N-CSR 1 a2149416zn-csr.txt N-CSR 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 No. 811-07909 --------------------------------------------------- CREDIT SUISSE SMALL CAP GROWTH FUND, INC. --------------------------------------------------- (Exact Name of Registrant as Specified in Charter) 466 Lexington Avenue, New York, New York 10017-3140 --------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) J. Kevin Gao, Esq. Credit Suisse Small Cap Growth Fund, Inc. 466 Lexington Avenue New York, New York 10017-3140 Registrant's telephone number, including area code: (212) 875-3500 Date of fiscal year end: October 31 Date of reporting period: November 1, 2003 to October 31, 2004 ITEM 1. REPORTS TO STOCKHOLDERS. [CREDIT SUISSE ASSET MANAGEMENT LOGO] CREDIT SUISSE FUNDS ANNUAL REPORT OCTOBER 31, 2004 - CREDIT SUISSE CAPITAL APPRECIATION FUND - CREDIT SUISSE MID-CAP GROWTH FUND - CREDIT SUISSE SMALL CAP GROWTH FUND THE FUNDS' INVESTMENT OBJECTIVES, RISKS, CHARGES AND EXPENSES (WHICH SHOULD BE CONSIDERED CAREFULLY BEFORE INVESTING), AND MORE COMPLETE INFORMATION ABOUT THE THE FUNDS, ARE PROVIDED IN THE PROSPECTUS, WHICH SHOULD BE READ CAREFULLY BEFORE INVESTING. YOU MAY OBTAIN ADDITIONAL COPIES BY CALLING 800-927-2874 OR BY WRITING TO CREDIT SUISSE FUNDS, P.O. BOX 55030, BOSTON, MA 02205-5030. CREDIT SUISSE ASSET MANAGEMENT SECURITIES, INC., DISTRIBUTOR, IS LOCATED AT 466 LEXINGTON AVE., NEW YORK, NY 10017-3140. CREDIT SUISSE FUNDS ARE ADVISED BY CREDIT SUISSE ASSET MANAGEMENT, LLC. INVESTORS IN THE CREDIT SUISSE FUNDS SHOULD BE AWARE THAT THEY MAY BE ELIGIBLE TO PURCHASE COMMON CLASS AND/OR ADVISOR CLASS SHARES (WHERE OFFERED) DIRECTLY OR THROUGH CERTAIN INTERMEDIARIES. SUCH SHARES ARE NOT SUBJECT TO A SALES CHARGE BUT MAY BE SUBJECT TO AN ONGOING SERVICE AND DISTRIBUTION FEE OF UP TO 0.50% OF AVERAGE DAILY NET ASSETS. INVESTORS IN THE CREDIT SUISSE FUNDS SHOULD ALSO BE AWARE THAT THEY MAY BE ELIGIBLE FOR A REDUCTION OR WAIVER OF THE SALES CHARGE WITH RESPECT TO CLASS A, B OR C SHARES. FOR MORE INFORMATION, PLEASE REVIEW THE RELEVANT PROSPECTUSES OR CONSULT YOUR FINANCIAL REPRESENTATIVE. THE VIEWS OF THE FUNDS' MANAGEMENT ARE AS OF THE DATE OF THE LETTER AND FUND HOLDINGS DESCRIBED IN THIS DOCUMENT ARE AS OF OCTOBER 31, 2004; THESE VIEWS AND FUND HOLDINGS MAY HAVE CHANGED SUBSEQUENT TO THESE DATES. NOTHING IN THIS DOCUMENT IS A RECOMMENDATION TO PURCHASE OR SELL SECURITIES. FUND SHARES ARE NOT DEPOSITS OR OTHER OBLIGATIONS OF CREDIT SUISSE ASSET MANAGEMENT, LLC ("CSAM") OR ANY AFFILIATE, ARE NOT FDIC-INSURED AND ARE NOT GUARANTEED BY CSAM OR ANY AFFILIATE. FUND INVESTMENTS ARE SUBJECT TO INVESTMENT RISKS, INCLUDING LOSS OF YOUR INVESTMENT. CREDIT SUISSE CAPITAL APPRECIATION FUND ANNUAL INVESTMENT ADVISER'S REPORT October 31, 2004 (unaudited) November 24, 2004 Dear Shareholder: PERFORMANCE SUMMARY 11/01/03 - 10/31/04
SHARE CLASS/BENCHMARK PERFORMANCE Common 3.46% Advisor 2.88% Class A 3.13% Class B 2.42% Class C 2.35% Russell 1000(R) Growth Index(1) 3.38%
Performance for the Fund's Class A, Class B and Class C Shares is without the maximum sales charge of 5.75%, 4.00% and 1.00%, respectively.(2) MARKET OVERVIEW: STRONG START GIVES WAY TO SEESAW FINISH The US equity market began the period on a strong note. An improving outlook for the economy and corporate profits continued to help stocks regain their footing after 2000's "bubble burst." However, the market faced headwinds as 2004 progressed, mostly in the form of domestic and international political uncertainty, worries over rising interest rates and a surge in oil prices. The market hit its low for the reporting period in August, but then moved upward again as inflation and interest-rate fears subsided. Style category, more than market cap size, was the driving factor behind performance in the period. Growth stocks advanced, but lagged value stocks by a considerable margin, reflecting the outperformance of energy and industrial-type companies, which comprise a larger share of the value universe. Broadly, mid- and small-capitalization stocks outpaced large cap stocks, a trend often (but not always) seen in the early stages of economic recovery. STRATEGIC REVIEW: INTERNET EXPOSURE DELIVERS The Fund's Common Class shares modestly outperformed the benchmark, aided by good stock selection within the consumer discretionary sector, in particular internet companies such as Yahoo (2.8% of the Fund's portfolio as of October 31, 2004), which has benefited from a rising share of corporate advertising revenues, and Ebay (2.8% of the Fund's portfolio as of October 31, 2004), a pioneer in online retailing. Both are profitable internet companies with clearly defined business models -- which was not the case for many "dot com" companies when the internet bubble collapsed in 2000 -- profitably competing with more traditional companies. 1 In the industrial area, Tyco (2.9% of the Fund's portfolio as of October 31, 2004) was a standout, buoyed by new management's restructuring efforts. The Fund was also helped by its overweighting in energy through much of the period. On the negative side, the Fund's technology holdings detracted from its return, especially in the software area. GOING FORWARD: FOCUS ON COMPANY SELECTION, PRUDENT USE OF CASH We continue to look for companies we believe are focused on the intelligent use of capital, whether through strategic investments, share repurchase programs or higher dividend payouts. The economic recovery has resulted in large accumulated cash holdings within many companies, and how they deploy this cash will likely to prove critical to stock performance. Another theme is upgrading the portfolio's secular growth profile. This reflects our general view that secular growth stocks should outperform companies with cyclical business, such as semiconductor names whose cycles we believe are past a peak. Recent noteworthy additions to the Fund in this context were Whole Foods Market (1.2% of the Fund's portfolio as of October 31, 2004), an upscale grocer; Getty Images (1.0% of the Fund's portfolio as of October 31, 2004), a provider of e-commerce visual content to businesses worldwide; and McAfee (1.1% of the Fund's portfolio as of October 31, 2004), which offers computer security solutions with an emphasis on businesses' needs, but which is also entering the consumer market. Jeffrey T. Rose Marian U. Pardo Credit Suisse Asset Management, LLC (CSAM) IN ADDITION TO HISTORICAL INFORMATION, THIS REPORT CONTAINS FORWARD-LOOKING STATEMENTS, WHICH MAY CONCERN, AMONG OTHER THINGS, DOMESTIC AND FOREIGN MARKET, INDUSTRY AND ECONOMIC TRENDS AND DEVELOPMENTS AND GOVERNMENT REGULATION AND THEIR POTENTIAL IMPACT ON THE FUND'S INVESTMENT PORTFOLIO. THESE STATEMENTS ARE SUBJECT TO RISKS AND UNCERTAINTIES AND ACTUAL TRENDS, DEVELOPMENTS AND REGULATIONS IN THE FUTURE AND THEIR IMPACT ON THE FUND COULD BE MATERIALLY DIFFERENT FROM THAT PROJECTED, ANTICIPATED OR IMPLIED. THE FUND HAS NO OBLIGATION TO UPDATE OR REVISE FORWARD-LOOKING STATEMENTS. 2 [CHART] COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN THE CREDIT SUISSE CAPITAL APPRECIATION FUND COMMON CLASS SHARES, ADVISOR CLASS SHARES AND THE RUSSELL 1000(R) GROWTH INDEX(1) FOR TEN YEARS.
CREDIT SUISSE CAPITAL CREDIT SUISSE CAPITAL APPRECIATION FUND -- COMMON CLASS APPRECIATION FUND -- ADVISOR CLASS RUSSELL 1000 GROWTH INDEX(1) 10/31/1994 $ 10,000 $ 10,000 $ 10,000 11/30/1994 $ 9,566 $ 9,564 $ 9,680 12/31/1994 $ 9,557 $ 9,548 $ 9,843 1/31/1995 $ 9,512 $ 9,495 $ 10,052 2/28/1995 $ 9,980 $ 9,958 $ 10,473 3/31/1995 $ 10,463 $ 10,444 $ 10,780 4/30/1995 $ 10,637 $ 10,611 $ 11,015 5/31/1995 $ 10,871 $ 10,846 $ 11,400 6/30/1995 $ 11,360 $ 11,324 $ 11,840 7/31/1995 $ 11,966 $ 11,924 $ 12,332 8/31/1995 $ 12,094 $ 12,045 $ 12,345 9/30/1995 $ 12,374 $ 12,318 $ 12,914 10/31/1995 $ 12,405 $ 12,341 $ 12,923 11/30/1995 $ 12,957 $ 12,888 $ 13,426 12/31/1995 $ 13,199 $ 13,127 $ 13,503 1/31/1996 $ 13,647 $ 13,568 $ 13,954 2/29/1996 $ 14,017 $ 13,931 $ 14,209 3/31/1996 $ 14,293 $ 14,198 $ 14,228 4/30/1996 $ 14,465 $ 14,363 $ 14,602 5/31/1996 $ 14,741 $ 14,631 $ 15,112 6/30/1996 $ 14,560 $ 14,449 $ 15,133 7/31/1996 $ 13,914 $ 13,801 $ 14,246 8/31/1996 $ 14,439 $ 14,319 $ 14,614 9/30/1996 $ 15,344 $ 15,210 $ 15,678 10/31/1996 $ 15,465 $ 15,322 $ 15,772 11/30/1996 $ 16,412 $ 16,247 $ 16,957 12/31/1996 $ 16,270 $ 16,108 $ 16,625 1/31/1997 $ 16,894 $ 16,722 $ 17,791 2/28/1997 $ 17,038 $ 16,857 $ 17,670 3/31/1997 $ 16,404 $ 16,224 $ 16,714 4/30/1997 $ 17,163 $ 16,962 $ 17,824 5/31/1997 $ 18,085 $ 17,864 $ 19,110 6/30/1997 $ 18,757 $ 18,526 $ 19,875 7/31/1997 $ 20,467 $ 20,205 $ 21,633 8/31/1997 $ 19,593 $ 19,332 $ 20,366 9/30/1997 $ 20,899 $ 20,618 $ 21,369 10/31/1997 $ 20,256 $ 19,975 $ 20,579 11/30/1997 $ 20,803 $ 20,502 $ 21,453 12/31/1997 $ 21,376 $ 21,064 $ 21,693 1/31/1998 $ 21,259 $ 20,936 $ 22,342 2/28/1998 $ 22,628 $ 22,278 $ 24,022 3/31/1998 $ 23,763 $ 23,387 $ 24,980 4/30/1998 $ 24,313 $ 23,924 $ 25,326 5/31/1998 $ 23,728 $ 23,340 $ 24,607 6/30/1998 $ 24,980 $ 24,565 $ 26,114 7/31/1998 $ 25,050 $ 24,612 $ 25,941 8/31/1998 $ 20,686 $ 20,318 $ 22,047 9/30/1998 $ 22,137 $ 21,741 $ 23,741 10/31/1998 $ 22,839 $ 22,418 $ 25,649 11/30/1998 $ 24,325 $ 23,877 $ 27,601 12/31/1998 $ 26,884 $ 26,374 $ 30,091 1/31/1999 $ 28,572 $ 28,009 $ 31,858 2/28/1999 $ 27,434 $ 26,886 $ 30,403 3/31/1999 $ 28,816 $ 28,229 $ 32,004 4/30/1999 $ 29,098 $ 28,497 $ 32,045 5/31/1999 $ 28,327 $ 27,728 $ 31,060 6/30/1999 $ 30,113 $ 29,462 $ 33,235 7/31/1999 $ 29,660 $ 29,010 $ 32,179 8/31/1999 $ 29,660 $ 28,998 $ 32,705 9/30/1999 $ 29,978 $ 29,303 $ 32,018 10/31/1999 $ 31,581 $ 30,853 $ 34,436 11/30/1999 $ 33,611 $ 32,818 $ 36,294 12/31/1999 $ 39,856 $ 38,893 $ 40,069 1/31/2000 $ 38,634 $ 37,704 $ 38,190 2/29/2000 $ 44,000 $ 42,905 $ 40,057 3/31/2000 $ 45,467 $ 44,323 $ 42,924 4/30/2000 $ 41,649 $ 40,581 $ 40,881 5/31/2000 $ 39,517 $ 38,487 $ 38,822 6/30/2000 $ 42,465 $ 41,338 $ 41,764 7/31/2000 $ 42,234 $ 41,108 $ 40,023 8/31/2000 $ 46,255 $ 44,999 $ 43,647 9/30/2000 $ 43,524 $ 42,337 $ 39,518 10/31/2000 $ 41,527 $ 40,365 $ 37,649 11/30/2000 $ 37,044 $ 36,002 $ 32,099 12/31/2000 $ 37,767 $ 36,689 $ 31,085 1/31/2001 $ 37,767 $ 36,674 $ 33,233 2/28/2001 $ 34,078 $ 33,078 $ 27,590 3/31/2001 $ 31,571 $ 30,622 $ 24,588 4/30/2001 $ 34,222 $ 33,188 $ 27,699 5/31/2001 $ 33,743 $ 32,713 $ 27,292 6/30/2001 $ 32,513 $ 31,493 $ 26,658 7/31/2001 $ 30,884 $ 29,909 $ 25,992 8/31/2001 $ 28,409 $ 27,501 $ 23,866 9/30/2001 $ 24,960 $ 24,159 $ 21,484 10/31/2001 $ 25,918 $ 25,062 $ 22,611 11/30/2001 $ 28,345 $ 27,406 $ 24,784 12/31/2001 $ 28,571 $ 27,614 $ 24,738 1/31/2002 $ 27,437 $ 26,505 $ 24,301 2/28/2002 $ 26,031 $ 25,143 $ 23,292 3/31/2002 $ 26,702 $ 25,776 $ 24,098 4/30/2002 $ 24,594 $ 23,733 $ 22,132 5/31/2002 $ 23,987 $ 23,130 $ 21,596 6/30/2002 $ 21,528 $ 20,770 $ 19,599 7/31/2002 $ 20,107 $ 19,376 $ 18,521 8/31/2002 $ 20,154 $ 19,423 $ 18,576 9/30/2002 $ 18,541 $ 17,855 $ 16,650 10/31/2002 $ 20,011 $ 19,265 $ 18,177 11/30/2002 $ 20,777 $ 19,994 $ 19,164 12/31/2002 $ 19,404 $ 18,663 $ 17,839 1/31/2003 $ 19,164 $ 18,425 $ 17,406 2/28/2003 $ 19,021 $ 18,283 $ 17,326 3/31/2003 $ 19,116 $ 18,378 $ 17,648 4/30/2003 $ 20,330 $ 19,518 $ 18,952 5/31/2003 $ 21,352 $ 20,485 $ 19,898 6/30/2003 $ 21,927 $ 21,039 $ 20,173 7/31/2003 $ 22,678 $ 21,736 $ 20,675 8/31/2003 $ 22,885 $ 21,942 $ 21,190 9/30/2003 $ 22,278 $ 21,340 $ 20,963 10/31/2003 $ 23,556 $ 22,560 $ 22,141 11/30/2003 $ 23,844 $ 22,814 $ 22,374 12/31/2003 $ 24,450 $ 23,400 $ 23,148 1/31/2004 $ 24,882 $ 23,796 $ 23,620 2/29/2004 $ 25,137 $ 24,034 $ 23,771 3/31/2004 $ 24,738 $ 23,637 $ 23,329 4/30/2004 $ 24,466 $ 23,368 $ 23,058 5/31/2004 $ 25,057 $ 24,350 $ 23,781 7/31/2004 $ 24,099 $ 22,988 $ 22,437 8/31/2004 $ 23,460 $ 22,370 $ 22,327 9/30/2004 $ 24,195 $ 23,067 $ 22,539 10/31/2004 $ 24,371 $ 23,210 $ 22,891
[CHART] COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN THE CREDIT SUISSE CAPITAL APPRECIATION FUND CLASS A SHARES, B SHARES, C SHARES(2) AND THE RUSSELL 1000(R) GROWTH INDEX(1) FROM INCEPTION (11/30/01).
