisory fee rate ranked high as compared to its total peer group. However, because of the Funds’ fee structure, total expense ratios were comparatively much lower, with DEMG’s total expense ratio slightly above the median of its peer group and with DIDF’s total expense ratio slightly below the median of its total peer group. When total expenses were compared to smaller-sized funds, both Funds had total expense ratios below the median, based upon Lipper information. The Board also considered each Fund’s advisory fee rates as compared to fees charged by the Adviser for similarly managed institutional accounts. With respect to institutional accounts, the Board noted that (i) both the mix of services provided and the level of responsibility required under the Agreement were significantly greater as compared to the Adviser’s obligations for similarly managed institutional accounts; and (ii) the advisory fees of institutional accounts are less relevant to the

Board’s consideration because they reflect significantly different competitive forces than those in the mutual fund marketplace. In considering the reasonableness of the expense ratio, the Board took into account the Adviser’s aggressive growth style, which resulted in high portfolio turnover, and relatively small amount of assets under management. The Board also noted that the Adviser’s directed brokerage program had resulted in reducing expenses of the Funds.

On the basis of the information provided, the Board concluded that the advisory fee schedule was reasonable and appropriate in light of the quality of services provided by the Adviser.

Profitability. The Board reviewed information regarding revenues received by the Adviser under the Agreement. The Board considered the estimated costs to the Adviser of managing the Funds. The Board reviewed the Adviser’s methodology in allocating its costs to the management of the Funds. The Board noted the inherently subjective nature of any allocation methodology, but concluded that the methodology presented was not unreasonable. The Board noted that, based on the information provided, the Adviser anticipates moderate profit from providing services to the Funds.

Economies of Scale. The Board considered whether there are economies of scale with respect to the management of the Funds and whether the Funds benefit from any economies of scale. The Board considered whether the advisory fee rate under the Agreement is reasonable in relation to the asset size of each Fund and whether any economies of scale should result in a reduction in the fee schedule. The Board accepted the Adviser’s conclusion that it has not yet experienced any economies of scale in connection with its services to the Funds.

Other Benefits to the Adviser and its Affiliates. The Board also considered the character and amount of other incidental benefits received by the Adviser and its affiliates, including fees received by an affiliate of the Adviser for brokerage services. The Board also considered benefits to the Adviser related to soft dollar allocations. The Board concluded that advisory fees were reasonable in light of these fall-out benefits.

Based on all of the information considered and the conclusions reached, the Board determined that the terms of the Agreement continue to be fair and reasonable and that the continuation of the Agreement is in the best interests of each Fund. No single factor was determinative in the Board’s analysis.

Item 2. Code of Ethics.

	(a)		The registrant, as of the end of the period covered by this report, has adopted a code of ethics that applies to the registrant’s 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 registrant or a third party.

	(b)		No response required.

	(c)		None.

	(d)		None.

	(e)		Not applicable

	(f)		The registrant’s Code of Ethics for Principal Executive and Principal Financial Officers was filed as Exhibit 10(a)(1) to the registrant’s Certified Shareholder Report on Form N-CSR, File No. 811-07655, on March 8, 2004, and is incorporated herein by reference.

Item 3. Audit Committee Financial Expert.

The registrant’s Board of Trustees has designated A.R. Umans as an audit committee financial expert. Mr. Umans is “independent,” as defined by this Item 3.

Item 4. Principal Accountant Fees and Services.

(a) Audit Fees

For the fiscal years ended December 31, 2005 and 2004, Ernst & Young LLP, the registrant’s principal accountant (“E&Y”), billed the registrant $54,000 and $50,000, respectively, for professional services rendered for the audit of the registrant’s annual financial statements or services that are normally provided in connection with statutory and regulatory filings.

(b) Audit-Related Fees

For the fiscal years ended December 31, 2005 and 2004, E&Y billed the registrant $0 and $0, respectively, for assurance and related services that are reasonably related to the performance of the audit of the registrant’s financial statements and that are not reported above.

For engagements that Driehaus Capital Management, Inc., the registrant’s investment adviser (“DCM”), or Driehaus Securities Corporation, the registrant’s distributor (“DSC”), entered into with E&Y for fiscal years 2005 and 2004, E&Y provided no audit-related services to DCM or DSC that were for engagements directly related to the registrant’s operations and financial reporting.