CREDIT SUISSE CAPITAL CREDIT SUISSE CAPITAL CREDIT SUISSE CAPITAL RUSSELL 1000 APPRECIATION FUND -- CLASS A(2) APPRECIATION FUND -- CLASS B(2) APPRECIATION FUND -- CLASS C(2) GROWTH INDEX(1) 11/30/2001 $ 9,425 $ 10,000 $ 10,000 $ 10,000 12/31/2001 $ 9,496 $ 10,068 $ 10,068 $ 9,981 1/31/2002 $ 9,119 $ 9,663 $ 9,663 $ 9,805 2/28/2002 $ 8,652 $ 9,161 $ 9,161 $ 9,398 3/31/2002 $ 8,869 $ 9,387 $ 9,387 $ 9,723 4/30/2002 $ 8,168 $ 8,637 $ 8,637 $ 8,930 5/31/2002 $ 7,961 $ 8,417 $ 8,417 $ 8,714 6/30/2002 $ 7,149 $ 7,555 $ 7,550 $ 7,908 7/31/2002 $ 6,676 $ 7,043 $ 7,043 $ 7,473 8/31/2002 $ 6,692 $ 7,060 $ 7,060 $ 7,495 9/30/2002 $ 6,150 $ 6,485 $ 6,485 $ 6,718 10/31/2002 $ 6,639 $ 6,992 $ 6,992 $ 7,334 11/30/2002 $ 6,894 $ 7,262 $ 7,257 $ 7,732 12/31/2002 $ 6,437 $ 6,772 $ 6,772 $ 7,198 1/31/2003 $ 6,352 $ 6,682 $ 6,682 $ 7,023 2/28/2003 $ 6,304 $ 6,626 $ 6,626 $ 6,991 3/31/2003 $ 6,336 $ 6,660 $ 6,654 $ 7,121 4/30/2003 $ 6,740 $ 7,071 $ 7,071 $ 7,647 5/31/2003 $ 7,074 $ 7,420 $ 7,415 $ 8,029 6/30/2003 $ 7,265 $ 7,617 $ 7,612 $ 8,139 7/31/2003 $ 7,510 $ 7,865 $ 7,865 $ 8,342 8/31/2003 $ 7,579 $ 7,939 $ 7,933 $ 8,550 9/30/2003 $ 7,377 $ 7,719 $ 7,713 $ 8,458 10/31/2003 $ 7,797 $ 8,153 $ 8,153 $ 8,934 11/30/2003 $ 7,887 $ 8,243 $ 8,243 $ 9,027 12/31/2003 $ 8,089 $ 8,451 $ 8,446 $ 9,340 1/31/2004 $ 8,232 $ 8,592 $ 8,586 $ 9,530 2/29/2004 $ 8,312 $ 8,665 $ 8,665 $ 9,591 3/31/2004 $ 8,179 $ 8,525 $ 8,525 $ 9,413 4/30/2004 $ 8,089 $ 8,423 $ 8,423 $ 9,304 5/31/2004 $ 8,280 $ 8,620 $ 8,615 $ 9,477 6/30/2004 $ 8,429 $ 8,767 $ 8,767 $ 9,595 7/31/2004 $ 7,961 $ 8,277 $ 8,271 $ 9,053 8/31/2004 $ 7,749 $ 8,051 $ 8,051 $ 9,009 9/30/2004 $ 7,988 $ 8,299 $ 8,299 $ 9,094 10/31/2004 $ 8,041 $ 8,350 $ 8,344 $ 9,236
3 AVERAGE ANNUAL RETURNS AS OF SEPTEMBER 30, 2004
SINCE 1 YEAR 5 YEARS 10 YEARS INCEPTION ----------- ----------- ----------- ----------- Common Class(3) 8.60% (4.20)% 9.37% 9.25% Advisor Class(3) 8.09% (4.67)% 8.85% 8.92% Class A Without Sales Charge 8.28% -- -- (5.67)% Class A With Maximum Sales Charge 2.04% -- -- (7.62)% Class B Without CDSC 7.52% -- -- (6.36)% Class B With CDSC 3.52% -- -- (7.03)% Class C Without CDSC 7.60% -- -- (6.36)% Class C With CDSC 6.60% -- -- (6.36)%
AVERAGE ANNUAL RETURNS AS OF OCTOBER 31, 2004
SINCE 1 YEAR 5 YEARS 10 YEARS INCEPTION ----------- ----------- ----------- ----------- Common Class(3) 3.46% (5.05)% 9.32% 9.25% Advisor Class(3) 2.88% (5.53)% 8.78% 8.91% Class A Without Sales Charge 3.13% -- -- (5.30)% Class A With Maximum Sales Charge (2.82)% -- -- (7.19)% Class B Without CDSC 2.42% -- -- (5.99)% Class B With CDSC (1.58)% -- -- (6.64)% Class C Without CDSC 2.35% -- -- (6.01)% Class C With CDSC 1.35% -- -- (6.01)%
RETURNS REPRESENT PAST PERFORMANCE AND INCLUDE CHANGE IN SHARE PRICE AND REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS. PAST PERFORMANCE CANNOT GUARANTEE FUTURE RESULTS. THE CURRENT PERFORMANCE OF THE FUND MAY BE LOWER OR HIGHER THAN THE FIGURES SHOWN. RETURNS AND SHARE PRICE WILL FLUCTUATE, AND REDEMPTION VALUE MAY BE LESS THAN ORIGINAL COST. THE PERFORMANCE RESULTS DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND SHARES. PERFORMANCE INFORMATION CURRENT TO THE MOST RECENT MONTH-END IS AVAILABLE AT www.csam.com/us. ---------- (1) The Russell 1000(R) Growth Index measures the performance of those companies in the Russell 1000(R) Index with higher price-to-book ratios and higher forecasted growth values. It is an unmanaged index of common stocks that includes reinvestment of dividends and is compiled by Frank Russell Company. Investors cannot invest directly in an index. (2) Total return for Class A Shares for the reporting period, based on offering price (with maximum sales charge of 5.75%), was down 2.82%. Total return for Class B Shares for the reporting period, based on redemption value (including maximum contingent deferred sales charge of 4%), was down 1.58%. Total return for Class C Shares for the reporting period, based on redemption value (including maximum contingent deferred sales charge of 1%), was 1.35%. (3) Inception Date: 8/17/87. 4 INFORMATION ABOUT YOUR FUND'S EXPENSES As an investor of the Fund, you incur two types of costs: ongoing expenses and transaction costs. Ongoing expenses include management fees, distribution and service (12b-1) fees and other Fund expenses. Examples of transaction costs include sales charges (loads), redemption fees and account maintenance fees, which are not shown in this section and which would result in higher total expenses. The following table is intended to help you understand your ongoing expenses of investing in the Fund and to help you compare these expenses with the ongoing expenses of investing in other mutual funds. The table is based on an investment of $ 1,000 made at the beginning of the six-month period ended October 31, 2004. The table illustrates your Fund's expenses in two ways: - ACTUAL FUND RETURN. This helps you estimate the actual dollar amount of ongoing expenses paid on a $ 1,000 investment in the Fund using the Fund's actual return during the period. To estimate the expenses 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 "Expenses Paid per $ 1,000" line under the share class you hold. - HYPOTHETICAL 5% FUND RETURN. This helps you to compare your Fund's ongoing expenses with those of other mutual funds using the Fund's actual expense ratio and a hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical fund return may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expense you paid for the period. Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. If these transaction costs had been included, your costs would have been higher. The "Expenses Paid per $ 1,000" line of the tables is useful in comparing ongoing expenses only and will not help you determine the relative total expenses of owning different funds. 5 EXPENSES AND VALUE OF A $1,000 INVESTMENT FOR THE SIX-MONTH PERIOD ENDED OCTOBER 31, 2004
COMMON ADVISOR CLASS CLASS CLASS A CLASS B CLASS C -------- -------- -------- -------- -------- ACTUAL FUND RETURN Beginning Account Value 4/30/04 $ 1,000 $ 1,000 $ 1,000 $ 1,000 $ 1,000 Ending Account Value 10/31/04 $ 996 $ 993 $ 994 $ 991 $ 991 Expenses Paid per $1,000* $ 5.82 $ 8.32 $ 7.07 $ 10.81 $ 10.81 HYPOTHETICAL 5% FUND RETURN Beginning Account Value 4/30/04 $ 1,000 $ 1,000 $ 1,000 $ 1,000 $ 1,000 Ending Account Value 10/31/04 $ 1,025 $ 1,025 $ 1,025 $ 1,025 $ 1,025 Expenses Paid per $1,000* $ 5.90 $ 8.45 $ 7.18 $ 10.99 $ 10.99 COMMON ADVISOR CLASS CLASS CLASS A CLASS B CLASS C -------- -------- -------- -------- -------- ANNUALIZED EXPENSE RATIOS* 1.16% 1.66% 1.41% 2.16% 2.16%
---------- * EXPENSES ARE EQUAL TO THE FUND'S ANNUALIZED EXPENSE RATIO FOR EACH SHARE CLASS, MULTIPLIED BY THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY THE NUMBER OF DAYS IN THE MOST RECENT FISCAL HALF YEAR PERIOD, THEN DIVIDED BY 366. THE "EXPENSES PAID PER $1,000" AND THE "ANNUALIZED EXPENSE RATIOS" IN THE TABLES ARE BASED ON ACTUAL EXPENSES PAID BY THE FUND DURING THE PERIOD, NET OF FEE WAIVERS AND/OR EXPENSE REIMBURSEMENTS. IF THOSE FEE WAIVERS AND/OR EXPENSE REIMBURSEMENTS HAD NOT BEEN IN EFFECT, THE FUND'S ACTUAL EXPENSES WOULD HAVE BEEN HIGHER. For more information, please refer to the Fund's prospectus. 6 SECTOR BREAKDOWN* Consumer Discretionary 25.2% Health Care 21.0% Technology 17.0% Financial Services 7.8% Producer Durables 7.3% Other 6.1% Materials & Processing 5.6% Other Energy 3.6% Other Assets 3.0% Consumer Staples 2.3% Auto & Transportation 1.1%
---------- * The Fund's sector breakdown is expressed as a percentage of total investments (excluding security lending collateral) and may vary over time. 7 CREDIT SUISSE MID-CAP GROWTH FUND ANNUAL INVESTMENT ADVISER'S REPORT October 31, 2004 (unaudited) November 24, 2004 Dear Shareholder: PERFORMANCE SUMMARY 11/01/03 - 10/31/04
SHARE CLASS/BENCHMARK PERFORMANCE Common(1) 4.67% Advisor(1) 4.14% Class A(1) 4.40% Class B(1) (5.02)%(5) Class C(1) (4.91)%(5) Russell 2500(TM) Growth Index(2) 6.14% Russell Midcap(R) Growth Index(3) 8.77%
Performance for the Fund's Class A, Class B and Class C shares is without the maximum sales charge of 5.75%, 4.00% and 1.00%, respectively.(4) MARKET OVERVIEW: STRONG START GIVES WAY TO SEESAW FINISH The US equity market began the period on a strong note. An improving outlook for the economy and corporate profits continued to help stocks regain their footing after 2000's "bubble burst." However, the market faced headwinds as 2004 progressed, mostly in the form of domestic and international political uncertainty, worries over rising interest rates and a surge in oil prices. The market hit its low for the reporting period in August, but then moved upward again as inflation and interest-rate fears subsided. Style category, as opposed to market cap size, was the driving factor behind performance in the period. While growth stocks had a positive showing for the 12 months, they lagged value stocks by a wide margin, reflecting the outperformance of energy and industrial-type companies, which comprise a larger share of the value universe. Broadly, mid- and small-capitalization stocks outpaced large cap stocks, a trend often (but not always) seen in the early stages of economic recovery. STRATEGIC REVIEW: TECHNOLOGY OUTPERFORMS WHILE CONSUMER, HEALTH CARE LAG The Fund had a gain but trailed its benchmarks. Stocks that hindered the Fund's relative performance included its consumer discretionary holdings. While collectively positive, they lagged in part due to a decline in Netflix (we decided to eliminate the position late in the period). The online DVD rental company's business model was a rapid success, drawing the attention of potential competitors, ultimately pressuring its stock price. The Fund's health 8 care stocks likewise advanced but underperformed. In addition, the Fund's semiconductor-equipment stocks fell amid a broad selloff in the group, hampering our performance in the producer durables sector. We selectively reduced our semiconductor exposure in the latter part of the period. On the positive side, stock selection in the technology sector was a contributor to relative performance. Noteworthy gainers here included Tessera Technologies (1.5% of the Fund's portfolio as of October 31, 2004), an intellectual property rights company catering to electronics chip makers; and Sina (0.8% of the Fund's portfolio as of October 31, 2004), a global internet portal company providing access to Chinese language sites. The Fund's overweighting in energy during much of the period was also beneficial. GOING FORWARD: FOCUS ON COMPANY SELECTION Stocks we added to the Fund recently include NCR (1.4% of the Fund's portfolio as of October 31, 2004), a manufacturer of ATM machines and cash registers. The company's growth should be supported in our view by new ATM unit sales across the country, as well as by an upgrade cycle of existing ATMs that could extend for three or more years. Another recent purchase was Macromedia (1.7% of the Fund's portfolio as of October 31, 2004), whose software products are used in the creation of interactive Web publishing. We see potential growth catalysts in the upgrade of its major product -- which accounts for about two-thirds of the company's revenues at present -- and a new product making inroads to the wireless telecommunications area. One noteworthy sale we made near the end of the period was Starbucks. After a period of strong performance that pushed the stock into large-cap territory, we eliminated the position and redeployed assets to more attractively priced stocks in the mid-cap area. Looking ahead, we expect that against a backdrop of modest economic growth and amid generally compressed stock valuations, individual company selection should prove critical to performance over the next year. We think the mid cap space offers compelling opportunities, given the number of relatively underfollowed companies that we believe nonetheless offer ample liquidity in the market. The Credit Suisse Mid-Cap Growth Team Marian U. Pardo Eric M. Wiegand Leo M. Bernstein Calvin E. Chung Credit Suisse Asset Management, LLC (CSAM) 9 INVESTMENTS IN SMALL TO MEDIUM-SIZED COMPANIES MAY BE MORE VOLATILE AND LESS LIQUID THAN INVESTMENTS IN LARGER COMPANIES. IN ADDITION TO HISTORICAL INFORMATION, THIS REPORT CONTAINS FORWARD-LOOKING STATEMENTS, WHICH MAY CONCERN, AMONG OTHER THINGS, DOMESTIC AND FOREIGN MARKET, INDUSTRY AND ECONOMIC TRENDS AND DEVELOPMENTS AND GOVERNMENT REGULATION AND THEIR POTENTIAL IMPACT ON THE FUND'S INVESTMENT PORTFOLIO. THESE STATEMENTS ARE SUBJECT TO RISKS AND UNCERTAINTIES AND ACTUAL TRENDS, DEVELOPMENTS AND REGULATIONS IN THE FUTURE AND THEIR IMPACT ON THE FUND COULD BE MATERIALLY DIFFERENT FROM THAT PROJECTED, ANTICIPATED OR IMPLIED. THE FUND HAS NO OBLIGATION TO UPDATE OR REVISE FORWARD-LOOKING STATEMENTS. 10 [CHART] COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN THE CREDIT SUISSE MID-CAP GROWTH FUND(1) COMMON CLASS SHARES, ADVISOR CLASS SHARES, THE RUSSELL 2500(TM) GROWTH INDEX(2), AND THE RUSSELL MIDCAP(R) GROWTH INDEX(3) FOR TEN YEARS.
CREDIT SUISSE MID-CAP GROWTH CREDIT SUISSE MID-CAP GROWTH RUSSELL 2500(TM) RUSSELL MIDCAP(R) FUND -- COMMON CLASS(1) FUND -- ADVISOR CLASS(1) GROWTH INDEX(2) GROWTH INDEX(3) 10/31/1994 $ 10,000 $ 10,000 $ 10,000 $ 10,000 11/30/1994 $ 9,513 $ 9,510 $ 9,557 $ 9,559 12/31/1994 $ 9,826 $ 9,819 $ 9,751 $ 9,693 1/31/1995 $ 9,678 $ 9,664 $ 9,656 $ 9,809 2/28/1995 $ 10,174 $ 10,159 $ 10,181 $ 10,331 3/31/1995 $ 10,451 $ 10,431 $ 10,576 $ 10,741 4/30/1995 $ 10,746 $ 10,717 $ 10,695 $ 10,831 5/31/1995 $ 10,871 $ 10,839 $ 10,859 $ 11,098 6/30/1995 $ 11,805 $ 11,769 $ 11,519 $ 11,603 7/31/1995 $ 12,677 $ 12,630 $ 12,427 $ 12,334 8/31/1995 $ 13,137 $ 13,079 $ 12,530 $ 12,469 9/30/1995 $ 13,825 $ 13,760 $ 12,799 $ 12,746 10/31/1995 $ 13,391 $ 13,324 $ 12,346 $ 12,424 11/30/1995 $ 13,735 $ 13,660 $ 12,851 $ 12,979 12/31/1995 $ 14,367 $ 14,287 $ 13,022 $ 12,986 1/31/1996 $ 14,168 $ 14,080 $ 13,062 $ 13,216 2/29/1996 $ 14,708 $ 14,615 $ 13,637 $ 13,716 3/31/1996 $ 14,960 $ 14,861 $ 13,933 $ 13,824 4/30/1996 $ 16,212 $ 16,095 $ 14,887 $ 14,492 5/31/1996 $ 16,425 $ 16,302 $ 15,418 $ 14,788 6/30/1996 $ 15,813 $ 15,690 $ 14,645 $ 14,341 7/31/1996 $ 14,106 $ 13,989 $ 13,190 $ 13,227 8/31/1996 $ 14,936 $ 14,803 $ 14,098 $ 13,942 9/30/1996 $ 15,775 $ 15,627 $ 14,846 $ 14,828 10/31/1996 $ 15,552 $ 15,415 $ 14,384 $ 14,654 11/30/1996 $ 15,652 $ 15,507 $ 14,911 $ 15,517 12/31/1996 $ 15,786 $ 15,633 $ 14,984 $ 15,256 1/31/1997 $ 16,361 $ 16,198 $ 15,433 $ 15,931 2/28/1997 $ 15,634 $ 15,469 $ 14,756 $ 15,580 3/31/1997 $ 14,731 $ 14,570 $ 13,785 $ 14,700 4/30/1997 $ 14,764 $ 14,599 $ 13,847 $ 15,060 5/31/1997 $ 16,432 $ 16,241 $ 15,507 $ 16,409 6/30/1997 $ 17,116 $ 16,913 $ 16,026 $ 16,864 7/31/1997 $ 18,114 $ 17,893 $ 17,043 $ 18,478 8/31/1997 $ 18,494 $ 18,260 $ 17,459 $ 18,297 9/30/1997 $ 19,877 $ 19,622 $ 18,692 $ 19,223 10/31/1997 $ 18,846 $ 18,593 $ 17,526 $ 18,261 11/30/1997 $ 18,732 $ 18,477 $ 17,257 $ 18,453 12/31/1997 $ 19,142 $ 18,875 $ 17,196 $ 18,695 1/31/1998 $ 18,661 $ 18,395 $ 16,971 $ 18,358 2/28/1998 $ 20,526 $ 20,227 $ 18,428 $ 20,084 3/31/1998 $ 21,499 $ 21,182 $ 19,112 $ 20,926 4/30/1998 $ 21,697 $ 21,368 $ 19,286 $ 21,211 5/31/1998 $ 20,384 $ 20,067 $ 18,048 $ 20,338 6/30/1998 $ 21,236 $ 20,898 $ 18,180 $ 20,914 7/31/1998 $ 19,593 $ 19,272 $ 16,826 $ 20,018 8/31/1998 $ 15,747 $ 15,484 $ 13,003 $ 16,197 9/30/1998 $ 16,345 $ 16,067 $ 14,143 $ 17,422 10/31/1998 $ 17,075 $ 16,779 $ 15,098 $ 18,705 11/30/1998 $ 18,124 $ 17,801 $ 16,172 $ 19,967 12/31/1998 $ 20,257 $ 19,892 $ 17,729 $ 22,034 1/31/1999 $ 20,567 $ 20,191 $ 18,242 $ 22,695 2/28/1999 $ 18,519 $ 18,168 $ 16,762 $ 21,585 3/31/1999 $ 19,497 $ 19,123 $ 17,542 $ 22,787 4/30/1999 $ 19,497 $ 19,118 $ 18,942 $ 23,826 5/31/1999 $ 19,822 $ 19,427 $ 19,137 $ 23,519 6/30/1999 $ 21,362 $ 20,924 $ 20,490 $ 25,161 7/31/1999 $ 21,068 $ 20,630 $ 20,073 $ 24,360 8/31/1999 $ 20,597 $ 20,160 $ 19,639 $ 24,107 9/30/1999 $ 20,617 $ 20,170 $ 19,779 $ 23,902 10/31/1999 $ 22,163 $ 21,672 $ 20,742 $ 25,750 11/30/1999 $ 24,581 $ 24,026 $ 23,191 $ 28,416 12/31/1999 $ 28,726 $ 28,065 $ 27,565 $ 33,337 1/31/2000 $ 27,793 $ 27,145 $ 27,411 $ 33,330 2/29/2000 $ 33,439 $ 32,646 $ 34,443 $ 40,336 3/31/2000 $ 32,333 $ 31,555 $ 31,740 $ 40,376 4/30/2000 $ 28,951 $ 28,241 $ 28,648 $ 36,456 5/31/2000 $ 26,848 $ 26,183 $ 26,097 $ 33,798 6/30/2000 $ 29,850 $ 29,098 $ 29,547 $ 37,384 7/31/2000 $ 28,807 $ 28,065 $ 27,126 $ 35,018 8/31/2000 $ 32,258 $ 31,415 $ 30,662 $ 40,299 9/30/2000 $ 32,010 $ 31,156 $ 28,679 $ 38,328 10/31/2000 $ 28,945 $ 28,165 $ 26,905 $ 35,706 11/30/2000 $ 23,558 $ 22,916 $ 21,779 $ 27,947 12/31/2000 $ 25,271 $ 24,577 $ 23,130 $ 29,420 1/31/2001 $ 25,032 $ 24,326 $ 24,628 $ 31,101 2/28/2001 $ 20,513 $ 19,934 $ 20,828 $ 25,720 3/31/2001 $ 18,253 $ 17,727 $ 18,523 $ 22,039 4/30/2001 $ 20,541 $ 19,934 $ 21,346 $ 25,713 5/31/2001 $ 20,210 $ 19,603 $ 21,965 $ 25,592 6/30/2001 $ 20,196 $ 19,589 $ 22,464 $ 25,605 7/31/2001 $ 19,126 $ 18,546 $ 20,808 $ 23,879 8/31/2001 $ 18,035 $ 17,475 $ 19,425 $ 22,148 9/30/2001 $ 15,494 $ 15,010 $ 16,383 $ 18,487 10/31/2001 $ 16,613 $ 16,088 $ 17,998 $ 20,430 11/30/2001 $ 18,246 $ 17,662 $ 19,554 $ 22,631 12/31/2001 $ 19,001 $ 18,383 $ 20,626 $ 23,491 1/31/2002 $ 18,191 $ 17,599 $ 19,744 $ 22,728 2/28/2002 $ 17,150 $ 16,578 $ 18,524 $ 21,439 3/31/2002 $ 18,107 $ 17,499 $ 20,015 $ 23,075 4/30/2002 $ 17,839 $ 17,233 $ 19,351 $ 21,855 5/31/2002 $ 17,044 $ 16,456 $ 18,375 $ 21,203 6/30/2002 $ 15,812 $ 15,263 $ 16,687 $ 18,862 7/31/2002 $ 13,404 $ 12,933 $ 14,614 $ 17,029 8/31/2002 $ 13,454 $ 12,977 $ 14,611 $ 16,969 9/30/2002 $ 12,524 $ 12,078 $ 13,507 $ 15,622 10/31/2002 $ 13,362 $ 12,869 $ 14,283 $ 16,833 11/30/2002 $ 14,193 $ 13,667 $ 15,612 $ 18,151 12/31/2002 $ 13,270 $ 12,768 $ 14,625 $ 17,054 1/31/2003 $ 13,362 $ 12,854 $ 14,306 $ 16,887 2/28/2003 $ 13,193 $ 12,682 $ 13,973 $ 16,740 3/31/2003 $ 13,327 $ 12,811 $ 14,157 $ 17,052 4/30/2003 $ 14,291 $ 13,731 $ 15,392 $ 18,213 5/31/2003 $ 15,727 $ 15,105 $ 17,023 $ 19,965 6/30/2003 $ 16,044 $ 15,407 $ 17,374 $ 20,251 7/31/2003 $ 16,812 $ 16,133 $ 18,531 $ 20,973 8/31/2003 $ 17,762 $ 17,038 $ 19,524 $ 22,129 9/30/2003 $ 17,164 $ 16,456 $ 19,105 $ 21,700 10/31/2003 $ 18,860 $ 18,074 $ 20,675 $ 23,449 11/30/2003 $ 19,283 $ 18,469 $ 21,374 $ 24,077 12/31/2003 $ 19,290 $ 18,476 $ 21,397 $ 24,340 1/31/2004 $ 20,409 $ 19,533 $ 22,290 $ 25,143 2/29/2004 $ 20,648 $ 19,756 $ 22,497 $ 25,565 3/31/2004 $ 20,979 $ 20,065 $ 22,576 $ 25,517 4/30/2004 $ 19,860 $ 18,987 $ 21,619 $ 24,797 5/31/2004 $ 20,205 $ 19,310 $ 22,068 $ 25,382 6/30/2004 $ 20,634 $ 19,706 $ 22,607 $ 25,786 7/31/2004 $ 18,874 $ 18,016 $ 20,837 $ 24,079 8/31/2004 $ 18,318 $ 17,484 $ 20,418 $ 23,783 9/30/2004 $ 19,036 $ 18,160 $ 21,339 $ 24,670 10/31/2004 $ 19,740 $ 18,821 $ 21,945 $ 25,506
[CHART] COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN THE CREDIT SUISSE MID-CAP GROWTH FUND CLASS A SHARES(4), THE RUSSELL 2500(TM) GROWTH INDEX(2), AND THE RUSSELL MIDCAP(R) GROWTH INDEX(3) FROM INCEPTION (11/30/01).
CREDIT SUISSE MID-CAP RUSSELL 2500(TM) RUSSELL MIDCAP(R) GROWTH FUND -- CLASS A(4) GROWTH INDEX(2) GROWTH INDEX(3) 11/30/2001 $ 9,425 $ 10,000 $ 10,000 12/31/2001 $ 9,812 $ 10,548 $ 10,380 1/31/2002 $ 9,390 $ 10,098 $ 10,043 2/28/2002 $ 8,848 $ 9,474 $ 9,474 3/31/2002 $ 9,339 $ 10,236 $ 10,196 4/30/2002 $ 9,197 $ 9,896 $ 9,657 5/31/2002 $ 8,786 $ 9,398 $ 9,369 6/30/2002 $ 8,146 $ 8,534 $ 8,335 7/31/2002 $ 6,903 $ 7,474 $ 7,525 8/31/2002 $ 6,928 $ 7,473 $ 7,498 9/30/2002 $ 6,448 $ 6,908 $ 6,903 10/31/2002 $ 6,873 $ 7,305 $ 7,438 11/30/2002 $ 7,303 $ 7,984 $ 8,020 12/31/2002 $ 6,823 $ 7,480 $ 7,536 1/31/2003 $ 6,870 $ 7,316 $ 7,462 2/28/2003 $ 6,779 $ 7,146 $ 7,397 3/31/2003 $ 6,844 $ 7,240 $ 7,535 4/30/2003 $ 7,339 $ 7,872 $ 8,048 5/31/2003 $ 8,077 $ 8,706 $ 8,822 6/30/2003 $ 8,237 $ 8,885 $ 8,948 7/31/2003 $ 8,630 $ 9,477 $ 9,268 8/31/2003 $ 9,117 $ 9,985 $ 9,778 9/30/2003 $ 8,808 $ 9,770 $ 9,589 10/31/2003 $ 9,674 $ 10,574 $ 10,361 11/30/2003 $ 9,888 $ 10,931 $ 10,639 12/31/2003 $ 9,892 $ 10,943 $ 10,755 1/31/2004 $ 10,463 $ 11,399 $ 11,110 2/29/2004 $ 10,583 $ 11,505 $ 11,297 3/31/2004 $ 10,750 $ 11,546 $ 11,275 4/30/2004 $ 10,176 $ 11,056 $ 10,957 5/31/2004 $ 10,350 $ 11,286 $ 11,216 6/30/2004 $ 10,565 $ 11,561 $ 11,394 7/31/2004 $ 9,663 $ 10,656 $ 10,640 8/31/2004 $ 9,375 $ 10,442 $ 10,509 9/30/2004 $ 9,743 $ 10,913 $ 10,901 10/31/2004 $ 10,099 $ 11,223 $ 11,271
11 [CHART] COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN THE CREDIT SUISSE MID-CAP GROWTH FUND CLASS B SHARES, CLASS C SHARES(4), THE RUSSELL 2500(TM) GROWTH INDEX(2) AND THE RUSSELL MIDCAP(R) GROWTH INDEX(3) FROM INCEPTION (02/27/04).
CREDIT SUISSE MID-CAP GROWTH CREDIT SUISSE MID-CAP GROWTH RUSSELL 2500(TM) RUSSELL MIDCAP(R) FUND -- CLASS B(4) FUND -- CLASS C(4) GROWTH INDEX(2) GROWTH INDEX(3) 2/27/2004 $ 10,000 $ 10,000 $ 10,000 $ 10,000 2/29/2004 $ 10,000 $ 10,000 $ 10,093 $ 10,168 3/31/2004 $ 10,155 $ 10,158 $ 10,128 $ 10,149 4/30/2004 $ 9,605 $ 9,612 $ 9,699 $ 9,862 5/31/2004 $ 9,763 $ 9,777 $ 9,901 $ 10,095 6/30/2004 $ 9,962 $ 9,979 $ 10,142 $ 10,256 7/31/2004 $ 9,103 $ 9,120 $ 9,348 $ 9,577 8/31/2004 $ 8,828 $ 8,849 $ 9,160 $ 9,459 9/30/2004 $ 9,168 $ 9,186 $ 9,573 $ 9,812 10/31/2004 $ 9,498 $ 9,509 $ 9,845 $ 10,144
AVERAGE ANNUAL RETURNS AS OF SEPTEMBER 30, 2004
SINCE 1 YEAR 5 YEARS 10 YEARS INCEPTION ------------- ------------- ------------- ------------- Common Class(6) 10.91% (1.58)% 6.90% 10.21% Advisor Class(7) 10.35% (2.08)% 6.39% 8.77% Class A Without Sales Charge 10.61% -- -- 1.17% Class A With Maximum Sales Charge 4.24% -- -- (0.91)% Class B Without CDSC -- -- -- (8.32)%(5) Class B With CDSC -- -- -- (11.98)%(5) Class C Without CDSC -- -- -- (8.14)%(5) Class C With CDSC -- -- -- (9.06)%(5)
12 AVERAGE ANNUAL RETURNS AS OF OCTOBER 31, 2004
SINCE 1 YEAR 5 YEARS 10 YEARS INCEPTION ------------- ------------- ------------- ------------- Common Class(6) 4.67% (2.29)% 7.04% 10.39% Advisor Class(7) 4.14% (2.78)% 6.53% 9.01% Class A Without Sales Charge 4.40% -- -- 2.39% Class A With Maximum Sales Charge (1.59)% -- -- 0.34% Class B Without CDSC -- -- -- (5.02)%(5) Class B With CDSC -- -- -- (8.82)%(5) Class C Without CDSC -- -- -- (4.91)%(5) Class C With CDSC -- -- -- (5.86)%(5)
RETURNS REPRESENT PAST PERFORMANCE AND INCLUDE CHANGE IN SHARE PRICE AND REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS. PAST PERFORMANCE CANNOT GUARANTEE FUTURE RESULTS. THE CURRENT PERFORMANCE OF THE FUND MAY BE LOWER OR HIGHER THAN THE FIGURES SHOWN. RETURNS AND SHARE PRICE WILL FLUCTUATE, AND REDEMPTION VALUE MAY BE LESS THAN ORIGINAL COST. THE PERFORMANCE RESULTS DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND SHARES. PERFORMANCE INFORMATION CURRENT TO THE MOST RECENT MONTH-END IS AVAILABLE AT www.csam.com/us. ---------- (1) Effective May 1, 2004 the Fund changed its name from Credit Suisse Emerging Growth Fund to Credit Suisse Mid-Cap Growth Fund. (2) The Russell 2500(TM) Growth Index measures the performance of those companies in the Russell 2500(TM) Index with higher price-to-book ratios and higher forecasted growth values. It is an unmanaged index of common stocks that includes reinvestment of dividends and is compiled by Frank Russell Company. Investors cannot invest directly in a an index. (3) The Russell Midcap(R) Growth Index measures the performance of those companies in the Russell Midcap(R) Index with higher price-to-book ratios and higher forecasted growth values. The stocks are also members of the Russell 1000(R) Growth Index. It is an unmanaged index of common stocks that includes reinvestment of dividends and compiled by Frank Russell Company. Investors cannot invest directly in an index. (4) Total return for Class A Shares for the reporting period, based on offering price (with maximum sales charge of 5.75%), was down 1.59%. Total return for Class B Shares for the reporting period, based on redemption value (including maximum contingent deferred sales charge of 4%), was down 8.82%. Total return for Class C Shares for the reporting period, based on redemption value (including maximum contingent deferred sales charge of 1%), was down 5.86%. (5) Inception Date: 2/27/04; Returns for periods less than one year are not annualized. (6) Inception Date: 1/21/88. (7) Inception Date: 6/20/91. 13 INFORMATION ABOUT YOUR FUND'S EXPENSES As an investor of the Fund, you incur two types of costs: ongoing expenses and transaction costs. Ongoing expenses include management fees, distribution and service (12b-1) fees and other Fund expenses. Examples of transaction costs include sales charges (loads), redemption fees and account maintenance fees, which are not shown in this section and which would result in higher total expenses. The following table is intended to help you understand your ongoing expenses of investing in the Fund and to help you compare these expenses with the ongoing expenses of investing in other mutual funds. The table is based on an investment of $1,000 made at the beginning of the six-month period ended October 31, 2004. The table illustrates your Fund's expenses in two ways: - ACTUAL FUND RETURN. This helps you estimate the actual dollar amount of ongoing expenses paid on a $1,000 investment in the Fund using the Fund's actual return during the period. To estimate the expenses 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 "Expenses Paid per $1,000" line under the share class you hold. - HYPOTHETICAL 5% FUND RETURN. This helps you to compare your Fund's ongoing expenses with those of other mutual funds using the Fund's actual expense ratio and a hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical fund return may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expense you paid for the period. Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. If these transaction costs had been included, your costs would have been higher. The "Expenses Paid per $1,000" line of the tables is useful in comparing ongoing expenses only and will not help you determine the relative total expenses of owning different funds. 14 EXPENSES AND VALUE OF A $1,000 INVESTMENT FOR THE SIX-MONTH PERIOD ENDED OCTOBER 31, 2004
COMMON ADVISOR CLASS CLASS CLASS A CLASS B CLASS C -------- -------- -------- -------- -------- ACTUAL FUND RETURN Beginning Account Value 4/30/04 $ 1,000 $ 1,000 $ 1,000 $ 1,000 $ 1,000 Ending Account Value 10/31/04 $ 994 $ 991 $ 993 $ 989 $ 989 Expenses Paid per $1,000* $ 7.02 $ 9.51 $ 8.26 $ 12.00 $ 12.00 HYPOTHETICAL 5% FUND RETURN Beginning Account Value 4/30/04 $ 1,000 $ 1,000 $ 1,000 $ 1,000 $ 1,000 Ending Account Value 10/31/04 $ 1,025 $ 1,025 $ 1,025 $ 1,025 $ 1,025 Expenses Paid per $1,000* $ 7.13 $ 9.67 $ 8.40 $ 12.22 $ 12.22 COMMON ADVISOR CLASS CLASS CLASS A CLASS B CLASS C -------- -------- -------- -------- -------- ANNUALIZED EXPENSE RATIOS* 1.40% 1.90% 1.65% 2.40% 2.40%
---------- * EXPENSES ARE EQUAL TO THE FUND'S ANNUALIZED EXPENSE RATIO FOR EACH SHARE CLASS, MULTIPLIED BY THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY THE NUMBER OF DAYS IN THE MOST RECENT FISCAL HALF YEAR PERIOD, THEN DIVIDED BY 366. THE "EXPENSES PAID PER $1,000" AND THE "ANNUALIZED EXPENSE RATIOS" IN THE TABLES ARE BASED ON ACTUAL EXPENSES PAID BY THE FUND DURING THE PERIOD, NET OF FEE WAIVERS AND/OR EXPENSE REIMBURSEMENTS. IF THOSE FEE WAIVERS AND/OR EXPENSE REIMBURSEMENTS HAD NOT BEEN IN EFFECT, THE FUND'S ACTUAL EXPENSES WOULD HAVE BEEN HIGHER. For more information, please refer to the Fund's prospectus. 15 [CHART] SECTOR BREAKDOWN* Consumer Discretionary 26.3% Technology 21.3% Health Care 15.8% Financial Services 10.6% Other Energy 6.7% Other Assets 5.0% Producer Durables 4.1% Auto & Transportation 3.5% Materials & Processing 3.0% Utilities 1.9% Consumer Staples 1.8%
---------- * The Fund's sector breakdown is expressed as a percentage of total investments (excluding security lending collateral) and may vary over time. 16 CREDIT SUISSE SMALL CAP GROWTH FUND ANNUAL INVESTMENT ADVISER'S REPORT October 31, 2004 (unaudited) November 24, 2004 Dear Shareholder: PERFORMANCE SUMMARY 11/01/03 - 10/31/04
SHARE CLASS/BENCHMARK PERFORMANCE Common(1) 2.37% Advisor(1) (5.70)%(4) Class A(1) 2.37% Class B(1) (5.95)%(4) Class C(1) (5.95)%(4) Russell 2000(R) Growth Index(2) 5.53%
Performance for the Fund's Class A, Class B and Class C shares is without the maximum sales charge of 5.75%, 4.00% and 1.00%, respectively.(3) MARKET OVERVIEW: STRONG START GIVES WAY TO SEESAW FINISH The US equity market began the period on a strong note. An improving outlook for the economy and corporate profits continued to help stocks regain their footing after 2000's "bubble burst." However, the market faced headwinds as 2004 progressed, mostly in the form of domestic and international political uncertainty, worries over rising interest rates and a surge in oil prices. The market hit its low for the reporting period in August, but then moved upward again as inflation and interest-rate fears subsided. Growth stocks had a positive showing for the 12 months, but lagged value stocks, reflecting the outperformance of energy and industrial-type companies, which comprise a larger share of the value universe. Small capitalization stocks outpaced large cap stocks, a trend often (but not always) seen in the early stages of economic recovery. STRATEGIC REVIEW: HELPED BY HEALTH CARE, HINDERED BY CHIP EQUIPMENT The Fund had a gain but trailed its benchmark, in part due to stock selection in the financial services sector. ESpeed (0.3% of the Fund's portfolio as of October 31, 2004), an electronic securities trading company, sold off on competition fears. We eliminated the position in November. In addition, the Fund's semiconductor-equipment stocks fell amid a broad selloff in the group, hampering our performance in the producer durables sector. We selectively reduced our semiconductor exposure in the latter part of the period. Positive forces for the Fund included stock focus within technology. Our holdings here outperformed the benchmark's technology component by a wide margin, aided by Tessera Technologies (1.4% of the Fund's portfolio as of 17 October 31, 2004). The intellectual property rights company rallied on optimism regarding its royalty revenues. The Fund's health care stocks contributed positively to its relative and absolute return, led by Sepracor (0.8% of the Fund's portfolio as of October 31, 2004), a pharmaceutical company specializing in respiratory treatments, and Centene (0.8% of the Fund's portfolio as of October 31, 2004), a diversified managed care stock that was buoyed by continued, consistent profit growth. The Fund also drew support from an overweighting and good stock selection in the energy sector. GOING FORWARD: OPPORTUNITIES IN VARIED SECTORS We have adjusted our producer durables exposure, ending the period with an underweighting after being modestly overweighted a year ago. We still view specific stocks here positively, including Kennametal (0.9% of the Fund's portfolio as of October 31, 2004), a tool and die maker we added to the Fund late in the period. We believe that a recovery in industrial America should support its long-term growth prospects. Elsewhere, we think that an improving economy stands to benefit brokerages and money managers, and hence have a bias toward these companies within the financial sector. We also have exposure to providers of business intelligence software, demand for which is rising due to greater corporate accountability associated with Sarbanes-Oxley legislation. As we move ahead, another strategy is to potentially take advantage of demographic trends by investing in videogame manufacturers as their market expands beyond teenage males. The Credit Suisse Small/Mid-Cap Growth Team Marian U. Pardo Leo M. Bernstein Calvin E. Chung Credit Suisse Asset Management, LLC (CSAM) INVESTMENTS IN SMALL COMPANIES MAY BE MORE VOLATILE AND LESS LIQUID THAN INVESTMENTS IN LARGER COMPANIES. IN ADDITION TO HISTORICAL INFORMATION, THIS REPORT CONTAINS FORWARD-LOOKING STATEMENTS, WHICH MAY CONCERN, AMONG OTHER THINGS, DOMESTIC AND FOREIGN MARKET, INDUSTRY AND ECONOMIC TRENDS AND DEVELOPMENTS AND GOVERNMENT REGULATION AND THEIR POTENTIAL IMPACT ON THE FUND'S INVESTMENT PORTFOLIO. THESE STATEMENTS ARE SUBJECT TO RISKS AND UNCERTAINTIES AND ACTUAL TRENDS, DEVELOPMENTS AND REGULATIONS IN THE FUTURE AND THEIR IMPACT ON THE FUND COULD BE MATERIALLY DIFFERENT FROM THAT PROJECTED, ANTICIPATED OR IMPLIED. THE FUND HAS NO OBLIGATION TO UPDATE OR REVISE FORWARD-LOOKING STATEMENTS. 18 [CHART] COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN THE CREDIT SUISSE SMALL CAP GROWTH FUND(1) COMMON CLASS SHARES AND THE RUSSELL 2000(R) GROWTH INDEX(2) FROM INCEPTION (12/31/96).
CREDIT SUISSE SMALL CAP RUSSELL 2000(R) GROWTH FUND(1) -- COMMON CLASS GROWTH INDEX(2) 12/31/1996 $ 10,000 $ 10,000 1/31/1997 $ 10,350 $ 10,250 2/28/1997 $ 10,020 $ 9,631 3/31/1997 $ 9,250 $ 8,951 4/30/1997 $ 8,940 $ 8,848 5/31/1997 $ 10,280 $ 10,177 6/30/1997 $ 10,840 $ 10,523 7/31/1997 $ 11,370 $ 11,062 8/31/1997 $ 11,650 $ 11,394 9/30/1997 $ 12,930 $ 12,303 10/31/1997 $ 12,250 $ 11,564 11/30/1997 $ 12,070 $ 11,288 12/31/1997 $ 12,229 $ 11,295 1/31/1998 $ 11,927 $ 11,144 2/28/1998 $ 12,802 $ 12,128 3/31/1998 $ 13,637 $ 12,637 4/30/1998 $ 13,496 $ 12,714 5/31/1998 $ 12,360 $ 11,790 6/30/1998 $ 12,591 $ 11,911 7/31/1998 $ 11,414 $ 10,916 8/31/1998 $ 8,951 $ 8,396 9/30/1998 $ 9,846 $ 9,248 10/31/1998 $ 10,167 $ 9,730 11/30/1998 $ 11,093 $ 10,485 12/31/1998 $ 12,058 $ 11,434 1/31/1999 $ 12,621 $ 11,948 2/28/1999 $ 11,646 $ 10,855 3/31/1999 $ 12,501 $ 11,242 4/30/1999 $ 12,993 $ 12,234 5/31/1999 $ 13,064 $ 12,254 6/30/1999 $ 14,572 $ 12,899 7/31/1999 $ 14,401 $ 12,500 8/31/1999 $ 14,391 $ 12,033 9/30/1999 $ 15,156 $ 12,265 10/31/1999 $ 16,694 $ 12,579 11/30/1999 $ 19,138 $ 13,909 12/31/1999 $ 24,023 $ 16,361 1/31/2000 $ 23,826 $ 16,208 2/29/2000 $ 32,636 $ 19,979 3/31/2000 $ 28,921 $ 17,879 4/30/2000 $ 24,531 $ 16,074 5/31/2000 $ 22,197 $ 14,666 6/30/2000 $ 26,628 $ 16,561 7/31/2000 $ 23,712 $ 15,142 8/31/2000 $ 27,427 $ 16,734 9/30/2000 $ 25,611 $ 15,903 10/31/2000 $ 23,981 $ 14,612 11/30/2000 $ 19,862 $ 11,959 12/31/2000 $ 21,833 $ 12,691 1/31/2001 $ 21,387 $ 13,718 2/28/2001 $ 18,824 $ 11,837 3/31/2001 $ 16,655 $ 10,761 4/30/2001 $ 19,032 $ 12,078 5/31/2001 $ 18,814 $ 12,358 6/30/2001 $ 19,270 $ 12,696 7/31/2001 $ 18,191 $ 11,613 8/31/2001 $ 17,101 $ 10,887 9/30/2001 $ 14,414 $ 9,130 10/31/2001 $ 15,960 $ 10,008 11/30/2001 $ 17,517 $ 10,844 12/31/2001 $ 18,980 $ 11,519 1/31/2002 $ 18,419 $ 11,109 2/28/2002 $ 16,801 $ 10,390 3/31/2002 $ 18,295 $ 11,293 4/30/2002 $ 17,807 $ 11,049 5/31/2002 $ 16,697 $ 10,403 6/30/2002 $ 15,223 $ 9,521 7/31/2002 $ 12,992 $ 8,057 8/31/2002 $ 12,847 $ 8,053 9/30/2002 $ 12,276 $ 7,472 10/31/2002 $ 13,054 $ 7,850 11/30/2002 $ 14,102 $ 8,628 12/31/2002 $ 13,137 $ 8,033 1/31/2003 $ 12,878 $ 7,814 2/28/2003 $ 12,629 $ 7,606 3/31/2003 $ 12,785 $ 7,720 4/30/2003 $ 13,739 $ 8,451 5/31/2003 $ 15,317 $ 9,403 6/30/2003 $ 15,493 $ 9,585 7/31/2003 $ 16,686 $ 10,309 8/31/2003 $ 17,620 $ 10,863 9/30/2003 $ 16,852 $ 10,588 10/31/2003 $ 18,824 $ 11,503 11/30/2003 $ 19,146 $ 11,878 12/31/2003 $ 19,239 $ 11,931 1/31/2004 $ 20,360 $ 12,558 2/29/2004 $ 20,401 $ 12,539 3/31/2004 $ 20,889 $ 12,598 4/30/2004 $ 19,716 $ 11,965 5/31/2004 $ 20,194 $ 12,203 6/30/2004 $ 20,692 $ 12,610 7/31/2004 $ 18,492 $ 11,477 8/31/2004 $ 18,108 $ 11,231 9/30/2004 $ 18,866 $ 11,852 10/31/2004 $ 19,270 $ 12,140
[CHART] COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN THE CREDIT SUISSE SMALL CAP GROWTH FUND(1) CLASS A SHARES(3) AND THE RUSSELL 2000(R) GROWTH INDEX(2) FROM INCEPTION (11/30/01).
CREDIT SUISSE SMALL CAP RUSSELL 2000(R) GROWTH FUND(1) -- CLASS A(3) GROWTH INDEX(2) 11/30/2001 $ 9,425 $ 10,000 12/31/2001 $ 10,207 $ 10,623 1/31/2002 $ 9,911 $ 10,245 2/28/2002 $ 9,040 $ 9,582 3/31/2002 $ 9,844 $ 10,414 4/30/2002 $ 9,581 $ 10,190 5/31/2002 $ 8,984 $ 9,593 6/30/2002 $ 8,191 $ 8,780 7/31/2002 $ 6,991 $ 7,430 8/31/2002 $ 6,912 $ 7,427 9/30/2002 $ 6,605 $ 6,891 10/31/2002 $ 7,018 $ 7,239 11/30/2002 $ 7,582 $ 7,957 12/31/2002 $ 7,063 $ 7,408 1/31/2003 $ 6,929 $ 7,206 2/28/2003 $ 6,790 $ 7,014 3/31/2003 $ 6,879 $ 7,120 4/30/2003 $ 7,387 $ 7,793 5/31/2003 $ 8,236 $ 8,671 6/30/2003 $ 8,331 $ 8,839 7/31/2003 $ 8,973 $ 9,507 8/31/2003 $ 9,481 $ 10,017 9/30/2003 $ 9,062 $ 9,764 10/31/2003 $ 10,128 $ 10,608 11/30/2003 $ 10,302 $ 10,953 12/31/2003 $ 10,346 $ 11,003 1/31/2004 $ 10,955 $ 11,580 2/29/2004 $ 10,972 $ 11,563 3/31/2004 $ 11,234 $ 11,617 4/30/2004 $ 10,609 $ 11,034 5/31/2004 $ 10,860 $ 11,254 6/30/2004 $ 11,128 $ 11,629 7/31/2004 $ 9,950 $ 10,584 8/31/2004 $ 9,743 $ 10,357 9/30/2004 $ 10,151 $ 10,929 10/31/2004 $ 10,369 $ 11,195
19 [CHART] COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN THE CREDIT SUISSE SMALL CAP GROWTH FUND(1) ADVISOR CLASS SHARES, CLASS B SHARES(3), CLASS C SHARES(3) AND THE RUSSELL 2000(R) GROWTH INDEX(2) FROM INCEPTION (02/27/04).