For the fiscal years ended December 31, 2005 and 2004, E&Y billed the registrant $8,400 and $7,800, respectively, for professional services rendered for tax compliance, tax advice and tax planning. Such services consisted of review of the registrant’s income tax returns and tax distribution requirements. The Audit Committee pre-approved all tax services that E&Y provided to the registrant.

For fiscal years 2005 and 2004, E&Y provided no tax services to DCM or DSC that were for engagements directly related to the registrant’s operations and financial reporting.

(d) All Other Fees

For the fiscal years ended December 31, 2005 and 2004, E&Y billed the registrant $0 and $0, respectively, for products and services provided, other than the services reported above.

For fiscal years 2005 and 2004, E&Y provided no other services to DCM or DSC that were for engagements directly related to the registrant’s operations and financial reporting.

(e)(1) Audit Committee Pre-Approval Policies and Procedures

Pursuant to registrant’s Audit Committee Charter (the “Charter”), the Audit Committee is responsible for pre-approving any engagement of the principal accountant to provide non-prohibited services to the registrant, including the fees and other compensation to be paid to the principal accountant, to the extent required by Rule 2-01(c)(7) of Regulation S-X. The Chairman of the Audit Committee may grant pre-approval for engagements of $5,000 or less. All such delegated pre-approvals will be presented to the Audit Committee no later than the next Audit Committee meeting.

Pursuant to the Charter, the Audit Committee is also responsible for pre-approving any engagement of the principal accountant, including the fees and other compensation to be paid to the principal accountant, to provide non-audit services to the registrant’s investment adviser (or any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant), if the engagement relates directly to the operations and financial reporting of the registrant, to the extent required by Rule 2-01(c)(7) of Regulation S-X. The Chairman of the Audit Committee may grant pre-approval for engagements of $5,000 or less. All such delegated pre-approvals will be presented to the Audit Committee no later than the next Audit Committee meeting.

(e)(2) The percentage of services described in each of paragraphs (b) through (d) of this Item that were approved by the Audit Committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X is 100%.

(f) Not applicable.

(g) Non-Audit Fees

For the fiscal years ended December 31, 2005 and 2004, E&Y billed the registrant $8,400 and $7,800, respectively, in aggregate non-audit fees. For the fiscal years ended December 31, 2005 and 2004, E&Y billed DCM or DSC $0 and $11,730, respectively, in aggregate non-audit fees.

(h) The registrant’s Audit Committee has considered whether the provision of non-audit services that were rendered to DCM or DSC that were not pre-approved pursuant to Rule 2-01(c)(7)(ii) of Regulation S-X is compatible with maintaining E&Y’s independence.

Item 5. Audit Committee of Listed Registrants.

Not applicable.

Item 6. Schedule of Investments.

Schedule of Investments in securities of unaffiliated issuers as of the close of the reporting period is included as part of the Report to Shareholders filed under Item 1 of this form.

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.

There have been no material changes to the procedures by which the shareholders may recommend nominees to the registrant’s board of directors, where those changes were implemented after the registrant last provided disclosure in response to the requirements of Item 7(d)(2)(ii)(G) of Schedule 14A (17 CFR 240.14a-101), or this Item.

Item 11. Controls and Procedures.

(a)

The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of the report that includes the disclosure required by this paragraph, based on their evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or 240.15d-15(b)).

(b)

There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d)) that occurred during the registrant’s 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.


		(a)(1)		Code of ethics, that is the subject of disclosure required by Item 2, filed as Exhibit 10(a)(1) to the Registrant’s Form N-CSR, filed on March 8, 2004 (Accession No. 0000950137-04-001539).

		(a)(2)		Certifications pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto.

		(a)(3)		Not applicable.

		(b)		Certifications pursuant to Rule 30a-2(b) under the 1940 Act and Section 906 of the Sarbanes-Oxley Act of 2002 are attached hereto.

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) Driehaus Mutual Funds

By (Signature and Title)*          /s/ Richard H. Driehaus
                                                       Richard H. Driehaus, President
                                                       (principal executive officer)

Date March 3, 2006

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Date March 3, 2006

By (Signature and Title)*           /s/ Michelle L. Cahoon
                                                       Michelle L. Cahoon, Treasurer
                                                       (principal financial officer)

Date March 3, 2006

^* Print the name and title of each signing officer under his or her signature.