CREDIT SUISSE SMALL CAP CREDIT SUISSE SMALL CAP CREDIT SUISSE SMALL CAP RUSSELL 2000(R) GROWTH FUND(1) -- ADVISOR CLASS GROWTH FUND(1) -- CLASS B(3) GROWTH FUND(1) -- CLASS C(3) GROWTH INDEX(2) 2/27/2004 $ 10,000 $ 10,000 $ 10,000 $ 10,000 2/29/2004 $ 10,000 $ 10,000 $ 10,000 $ 9,985 3/31/2004 $ 10,239 $ 10,234 $ 10,234 $ 10,032 4/30/2004 $ 9,664 $ 9,654 $ 9,654 $ 9,528 5/31/2004 $ 9,898 $ 9,878 $ 9,878 $ 9,718 6/30/2004 $ 10,142 $ 10,117 $ 10,117 $ 10,042 7/31/2004 $ 9,064 $ 9,038 $ 9,038 $ 9,140 8/31/2004 $ 8,865 $ 8,850 $ 8,850 $ 8,943 9/30/2004 $ 9,237 $ 9,216 $ 9,216 $ 9,438 10/31/2004 $ 9,405 $ 9,405 $ 9,430 $ 9,667
AVERAGE ANNUAL RETURNS AS OF SEPTEMBER 30, 2004(1)
SINCE 1 YEAR 5 YEARS INCEPTION ----------- ----------- ----------- Common Class 11.95% 4.48% 8.53% Advisor Class -- -- (7.63)%(4) Class A Without Sales Charge 12.01% -- 2.65% Class A With Maximum Sales Charge 5.57% -- 0.53% Class B Without CDSC -- -- (7.84)%(4) Class B With CDSC -- -- (11.52)%(4) Class C Without CDSC -- -- (7.84)%(4) Class C With CDSC -- -- (8.76)%(4)
20 AVERAGE ANNUAL RETURNS AS OF OCTOBER 31, 2004(1)
SINCE 1 YEAR 5 YEARS INCEPTION ----------- ----------- ----------- Common Class 2.37% 2.91% 8.73% Advisor Class -- -- (5.70)%(4) Class A Without Sales Charge 2.37% -- 3.32% Class A With Maximum Sales Charge (3.53)% -- 1.25% Class B Without CDSC -- -- (5.95)%(4) Class B With CDSC -- -- (9.72)%(4) Class C Without CDSC -- -- (5.95)%(4) Class C With CDSC -- -- (6.89)%(4)
RETURNS REPRESENT PAST PERFORMANCE AND INCLUDE CHANGE IN SHARE PRICE AND REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS. PAST PERFORMANCE CANNOT GUARANTEE FUTURE RESULTS. THE CURRENT PERFORMANCE OF THE FUND MAY BE LOWER OR HIGHER THAN THE FIGURES SHOWN. RETURNS AND SHARE PRICE WILL FLUCTUATE, AND REDEMPTION VALUE MAY BE LESS THAN ORIGINAL COST. THE PERFORMANCE RESULTS DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND SHARES. PERFORMANCE INFORMATION CURRENT TO THE MOST RECENT MONTH-END IS AVAILABLE AT www.csam.com/us. ---------- (1) Fee waivers and/or expense reimbursements reduced expenses for the Fund, without which performance would be lower. Waivers and/or reimbursements may be discontinued at any time. (2) The Russell 2000(R) Growth Index measures the performance of those companies in the Russell 2000(R) Index with higher price-to-book ratios and higher forecasted growth values. It is an unmanaged index of common stocks that includes reinvestment of dividends and is compiled by Frank Russell Company. Investors cannot invest directly in an index. (3) Total return for Class A Shares for the reporting period, based on offering price (with maximum sales charge of 5.75%), was down 3.53%. Total return for Class B Shares for the reporting period, based on redemption value (including maximum contingent deferred sales charge of 4%), was down 9.72%. Total return for Class C Shares for the reporting period, based on redemption value (including maximum contingent deferred sales charge of 1%), was down 6.89%. (4) Inception Date: 2/27/04; Returns for periods less than one year are not annualized. 21 INFORMATION ABOUT YOUR FUND'S EXPENSES As an investor of the Fund, you incur two types of costs: ongoing expenses and transaction costs. Ongoing expenses include management fees, distribution and service (12b-1) fees and other Fund expenses. Examples of transaction costs include sales charges (loads), redemption fees and account maintenance fees, which are not shown in this section and which would result in higher total expenses. The following table is intended to help you understand your ongoing expenses of investing in the Fund and to help you compare these expenses with the ongoing expenses of investing in other mutual funds. The table is based on an investment of $1,000 made at the beginning of the six-month period ended October 31, 2004. The table illustrates your Fund's expenses in two ways: - ACTUAL FUND RETURN. This helps you estimate the actual dollar amount of ongoing expenses paid on a $1,000 investment in the Fund using the Fund's actual return during the period. To estimate the expenses 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 "Expenses Paid per $1,000" line under the share class you hold. - HYPOTHETICAL 5% FUND RETURN. This helps you to compare your Fund's ongoing expenses with those of other mutual funds using the Fund's actual expense ratio and a hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical fund return may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expense you paid for the period. Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. If these transaction costs had been included, your costs would have been higher. The "Expenses Paid per $1,000" line of the tables is useful in comparing ongoing expenses only and will not help you determine the relative total expenses of owning different funds. 22 EXPENSES AND VALUE OF A $1,000 INVESTMENT FOR THE SIX-MONTH PERIOD ENDED OCTOBER 31, 2004
COMMON ADVISOR CLASS CLASS CLASS A CLASS B CLASS C -------- -------- -------- -------- -------- ACTUAL FUND RETURN Beginning Account Value 4/30/04 $ 1,000 $ 1,000 $ 1,000 $ 1,000 $ 1,000 Ending Account Value 10/31/04 $ 977 $ 976 $ 977 $ 974 $ 974 Expenses Paid per $1,000* $ 6.96 $ 8.19 $ 6.96 $ 10.67 $ 10.67 HYPOTHETICAL 5% FUND RETURN Beginning Account Value 4/30/04 $ 1,000 $ 1,000 $ 1,000 $ 1,000 $ 1,000 Ending Account Value 10/31/04 $ 1,025 $ 1,025 $ 1,025 $ 1,025 $ 1,025 Expenses Paid per $1,000* $ 7.13 $ 8.40 $ 7.13 $ 10.94 $ 10.94 COMMON ADVISOR CLASS CLASS CLASS A CLASS B CLASS C -------- -------- -------- -------- -------- ANNUALIZED EXPENSE RATIOS* 1.40% 1.65% 1.40% 2.15% 2.15%
---------- * EXPENSES ARE EQUAL TO THE FUND'S ANNUALIZED EXPENSE RATIO FOR EACH SHARE CLASS, MULTIPLIED By THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY THE NUMBER OF DAYS IN THE MOST RECENT FISCAL HALF YEAR PERIOD, THEN DIVIDED BY 366. THE "EXPENSES PAID PER $1,000" AND THE "ANNUALIZED EXPENSE RATIOS" IN THE TABLES ARE BASED ON ACTUAL EXPENSES PAID BY THE FUND DURING THE PERIOD, NET OF FEE WAIVERS AND/OR EXPENSE REIMBURSEMENTS. IF THOSE FEE WAIVERS AND/OR EXPENSE REIMBURSEMENTS HAD NOT BEEN IN EFFECT, THE FUND'S ACTUAL EXPENSES WOULD HAVE BEEN HIGHER. For more information, please refer to the Fund's prospectus. 23 [CHART] SECTOR BREAKDOWN* Consumer Discretionary 25.6% Health Care 23.4% Technology 19.5% Other Assets 7.8% Other Energy 6.5% Financial Services 6.0% Producer Durables 5.5% Materials & Processing 3.8% Consumer Staples 1.7% Auto & Transportation 0.2%
---------- * The Fund's sector breakdown is expressed as a percentage of total investments (excluding security lending collateral) and may vary over time. 24 CREDIT SUISSE CAPITAL APPRECIATION FUND SCHEDULE OF INVESTMENTS October 31, 2004
NUMBER OF SHARES VALUE --------------- --------------- COMMON STOCKS (97.4%) AEROSPACE & DEFENSE (1.8%) United Technologies Corp. 88,500 $ 8,214,570 --------------- AUTO COMPONENTS (1.1%) Autoliv, Inc.@ 114,100 4,877,775 --------------- BIOTECHNOLOGY (6.6%) Biogen Idec, Inc.* 83,700 4,867,992 Genentech, Inc.* 175,700 7,999,621 Genzyme Corp.* 136,900 7,183,143 Gilead Sciences, Inc.* 289,600 10,028,848 --------------- 30,079,604 --------------- CHEMICALS (3.4%) Dow Chemical Co. 92,700 4,165,938 Du Pont (E. I.) de Nemours & Co. 209,900 8,998,413 Monsanto Co. 54,500 2,329,875 --------------- 15,494,226 --------------- COMMERCIAL SERVICES & SUPPLIES (3.1%) Automatic Data Processing, Inc. 318,300 13,811,037 --------------- COMMUNICATIONS EQUIPMENT (8.4%) Avaya, Inc.* 300,200 4,322,880 Cisco Systems, Inc.* 544,600 10,461,766 Comverse Technology, Inc.* 261,300 5,393,232 Corning, Inc.* 764,400 8,752,380 Motorola, Inc. 537,900 9,284,154 --------------- 38,214,412 --------------- COMPUTERS & PERIPHERALS (3.5%) Dell, Inc.* 145,100 5,087,206 EMC Corp.* 516,500 6,647,355 Lexmark International, Inc. Class A* 49,500 4,113,945 --------------- 15,848,506 --------------- DIVERSIFIED FINANCIALS (4.8%) Capital One Financial Corp. 181,500 13,387,440 Countrywide Financial Corp. 264,000 8,429,520 --------------- 21,816,960 --------------- ENERGY EQUIPMENT & SERVICES (1.6%) BJ Services Co. 140,800 7,180,800 Bonneville Pacific Corp.*^ 16,883 1 --------------- 7,180,801 --------------- FOOD & DRUG RETAILING (1.2%) Whole Foods Market, Inc.@ 69,000 5,618,670 --------------- FOOD PRODUCTS (1.0%) Sara Lee Corp. 200,800 4,674,624 ---------------
See Accompanying Notes to Financial Statements. 25
NUMBER OF SHARES VALUE --------------- --------------- COMMON STOCKS HEALTHCARE EQUIPMENT & SUPPLIES (7.1%) Boston Scientific Corp.* 279,600 $ 9,869,880 Dade Behring Holdings, Inc.* 82,100 4,621,409 Guidant Corp. 111,900 7,454,778 St. Jude Medical, Inc.* 132,500 10,145,525 --------------- 32,091,592 --------------- HEALTHCARE PROVIDERS & SERVICES (1.2%) Anthem, Inc.*@ 64,800 5,209,920 --------------- HOTELS, RESTAURANTS & LEISURE (2.4%) Starbucks Corp.* 203,800 10,776,944 --------------- INDUSTRIAL CONGLOMERATES (6.1%) General Electric Co. 403,500 13,767,420 Tyco International, Ltd. 447,300 13,933,395 --------------- 27,700,815 --------------- INTERNET & CATALOG RETAIL (2.9%) eBay, Inc.* 133,500 13,030,935 --------------- INTERNET SOFTWARE & SERVICES (5.7%) McAfee, Inc.* 220,600 5,338,520 VeriSign, Inc.* 256,700 6,887,261 Yahoo!, Inc.* 371,500 13,444,585 --------------- 25,670,366 --------------- MACHINERY (3.6%) Caterpillar, Inc. 28,900 2,327,606 Danaher Corp. 216,800 11,952,184 Deere & Co. 32,900 1,966,762 --------------- 16,246,552 --------------- MEDIA (7.9%) DreamWorks Animation SKG, Inc. Class A* 28,400 1,109,020 E.W. Scripps Co. Class A@ 95,000 4,533,400 Getty Images, Inc.*@ 80,000 4,730,400 News Corporation, Ltd. ADR*@ 150,371 4,727,664 Time Warner, Inc.* 561,400 9,341,696 Viacom, Inc. Class B 304,892 11,125,509 --------------- 35,567,689 --------------- METALS & MINING (2.2%) Alcoa, Inc. 154,600 5,024,500 Newmont Mining Corp. 99,800 4,742,496 --------------- 9,766,996 --------------- MULTILINE RETAIL (1.0%) Wal-Mart Stores, Inc. 80,300 4,329,776 --------------- OIL & GAS (2.0%) XTO Energy, Inc. 269,075 8,981,724 ---------------
See Accompanying Notes to Financial Statements. 26
NUMBER OF SHARES VALUE --------------- --------------- COMMON STOCKS PERSONAL PRODUCTS (2.0%) Avon Products, Inc. 123,200 $ 4,872,560 Estee Lauder Companies, Inc. Class A 101,300 4,350,835 --------------- 9,223,395 --------------- PHARMACEUTICALS (6.3%) Eli Lilly & Co. 118,000 6,479,380 Schering-Plough Corp. 766,000 13,872,260 Sepracor, Inc.*@ 173,500 7,968,855 --------------- 28,320,495 --------------- SEMICONDUCTOR EQUIPMENT & PRODUCTS (1.0%) Applied Materials, Inc.* 287,700 4,631,970 --------------- SOFTWARE (4.8%) Macromedia, Inc.* 126,100 3,422,354 Microsoft Corp. 657,200 18,395,028 --------------- 21,817,382 --------------- SPECIALTY RETAIL (4.7%) Best Buy Company, Inc. 128,600 7,615,692 The Gap, Inc. 421,500 8,421,570 TJX Companies, Inc. 219,700 5,268,406 --------------- 21,305,668 --------------- TOTAL COMMON STOCKS (Cost $396,858,626) 440,503,404 --------------- SHORT-TERM INVESTMENTS (7.2%) State Street Navigator Prime Fund** 18,946,701 18,946,701 PAR (000) --------------- State Street Bank and Trust Co. Euro Time Deposit, 1.000%, 11/01/04 $ 13,733 13,733,000 --------------- TOTAL SHORT-TERM INVESTMENTS (Cost $32,679,701) 32,679,701 --------------- TOTAL INVESTMENTS AT VALUE (104.6%) (Cost $429,538,327) 473,183,105 LIABILITIES IN EXCESS OF OTHER ASSETS (-4.6%) (20,898,066) --------------- NET ASSETS (100.0%) $ 452,285,039 ===============
INVESTMENT ABBREVIATION ADR = American Depository Receipt * Non-income producing security. ^ Not readily marketable security; security is valued at fair value as determined in good faith by, or under the direction of, the Board of Trustees. @ Security or portion thereof is out on loan. ** Represents security purchased with cash collateral received for securities on loan. See Accompanying Notes to Financial Statements. 27 CREDIT SUISSE MID-CAP GROWTH FUND SCHEDULE OF INVESTMENTS October 31, 2004
NUMBER OF SHARES VALUE --------------- --------------- COMMON STOCKS (96.3%) AEROSPACE & DEFENSE (3.8%) Alliant Techsystems, Inc.* 83,700 $ 4,811,913 Goodrich Corp. 159,700 4,923,551 L-3 Communications Holdings, Inc. 75,800 4,997,494 --------------- 14,732,958 --------------- AUTO COMPONENTS (1.7%) Autoliv, Inc. 156,600 6,694,650 --------------- BIOTECHNOLOGY (6.0%) Celgene Corp.* 169,800 5,029,476 Charles River Laboratories International, Inc.* 132,200 6,185,638 Genzyme Corp.* 171,200 8,982,864 ImClone Systems, Inc.* 76,800 3,363,840 --------------- 23,561,818 --------------- CHEMICALS (1.7%) Monsanto Co. 152,400 6,515,100 --------------- COMMERCIAL SERVICES & SUPPLIES (3.7%) Certegy, Inc. 101,900 3,602,165 Corporate Executive Board Co. 98,800 6,288,620 Monster Worldwide, Inc.* 168,900 4,737,645 --------------- 14,628,430 --------------- COMMUNICATIONS EQUIPMENT (3.8%) Avaya, Inc.* 349,800 5,037,120 Comverse Technology, Inc.* 227,000 4,685,280 Juniper Networks, Inc.* 192,900 5,133,069 --------------- 14,855,469 --------------- COMPUTERS & PERIPHERALS (4.0%) ATI Technologies, Inc.* 116,900 2,110,045 Lexmark International, Inc. Class A* 80,800 6,715,288 NCR Corp.* 117,500 6,621,125 --------------- 15,446,458 --------------- CONTAINERS & PACKAGING (1.4%) Ball Corp. 137,000 5,459,450 --------------- DIVERSIFIED FINANCIALS (5.6%) American Capital Strategies, Ltd.@ 94,100 2,912,395 Chicago Mercantile Exchange@ 27,400 4,815,002 E*TRADE Financial Corp.* 526,700 6,794,430 eSPEED, Inc. Class A*@ 131,800 1,298,230 Providian Financial Corp.* 384,300 5,975,865 --------------- 21,795,922 --------------- ELECTRONIC EQUIPMENT & INSTRUMENTS (0.9%) Broadcom Corp. Class A* 133,300 3,605,765 ---------------
See Accompanying Notes to Financial Statements. 28
NUMBER OF SHARES VALUE --------------- --------------- COMMON STOCKS ENERGY EQUIPMENT & SERVICES (5.7%) Baker Hughes, Inc. 94,800 $ 4,060,284 BJ Services Co. 90,500 4,615,500 ENSCO International, Inc. 137,500 4,200,625 National-Oilwell, Inc.*@ 143,800 4,847,498 Smith International, Inc.* 77,900 4,524,432 --------------- 22,248,339 --------------- FOOD & DRUG RETAILING (1.1%) Whole Foods Market, Inc. 51,300 4,177,359 --------------- FOOD PRODUCTS (0.7%) J.M. Smucker Co. 61,900 2,754,550 --------------- HEALTHCARE EQUIPMENT & SUPPLIES (3.5%) Beckman Coulter, Inc. 66,300 3,944,850 Fisher Scientific International, Inc.* 77,100 4,422,456 Varian Medical Systems, Inc.* 134,100 5,384,115 --------------- 13,751,421 --------------- HEALTHCARE PROVIDERS & SERVICES (3.5%) AMERIGROUP Corp.*@ 127,600 7,656,000 VCA Antech, Inc.*@ 275,400 6,174,468 --------------- 13,830,468 --------------- HOTELS, RESTAURANTS & LEISURE (5.2%) International Game Technology 189,000 6,244,560 MGM Mirage, Inc.* 152,400 8,199,120 Starwood Hotels & Resorts Worldwide, Inc. 125,500 5,990,115 --------------- 20,433,795 --------------- INSURANCE (4.2%) AMBAC Financial Group, Inc. 98,850 7,716,231 Fidelity National Financial, Inc. 130,000 4,906,200 Genworth Financial, Inc. 166,700 3,977,462 --------------- 16,599,893 --------------- INTERNET SOFTWARE & SERVICES (6.6%) Ask Jeeves, Inc.*@ 147,800 3,810,284 McAfee, Inc.* 203,100 4,915,020 Openwave Systems, Inc.*@ 486,366 5,724,528 SINA Corp.*@ 109,800 3,678,300 VeriSign, Inc.* 283,800 7,614,354 --------------- 25,742,486 --------------- MEDIA (7.1%) DreamWorks Animation SKG, Inc. Class A* 26,000 1,015,300 E.W. Scripps Co. Class A@ 81,800 3,903,496 Getty Images, Inc.* 144,500 8,544,285 Lamar Advertising Co.* 183,700 7,608,854 Radio One, Inc. Class A*@ 234,300 3,432,495 Westwood One, Inc.* 147,000 3,392,760 --------------- 27,897,190 ---------------
See Accompanying Notes to Financial Statements. 29
NUMBER OF SHARES VALUE --------------- --------------- COMMON STOCKS OIL & GAS (1.1%) Newfield Exploration Co.* 74,400 $ 4,330,080 --------------- PERSONAL PRODUCTS (1.6%) Alberto-Culver Co. 136,900 6,141,334 --------------- PHARMACEUTICALS (4.0%) Angiotech Pharmaceuticals, Inc.* 247,000 4,515,160 Sepracor, Inc.*@ 181,900 8,354,667 Valeant Pharmaceuticals International@ 119,400 2,865,600 --------------- 15,735,427 --------------- ROAD & RAIL (1.8%) C.H. Robinson Worldwide, Inc.@ 130,800 7,055,352 --------------- SEMICONDUCTOR EQUIPMENT & PRODUCTS (2.7%) Integrated Circuit Systems, Inc.*@ 173,700 3,916,935 Tessera Technologies, Inc.* 241,200 6,736,716 --------------- 10,653,651 --------------- SOFTWARE (8.5%) Activision, Inc.* 406,700 5,889,016 Adobe Systems, Inc. 157,000 8,796,710 Hyperion Solutions Corp.*@ 127,100 5,100,523 Macromedia, Inc.* 291,100 7,900,454 Quest Software, Inc.*@ 382,600 5,612,742 --------------- 33,299,445 --------------- SPECIALTY RETAIL (1.0%) Williams-Sonoma, Inc.* 104,600 3,992,582 --------------- TEXTILES & APPAREL (3.4%) Coach, Inc.* 140,500 6,551,515 Columbia Sportswear Co.*@ 109,700 6,621,492 --------------- 13,173,007 --------------- WIRELESS TELECOMMUNICATION SERVICES (2.0%) Nextel Partners, Inc. Class A*@ 458,800 7,726,192 --------------- TOTAL COMMON STOCKS (Cost $339,498,961) 376,838,591 --------------- PREFERRED STOCK (0.0%) TELECOMMUNICATIONS (0.0%) Celletra, Ltd. Series C*++ (Cost $7,000,000) 1,102,524 0 ---------------
See Accompanying Notes to Financial Statements. 30
NUMBER OF SHARES VALUE --------------- --------------- SHORT-TERM INVESTMENTS (21.1%) State Street Navigator Prime Fund** 63,071,784 $ 63,071,784 PAR (000) --------------- State Street Bank and Trust Co. Euro Time Deposit, 1.000%, 11/01/04 $ 19,719 19,719,000 --------------- TOTAL SHORT-TERM INVESTMENTS (Cost $82,790,784) 82,790,784 --------------- TOTAL INVESTMENTS AT VALUE (117.4%) (Cost $429,289,745) 459,629,375 LIABILITIES IN EXCESS OF OTHER ASSETS (-17.4%) (68,281,437) --------------- NET ASSETS (100.0%) $ 391,347,938 ===============
* Non-income producing security. ++ Restricted security, not readily marketable; security is valued at fair value as determined in good faith by, or under the direction of, the Board of Directors. @ Security or portion thereof is out on loan. ** Represents security purchased with cash collateral received for securities on loan. See Accompanying Notes to Financial Statements. 31 CREDIT SUISSE SMALL CAP GROWTH FUND SCHEDULE OF INVESTMENTS October 31, 2004
NUMBER OF SHARES VALUE --------------- --------------- COMMON STOCKS (94.8%) AGRICULTURE (1.0%) Delta and Pine Land Co. 35,100 $ 923,832 --------------- BANKS (1.1%) Boston Private Financial Holdings, Inc.@ 41,000 1,006,140 --------------- BIOTECHNOLOGY (2.1%) Martek Biosciences Corp.* 10,300 484,677 Nabi Biopharmaceuticals*@ 78,400 1,085,840 Rigel Pharmaceuticals, Inc.*@ 13,100 314,400 --------------- 1,884,917 --------------- BUILDING PRODUCTS (0.8%) Griffon Corp.* 33,900 754,275 --------------- COMMERCIAL SERVICES & SUPPLIES (0.8%) Universal Technical Institute, Inc.*@ 21,300 698,853 --------------- COMMUNICATIONS EQUIPMENT (1.7%) Harmonic, Inc.*@ 75,500 628,160 InterDigital Communications Corp.*@ 56,100 891,990 --------------- 1,520,150 --------------- COMPUTERS & PERIPHERALS (1.2%) Avid Technology, Inc.*@ 20,500 1,086,090 --------------- CONTAINERS & PACKAGING (1.2%) Crown Holdings, Inc.* 94,500 1,072,575 --------------- DIVERSIFIED FINANCIALS (3.7%) Affiliated Managers Group, Inc.*@ 16,950 946,488 eSPEED, Inc. Class A* 38,400 378,240 Jefferies Group, Inc.@ 26,300 1,055,419 Piper Jaffray Companies, Inc.* 19,900 870,227 --------------- 3,250,374 --------------- ENERGY EQUIPMENT & SERVICES (3.6%) FMC Technologies, Inc.* 36,100 1,091,303 Grey Wolf, Inc.* 230,500 1,193,990 Newpark Resources, Inc.*@ 171,000 928,530 --------------- 3,213,823 --------------- FOOD & DRUG RETAILING (1.0%) Pantry, Inc.* 40,000 919,600 --------------- FOOD PRODUCTS (1.7%) Hain Celestial Group, Inc.*@ 52,800 854,304 John B. Sanfilippo & Son, Inc.* 36,413 656,526 --------------- 1,510,830 --------------- HEALTHCARE EQUIPMENT & SUPPLIES (6.1%) Advanced Neuromodulation Systems, Inc.* 15,000 477,450 Align Technology, Inc.*@ 86,900 901,588 American Medical Systems Holdings, Inc.* 25,100 931,210
See Accompanying Notes to Financial Statements. 32
NUMBER OF SHARES VALUE --------------- --------------- COMMON STOCKS HEALTHCARE EQUIPMENT & SUPPLIES (6.1%) I-Flow Corp.*@ 66,400 $ 918,976 SonoSite, Inc.*@ 25,400 733,679 Vnus Medical Technologies* 2,500 37,575 Wilson Greatbatch Technologies, Inc.*@ 17,200 291,540 Wright Medical Group, Inc.*@ 42,500 1,097,775 --------------- 5,389,793 --------------- HEALTHCARE PROVIDERS & SERVICES (9.4%) Amedisys, Inc.*@ 30,800 931,084 AMERIGROUP Corp.*@ 23,600 1,416,000 Centene Corp.*@ 20,100 953,343 Gentiva Health Services, Inc.*@ 60,300 1,022,989 Kindred Healthcare, Inc.*@ 47,700 1,149,570 Molina Healthcare, Inc.* 17,200 633,304 Psychiatric Solutions, Inc.*@ 51,500 1,310,675 United Surgical Partners International, Inc.*@ 28,000 980,280 --------------- 8,397,245 --------------- HOTELS, RESTAURANTS & LEISURE (2.1%) Carmike Cinemas, Inc.@ 28,100 1,005,980 Panera Bread Co. Class A*@ 24,900 869,757 --------------- 1,875,737 --------------- INSURANCE (1.4%) Direct General Corp.@ 9,000 265,500 Platinum Underwriters Holdings, Ltd. 33,100 968,175 --------------- 1,233,675 --------------- INTERNET & CATALOG RETAIL (2.3%) Coldwater Creek, Inc.*@ 47,949 1,103,786 J. Jill Group, Inc.*@ 52,200 917,676 --------------- 2,021,462 --------------- INTERNET SOFTWARE & SERVICES (10.0%) 24/7 Real Media, Inc.*@ 146,100 511,350 Ask Jeeves, Inc.*@ 42,800 1,103,384 Chordiant Software, Inc.* 254,700 626,562 Digitas, Inc.*@ 140,500 1,264,500 FileNET Corp.*@ 39,600 1,102,068 MatrixOne, Inc.*@ 153,200 873,240 Openwave Systems, Inc.*@ 119,366 1,404,938 SINA Corp.*@ 19,300 646,550 Sohu.com, Inc.*@ 38,400 643,200 webMethods, Inc.*@ 107,400 744,282 --------------- 8,920,074 --------------- IT CONSULTING & SERVICES (1.3%) Titan Corp.* 79,200 1,175,328 ---------------
See Accompanying Notes to Financial Statements. 33
NUMBER OF SHARES VALUE --------------- --------------- COMMON STOCKS LEISURE EQUIPMENT & PRODUCTS (0.9%) RC2 Corp.* 27,900 $ 777,294 --------------- MACHINERY (1.3%) Kennametal, Inc. 21,300 991,089 Wabash National Corp.* 8,000 196,640 --------------- 1,187,729 --------------- MEDIA (3.2%) Aquantive, Inc.*@ 104,200 932,590 Cumulus Media, Inc. Class A* 61,800 1,004,250 Emmis Communications Corp. Class A*@ 49,600 927,520 --------------- 2,864,360 --------------- METALS & MINING (0.9%) GrafTech International, Ltd.*@ 83,500 773,210 --------------- OIL & GAS (3.1%) Denbury Resources, Inc.* 38,900 964,720 Remington Oil & Gas Corp.*@ 36,100 918,384 Stone Energy Corp.* 20,600 848,102 --------------- 2,731,206 --------------- PHARMACEUTICALS (6.5%) Angiotech Pharmaceuticals, Inc.* 54,700 999,916 Impax Laboratories, Inc.*@ 56,300 830,988 Inspire Phamaceuticals, Inc.*@ 66,200 1,036,692 Medicines Co.*@ 46,100 1,228,104 Medicis Pharmaceutical Corp. Class A@ 17,300 703,591 Sepracor, Inc.*@ 20,700 950,751 --------------- 5,750,042 --------------- SEMICONDUCTOR EQUIPMENT & PRODUCTS (5.5%) Asyst Technologies, Inc.*@ 143,300 767,372 Axcelis Technologies, Inc.*@ 52,200 448,920 Cymer, Inc.*@ 25,400 724,408 Entegris, Inc.*@ 69,000 638,595 Tessera Technologies, Inc.*@ 57,700 1,611,561 Trident Microsystems, Inc.* 8,800 116,072 Varian Semiconductor Equipment Associates, Inc.*@ 16,200 560,682 --------------- 4,867,610 --------------- SOFTWARE (10.5%) Activision, Inc.* 96,350 1,395,148 Agile Software Corp.*@ 126,800 1,082,872 Hyperion Solutions Corp.*@ 23,900 959,107 Informatica Corp.*@ 90,500 706,805 Quest Software, Inc.*@ 90,100 1,321,767 Radiant Systems, Inc.* 61,100 312,832 SkillSoft PLC ADR*@ 140,900 965,165 Take-Two Interactive Software, Inc.*@ 20,400 672,384 THQ, Inc.*@ 39,100 738,990 TIBCO Software, Inc.* 120,300 1,169,316 --------------- 9,324,386 ---------------
See Accompanying Notes to Financial Statements. 34
NUMBER OF SHARES VALUE --------------- --------------- COMMON STOCKS SPECIALTY RETAIL (6.8%) Aaron Rents, Inc. 17,100 $ 371,070 Aeropostale, Inc.* 32,750 1,033,262 Cost Plus, Inc.*@ 25,600 826,880 Design Within Reach, Inc.*@ 31,700 508,785 Guitar Center, Inc.*@ 27,200 1,213,936 Hot Topic, Inc.*@ 53,000 1,089,680 Sports Authority, Inc.*@ 39,800 962,364 --------------- 6,005,977 --------------- TEXTILES & APPAREL (3.6%) Deckers Outdoor Corp.*@ 27,000 1,022,220 K-Swiss, Inc. Class A@ 51,100 1,277,500 Warnaco Group, Inc.*@ 45,000 918,000 --------------- 3,217,720 --------------- TOTAL COMMON STOCKS (Cost $77,144,351) 84,354,307 --------------- PREFERRED STOCKS (0.0%) INTERNET SOFTWARE & SERVICES (0.0%) Planetweb, Inc.*++ (Cost $149,913) 27,600 214 --------------- WARRANT (0.0%) ELECTRONIC EQUIPMENT & INSTRUMENTS (0.0%) APW, Ltd. expires 7/31/09*^ (Cost $0) 17 0 --------------- SHORT-TERM INVESTMENTS (33.5%) State Street Navigator Prime Fund** 22,732,706 22,732,706 PAR (000) --------------- State Street Bank and Trust Co. Euro Time Deposit, 1.000%, 11/01/04 $ 7,097 7,097,000 --------------- TOTAL SHORT-TERM INVESTMENTS (Cost $29,829,706) 29,829,706 --------------- TOTAL INVESTMENTS AT VALUE (128.3%) (Cost $107,123,970) 114,184,227 LIABILITIES IN EXCESS OF OTHER ASSETS (-28.3%) (25,185,183) --------------- NET ASSETS (100.0%) $ 88,999,044 ===============
INVESTMENT ABBREVIATION ADR = American Depository Receipt * Non-income producing security. ++ Restricted security, not readily marketable; security is valued at fair value as determined in good faith by, or under the direction of, the Board of Directors. ^ Not readily marketable security; security is valued at fair value as determined in good faith by, or under the direction of, the Board of Directors. @ Security or portion thereof is out on loan. ** Represents security purchased with cash collateral received for securities on loan. See Accompanying Notes to Financial Statements. 35 CREDIT SUISSE FUNDS STATEMENTS OF ASSETS AND LIABILITIES October 31, 2004
CAPITAL MID-CAP SMALL CAP APPRECIATION FUND GROWTH FUND GROWTH FUND ------------------ ------------------ ------------------ ASSETS Investments at value, including collateral for securities on loan of $18,946,701, $63,071,784 and $22,732,706, respectively (Cost $429,538,327, $429,289,745 and $107,123,970, respectively) (Note 1) $ 473,183,105(1) $ 459,629,375(2) $ 114,184,227(3) Cash 577 -- 102 Receivable for investments sold 5,829,706 7,799,411 1,250,819 Receivable for fund shares sold 254,158 768,620 176,520 Dividend and interest receivable 42,805 1,643 7,882 Prepaid expenses and other assets 50,439 63,495 55,186 ------------------ ------------------ ------------------ Total Assets 479,360,790 468,262,544 115,674,736 ------------------ ------------------ ------------------ LIABILITIES Advisory fee payable (Note 2) 268,025 293,262 32,517 Administrative services fee payable (Note 2) 112,720 96,305 26,221 Shareholder servicing/Distribution fee payable (Note 2) 16,331 21,201 19,142 Payable upon return of securities loaned (Note 1) 18,946,701 63,071,784 22,732,706 Payable for investments purchased 6,514,807 9,005,479 1,000,154 Payable due to custodian -- 2,403,166 -- Payable for fund shares redeemed 604,327 1,445,375 2,708,492 Trustees'/Directors' fee payable 4,268 4,268 4,268 Other accrued expenses payable 608,572 573,766 152,192 ------------------ ------------------ ------------------ Total Liabilities 27,075,751 76,914,606 26,675,692 ------------------ ------------------ ------------------ NET ASSETS Capital stock, $0.001 par value (Note 6) 29,690 14,024 4,793 Paid-in capital (Note 6) 794,555,536 583,174,035 91,968,957 Accumulated net realized loss on investments (385,944,965) (222,179,752) (10,034,964) Net unrealized appreciation from investments 43,644,778 30,339,631 7,060,258 ------------------ ------------------ ------------------ Net Assets $ 452,285,039 $ 391,347,938 $ 88,999,044 ================== ================== ================== COMMON SHARES Net assets $ 433,681,274 $ 364,298,385 $ 78,130,935 Shares outstanding 28,427,319 12,992,230 4,207,385 ------------------ ------------------ ------------------ Net asset value, offering price and redemption price per share $ 15.26 $ 28.04 $ 18.57 ================== ================== ================== ADVISOR SHARES Net assets $ 14,723,020 $ 26,474,182 $ 943 Shares outstanding 1,004,675 1,011,089 51 ------------------ ------------------ ------------------ Net asset value, offering price and redemption price per share $ 14.65 $ 26.18 $ 18.53 ================== ================== ==================
See Accompanying Notes to Financial Statements. 36
CAPITAL MID-CAP SMALL CAP APPRECIATION FUND GROWTH FUND GROWTH FUND ------------------ ------------------ ------------------ A SHARES Net assets $ 2,489,527 $ 567,117 $ 10,855,806 Shares outstanding 164,384 20,420 584,744 ------------------ ------------------ ------------------ Net asset value and redemption price per share $ 15.14 $ 27.77 $ 18.57 ================== ================== ================== Maximum offering price per share (net asset value/(1-5.75%)) $ 16.06 $ 29.46 $ 19.70 ================== ================== ================== B SHARES Net assets $ 542,560 $ 7,303 $ 10,420 Shares outstanding 36,618 264 564 ------------------ ------------------ ------------------ Net asset value and offering price per share $ 14.82 $ 27.64 $ 18.48 ================== ================== ================== C SHARES Net assets $ 848,658 $ 951 $ 940 Shares outstanding 57,290 34 50 ------------------ ------------------ ------------------ Net asset value and offering price per share $ 14.81 $ 27.67 $ 18.48 ================== ================== ==================
(1) Including $18,522,888 of securities on loan. (2) Including $61,531,421 of securities on loan. (3) Including $22,141,843 of securities on loan. See Accompanying Notes to Financial Statements. 37 STATEMENTS OF OPERATIONS For the Year Ended October 31, 2004
CAPITAL MID-CAP SMALL CAP APPRECIATION FUND GROWTH FUND GROWTH FUND ------------------ ------------------ ------------------ INVESTMENT INCOME (Note 1) Dividends $ 2,861,837 $ 1,141,657 $ 92,725 Interest 81,044 168,803 52,376 Securities lending 17,177 68,165 21,803 Foreign taxes (14,651) -- -- ------------------ ------------------ ------------------ Total investment income 2,945,407 1,378,625 166,904 ------------------ ------------------ ------------------ EXPENSES Investment advisory fees (Note 2) 3,498,568 3,887,905 907,109 Administrative services fees (Note 2) 792,942 687,842 153,205 Shareholder servicing/Distribution fees (Note 2) Common Class -- -- 208,689 Advisor Class 82,081 164,784 2 Class A 4,522 945 18,081 Class B 5,592 42 15 Class C 6,229 7 7 Transfer agent fees (Note 2) 1,102,924 1,113,076 284,084 Printing fees (Note 2) 74,472 73,924 29,808 Registration fees 71,453 71,412 63,566 Insurance expense 57,282 32,207 17,966 Audit fees 50,374 37,002 16,573 Custodian fees 43,821 41,971 28,313 Legal fees 34,148 51,411 48,497 Trustees'/Directors' fees 16,872 16,872 16,872 Commitment fees (Note 3) 14,105 12,296 2,663 Miscellaneous expense 20,346 19,966 9,267 ------------------ ------------------ ------------------ Total expenses 5,875,731 6,211,662 1,804,717 Less: fees waived (Note 2) -- -- (534,747) ------------------ ------------------ ------------------ Net expenses 5,875,731 6,211,662 1,269,970 ------------------ ------------------ ------------------ Net investment loss (2,930,324) (4,833,037) (1,103,066) ------------------ ------------------ ------------------ NET REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENTS Net realized gain from investments 18,748,246 80,816,785 9,479,818 Net change in unrealized appreciation (depreciation) from investments 2,165,046 (57,342,636) (7,516,561) ------------------ ------------------ ------------------ Net realized and unrealized gain from investments 20,913,292 23,474,149 1,963,257 ------------------ ------------------ ------------------ Net increase in net assets resulting from operations $ 17,982,968 $ 18,641,112 $ 860,191 ================== ================== ==================
See Accompanying Notes to Financial Statements. 38 This page intentionally left blank STATEMENTS OF CHANGES IN NET ASSETS
CAPITAL APPRECIATION FUND -------------------------------------- FOR THE YEAR FOR THE YEAR ENDED ENDED OCTOBER 31, 2004 OCTOBER 31, 2003 ----------------- ----------------- FROM OPERATIONS Net investment loss $ (2,930,324) $ (2,131,927) Net realized gain (loss) from investments 18,748,246 (33,954,159) Net change in unrealized appreciation (depreciation) from investments 2,165,046 120,908,900 ----------------- ----------------- Net increase in net assets resulting from operations 17,982,968 84,822,814 ----------------- ----------------- FROM CAPITAL SHARE TRANSACTIONS (Note 6) Proceeds from sale of shares 64,577,142 86,270,380 Reinvestment of dividends and distributions -- -- Net asset value of shares redeemed (164,242,663) (220,631,129) ----------------- ----------------- Net increase (decrease) in net assets from capital share transactions (99,665,521) (134,360,749) ----------------- ----------------- Net increase (decrease) in net assets (81,682,553) (49,537,935) NET ASSETS Beginning of year 533,967,592 583,505,527 ----------------- ----------------- End of year $ 452,285,039 $ 533,967,592 ================= =================
See Accompanying Notes to Financial Statements. 40
MID-CAP GROWTH FUND -------------------------------------- FOR THE YEAR FOR THE YEAR ENDED ENDED OCTOBER 31, 2004 OCTOBER 31, 2003 ----------------- ----------------- FROM OPERATIONS Net investment loss $ (4,833,037) $ (4,237,713) Net realized gain (loss) from investments 80,816,785 13,936,296 Net change in unrealized appreciation (depreciation) from investments (57,342,636) 125,732,873 ----------------- ----------------- Net increase in net assets resulting from operations 18,641,112 135,431,456 ----------------- ----------------- FROM CAPITAL SHARE TRANSACTIONS (Note 6) Proceeds from sale of shares 89,263,585 101,028,267 Reinvestment of dividends and distributions -- -- Net asset value of shares redeemed (164,214,779) (189,580,871) ----------------- ----------------- Net increase (decrease) in net assets from capital share transactions (74,951,194) (88,552,604) ----------------- ----------------- Net increase (decrease) in net assets (56,310,082) 46,878,852 NET ASSETS Beginning of year 447,658,020 400,779,168 ----------------- ----------------- End of year $ 391,347,938 $ 447,658,020 ================= ================= SMALL CAP GROWTH FUND -------------------------------------- FOR THE YEAR FOR THE YEAR ENDED ENDED OCTOBER 31, 2004 OCTOBER 31, 2003 ----------------- ----------------- FROM OPERATIONS Net investment loss $ (1,103,066) $ (611,652) Net realized gain (loss) from investments 9,479,818 (1,191,044) Net change in unrealized appreciation (depreciation) from investments (7,516,561) 21,978,881 ----------------- ----------------- Net increase in net assets resulting from operations 860,191 20,176,185 ----------------- ----------------- FROM CAPITAL SHARE TRANSACTIONS (Note 6) Proceeds from sale of shares 48,554,040 41,262,405 Reinvestment of dividends and distributions -- -- Net asset value of shares redeemed (38,571,104) (26,522,563) ----------------- ----------------- Net increase (decrease) in net assets from capital share transactions 9,982,936 14,739,842 ----------------- ----------------- Net increase (decrease) in net assets 10,843,127 34,916,027 NET ASSETS Beginning of year 78,155,917 43,239,890 ----------------- ----------------- End of year $ 88,999,044 $ 78,155,917 ================= =================
See Accompanying Notes to Financial Statements. 41 CREDIT SUISSE CAPITAL APPRECIATION FUND FINANCIAL HIGHLIGHTS (For a Common Class Share of the Fund Outstanding Throughout Each Year)
FOR THE YEAR ENDED OCTOBER 31, ------------------------------------------------------------------------------ 2004 2003 2002 2001 2000 ---------- ---------- ---------- ---------- ------------ PER SHARE DATA Net asset value, beginning of year $ 14.75 $ 12.53 $ 16.23 $ 30.57 $ 25.82 ---------- ---------- ---------- ---------- ------------ INVESTMENT OPERATIONS Net investment loss (0.09)(1) (0.05)(1) (0.07)(1) (0.02) (0.05) Net gain (loss) on investments (both realized and unrealized) 0.60 2.27 (3.63) (10.04) 7.72 ---------- ---------- ---------- ---------- ------------ Total from investment operations 0.51 2.22 (3.70) (10.06) 7.67 ---------- ---------- ---------- ---------- ------------ LESS DIVIDENDS AND DISTRIBUTIONS Dividends from net investment income -- -- -- -- -- Distributions from net realized gains -- -- 0.00(2) (4.28) (2.92) ---------- ---------- ---------- ---------- ------------ Total dividends and distributions -- -- -- (4.28) (2.92) ---------- ---------- ---------- ---------- ------------ NET ASSET VALUE, END OF YEAR $ 15.26 $ 14.75 $ 12.53 $ 16.23 $ 30.57 ========== ========== ========== ========== ============ Total return(3) 3.46% 17.72% (22.79)% (37.59)% 31.50% RATIOS AND SUPPLEMENTAL DATA Net assets, end of year (000s omitted) $ 433,681 $ 514,668 $ 566,064 $ 899,234 $ 1,618,147 Ratio of expenses to average net assets(4) 1.16% 1.15% 1.11% 0.99% 0.98% Ratio of net investment loss to average net assets (0.57)% (0.39)% (0.45)% (0.09)% (0.19)% Portfolio turnover rate 70% 97% 50% 100% 140%
(1) Per share information is calculated using the average shares outstanding method. (2) This represents less than $ 0.01 per share. (3) Total returns are historical and assume changes in share price and reinvestment of all dividends and distributions. (4) Interest earned on uninvested cash balances may be used to offset portions of the transfer agent expense. These arrangements resulted in a reduction to the Common Class shares' net expense ratio by .02% for the year ended October 31, 2000. The Common Class shares' operating expense ratio after reflecting these arrangements was .96% for the year ended October 31, 2000. For the years ended October 31, 2004, 2003, 2002 and 2001, there was no effect on the net operating expense ratio because of transfer agent credits. See Accompanying Notes to Financial Statements. 42 (For an Advisor Class Share of the Fund Outstanding Throughout Each Year)