	Investment Philosophy:

	The Adviser seeks to achieve superior investment returns primarily by investing in companies outside the U.S. that are currently demonstrating rapid growth in their sales and earnings and which, in our judgement, have the ability to continue or accelerate their growth rates in the future. The Adviser manages the portfolios actively (above average turnover) to insure that the Funds are fully invested, under appropriate market conditions, in companies that meet these criteria. Investors should note that investments in overseas markets can pose more risks than U.S. investments, and the Funds’ share prices are expected to be more volatile than those of U.S.-only funds. In addition, the Funds’ returns will fluctuate with changes in stock market conditions, currency values, interest rates, foreign government regulations, and economic and political conditions in countries in which the Funds invest. These risks are generally greater when investing in emerging markets.


¹	During these periods, the fund’s returns reflect fee waivers and/or reimbursements without which performance would have been lower.


*	All percentages are stated as a percent of net assets at December 31, 2005.


¹	The returns for the periods prior to July 1, 2003, reflect fee waivers and/or reimbursements without which performance would have been lower.

²	The Morgan Stanley Capital International Europe, Australasia and Far East Growth Index (MSCI EAFE^® Growth Index) is a subset of the MSCI EAFE^® Index (a market capitalization-weighted index designed to measure equity performance in 21 developed markets, excluding the U.S. and Canada) and includes only the MSCI EAFE^® Index stocks which are categorized as growth stocks. Data is in U.S. dollars. Source: Morgan Stanley Capital International Inc.

³	The Morgan Stanley Capital International All Country World ex USA Index (MSCI AC World ex USA Index) is a market capitalization-weighted index designed to measure equity market performance in 48 global developed and emerging markets, excluding the U.S. Data is in U.S. dollars. Source: Morgan Stanley Capital International Inc.

⁴	The Morgan Stanley Capital International All Country World ex USA Growth Index (MSCI AC World ex USA Growth Index) was added as a benchmark because the index includes certain emerging markets countries in which the Fund may invest and which are not included in the MSCI EAFE^® Growth Index. The index is a subset of the MSCI AC World ex USA Index and is composed only of the MSCI AC World ex USA Index stocks which are categorized as growth stocks. Data is in U.S. dollars. Source: Morgan Stanley Capital International Inc.


**	Non-income producing security

†	Restricted security — Investments in securities not registered under the Securities Act of 1933, excluding 144A securities. At December 31, 2005, the value of these restricted securities amounted to $16,999,954 or 2.8% of net assets.


#	This security has been halted from trading since January 24, 2005 and is being valued at a fair value as determined in good faith by or under the direction of the Driehaus Mutual Funds’ Board of Trustees.


~	Amount represents less than $0.01 per share

†	Such ratios are after administrative agent and transfer agent waivers and Adviser expense reimbursements, when applicable. PFPC Inc., the administrative agent and transfer agent, waived a portion of its fees from December 31, 1998 through December 31, 2001. The Adviser agreed to absorb other operating expenses to the extent necessary to ensure that the total Fund operating expenses (other than interest, taxes, brokerage commissions and other portfolio transaction expenses, capital expenditures, and extraordinary expenses) would not exceed the Fund’s operating expense cap for the first fifty-four months of its operations. For the period June 1, 1999 through June 30, 2002, the operating expense cap was 2.40% of average net assets. For the period July 1, 2002 through June 30, 2003, the Fund was reimbursed for expenses exceeding the 2.40% expense cap after reduction of amounts received through commission recapture programs that were applied to Fund expenses.

#	Such ratios are net of fees paid indirectly (see Note B in the Notes to Financial Statements).


*	Mr. Driehaus is an “interested person” of the Trust, the Adviser and the Distributor, as defined in the Investment Company act of 1940, because he is an officer of the Adviser and the Distributor. In addition, Mr. Driehaus controls the Adviser and the Distributor.

**	Each Trustee will serve as a Trustee of the Trust until (i) termination of the Trust, or (ii) until the Trustee’s retirement, resignation or death, or (iii) as otherwise specified in the Trust’s governing documents.


¹	Mr. Driehaus and Mr. Mellin are brothers-in-law.

²	Officers of the Trust are elected annually.


*	Expenses are equal to the Fund’s annualized expense ratio for the six-month period in the table below multiplied by the average account value over the period, multiplied by the number of days in the most recent fiscal half-year (184), then divided by 365 to reflect the half-year period.