FOR THE YEAR ENDED OCTOBER 31, ---------------------------------------------------------------------------- 2004 2003 2002 2001 2000 ---------- ---------- ---------- ---------- ---------- PER SHARE DATA Net asset value, beginning of year $ 14.24 $ 12.16 $ 15.82 $ 29.88 $ 25.28 ---------- ---------- ---------- ---------- ---------- INVESTMENT OPERATIONS Net investment loss (0.16)(1) (0.11)(1) (0.14)(1) (0.12) (0.21) Net gain (loss) on investments (both realized and unrealized) 0.57 2.19 (3.52) (9.81) 7.58 ---------- ---------- ---------- ---------- ---------- Total from investment operations 0.41 2.08 (3.66) (9.93) 7.37 ---------- ---------- ---------- ---------- ---------- LESS DISTRIBUTIONS Distributions from net realized gains -- -- 0.00(2) (4.13) (2.77) ---------- ---------- ---------- ---------- ---------- NET ASSET VALUE, END OF YEAR $ 14.65 $ 14.24 $ 12.16 $ 15.82 $ 29.88 ========== ========== ========== ========== ========== Total return(3) 2.88% 17.11% (23.13)% (37.91)% 30.83% RATIOS AND SUPPLEMENTAL DATA Net assets, end of year (000s omitted) $ 14,723 $ 17,380 $ 16,693 $ 25,882 $ 34,058 Ratio of expenses to average net assets(4) 1.66% 1.65% 1.61% 1.49% 1.48% Ratio of net investment loss to average net assets (1.07)% (0.90)% (0.96)% (0.62)% (0.69)% Portfolio turnover rate 70% 97% 50% 100% 140%
(1) Per share information is calculated using the average shares outstanding method. (2) This represents less than $ 0.01 per share. (3) Total returns are historical and assume changes in share price and reinvestment of all dividends and distributions. (4) Interest earned on uninvested cash balances may be used to offset portions of the transfer agent expense. These arrangements resulted in a reduction to the Advisor Class shares' net expense ratio by .02% for the year ended October 31, 2000. The Advisor Class shares' operating expense ratio after reflecting these arrangements was 1.46% for the year ended October 31, 2000. For the years ended October 31, 2004, 2003, 2002 and 2001, there was no effect on the net operating expense ratio because of transfer agent credits. See Accompanying Notes to Financial Statements. 43 (For a Class A Share of the Fund Outstanding Throughout Each Period)
FOR THE YEAR ENDED OCTOBER 31 ---------------------------------------- 2004 2003 2002(1) ---------- ---------- ---------- PER SHARE DATA Net asset value, beginning of period $ 14.68 $ 12.50 $ 17.75 ---------- ---------- ---------- INVESTMENT OPERATIONS Net investment loss(2) (0.12) (0.09) (0.09) Net gain (loss) on investments (both realized and unrealized) 0.58 2.27 (5.16) ---------- ---------- ---------- Total from investment operations 0.46 2.18 (5.25) ---------- ---------- ---------- LESS DISTRIBUTIONS Distributions from net realized gains -- -- 0.00(3) ---------- ---------- ---------- NET ASSET VALUE, END OF PERIOD $ 15.14 $ 14.68 $ 12.50 ========== ========== ========== Total return(4) 3.13% 17.44% (29.57)% RATIOS AND SUPPLEMENTAL DATA Net assets, end of period (000s omitted) $ 2,490 $ 1,152 $ 450 Ratio of expenses to average net assets(5) 1.41% 1.40% 1.40%(6) Ratio of net investment loss to average net assets (0.82)% (0.69)% (0.77)%(6) Portfolio turnover rate 70% 97% 50%
(1) For the period November 30, 2001 (inception date) through October 31, 2002. (2) Per share information is calculated using the average shares outstanding method. (3) This represents less than $ 0.01 per share. (4) Total returns are historical and assume changes in share price, reinvestment of all dividends and distributions, and no sales charge. Total returns for periods less than one year are not annualized. (5) Interest earned on uninvested cash balances may be used to offset portions of the transfer agent expense. For the years ended October 31, 2004 and 2003 and for the period ended October 31, 2002, there was no effect on the net operating expense ratio because of transfer agent credits. (6) Annualized. See Accompanying Notes to Financial Statements. 44 (For a Class B Share of the Fund Outstanding Throughout Each Period)
FOR THE YEAR ENDED OCTOBER 31 ---------------------------------------- 2004 2003 2002(1) ---------- ---------- ---------- PER SHARE DATA Net asset value, beginning of period $ 14.47 $ 12.41 $ 17.75 ---------- ---------- ---------- INVESTMENT OPERATIONS Net investment loss(2) (0.23) (0.19) (0.18) Net gain (loss) on investments (both realized and unrealized) 0.58 2.25 (5.16) ---------- ---------- ---------- Total from investment operations 0.35 2.06 (5.34) ---------- ---------- ---------- LESS DISTRIBUTIONS Distributions from net realized gains -- -- 0.00(3) ---------- ---------- ---------- NET ASSET VALUE, END OF PERIOD $ 14.82 $ 14.47 $ 12.41 ========== ========== ========== Total return(4) 2.42% 16.60% (30.08)% RATIOS AND SUPPLEMENTAL DATA Net assets, end of period (000s omitted) $ 543 $ 545 $ 206 Ratio of expenses to average net assets(5) 2.16% 2.15% 2.15%(6) Ratio of net investment loss to average net assets (1.57)% (1.44)% (1.51)%(6) Portfolio turnover rate 70% 97% 50%
(1) For the period November 30, 2001 (inception date) through October 31, 2002. (2) Per share information is calculated using the average shares outstanding method. (3) This represents less than $ 0.01 per share. (4) Total returns are historical and assume changes in share price, reinvestment of all dividends and distributions, and no sales charge. Total returns for periods less than one year are not annualized. (5) Interest earned on uninvested cash balances may be used to offset portions of the transfer agent expense. For the years ended October 31, 2004 and 2003 and for the period ended October 31, 2002, there was no effect on the net operating expense ratio because of transfer agent credits. (6) Annualized. See Accompanying Notes to Financial Statements. 45 (For a Class C Share of the Fund Outstanding Throughout Each Period)
FOR THE YEAR ENDED OCTOBER 31 ---------------------------------------- 2004 2003 2002(1) ---------- ---------- ---------- PER SHARE DATA Net asset value, beginning of period $ 14.47 $ 12.41 $ 17.75 ---------- ---------- ---------- INVESTMENT OPERATIONS Net investment loss(2) (0.23) (0.19) (0.18) Net gain (loss) on investments (both realized and unrealized) 0.57 2.25 (5.16) ---------- ---------- ---------- Total from investment operations 0.34 2.06 (5.34) ---------- ---------- ---------- LESS DISTRIBUTIONS Distributions from net realized gains -- -- 0.00(3) ---------- ---------- ---------- NET ASSET VALUE, END OF PERIOD $ 14.81 $ 14.47 $ 12.41 ========== ========== ========== Total return(4) 2.35% 16.60% (30.08)% RATIOS AND SUPPLEMENTAL DATA Net assets, end of period (000s omitted) $ 849 $ 223 $ 93 Ratio of expenses to average net assets(5) 2.16% 2.15% 2.14%(6) Ratio of net investment loss to average net assets (1.57)% (1.44)% (1.49)%(6) Portfolio turnover rate 70% 97% 50%
(1) For the period November 30, 2001 (inception date) through October 31, 2002. (2) Per share information is calculated using the average shares outstanding method. (3) This represents less than $0.01 per share. (4) Total returns are historical and assume changes in share price, reinvestment of all dividends and distributions, and no sales charge. Total returns for periods less than one year are not annualized. (5) Interest earned on uninvested cash balances may be used to offset portions of the transfer agent expense. For the years ended October 31, 2004, 2003 and 2002, there was no effect on the net operating expense ratio because of transfer agent credits. (6) Annualized. See Accompanying Notes to Financial Statements. 46 CREDIT SUISSE MID-CAP GROWTH FUND FINANCIAL HIGHLIGHTS (For a Common Class Share of the Fund Outstanding Throughout Each Year)
FOR THE YEAR ENDED OCTOBER 31, ------------------------------------------------------------------------------ 2004 2003 2002 2001 2000 ---------- ---------- ---------- ---------- ------------ PER SHARE DATA Net asset value, beginning of year $ 26.79 $ 18.98 $ 23.60 $ 50.24 $ 43.73 ---------- ---------- ---------- ---------- ------------ INVESTMENT OPERATIONS Net investment loss (0.30)(1) (0.22)(1) (0.23)(1) (0.26) (0.33) Net gain (loss) on investments (both realized and unrealized) 1.55 8.03 (4.39) (17.89) 13.07 ---------- ---------- ---------- ---------- ------------ Total from investment operations 1.25 7.81 (4.62) (18.15) 12.74 ---------- ---------- ---------- ---------- ------------ LESS DISTRIBUTIONS Distributions from net realized gains -- -- 0.00(2) (8.49) (6.23) ---------- ---------- ---------- ---------- ------------ NET ASSET VALUE, END OF YEAR $ 28.04 $ 26.79 $ 18.98 $ 23.60 $ 50.24 ========== ========== ========== ========== ============ Total return(3) 4.67% 41.15% (19.57)% (42.61)% 30.60% RATIOS AND SUPPLEMENTAL DATA Net assets, end of year (000s omitted) $ 364,298 $ 407,262 $ 357,872 $ 877,983 $ 2,114,737 Ratio of expenses to average net assets(4) 1.40% 1.38% 1.35% 1.28% 1.19% Ratio of net investment loss to average net assets (1.08)% (1.04)% (0.98)% (0.73)% (0.65)% Portfolio turnover rate 106% 68% 67% 177% 191%
(1) Per share information is calculated using the average shares outstanding method. (2) This represents less than $0.01 per share. (3) Total returns are historical and assume changes in share price and reinvestment of all dividends and distributions. (4) Interest earned on uninvested cash balances may be used to offset portions of the transfer agent expense. These arrangements resulted in a reduction to the Common Class shares' net expense ratio by .02% for the year ended October 31, 2000. The Common Class shares' operating expense ratio after reflecting these arrangements was 1.17% for the year ended October 31, 2000. For the years ended October 31, 2004, 2003, 2002 and 2001, there was no effect on the net operating expense ratio because of transfer agent credits. See Accompanying Notes to Financial Statements. 47 (For an Advisor Class Share of the Fund Outstanding Throughout Each Year)
FOR THE YEAR ENDED OCTOBER 31, ---------------------------------------------------------------------------- 2004 2003 2002 2001 2000 ---------- ---------- ---------- ---------- ---------- PER SHARE DATA Net asset value, beginning of year $ 25.14 $ 17.90 $ 22.38 $ 48.02 $ 41.99 ---------- ---------- ---------- ---------- ---------- INVESTMENT OPERATIONS Net investment loss (0.41)(1) (0.31)(1) (0.33)(1) (0.46) (0.61) Net gain (loss) on investments (both realized and unrealized) 1.45 7.55 (4.15) (16.96) 12.61 ---------- ---------- ---------- ---------- ---------- Total from investment operations 1.04 7.24 (4.48) (17.42) 12.00 ---------- ---------- ---------- ---------- ---------- LESS DISTRIBUTIONS Distributions from net realized gains -- -- 0.00(2) (8.22) (5.97) ---------- ---------- ---------- ---------- ---------- NET ASSET VALUE, END OF YEAR $ 26.18 $ 25.14 $ 17.90 $ 22.38 $ 48.02 ========== ========== ========== ========== ========== Total return(3) 4.14% 40.45% (20.01)% (42.88)% 29.96% RATIOS AND SUPPLEMENTAL DATA Net assets, end of year (000s omitted) $ 26,474 $ 40,322 $ 42,906 $ 101,690 $ 277,802 Ratio of expenses to average net assets(4) 1.90% 1.88% 1.85% 1.78% 1.69% Ratio of net investment loss to average net assets (1.58)% (1.53)% (1.49)% (1.23)% (1.15)% Portfolio turnover rate 106% 68% 67% 177% 191%
(1) Per share information is calculated using the average shares outstanding method. (2) This represents less than $ 0.01 per share. (3) Total returns are historical and assume changes in share price and reinvestment of all dividends and distributions. (4) Interest earned on uninvested cash balances may be used to offset portions of the transfer agent expense. These arrangements resulted in a reduction to the Advisor Class shares' net expense ratio by .02% for the year ended October 31, 2000. The Advisor Class shares' operating expense ratio after reflecting these arrangements was 1.67% for the year ended October 31, 2000. For the years ended October 31, 2004, 2003, 2002 and 2001, there was no effect on the net operating expense ratio because of transfer agent credits. See Accompanying Notes to Financial Statements. 48 (For a Class A Share of the Fund Outstanding Throughout Each Period)
FOR THE YEAR ENDED OCTOBER 31 ---------------------------------------- 2004 2003 2002(1) ---------- ---------- ---------- PER SHARE DATA Net asset value, beginning of period $ 26.60 $ 18.90 $ 25.92 ---------- ---------- ---------- INVESTMENT OPERATIONS Net investment loss(2) (0.38) (0.33) (0.28) Net gain (loss) on investments (both realized and unrealized) 1.55 8.03 (6.74) ---------- ---------- ---------- Total from investment operations 1.17 7.70 (7.02) ---------- ---------- ---------- LESS DISTRIBUTIONS Distributions from net realized gains -- -- 0.00(3) ---------- ---------- ---------- NET ASSET VALUE, END OF PERIOD $ 27.77 $ 26.60 $ 18.90 ========== ========== ========== Total return(4) 4.40% 40.74% (27.08)% RATIOS AND SUPPLEMENTAL DATA Net assets, end of period (000s omitted) $ 567 $ 75 $ 1 Ratio of expenses to average net assets(5) 1.65% 1.63% 1.71%(6) Ratio of net investment loss to average net assets (1.33)% (1.36)% (1.35)%(6) Portfolio turnover rate 106% 68% 67%
(1) For the period November 30, 2001 (inception date) through October 31, 2002. (2) Per share information is calculated using the average shares outstanding method. (3) This represents less than $0.01 per share. (4) Total returns are historical and assume changes in share price, reinvestment of all dividends and distributions and no sales charge. Total returns for periods less than one year are not annualized. (5) Interest earned on uninvested cash balances may be used to offset portions of the transfer agent expense. For the years ended October 31, 2004 and 2003 and for the period ended October 31, 2002, there was no effect on the net operating expense ratio because of transfer agent credits. (6) Annualized. See Accompanying Notes to Financial Statements. 49 (For a Class B and Class C Share of the Fund Outstanding Throughout the Period)
FOR THE PERIOD ENDED OCTOBER 31, 2004(1) ---------------------------------------- CLASS B CLASS C ----------- ----------- PER SHARE DATA Net asset value, beginning of period $ 29.10 $ 29.10 ----------- ----------- INVESTMENT OPERATIONS Net investment loss(2) (0.38) (0.38) Net loss on investments (both realized and unrealized) (1.08) (1.05) ----------- ----------- Total from investment operations (1.46) (1.43) ----------- ----------- NET ASSET VALUE, END OF PERIOD $ 27.64 $ 27.67 =========== =========== Total return(3) (5.02)% (4.91)% RATIOS AND SUPPLEMENTAL DATA Net assets, end of period (000s omitted) $ 7 $ 1 Ratio of expenses to average net assets(4), (5) 2.40% 2.40% Ratio of net investment loss to average net assets(5) (2.08)% (2.08)% Portfolio turnover rate 106% 106%
(1) For the period February 27, 2004 (inception date) through October 31, 2004. (2) Per share information is calculated using the average shares outstanding method. (3) Total returns are historical and assume changes in share price, reinvestment of all dividends and distributions and no sales charge. Total returns for periods less than one year are not annualized. (4) Interest earned on uninvested cash balances may be used to offset portions of the transfer agent expense. For the period ended October 31, 2004, there was no effect on the net operating expense ratio because of transfer agent credits. (5) Annualized. See Accompanying Notes to Financial Statements. 50 CREDIT SUISSE SMALL CAP GROWTH FUND FINANCIAL HIGHLIGHTS (For a Common Class Share of the Fund Outstanding Throughout Each Year)
FOR THE YEAR ENDED OCTOBER 31, ---------------------------------------------------------------------------- 2004 2003 2002 2001 2000 ---------- ---------- ---------- ---------- ---------- PER SHARE DATA Net asset value, beginning of year $ 18.14 $ 12.58 $ 15.38 $ 23.11 $ 16.60 ---------- ---------- ---------- ---------- ---------- INVESTMENT OPERATIONS Net investment loss (0.23)(1) (0.18)(1) (0.18)(1) (0.18) (0.13) Net gain (loss) on investments (both realized and unrealized) 0.66 5.74 (2.62) (7.55) 7.28 ---------- ---------- ---------- ---------- ---------- Total from investment operations 0.43 5.56 (2.80) (7.73) 7.15 ---------- ---------- ---------- ---------- ---------- LESS DISTRIBUTIONS Distributions from net realized gains -- -- -- -- (0.64) ---------- ---------- ---------- ---------- ---------- NET ASSET VALUE, END OF YEAR $ 18.57 $ 18.14 $ 12.58 $ 15.38 $ 23.11 ========== ========== ========== ========== ========== Total return(2) 2.37% 44.20% (18.21)% (33.45)% 43.65% RATIOS AND SUPPLEMENTAL DATA Net assets, end of year (000s omitted) $ 78,131 $ 77,236 $ 42,918 $ 36,445 $ 47,900 Ratio of expenses to average net assets(3) 1.40% 1.40% 1.40% 1.40% 1.42% Ratio of net investment loss to average net assets (1.22)% (1.23)% (1.18)% (1.04)% (0.80)% Decrease reflected in above operating expense ratios due to waivers/reimbursements 0.59% 0.71% 0.98% 0.54% 0.56% Portfolio turnover rate 100% 69% 72% 74% 94%
(1) Per share information is calculated using the average shares outstanding method. (2) Total returns are historical and assume changes in share price and reinvestment of all dividends and distributions. Had certain expenses not been reduced during the period shown, total returns would have been lower. (3) Interest earned on uninvested cash balances may be used to offset portions of the transfer agent expense. These arrangements resulted in a reduction to the Common Class shares' net expense ratio by .02% for the year ended October 31, 2000. The Common Class shares' operating expense ratio after reflecting these arrangements was 1.40% for the year ended October 31, 2000. For the years ended October 31, 2004, 2003, 2002 and 2001, there was no effect on the net operating expense ratio because of transfer agent credits. See Accompanying Notes to Financial Statements. 51 (For an Advisor Class Share of the Fund Outstanding Throughout the Period)
FOR THE PERIOD ENDED OCTOBER 31, 2004(1) ------------------- PER SHARE DATA Net asset value, beginning of period $ 19.65 ---------- INVESTMENT OPERATIONS Net investment loss(2) (0.20) Net loss on investments (both realized and unrealized) (0.92) ---------- Total from investment operations (1.12) ---------- NET ASSET VALUE, END OF PERIOD $ 18.53 ========== Total return(3) (5.70)% RATIOS AND SUPPLEMENTAL DATA Net assets, end of period (000s omitted) $ 1 Ratio of expenses to average net assets(4), (5) 1.65% Ratio of net investment loss to average net assets(5) (1.47)% Decrease reflected in above operating expense ratios due to waivers/reimbursements(5) 0.59% Portfolio turnover rate 100%
(1) For the period February 27, 2004 (inception date) through October 31, 2004. (2) Per share information is calculated using the average shares outstanding method. (3) Total returns are historical and assume changes in share price and reinvestment of all dividends and distributions. Had certain expenses not been reduced during the period shown, total returns would have been lower. Total returns for periods less than one year are not annualized. (4) Interest earned on uninvested cash balances may be used to offset portions of the transfer agent expense. For the period ended October 31, 2004, there was no effect on the net operating expense ratio because of transfer agent credits. (5) Annualized. See Accompanying Notes to Financial Statements. 52 (For a Class A, Class B and Class C Share of the Fund Outstanding Throughout Each Period)
FOR THE YEAR ENDED OCTOBER 31, FOR THE PERIOD ENDED ---------------------------------------- OCTOBER 31, 2004(2) 2004 2003 2002(1) ---------------------------- CLASS A CLASS A CLASS A CLASS B CLASS C ---------- ---------- ---------- ---------- ---------- PER SHARE DATA Net asset value, beginning of period $ 18.14 $ 12.57 $ 16.88 $ 19.65 $ 19.65 ---------- ---------- ---------- ---------- ---------- INVESTMENT OPERATIONS Net investment loss(3) (0.23) (0.18) (0.15) (0.24) (0.24) Net gain (loss) on investments (both realized and unrealized) 0.66 5.75 (4.16) (0.93) (0.93) ---------- ---------- ---------- ---------- ---------- Total from investment operations 0.43 5.57 (4.31) (1.17) (1.17) ---------- ---------- ---------- ---------- ---------- NET ASSET VALUE, END OF PERIOD $ 18.57 $ 18.14 $ 12.57 $ 18.48 $ 18.48 ========== ========== ========== ========== ========== Total return(4) 2.37% 44.31% (25.53)% (5.95)% (5.95)% RATIOS AND SUPPLEMENTAL DATA Net assets, end of period (000s omitted) $ 10,856 $ 920 $ 322 $ 10 $ 1 Ratio of expenses to average net assets(5) 1.40% 1.40% 1.40%(6) 2.15%(6) 2.15%(6) Ratio of net investment loss to average net assets (1.21)% (1.24)% (1.14)%(6) (1.97)%(6) (1.97)%(6) Decrease reflected in above operating expense ratios due to waivers/ reimbursements 0.59% 0.71% 1.13%(6) 0.59%(6) 0.59%(6) Portfolio turnover rate 100% 69% 72% 100% 100%
(1) For the period November 30, 2001 (inception date) through October 31, 2002. (2) For the period February 27, 2004 (inception date) through October 31, 2004. (3) Per share information is calculated using the average shares outstanding method. (4) Total returns are historical and assume changes in share price, reinvestment of all dividends and distributions and no sales charge. Had certain expenses not been reduced during the periods shown, total returns would have been lower. Total returns for periods of less than one year are not annualized. (5) Interest earned on uninvested cash balances may be used to offset portions of the transfer agent expense. For the years ended October 31, 2004 and 2003 and for the period ended October 31, 2002, there was no effect on the net operating expense ratio because of transfer agent credits. (6) Annualized. See Accompanying Notes to Financial Statements. 53 CREDIT SUISSE FUNDS NOTES TO FINANCIAL STATEMENTS October 31, 2004 NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Credit Suisse Funds covered in this report are Credit Suisse Capital Appreciation Fund ("Capital Appreciation"), Credit Suisse Mid-Cap Growth Fund, formerly Credit Suisse Emerging Growth Fund, ("Mid-Cap Growth") and Credit Suisse Small Cap Growth Fund ("Small Cap Growth"), which are registered under the Investment Company Act of 1940, as amended (the "1940 Act"), as diversified open-end management investment companies. Capital Appreciation was organized under the laws of the Commonwealth of Massachusetts as a business trust on January 20, 1987. Mid-Cap Growth and Small Cap Growth were incorporated under the laws of the State of Maryland on November 12, 1987 and October 31, 1996, respectively. Investment objectives for each Fund are as follows: Capital Appreciation seeks long-term capital appreciation, Mid-Cap Growth seeks maximum capital appreciation, and Small Cap Growth seeks capital growth. Capital Appreciation, Mid-Cap Growth and Small Cap Growth offer five classes of shares, Common Class, Advisor Class, Class A, Class B, and Class C shares. The Funds' Common Class shares are closed to new investors, other than (1) investors in employee retirement, stock, bonus, pension or profit-sharing plans, (2) investment advisory clients of Credit Suisse Asset Management, LLC ("CSAM"), (3) certain registered investment advisers ("RIAs"), (4) certain broker-dealers and RIAs with clients participating in comprehensive fee programs and (5) employees of CSAM or its affiliates and current and former Directors or Trustees of funds advised by CSAM or its affiliates. Any Common Class shareholder as of the close of business on December 12, 2001 can continue to buy Common Class shares of the Funds and open new accounts under the same Social Security number. Each class of shares in each Fund represents an equal pro rata interest in each Fund, except that they bear different expenses, which reflect the difference in the range of services provided to them. Class A shares of each Fund are sold subject to a maximum front-end sales charge of 5.75%. Class B shares are sold subject to a contingent deferred sales charge which declines from 4.00% to zero depending on the period of time the shares are held. Class C shares are sold subject to a contingent deferred sales charge of 1.00% if the shares are redeemed within the first year of purchase. A) SECURITY VALUATION -- The net asset value of each Fund is determined daily as of the close of regular trading on the New York Stock Exchange, Inc. (the "Exchange") on each day the Exchange is open for business. Each Fund's equity investments are valued at market value, which is generally determined using the closing price on the exchange or market on which the security is primarily traded at the time of valuation (the 54 "Valuation Time"). If no sales are reported, equity investments are generally valued at the most recent bid quotation as of the Valuation Time or at the lowest asked quotation in the case of a short sale of securities. Debt securities with a remaining maturity greater than 60 days are valued in accordance with the price supplied by a pricing service, which may use a matrix, formula or other objective method that takes into consideration market indices, yield curves and other specific adjustments. Debt obligations that will mature in 60 days or less are valued on the basis of amortized cost, which approximates market value, unless it is determined that using this method would not represent fair value. Securities and other assets for which market quotations are not readily available, or whose values have been materially affected by events occurring before each Fund's Valuation Time but after the close of the securities' primary markets, are valued at fair value as determined in good faith by, or under the direction of, the Board of Trustees/Directors under procedures established by the Board of Trustees/Directors. Each Fund may utilize a service provided by an independent third party which has been approved by the Board of Trustees/Directors to fair value certain securities. B) FOREIGN CURRENCY TRANSACTIONS -- The books and records of the Funds are maintained in U.S. dollars. Transactions denominated in foreign currencies are recorded at the current prevailing exchange rates. All assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the current exchange rate at the end of the period. Translation gains or losses resulting from changes in the exchange rate during the reporting period and realized gains and losses on the settlement of foreign currency transactions are reported in the results of operations for the current period. The Funds do not isolate that portion of realized gains and losses on investments in EQUITY securities which is due to changes in the foreign exchange rate from that which is due to changes in market prices of equity securities. The Funds isolate that portion of realized gains and losses on investments in DEBT securities which is due to changes in the foreign exchange rate from that which is due to changes in market prices of debt securities. C) SECURITY TRANSACTIONS AND INVESTMENT INCOME -- Security transactions are accounted for on a trade date basis. Interest income is recorded on the accrual basis. Dividends are recorded on the ex-dividend date. Certain expenses are class-specific expenses and vary by class. Income, expenses (excluding class-specific expenses) and realized/unrealized gains/losses are allocated proportionately to each class of shares based upon 55 the relative net asset value of the outstanding shares of that class. The cost of investments sold is determined by use of the specific identification method for both financial reporting and income tax purposes. D) DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS -- Dividends from net investment income and distributions of net realized capital gains, if any, are declared and paid at least annually. However, to the extent that a net realized capital gain can be reduced by a capital loss carryforward, such gain will not be distributed. Income and capital gain distributions are determined in accordance with federal income tax regulations which may differ from accounting principles generally accepted in the United States of America ("GAAP"). E) FEDERAL INCOME TAXES -- No provision is made for federal taxes, as it is each Fund's intention to continue to qualify for and elect the tax treatment applicable to regulated investment companies under the Internal Revenue Code of 1986, as amended, and make the requisite distributions to its shareholders, which will be sufficient to relieve it from federal income and excise taxes. F) USE OF ESTIMATES -- The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. G) SHORT-TERM INVESTMENTS -- The Funds, together with other funds/portfolios advised by Credit Suisse Asset Management, LLC ("CSAM"), an indirect, wholly-owned subsidiary of Credit Suisse Group, pool available cash into a short-term variable rate time deposit issued by State Street Bank and Trust Company ("SSB"), the Funds' custodian, or a money market fund advised by CSAM. The short-term time deposit issued by SSB is a variable rate account classified as a short-term investment. H) SECURITIES LENDING -- Loans of securities are required at all times to be secured by collateral at least equal to 102% of the market value of domestic securities on loan (including any accrued interest thereon) and 105% of the market value of foreign securities on loan (including any accrued interest thereon). Cash collateral received by the Funds in connection with securities lending activity may be pooled together with cash collateral for other funds/portfolios advised by CSAM and may be invested in a variety of investments, including certain CSAM-advised funds, funds advised by SSB, 56 the Funds' securities lending agent, or money market instruments. However, in the event of default or bankruptcy by the other party to the agreement, realization and/or retention of the collateral may be subject to legal proceedings. The market value of securities on loan to brokers and the value of collateral held by each Fund with respect to such loans at October 31, 2004 are as follows:
MARKET VALUE OF VALUE OF FUND SECURITIES LOANED COLLATERAL RECEIVED ---- ----------------- -------------------- Capital Appreciation $ 18,522,888 $ 18,946,701 Mid-Cap Growth 61,531,421 63,071,784 Small Cap Growth 22,141,843 22,732,706
Prior to March 17, 2004, Credit Suisse First Boston ("CSFB"), an affiliate of CSAM, had been engaged by the Funds to act as the Funds' securities lending agent. Effective March 17, 2004, SSB has been engaged by the Funds to act as the Funds' securities lending agent. The Funds' securities lending arrangement provides that the Funds and SSB will share the net income earned from securities lending activities with each Fund receiving 70% and SSB receiving 30% of the earnings from the investment of cash collateral or any other securities lending income in accordance with the provisions of the securities lending agency agreement. The Funds may also be entitled to certain minimum amounts of income from their securities lending activities. Securities lending income is accrued as earned. I) OTHER -- The Funds may invest in securities of foreign countries and governments which involve certain risks in addition to those inherent in domestic investments. Such risks generally include, among others, currency risks (fluctuations in currency exchange rates), information risk (key information may be inaccurate or unavailable) and political risk (expropriation, nationalization or the imposition of capital or currency controls or punitive taxes). Other risks of investing in foreign securities include liquidity and valuation risks. The Funds may be subject to taxes imposed by countries in which they invest, with respect to their investments in issuers existing or operating in such countries. Such taxes are generally based on income earned or repatriated and capital gains realized on the sale of such investments. These Funds accrue such taxes when the related income or gains are earned. 57 Each of Capital Appreciation and Mid-Cap Growth may invest up to 10% of its total assets in non-publicly traded securities. Small Cap Growth may invest up to 15% of its net assets in such securities. Non-publicly traded securities may be less liquid than publicly traded securities. Although these securities may be resold in privately negotiated transactions, the prices realized from such sales could differ from the price originally paid by such Fund or the current carrying values, and the difference could be material. NOTE 2. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES CSAM serves as investment adviser to each Fund. For its investment advisory services, CSAM is entitled to receive a fee from each Fund based on the following fee schedule:
FUND ANNUAL RATE ---- ----------- Capital Appreciation 0.70% of average daily net assets Mid-Cap Growth 0.90% of average daily net assets Small Cap Growth 1.00% of average daily net assets
For the year ended October 31, 2004, investment advisory fees earned and voluntarily waived for the Funds were as follows:
GROSS NET ADVISORY ADVISORY FUND FEE WAIVER FEE ---- ------------ ------------ ------------ Capital Appreciation $ 3,498,568 $ -- $ 3,498,568 Mid-Cap Growth 3,887,905 -- 3,887,905 Small Cap Growth 907,109 (534,747) 372,362
CSAM will not recapture from the Funds any fees it waived during the fiscal year ended October 31, 2004. Credit Suisse Asset Management Securities, Inc. ("CSAMSI"), an affiliate of CSAM, and SSB serve as each Fund's co-administrators. For co-administrative services, CSAMSI currently receives a fee calculated at an annual rate of 0.10% of each Fund's average daily net assets. For the year ended October 31, 2004, co-administrative services fees earned by CSAMSI were as follows:
FUND CO-ADMINISTRATION FEE ---- --------------------- Capital Appreciation $ 499,796 Mid-Cap Growth 431,989 Small Cap Growth 90,711
58 For its co-administrative services, SSB receives a fee, exclusive of out-of-pocket expenses, based upon the following fee schedule calculated in total for all the Credit Suisse funds/portfolios co-administered by SSB and allocated based upon relative average net assets of each fund/portfolio, subject to an annual minimum fee.
AVERAGE DAILY NET ASSETS ANNUAL RATE ------------------------ ----------- First $5 billion 0.050% of average daily net assets Next $5 billion 0.035% of average daily net assets Over $10 billion 0.020% of average daily net assets
For the year ended October 31, 2004, co-administrative service fees earned by SSB (including out-of-pocket fees) were as follows:
FUND CO-ADMINISTRATION FEE ---- --------------------- Capital Appreciation $ 293,146 Mid-Cap Growth 255,853 Small Cap Growth 62,494
In addition to serving as each Fund's co-administrator, CSAMSI currently serves as distributor of each Fund's shares. Pursuant to distribution plans adopted by each Fund pursuant to Rule 12b-1 under the 1940 Act, CSAMSI receives fees for its distribution services. These fees are calculated at an annual rate of 0.25% of the average daily net assets of the Common Class shares of Small Cap Growth. For the Advisor Class shares of Capital Appreciation, Mid-Cap Growth and Small Cap Growth, the shareholder servicing fee is calculated at an annual rate of 0.50% of the average daily net assets. For the Class A shares of each Fund, the fee is calculated at an annual rate of 0.25% of average daily net assets. For the Class B and Class C shares of each Fund, the fee is calculated at an annual rate of 1.00% of average daily net assets. Certain brokers, dealers and financial representatives provide transfer agent related services to the Funds, and receive compensation for these services from CSAM. CSAM is then reimbursed by the Funds. For the year ended October 31, 2004, the Funds reimbursed CSAM the following amounts, which are included in each Fund's transfer agent expense as follows:
FUND AMOUNT ---- ---------- Capital Appreciation $ 471,537 Mid-Cap Growth 550,026 Small Cap Growth 114,465
59 For the period November 1, 2003 through March 16, 2004, CSFB received fees for its securities lending activities as follows:
FUND AMOUNT ---- ---------- Capital Appreciation $ 630 Mid-Cap Growth 1,875 Small Cap Growth --
For the year ended October 31, 2004, CSAMSI and its affiliates advised the Funds that it retained the following amounts from commissions earned on the sale of the Funds' Class A shares:
FUND AMOUNT ---- ---------- Capital Appreciation $ 11,494 Mid-Cap Growth 4,181 Small Cap Growth 2,703
Merrill Corporation ("Merrill"), an affiliate of CSAM, has been engaged by the Funds to provide certain financial printing and fulfillment services. For the year ended October 31, 2004, Merrill was paid for its services by the Funds as follows:
FUND AMOUNT ---- ---------- Capital Appreciation $ 10,874 Mid-Cap Growth 11,843 Small Cap Growth 11,618
NOTE 3. LINE OF CREDIT The Funds, together with other funds/portfolios advised by CSAM (collectively, the "Participating Funds"), participate in a $75 million committed, unsecured line of credit facility ("Credit Facility") for temporary or emergency purposes with Deutsche Bank, A.G. as administrative agent and syndication agent and SSB as operations agent. Under the terms of the Credit Facility, the Participating Funds pay an aggregate commitment fee at a rate of 0.10% per annum on the average unused amount of the Credit Facility, which is allocated among the Participating Funds in such manner as is determined by the governing Boards of the Participating Funds. In addition, the Participating Funds pay interest on borrowings at the Federal Funds rate plus 0.50%. At October 31, 2004 and during the year ended October 31, 2004, the Funds had no borrowings under the Credit Facility. 60 NOTE 4. PURCHASES AND SALES OF SECURITIES For the year ended October 31, 2004, purchases and sales of investment securities (excluding short-term investments) were as follows:
FUND PURCHASES SALES ---- -------------- -------------- Capital Appreciation $ 344,316,388 $ 445,959,300 Mid-Cap Growth 436,824,801 518,258,398 Small Cap Growth 93,508,622 84,624,362
NOTE 5. RESTRICTED SECURITIES Certain investments of the Funds are restricted as to resale and are valued at fair value as determined in good faith by or under the direction of the Board of Directors under procedures established by the Board of Directors in the absence of readily ascertainable market values. The table below shows the number of shares held, the acquisition dates, aggregate cost, fair value as of October 31, 2004, value per share of such security and percentage of net assets that the securities represent.
PERCENTAGE SECURITY NUMBER ACQUISITION FAIR VALUE PER OF NET ASSET FUND DESCRIPTION OF SHARES DATE COST VALUE SHARE VALUE ---- --------------- ------------ ------------ ------------ ------------ ------------ ------------ Mid-Cap Growth Celletra Ltd 1,102,524 4/5/2000 $ 7,000,000 $ -- $ -- 0.00% Small Cap Growth Planetweb, Inc. 27,600 9/8/2000 149,913 214 0.01 0.00%
NOTE 6. CAPITAL SHARE TRANSACTIONS Capital Appreciation is authorized to issue an unlimited number of full and fractional shares of beneficial interest. Each of Mid-Cap Growth and Small Cap Growth each has four billion full and fractional shares of capital stock authorized and classified as follows: one billion as Common Class shares, one billion as Advisor Class shares, one billion as Class A shares, 500 million classified as Class B shares and 500 million classified as Class C shares. Each Fund has a par value of $.001 per share. Transactions in classes of each Fund were as follows:
CAPITAL APPRECIATION COMMON CLASS ----------------------------------------------------------------- FOR THE YEAR ENDED FOR THE YEAR ENDED OCTOBER 31, 2004 OCTOBER 31, 2003 ----------------------------------------------------------------- SHARES VALUE SHARES VALUE -------------- -------------- -------------- -------------- Shares sold 3,848,365 $ 58,954,276 6,096,105 $ 80,336,248 Shares redeemed (10,306,226) (157,364,379) (16,395,532) (213,752,796) -------------- -------------- -------------- -------------- Net decrease (6,457,861) $ (98,410,103) (10,299,427) $ (133,416,548) ============== ============== ============== ==============
61
CAPITAL APPRECIATION ----------------------------------------------------------------- ADVISOR CLASS ----------------------------------------------------------------- FOR THE YEAR ENDED FOR THE YEAR ENDED OCTOBER 31, 2004 OCTOBER 31, 2003 ----------------------------------------------------------------- SHARES VALUE SHARES VALUE -------------- -------------- -------------- -------------- Shares sold 199,778 $ 2,945,030 363,509 $ 4,570,624 Shares redeemed (415,383) (6,130,851) (516,459) (6,499,704) -------------- -------------- -------------- -------------- Net decrease (215,605) $ (3,185,821) (152,950) $ (1,929,080) ============== ============== ============== ==============
CAPITAL APPRECIATION ----------------------------------------------------------------- CLASS A ----------------------------------------------------------------- FOR THE YEAR ENDED FOR THE YEAR ENDED OCTOBER 31, 2004 OCTOBER 31, 2003 ----------------------------------------------------------------- SHARES VALUE SHARES VALUE -------------- -------------- -------------- -------------- Shares sold 119,043 $ 1,813,009 59,616 $ 810,749 Shares redeemed (33,093) (497,864) (17,150) (229,812) -------------- -------------- -------------- -------------- Net increase 85,950 $ 1,315,145 42,466 $ 580,937 ============== ============== ============== ==============
CAPITAL APPRECIATION ----------------------------------------------------------------- CLASS B ----------------------------------------------------------------- FOR THE YEAR ENDED FOR THE YEAR ENDED OCTOBER 31, 2004 OCTOBER 31, 2003 ----------------------------------------------------------------- SHARES VALUE SHARES VALUE -------------- -------------- -------------- -------------- Shares sold 9,821 $ 147,233 31,099 $ 411,329 Shares redeemed (10,851) (158,817) (10,030) (121,559) -------------- -------------- -------------- -------------- Net increase (decrease) (1,030) $ (11,584) 21,069 $ 289,770 ============== ============== ============== ==============
CAPITAL APPRECIATION ----------------------------------------------------------------- CLASS C ----------------------------------------------------------------- FOR THE YEAR ENDED FOR THE YEAR ENDED OCTOBER 31, 2004 OCTOBER 31, 2003 ----------------------------------------------------------------- SHARES VALUE SHARES VALUE -------------- -------------- -------------- -------------- Shares sold 48,042 $ 717,594 10,123 $ 141,430 Shares redeemed (6,169) (90,752) (2,182) (27,258) -------------- -------------- -------------- -------------- Net increase 41,873 $ 626,842 7,941 $ 114,172 ============== ============== ============== ==============
MID-CAP GROWTH ----------------------------------------------------------------- COMMON CLASS ----------------------------------------------------------------- FOR THE YEAR ENDED FOR THE YEAR ENDED OCTOBER 31, 2004 OCTOBER 31, 2003 ----------------------------------------------------------------- SHARES VALUE SHARES VALUE -------------- -------------- -------------- -------------- Shares sold 2,492,444 $ 70,859,091 3,872,754 $ 85,663,702 Shares redeemed (4,703,603) (131,227,801) (7,524,829) (159,014,240) -------------- -------------- -------------- -------------- Net decrease (2,211,159) $ (60,368,710) (3,652,075) $ (73,350,538) ============== ============== ============== ==============
62
MID-CAP GROWTH ----------------------------------------------------------------- ADVISOR CLASS ----------------------------------------------------------------- FOR THE YEAR ENDED FOR THE YEAR ENDED OCTOBER 31, 2004 OCTOBER 31, 2003 ----------------------------------------------------------------- SHARES VALUE SHARES VALUE -------------- -------------- -------------- -------------- Shares sold 668,569 $ 17,674,545 713,469 $ 15,298,835 Shares redeemed (1,261,363) (32,765,904) (1,506,326) (30,566,605) -------------- -------------- -------------- -------------- Net decrease (592,794) $ (15,091,359) (792,857) $ (15,267,770) ============== ============== ============== ==============
MID-CAP GROWTH ----------------------------------------------------------------- CLASS A ----------------------------------------------------------------- FOR THE YEAR ENDED FOR THE YEAR ENDED OCTOBER 31, 2004 OCTOBER 31, 2003 ----------------------------------------------------------------- SHARES VALUE SHARES VALUE -------------- -------------- -------------- -------------- Shares sold 25,692 $ 720,949 2,762 $ 65,730 Shares redeemed (8,077) (221,074) (1) (26) -------------- -------------- -------------- -------------- Net increase 17,615 $ 499,875 2,761 $ 65,704 ============== ============== ============== ==============
MID-CAP GROWTH ----------------------------------------------------------------- CLASS B CLASS C ----------------------------------------------------------------- FOR THE PERIOD ENDED FOR THE PERIOD ENDED OCTOBER 31, 2004(1) OCTOBER 31, 2004(1) ----------------------------------------------------------------- SHARES VALUE SHARES VALUE -------------- -------------- -------------- -------------- Shares sold 264 $ 8,000 34 $ 1,000 -------------- -------------- -------------- -------------- Net increase 264 $ 8,000 34 $ 1,000 ============== ============== ============== ==============
SMALL CAP GROWTH ----------------------------------------------------------------- COMMON CLASS ----------------------------------------------------------------- FOR THE YEAR ENDED FOR THE YEAR ENDED OCTOBER 31, 2004 OCTOBER 31, 2003 ----------------------------------------------------------------- SHARES VALUE SHARES VALUE -------------- -------------- -------------- -------------- Shares sold 1,948,573 $ 37,517,015 2,756,033 $ 40,668,973 Shares redeemed (1,998,668) (37,333,447) (1,910,389) (26,349,264) -------------- -------------- -------------- -------------- Net increase (decrease) (50,095) $ 183,568 845,644 $ 14,319,709 ============== ============== ============== ==============
SMALL CAP GROWTH ------------------------------- ADVISOR CLASS ------------------------------- FOR THE PERIOD ENDED OCTOBER 31, 2004(1) ------------------------------- SHARES VALUE -------------- -------------- Shares sold 51 $ 1,000 -------------- -------------- Net increase 51 $ 1,000 ============== ==============
63
SMALL CAP GROWTH ----------------------------------------------------------------- CLASS A ----------------------------------------------------------------- FOR THE YEAR ENDED FOR THE YEAR ENDED OCTOBER 31, 2004 OCTOBER 31, 2003 ----------------------------------------------------------------- SHARES VALUE SHARES VALUE -------------- -------------- -------------- -------------- Shares sold 600,195 $ 11,024,774 36,233 $ 593,432 Shares redeemed (66,165) (1,237,657) (11,111) (173,299) -------------- -------------- -------------- -------------- Net increase 534,030 $ 9,787,117 25,122 $ 420,133 ============== ============== ============== ==============
SMALL CAP GROWTH ----------------------------------------------------------------- CLASS B CLASS C ----------------------------------------------------------------- FOR THE PERIOD ENDED FOR THE PERIOD ENDED OCTOBER 31, 2004(1) OCTOBER 31, 2004(1) ----------------------------------------------------------------- SHARES VALUE SHARES VALUE -------------- -------------- -------------- -------------- Shares sold 564 $ 10,251 50 $ 1,000 -------------- -------------- -------------- -------------- Net increase 564 $ 10,251 50 $ 1,000 ============== ============== ============== ==============
(1) For the period February 27, 2004 (inception date) through October 31, 2004. On October 31, 2004, the number of shareholders that held 5% or more of the outstanding shares of each class of shares of each Fund were as follows:
NUMBER OF APPROXIMATE PERCENTAGE FUND SHAREHOLDERS OF OUTSTANDING SHARES ---- ------------ ---------------------- Capital Appreciation Common 4 42% Advisor 2 70% Class A 3 51% Class B 5 69% Class C 2 50% Mid-Cap Growth Common 3 51% Advisor 1 89% Class A 3 80% Class B 2 99% Small Cap Growth Common 2 74% Class B 2 99%
Some of the shareholders are omnibus accounts, which hold shares on behalf of individual shareholders. 64 NOTE 7. FEDERAL INCOME TAXES Income and capital gain distributions are determined in accordance with federal income tax regulations, which may differ from GAAP. These differences are primarily due to differing treatments of losses deferred due to wash sales. At October 31, 2004, the components of distributable earnings on a tax basis for the Funds were as follows:
CAPITAL APPRECIATION MID-CAP GROWTH SMALL CAP GROWTH -------------------- ---------------- ---------------- Accumulated realized loss $ (385,078,822) $ (222,027,048) $ (9,205,493) Unrealized appreciation 42,778,635 30,186,927 6,230,787 ---------------- -------------- -------------- $ (342,300,187) $ (191,840,121) $ (2,974,706) ================ ============== ==============
At October 31, 2004, the Funds had capital loss carryforwards available to offset possible future capital gains as follows:
EXPIRES OCTOBER 31, ---------------------------------------------------- FUND 2009 2010 2011 ---- ---------------- -------------- -------------- Capital Appreciation $ 160,595,888 $ 186,923,215 $ 37,559,718 Mid-Cap Growth 197,357,121 24,669,925 -- Small Cap Growth 3,057,367 5,907,087 241,039
During the tax year ended October 31, 2004, Capital Appreciation, Mid-Cap Growth and Small Cap Growth have utilized $17,194,544, $79,741,556 and $9,026,585 of the capital loss carryforwards, respectively. It is uncertain whether the Funds will be able to realize the benefits before they expire. As of October 31, 2004, the identified cost for federal income tax purposes, as well as the gross unrealized appreciation from investments for those securities having an excess of value over cost, gross unrealized depreciation from investments for those securities having an excess of cost over value and the net unrealized appreciation from investments were as follows:
IDENTIFIED GROSS UNREALIZED GROSS UNREALIZED NET UNREALIZED FUND COST APPRECIATION (DEPRECIATION) APPRECIATION ---- ---------------- ---------------- ---------------- ---------------- Capital Appreciation $ 430,404,470 $ 70,928,061 $ (28,149,426) $ 42,778,635 Mid-Cap Growth 429,442,448 49,947,432 (19,760,505) 30,186,927 Small Cap Growth 107,953,441 11,850,041 (5,619,254) 6,230,787
At October 31, 2004, accumulated undistributed net investment income and paid-in capital have been adjusted for current period permanent book/tax differences which arose principally from differing book/tax 65 treatments of net operating losses. Net assets were not affected by these reclassifications:
UNDISTRIBUTED PAID-IN NET INVESTMENT FUND CAPITAL INCOME ---- ------------ -------------- Capital Appreciation $ (2,930,324) $ 2,930,324 Mid-Cap Growth (4,833,037) 4,833,037 Small Cap Growth (1,103,066) 1,103,066
NOTE 8. CONTINGENCIES In the normal course of business, the Funds may provide general indemnifications pursuant to certain contracts and organizational documents. The Funds' maximum exposure under these arrangements is dependent on future claims that may be made against the Funds and, therefore, cannot be estimated; however, based on experience, the risk of loss from such claims is considered remote. 66 CREDIT SUISSE FUNDS REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors/Trustees and Shareholders of Credit Suisse Capital Appreciation Fund; Credit Suisse Mid-Cap Growth Fund, Inc.; Credit Suisse Small Cap Growth Fund, Inc.: In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of Credit Suisse Capital Appreciation Fund, Credit Suisse Mid-Cap Growth Fund, Inc. (formerly Credit Suisse Emerging Growth Fund, Inc.), and Credit Suisse Small Cap Growth Fund, Inc. (hereafter referred to as the "Funds") at October 31, 2004, the results of each of their operations for the year then ended, the changes in each of their net assets for each of the two years in the period then ended and the financial highlights for each of the years (or periods) presented, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Funds' management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements 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 are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at October 31, 2004 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion. PricewaterhouseCoopers LLP Baltimore, Maryland December 15, 2004 67 CREDIT SUISSE FUNDS INFORMATION CONCERNING DIRECTORS/TRUSTEES AND OFFICERS (UNAUDITED)
NUMBER OF TERM PORTFOLIOS IN OF OFFICE(1) FUND AND COMPLEX OTHER POSITION(S) LENGTH PRINCIPAL OVERSEEN BY DIRECTORSHIPS NAME, ADDRESS AND HELD WITH OF TIME OCCUPATION(S) DURING DIRECTOR/ HELD BY DIRECTOR/ DATE OF BIRTH FUND SERVED PAST FIVE YEARS TRUSTEE TRUSTEE ----------------------------- ------------ ------------ -------------------- --------------- ------------------- INDEPENDENT DIRECTORS/ TRUSTEES Richard H. Francis Director/ Since Currently retired 42 None c/o Credit Suisse Asset Trustee, 1999 Management, LLC Nominating 466 Lexington Avenue and Audit New York, New York Committee 10017-3140 Member Date of Birth: 04/23/32 Jeffrey E. Garten Director/ Since Dean of Yale School 41 Director of Aetna, Box 208200 Trustee, 1998(2) of Management and Inc. (insurance New Haven, Connecticut Nominating William S. Beinecke company); Director 06520-8200 and Audit Professor in the of Calpine Committee Practice of Corporation (energy Date of Birth: 10/29/46 Member International Trade provider); Director and Finance from of CarMax Group November 1995 to (used car dealers) present. Peter F. Krogh Director/ Since Dean Emeritus and 41 Director of 301 ICC Trustee, 2001 Distinguished Carlisle Georgetown University Nominating Professor of Companies Washington, DC 20057 Committee International Incorporated Chairman and Affairs at the (diversified Date of Birth: 02/11/37 Audit Edmund A.Walsh manufacturing Committee School of Foreign company) Member Service, Georgetown University from June 1995 to present. James S. Pasman, Jr. Director/ Since Currently retired 43 Director of c/o Credit Suisse Asset Trustee, 1999 Education Management, LLC Nominating Management 466 Lexington Avenue and Audit Corp. New York, New York Committee 10017-3140 Member Date of Birth: 12/20/30
---------- (1) Each Director/Trustee and Officer serves until his or her respective successor has been duly elected and qualified. (2) Mr. Garten was initially appointed as a Director/Trustee of Capital Appreciation, Mid-Cap Growth and Small Cap Growth on February 6, 1998. He resigned as Director/Trustee on February 3, 2000 and was subsequently reappointed on December 21, 2000. 68
NUMBER OF TERM PORTFOLIOS IN OF OFFICE(1) FUND AND COMPLEX OTHER POSITION(S) LENGTH PRINCIPAL OVERSEEN BY DIRECTORSHIPS NAME, ADDRESS AND HELD WITH OF TIME OCCUPATION(S) DURING DIRECTOR/ HELD BY DIRECTOR/ DATE OF BIRTH FUND SERVED PAST FIVE YEARS TRUSTEE TRUSTEE ----------------------------- ------------ ------------ -------------------- --------------- ------------------- INDEPENDENT DIRECTORS/ TRUSTEES Steven N. Rappaport Director/ Since Partner of Lehigh 43 Director of Lehigh Court, LLC Trustee, 1999 Court, LLC and RZ Presstek, Inc. 40 East 52nd Street Nominating Capital (private (digital imaging New York, New York Committee investment firms) technologies 10022 Member and from July 2002 to company); Director Audit present; Transition of Wood Resources, Date of Birth: 07/10/48 Committee Adviser to SunGard LLC. (plywood Chairman Securities Finance, manufacturing Inc. from February company) 2002 to July 2002; President of SunGard Securities Finance, Inc. from 2001 to February 2002; President of Loanet, Inc. (on-line accounting service) from 1997 to 2001. INTERESTED DIRECTORS/ TRUSTEES Michael E. Kenneally(3) Chairman and Since Chairman and Global 45 None Credit Suisse Asset Global Chief 2004 Chief Executive Management, LLC Executive Officer of CSAM 466 Lexington Avenue Officer since 2003; Chairman New York, New York and Chief Investment 10017-3140 Officer of Banc of America Capital Date of Birth: 03/30/54 Management from 1998 to March 2003.
---------- (3) Mr. Kenneally is a Director/Trustee who is an "interested person" of the Fund as defined in the 1940 Act, because he is an officer of CSAM. 69
NUMBER OF TERM PORTFOLIOS IN OF OFFICE(1) FUND AND COMPLEX OTHER POSITION(S) LENGTH PRINCIPAL OVERSEEN BY DIRECTORSHIPS NAME, ADDRESS AND HELD WITH OF TIME OCCUPATION(S) DURING DIRECTOR/ HELD BY DIRECTOR/ DATE OF BIRTH FUND SERVED PAST FIVE YEARS TRUSTEE TRUSTEE ----------------------------- ------------ ------------ -------------------- --------------- ------------------- INTERESTED DIRECTORS/ TRUSTEES William W. Priest, Jr.(4) Director/ Since Chief Executive 48 Director of Globe Epoch Investment Partners Trustee 1999 Officer of J Net Wireless, LLC 667 Madison Avenue Enterprises, Inc. (maritime New York, NY 10021 (technology holdings communication company) since June company); Director Date of Birth: 09/24/41 2004; Chief of InfraRed X Executive Officer of (medical device Epoch Investment company); Director Partners, Inc. since of J Net April 2004; Enterprises, Inc. Co-Managing Partner, Steinberg Priest & Sloane Capital Management, LLC from 2001 to March 2004; Chairman and Managing Director of CSAM from 2000 to February 2001; Chief Executive Officer and Managing Director of CSAM from 1990 to 2000.
---------- (4) Mr. Priest is a Director/Trustee who is an "interested person" of the Fund as defined in the 1940 Act, because he provided consulting services to CSAM within the last two years (ended 12/31/02). 70
TERM OF OFFICE(1) AND POSITION(S) LENGTH NAME, ADDRESS AND HELD WITH OF TIME DATE OF BIRTH FUND SERVED PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS ----------------------------- ------------ ------------ ---------------------------------------------- OFFICERS Michael A. Pignataro Chief Since Director and Director of Fund Administration Credit Suisse Asset Financial 1999 of CSAM; Associated with CSAM since 1984; Management, LLC Officer and Officer of other Credit Suisse Funds 466 Lexington Avenue Treasurer New York, New York 10017-3140 Date of Birth: 11/15/59 Emidio Morizio Chief Since Vice President and Global Head of Compliance Credit Suisse Asset Compliance 2004 of CSAM; Associated with CSAM since July 2000; Management, LLC Officer Vice President and Director of Compliance of 466 Lexington Avenue Forstmann-Leff Associates from 1998 to June New York, New York 2000; Officer of other Credit Suisse Funds 10017-3140 Date of Birth: 09/21/66 Ajay Mehra Chief Legal Since Director and Deputy General Counsel of CSAM Credit Suisse Asset Officer 2004 since September 2004; Senior Associate of Management, LLC Shearman & Sterling LLP from September 2000 to 466 Lexington Avenue September 2004; Senior Counsel of the SEC New York, New York Division of Investment Management from June 10017-3140 1997 to September 2000; Officer of other Credit Suisse Funds Date of Birth: 08/14/70 J. Kevin Gao Vice Since Vice President and legal counsel of CSAM; Credit Suisse Asset President 2004 Associated with CSAM since July 2003; Management, LLC and Associated with the law firm of Willkie, Farr 466 Lexington Avenue Secretary & Gallagher LLP from 1998 to 2003; Officer of New York, New York other Credit Suisse Funds 10017-3140 Date of Birth: 10/13/67 Robert M. Rizza Assistant Since Assistant Vice President of CSAM since January Credit Suisse Asset Treasurer 2002 2001; Associated with CSAM since 1998; Officer Management, LLC of other Credit Suisse Funds 466 Lexington Avenue New York, New York 10017-3140 Date of Birth: 12/09/65
The Statement of Additional Information includes additional information about the Directors/Trustees and is available, without charge, upon request, by calling 800-927-2874. 71 CREDIT SUISSE FUNDS TAX INFORMATION LETTER (UNAUDITED) October 31, 2004 IMPORTANT TAX INFORMATION FOR CORPORATE SHAREHOLDERS For the fiscal year ended October 31, 2004 certain dividends paid by the Funds may be subject to a maximum tax rate of 15%, as provided for by the Jobs and Growth Tax Relief Reconciliation Act of 2003. Complete information will be reported in conjunction with your 2004 Form 1099-DIV. 72 CREDIT SUISSE FUNDS PROXY POLICY NOTICE AND PORTFOLIO HOLDINGS INFORMATION Information regarding how each Fund voted proxies related to its portfolio securities during the 12-month period ended June 30, 2004 as well as the policies and procedures that each Fund uses to determine how to vote proxies relating to its portfolio securities are available: - By calling 1-800-927-2874 - On the Funds' website, www.csam.com/us - On the website of the Securities and Exchange Commission, http://www.sec.gov. Each Fund files a complete schedule of its portfolio holdings for the first and third quarters of its fiscal year with the SEC on Form N-Q. The Funds' Forms N-Q are available on the SEC's website at http://www.sec.gov and may be reviewed and copied at the SEC's Public Reference Room in Washington, DC. Information on the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330. 73 This page intentionally left blank This page intentionally left blank This page intentionally left blank [CREDIT SUISSE ASSET MANAGEMENT LOGO] P.O. BOX 55030, BOSTON, MA 02205-5030 800-927-2874 - www.csam.com/us CREDIT SUISSE ASSET MANAGEMENT SECURITIES, INC., DISTRIBUTOR. CSGTH-2-1004 ITEM 2. CODE OF ETHICS. The registrant has adopted a code of ethics applicable to its Chief Executive Officer, President, Chief Financial Officer and Chief Accounting Officer, or persons performing similar functions. A copy of the code is filed as Exhibit 12(a)(1) to this Form. There were no amendments to the code during the fiscal year ended October 31, 2004. There were no waivers or implicit waivers from the code granted by the registrant during the fiscal year ended October 31, 2004. ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT. The registrant's governing board has determined that it has three audit committee financial experts serving on its audit committee: Richard H. Francis, James S. Pasman, Jr., and Steven N. Rappaport. Each audit committee financial expert is "independent" for purposes of this item. ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. (a) through (d). The information in the table below is provided for services rendered to the registrant by its independent registered public accounting firm, PricewaterhouseCoopers LLP ("PwC"), for its fiscal years ended October 31, 2003 and October 31, 2004.
2003 2004 --------- --------- Audit Fees $ 16,315 $ 16,315 Audit-Related Fees(1) $ 3,000 $ 4,500 Tax Fees(2) $ 2,323 $ 2,323 All Other Fees -- -- Total $ 21,638 $ 23,138
(1) Services include agreed-upon procedures in connection with the registrant's semi-annual financial statements ($3,000), and the registrant's third quarter 2004 Form N-Q filing ($1,500). (2) Tax services in connection with the registrant's excise tax calculations and review of the registrant's applicable tax returns. The information in the table below is provided with respect to non-audit services that directly relate to the registrant's operations and financial reporting and that were rendered by PwC to the registrant's investment adviser, Credit Suisse Asset Management, LLC ("CSAM"), and any service provider to the registrant controlling, controlled by or under common control with CSAM that provided ongoing services to the registrant ("Covered Services Provider"), for the registrant's fiscal years ended October 31, 2003 and October 31, 2004.
2003 2004 --------- -------- Audit-Related Fees N/A N/A
2 Tax Fees N/A N/A All Other Fees N/A N/A Total N/A N/A
(e)(1) Pre-Approval Policies and Procedures. The Audit Committee ("Committee") of the registrant is responsible for pre-approving (i) all audit and permissible non-audit services to be provided by the independent registered public accounting firm to the registrant and (ii) all permissible non-audit services to be provided by the independent registered public accounting firm to CSAM and any Covered Services Provider if the engagement relates directly to the operations and financial reporting of the registrant. The Committee may delegate its responsibility to pre-approve any such audit and permissible non-audit services to the Chairperson of the Committee, and the Chairperson shall report to the Committee, at its next regularly scheduled meeting after the Chairperson's pre-approval of such services, his or her decision(s). The Committee may also establish detailed pre-approval policies and procedures for pre-approval of such services in accordance with applicable laws, including the delegation of some or all of the Committee's pre-approval responsibilities to other persons (other than CSAM or the registrant's officers). Pre-approval by the Committee of any permissible non-audit services shall not be required so long as: (i) the aggregate amount of all such permissible non-audit services provided to the registrant, CSAM and any Covered Services Provider constitutes not more than 5% of the total amount of revenues paid by the registrant to its independent registered public accounting firm during the fiscal year in which the permissible non-audit services are provided; (ii) the permissible non-audit services were not recognized by the registrant at the time of the engagement to be non-audit services; and (iii) such services are promptly brought to the attention of the Committee and approved by the Committee (or its delegate(s)) prior to the completion of the audit. (e)(2) The information in the table below sets forth the percentages of fees for services (other than audit, review or attest services) rendered by PwC to the registrant for which the pre-approval requirement was waived pursuant to Rule 2-01(c)(7)(i)(C) of Regulation S-X:
2003 2004 --------- -------- Audit-Related Fees N/A N/A Tax Fees N/A N/A All Other Fees N/A N/A Total N/A N/A
3 The information in the table below sets forth the percentages of fees for services (other than audit, review or attest services) rendered by PwC to CSAM and any Covered Services Provider required to be approved pursuant to Rule 2-01(c)(7)(ii)of Regulation S-X, for the registrant's fiscal years ended October 31, 2003 and October 31, 2004:
2003 2004 --------- -------- Audit-Related Fees N/A N/A Tax Fees N/A N/A All Other Fees N/A N/A Total N/A N/A
(f) Not Applicable. (g) The aggregate fees billed by PwC for non-audit services rendered to the registrant, CSAM and Covered Service Providers for the fiscal years ended October 31, 2003 and October 31, 2004 were $5,323 and $6,823, respectively. (h) Not Applicable. ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS. Form N-CSR disclosure requirement is not applicable to the registrant. ITEM 6. SCHEDULE OF INVESTMENTS. Schedule of investments 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. Form N-CSR disclosure requirement is not applicable to the registrant. ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES. Form N-CSR disclosure requirement is not applicable to this registrant. 4 ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS. Form N-CSR disclosure requirement is not applicable to the registrant. ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. Not Applicable. ITEM 11. CONTROLS AND PROCEDURES. (a) As of a date within 90 days from the filing date of this report, the principal executive officer and principal financial officer concluded that the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the "Act")) were effective based on their evaluation of the disclosure controls and procedures required by Rule 30a-3(b) under the Act and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934. (b) There were no changes in registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting. ITEM 12. EXHIBITS. (a)(1) Registrant's Code of Ethics is an exhibit to this report. (a)(2) The certifications of the registrant as required by Rule 30a-2(a) under the Act are exhibits to this report. (a)(3) Not applicable. (b) The certifications of the registrant as required by Rule 30a-2(b) under the Act are an exhibit to this report. 5 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. CREDIT SUISSE SMALL CAP GROWTH FUND, INC. /s/ Michael E. Kenneally ------------------------ Name: Michael E. Kenneally Title: Chief Executive Officer Date: January 7, 2005 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. /s/ Michael E. Kenneally ------------------------ Name: Michael E. Kenneally Title: Chief Executive Officer Date: January 7, 2005 /s/ Michael A. Pignataro ------------------------ Name: Michael A. Pignataro Title: Chief Financial Officer Date: January 7, 2005 6